[Analytical Perspectives]
[Other Technical Presentations]
[15. Trust Funds and Federal Funds]
[From the U.S. Government Publishing Office, www.gpo.gov]
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OTHER TECHNICAL PRESENTATIONS
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15. TRUST FUNDS AND FEDERAL FUNDS
The budget consists of two major groups of funds: Federal funds and
trust funds. This section presents summary information about the
transactions of each of these two fund groups and of the major trust
funds. It also discusses the recent reclassification of most Indian
tribal trust funds as non-budgetary. Information is also provided about
the income and outgo of four Federal funds that are financed by
earmarked collections in a manner similar to trust funds.
Federal Funds Group
The Federal funds group comprises the larger part of the budget. It
includes all transactions not classified by law as being in trust funds.
The main financing component of the Federal funds group is the general
fund, which is used to carry out the general purposes of Government
rather than being restricted by law to a specific program. It consists
of all collections not earmarked by law to finance other funds,
including virtually all income taxes and many excise taxes, and all
expenditures financed by these collections and by general Treasury
borrowing.
The Federal funds group also includes special funds and revolving
funds, which earmark collections for spending on specific purposes.
Where the law requires that Federal fund collections from a specified
source be earmarked to finance a particular program, such as a portion
of the Outer Continental Shelf mineral leasing receipts deposited into
the Land and Water Conservation Fund, the collections and associated
disbursements are recorded in special fund receipt and expenditure
accounts. The majority of special fund collections are derived from the
Government's power to impose taxes, fines, and other compulsory
payments. These collections must be appropriated before they can be
obligated and spent. Significant amounts of collections credited to
special funds are derived from business-like activity, such as the
receipts from Outer Continental Shelf mineral leasing.
Revolving funds conduct continuing cycles of business-like activity.
They receive receipts from the sale of products or services and use the
proceeds to finance their spending. Instead of being deposited in
receipt accounts, their proceeds are recorded in the revolving funds,
which are expenditure accounts. These collections generally are
available automatically for obligation and making payments. Outlays for
revolving funds are reported net of offsetting collections. There are
two classes of revolving funds. Public enterprise funds, such as the
Postal Service Fund, conduct business-like operations mainly with the
public. Intragovernmental funds, such as the Federal Buildings Fund,
conduct business-like operations mainly within and between Government
agencies.
Trust Funds Group
The trust funds group consists of funds that are designated by law as
trust funds. Like special funds and revolving funds, they earmark
collections for spending on specific purposes. Many of the larger trust
funds finance social insurance payments for individuals, such as Social
Security, Medicare, and unemployment compensation. Other major trust
funds finance military and Federal civilian employees' retirement,
highway and transit construction, and airport and airway development.
There are a few trust revolving funds that are credited with collections
earmarked by law to carry out a cycle of business-type operations. Trust
funds also include a few small funds established to carry out the terms
of a conditional gift or bequest.
There is no substantive difference between trust funds and special
funds or between revolving funds and trust revolving funds. Whether a
particular fund is designated in law as a trust fund is, in many cases,
arbitrary. For example, the National Service Life Insurance Fund is a
trust fund, but the Servicemen's Group Life Insurance Fund is a Federal
fund, even though both are financed by earmarked fees paid by veterans
and both provide life insurance payments to veterans' beneficiaries. \1\
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\1\ Another example is the Violent Crime Reduction Trust Fund,
established pursuant to the Violent Crime Control and Law Enforcement
Act of 1994. Because the Fund is substantively a means of accounting for
general fund appropriations, and does not consist of dedicated receipts,
it is classified as a Federal fund rather than a trust fund,
notwithstanding the presence of the words ``Trust Fund'' in its official
name.
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The Federal budget meaning of the term ``trust'' differs significantly
from the private sector usage. The beneficiary of a private trust owns
the trust's income and often its assets. A custodian manages the assets
on behalf of the beneficiary according to the stipulations of the trust,
which he or she cannot change unilaterally. In contrast, the Federal
Government owns the assets and earnings of most Federal trust funds, and
it can unilaterally raise or lower future trust fund collections and
payments, or change the purpose for which the collections are used, by
changing existing law. Only a few small Federal trust funds are managed
pursuant to a trust agreement where the Government is the trustee, and
the Government generally has some ability to determine the amount
deposited into or paid out of these funds. Other amounts are held in
deposit funds by the Government as a custodian on behalf of some entity
outside the Government. The Government makes no decisions about the
amount of these deposits or how they are spent. Therefore, they are
considered to be non-budgetary instead of Federal trust funds and are
excluded from the Federal budget.
A trust fund's income must be used for the purposes designated by law.
Some, such as the Federal Employ
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ees Health Benefits fund, spend their income almost as quickly as it is
collected. Others, such as the Social Security and the Federal civilian
employees retirement trust funds, currently spend considerably less than
they collect each year. A surplus of income over outgo adds to the trust
fund's balance, which is available to finance future expenditures. The
balances are generally invested, by law, in Treasury debt securities.
Any net cash inflow from the public to the trust funds decreases the
Treasury's need to borrow from the public in order to finance a Federal
funds deficit.
Table 15-1. RECEIPTS, OUTLAYS, AND SURPLUS OR DEFICIT BY FUND GROUP
(In billions of dollars)
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Estimate
1999 -----------------------------------------------------------------
actual 2000 2001 2002 2003 2004 2005
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Receipts:
Federal funds cash income:
From the public................ 1,195.9 1,300.4 1,325.3 1,360.4 1,393.4 1,450.2 1,511.0
From trust funds............... 1.1 1.1 5.5 1.1 1.1 1.2 1.2
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Total, Federal funds cash 1,197.0 1,301.4 1,330.8 1,361.5 1,394.5 1,451.3 1,512.2
income........................
Trust funds cash income:
From the public................ 702.4 730.5 767.1 801.9 842.6 879.3 930.4
From Federal funds:
Interest..................... 120.3 132.7 143.9 155.8 169.8 183.6 198.1
Other........................ 153.2 159.4 181.0 187.7 190.2 206.3 219.6
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Total, trust funds cash 975.9 1,022.5 1,091.9 1,145.4 1,202.7 1,269.1 1,348.1
income....................
Offsetting receipts.............. -345.5 -367.7 -403.7 -425.7 -449.7 -484.3 -519.4
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Total, unified budget receipts. 1,827.5 1,956.3 2,019.0 2,081.2 2,147.5 2,236.1 2,340.9
Outlays:
Federal funds cash outgo......... 1,285.3 1,359.0 1,388.1 1,433.3 1,472.2 1,525.7 1,584.7
Trust funds cash outgo........... 763.2 798.3 850.6 887.7 940.4 999.8 1,060.1
Offsetting receipts.............. -345.5 -367.7 -403.7 -425.7 -449.7 -484.3 -519.4
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Total, unified budget outlays.. 1,703.0 1,789.6 1,835.0 1,895.3 1,962.9 2,041.1 2,125.5
Surplus or deficit (-):
Federal funds.................... -88.3 -57.6 -57.3 -71.8 -77.6 -74.3 -72.5
Trust funds...................... 212.7 224.3 241.3 257.7 262.3 269.3 287.9
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Total, unified surplus/deficit 124.4 166.7 184.0 185.9 184.6 195.0 215.4
(-)...........................
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Note: Receipts include governmental, interfund, and proprietary receipts. They exclude intrafund receipts, which
are offset against intrafund payments so that cash income and cash outgo are not overstated.
The surplus allocation for debt reduction is part of the President's overall budgetary framework to extend the
solvency of Social Security and Medicare, and is shown in Table S-1 in Part 6 of the 2001 Budget.
A trust fund normally consists of one or more receipt accounts (to
record income) and an expenditure account (to record outgo). However, a
few trust funds, such as the Veterans Special Life Insurance fund, are
established by law as revolving funds. These funds are similar to
revolving funds in the Federal funds group. They conduct a cycle of
business-type operations, offsetting collections are credited to the
funds (which are expenditure accounts), and their outlays are displayed
net of the offsetting collections.
