[Congressional Record Volume 150, Number 131 (Tuesday, November 16, 2004)]
[Extensions of Remarks]
[Pages E1970-E1971]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                PROVIDING CBO COST ESTIMATE FOR H.R. 775

                                 ______
                                 

                    HON. F. JAMES SENSENBRENNER, JR.

                              of wisconsin

                    in the house of representatives

                       Tuesday, November 16, 2004

  Mr. SENSENBRENNER. Mr. Speaker, on October 6, 2004, the Committee on 
the Judiciary filed its report on H.R. 775, the ``Security and Fairness 
Enhancement for America Act of 2003.'' At that time, the Committee had 
not received a Congressional Budget Office cost estimate for the bill, 
and it filed the report with a committee cost estimate as provided in 
clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives. Subsequently, the Committee received the CBO cost 
estimate on H.R 775, and I am submitting it here for the Record.
                                                 October 27, 2004.
     Hon. F. James Sensenbrenner Jr.,
     Chairman, Committee on the Judiciary,
     House of Representatives, Washington, DC.
       Dear Mr. Chairman: The Congressional Budget Office has 
     prepared the enclosed cost estimate for H.R. 775, the 
     Security and Fairness Enhancement Act of 2003.
       If you wish further details on this estimate, we will be 
     pleased to provide them. The CBO staff contact is Joseph C. 
     Whitehill, who can be reached at 226-2840.
           Sincerely,
                                              Douglas Holtz-Eakin.
       Enclosure
     H.R. 775--Security and Fairness Enhancement Act of 2003
       Summary: H.R. 775 would eliminate the diversity immigrant 
     program. The costs of implementing that program are covered 
     by fees charged to winning applicants in a lottery for a 
     limited number of immigrant visas. The fees are credited to 
     State Department and Bureau of Citizenship and Immigration 
     Services (CIS) accounts as offsetting collections and 
     offsetting receipts, respectively. (Offsetting collections 
     are a credit against discretionary spending, while offsetting 
     receipts are a credit against direct spending.)
       CBO estimates that enacting the bill would decrease 
     collections and spending by the Department of State and the 
     CIS; however, changes in net spending by those agencies would 
     not be significant. Enacting H.R. 775 would lower the number 
     of persons eligible for food stamps and Medicaid benefits. 
     CBO estimates spending for those programs would be reduced by 
     $164 million over the 2005-2014 period. Enacting the bill 
     would not affect revenues.
       Each year, the Department of State issues about 50,000 
     immigrant visas under the diversity immigrant program to 
     natives of foreign states which the U.S. Attorney General 
     determines have had a low ratio of immigrants admitted under 
     the other sections of the immigration law. The immigrants are 
     selected randomly by the Secretary of State from among 
     persons who submit applications in a special lottery for the 
     visas. Persons apply in one fiscal year for visas to be 
     issued in the coming fiscal year. Applicants must meet 
     minimum requirements for education or work experience and 
     otherwise be eligible for immigrant visas as specified in the 
     Immigration and Nationality Act. Those selected in the 
     diversity lottery must obtain their visas by the end of the 
     fiscal year covered by the lottery.
       H.R. 775 contains no intergovernmental or private-sector 
     mandates as defined in the Unfunded Mandates Reform Act 
     (UMRA); CBO estimates that states would save about $45 
     million in Medicaid costs over the 2005-2014 period.
       Estimated cost to the Federal Government: The estimated 
     budgetary impact of H.R. 775 is shown in the following table. 
     The costs of this legislation fall within budget functions 
     550 (health) and function 600 (income security). In addition, 
     the bill would have an insignificant effect on net spending 
     in budget function 150 (international affairs) and budget 
     function 750 (administration of justice).

[[Page E1971]]



--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                        By fiscal year, in millions of dollars--
                                                               -----------------------------------------------------------------------------------------
                                                                  2005     2006     2007     2008     2009     2010     2011     2012     2013     2014
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING
 
Estimated Budget Authority....................................        *       -1       -3       -4       -5       -9      -18      -29      -41      -54
Estimated Outlays.............................................        *       -1       -3       -4       -5       -9      -18      -29      -41     -54
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note.--* = less than $500,000.

