[House Report 109-505]
[From the U.S. Government Publishing Office]



109th Congress                                            Rept. 109-505
                        HOUSE OF REPRESENTATIVES
 2d Session                                                      Part 2

======================================================================



 
                 LEGISLATIVE LINE ITEM VETO ACT OF 2006

                                _______
                                

 June 19, 2006.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Dreier, from the Committee on Rules, submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 4890]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Rules, to whom was referred the bill (H.R. 
4890) to amend the Congressional and Impoundment Control Act of 
1974 to provide for the expedited consideration of certain 
proposed rescissions of budget authority, having considered the 
same, report favorably thereon with an amendment and recommend 
that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Amendment........................................................     2
Purpose and Summary..............................................     8
Background and Need for Legislation..............................     9
Hearings.........................................................    12
Committee Consideration..........................................    12
Committee Votes..................................................    12
Committee Oversight Findings.....................................    12
Performance Goals and Objectives.................................    13
New Budget Authority, Entitlement Authority, and Tax Expenditures    13
Committee Cost Estimate..........................................    13
Congressional Budget Office Estimate.............................    13
Federal Mandates Statement.......................................    15
Advisory Committee Statement.....................................    15
Constitutional Authority Statement...............................    15
Applicability to Legislative Branch..............................    15
Section-by-Section Analysis of the Legislation...................    15
Changes in the Rules of the House Made by the Bill, as Reported..    26
Changes in Existing law Made by the Bill, as Reported............    26
Dissenting Views.................................................    56

                               Amendment

    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Legislative Line Item Veto Act of 
2006''.

SEC. 2. LEGISLATIVE LINE ITEM VETO.

  (a) In General.--Title X of the Congressional Budget and Impoundment 
Control Act of 1974 (2 U.S.C. 621 et seq.) is amended by striking all 
of part B (except for sections 1016 and 1013, which are redesignated as 
sections 1019 and 1020, respectively) and part C and inserting the 
following:

                  ``Part B--Legislative Line Item Veto

                       ``line item veto authority
  ``Sec. 1011. (a) Proposed Cancellations.--Within 45 calendar days 
after the enactment of any bill or joint resolution providing any 
discretionary budget authority, item of direct spending, or targeted 
tax benefit, the President may propose, in the manner provided in 
subsection (b), the cancellation of any dollar amount of such 
discretionary budget authority, item of direct spending, or targeted 
tax benefit. If the 45 calendar-day period expires during a period 
where either House of Congress stands adjourned sine die at the end of 
a Congress or for a period greater than 45 calendar days, the President 
may propose a cancellation under this section and transmit a special 
message under subsection (b) on the first calendar day of session 
following such a period of adjournment.
  ``(b) Transmittal of Special Message.--
          ``(1) Special message.--
                  ``(A) In general.--The President may transmit to the 
                Congress a special message proposing to cancel any 
                dollar amounts of discretionary budget authority, items 
                of direct spending, or targeted tax benefits.
                  ``(B) Contents of special message.--Each special 
                message shall specify, with respect to the 
                discretionary budget authority, items of direct 
                spending proposed, or targeted tax benefits to be 
                canceled--
                          ``(i) the dollar amount of discretionary 
                        budget authority, the specific item of direct 
                        spending (that OMB, after consultation with 
                        CBO, estimates to increase budget authority or 
                        outlays as required by section 1017(9)), or the 
                        targeted tax benefit that the President 
                        proposes be canceled;
                          ``(ii) any account, department, or 
                        establishment of the Government to which such 
                        discretionary budget authority is available for 
                        obligation, and the specific project or 
                        governmental functions involved;
                          ``(iii) the reasons why such discretionary 
                        budget authority, item of direct spending, or 
                        targeted tax benefit should be canceled;
                          ``(iv) to the maximum extent practicable, the 
                        estimated fiscal, economic, and budgetary 
                        effect (including the effect on outlays and 
                        receipts in each fiscal year) of the proposed 
                        cancellation;
                          ``(v) to the maximum extent practicable, all 
                        facts, circumstances, and considerations 
                        relating to or bearing upon the proposed 
                        cancellation and the decision to effect the 
                        proposed cancellation, and the estimated effect 
                        of the proposed cancellation upon the objects, 
                        purposes, or programs for which the 
                        discretionary budget authority, item of direct 
                        spending, or the targeted tax benefit is 
                        provided;
                          ``(vi) a numbered list of cancellations to be 
                        included in an approval bill that, if enacted, 
                        would cancel discretionary budget authority, 
                        items of direct spending, or targeted tax 
                        benefits proposed in that special message; and
                          ``(vii) if the special message is transmitted 
                        subsequent to or at the same time as another 
                        special message, a detailed explanation why the 
                        proposed cancellations are not substantially 
                        similar to any other proposed cancellation in 
                        such other message.
                  ``(C) Duplicative proposals prohibited.--The 
                President may not propose to cancel the same or 
                substantially similar discretionary budget authority, 
                item of direct spending, or targeted tax benefit more 
                than one time under this Act.
                  ``(D) Maximum number of special messages.--The 
                President may not transmit to the Congress more than 5 
                special messages under this subsection related to any 
                bill or joint resolution described in subsection (a), 
                but may transmit not more than 10 special messages for 
                any omnibus budget reconciliation or appropriation 
                measure.
          ``(2) Enactment of approval bill.--
                  ``(A) Deficit reduction.--Amounts of budget 
                authority, items of direct spending, or targeted tax 
                benefits which are canceled pursuant to enactment of a 
                bill as provided under this section shall be dedicated 
                only to reducing the deficit or increasing the surplus.
                  ``(B) Adjustment of levels in the concurrent 
                resolution on the budget.--Not later than 5 days after 
                the date of enactment of an approval bill as provided 
                under this section, the chairs of the Committees on the 
                Budget of the Senate and the House of Representatives 
                shall revise allocations and aggregates and other 
                appropriate levels under the appropriate concurrent 
                resolution on the budget to reflect the cancellation, 
                and the applicable committees shall report revised 
                suballocations pursuant to section 302(b), as 
                appropriate.
                  ``(C) Adjustments to statutory limits.--After 
                enactment of an approval bill as provided under this 
                section, the Office of Management and Budget shall 
                revise applicable limits under the Balanced Budget and 
                Emergency Deficit Control Act of 1985, as appropriate.
                ``procedures for expedited consideration
  ``Sec. 1012. (a) Expedited Consideration.--
          ``(1) In general.--The majority leader of each House or his 
        designee shall (by request) introduce an approval bill as 
        defined in section 1017 not later than the fifth day of session 
        of that House after the date of receipt of a special message 
        transmitted to the Congress under section 1011(b).
          ``(2) Consideration in the house of representatives.--
                  ``(A) Referral and reporting.--Any committee of the 
                House of Representatives to which an approval bill is 
                referred shall report it to the House without amendment 
                not later than the seventh legislative day after the 
                date of its introduction. If a committee fails to 
                report the bill within that period or the House has 
                adopted a concurrent resolution providing for 
                adjournment sine die at the end of a Congress, it shall 
                be in order to move that the House discharge the 
                committee from further consideration of the bill. Such 
                a motion shall be in order only at a time designated by 
                the Speaker in the legislative schedule within two 
                legislative days after the day on which the proponent 
                announces his intention to offer the motion. Such a 
                motion shall not be in order after a committee has 
                reported an approval bill with respect to that special 
                message or after the House has disposed of a motion to 
                discharge with respect to that special message. The 
                previous question shall be considered as ordered on the 
                motion to its adoption without intervening motion 
                except twenty minutes of debate equally divided and 
                controlled by the proponent and an opponent. If such a 
                motion is adopted, the House shall proceed immediately 
                to consider the approval bill in accordance with 
                subparagraph (C). A motion to reconsider the vote by 
                which the motion is disposed of shall not be in order.
                  ``(B) Proceeding to consideration.--After an approval 
                bill is reported or a committee has been discharged 
                from further consideration, or the House has adopted a 
                concurrent resolution providing for adjournment sine 
                die at the end of a Congress, it shall be in order to 
                move to proceed to consider the approval bill in the 
                House. Such a motion shall be in order only at a time 
                designated by the Speaker in the legislative schedule 
                within two legislative days after the day on which the 
                proponent announces his intention to offer the motion. 
                Such a motion shall not be in order after the House has 
                disposed of a motion to proceed with respect to that 
                special message. The previous question shall be 
                considered as ordered on the motion to its adoption 
                without intervening motion. A motion to reconsider the 
                vote by which the motion is disposed of shall not be in 
                order.
                  ``(C) Consideration.--The approval bill shall be 
                considered as read. All points of order against an 
                approval bill and against its consideration are waived. 
                The previous question shall be considered as ordered on 
                an approval bill to its passage without intervening 
                motion except five hours of debate equally divided and 
                controlled by the proponent and an opponent and one 
                motion to limit debate on the bill. A motion to 
                reconsider the vote on passage of the bill shall not be 
                in order.
                  ``(D) Senate bill.--An approval bill received from 
                the Senate shall not be referred to committee.
          ``(3) Consideration in the senate.--
                  ``(A) Motion to proceed to consideration.--A motion 
                to proceed to the consideration of a bill under this 
                subsection in the Senate shall not be debatable. It 
                shall not be in order to move to reconsider the vote by 
                which the motion to proceed is agreed to or disagreed 
                to.
                  ``(B) Limits on debate.--Debate in the Senate on a 
                bill under this subsection, and all debatable motions 
                and appeals in connection therewith (including debate 
                pursuant to subparagraph (D)), shall not exceed 10 
                hours, equally divided and controlled in the usual 
                form.
                  ``(C) Appeals.--Debate in the Senate on any debatable 
                motion or appeal in connection with a bill under this 
                subsection shall be limited to not more than 1 hour, to 
                be equally divided and controlled in the usual form.
                  ``(D) Motion to limit debate.--A motion in the Senate 
                to further limit debate on a bill under this subsection 
                is not debatable.
                  ``(E) Motion to recommit.--A motion to recommit a 
                bill under this subsection is not in order.
                  ``(F) Consideration of the house bill.--
                          ``(i) In general.--If the Senate has received 
                        the House companion bill to the bill introduced 
                        in the Senate prior to the vote required under 
                        paragraph (1)(C), then the Senate may consider, 
                        and the vote under paragraph (1)(C) may occur 
                        on, the House companion bill.
                          ``(ii) Procedure after vote on senate bill.--
                        If the Senate votes, pursuant to paragraph 
                        (1)(C), on the bill introduced in the Senate, 
                        then immediately following that vote, or upon 
                        receipt of the House companion bill, the House 
                        bill shall be deemed to be considered, read the 
                        third time, and the vote on passage of the 
                        Senate bill shall be considered to be the vote 
                        on the bill received from the House.
  ``(b) Amendments Prohibited.--No amendment to, or motion to strike a 
provision from, a bill considered under this section shall be in order 
in either the Senate or the House of Representatives.
                   ``presidential deferral authority
  ``Sec. 1013. (a) Temporary Presidential Authority to Withhold 
Discretionary Budget Authority.--
          ``(1) In general.--At the same time as the President 
        transmits to the Congress a special message pursuant to section 
        1011(b), the President may direct that any dollar amount of 
        discretionary budget authority to be canceled in that special 
        message shall not be made available for obligation for a period 
        not to exceed 45 calendar days from the date the President 
        transmits the special message to the Congress.
          ``(2) Early availability.--The President shall make any 
        dollar amount of discretionary budget authority deferred 
        pursuant to paragraph (1) available at a time earlier than the 
        time specified by the President if the President determines 
        that continuation of the deferral would not further the 
        purposes of this Act.
  ``(b) Temporary Presidential Authority to Suspend Direct Spending.--
          ``(1) In general.--At the same time as the President 
        transmits to the Congress a special message pursuant to section 
        1011(b), the President may suspend the implementation of any 
        item of direct spending proposed to be canceled in that special 
        message for a period not to exceed 45 calendar days from the 
        date the President transmits the special message to the 
        Congress.
          ``(2) Early availability.--The President shall terminate the 
        suspension of any item of direct spending at a time earlier 
        than the time specified by the President if the President 
        determines that continuation of the suspension would not 
        further the purposes of this Act.
  ``(c) Temporary Presidential Authority to Suspend a Targeted Tax 
Benefit.--
          ``(1) In general.--At the same time as the President 
        transmits to the Congress a special message pursuant to section 
        1011(b), the President may suspend the implementation of any 
        targeted tax benefit proposed to be repealed in that special 
        message for a period not to exceed 45 calendar days from the 
        date the President transmits the special message to the 
        Congress.
          ``(2) Early availability.--The President shall terminate the 
        suspension of any targeted tax benefit at a time earlier than 
        the time specified by the President if the President determines 
        that continuation of the suspension would not further the 
        purposes of this Act.
  ``(d) Extension of 45-day Period.--The President may transmit to the 
Congress not more than one supplemental special message to extend the 
period to suspend the implementation of any discretionary budget 
authority, item of direct spending, or targeted tax benefit, as 
applicable, by an additional 45 calendar days. Any such supplemental 
message may not be transmitted to the Congress before the 40th day of 
the 45-day period set forth in the preceding message or later than the 
last day of such period.
               ``identification of targeted tax benefits
  ``Sec. 1014. (a) Statement.--The chairman of the Committee on Ways 
and Means of the House of Representatives and the chairman of the 
Committee on Finance of the Senate acting jointly (hereafter in this 
subsection referred to as the `chairmen') shall review any revenue or 
reconciliation bill or joint resolution which includes any amendment to 
the Internal Revenue Code of 1986 that is being prepared for filing by 
a committee of conference of the two Houses, and shall identify whether 
such bill or joint resolution contains any targeted tax benefits. The 
chairmen shall provide to the committee of conference a statement 
identifying any such targeted tax benefits or declaring that the bill 
or joint resolution does not contain any targeted tax benefits. Any 
such statement shall be made available to any Member of Congress by the 
chairmen immediately upon request.
  ``(b) Statement Included in Legislation.--
          ``(1) In general.--Notwithstanding any other rule of the 
        House of Representatives or any rule or precedent of the 
        Senate, any revenue or reconciliation bill or joint resolution 
        which includes any amendment to the Internal Revenue Code of 
        1986 reported by a committee of conference of the two Houses 
        may include, as a separate section of such bill or joint 
        resolution, the information contained in the statement of the 
        chairmen, but only in the manner set forth in paragraph (2).
          ``(2) Applicability.--The separate section permitted under 
        subparagraph (A) shall read as follows: `Section 1021 of the 
        Congressional Budget and Impoundment Control Act of 1974 shall 
        ________ apply to ____________.', with the blank spaces being 
        filled in with--
                  ``(A) in any case in which the chairmen identify 
                targeted tax benefits in the statement required under 
                subsection (a), the word `only' in the first blank 
                space and a list of all of the specific provisions of 
                the bill or joint resolution identified by the chairmen 
                in such statement in the second blank space; or
                  ``(B) in any case in which the chairmen declare that 
                there are no targeted tax benefits in the statement 
                required under subsection (a), the word `not' in the 
                first blank space and the phrase `any provision of this 
                Act' in the second blank space.
  ``(c) President's Authority.--If any revenue or reconciliation bill 
or joint resolution is signed into law--
          ``(1) with a separate section described in subsection (b)(2), 
        then the President may use the authority granted in this 
        section only with respect to any targeted tax benefit in that 
        law, if any, identified in such separate section; or
          ``(2) without a separate section described in subsection 
        (b)(2), then the President may use the authority granted in 
        this section with respect to any targeted tax benefit in that 
        law.
                      ``treatment of cancellations
  ``Sec. 1015. The cancellation of any dollar amount of discretionary 
budget authority, item of direct spending, or targeted tax benefit 
shall take effect only upon enactment of the applicable approval bill. 
If an approval bill is not enacted into law before the end of the 
applicable period under section 1013, then all proposed cancellations 
contained in that bill shall be null and void and any such dollar 
amount of discretionary budget authority, item of direct spending, or 
targeted tax benefit shall be effective as of the original date 
provided in the law to which the proposed cancellations applied.
                    ``reports by comptroller general
  ``Sec. 1016. With respect to each special message under this part, 
the Comptroller General shall issue to the Congress a report 
determining whether any discretionary budget authority is not made 
available for obligation or item of direct spending or targeted tax 
benefit continues to be suspended after the deferral authority set 
forth in section 1013 of the President has expired.
                             ``definitions
  ``Sec. 1017. As used in this part:
          ``(1) Appropriation law.--The term `appropriation law' means 
        an Act referred to in section 105 of title 1, United States 
        Code, including any general or special appropriation Act, or 
        any Act making supplemental, deficiency, or continuing 
        appropriations, that has been signed into law pursuant to 
        Article I, section 7, of the Constitution of the United States.
          ``(2) Approval bill.--The term `approval bill' means a bill 
        or joint resolution which only approves proposed cancellations 
        of dollar amounts of discretionary budget authority, items of 
        new direct spending, or targeted tax benefits in a special 
        message transmitted by the President under this part and--
                  ``(A) the title of which is as follows: `A bill 
                approving the proposed cancellations transmitted by the 
                President on ____', the blank space being filled in 
                with the date of transmission of the relevant special 
                message and the public law number to which the message 
                relates;
                  ``(B) which does not have a preamble; and
                  ``(C) which provides only the following after the 
                enacting clause: `That the Congress approves of 
                proposed cancellations ____', the blank space being 
                filled in with a list of the cancellations contained in 
                the President's special message, `as transmitted by the 
                President in a special message on ____', the blank 
                space being filled in with the appropriate date, 
                `regarding ____.', the blank space being filled in with 
                the public law number to which the special message 
                relates;
                  ``(D) which only includes proposed cancellations that 
                are estimated by CBO to meet the definition of 
                discretionary budgetary authority or items of direct 
                spending, or that are identified as targeted tax 
                benefits pursuant to section 1014;
                  ``(E) if any proposed cancellation other than 
                discretionary budget authority or targeted tax benefits 
                is estimated by CBO to not meet the definition of item 
                of direct spending, then the approval bill shall 
                include at the end: `The President shall cease the 
                suspension of the implementation of the following under 
                section 1013 of the Legislative Line Item Veto Act of 
                2006: ____', the blank space being filled in with the 
                list of such proposed cancellations; and
                  ``(F) if no CBO estimate is available, then the 
                entire list of legislative provisions proposed by the 
                President is inserted in the second blank space in 
                subparagraph (C).
          ``(3) Calendar day.--The term `calendar day' means a standard 
        24-hour period beginning at midnight.
          ``(4) Cancel or cancellation.--The terms `cancel' or 
        `cancellation' means to prevent--
                  ``(A) budget authority from having legal force or 
                effect;
                  ``(B) in the case of entitlement authority, to 
                prevent the specific legal obligation of the United 
                States from having legal force or effect;
                  ``(C) in the case of the food stamp program, to 
                prevent the specific provision of law that provides 
                such benefit from having legal force or effect; or
                  ``(D) a targeted tax benefit from having legal force 
                or effect; and
        to make any necessary, conforming statutory change to ensure 
        that such targeted tax benefit is not implemented and that any 
        budgetary resources are appropriately canceled.
          ``(5) CBO.--The term `CBO' means the Director of the 
        Congressional Budget Office.
          ``(6) Direct spending.--The term `direct spending' means--
                  ``(A) budget authority provided by law (other than an 
                appropriation law);
                  ``(B) entitlement authority; and
                  ``(C) the food stamp program.
          ``(7) Dollar amount of discretionary budget authority.--(A) 
        Except as provided in subparagraph (B), the term `dollar amount 
        of discretionary budget authority' means the entire dollar 
        amount of budget authority--
                  ``(i) specified in an appropriation law, or the 
                entire dollar amount of budget authority or obligation 
                limitation required to be allocated by a specific 
                proviso in an appropriation law for which a specific 
                dollar figure was not included;
                  ``(ii) represented separately in any table, chart, or 
                explanatory text included in the statement of managers 
                or the governing committee report accompanying such 
                law;
                  ``(iii) required to be allocated for a specific 
                program, project, or activity in a law (other than an 
                appropriation law) that mandates the expenditure of 
                budget authority from accounts, programs, projects, or 
                activities for which budget authority is provided in an 
                appropriation law;
                  ``(iv) represented by the product of the estimated 
                procurement cost and the total quantity of items 
                specified in an appropriation law or included in the 
                statement of managers or the governing committee report 
                accompanying such law; or
                  ``(v) represented by the product of the estimated 
                procurement cost and the total quantity of items 
                required to be provided in a law (other than an 
                appropriation law) that mandates the expenditure of 
                budget authority from accounts, programs, projects, or 
                activities for which budget authority is provided in an 
                appropriation law.
          ``(B) The term `dollar amount of discretionary budget 
        authority' does not include--
                  ``(i) direct spending;
                  ``(ii) budget authority in an appropriation law which 
                funds direct spending provided for in other law;
                  ``(iii) any existing budget authority canceled in an 
                appropriation law; or
                  ``(iv) any restriction, condition, or limitation in 
                an appropriation law or the accompanying statement of 
                managers or committee reports on the expenditure of 
                budget authority for an account, program, project, or 
                activity, or on activities involving such expenditure.
          ``(8) Item of direct spending.--The term `item of direct 
        spending' means any provision of law that results in an 
        increase in budget authority or outlays for direct spending 
        relative to the most recent levels calculated consistent with 
        the methodology used to calculate a baseline under section 257 
        of the Balanced Budget and Emergency Deficit Control Act of 
        1985 and included with a budget submission under section 
        1105(a) of title 31, United States Code, in the first year or 
        the 5-year period for which the item is effective. However, 
        such item does not include an extension or reauthorization of 
        existing direct spending, but instead only refers to provisions 
        of law that increase such direct spending.
          ``(9) OMB.--The term `OMB' means the Director of the Office 
        of Management and Budget.
          ``(10) Omnibus reconciliation or appropriation measure.--The 
        term `omnibus reconciliation or appropriation measure' means--
                  ``(A) in the case of a reconciliation bill, any such 
                bill that is reported to its House by the Committee on 
                the Budget; or
                  ``(B) in the case of an appropriation measure, any 
                such measure that provides appropriations for programs, 
                projects, or activities falling within 2 or more 
                section 302(b) suballocations.
          ``(11) Targeted tax benefit.--(A) The term `targeted tax 
        benefit' means any revenue-losing provision that provides a 
        Federal tax deduction, credit, exclusion, or preference to only 
        one beneficiary (determined with respect to either present law 
        or any provision of which the provision is a part) under the 
        Internal Revenue Code of 1986 in any year for which the 
        provision is in effect;
          ``(B) for purposes of subparagraph (A)--
                  ``(i) all businesses and associations that are 
                members of the same controlled group of corporations 
                (as defined in section 1563(a) of the Internal Revenue 
                Code of 1986) shall be treated as a single beneficiary;
                  ``(ii) all shareholders, partners, members, or 
                beneficiaries of a corporation, partnership, 
                association, or trust or estate, respectively, shall be 
                treated as a single beneficiary;
                  ``(iii) all employees of an employer shall be treated 
                as a single beneficiary;
                  ``(iv) all qualified plans of an employer shall be 
                treated as a single beneficiary;
                  ``(v) all beneficiaries of a qualified plan shall be 
                treated as a single beneficiary;
                  ``(vi) all contributors to a charitable organization 
                shall be treated as a single beneficiary;
                  ``(vii) all holders of the same bond issue shall be 
                treated as a single beneficiary; and
                  ``(viii) if a corporation, partnership, association, 
                trust or estate is the beneficiary of a provision, the 
                shareholders of the corporation, the partners of the 
                partnership, the members of the association, or the 
                beneficiaries of the trust or estate shall not also be 
                treated as beneficiaries of such provision;
          ``(C) for the purpose of this paragraph, the term `revenue-
        losing provision' means any provision that is estimated to 
        result in a reduction in Federal tax revenues (determined with 
        respect to either present law or any provision of which the 
        provision is a part) for any one of the two following periods--
                  ``(i) the first fiscal year for which the provision 
                is effective; or
                  ``(ii) the period of the 5 fiscal years beginning 
                with the first fiscal year for which the provision is 
                effective; and
          ``(D) the terms used in this paragraph shall have the same 
        meaning as those terms have generally in the Internal Revenue 
        Code of 1986, unless otherwise expressly provided.
                              ``expiration
  ``Sec. 1018. This title shall have no force or effect on or after 
October 1, 2012.''.