Income and Outgo by Fund Group
Table 15-1 shows income, outgo, and surplus or deficit by fund group
and adds them together (and removes double-counting) to derive the total
unified budget receipts, outlays, and surplus or deficit. The estimates
assume enactment of the President's budget proposals. Income consists
mostly of receipts (derived from governmental activity--primarily
income, payroll, and excise taxes--and gifts). It also includes
proprietary receipts (derived from business-like transactions with the
public) and interfund collections (receipts by one fund of payments from
a fund in the other fund group) that are deposited in receipt accounts.
Outgo consists of payments made to the public and/or to a fund in the
other fund group.
Two types of transactions are treated specially. First, income and
outgo for a fund group exclude transactions between funds within the
same fund group.\2\ These intrafund transactions constitute outgo and
income for the individual funds that make and collect the payments.
However, because the totals for each fund group measure its transactions
with the public and the other fund group, intrafund transactions must be
subtracted from the sum of the income and outgo of all individual funds
within the fund group to calculate the consolidated income and outgo for
that fund group as a whole.
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Second, income excludes the offsetting collections, which are offset
against outgo in revolving fund expenditure accounts instead of being
deposited in receipt accounts.\3\ It would be conceptually appropriate
to classify these collections as income, but at present the data are not
tabulated centrally for both fund groups. Consequently, they are offset
against outgo in Table 15-1 and are not shown separately.
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\2\ For example, the railroad retirement trust funds pay the
equivalent of social security benefits to railroad retirees, in addition
to the regular railroad pension. These benefits are financed by a
payment from the Federal Old-Age and Survivors Insurance trust fund to
the railroad retirement trust funds. The payment and collection are both
deducted so that total trust fund income and outgo measure disbursements
to the public and to Federal funds.
\3\ For example, postage stamp fees are deposited as offsetting
collections in the Postal Service fund. As a result, the Fund's outgo is
disbursements net of collections.
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Some funds in the Federal funds group and some trust funds are
authorized to borrow from the general fund of the Treasury.\4\ Borrowed
funds are not recorded as receipts and are excluded from the income of
the fund. The borrowed funds finance outlays by the fund in excess of
available receipts. Subsequently, fund receipts are transferred from the
fund to the general fund in repayment of the borrowing. The repayment is
not recorded as an outlay of the fund or included in fund outgo.
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\4\ For example, the Bonneville Power Administration Fund, a revolving
fund in the Department of Energy, is authorized to borrow from the
general fund, and the Black Lung Disability Trust Fund in the Department
of Labor is authorized to receive appropriations of repayable advances
from the general fund (a form of borrowing).
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Some income in both Federal funds and trust funds consists of
offsetting receipts. For most budget purposes, offsetting receipts are
excluded from receipts figures and subtracted from gross outlays.
There are two reasons for this treatment:
Business-like or market-oriented activities with the public
The collections from such activities are deducted from gross
outlays, rather than added to receipts, in order to produce
budget totals for receipts and outlays that represent
governmental rather than market activity.
Intragovernmental transactions Collections by one
Government account from another are deducted from gross
outlays, rather than added to receipts, so that the budget
totals measure the transactions of the Government with the
public.
Because the income for Federal funds and for trust funds recorded in
Table 15-1 includes offsetting receipts, those offsetting receipts must
be deducted from the two fund groups' combined gross income in order to
reconcile to total (net) unified budget receipts. Similarly, because the
outgo for Federal funds and for trust funds in Table 15-1 consists of
gross outlays, the amount of the offsetting receipts must be deducted
from the sum of the Federal funds' and the trust funds' gross outgo in
order to reconcile to total (net) unified budget outlays.
Income, Outgo, and Balances of Trust Funds
Table 15-2 shows the trust funds balance at the start of each year,
income and outgo during the year, and the end of year balance. Income
and outgo are divided between transactions with the public and
transactions with Federal funds. Receipts from Federal funds are divided
between interest and other interfund receipts.
The definition of income and outgo in this table differs from those in
Table 15-1 in one important way. Trust fund collections that are offset
against outgo (as offsetting collections) within expenditure accounts
instead of being deposited in separate receipt accounts are classified
as income in this table but not in Table 15-1. This classification is
consistent with the definitions of income and outgo for trust funds used
elsewhere in the budget. It has the effect of increasing both income and
outgo by the amount of the offsetting collections. The difference is
approximately $26 billion in 1999. Table 15-2, therefore, provides a
more complete summary of trust fund income and outgo.
The trust funds group is expected to have large and growing surpluses
over the projection period. As a consequence, trust fund balances are
estimated to grow substantially, as they have over the past two decades.
The size of the anticipated balances is unprecedented, and it results
mainly from relatively recent changes in the way some trust funds are
financed.
Until the 1980s, most trust funds operated on a pay-as-you-go basis.
Taxes and user fees were set at levels high enough to finance benefits
and administrative expenses, and to maintain prudent reserves, generally
defined as being equal to one year's expenditures. As a result, trust
fund balances tended to grow at about the same rate as their annual
expenditures.
Pay-as-you-go financing was replaced in the 1980s by full or partial
accrual funding for some of the larger trust funds. In order to
partially prefund the ``baby-boomers'' social security benefits, the
Social Security Amendments of 1983 raised payroll taxes above the levels
necessary to finance current expenditures. In 1984 a new system was set
up to finance military retirement benefits on a full accrual basis. In
1986 full accrual funding of retirement benefits was mandated for
Federal civilian employees hired after December 31, 1983. The latter two
changes require Federal agencies and their employees to make annual
payments to the Federal employees' retirement trust funds in an amount
equal to the value of the retirement benefits earned by employees in
that year. Since many years will pass before current employees are paid
retirement benefits, the trust funds will accumulate substantial
balances over time.
Primarily because of these changes, but also because of the impact of
real growth and inflation, trust fund balances increased ninefold from
1982 to 1999, from $205 billion to $1.9 trillion. Under the proposals in
the President's budget, the balances are estimated to increase by
approximately 82 percent by the year 2005, rising to $3.4 trillion.
Almost all of these balances are invested in Treasury securities and
earn interest. Therefore, they represent the value, in current dollars,
of taxes and user fees that have been paid in advance for future
benefits and services.
Table 15-2. INCOME, OUTGO, AND BALANCES OF TRUST FUNDS GROUP
(In billions of dollars)
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Estimate
1999 -----------------------------------------------------------------------
actual 2000 2001 2002 2003 2004 2005
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Total Trust Funds
Balance, start of year.............................................. 1,663.2 1,875.7 2,099.8 2,340.8 2,598.5 2,860.8 3,130.1
Income:
Governmental receipts............................................. 664.2 696.7 731.9 764.3 794.7 825.8 871.3
Proprietary receipts.............................................. 46.1 42.1 44.0 46.5 57.2 63.2 69.2
Receipts from Federal funds:
Interest........................................................ 120.4 132.8 144.0 157.2 171.1 184.8 199.2
Other........................................................... 171.0 181.1 204.4 210.7 213.2 230.1 245.3
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Subtotal, income.............................................. 1,001.6 1,052.8 1,124.3 1,178.6 1,236.2 1,303.8 1,385.0
Outgo:
To the public..................................................... 787.8 827.4 877.6 919.8 972.8 1,033.4 1,095.8
Payments to Federal funds......................................... 1.1 1.1 5.5 1.1 1.1 1.2 1.2
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Subtotal, outgo............................................... 788.9 828.5 883.0 920.9 973.9 1,034.5 1,097.0
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 92.3 91.5 97.3 100.5 91.2 84.5 88.8
Interest........................................................ 120.4 132.8 144.0 157.2 171.1 184.8 199.2
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Subtotal, surplus or deficit (-).............................. 212.7 224.3 241.3 257.7 262.3 269.3 287.9
Adjustments:
Transfers/lapses (net)............................................ * -0.1 -0.3 .......... .......... .......... ..........
Other adjustments................................................. -* -* -* .......... .......... .......... ..........
