[Budget of the United States Government]
[III. Creating a Better Government]
[21. Undistributed Offsetting Receipts]
[From the U.S. Government Publishing Office, www.gpo.gov]
21. UNDISTRIBUTED OFFSETTING RECEIPTS
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Table 21-1. Undistributed Offsetting Receipts
(In millions of dollars)
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Estimate
Function 950 2000 -----------------------------------------------------------
Actual 2001 2002 2003 2004 2005 2006
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Spending:
Mandatory Outlays:
Existing law.......................... -42,581 -47,656 -51,803 -60,710 -62,399 -56,213 -57,761
Proposed legislation.................. ........ ........ 2,400 331 -8,184 -2,651 -4,617
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Undistributed offsetting receipts, totaling $49.4 billion in 2002,
fall into two categories: (1) the Government's receipts from performing
certain business-like activities, such as proceeds from oil and gas
leases on the Outer Continental Shelf; and (2) collections of Federal
agencies' contributions to Federal employees' retirement plans. Receipts
from all business-like activities are offset against budget authority
and outlays, instead of being recorded as governmental receipts, so that
the budget totals represent the amount of resources allocated by the
Government rather than by the market mechanism. Unlike most business-
like receipts, which are offset within the same function as the spending
that gives rise to the receipt, some are so large that it would distort
the functional totals to distribute them by function. Instead, they are
undistributed by function and offset against the budget totals.
Receipts of agency retirement contributions are offset against the
payments, so that the budget totals measure the Government's
transactions with the public. These intrabudgetary transactions are
important for allocating costs to programs that incur the cost, but they
have no net impact on total budget authority and outlays. They are
offset against total budget authority and outlays because offsetting
them within the functions in which the payments are recorded would cause
the totals for those functions to seriously understate current
expenditures.
Rents and Royalties on the Outer Continental Shelf (OCS)
The Department of the Interior's Outer Continental Shelf lands
leasing program, which began in 1954, currently generates about 26
percent of total U.S. domestic production and 27 percent of total
natural gas production. Since the OCS program's inception, it has held
131 lease sales, covering areas three to 200 miles offshore and
generating over $134 billion in rents, bonuses, and royalties--mainly
for the general fund of the Treasury--with an estimated $5.9 billion in
OCS receipts in 2002. OCS revenues also provide nearly all funding for
the Land and Water Conservation Fund.
Employee Retirement
In 2002, Federal agencies are expected to pay an estimated $41.6
billion on behalf of their employees to the Federal retirement trust
funds, \1\ the Medicare health insurance trust fund, and the Social
Security trust funds. As civilian and military employees' pay rises,
agencies must make commensurate increases in their payments to recognize
the rising cost of retirement. The amount of
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receipts also changes with increases or decreases in the number of
employees and changes in the retirement accruals charged to agencies.
The agency payments and trust fund receipts are offsetting and do not
affect the unified budget totals. Under the 1997 Balanced Budget Act,
agency contributions for employees covered by the Civil Service
Retirement System were increased from seven percent of salary to 8.51
percent beginning in 1998. These higher contributions are set to expire
in 2003.
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\1\ The major programs are the Military Retirement System, the Civil
Service Retirement System, and the Federal Employees' Retirement System.
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Spectrum Auction Receipts
In 1993, the President and Congress gave the Federal Communications
Commission (FCC) authority to assign spectrum licenses through
competitive bidding, which has proven to be a very efficient and
effective way to allocate this finite public resource. Since the
beginning of the auctions program, the FCC has auctioned over 14,300
licenses for over $31 billion in actual and expected cash receipts--
encouraging the development of innovative telecommunications services
and ensuring that the public receives compensation for the private use
of a public resource. Over the next five years, spectrum auctions are
expected to generate more than $25 billion in receipts.
The Administration is proposing authorization language that provides a
legislative framework for FCC to develop regulations that promote
clearing the spectrum in channels 60-69 (747-762 and 777-792 MHz) for
new wireless services in a manner that ensures incumbent broadcasters
are fairly compensated. The legislative language would also shift the
statutory deadline for the 60-69 auction from 2000 to 2004 and shift the
statutory deadline for the auction of channels 52-59 (698-746 MHz) from
2002 to 2006. As a result of the increased certainty about how and when
the spectrum in channels 60-69 will become available for new entrants
and shifting the deadlines for both auctions closer to when the spectrum
is expected to become available, revenues for these auctions are
expected to increase by $7.5 billion.
Arctic National Wildlife Refuge Lease Receipts
The Administration proposes to open up the coastal plain of the Arctic
National Wildlife Refuge in northern Alaska to environmentally sound oil
and natural gas leasing. The budget assumes leasing begins in 2004,
generating $2.4 billion in lease bonus bids, with the bid receipts
shared 50/50 with the State of Alaska. The remaining $1.2 billion would
be dedicated for research and development of solar and renewable energy
technology, to be conducted by the Department of Energy over seven
years.