SEC. 3. TECHNICAL AND CONFORMING AMENDMENTS.

  (a) Exercise of Rulemaking Powers.--Section 904 of the Congressional 
Budget Act of 1974 (2 U.S.C. 621 note) is amended--
          (1) in subsection (a), by striking ``1017'' and inserting 
        ``1012''; and
          (2) in subsection (d), by striking ``section 1017'' and 
        inserting ``section 1012''.
  (b) Analysis by Congressional Budget Office.--Section 402 of the 
Congressional Budget Act of 1974 is amended by inserting ``(a)'' after 
``402.'' and by adding at the end the following new subsection:
   ``(b) Upon the receipt of a special message under section 1011 
proposing to cancel any item of direct spending, the Director of the 
Congressional Budget Office shall prepare an estimate of the savings in 
budget authority or outlays resulting from such proposed cancellation 
relative to the most recent levels calculated consistent with the 
methodology used to calculate a baseline under section 257 of the 
Balanced Budget and Emergency Deficit Control Act of 1985 and included 
with a budget submission under section 1105(a) of title 31, United 
States Code, and transmit such estimate to the chairmen of the 
Committees on the Budget of the House of Representatives and Senate.''.
  (c) Clerical Amendments.--(1) Section 1(a) of the Congressional 
Budget and Impoundment Control Act of 1974 is amended by striking the 
last sentence.
  (2) Section 1020(c) of such Act (as redesignated) is amended is 
amended by striking ``rescinded or that is to be reserved'' and insert 
``canceled'' and by striking ``1012'' and inserting ``1011''.
  (3) Table of Contents.--The table of contents set forth in section 
1(b) of the Congressional Budget and Impoundment Control Act of 1974 is 
amended by striking the contents for parts B and C of title X and 
inserting the following:

                  ``Part B--Legislative Line Item Veto

``Sec. 1011. Line item veto authority.
``Sec. 1012. Procedures for expedited consideration.
``Sec. 1013. Presidential deferral authority.
``Sec. 1014. Identification of targeted tax benefits.
``Sec. 1015. Treatment of cancellations.
``Sec. 1016. Reports by Comptroller General.
``Sec. 1017. Definitions.
``Sec. 1018. Expiration.
``Sec. 1019. Suits by Comptroller General.
``Sec. 1020. Proposed deferrals of budget authority.''.
  (d) Effective Date.--The amendments made by this Act shall take 
effect on the date of its enactment and apply only to any dollar amount 
of discretionary budget authority, item of direct spending, or targeted 
tax benefit provided in an Act enacted on or after the date of 
enactment of this Act.

SEC. 4. SENSE OF CONGRESS ON ABUSE OF PROPOSED CANCELLATIONS.

  It is the sense of Congress no President or any executive branch 
official should condition the inclusion or exclusion or threaten to 
condition the inclusion or exclusion of any proposed cancellation in 
any special message under this section upon any vote cast or to be cast 
by any Member of either House of Congress.