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Total, change in fund balance................................... 212.7 224.2 241.0 257.7 262.3 269.3 287.9
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Balance, end of year................................................ 1,876.0 2,099.8 2,340.8 2,598.5 2,860.8 3,130.1 3,418.0
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* Less than $50 million.
\1\ The difference between 1999 end of year balance and 2000 start of year balance is due to the removal of most tribal trust funds from the budget
totals. See the discussion regarding changes in the budget classification of tribal trust funds in this chapter for additional information.
The President's policy framework in this budget is designed to
increase the Government's ability to pay future Social Security and
Medicare benefits. However, this enhanced ability to pay does not arise
from the building up of large trust fund balances in and of itself. When
spending exceeds the trust fund's current income, the trust fund can
exercise its financial claim on eco
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nomic resources by converting its holdings to cash -- whether the
holdings are Treasury bonds or corporate equities. This conversion
ultimately represents an exchange of Government (or corporate) financial
securities for private sector resources.Thus, in either case, the
Government's ability to pay benefits is related to the health of its
overall fiscal position and of the economy as a whole, rather than a
simple function of trust fund balances.
Increases in trust fund balances do strengthen the ability to pay
future benefits if the surplus in the trust fund is matched by an
improvement in the Government's net financial position. It is in this
sense that future benefits can be prefunded. If a trust fund surplus is
matched by a corresponding reduction in publicly held debt, then the
Government's financial position will be improved. This makes it easier
to finance future benefits in two respects. The first, direct effect, is
that this debt reduction reduces future interest payments and frees up
general receipts to finance the future benefits. The second is that debt
reduction increases the resources available for investment in the
economy as a whole. Greater investment now increases future incomes and
wealth, which will provide more real economic resources to support the
benefits, and may prolong the solvency of the trust funds.
Table 15-5, which appears at the end of the chapter, shows estimates
of income, outgo, and balances for 1999 through 2005 for the major trust
funds. With the exception of transactions between trust funds, the data
for the individual trust funds are conceptually the same as the data in
Table 15-2 for the trust funds group. As explained previously,
transactions between trust funds are shown as outgo of the fund that
makes the payment and as income of the fund that collects it in the data
for an individual trust fund, but the collections are offset against
outgo in the data for the trust fund group. Additional information for
these and other trust funds can be found in the Status of Funds tables
in the Budget Appendix.
Table 15-6, which also appears at the end of this chapter, shows
income, outgo, and balances of four Federal funds--a revolving fund and
three special funds. These funds are similar to trust funds in that they
are financed by earmarked receipts, excesses of income over outgo are
invested, the interest earnings add to balances, and the balances remain
available to finance future expenditures. The table is illustrative of
the Fed
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eral funds group, which includes many other revolving funds and special
funds in addition to the ones shown.
Changes in the Budget Classification of the Indian Tribal Funds
Beginning in fiscal year 2000, the Federal budget totals no longer
include funds that are owned by Indian tribes and held and managed in a
fiduciary capacity by the Government on the tribes' behalf. These Indian
tribal funds were included in the budget totals from the adoption of the
unified budget in 1969 through fiscal year 1999, under the generic title
``tribal trust funds.'' As explained below, appropriate application of
current Federal budget concepts dictates that most of the Indian tribal
funds should not be included in the budget or subject to budgetary
constraints. These are trusts, in the private sector meaning of the
term. Of the ones that remain in the budget, about half are special
funds, meaning that their receipts are earmarked to be used to benefit
the tribes. The rest are designated as trust funds. These trust funds
are like other Federal trust funds, in that they consist of receipts
that are earmarked for a specific purpose, but as described earlier in
this chapter, they do not meet the private sector meaning of the term
``trust'' and would more appropriately be classified as special funds.
To avoid confusion over terms, this discussion will refer to the Indian
tribal funds that are no longer included in the budget as ``tribal
fiduciary funds'' and to the ones still included in the budget as
``tribal special funds.''
This reclassification affects only budget coverage and does not change
the operation of the funds or ownership of the fund assets, whether by
the Government or the tribes. The legal obligations of the Secretary of
the Interior, such as distributing interest earnings to tribes, and of
the Secretary of the Treasury, such as paying interest on tribal fund
holdings of Treasury securities, are also not be affected. The funds
will continue to be managed by the Federal Government according to
present law, with the same rights and responsibilities that existed
prior to the reclassification.
The Government currently holds $2.6 billion in approximately 1,400
funds for roughly 315 Indian tribes. Prior to fiscal year 2000, all of
these Indian tribal funds were included in the Federal budget. As shown
in Table 15-3, the Department of the Interior estimates that
approximately $2 billion of assets in approximately 1,400 Indian tribal
funds were removed from budgetary accounts as of October 1, 1999.
Additional amounts may be removed as the Administration finishes
reviewing the Indian tribal funds. The Government also held $480 million
for individual Indians in about 285,000 accounts as of September 30,
1999. These individual Indian accounts have always been classified as
non-budgetary deposit funds, and their categorization will not be
affected by the reclassification of the Indian tribal funds.
The Indian tribal funds are composed mostly of funds belonging to
Indian tribes, and in some cases the Federal Government, that are
required or authorized by law to be deposited in the U.S. Treasury or
managed ``in trust'' by the United States. While all transactions for
Indian tribal funds flow through the Treasury, most are currently
invested outside the Treasury in other legal investments. The assets are
derived from various sources, including payments for land cessions by
treaty; proceeds from sales of land under confiscatory acts of Congress;
proceeds from sales and leases of tribal lands and other natural
resources; judgment awards made by the Indian Claims Commission and the
United States Court of Claims; monies appropriated to fund legislative
settlements; and interest on fund investments. Table 15-3 groups these
sources of income into three categories.
Table 15-3. TRIBAL TRUST FUND BALANCES AND REVISED BUDGETARY TREATMENT
(dollar amounts in millions as of September 30, 1999)
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Type of Tribal Trust Fund Number Amount
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Remaining on-budget (derived from legislative acts
and for Government obligations):
Special funds..................................... 13 520
Trust funds....................................... 16 162
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Subtotal, funds remaining on-budget............. 29 682
Reclassified as non-budgetary:
Funds with assets derived from tribal-owed natural 631 240
resources........................................
Funds funded by judgments against the United 700 1,260
States...........................................
Funds derived from legislative acts and for 50 400
Government obligations...........................
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Subtotal, funds reclassified as non-budgetary... 1,381 1,900
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Grand Total......................................... 1,410 2,582
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As a result of this reclassification, the Federal budget includes the
transactions of all Indian tribal funds through fiscal year 1999, but it
excludes the transactions of the tribal fiduciary funds after their
removal from the budget in fiscal year 2000. The transactions of the
tribal fiduciary funds are instead included in the deposit fund totals
compiled by the Treasury Department. The one-time transfer of Indian
tribal fund assets to non-budgetary deposit funds is not recorded as a
budget outlay because it does not represent an
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allocation of resources by the Government in the current period. In many
cases (e.g., royalties), the resources never belonged to the Government
and therefore should never have been included in the Federal budget. In
other cases (e.g., settlement payments from the Government to the
tribes), the transfers should have increased total budget outlays in
past years, when payments were made to the tribal funds. The historical
data on the budget will not be revised, due to the relatively small
amount of transactions to be excluded from the budget and the difficulty
of retroactively revising the numerous accounts affected by the
reclassification.
Consistency with the Unified Budget.--Reclassifying tribal fiduciary
funds as non-budgetary is consistent with the unified budget concepts
developed by the President's Commission on Budget Concepts in 1967.\5\
The Commission recommended that the budget include all the Federal
Government's programs and all the fiscal transactions of these programs
with the public. The Commission used several criteria in determining
which entities or activities should be included in the Federal budget:
the ownership of the entity or activity, the sources of its capital, the
selection of its managers, and the degree of control the President and
Congress have over its program and budget. In discussing these criteria,
the Commission stated that ``no one of these . . . [criteria] is
conclusive, and at the margin, where boundary questions arise, decisions
have been made on the basis of a net weighing of as many relevant
considerations as possible.'' \6\ With this in mind, the Commission
recommended a comprehensive budget with almost no exception. The
Commission reasoned that entities or activities having characteristics
consistent with other Federal entities or activities, such as Federal
ownership or Presidential and Congressional control over its program or
budget, should be included in the unified budget. Other entities and
activities should be excluded.