       Basis of estimate: For this estimate, CBO assumes the bill 
     will be enacted before the end of the calendar year 2004 and 
     that the restrictions on issuing new visas will take effect 
     immediately. By eliminating the diversity visa lottery, H.R. 
     775 would decrease the number of immigrants who become legal 
     permanent residents by about 44,000 each year--not all 
     persons selected immigrate to the United States within the 
     period in which the visas are valid. Fewer permanent legal 
     residents would, over time, lower the enrollment for benefits 
     under the Food Stamp and Medicaid programs and thus lower 
     estimated spending for those programs.
     Food Stamps
       While adult immigrants have a five-year waiting period for 
     benefits, legal permanent residents under the age of 18 are 
     automatically eligible for food stamps. CBO estimates that 
     there will be about 440,000 fewer legal permanent residents 
     over the 10-year period. Based on data from the Current 
     Population Survey on participation by noncitizens before the 
     changes in eligibility that were enacted in 1996, CBO 
     estimates that by 2009, 4,000 fewer children would receive 
     food stamps. Overall, CBO estimates that by 2014 about 23,000 
     fewer people would receive food stamps. Food Stamp program 
     costs would decrease by $13 million over the 2005-2009 period 
     and $105 million over the 2009-2014 period.
     Medicaid
       By decreasing the number of legal permanent residents, H.R. 
     775 would reduce the number of individuals enrolling in the 
     Medicaid program. Under Medicaid law, immigrants entering the 
     United States after August 22, 1996, are subject to a five-
     year ban from receiving Medicaid coverage. CBO expects that 
     certain participants in the diversity visa program (mainly 
     children, pregnant women, and some disabled people) will 
     qualify for Medicaid five years after entering the United 
     States. CBO estimates that by 2014, about 9,000 fewer people 
     would receive Medicaid than under current law and that 
     federal Medicaid spending would decrease by about $59 million 
     over the 2010-2014 period.
     State Department
       Applicants pay no fee for submitting an application to the 
     Department of State for the special lottery; however, there 
     is a $100 special processing fee payable to the Department of 
     State by persons whose entries are selected and processed at 
     a U.S. consulate. The applicants must also pay the regular 
     visa fees at the time of visa issuance. The special 
     processing fee generates about $5 million in offsetting 
     collections for the Department of State each year. The bill 
     would lower collections by the Department of State, but 
     spending would also decline by the amount of forgone 
     collections.
     Bureau of Citizenship and Immigration Services
       The CIS currently charges fees totaling $385 to register 
     each selected applicant as a permanent U.S. resident. CBO 
     estimates that CIS collects and spends about $20 million 
     annually in fees from diversity immigrants--a small fraction 
     of more than $1 billion in fees the agency collects and 
     spends each year to administer programs relating to the entry 
     of aliens. CBO estimates that eliminating the diversity visa 
     program would reduce fee collections by about $20 million 
     annually, but that spending would also decrease by an 
     equivalent amount, so there would be no significant net 
     budgetary effect.
       Estimated impact on State, local, and tribal governments: 
     H.R. 775 contains no intergovernmental mandates as defined in 
     UMRA. By decreasing the number of legal permanent residents 
     in the United States, the bill would reduce the number of 
     individuals enrolling in the Medicaid program. CBO estimates 
     that the change would result in a savings for states of about 
     $45 million over the 2005-2014 period.
       Estimated impact on the private sector: The bill contains 
     no new private-sector mandates as defined in UMRA.
       Estimate prepared by: Federal Costs: State Department: 
     Joseph C. Whitehill (226-2840). Citizen and Immigration 
     Services: Mark Grabowicz (226-2860). Food Stamps: Kathleen 
     FitzGerald (226-2820). Medicaid: Jeanne De Sa (226-9010). 
     Impact on State, Local, and Tribal Governments: Melissa 
     Merrell (225-3220). Impact on the Private Sector: Amina 
     Masood (226-2940).
       Estimate approved by: Peter H. Fontaine, Deputy Assistant 
     Director for Budget Analysis.

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