                          Purpose and Summary

    H.R. 4890, the Legislative Line Item Veto Act of 2006, 
amends the Congressional Budget and Impoundment Control Act of 
1974 (2 U.S.C. 621 et seq.) to provide an expedited rescission 
procedure which allows the President to cancel items of 
discretionary spending, mandatory spending, and limited tax 
benefits in bills and joint resolutions presented to the 
President by Congress.
    The bill provides the President with this authority while 
adhering to the presentment clause of article I, section 7 of 
the Constitution and protecting the basic separation of powers, 
as prescribed in the Constitution, by requiring that such 
cancellations will not take effect until approved by Congress.
    The bill also allows the President to temporarily withhold 
discretionary budget authority proposed for cancellation and 
suspend items of direct spending and targeted tax benefits for 
45 days so that Congress may consider the proposed 
cancellations under expedited procedures within that temporary 
deferral period.
    Under those procedures, a message must be transmitted to 
the Congress by the President within 45 calendar days of the 
enactment of legislation containing the items proposed for 
cancellation. Within five days of receiving a special message, 
the majority leaders of the House and Senate (or their 
designees) are required to introduce a bill or joint resolution 
to approve the proposed cancellations. That approval bill would 
be considered under expedited procedures.

                  Background and Need for Legislation

    In the recurrent discussion about the need to curtail 
Federal spending and control the Federal debt, various 
budgetary enforcement proposals have been frequent and 
controversial topics of debate by Congress. President Bush, 
like his recent predecessors, has called for line item veto 
authority to reduce wasteful spending and ensure accountability 
and transparency in the expenditure of taxpayer funds. In 
recent Congresses, the House considered several variations on 
the theme of enhancing Presidential authority in the budget 
process by allowing for expedited procedures in cancelling 
specific Federal spending or targeted tax benefits. But while 
the House has approved several measures under the guise of 
tightening control over spending, it has consistently missed 
opportunities to implement an effective item veto or expedited 
rescission authority that passes constitutional muster. The 
109th Congress however, has been marked by a renewed effort to 
strengthen the President's authority in excising unnecessary or 
wasteful spending, and to enhance the accountability of both 
the Congress and the President. This bill is direct result of 
that effort.
    The existing rescissions process was born with the 
enactment of the Congressional Budget and Impoundment Control 
Act of 1974. Title X of that Act comprised the Impoundment 
Control Act (ICA), which designated two categories of 
impoundments: deferrals and rescissions. That legislation was 
enacted in response to increasing conflict between the 
Legislative and Executive branches regarding the ability of the 
President to withhold funds that had previously been 
appropriated by Congress for specific programs or policies. 
With the enactment of the ICA, the Congress set parameters for 
the President to temporarily delay funding availability 
(deferrals) or propose that funding be permanently canceled 
(rescissions). A series of court rulings and subsequent 
legislation has effectively curtailed the deferral authority to 
prevent deferrals for policy reasons, while leaving the 
rescissions authority intact. Under the current framework 
established by the ICA of 1974, whenever the President wants to 
rescind budget authority, he must transmit a special message to 
Congress and obtain the support of both Houses within 45 days 
of continuous session. If denied congressional approval during 
this time period, the President must make the budget authority 
available to executive agencies for obligation and expenditure.
    Over the years, consideration of impoundment reform became 
increasingly joined with the idea of an item veto. In some 
respects, rescission action may be viewed as a functional 
equivalent to an item veto: the President identifies certain 
items in an appropriations law for possible deletion via an 
impoundment message to Congress. Legislative activity directed 
toward granting the President expanded rescission authority 
extended over several years. The efforts to modify the 
framework for congressional review of rescissions by the 
President, rather than to grant item veto authority directly, 
ultimately proved successful through an expanded rescission 
measure, the Line Item Veto Act of 1996 (P.L. 104-130).
    The Line Item Veto Act authorized the President to cancel 
discretionary budget authority, any new item of new direct 
spending, and certain limited tax benefits contained in a bill 
otherwise signed into law. Unless the Congress acted within a 
specified period to disapprove the President's rescissions, 
those rescissions would automatically take effect and the 
identified spending or targeted tax benefit would be cancelled. 
If the Congress disapproved the President's rescissions, the 
President could veto that disapproval, forcing the Congress to 
muster two thirds of both Houses to override that veto. Between 
January 1997 and June 1998, President Clinton sent 11 special 
messages to Congress, canceling a total of 82 provisions. 
Congress passed a bill disapproving 38 of those cancellations, 
which subsequently was vetoed by President Clinton. The 
President's veto was overridden, however, and the disapprovals 
were enacted into law.
    In June of 1998, by a 6 to 3 vote, the United States 
Supreme Court ruled in Clinton v. City of New York that the 
Line Item Veto Act violated the presentment clause of article 
I, section 7 of the Constitution. The clause requires that 
every bill which has passed the House and Senate before 
becoming law must be presented to the President for approval or 
veto, but is silent on whether the President may amend or 
repeal provisions of bills that have passed the House and 
Senate in identical form. The Court interpreted silence on this 
issue as equivalent to express prohibition. The Court rejected 
the argument that the President's power to cancel items was a 
mere exercise of discretionary authority granted by Congress. 
Instead, the cancellation authority represented the repeal of 
law that could be accomplished only through the regular 
legislative process, including bicameralism and presentment. In 
the two cancellations that reached the Court, Congress had not 
passed a resolution of disapproval. As a result, the Court 
concluded that ``the President has amended two Acts of Congress 
by repealinga portion of each.'' Clinton v. City of New 
York, cents 524 U.S. 417 (1998).
    On July 30, 1999, the House Rules Subcommittee on the 
Legislative and Budget Process held a hearing framed in the 
context of the Supreme Court decision to strike down the Line 
Item Veto Act, and refocused on providing certain parameters 
within which Congress may consider legislative changes to the 
current rescissions process. The Subcommittee heard testimony 
from Ms. Sylvia Mathews, Deputy Director, Office of Management 
and Budget, Mr. Dan Crippen, Director, Congressional Budget 
Office, and Mr. Gary Kepplinger, Associate General Counsel, 
General Accounting Office, as well as from a panel of academic 
experts consisting of Mr. Louis Fisher, Congressional Research 
Service, Library of Congress, Ms. Phillip Joyce, Professor of 
Public Administration, George Washington University, and Mr. 
Allen Schick, Visiting Fellow, Brookings Institution, with the 
goal of considering alternative means to achieve the twin goals 
of increased accountability and fiscal discipline within the 
spending process. Several approaches to modifying the 
rescission process were suggested, including: a constitutional 
amendment to allow the President to veto portions of bills 
presented to him for signature; separate enrollment of funding 
provisions as separate, smaller ``bills'' once a larger bill is 
passed by the Congress; enhanced rescission, which would allow 
the President to continue to withhold funds unless the Congress 
acted to overturn his rescission proposals; and expedited 
rescission, which would establish ``fast-track'' procedures to 
help ensure that the President's proposed cancellations 
received an up-or-down vote by the Congress within a specified 
period of time.
    It is useful to note that, in examining impoundment reform 
legislation, the distinction is often drawn between 
``expedited'' and ``enhanced'' rescission proposals. The 
expedited rescission approach focuses on procedural changes in 
Congress to require an up or down vote on certain rescission 
requests from the President. Those measures contain a detailed 
schedule to ensure prompt introduction of a measure to approve 
the rescission, fast report by committee, special limits on 
floor amendments and debate, and so on. Under expedited 
rescission, congressional approval would still be necessary to 
cancel the funding, but it would become difficult to ignore 
proposed rescissions and hence to reject them by inaction.
    Once the Supreme Court struck down the Line Item Veto Act, 
other legislative approaches, such as expedited rescission or 
separate enrollment, received renewed attention over the course 
of the 106th through the 108th Congresses. In each Congress 
since 1998, there have been multiple proposals to give the 
President authority for either an item veto or expanded 
impoundment authority; authority that could actually pass the 
question of constitutionality. Upon the convening of the 106th 
Congress in 1999, four measures were introduced proposing 
constitutional amendments giving the President line item veto 
authority along with four bills to provide alternative 
statutory means for conveying expanded impoundment authority to 
the President. In the 107th Congress, two measures proposing an 
item veto constitutional amendment were introduced. H.J. Res. 
23 sought to allow the President to disapprove any item of 
appropriation in any bill. H.J. Res. 24 sought to allow the 
President to decline to approve (i.e., to item veto) any in 
whole dollar amount of discretionary budget authority, any item 
of new direct spending, or any limited tax benefit. Omnibus 
budget reform bills, such as H.R. 5259, contained provisions 
for expedited rescission procedures. Early in the 108th 
Congress, H.R. 180, an omnibus budget reform measure was 
introduced containing provisions for expedited procedures for 
congressional action on proposals from the President to rescind 
budget authority identified as ``wasteful spending'' (section 
252). Later in 2003, two constitutional amendment proposals to 
authorize an item veto for the President were introduced (108th 
Congress, H.J. Res. 60 and S.J. Res. 25).
    On January 31, 2006, in his State of the Union address, 
President Bush expressed support of Congress's progress on 
earmark reform and reiterated his request for line-item veto 
authority, stating that ``the Federal budget has too many 
special interest projects,'' and that ``we can tackle this 
problem together, if you pass the line-item veto.'' On March 6, 
2006, President Bush sent a draft bill entitled the 
``Legislative Line Item Veto Act of 2006'' to Congress, and the 
measure was introduced the next day in both the House and 
Senate (H.R. 4890; S. 2381). H.R. 4890 marks the continuation 
of a monumental and long-standing effort to change the way 
Congress does business and restore public confidence in its 
ability to manage the Nation's finances.

                                Hearings

    On March 15, 2006, the House Rules Subcommittee on the 
Legislative and Budget Process held a hearing on H.R. 4890. 
Testimony was received from the Honorable Paul Ryan of 
Wisconsin, the sponsor of the bill, and from the Honorable 
Jerry Lewis, Chairman of the Appropriations Committee. Mr. Joel 
Kaplan, the then Deputy Director of the Office of Management 
and Budget (OMB), and Mr. Donald B. Marron, the Acting Director 
of the Congressional Budget Office (CBO) also appeared before 
the Subcommittee.

                        Committee Consideration

    The Committee on Rules met on June 15, 2006 in open session 
and ordered H.R. 4890 favorably reported to the House as 
amended by a record vote of 8 to 4.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. A 
record vote was ordered on the following motion; the names of 
Members voting for and against follow:

Rules Committee record vote No. 225

    A motion offered by Mr. Lincoln Diaz-Balart, to favorably 
report H.R. 4890, the Legislative Line Item Veto Act of 2006, 
with an amendment in the nature of a substitute placed at the 
desk consisting of the text of the bill as reported by the 
Committee on the Budget on June 14, 2006, was agreed to by a 
record vote of 8 yeas and 4 nays:
    Mr. Dreier, Chairman--Yea; Mr. Lincoln Diaz-Balart--Yea; 
Mr. Hastings (WA)--Yea; Mr. Putnam--Yea; Ms. Capito--Yea; Mr. 
Cole--Yea; Mr. Bishop--Yea; Mr. Gingrey--Yea; Mrs. Slaughter--
Nay; Mr. McGovern--Nay; Mr. Hastings (FL)--Nay; Mrs. Matsui--
Nay.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee made findings that are 
reflected in this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee establishes the 
following performance related goals and objectives for this 
legislation:
    Utilizing the authority granted in this legislation, the 
President of the United States will initiate rescissions 
proposals to be acted on by Congress in order to help restrain 
the Federal Deficit and eliminate wasteful spending of the 
taxpayer dollar.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    Pursuant to clause 3(c)(2) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that this 
legislation would result in no new budget authority, 
entitlement authority, or tax expenditures or revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 19, 2006.
Hon. David Dreier,
Chairman, Committee on Rules,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 4890, the 
Legislative Line Item Veto Act of 2006.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Jeffrey 
Holland.
            Sincerely,
                                          Donald B. Marron,
                                                   Acting Director.
    Enclosure.

H.R. 4890--Legislative Line Item Veto Act of 2006

    H.R. 4890 would establish a new expedited procedure for 
considering Presidential proposals to cancel certain spending 
and tax provisions in newly enacted legislation. CBO estimates 
that enacting H.R. 4890, by itself, would not have any 
significant impact on the budget. Any impact on the budget 
would depend on the extent of the President's use of the new 
cancellation procedure and on future Congressional actions.
    The bill would establish a procedure for the President to 
propose cancelling specified discretionary budget authority, 
items of direct spending, or targeted tax benefits (defined as 
any provisions of a revenue bill that provide a federal tax 
benefit to only one beneficiary) and for Congressional 
consideration of such proposals. The President would transmit a 
special message to both Houses of Congress specifying the 
project or governmental functions involved, the reasons for the 
proposed cancellations, and--to the extent practicable--the 
estimated fiscal, economic, and budgetary effect of the action. 
The Congress could then approve or disapprove the President's 
proposals in legislation. (If approved, any such proposed 
cancellations would then become law.)
    Under H.R. 4890, the President could submit up to five 
special messages for most acts and joint resolutions, and up to 
10 special messages for reconciliation or omnibus appropriation 
acts. A message would have to be transmitted to the Congress 
within 45 calendar days of enactment of the legislation 
containing the items proposed for cancellation. Within five 
days of receiving a special message, the majority leaders of 
the House and Senate (or their designees) would be required to 
introduce a bill or joint resolution to approve the proposed 
cancellations; that approval bill would be considered under 
expedited procedures. H.R. 4890 also would amend the 
Congressional Budget Act to require that CBO prepare an 
estimate of sayings in budget authority and outlays resulting 
from any cancellations proposed by the President.
    Additionally, the President could withhold discretionary 
budget authority proposed for cancellation and suspend items of 
direct spending and targeted tax benefits for 45 days from the 
date on which a special message is transmitted. For each such 
transmittal, the Government Accountability Office would be 
required to submit a report to the Congress indicating whether 
any delay in obligation of discretionary authority, suspension 
of a direct spending item, or suspension of a targeted tax 
benefit continued after the President's authority to suspend 
them expired.
    The impact of H.R. 4890 on future legislation would depend 
on both the nature of such legislation and on the actions of 
the President and the Congress in implementing the expedited 
cancellation procedure in H.R. 4890. Therefore, this bill would 
not--by itself--have any significant impact on the federal 
budget. CBO estimates that any additional administrative costs 
for implementing H.R. 4890 would not be significant because 
both the executive branch and the Congress already carry out 
activities similar to those that would be involved in preparing 
and responding to Presidential budget proposals (including, for 
example, proposed rescissions of discretionary appropriations).
    H.R. 4890 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and--by 
itself--would have no impact on the budgets of state, local, or 
tribal governments. Any budgetary impacts would depend on 
subsequent legislative action.
    On June 16, 2006, CBO transmitted a cost estimate for H.R. 
4890 as ordered reported by the House Committee on the Budget 
on June 14, 2006. The two versions of the bill are identical, 
as are the two estimates.
    The CBO staff contact for this estimate is Jeffrey Holland. 
This estimate was approved by Peter H. Fontaine, Deputy 
Assistant Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority of Congress to enact this legislation 
is provided by Article 1, Section 5, Clause 2 of the 
Constitution of the United States (relating to each House of 
Congress determining the rules of its proceedings).