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\5\ Report of the President's Commission on Budget Concepts
(Washington, D.C.: U.S. Government Printing Office, October 1967), p.
25.
\6\ Ibid.
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The Commission's distinction between budgetary and non-budgetary
activities is exemplified by the treatment of two Federal employee
retirement funds: the Civil Service Retirement and Disability (CSRD)
trust fund and the Thrift Savings Fund. The CSRD trust fund, which pays
annuities to retired Federal employees, is included in the budget
because the Government owns the assets and can make decisions about the
level and timing of future pension benefit payments. Individuals do not
have separate accounts in the CSRD trust fund, and the fund assets,
which are much smaller than the present value of future pensions earned
to date under current law, do not constitute the employees' promised
benefits and cannot reasonably be looked upon as employees' equity in
the system. Conversely, the Thrift Savings Fund, which holds assets for
Federal employees who participate in the Thrift Savings Plan, is non-
budgetary. The thrift fund is managed by the Government in a fiduciary
capacity on behalf of the participants. The savings plan is a defined
contribution plan--the assets are credited to individual employees'
accounts, and the assets in an account are owned by the employee, who
has a legal claim on the specific assets in that account and no more.
Employee decisions determine most of the amounts contributed to the
Thrift Savings Fund, either directly from the employee or from the
Federal matching contribution, with only a relatively small part being
contributed to the fund automatically. Employees make decisions about
investments among the statutorily prescribed funds. An employee may
borrow from his or her account for specified purposes, such as to
purchase a house or finance educational expenses.\7\
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\7\ A small number of trust funds (according to the private sector
usage of this term) have been established with the Government as the
beneficiary as well as the fiduciary. These funds have especially been
established from gifts by the public to the Government, such as gifts
and donations to the Architect of the Capitol, gifts and bequests to the
Department of Agriculture, and gifts and contributions to the
Corporation for National and Community Service. These funds are included
in the budget totals because the Government owns the fund assets.
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The reclassification of the tribal fiduciary funds as non-budgetary
fits neatly with the ownership criterion of the Commission and the
budgetary treatment of the Thrift Savings Fund and other deposit funds.
Based on the Commission's recommendations, the budget generally does not
include activities or agencies which are not owned by the Federal
Government. Deposit funds are non-budgetary accounts that record amounts
held temporarily until ownership is determined (for example, earnest
money paid by bidders for mineral leases) or held by the Government as
agent for others (for example, state and local income taxes withheld
from Federal employees' salaries and not yet paid to the states and
localities). Tribal fiduciary funds share the principal defining
characteristics of deposit funds private ownership and therefore ought
to be classified in the same way rather than included in the budget.\8\
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\8\ Non-budgetary activities, including deposit funds, are discussed
further in Chapter 19, ``Off-Budget Federal Entities and Non-Budgetary
Activities.'' Deposit funds are also discussed in a section of Chapter
24, ``Budget Systems and Concepts and Glossary.''
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The removal of the tribal fiduciary funds from the budget is also
consistent with the Commission's criteria regarding the source of
capital and the extent of federal control. The assets of the tribal
fiduciary funds whether derived from tribe-owned natural resources,
judgment awards, or appropriated legislative settlements are monies
that, based on legal requirements, are owned by the tribes. The tribal
special funds, in contrast, are funded by appropriations to achieve a
public policy goal, as opposed to resolving a legal claim, and are
established in a manner whereby ownership of the fund's assets is not
conveyed to the tribes. With regard to the extent of Executive and
Congressional control, it is clear that the Government's control over
the tribal fiduciary funds is significantly limited and not sufficient
to override the ownership test. The Government acts as the fiduciary of
the fund assets while they are deposited in the Treasury or held as
other legal investments and, at most, has some influence over the
tribally developed use plans for judgment awards. In effect, the
Government simply serves as a banker, and deposits, and
[[Page 349]]
withdrawals from the fund (i.e., the ``bank account'') do not represent
resource allocation by the Government. Except where prohibited by law,
the tribes can withdraw and manage these assets.
Analyzing the Indian Tribal Funds.--The criteria used to determine the
budgetary treatment of the Indian tribal funds are listed below. Some
are applicable to all Federal funds, while others relate specifically to
the budgetary treatment of the Indian tribal funds. No single criterion
is conclusive. In addition, the relevant considerations are mixed for
many Indian tribal funds, so the classification must be based on the
preponderant weight of the considerations. The guiding rule is that
unless the preponderance of the relevant considerations indicates that a
tribe owns a fund's assets, it will continue to be included in the
Federal budget. In making these decisions, it is imperative to
distinguish between valid legal obligations and moral commitments. A
trust fund could be established as payment for settlement of a valid
legal claim for damages, in which case the funds would belong to the
tribe and the trust fund should be classified as a non-budgetary deposit
fund. Alternatively, a trust fund could be created as a result of a
commitment by the Government to improve the social well-being of a
tribe, but the tribe would have no claim against the Government if the
Government did not fund the trust fund. In that case, the trust fund
should be included in the Federal budget.
Characteristics indicating tribal ownership (non-budgetary):
The assets consist of funds that the tribe has voluntarily
deposited in the Treasury and requested that the Government
manage.
The income comes from royalties earned on natural resources
or businesses that are owned by the tribe.
Legislation specifies that a tribe owns the assets.
The assets derive from payment for settlement of a legally
enforceable claim i.e. ``a final judgement, award, or
compromise settlement under the provisions of title 31, United
States Code, Section 1304.''
Legislation allows a tribe to sue for damages if the
Government reneges on the terms of an agreement between the
tribe and the Government.
The tribe makes the fundamental decisions about how the
assets are spent or invested, with the stipulation that if the
tribe decides to invest in non-Treasury securities, it must
waive the Government's liability.
The tribe can pledge the assets or income as collateral for
loans.
Private creditors can place liens on the assets or income.
The terms of the agreement cannot be changed without the
prior consent of the tribe.
The assets are distributed automatically to the tribe or to
individual Indians.
The amount to be paid to the tribe depends on the amount of
assets in the fund (i.e., the Government does not guarantee a
certain benefit amount).
The settlement requires that the Government make a specific
dollar payment to the tribe (non-budgetary) as opposed to
requiring that the Government provide specific services for
the tribe's benefit (budgetary).
Characteristics indicating governmental ownership (budgetary):
Use of the assets is subject to future appropriation.
The Secretary of the Interior, or some other Government
official, makes the fundamental decisions about the use of the
assets.
The Government can unilaterally change the terms of the
agreement.
The Government can unilaterally withdraw or reallocate the
assets to another purpose.
The statute of limitations for filing a claim against the
Government has expired, eliminating the tribe's ability to
bring a takings suit against the Government.
The assets revert to the Government if they are not all
spent.
The settlement agreement requires the Government to provide
specific services for the tribe's benefit (budgetary), as
opposed to requiring the Government to make a specific dollar
payment to the tribe (non-budgetary).
The review conducted by OMB and Interior of the Indian tribal funds
indicated that two general types of funds should be reclassified as non-
budgetary: those funded from revenues generated by tribe-owned natural
resources and those funded by judgments against the United States
Government. The third general category, those derived from legislative
acts and for fulfilling Government obligations to tribes, included some
funds that should be reclassified as non-budgetary, and others that
should remain in the budget. These reclassifications became effective
October 1, 1999. OMB and Interior were not able to complete their review
of the Indian tribal funds before this date and will review the
remainder later this year. A description of the general categories of
Indian tribal funds and their proposed treatment follows.
Funds with assets derived from tribe-owned natural resources New
treatment: Non-budgetary fiduciary funds.