                Applicability to the Legislative Branch

    The Committee finds that the legislation does not address 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act as they 
relate to the Legislative Branch, so a statement as to their 
applicability is not required.

             Section-by-Section Analysis of the Legislation


Section 1. Short title; table of contents

    This section provides the short title of the bill, the 
Legislative Line Item Veto Act of 2006.

Section 2. Legislative line item veto

    Subsection (a) amends title X of the Congressional Budget 
and Impoundment Control Act of 1974 by striking all of part B 
(except sections 1016 and 1013, which are designated as 
sections 1019 and 1020, respectively). It then inserts the 
following new sections:
    New section 1011 provides that, after the enactment of any 
bill or joint resolution providing discretionary budget 
authority, or enacting an item of direct spending or a targeted 
tax benefit, the President may send a special message to 
Congress to cancel any specific provision in one or more of the 
following budgetary classes: discretionary budget authority; 
direct spending; or targeted tax benefits. The President must 
send to Congress this message within 45 calendar days of the 
enactment of the new law.
    If the last day of that 45-day period falls on a day in 
which the Congress has been adjourned for an extended period 
(45 days or more) or if it falls on a day after which the 
Congress has adjourned sine die at the end of the second 
session of that Congress, then the President's authority to 
transmit a special message is extended to the first day the 
Congress reconvenes. The President may transmit the special 
message after the 45-day period has expired only in those 
specific circumstances.
    The contents of the special message must specify the amount 
of budget authority, the specific item of direct spending, or 
the targeted tax benefit that the President proposes be 
cancelled; any account, department, or establishment of the 
Government to which such budget authority or item of direct 
spending is available for obligation; and the specific project 
or governmental functions involved. It rescinds the 
discretionary budget authority or suspends the direct spending 
or tax procedures. It must, to the maximum extent practicable, 
explain the estimated fiscal, economic, and budgetary effects 
of the proposed cancellations.
    The special message must include a numbered list of 
proposed cancellations-this would take the form of rescissions 
of amounts of discretionary budget authority and legislative 
language canceling the effects of items of direct spending and 
targeted tax benefits (and making appropriate conforming 
changes in law). Cancellations of targeted tax benefits must be 
drawn from a list of such provisions included in a tax measure, 
if such a list is provided. Any provision included in a special 
message that is not on that list will not be included in an 
approval bill for consideration by Congress.
    The President is allowed to transmit to the Congress up to 
five special messages for any enacted law. All must be 
transmitted within the 45-day period of the signing of the 
bill, unless one of the exceptions already noted applies.
    The President is not allowed to propose to cancel a 
specific budgetary provision more than one time. Although he is 
allowed five special messages for each enacted law, he may not 
repeatedly send to Congress the same proposed cancellation. Any 
savings resulting from cancellations enacted as part of an 
approval bill will go towards reducing the deficit.
    Any amounts of discretionary budget authority, items of 
direct spending, or targeted tax benefits cancelled when an 
approval bill is signed into law are dedicated to deficit 
reduction. After the enactment of an approval bill, the 
Chairmen of the Committees on the Budget of the Senate and the 
House of Representatives must revise the levels of the 
concurrent resolution on the budget in force at the time to 
ensure that the savings achieved are not used to finance other 
spending, whether discretionary or mandatory (or, in cases of 
increased revenues, are not used to reduce other taxes).
    Correspondingly, when an approval bill is enacted, the 
Office of Management and Budget must revise the discretionary 
caps and the PAYGO scorecard to reflect the spending and 
revenue changes, if those spending controls are reauthorized so 
as to be in force when an approval bill is enacted. PAYGO and 
the discretionary caps expired at the end of fiscal year 2002.
    New section 1012 provides for expedited consideration of 
the messages. Section 1012(a)(1) requires that, after Congress 
has received a special message from the President proposing 
cancellations, the majority leader of the House and the Senate 
respectively (or their designees) shall introduce a bill to 
approve those cancellations within five days of session of each 
applicable House.
    Paragraph (2) provides the procedures for expedited 
consideration in the House. This subsection requires a 
committee of the House of Representatives, to which an approval 
bill is referred, to report the bill without amendment within 
seven legislative days of consideration. If a committee does 
not report the bill within seven legislative days, any member 
may make a privileged motion to discharge the relevant 
committee or committees from consideration of the bill.
    The Member making the privileged motion to discharge must 
give notice to the House of his or her intent to do so, after 
which the Speaker must schedule a time to consider the motion 
within the next two legislative days. The privileged motion to 
discharge is debatable for 20 minutes after which the previous 
question is considered as ordered on the motion and a motion to 
reconsider the vote on which the motion is disposed of is not 
allowed. If the motion is agreed to, the House then moves to 
immediate consideration of the approval bill under the 
expedited procedures set out in this subsection. If the 
approval bill has been reported or a motion to discharge has 
already been disposed of, the privileged motion to discharge 
provided in this subsection is not in order.
    If an approval bill is reported from committee, or it has 
been discharged through regular House procedure, then it is in 
order for any Member to make a privileged motion to proceed to 
consideration of the bill. This is a highly privileged motion 
and provides for the immediate consideration of the bill once 
agreed to. The Member making the privileged motion to proceed 
to consideration must give notice to the House of his or her 
intent to do so, after which the Speaker must schedule atime to 
consider the motion within the next two legislative days. If the motion 
to proceed to consideration is agreed to, the approval bill must be 
immediately considered on the floor.
    If the House adopts a concurrent resolution providing for 
adjournment sine die at the end of a Congress and an approval 
bill, introduced by the Majority Leader or his designee, has 
either not been reported by a committee or disposed of by the 
House, then it shall be in order for any Member to immediately 
give notice of their intention to offer either a privileged 
motion to discharge that approval bill from committee or a 
privileged motion to proceed to consideration of that approval 
bill as provided for in this subsection. When the House adopts 
a concurrent resolution to adjourn sine die, that Congress does 
not immediately end: additional action must be taken before the 
Congress comes to a finish. If an approval bill has been 
introduced, but has not been considered by the House at the 
time the House adopts a concurrent resolution of adjournment, 
the specified procedures of this act are triggered. In this 
circumstance, it does not matter at what stage the approval 
bill is, as long as it has been introduced. Were a committee to 
only have just been referred the approval bill, a motion to 
discharge the bill and bring it to the House floor still would 
be in order.
    The ``specific procedures'' contained in this subsection 
for consideration of an approval bill are as follows:
           Provides five hours of debate on the bill 
        equally divided and controlled by the proponent and an 
        opponent;
           Provides for one motion to limit debate on 
        the bill;
           Provides that the bill be considered as 
        read;
           Provides that all points of order against 
        consideration of the bill are waived; and
           Provides that the previous question is 
        considered as ordered on the bill.
    The ``specific procedures'' contained in this subsection 
for consideration of an approval bill do not allow for a motion 
to recommit the bill and do not allow for a motion to 
reconsider the vote on passage of the bill.
    Last, an approval bill received from the Senate is not 
referred to committee and may be brought up for consideration 
as an alternative to the House introduced bill.
    Paragraph (3) provides for the expedited procedures for the 
Senate. The Committee has not amended this section, as this is 
a matter for Senate consideration of the bill.
    As introduced, the bill provides for a motion to proceed to 
the consideration of a bill under this subsection in the Senate 
which is not debatable. It is not in order to move to 
reconsider the vote. Debate in the Senate on a bill under this 
subsection, and all debatable motions and appeals, may not 
exceed 10 hours, equally divided. Debate in the Senate on any 
debatable motion or appeal in connection with a bill under this 
subsection shall be limited to not more than 1 hour, to be 
equally divided and controlled in the usual form. A motion in 
the Senate to further limit debate on a bill under this 
subsection is not debatable. A motion to recommit a bill is not 
in order. If the Senate receives the House companion bill to 
the bill introduced in the Senate before the required vote, 
then the Senate may consider and vote on the House companion 
bill.
    If the Senate votes on the bill introduced in the Senate, 
then immediately following that vote, or upon receipt of the 
House companion bill, the House bill shall be deemed to be 
considered, read the third time, and the vote on passage of the 
Senate bill shall be considered to be the vote on the bill 
received from the House.
    Subsection (b) applies to both the Senate and the House of 
Representatives and makes clear that no amendment or motion to 
strike a provision from an approval bill is allowed to be 
considered at any stage of consideration. By not allowing 
amendments or motions to strike, the subsection ensures that 
identical approval bills will be considered by both Houses, 
further expediting the consideration of an approval measure and 
ensuring a clean ``up or down'' vote on the President's 
proposal.
    New section 1013 provides for Presidential deferral 
authority. Subsection (a) affords the President the authority 
to choose not to obligate discretionary budget authority and 
not to implement items of direct spending or targeted tax 
benefits (under certain limitations) for 45 calendar days 
beginning on the day a special message is received by either 
the House or the Senate.
    The time for this deferral period runs consecutively, so 
that from the time the transmittal is received in either the 
House or the Senate, the period begins. It ceases after the 
45th day after the day of transmittal. This period, however, 
may be renewed by the President at his discretion with two 
limitations: He may only extend the time period if he sends a 
special supplemental message to Congress notifying both Houses 
of the need to do so; and he must send that message after the 
40th day of the first 45-day period.
    A supplemental special message is simply that--a supplement 
to the initial special message transmitted pursuant to the 
authority to defer budgetary provisions, explained in section 
1011. The message must notify Congress that the President 
intends to extend his deferral authority, which is authorized 
under section 1013 of the act, by an additional 45 days.
    As part of this supplemental special message, the President 
must specifically explain why special circumstances have arisen 
so that the original 45-day period is insufficient to 
accommodate the proposed cancellations and their consideration 
by the Congress. This extension may apply, for example, if 
Congress is in an extended recess and has been unable to 
consider a bill to approve the cancellations proposed by the 
President within the initial 45-day deferral period. Such a 
circumstance must be explained in detail in the supplemental 
special message.
    Under no circumstances is this additional deferral 
authority to be used by the President subsequent to the defeat 
of an approval bill in either House of Congress. Once Congress 
acts on an approval bill, this deferral authority must be 
discontinued by the President, even though it is not legally or 
constitutionally required, and he must not extend it for the 
renewal period. The President cannot transmit a supplemental 
special message to Congress subsequent to a negative vote on an 
approval bill by either House.
    Up to five special messages proposing cancellations of 
budgetary provisions may be transmitted for each public law 
enacted after this act, but only one supplemental special 
message may be transmitted for each of those special messages 
for that law. A supplemental special message is an additional 
component of the original special message transmitted under the 
authority of this act. A supplemental special message does not 
count toward the five special messages allowed for each public 
law--it is not a special message in and of itself. It is merely 
an adjunct of a previously transmitted special message. Its 
form is not set out specifically through legislative language, 
but its requirements and parameters are made clear in this 
report.
    In addition, the President may submit a valid supplemental 
special message only after 40 calendar days have expired during 
the initial 45-day deferral period. This is to ensure Congress 
has enough time to consider the proposed cancellations before 
the President asks for more deferral authority. Though it is 
not legally or technically circumscribed, the authority to 
renew deferrals would occur during exceptional circumstances 
when the Congress has been unable to consider the approval bill 
that includes the proposed cancellations.
    After the expiration of the 45-day period and absent a 
renewal, or after the expiration of the renewal 45-day period, 
the budgetary provisions proposed to be cancelled and which 
have been deferred, must be implemented or obligated, as the 
case may be, as is required by theConstitution and the 
Congressional Budget and Impoundment Control Act of 1974.
    As the special supplemental message may not be transmitted 
to Congress prior to 40 calendar days after the initial 
transmittal, once the 45-day period has expired, no special 
supplemental message may be transmitted; the authority to renew 
the deferral period has also expired. By way of example, should 
the initial 45-day period expire, and no renewal special 
supplemental notice be transmitted during that period, 
immediately thereafter the budget authority appropriated must 
be made available for obligation as if the deferral had never 
occurred.
    Additionally, once the 45-day period has elapsed without a 
supplemental special message having been sent, the option of 
sending such a supplemental message is not available. Deferral 
authority under this act has entirely expired once the initial 
45-day period has ended and no supplemental special message has 
been transmitted.
    The legislative calendar of the Congress is not relevant 
for the calculation of this deferral period, with the singular 
exception of last day on which the transmittal of the original 
special message may occur. If the Congress has adjourned to a 
future date when the initial deferral period expires, the 
supplemental special message is unaffected.
    Even in the unusual circumstance when a supplemental 
special message is transmitted after the second session of a 
Congress has adjourned but before the first session of the next 
Congress has convened, the Congress still represents the people 
of the United States, and the Senate is a continuing body, so 
that the communication of such a transmittal is always valid to 
extend the deferral authority.
    Although the authority to defer spending and certain tax 
benefits under the initial 45 days (and any applicable renewal 
period) is independent of legislative actions taken by 
Congress, it is the intent of the Committee that if a vote is 
taken on an approval bill by either House, and one approval 
bill is not agreed to by that House, then the suspension of any 
provision of law must be revoked and that provision put into 
effect as if it had always been effective under the terms of 
the public law in which it was originally included.
    Out of constitutional concerns, the Committee has not 
directly tied the suspension or deferral period to a failed 
vote or on approval. It does, though, indicate its intent that 
such a vote should have that effect. The President must 
immediately suspend the deferral of all budgetary provisions 
included in an approval bill of proposed cancellations that, 
after floor consideration of the bill, has not received the 
requisite votes to pass in a House of Congress.
    New section 1014 provides for the identification of 
targeted tax benefits. Subsection (a) requires the Chairman of 
the House Committee on Ways and Means and the Chairman of the 
Senate Finance Committee to review a bill or joint resolution 
that amends the Internal Revenue Code of 1986 and that a 
conference committee is preparing for filing, to determine if 
it contains any targeted tax benefits. The two chairmen must 
then provide to the conference committee a statement 
identifying the targeted tax benefits or declaring that the 
bill or joint resolution does not contain any.
    Subsection (b) authorizes a conference committee to include 
a statement described in subsection (a) as legislative text in 
the conference agreement to which the statement applies.
    Subsection (c) delineates the President's authority to 
propose the cancellation of targeted tax benefits. If any bill 
or joint resolution is signed into law, then the President may 
propose to cancel only targeted tax benefits identified in the 
specific section of the law containing the statement described 
in subsection (a). If such a statement is not included in the 
law, then the President may apply the statutory definition of 
targeted tax benefit to determine which tax provisions he may 
propose to cancel.
    New section 1015 addresses the treatment of cancellations. 
This section makes clear that a cancellation proposed by the 
President must be approved by Congress and signed into law 
before the elimination of the spending or tax provision is 
effective.
    If the approval bill is not agreed to by Congress or is 
vetoed by the President, and hence the cancellations are not 
approved, those spending or tax provisions proposed to be 
cancelled remain in force and must be put into effect as if the 
deferral and the proposed cancellation had never been made.
    If the approval bill is agreed to by Congress and signed 
into law by the President, and hence the cancellations are 
approved, then the effect is to cause the deficit to be reduced 
(or the surplus increased) by the amount of the spending or tax 
provision cancelled.
    New section 1016 requests that the Comptroller General of 
the Government Accountability Office prepare and transmit to 
Congress a report for each special message sent by the 
President to the Congress. This report must identify the date 
on which the special message was transmitted to the Congress, 
the public law to which the special message applies, and the 
number of special messages transmitted relative to that public 
law at the time of the preparation of the report.
    It must also, if specifically requested by the Chairman of 
the House or Senate Budget Committee, describe the extent to 
which a proposed cancellation in the message is similar to or 
different from anotherproposed cancellation in another special 
message arising from the same public law.
    The report must assess whether any provision deferred by 
the President remains deferred after the authorized period 
provided to the President has expired. This report is intended 
to be prepared as soon as practicable after the expiration of 
the deferral period defined in the act, which is 45 days 
without an extension, or 90 days if the President determines 
that an extension is necessary.
    If an additional 45-day renewal period occurs because of 
the President's actions, then the report should note any 
reasons or justifications as to why the extension period is 
needed.
    New section 1017 provides definitions for the bill.
    The term ``appropriation law'' means an Act referred to in 
section 105 of title 1, United States Code, including any 
general or special appropriation Act, or any Act making 
supplemental, deficiency, or continuing appropriations that has 
been signed into law pursuant to Article I, Section 7, of the 
Constitution of the United States.
    The term ``approval bill'' means a bill or joint resolution 
which only approves proposed cancellations of dollar amounts of 
discretionary budget authority, items of new direct spending, 
or targeted tax benefits in a special message transmitted by 
the President.
    The title of the approval bill is as required to be as 
follows: ``A bill approving the proposed cancellations 
transmitted by the President on __.'' Except for the 
limitations included in this definition, a bill with this title 
is entitled to the privileged status and expedited 
consideration procedures set out in this bill.
    The blank space is filled in by the sponsor of the bill or 
the majority leader of each House of Congress (or designee), 
with the date of transmission of the special message and the 
public law number to which the message relates. It does not 
have a preamble. The bill outlined in the text includes a 
numbered list from the President's special message. In 
preparing the approval bill, the sponsor may include only 
proposed cancellations of spending estimated by CBO to meet the 
definition of discretionary budgetary authority or items of 
direct spending, and may include only proposed cancellations of 
tax provisions determined by the chairmen of the House Ways and 
Means and Senate Finance Committees to be targeted tax 
benefits. If an approval bill includes a tax provision that has 
not been chosen from the prepared list, the bill's privileged 
status is jeopardized, and the majority leader will have failed 
to fulfill his or her responsibilities under this bill.
    It is the intent of the Committee that a bill, even if it 
has the appropriate title, should not be conferred the 
privileged status of an approval bill if it includes items of 
direct spending that do not meet the criteria set out. If a 
bill deemed an approval bill includes a provision from the 
special message that is not estimated by CBO to meet the 
appropriate criteria, or an item not in the special message is 
included, or the bill in some other fashion does not meet this 
definition of an ``approval bill,'' then the measure should not 
be accorded the privileged status that is set out for such a 
bill. Any bill receiving the expedited procedures provided for 
in the Legislative Line Item Veto Act of 2006 must strictly 
adhere to this definition and follow its parameters.
    Proposed cancellations that CBO estimates do not meet the 
definition of an item of direct spending are included in a 
separate section of the approval bill, but this section 
specifies that the President must implement those provisions. 
The President must cease any deferral of those provisions, and 
must implement them using the effective date of the original 
public law in which they were included.
    Though an approval bill is intended to allow for only those 
provisions that have been estimated as having a budgetary 
effect as estimated by CBO, the Committee understands that 
there may be a circumstance whereby a CBO estimate is not 
available prior to the introduction of the bill. In such a 
situation, the entire list of legislative provisions proposed 
by the President is inserted in the approval bill. This is only 
a contingency to assure the consideration of legislation is not 
hindered due to unforeseen circumstances. It is expected that 
CBO will be able to estimate the effects of any proposed 
cancellations included in an approval bill to allow the sponsor 
of such a measure to appropriately draft the language.
    The term ``calendar day'' means a standard 24-hour period 
beginning at midnight.
    The terms ``cancel'' or ``cancellation'' mean to prevent 
discretionary budget authority from being obligated, or a 
provision of direct spending or targeted tax benefit from being 
implemented. These proposed cancellations are included in an 
approval bill introduced by the majority leaders of the House 
and Senate. The majority leaders of the respective Houses are 
required to introduce the approval bills, much as they must 
introduce other expedited measures such as trade agreements 
considered pursuant to Trade Promotion Authority and measures 
considered pursuant to the Base Realignment And Closure (BRAC) 
procedures.
    A cancellation takes the form of legislative or 
appropriations text reflecting a rescission of a specific 
amount of discretionary budget authority, or a cancellation of 
the legal effects of a direct spending provision (within very 
limited confines) or a targeted tax benefit.
    For a rescission of discretionary budget authority, a 
cancellation is simple--the language included in the special 
message merely needs to ``rescind'' a specific amount 
reflecting the entire amount of an appropriation, or a smaller 
amount of budget authority within an overall amount if there is 
an earmark set out in the joint statement or report on the 
appropriations bill in question. If there are no earmarks, then 
only the entire amount of the appropriation may be rescinded, 
not simply an arbitrary amount of the overall level. In terms 
of an item of direct spending, the legislative change proposed 
by the President--that is, the proposed ``cancellation''--must 
be narrow in scope. It must only be a ``necessary, conforming 
statutory change'' and only one that is to ``ensure that * * * 
budgetary resources are appropriately cancelled.'' The 
Legislative Line Item Veto Act of 2006 is not intended to allow 
the President to force Congress to consider policy proposals or 
interests of the President. Hence, any legislative text given 
preferential treatment under this measure must be narrowly 
tailored to have a salutary budgetary effect. It is not an 
open-ended invitation for a vote on the floor of the House and 
Senate for any legislation the President may desire to propose.
    The Committee expects that the special procedure set out in 
the Legislative Line Item Veto Act of 2006 will be followed by 
conferees on any tax bill. That procedure requires the managers 
of any bill making changes to the Internal Revenue Code of 1986 
to include a list of items that meet the definition of a 
``targeted tax benefit'' in the bill. This list is prepared by 
the Chairmen of the Committees on Finance and Ways and Means 
and put into legislative language and included in the 
applicable measure. Upon enactment, the President may only 
choose items from that list to include in his special message 
with respect to proposed targeted tax benefit cancellations 
that he transmits to Congress for the purposes of this act. The 
President may only draft a list of his own choosing if the 
Chairmen of the Committees on Finance and Ways and Means do not 
include such a list in the tax bill.
    If the two chairmen determine there are no targeted tax 
benefits in the bill they are preparing, then a statement may 
be included in the bill that no such targeted tax benefits 
exist and therefore the President is not permitted to transmit 
the proposed cancellation of any tax provisions in that bill 
which has become public law.
    The term ``CBO'' means the Director of the Congressional 
Budget Office.
    The term ``direct spending'' is defined as budget authority 
provided by law other than an appropriation law; an 
entitlement; and the food stamp program.
    The term ``dollar amount of discretionary budget 
authority'' is defined as the entire dollar amount of budget 
authority or obligation limitation: specified in an 
appropriation law; required to be allocated by a specific 
proviso in an appropriation law for which a specific dollar 
figure was not included; represented separately in any table, 
chart, or explanatory text included in the statement of 
managers or the governing committee report accompanying such 
law; required to be allocated for a specific program, project, 
or activity in a law (other than an appropriation law) that 
mandates the expenditure of budget authority from accounts, 
programs, projects, or activities for which budget authority is 
provided in an appropriation law; represented by the product of 
the estimated procurement cost and the total quantity of items 
specified in an appropriation law or included in the statement 
of managers or the governing committee report accompanying such 
law; or represented by the product of the estimated procurement 
cost and the total quantity of items required to be provided in 
a law (other than an appropriation law) that mandates the 
expenditure of budget authority from accounts, programs, 
projects, or activities for which budget authority is provided 
in an appropriation law.
    The term does not include direct spending; budget authority 
in an appropriation law which funds direct spending provided 
for in another law; any existing budget authority canceled in 
an appropriation law; or any restriction, condition, or 
limitation in an appropriation law or the accompanying 
statement of managers or committee reports on the expenditure 
of budget authority for an account, program, project, or 
activity, or on activities involving such expenditure.
    An ``item of direct spending'' is defined as any provision 
of law that CBO estimates increases budget authority or outlays 
for direct spending relative to the baseline projections of 
direct spending made after receipt of the President's budget 
submission. An item falls under this definition if it increases 
direct spending in the first year of the 5-year period for 
which the item is effective. An exception is provided for the 
extension or reauthorization of existing direct spending. This 
exception refers to specific items of direct spending rather 
than the level of direct spending assumed in the baseline. 
Accordingly, a reauthorization bill could have no cost in the 
aggregate relative to the baseline, but still contain new items 
of direct spending that could be proposed to be canceled for 
purposes of the legislative line item veto.
    The term ``OMB'' is defined as the Director of the Office 
of Management and Budget.
    For purposes of this legislation, an ``Omnibus 
Reconciliation'' bill is one reported by the Budget Committee 
pursuant to a directive in a concurrent budget resolution. It 
is a multi-jurisdictional bill with avariety of authorizing 
committees being directed through the reconciliation process to make 
changes to laws in their jurisdiction. Though traditionally 
reconciliation bills have been used to reduce spending, they have also 
included new direct spending items and may include targeted tax breaks 
as well.
    The intent of the act is to target narrowly based direct 
spending provisions that are tantamount to discretionary 
earmarks, and might not survive narrow legislative scrutiny. 
Although this is the case, the text of the act does not prevent 
broader new entitlement programs from being proposed for 
cancellation by the President.
    An ``Omnibus Appropriations'' bill is defined as any 
measure providing appropriations falling within the 
jurisdiction of two or more subcommittees of the Committee on 
Appropriations of either House of Congress. In general, 
appropriations bills are considered separately as individual 
bills, each with a specified amount of budget authority for the 
programs the measure funds. Upon occasion, and due to a variety 
of reasons, two or more appropriations bills may be combined, 
usually at the end of the legislative season, and enacted as an 
``omnibus'' appropriation. Because these can often be enormous 
bills, with labyrinthine appropriations and legislative text, 
they also merit a larger number of special messages--10 instead 
of merely five.
    It must be mentioned that ``supplemental'' appropriations 
bills are often considered and have multi-jurisdictional 
spending components. These would also, generally, include 
spending that falls within the jurisdiction of two or more 
suballocations made to the committees of the House or the 
Senate. Though these bills are generally of a smaller spending 
magnitude than those normally considered as being Omnibus 
bills, they are often of similar complexity and breadth of 
spending provisions. Accordingly, supplementals also merit 10 
special messages instead of 5. Furthermore, they often include 
``emergency'' designations which in some circumstances allow 
the spending to escape normal budgetary controls. The 
Legislative Line Item Veto Act of 2006, however, is an 
extraordinary budgetary control, and instead of creating 
procedural hurdles to votes on spending bills, it insists on 
votes on specific spending items.
    In this respect, this bill does not recognize ``emergency'' 
spending as opposed to ``non-emergency spending,'' but merely 
allows certain spending, or targeted tax benefits, to be 
reconsidered.
    A ``targeted tax benefit'' is defined as any revenue-losing 
provision amending the Internal Revenue Code of 1986 and 
benefiting a single taxpayer in any fiscal year for which the 
provision is in effect. A revenue-losing provision is any 
provision that reduces Federal tax revenues either in the first 
fiscal year for which the provision is effective or the period 
of the 5 fiscal years beginning with the first fiscal year for 
which the provision is effective. The definition of 'revenue-
losing' includes both provisions that reduce revenue relative 
to current law, as well as provisions that reduce revenue 
relative a broader provision in the bill in which the provision 
is found. The Committee believes that rifle shot transitional 
rules that benefit a single taxpayer should constitute targeted 
tax benefits. Such special rules have the effect of retaining 
current law for a particular taxpayer, despite the fact that a 
broader class of taxpayers is affected adversely by the bill. 
Thus, they are appropriate candidates for inclusion in approval 
bills even if they do not reduce revenue relative to current 
law.
    For example, a provision in the Tax Reform Act of 1986 
included a favorable rule for banks, and also included a 
special exception treating certain non-banks as banks for 
purposes of the rule. The special exception applied to any 
corporation ``if (A) such corporation is a Delaware corporation 
incorporated on August 20, 1959, and (B) such corporation was 
primarily engaged in the financing of dealer inventory or 
consumer purchases on May 29, 1985, and at all times thereafter 
before the close of the taxable year.'' P.L. 99-514, 100 Stat. 
2548, sec. 1215(c)(5). If the Chairmen of the Ways and Means 
Committee and the Senate Finance Committee expected only a 
single taxpayer to benefit from this special exception, it 
would constitute a targeted tax benefit.
    For purposes of applying the single-beneficiary test, 
several aggregation rules treat certain groups of taxpayers as 
a single taxpayer. All businesses in the same affiliated group, 
all shareholders of the same corporation, all partners of the 
same partnership, all members of the same association, all 
beneficiaries of the same trust or estate, all employees of the 
same employer, all beneficiaries of the same qualified plan, 
all contributors to the same foundation or charity, and all 
holders of the same bond issue are treated as one beneficiary. 
In addition, if a corporation, partnership, association, trust, 
or estate is the beneficiary of a tax provision, then the 
shareholders of the corporation, the partners of the 
partnership, the members of the association, or the 
beneficiaries of the trust or estate are not also treated as 
beneficiaries of the provision. Thus, for example, a provision 
excluding from gross income all income of a particular 
corporation and all income of any shareholders in that 
corporation would be treated as having a single beneficiary.
    New section 1018 provides for an expiration date so that 
the Act has no force or effect on or after October 1, 2012. 
Effectively, this provides for a sunset of the Legislative Line 
Item Veto Act after six years, so after that time, it must be 
reconsidered and extended.