As shown in Table 15-3, an estimated $240 million in 631 Indian tribal
funds with assets derived from tribe-owned natural resources were
removed from the budget totals. These funds are owned by the tribes and
are managed by the Government in a fiduciary capacity. Tribes hold
beneficial title to the natural resources from which the income
originates, and thus own the resulting income. Some leases require the
royalties to be paid directly to one or more tribes or to individual
[[Page 350]]
Indians. In other cases, royalties are deposited in an Indian tribal
fund. Sometimes the lessee makes a single payment to a suspense account
(a type of deposit fund) for all three types of payments, and the
Department of the Interior subsequently determines what amount should be
paid to individuals, tribes, or an Indian tribal fund. At its
discretion, and subject to tribal law and the Secretary of the
Interior's fiduciary responsibilities, a tribe can withdraw its money
from the Indian tribal fund or leave it in the fund, where it is
invested by the Government.
Prior to the reclassification, these transactions were treated
differently for Federal budget purposes. Payments directly to individual
Indians or tribes were not included in the budget, while payments to the
Indian tribal funds were recorded in the budget as offsetting receipts.
Payments to suspense accounts were excluded from the budget, but the
eventual distributions of suspense account balances were recorded
consistent with the above treatment of payments to individual Indians,
tribes, and Indian tribal funds.
There is no apparent substantive reason to treat payments to the
Indian tribal funds differently from payments that are made directly to
individual Indians or tribes, or that first pass through suspense
accounts before going to individual Indians or tribes. The Government's
role as trustee is primarily to ensure that the funds are distributed
and managed correctly. The Government cannot take money from these funds
to use for other purposes.
Funds derived from judgments against the United States New treatment:
Non-budgetary fiduciary funds.
As shown in Table 15-3, approximately $1.3 billion in 700 Indian
tribal funds derived from judgment awards were removed from the budget
totals. These funds resulted from Indian Claims Commission awards or
U.S. Court of Claims awards, and were paid out of the Federal Claims,
Judgments, and Relief Act fund. Court decisions specify that these funds
are payments for property damages. As such, the Government could not
withdraw the funds and use them for other purposes without resurrecting
the claim against the Government. This also appears to be true in cases
where the settlement provides an endowment for a tribe and stipulates
that only the earnings can be spent. The tribe, not the Government, owns
the endowment, and the tribe receives the full benefit of earnings on
the endowment. Congress can revise the use plans that the tribe
develops, but it cannot change the judgment amount.
These funds are deposited in an Indian tribal fund until a use plan is
approved. The plan could require the money to be paid to individual
Indian accounts or to the tribes, or the funds could be held in the
Indian tribal fund until paid out for tribal activities specified in the
plan. Subject to approval by the Department of the Interior, the tribes
can withdraw and manage the funds themselves.
Funds derived from legislative acts and for fulfilling Government
obligations to tribes New treatment: Mixed Some non-budgetary fiduciary
funds but others on-budget special funds.
The funds in this category are diverse and the proposed budgetary
treatment is mixed. Some funds were created as a result of legislative
settlements, such as for water rights or land claims, and, like the
previous category, should be considered non-budgetary. Others are
composed of appropriated monies to make payments to tribes for public
policy goals, such as infrastructure development. If these funds did not
resolve a legal claim and were established in a manner that did not
convey ownership of the assets to the tribe, they continue to be
included in the budget. As shown in Table 15-3, $400 million of funds in
this category were removed from the budget totals; $682 million remain
in the budget.
The funds that remain in the budget fall into a few broad categories.
About $386 million were derived from Federal legislation that created a
corpus (principal amount) and provided that only interest accruing on
the corpus is available for obligation. Since tribes do not have access
to the corpus, and the fund was not established to settle a valid legal
claim against the Government, the question of ownership of the corpus is
raised. The classification of these funds has not been determined, and
OMB and Interior will review the legislation that established each of
these funds to determine ownership of the corpus. If it is determined
that the tribe owns the corpus, then the funds will be removed from the
budget totals. Otherwise, the funds will remain in the budget.
Another $178 million of the funds in this category are for legislative
settlements for which certain conditions must be met before ownership
transfers to the tribes. For example, tribes are sometimes required to
execute a waiver of claims and appropriate releases that must be
approved by the relevant Courts. Until these conditions are met, the
funds are the property of the Federal Government and are included in the
budget. After these conditions are met, the funds will be disbursed to
the appropriate tribal fiduciary fund, which will be recorded as budget
outlays.
The balance of the funds included in the budget consist of the
following: $58 million that has not been reviewed by OMB and Interior,
$52 million to carry out Secretarial obligations under legislative
settlements (e.g., to construct dams, deliver water, and pay penalties);
$6 million earmarked for education grants; and $2 million for gifts and
bequests.
Change in Future Budgetary Transactions as a Result of Reclassifying
Tribal Fiduciary Funds as Non-budgetary.--Excluding the transactions of
the tribal fiduciary funds from the budget will have little effect on
net Federal outlays in future years. As shown in Table 15-4, their
removal is estimated to increase net outlays, and decrease the unified
budget surplus, by approximately $40 million a year from 2000 to 2003.
[[Page 351]]
Removing the tribal fiduciary funds from the budget changes net
Federal outlays for future years in a number of ways. First, interest
payments on Treasury securities held by these funds, which are recorded
as intrabudgetary transactions through FY 1999, are recorded as
disbursements to the public beginning in FY 2000. Second, offsetting
receipts from the public are lowered by the royalties and other income
derived from tribe-owned natural resources. Third, the budget no longer
records the disbursement of these royalties and income from the
Government to the tribes. This reduces disbursements by the same amount
as offsetting receipts, but not necessarily in the same years.
Removing the Indian tribal funds from the budget also shifts the
timing of disbursements to the public resulting from Federal payments to
Indian tribes for judgments and settlements. In fiscal year 1999 and
prior years, these payments were not recorded as outlays to the public
until the funds were disbursed to the tribes. Beginning in FY 2000, the
payments are recorded as outlays to the public when the funds are paid
to the tribal fiduciary funds.
Improvements to Federal Budgeting.--The reclassification of the Indian
tribal funds is expected to improve Federal budgeting in three ways.
First, as previously mentioned, it will treat them in a manner
consistent with the budget concepts that are applied to other funds held
by the Government. Second, the budget will record costs in the
appropriate period the year that financial resources are transferred
from the Government to a tribe so that decision makers will take the
cost into account at the time that decisions are made. Flows into and
out of the tribal fiduciary funds will not be included in the budget and
therefore will not affect new resource allocation decisions by the
Government. Third, the tribal fiduciary funds will not be subject to
budgetary controls and constraints that are applied to funds that belong
to the Government.
Table 15-4. OUTLAY IMPACT OF RECLASSIFYING INDIAN TRIBAL FUNDS AS NON-BUDGETARY \1\
(In millions of dollars)
----------------------------------------------------------------------------------------------------------------
1999 2000 2001 2002 2003
----------------------------------------------------------------------------------------------------------------
Pre-2000 treatment of tribal trust funds:
Offsetting receipts from the public.............................. 324 334 338 342 346
Disbursement to the public....................................... 331 405 409 413 417
--------------------------------------------
Outlays, prior treatment......................................... 7 71 71 71 71
Effect of reclassifying tribal fiduciary funds as (non-budgetary):
Offsetting receipts from the public.............................. ....... -278 -278 -279 -279
Disbursement to the public....................................... ....... -237 -238 -238 -238
--------------------------------------------
Net impact of reclassification on outlays........................ ....... 41 40 41 41
Revised treatment of Indian tribal funds:
Offsetting receipts from the public.............................. 324 56 60 63 67
Disbursement to the public....................................... 331 168 171 175 179
--------------------------------------------
Outlays, revised treatment....................................... 7 112 111 112 112
----------------------------------------------------------------------------------------------------------------
\1\ Does not include intrabudgetary transactions.