Section 3. Technical and conforming amendments

    This section makes various technical and conforming changes 
to various statutes amended by this legislation.
    Subsection (d) contains a savings clause which provides 
that the Legislative Line Item Veto Act only applies to laws 
enacted on or after this law is signed.

Section 4. Sense of Congress on abuse of proposed cancellations

    This section expresses the Sense of Congress that the 
President should not abuse the authority provided under the 
Legislative Line Item Veto Act of 2006.

    Changes in the Rules of the House Made by the Bill, as Reported

    Clause 3(g) of rule XIII of the Rules of the House of 
Representatives requires that whenever the Committee on Rules 
reports a resolution amending or repealing the Rules of the 
House of Representatives, the accompanying report must contain 
a comparative print showing the changes in existing rules 
proposed to be made by the resolution.
    This bill makes no changes to any standing rules of the 
House of Representatives.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

        CONGRESSIONAL BUDGET AND IMPOUNDMENT CONTROL ACT OF 1974


                    SHORT TITLES; TABLE OF CONTENTS

  Section 1. (a) Short Titles.--This Act may be cited as the 
``Congressional Budget and Impoundment Control Act of 1974''. 
Titles I through IX may be cited as the ``Congressional Budget 
Act of 1974''. Parts A and B of title X may be cited as the 
``Impoundment Control Act of 1974''. [Part C of title X may be 
cited as the ``Line Item Veto Act of 1996''.]
  (b) Table of Contents.--
Sec. 1. Short titles; table of contents.
     * * * * * * *

                      TITLE X--IMPOUNDMENT CONTROL

     * * * * * * *

     [Part B--Congressional Consideration of Proposed Rescissions, 
             Reservations, and Deferrals of Budget Authority

[Sec. 1011. Definitions.
[Sec. 1012. Rescission of budget authority.
[Sec. 1013. Proposed deferrals of budget authority.
[Sec. 1014. Transmission of messages; publication.
[Sec. 1015. Reports by Comptroller General.
[Sec. 1016. Suits by Comptroller General.
[Sec. 1017. Procedure in House and Senate.

                         [Part C--Line Item Veto

[Sec. 1021. Line item veto authority.
[Sec. 1022. Special messages.
[Sec. 1023. Cancellation effective unless disapproved.
[Sec. 1024. Deficit reduction.
[Sec. 1025. Expedited congressional consideration of disapproval bills.
[Sec. 1026. Definitions.
[Sec. 1027. Identification of limited tax benefits.]

                   Part B--Legislative Line Item Veto

Sec. 1011. Line item veto authority.
Sec. 1012. Procedures for expedited consideration.
Sec. 1013. Presidential deferral authority.
Sec. 1014. Identification of targeted tax benefits.
Sec. 1015. Treatment of cancellations.
Sec. 1016. Reports by Comptroller General.
Sec. 1017. Definitions.
Sec. 1018. Expiration.
Sec. 1019. Suits by Comptroller General.
Sec. 1020. Proposed deferrals of budget authority.

           *       *       *       *       *       *       *


      TITLE IV--ADDITIONAL PROVISIONS TO IMPROVE FISCAL PROCEDURES

Part A--General Provisions

           *       *       *       *       *       *       *


                ANALYSIS BY CONGRESSIONAL BUDGET OFFICE

  Sec. 402. (a) The Director of the Congressional Budget Office 
shall, to the extent practicable, prepare for each bill or 
resolution of a public character reported by any committee of 
the House of Representatives or the Senate (except the 
Committee on Appropriations of each House), and submit to such 
committee--
          (1) * * *

           *       *       *       *       *       *       *

  (b) Upon the receipt of a special message under section 1011 
proposing to cancel any item of direct spending, the Director 
of the Congressional Budget Office shall prepare an estimate of 
the savings in budget authority or outlays resulting from such 
proposed cancellation relative to the most recent levels 
calculated consistent with the methodology used to calculate a 
baseline under section 257 of the Balanced Budget and Emergency 
Deficit Control Act of 1985 and included with a budget 
submission under section 1105(a) of title 31, United States 
Code, and transmit such estimate to the chairmen of the 
Committees on the Budget of the House of Representatives and 
Senate.

           *       *       *       *       *       *       *


TITLE IX--MISCELLANEOUS PROVISIONS; EFFECTIVE DATES

           *       *       *       *       *       *       *


                     EXERCISE OF RULEMAKING POWERS

  Sec. 904. (a) The provisions of this title and of titles I, 
III, IV, and V and the provisions of sections 701, 703, and 
[1017] 1012 are enacted by the Congress--
          (1) as an exercise of the rulemaking power of the 
        House of Representatives and the Senate, respectively, 
        and as such they shall be considered as part of the 
        rules of each House, respectively, or of that House to 
        which they specifically apply, and such rules shall 
        supersede other rules only to the extent that they are 
        inconsistent therewith; and
          (2) with full recognition of the constitutional right 
        of either House to change such rules (so far as 
        relating to such House) at any time, in the same 
        manner, and to the same extent as in the case of any 
        other rule of such House.

           *       *       *       *       *       *       *

  (d) Appeals.--
          (1) Procedure.--Appeals in the Senate from the 
        decisions of the Chair relating to any provision of 
        title III or IV or section [1017] 1012 shall, except as 
        otherwise provided therein, be limited to 1 hour, to be 
        equally divided between, and controlled by, the mover 
        and the manager of the resolution, concurrent 
        resolution, reconciliation bill, or rescission bill, as 
        the case may be.

           *       *       *       *       *       *       *


TITLE X--IMPOUNDMENT CONTROL

           *       *       *       *       *       *       *


     [Part B--Congressional Consideration of Proposed Rescissions, 
            Reservations, and Deferrals of Budget Authority

                              [DEFINITIONS

  [Sec. 1011. For purposes of this part--
          [(1) ``deferral of budget authority'' includes--
                  [(A) withholding or delaying the obligations 
                or expenditure of budget authority (whether by 
                establishing reserves or otherwise) provided 
                for projects or activities; or
                  [(B) any other type of Executive action or 
                inaction which effectively precludes the 
                obligation or expenditure of budget authority, 
                including authority to obligate by contract in 
                advance of appropriations as specifically 
                authorized by law;
          [(2) ``Comptroller General'' means the Comptroller 
        General of the United States;
          [(3) ``rescission bill'' means a bill or joint 
        resolution which only recinds in whole or in part, 
        budget authority proposed to be rescinded in a special 
        message transmitted by the President under section 
        1012, and upon which the Congress completes action 
        before the end of the first period of 45 calendar days 
        of continuous session of the Congress after the date on 
        which the President's message is received by the 
        Congress;
          [(4) ``impoundment resolution'' means a resolution of 
        the House of Representatives or the Senate which only 
        expresses its disapproval of a proposed deferral of 
        budget authority set forth in a special message 
        transmitted by the President under section 1013; and
          [(5) continuity of a session of the Congress shall be 
        considered as broken only by an adjournment of the 
        Congress sine die, and the days on which either House 
        is not in session because of an adjournment of more 
        than 3 days to a day certain shall be excluded in the 
        computation of the 45-day period referred to in 
        paragraph (3) of this section and in section 1012, and 
        the 25-day periods referred to in sections 1016 and 
        1017(b)(1). If a special message is transmitted under 
        section 1012 during any Congress and the last session 
        of such Congress adjourns sine die before the 
        expiration of 45 calendar days of continuous session 
        (or a special message is so transmitted after the last 
        session of the Congress adjourns sine die), the message 
        shall be deemed to have been retransmitted on the first 
        day of the succeeding Congress and the 45-day period 
        referred to in paragraph (3) of this section and 
        section 1012 (with respect to such message) shall 
        commence on the day after such first day.

                    [RESCISSION OF BUDGET AUTHORITY

  [Sec. 1012. (a) Transmittal of Special Message.--Whenever the 
President determines that all or part of any budget authority 
will not be required to carry out the full objectives or scope 
of programs for which it is provided or that such budget 
authority should be rescinded for fiscal policy or other 
reasons (including the determination of authorized projects or 
activities for which budget authority has been provided), or 
whenever all or part of budget authority provided for only one 
fiscal year is to be reserved from obligation for such fiscal 
year, the President shall transmit to both Houses of Congress a 
special message specifying--
          [(1) the amount of budget authority which he proposes 
        to be rescinded or which is to be so reserved;
          [(2) any account, department, or establishment of the 
        Government to which such budget authority is available 
        for obligation, and the specific project or 
        governmental functions involved;
          [(3) the reasons why the budget authority should be 
        rescinded or is to be so reserved;
          [(4) to the maximum extent practicable, the estimated 
        fiscal, economic, and budgetary effect of the proposed 
        rescission or of the reservation; and
          [(5) all facts, circumstances, and considerations 
        relating to or bearing upon the proposed rescission or 
        the reservation and the decision to effect the proposed 
        rescission or the reservation, and to the maximum 
        extent practicable, the estimated effect of the 
        proposed rescission or the reservation upon the 
        objects, purposes, and programs for which the budget 
        authority is provided.
  [(b) Requirement To Make Available for Obligation.--Any 
amount of budget authority proposed to be rescinded or that is 
to be reserved as set forth in such special message shall be 
made available for obligation unless, within the prescribed 45-
day period, the Congress has completed action on a rescission 
bill rescinding all or part of the amount proposed to be 
rescinded or that is to be reserved. Funds made available for 
obligation under this procedure may not be proposed for 
rescission again.
                 [transmission of messages; publication
  [Sec. 1014. (a) Delivery to House and Senate.--Each special 
message transmitted under section 1012 or 1013 shall be 
transmitted to the House of Representatives and the Senate on 
the same day, and shall be delivered to the Clerk of the House 
of Representatives if the House is not in session, and to the 
Secretary of the Senate if the Senate is not in session. Each 
special message so transmitted shall be referred to the 
appropriate committee of the House of Representatives and the 
Senate. Each such message shall be printed as a document of 
each House.
  [(b) Delivery to Comptroller General.--A copy of each special 
message transmitted under section 1012 or 1013 shall be 
transmitted to the Comptroller General on the same day it is 
transmitted to the House of Representatives and the Senate. In 
order to assist the Congress in the exercise of its functions 
under sections 1012 and 1013, the Comptroller General shall 
review each such message and inform the House of 
Representatives and the Senate as promptly as practicable with 
respect to----
          [(1) in the case of a special message transmitted 
        under section 1012, the facts surrounding the proposed 
        rescission or the reservation of budget authority 
        (including the probable effects thereof); and
          [(2) in the case of a special message transmitted 
        under section 1013, (A) the facts surrounding each 
        proposed deferral of budget authority (including the 
        probable effects thereof) and (B) whether or not (or to 
        what extent), in his judgment, such proposed deferral 
        is in accordance with existing statutory authority.
  [(c) Transmission of Supplementary Messages.--If any 
information contained in a special message transmitted under 
section 1012 or 1013 is subsequently revised, the President 
shall transmit to both Houses of Congress and the Comptroller 
General a supplementary message stating and explaining such 
revision. Any such supplementary message shall be delivered, 
referred, and printed as provided in subsection (a). The 
Comptroller General shall promptly notify the House of 
Representatives and the Senate of any change in the information 
submitted by him under subsection (b) which may be necessitated 
by such revision.
  [(d) Printing in Federal Register.--Any special message 
transmitted under section 1012 or 1013, and any supplementary 
message transmitted under subsection (c), shall be printed in 
the first issue of the Federal Register published after such 
transmittal.
  [(e) Cumulative Reports of Proposed Rescissions, 
Reservations, and Deferrals of Budget Authority.--
          [(1) The President shall submit a report to the House 
        of Representatives and the Senate, not later than the 
        10th day of each month during a fiscal year, listing 
        all budget authority for that fiscal year with respect 
        to which, as of the first day of such month--
                  [(A) he has transmitted a special message 
                under section 1012 with respect to a proposed 
                rescission or a reservation; and
                  [(B) he has transmitted a special message 
                under section 1013 proposing a deferral.
        Such report shall also contain, with respect to each 
        such proposed rescission or deferral, or each such 
        reservation, the information required to be submitted 
        in the special message with respect thereto under 
        section 1012 or 1013.
          [(2) Each report submitted under paragraph (1) shall 
        be printed in the first issue of the Federal Register 
        published after its submission.
                    [reports by comptroller general
  [Sec. 1015. (a) Failure To Transmit Special Message.--If the 
Comptroller General finds that the President, the Director of 
the Office of Management and Budget, the head of any department 
or agency of the United States, or any other officer or 
employee of the United States--
          [(1) is to establish a reserve or proposes to defer 
        budget authority with respect to which the President is 
        required to transmit a special message under section 
        1012 or 1013; or
          [(2) has ordered, permitted, or approved the 
        establishment of such a reserve or a deferral of budget 
        authority;
and that the President has failed to transmit a special message 
with respect to such reserve or deferral, the Comptroller 
General shall make a report on such reserve or deferral and any 
available information concerning it to both Houses of Congress. 
The provisions of this part shall apply with respect to such 
reserve or deferral in the same manner and with the same effect 
as if such report of the Comptroller General were a special 
message transmitted by the President under section 1012 or 
1013, and, for purposes of this part, such report shall be 
considered a special message transmitted under section 1012 or 
1013.
  [(b) Incorrect Classification of Special Message.--If the 
President has transmitted a special message to both Houses of 
Congress in accordance with section 1012 or 1013, and the 
Comptroller General believes that the President so transmitted 
the special message in accordance with one of those sections 
when the special message should have been transmitted in 
accordance with the other of those sections, the Comptroller 
General shall make a report to both Houses of the Congress 
setting forth his reasons.
                     [procedure in house and senate
  [Sec. 1017. (a) Referral.--Any rescission bill introduced 
with respect to a special message or impoundment resolution 
introduced with respect to a proposed deferral of budget 
authority shall be referred to the appropriate committee of the 
House of Representatives or the Senate, as the case may be.
  [(b) Discharge of Committee.--
          [(1) If the committee to which a rescission bill or 
        impoundment resolution has been referred has not 
        reported it at the end of 25 calendar days of 
        continuous session of the Congress after its 
        introduction, it is in order to move either to 
        discharge the committee from further consideration of 
        the bill or resolution or to discharge the committee 
        from further consideration of any other rescission bill 
        with respect to the same special message or impoundment 
        resolution with respect to the same proposed deferral, 
        as the case may be, which has been referred to the 
        committee.
          [(2) A motion to discharge may be made only by an 
        individual favoring the bill or resolution, may be made 
        only if supported by one-fifth of the Members of the 
        House involved (a quorum being present), and is highly 
        privileged in the House and privileged in the Senate 
        (except that it may not be made after the committee has 
        reported a bill or resolution with respect to the same 
        special message or the same proposed deferral, as the 
        case may be); and debate thereon shall be limited to 
        not more than 1 hour, the time to be divided in the 
        House equally between those favoring and those opposing 
        the bill or resolution, and to be divided in the Senate 
        equally between, and controlled by, the majority leader 
        and the minority leader or their designees. An 
        amendment to the motion is not in order, and it is not 
        in order to move to reconsider the vote by which the 
        motion is agreed to or disagreed to.
  [(c) Floor Consideration in the House.--
          [(1) When the committee of the House of 
        Representatives has reported, or has been discharged 
        from further consideration of a rescission bill or 
        impoundment resolution, it shall at any time thereafter 
        be in order (even though a previous motion to the same 
        effect has been disagreed to) to move to proceed to the 
        consideration of the bill or resolution. The motion 
        shall be highly privileged and not debatable. An 
        amendment to the motion shall not be in order, nor 
        shall it be in order to move to reconsider the vote by 
        which the motion is agreed to or disagreed to.
          [(2) Debate on a rescission bill or impoundment 
        resolution shall be limited to not more than 2 hours, 
        which shall be divided equally between those favoring 
        and those opposing the bill or resolution. A motion 
        further to limit debate shall not be debatable. In the 
        case of an impoundment resolution, no amendment to, or 
        motion to recommit, the resolution shall be in order. 
        It shall not be in order to move to reconsider the vote 
        by which a rescission bill or impoundment resolution is 
        agreed to or disagreed to.
          [(3) Motions to postpone, made with respect to the 
        consideration of a rescission bill or impoundment 
        resolution, and motions to proceed to the consideration 
        of other business, shall be decided without debate.
          [(4) All appeals from the decisions of the Chair 
        relating to the application of the Rules of the House 
        of Representatives to the procedure relating to any 
        rescission bill or impoundment resolution shall be 
        decided without debate.
          [(5) Except to the extent specifically provided in 
        the preceding provisions of this subsection, 
        consideration of any rescission bill or impoundment 
        resolution and amendments thereto (or any conference 
        report thereon) shall be governed by the Rules of the 
        House of Representatives applicable to other bills and 
        resolutions, amendments, and conference reports in 
        similar circumstances.
  [(d) Floor Consideration in the Senate.--
          [(1) Debate in the Senate on any rescission bill or 
        impoundment resolution, and all amendments thereto (in 
        the case of a rescission bill) and debatable motions 
        and appeals in connection therewith, shall be limited 
        to not more than 10 hours. The time shall be equally 
        divided between, and controlled by, the majority leader 
        and the minority leader or their designees.
          [(2) Debate in the Senate on any amendment to a 
        rescission bill shall be limited to 2 hours, to be 
        equally divided between, and controlled by, the mover 
        and the manager of the bill. Debate on any amendment to 
        an amendment, to such a bill, and debate on any 
        debatable motion or appeal in connection with such a 
        bill or an impoundment resolution shall be limited to 1 
        hour, to be equally divided between, and controlled by, 
        the mover and the manager of the bill or resolution, 
        except that in the event the manager of the bill or 
        resolution is in favor in any such amendment, motion, 
        or appeal, the time in opposition thereto, shall be 
        controlled by the minority leader or his designee. No 
        amendment that is not germane to the provisions of a 
        rescission bill shall be received. Such leaders, or 
        either of them, may, from the time under their control 
        on the passage of a rescission bill or impoundment 
        resolution, allot additional time to any Senator during 
        the consideration of any amendment, debatable motion, 
        or appeal.
          [(3) A motion to further limit debate is not 
        debatable. In the case of a rescission bill, a motion 
        to recommit (except a motion to recommit with 
        instructions to report back within a specified number 
        of days, not to exceed 3, not counting any day on which 
        the Senate is not in session) is not in order. Debate 
        on any such motion to recommit shall be limited to one 
        hour, to be equally divided between, and controlled by, 
        the mover and the manager of the concurrent resolution. 
        In the case of an impoundment resolution, no amendment 
        or motion to recommit is in order.
          [(4) The conference report on any rescission bill 
        shall be in order in the Senate at any time after the 
        third day (excluding Saturdays, Sundays, and legal 
        holidays) following the day on which such a conference 
        report is reported and is available to Members of the 
        Senate. A motion to proceed to the consideration of the 
        conference report may be made even though a previous 
        motion to the same effect has been disagreed to.
          [(5) During the consideration in the Senate of the 
        conference report on any rescission bill, debate shall 
        be limited to 2 hours, to be equally divided between, 
        and controlled by, the majority leader and minority 
        leader or their designees. Debate on any debatable 
        motion or appeal related to the conference report shall 
        be limited to 30 minutes, to be equally divided 
        between, and controlled by, the mover and the manager 
        of the conference report.
          [(6) Should the conference report be defeated, debate 
        on any request for a new conference and the appointment 
        of conferees shall be limited to one hour, to be 
        equally divided, between, and controlled by, the 
        manager of the conference report and the minority 
        leader or his designee, and should any motion be made 
        to instruct the conferees before the conferees are 
        named, debate on such motion shall be limited to 30 
        minutes, to be equally divided between, and controlled 
        by, the mover and the manager of the conference report. 
        Debate on any amendment to any such instructions shall 
        be limited to 20 minutes, to be equally divided 
        between, and controlled by the mover and the manager of 
        the conference report. In all cases when the manager of 
        the conference report is in favor of any motion, 
        appeal, or amendment, the time in opposition shall be 
        under the control of the minority leader or his 
        designee.
          [(7) In any case in which there are amendments in 
        disagreement, time on each amendment shall be limited 
        to 30 minutes, to be equally divided between, and 
        controlled by, the manager of the conference report and 
        the minority leader or his designee. No amendment that 
        is not germane to the provisions of such amendments 
        shall be received.