[[Page 352]]
Table 15-5. INCOME, OUTGO, AND BALANCES OF MAJOR TRUST FUNDS
(In billions of dollars)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Estimate
1999 -----------------------------------------------------------------------
actual 2000 2001 2002 2003 2004 2005
--------------------------------------------------------------------------------------------------------------------------------------------------------
Airport and Airway Trust Fund
Balance, start of year.............................................. 9.4 12.4 13.3 14.1 15.7 17.5 19.4
Income:
Governmental receipts............................................. 10.4 9.2 10.6 12.0 12.6 13.4 14.1
Proprietary receipts.............................................. * * * * * * *
Receipts from Federal funds:
Interest........................................................ 0.7 0.8 0.8 0.8 0.9 1.0 1.1
Other........................................................... * 0.1 0.1 0.1 0.1 0.1 0.1
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 11.1 10.1 11.6 13.0 13.7 14.5 15.4
Outgo:
To the public..................................................... 8.1 9.3 10.8 11.4 11.9 12.6 13.3
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 8.1 9.3 10.8 11.4 11.9 12.6 13.3
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 2.3 0.1 0.0 0.8 0.9 0.9 1.0
Interest........................................................ 0.7 0.8 0.8 0.8 0.9 1.0 1.1
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 3.0 0.9 0.8 1.6 1.8 1.9 2.1
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... * -* .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 3.0 0.9 0.8 1.6 1.8 1.9 2.1
===================================================================================
Balance, end of year................................................ 12.4 13.3 14.1 15.7 17.5 19.4 21.5
Federal Employees Health Benefits Fund
Balance, start of year.............................................. 6.2 5.8 5.6 5.4 5.2 4.9 4.6
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. 4.9 5.3 5.7 6.1 6.4 6.8 7.2
Receipts from Federal funds:
Interest........................................................ 0.4 0.3 0.3 0.3 0.3 0.3 0.2
Other........................................................... 12.8 14.2 15.0 16.2 17.7 19.3 20.9
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 18.0 19.8 21.0 22.6 24.4 26.3 28.3
Outgo:
To the public..................................................... 18.5 20.0 21.1 22.8 24.7 26.7 28.7
Payments to Other funds........................................... -* .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 18.5 20.0 21.1 22.8 24.7 26.7 28.7
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. -0.8 -0.5 -0.4 -0.5 -0.5 -0.6 -0.6
Interest........................................................ 0.4 0.3 0.3 0.3 0.3 0.3 0.2
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. -0.4 -0.2 -0.1 -0.3 -0.2 -0.4 -0.4
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... -0.4 -0.2 -0.1 -0.3 -0.2 -0.4 -0.4
===================================================================================
Balance, end of year................................................ 5.8 5.6 5.4 5.2 4.9 4.6 4.2
Federal Civilian Employees Retirement Funds
Balance, start of year.............................................. 460.6 491.9 523.0 553.1 582.7 611.5 639.1
Income:
Governmental receipts............................................. 4.5 4.3 3.9 3.6 3.4 3.2 3.1
Proprietary receipts.............................................. .......... .......... .......... .......... .......... .......... ..........
Receipts from Federal funds:
Interest........................................................ 34.3 35.9 36.6 37.7 38.9 39.9 40.8
Other........................................................... 36.9 37.0 37.8 38.8 39.4 40.4 41.5
[[Page 353]]
Receipts from Trust funds......................................... .......... * * * * * *
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 75.7 77.2 78.3 80.1 81.7 83.5 85.3
Outgo:
To the public..................................................... 44.5 46.0 48.2 50.5 52.9 55.9 59.1
Payments to Other funds........................................... .......... * * * * * *
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 44.5 46.0 48.2 50.5 52.9 56.0 59.1
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. -3.1 -4.8 -6.4 -8.1 -10.1 -12.3 -14.5
Interest........................................................ 34.3 35.9 36.6 37.7 38.9 39.9 40.8
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 31.2 31.1 30.1 29.6 28.8 27.6 26.3
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 31.2 31.1 30.1 29.6 28.8 27.6 26.3
===================================================================================
Balance, end of year................................................ 491.9 523.0 553.1 582.7 611.5 639.1 665.3
Federal Old-Age, Survivors and Disability Insurance Trust Funds
Balance, start of year.............................................. 730.3 855.0 1004.3 1164.4 1337.8 1522.3 1717.0
Income:
Governmental receipts............................................. 444.5 476.8 499.9 522.2 544.2 566.7 598.6
Proprietary receipts.............................................. * 0.1 0.1 0.1 0.1 0.1 0.1
Receipts from Federal funds:
Interest........................................................ 52.1 59.7 68.1 77.6 87.9 98.8 110.5
Other........................................................... 20.7 21.9 21.5 22.6 23.8 25.3 27.1
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 517.3 558.4 589.6 622.5 656.1 690.9 736.2
Outgo:
To the public..................................................... 388.4 405.0 424.5 445.2 467.5 492.1 518.8
Payments to Other funds........................................... 4.1 4.0 5.1 4.0 4.0 4.1 4.1
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 392.6 409.0 429.5 449.2 471.5 496.1 522.8
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 72.6 89.7 91.9 95.7 96.6 95.9 102.9
Interest........................................................ 52.1 59.7 68.1 77.6 87.9 98.8 110.5
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 124.7 149.3 160.1 173.3 184.5 194.8 213.4
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... -* .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 124.7 149.3 160.1 173.3 184.5 194.8 213.4
===================================================================================
Balance, end of year................................................ 855.0 1004.3 1164.4 1337.8 1522.3 1717.0 1930.4
Foreign Military Sales Trust Fund
Balance, start of year.............................................. 6.0 5.5 5.5 5.5 5.5 5.5 5.5
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. 11.6 10.6 10.8 10.9 10.9 11.0 11.2
Receipts from Federal funds:
Interest........................................................ .......... .......... .......... .......... .......... .......... ..........
Other........................................................... .......... .......... .......... .......... .......... .......... ..........
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 11.6 10.6 10.8 10.9 10.9 11.0 11.2
Outgo:
To the public..................................................... 12.2 10.6 10.8 10.9 10.9 11.0 11.2
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 12.2 10.6 10.8 10.9 10.9 11.0 11.2
[[Page 354]]
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. -0.5 .......... .......... .......... .......... .......... ..........
Interest........................................................ .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. -0.5 .......... .......... .......... .......... .......... ..........
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... -0.5 .......... .......... .......... .......... .......... ..........
===================================================================================
Balance, end of year................................................ 5.5 5.5 5.5 5.5 5.5 5.5 5.5
Highway Trust Fund \1\
Balance, start of year.............................................. 18.6 29.0 31.4 32.3 33.0 34.1 36.1
Income:
Governmental receipts............................................. 39.3 34.3 35.1 36.0 36.3 36.9 37.7
Proprietary receipts.............................................. 0.1 0.1 0.1 0.1 0.1 0.1 0.1
Receipts from Federal funds:
Interest........................................................ .......... .......... .......... .......... .......... .......... ..........
Other........................................................... * * * * * * *
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, Income.............................................. 39.4 34.4 35.3 36.1 36.4 37.0 37.8
Outgo:
To the public..................................................... 29.0 32.0 34.5 35.4 35.2 35.1 35.2
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, Outgo............................................... 29.0 32.0 34.5 35.4 35.2 35.1 35.2
Change in fund balance:
Surplus or deficit:............................................... .......... .......... .......... .......... .......... .......... ..........
Excluding interest.............................................. 10.4 2.5 0.8 0.7 1.2 2.0 2.6
Interest........................................................ .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit.................................. 10.4 2.5 0.8 0.7 1.2 2.0 2.6
Adjustments:
Transfers/lapses (net).......................................... * .......... .......... .......... .......... .......... ..........
Other adjustments............................................... -* -* * .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, Change in fund balance................................... 10.4 2.5 0.8 0.7 1.2 2.0 2.6
===================================================================================
Balance, End of Year................................................ 29.0 31.4 32.3 33.0 34.1 36.1 38.7
Medicare: Federal Hospital Insurance (HI) Trust Fund
Balance, start of year.............................................. 116.9 138.4 163.4 201.3 240.1 271.3 302.1
Income:
Governmental receipts............................................. 132.3 136.6 143.8 150.4 156.8 163.4 172.7
Proprietary receipts.............................................. 1.4 1.4 1.4 1.8 2.0 2.2 2.5
Receipts from Federal funds:
Interest........................................................ 9.3 11.0 12.5 14.9 16.9 18.2 19.5
Solvency transfer............................................... .......... .......... 15.4 12.6 .......... .......... ..........
Other........................................................... 10.0 10.6 10.4 10.8 11.5 12.1 12.8
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 153.0 159.6 183.5 190.5 187.2 195.9 207.5
Outgo:
To the public..................................................... 131.5 134.6 145.7 151.7 155.9 165.1 176.7
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 131.5 134.6 145.7 151.7 155.9 165.1 176.7
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 12.2 14.0 25.3 23.9 14.4 12.6 11.3
Interest........................................................ 9.3 11.0 12.5 14.9 16.9 18.2 19.5
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 21.5 25.0 37.8 38.8 31.2 30.8 30.7
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
[[Page 355]]
Other adjustments............................................... -* -* .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 21.5 25.0 37.8 38.8 31.2 30.8 30.7
===================================================================================
Balance, end of year................................................ 138.4 163.4 201.3 240.1 271.3 302.1 332.8
Medicare: Federal Supplementary Medical Insurance (SMI) Trust Fund
Balance, start of year.............................................. 40.9 45.6 44.5 40.7 39.4 40.8 40.2
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. 20.2 20.4 21.7 23.8 33.8 39.1 44.3
Receipts from Federal funds:
Interest........................................................ 2.9 3.1 2.9 2.8 2.8 2.7 2.7
Other........................................................... 62.4 67.8 72.9 77.7 87.7 98.8 107.6
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 85.5 91.2 97.5 104.4 124.3 140.7 154.7
Outgo:
To the public..................................................... 80.7 92.4 101.3 105.7 122.9 141.3 156.8
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 80.7 92.4 101.3 105.7 122.9 141.3 156.8
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 1.8 -4.2 -6.7 -4.1 -1.3 -3.3 -4.8
Interest........................................................ 2.9 3.1 2.9 2.8 2.8 2.7 2.7
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 4.8 -1.2 -3.8 -1.3 1.4 -0.6 -2.1
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... .......... * .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 4.8 -1.2 -3.8 -1.3 1.4 -0.6 -2.1
===================================================================================
Balance, end of year................................................ 45.6 44.5 40.7 39.4 40.8 40.2 38.1
Military Retirement Fund
Balance, start of year.............................................. 145.5 151.9 158.5 164.9 171.6 178.6 185.9
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. .......... .......... .......... .......... .......... .......... ..........
Receipts from Federal funds:
Interest........................................................ 12.6 12.8 13.0 13.3 13.5 13.8 14.0
Other........................................................... 25.7 26.8 27.3 28.3 29.3 30.4 31.4
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 38.2 39.5 40.4 41.6 42.8 44.1 45.5
Outgo:
To the public..................................................... 31.9 32.9 33.9 34.9 35.8 36.8 37.8
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 31.9 32.9 33.9 34.9 35.8 36.8 37.8
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. -6.2 -6.2 -6.6 -6.5 -6.5 -6.5 -6.4
Interest........................................................ 12.6 12.8 13.0 13.3 13.5 13.8 14.0
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 6.3 6.6 6.4 6.7 7.0 7.3 7.7
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... .......... .......... * .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 6.3 6.6 6.4 6.7 7.0 7.3 7.7
===================================================================================
Balance, end of year................................................ 151.9 158.5 164.9 171.6 178.6 185.9 193.6
Railroad Retirement Trust Funds
Balance, start of year.............................................. 13.9 14.3 15.3 16.1 17.1 18.2 19.2
[[Page 356]]
Income:
Governmental receipts............................................. 4.1 4.3 4.3 4.4 4.5 4.5 4.6
Proprietary receipts.............................................. .......... .......... .......... .......... .......... .......... ..........
Receipts from Federal funds:
Interest........................................................ 0.3 1.1 1.1 1.2 1.3 1.3 1.4
Other........................................................... 0.5 0.4 0.3 0.3 0.3 0.4 0.4
Receipts from Trust funds......................................... 3.8 3.8 3.6 3.7 3.8 3.8 3.8
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 8.8 9.5 9.4 9.7 9.8 10.0 10.1
Outgo:
To the public..................................................... 8.2 8.2 8.3 8.4 8.5 8.7 8.8
Payments to Other funds........................................... 0.2 0.2 0.2 0.2 0.2 0.2 0.2
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 8.4 8.5 8.6 8.7 8.8 8.9 9.1
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 0.1 -0.1 -0.3 -0.2 -0.2 -0.3 -0.3
Interest........................................................ 0.3 1.1 1.1 1.2 1.3 1.3 1.4
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 0.4 1.0 0.8 1.0 1.0 1.1 1.1
Adjustments:
Transfers/lapses (net).......................................... * * * .......... .......... .......... ..........
Other adjustments............................................... .......... .......... * .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 0.4 1.0 0.9 1.0 1.0 1.1 1.1
===================================================================================
Balance, end of year................................................ 14.3 15.3 16.1 17.1 18.2 19.2 20.3
Unemployment Trust Fund
Balance, start of year.............................................. 71.0 77.7 85.9 93.6 98.9 102.4 105.4
Income:
Governmental receipts............................................. 26.5 28.2 30.3 31.6 32.8 33.7 36.5
Proprietary receipts.............................................. * * * * * * *
Receipts from Federal funds:
Interest........................................................ 4.8 4.9 5.3 5.6 5.8 5.9 6.1
Other........................................................... 0.4 0.4 0.5 0.5 0.5 0.5 0.6
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 31.7 33.5 36.0 37.8 39.2 40.1 43.1
Outgo:
To the public..................................................... 24.9 25.4 28.2 32.4 35.7 37.1 38.4
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 24.9 25.4 28.2 32.4 35.7 37.1 38.4
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 1.9 3.2 2.5 -0.3 -2.4 -2.9 -1.3
Interest........................................................ 4.8 4.9 5.3 5.6 5.8 5.9 6.1
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 6.7 8.2 7.8 5.3 3.4 3.0 4.7
Adjustments:
Transfers/lapses (net).......................................... -* -* -* .......... .......... .......... ..........
Other adjustments............................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 6.7 8.2 7.8 5.3 3.4 3.0 4.7
===================================================================================
Balance, end of year................................................ 77.7 85.9 93.6 98.9 102.4 105.4 110.1
Veterans Life Insurance Trust Funds
Balance, start of year.............................................. 13.7 13.7 13.6 13.4 13.1 12.7 12.3
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. 0.8 0.8 0.8 0.7 0.7 0.7 0.6
Receipts from Federal funds:
Interest........................................................ 1.1 1.1 1.0 1.0 0.9 0.9 0.9
Other........................................................... * * * * * * *
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
[[Page 357]]
Subtotal, income.............................................. 1.9 1.8 1.8 1.7 1.6 1.6 1.5
Outgo:
To the public..................................................... 1.9 2.0 2.0 2.0 2.0 2.0 1.9
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 1.9 2.0 2.0 2.0 2.0 2.0 1.9
Change in fund balance:
Surplus or deficit (-):...........................................
Excluding interest.............................................. -1.1 -1.2 -1.2 -1.3 -1.3 -1.3 -1.3
Interest........................................................ 1.1 1.1 1.0 1.0 0.9 0.9 0.9
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. -* -0.1 -0.2 -0.3 -0.4 -0.4 -0.5
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... -* -* * .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... -* -0.1 -0.2 -0.3 -0.4 -0.4 -0.5
===================================================================================
Balance, end of year................................................ 13.7 13.6 13.4 13.1 12.7 12.3 11.9
Other Trust Funds \2\
Balance, start of year.............................................. 30.1 34.5 35.5 35.9 38.4 40.9 43.3
Income:
Governmental receipts............................................. 2.6 3.1 4.0 4.0 4.0 4.1 4.1
Proprietary receipts.............................................. 7.0 3.5 3.4 3.0 3.0 3.1 3.2
Receipts from Federal funds:
Interest........................................................ 2.0 2.2 2.2 1.9 2.0 2.0 2.1
Other........................................................... 1.6 2.0 3.1 2.7 2.7 2.8 2.9
Receipts from Trust funds.........................................
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 13.2 10.8 12.8 11.5 11.8 12.0 12.2
Outgo:
To the public..................................................... 8.0 9.1 8.3 8.4 8.7 9.0 9.2
Payments to Other funds........................................... 0.5 0.6 3.8 0.6 0.6 0.6 0.7
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 8.5 9.6 12.1 9.0 9.3 9.6 9.9
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 2.6 -1.0 -1.5 0.6 0.5 0.4 0.3
Interest........................................................ 2.0 2.2 2.2 1.9 2.0 2.0 2.1
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 4.6 1.2 0.7 2.5 2.5 2.4 2.4
Adjustments:
Transfers/lapses (net).......................................... -* -0.1 -0.3 .......... .......... .......... ..........
Other adjustments............................................... .......... -* -* .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 4.6 1.1 0.4 2.5 2.5 2.4 2.4
===================================================================================
Balance, end of year................................................ 34.8 35.5 35.9 38.4 40.9 43.3 45.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Less than $50 million.
Note: Balances shown include committed and uncommitted cash balances.
\1\ Figures reflect two legislative changes to the Highway Trust Fund as per the Transportation Equity Act for the 21st Century (TEA-21): no
accumulation of interest earnings on fund balances beginning in 1999 and transfer of $8.2 billion in highway account cash balances to the General
fund.
\2\ The difference between 1999 end of year balance and 2000 start of year balance is due to the removal of most tribal trust funds from the budget
totals. See the discussion regarding changes in the budget classification of tribal trust funds in this chapter for additional information.
[[Page 358]]
Table 15-6. INCOME, OUTGO, AND BALANCES OF SELECTED FEDERAL FUNDS
(In billions of dollars)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Estimate
1999 -----------------------------------------------------------------------
actual 2000 2001 2002 2003 2004 2005
--------------------------------------------------------------------------------------------------------------------------------------------------------
Abandoned Mine Reclamation Fund
Balance, start of year.............................................. 1.6 1.7 1.8 1.9 2.0 2.1 2.3
Income:
Governmental receipts............................................. 0.3 0.3 0.3 0.3 0.3 0.3 0.3
Proprietary receipts.............................................. * * * * * * *
Receipts from Federal funds:
Interest........................................................ 0.1 0.1 0.1 0.1 0.1 0.1 0.1
Other........................................................... * .......... .......... .......... .......... .......... ..........
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 0.4 0.4 0.4 0.4 0.4 0.4 0.4
Outgo:
To the public..................................................... 0.3 0.3 0.3 0.2 0.2 0.3 0.3
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 0.3 0.3 0.3 0.2 0.2 0.3 0.3
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. * -* -* * 0.1 * *
Interest........................................................ 0.1 0.1 0.1 0.1 0.1 0.1 0.1
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 0.1 0.1 0.1 0.1 0.2 0.1 0.1
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... -* .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 0.1 0.1 0.1 0.1 0.2 0.1 0.1
===================================================================================
Balance, end of year................................................ 1.7 1.8 1.9 2.0 2.1 2.3 2.4
Nuclear Waste Disposal Fund
Balance, start of year.............................................. 7.3 7.9 9.1 10.1 10.9 11.7 12.5
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. 0.7 0.7 0.6 0.6 0.6 0.5 0.5
Receipts from Federal funds:
Interest........................................................ 0.1 0.7 0.8 0.9 0.9 1.0 0.9
Other........................................................... .......... .......... .......... .......... .......... .......... ..........
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 0.8 1.4 1.3 1.4 1.5 1.5 1.5
Outgo:
To the public..................................................... 0.2 0.2 0.3 0.7 0.7 0.7 0.7
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 0.2 0.2 0.3 0.7 0.7 0.7 0.7
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 0.5 0.5 0.2 -0.1 -0.1 -0.2 -0.2
Interest........................................................ 0.1 0.7 0.8 0.9 0.9 1.0 0.9
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 0.6 1.2 1.0 0.7 0.8 0.8 0.7
Adjustments:
Transfers/lapses (net).......................................... .......... .......... .......... .......... .......... .......... ..........
Other adjustments............................................... * .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 0.6 1.2 1.0 0.7 0.8 0.8 0.7
===================================================================================
Balance, end of year................................................ 7.9 9.1 10.1 10.9 11.7 12.5 13.2
Overseas Private Investment Corporation
Balance, start of year.............................................. 2.8 3.0 3.2 3.4 3.7 4.0 4.3
Income:
Governmental receipts............................................. .......... .......... .......... .......... .......... .......... ..........
Proprietary receipts.............................................. 0.1 0.1 0.1 0.1 0.1 0.1 0.1
[[Page 359]]
Receipts from Federal funds:
Interest........................................................ 0.2 0.2 0.2 0.2 0.2 0.3 0.3
Other........................................................... * * * * * * *
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 0.3 0.3 0.3 0.3 0.4 0.4 0.4
Outgo:
To the public..................................................... 0.1 0.2 0.1 0.1 0.1 0.1 0.1
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 0.1 0.2 0.1 0.1 0.1 0.1 0.1
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 0.1 -* * -0.1 -* -* -*
Interest........................................................ 0.2 0.2 0.2 0.3 0.3 0.3 0.3
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 0.3 0.2 0.3 0.3 0.3 0.3 0.3
Adjustments:
Transfers/lapses (net).......................................... -* -* -* .......... .......... .......... ..........
Other adjustments............................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 0.2 0.2 0.2 0.3 0.3 0.3 0.3
===================================================================================
Balance, end of year................................................ 3.0 3.2 3.4 3.7 4.0 4.3 4.6
Uranium Enrichment Decontamination and Decommissioning Fund
Balance, start of year.............................................. 1.3 1.7 2.1 2.4 2.8 3.2 3.6
Income:
Governmental receipts............................................. 0.2 0.2 0.2 0.2 0.2 0.2 0.2
Proprietary receipts.............................................. .......... .......... .......... .......... .......... .......... ..........
Receipts from Federal funds:
Interest........................................................ * * 0.1 0.1 0.1 0.1 0.1
Other........................................................... 0.4 0.4 0.4 0.4 0.4 0.4 0.4
Receipts from Trust funds......................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, income.............................................. 0.6 0.6 0.7 0.7 0.7 0.7 0.7
Outgo:
To the public..................................................... 0.2 0.2 0.3 0.3 0.3 0.3 0.3
Payments to Other funds........................................... .......... .......... .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Subtotal, outgo............................................... 0.2 0.2 0.3 0.3 0.3 0.3 0.3
Change in fund balance:
Surplus or deficit (-):
Excluding interest.............................................. 0.3 0.4 0.3 0.3 0.3 0.3 0.3
Interest........................................................ * * 0.1 0.1 0.1 0.1 0.1
-----------------------------------------------------------------------------------
Subtotal, surplus or deficit (-).............................. 0.4 0.4 0.4 0.4 0.4 0.4 0.4
Adjustments:
Transfers/lapses (net).......................................... .......... -* .......... .......... .......... .......... ..........
Other adjustments............................................... .......... * .......... .......... .......... .......... ..........
-----------------------------------------------------------------------------------
Total, change in fund balance................................... 0.4 0.4 0.4 0.4 0.4 0.4 0.4
===================================================================================
Balance, end of year................................................ 1.7 2.1 2.4 2.8 3.2 3.6 4.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Less than $50 million.
Note: Balances shown include committed and uncommitted cash balances.