                        [Part C--Line Item Veto

                       [line item veto authority
  [Sec. 1021. (a) In General.--Notwithstanding the provisions 
of parts A and B, and subject to the provisions of this part, 
the President may, with respect to any bill or joint resolution 
that has been signed into law pursuant to Article I, section 7, 
of the Constitution of the United States, cancel in whole--
          [(1) any dollar amount of discretionary budget 
        authority;
          [(2) any item of new direct spending; or
          [(3) any limited tax benefit;
if the President--
          [(A) determines that such cancellation will--
                  [(i) reduce the Federal budget deficit;
                  [(ii) not impair any essential Government 
                functions; and
                  [(iii) not harm the national interest; and
          [(B) notifies the Congress of such cancellation by 
        transmitting a special message, in accordance with 
        section 1022, within five calendar days (excluding 
        Sundays) after the enactment of the law providing the 
        dollar amount of discretionary budget authority, item 
        of new direct spending, or limited tax benefit that was 
        canceled.
  [(b) Identification of Cancellations.--In identifying dollar 
amounts of discretionary budget authority, items of new direct 
spending, and limited tax benefits for cancellation, the 
President shall--
          [(1) consider the legislative history, construction, 
        and purposes of the law which contains such dollar 
        amounts, items, or benefits;
          [(2) consider any specific sources of information 
        referenced in such law or, in the absence of specific 
        sources of information, the best available information; 
        and
          [(3) use the definitions contained in section 1026 in 
        applying this part to the specific provisions of such 
        law.
  [(c) Exception for Disapproval Bills.--The authority granted 
by subsection (a) shall not apply to any dollar amount of 
discretionary budget authority, item of new direct spending, or 
limited tax benefit contained in any law that is a disapproval 
bill as defined in section 1026.
                           [special messages
  [Sec. 1022. (a) In General.--For each law from which a 
cancellation has been made under this part, the President shall 
transmit a single special message to the Congress.
  [(b) Contents.--
          [(1) The special message shall specify--
                  [(A) the dollar amount of discretionary 
                budget authority, item of new direct spending, 
                or limited tax benefit which has been canceled, 
                and provide a corresponding reference number 
                for each cancellation;
                  [(B) the determinations required under 
                section 1021(a), together with any supporting 
                material;
                  [(C) the reasons for the cancellation;
                  [(D) to the maximum extent practicable, the 
                estimated fiscal, economic, and budgetary 
                effect of the cancellation;
                  [(E) all facts, circumstances and 
                considerations relating to or bearing upon the 
                cancellation, and to the maximum extent 
                practicable, the estimated effect of the 
                cancellation upon the objects, purposes and 
                programs for which the canceled authority was 
                provided; and
                  [(F) include the adjustments that will be 
                made pursuant to section 1024 to the 
                discretionary spending limits under section 
                251(c) of the Balanced Budget and Emergency 
                Deficit Control Act of 1985 and an evaluation 
                of the effects of those adjustments upon the 
                sequestration procedures of section 251 of the 
                Balanced Budget and Emergency Deficit Control 
                Act of 1985.
          [(2) In the case of a cancellation of any dollar 
        amount of discretionary budget authority or item of new 
        direct spending, the special message shall also 
        include, if applicable--
                  [(A) any account, department, or 
                establishment of the Government for which such 
                budget authority was to have been available for 
                obligation and the specific project or 
                governmental functions involved;
                  [(B) the specific States and congressional 
                districts, if any, affected by the 
                cancellation; and
                  [(C) the total number of cancellations 
                imposed during the current session of Congress 
                on States and congressional districts 
                identified in subparagraph (B).
  [(c) Transmission of Special Messages to House and Senate.--
          [(1) The President shall transmit to the Congress 
        each special message under this part within five 
        calendar days (excluding Sundays) after enactment of 
        the law to which the cancellation applies. Each special 
        message shall be transmitted to the House of 
        Representatives and the Senate on the same calendar 
        day. Such special message shall be delivered to the 
        Clerk of the House of Representatives if the House is 
        not in session, and to the Secretary of the Senate if 
        the Senate is not in session.
          [(2) Any special message transmitted under this part 
        shall be printed in the first issue of the Federal 
        Register published after such transmittal.
               [cancellation effective unless disapproved
  [Sec. 1023. (a) In General.--The cancellation of any dollar 
amount of discretionary budget authority, item of new direct 
spending, or limited tax benefit shall take effect upon receipt 
in the House of Representatives and the Senate of the special 
message notifying the Congress of the cancellation. If a 
disapproval bill for such special message is enacted into law, 
then all cancellations disapproved in that law shall be null 
and void and any such dollar amount of discretionary budget 
authority, item of new direct spending, or limited tax benefit 
shall be effective as of the original date provided in the law 
to which the cancellation applied.
  [(b) Commensurate Reductions in Discretionary Budget 
Authority.--Upon the cancellation of a dollar amount of 
discretionary budget authority under subsection (a), the total 
appropriation for each relevant account of which that dollar 
amount is a part shall be simultaneously reduced by the dollar 
amount of that cancellation.
                           [deficit reduction
  [Sec. 1024. (a) In General.--
          [(1) Discretionary budget authority.--OMB shall, for 
        each dollar amount of discretionary budget authority 
        and for each item of new direct spending canceled from 
        an appropriation law under section 1021(a)--
                  [(A) reflect the reduction that results from 
                such cancellation in the estimates required by 
                section 251(a)(7) of the Balanced Budget and 
                Emergency Deficit Control Act of 1985 in 
                accordance with that Act, including an estimate 
                of the reduction of the budget authority and 
                the reduction in outlays flowing from such 
                reduction of budget authority for each outyear; 
                and
                  [(B) include a reduction to the discretionary 
                spending limits for budget authority and 
                outlays in accordance with the Balanced Budget 
                and Emergency Deficit Control Act of 1985 for 
                each applicable fiscal year set forth in 
                section 251(c) of the Balanced Budget and 
                Emergency Deficit Control Act of 1985 by 
                amounts equal to the amounts for each fiscal 
                year estimated pursuant to subparagraph (A).
          [(2) Direct spending and limited tax benefits.--(A) 
        OMB shall, for each item of new direct spending or 
        limited tax benefit canceled from a law under section 
        1021(a), estimate the deficit decrease caused by the 
        cancellation of such item or benefit in that law and 
        include such estimate as a separate entry in the report 
        prepared pursuant to section 252(d) of the Balanced 
        Budget and Emergency Deficit Control Act of 1985.
          [(B) OMB shall not include any change in the deficit 
        resulting from a cancellation of any item of new direct 
        spending or limited tax benefit, or the enactment of a 
        disapproval bill for any such cancellation, under this 
        part in the estimates and reports required by sections 
        252(b) and 254 of the Balanced Budget and Emergency 
        Deficit Control Act of 1985.
  [(b) Adjustments to Spending Limits.--After ten calendar days 
(excluding Sundays) after the expiration of the time period in 
section 1025(b)(1) for expedited congressional consideration of 
a disapproval bill for a special message containing a 
cancellation of discretionary budget authority, OMB shall make 
the reduction included in subsection (a)(1)(B) as part of the 
next sequester report required by section 254 of the Balanced 
Budget and Emergency Deficit Control Act of 1985.
  [(c) Exception.--Subsection (b) shall not apply to a 
cancellation if a disapproval bill or other law that 
disapproves that cancellation is enacted into law prior to 10 
calendar days (excluding Sundays) after the expiration of the 
time period set forth in section 1025(b)(1).
  [(d) Congressional Budget Office Estimates.--As soon as 
practicable after the President makes a cancellation from a law 
under section 1021(a), the Director of the Congressional Budget 
Office shall provide the Committees on the Budget of the House 
of Representatives and the Senate with an estimate of the 
reduction of the budget authority and the reduction in outlays 
flowing from such reduction of budget authority for each 
outyear.
      [expedited congressional consideration of disapproval bills
  [Sec. 1025. (a) Receipt and Referral of Special Message.--
Each special message transmitted under this part shall be 
referred to the Committee on the Budget and the appropriate 
committee or committees of the Senate and the Committee on the 
Budget and the appropriate committee or committees of the House 
of Representatives. Each such message shall be printed as a 
document of the House of Representatives.
  [(b) Time Period for Expedited Procedures.--
          [(1) There shall be a congressional review period of 
        30 calendar days of session, beginning on the first 
        calendar day of session after the date on which the 
        special message is received in the House of 
        Representatives and the Senate, during which the 
        procedures contained in this section shall apply to 
        both Houses of Congress.
          [(2) In the House of Representatives the procedures 
        set forth in this section shall not apply after the end 
        of the period described in paragraph (1).
          [(3) If Congress adjourns at the end of a Congress 
        prior to the expiration of the period described in 
        paragraph (1) and a disapproval bill was then pending 
        in either House of Congress or a committee thereof 
        (including a conference committee of the two Houses of 
        Congress), or was pending before the President, a 
        disapproval bill for the same special message may be 
        introduced within the first five calendar days of 
        session of the next Congress and shall be treated as a 
        disapproval bill under this part, and the time period 
        described in paragraph (1) shall commence on the day of 
        introduction of that disapproval bill.
  [(c) Introduction of Disapproval Bills.--(1) In order for a 
disapproval bill to be considered under the procedures set 
forth in this section, the bill must meet the definition of a 
disapproval bill and must be introduced no later than the fifth 
calendar day of session following the beginning of the period 
described in subsection (b)(1).
  [(2) In the case of a disapproval bill introduced in the 
House of Representatives, such bill shall include in the first 
blank space referred to in section 1026(6)(C) a list of the 
reference numbers for all cancellations made by the President 
in the special message to which such disapproval bill relates.
  [(d) Consideration in the House of Representatives.--(1) Any 
committee of the House of Representatives to which a 
disapproval bill is referred shall report it without amendment, 
and with or without recommendation, not later than the seventh 
calendar day of session after the date of its introduction. If 
any committee fails to report the bill within that period, it 
is in order to move that the House discharge the committee from 
further consideration of the bill, except that such a motion 
may not be made after the committee has reported a disapproval 
bill with respect to the same special message. A motion to 
discharge may be made only by a Member favoring the bill (but 
only at a time or place designated by the Speaker in the 
legislative schedule of the day after the calendar day on which 
the Member offering the motion announces to the House his 
intention to do so and the form of the motion). The motion is 
highly privileged. Debate thereon shall be limited to not more 
than one hour, the time to be divided in the House equally 
between a proponent and an opponent. The previous question 
shall be considered as ordered on the motion to its adoption 
without intervening motion. A motion to reconsider the vote by 
which the motion is agreed to or disagreed to shall not be in 
order.
  [(2) After a disapproval bill is reported or a committee has 
been discharged from further consideration, it is in order to 
move that the House resolve into the Committee of the Whole 
House on the State of the Union for consideration of the bill. 
If reported and the report has been available for at least one 
calendar day, all points of order against the bill and against 
consideration of the bill are waived. If discharged, all points 
of order against the bill and against consideration of the bill 
are waived. The motion is highly privileged. A motion to 
reconsider the vote by which the motion is agreed to or 
disagreed to shall not be in order. During consideration of the 
bill in the Committee of the Whole, the first reading of the 
bill shall be dispensed with. General debate shall proceed, 
shall be confined to the bill, and shall not exceed one hour 
equally divided and controlled by a proponent and an opponent 
of the bill. The bill shall be considered as read for amendment 
under the five-minute rule. Only one motion to rise shall be in 
order, except if offered by the manager. No amendment to the 
bill is in order, except any Member if supported by 49 other 
Members (a quorum being present) may offer an amendment 
striking the reference number or numbers of a cancellation or 
cancellations from the bill. Consideration of the bill for 
amendment shall not exceed one hour excluding time for recorded 
votes and quorum calls. No amendment shall be subject to 
further amendment, except pro forma amendments for the purposes 
of debate only. At the conclusion of the consideration of the 
bill for amendment, the Committee shall rise and report the 
bill to the House with such amendments as may have been 
adopted. The previous question shall be considered as ordered 
on the bill and amendments thereto to final passage without 
intervening motion. A motion to reconsider the vote on passage 
of the bill shall not be in order.
  [(3) Appeals from decisions of the Chair regarding 
application of the rules of the House of Representatives to the 
procedure relating to a disapproval bill shall be decided 
without debate.
  [(4) It shall not be in order to consider under this 
subsection more than one disapproval bill for the same special 
message except for consideration of a similar Senate bill 
(unless the House has already rejected a disapproval bill for 
the same special message) or more than one motion to discharge 
described in paragraph (1) with respect to a disapproval bill 
for that special message.
  [(e) Consideration in the Senate.--
          [(1) Referral and reporting.--Any disapproval bill 
        introduced in the Senate shall be referred to the 
        appropriate committee or committees. A committee to 
        which a disapproval bill has been referred shall report 
        the bill not later than the seventh day of session 
        following the date of introduction of that bill. If any 
        committee fails to report the bill within that period, 
        that committee shall be automatically discharged from 
        further consideration of the bill and the bill shall be 
        placed on the Calendar.
          [(2) Disapproval bill from house.--When the Senate 
        receives from the House of Representatives a 
        disapproval bill, such bill shall not be referred to 
        committee and shall be placed on the Calendar.
          [(3) Consideration of single disapproval bill.--After 
        the Senate has proceeded to the consideration of a 
        disapproval bill for a special message, then no other 
        disapproval bill originating in that same House 
        relating to that same message shall be subject to the 
        procedures set forth in this subsection.
          [(4) Amendments.--
                  [(A) Amendments in order.--The only 
                amendments in order to a disapproval bill are--
                          [(i) an amendment that strikes the 
                        reference number of a cancellation from 
                        the disapproval bill; and
                          [(ii) an amendment that only inserts 
                        the reference number of a cancellation 
                        included in the special message to 
                        which the disapproval bill relates that 
                        is not already contained in such bill.
                  [(B) Waiver or appeal.--An affirmative vote 
                of three-fifths of the Senators, duly chosen 
                and sworn, shall be required in the Senate--
                          [(i) to waive or suspend this 
                        paragraph; or
                          [(ii) to sustain an appeal of the 
                        ruling of the Chair on a point of order 
                        raised under this paragraph.
          [(5) Motion nondebatable.--A motion to proceed to 
        consideration of a disapproval bill under this 
        subsection shall not be debatable. It shall not be in 
        order to move to reconsider the vote by which the 
        motion to proceed was adopted or rejected, although 
        subsequent motions to proceed may be made under this 
        paragraph.
          [(6) Limit on consideration.--(A) After no more than 
        10 hours of consideration of a disapproval bill, the 
        Senate shall proceed, without intervening action or 
        debate (except as permitted under paragraph (9)), to 
        vote on the final disposition thereof to the exclusion 
        of all amendments not then pending and to the exclusion 
        of all motions, except a motion to reconsider or to 
        table.
          [(B) A single motion to extend the time for 
        consideration under subparagraph (A) for no more than 
        an additional five hours is in order prior to the 
        expiration of such time and shall be decided without 
        debate.
          [(C) The time for debate on the disapproval bill 
        shall be equally divided between the Majority Leader 
        and the Minority Leader or their designees.
          [(7) Debate on amendments.--Debate on any amendment 
        to a disapproval bill shall be limited to one hour, 
        equally divided and controlled by the Senator proposing 
        the amendment and the majority manager, unless the 
        majority manager is in favor of the amendment, in which 
        case the minority manager shall be in control of the 
        time in opposition.
          [(8) No motion to recommit.--A motion to recommit a 
        disapproval bill shall not be in order.
          [(9) Disposition of senate disapproval bill.--If the 
        Senate has read for the third time a disapproval bill 
        that originated in the Senate, then it shall be in 
        order at any time thereafter to move to proceed to the 
        consideration of a disapproval bill for the same 
        special message received from the House of 
        Representatives and placed on the Calendar pursuant to 
        paragraph (2), strike all after the enacting clause, 
        substitute the text of the Senate disapproval bill, 
        agree to the Senate amendment, and vote on final 
        disposition of the House disapproval bill, all without 
        any intervening action or debate.
          [(10) Consideration of house message.--Consideration 
        in the Senate of all motions, amendments, or appeals 
        necessary to dispose of a message from the House of 
        Representatives on a disapproval bill shall be limited 
        to not more than four hours. Debate on each motion or 
        amendment shall be limited to 30 minutes. Debate on any 
        appeal or point of order that is submitted in 
        connection with the disposition of the House message 
        shall be limited to 20 minutes. Any time for debate 
        shall be equally divided and controlled by the 
        proponent and the majority manager, unless the majority 
        manager is a proponent of the motion, amendment, 
        appeal, or point of order, in which case the minority 
        manager shall be in control of the time in opposition.
  [(f) Consideration in Conference.--
          [(1) Convening of conference.--In the case of 
        disagreement between the two Houses of Congress with 
        respect to a disapproval bill passed by both Houses, 
        conferees should be promptly appointed and a conference 
        promptly convened, if necessary.
          [(2) House consideration.--(A) Notwithstanding any 
        other rule of the House of Representatives, it shall be 
        in order to consider the report of a committee of 
        conference relating to a disapproval bill provided such 
        report has been available for one calendar day 
        (excluding Saturdays, Sundays, or legal holidays, 
        unless the House is in session on such a day) and the 
        accompanying statement shall have been filed in the 
        House.
          [(B) Debate in the House of Representatives on the 
        conference report and any amendments in disagreement on 
        any disapproval bill shall each be limited to not more 
        than one hour equally divided and controlled by a 
        proponent and an opponent. A motion to further limit 
        debate is not debatable. A motion to recommit the 
        conference report is not in order, and it is not in 
        order to move to reconsider the vote by which the 
        conference report is agreed to or disagreed to.
          [(3) Senate consideration.--Consideration in the 
        Senate of the conference report and any amendments in 
        disagreement on a disapproval bill shall be limited to 
        not more than four hours equally divided and controlled 
        by the Majority Leader and the Minority Leader or their 
        designees. A motion to recommit the conference report 
        is not in order.
          [(4) Limits on scope.--(A) When a disagreement to an 
        amendment in the nature of a substitute has been 
        referred to a conference, the conferees shall report 
        those cancellations that were included in both the bill 
        and the amendment, and may report a cancellation 
        included in either the bill or the amendment, but shall 
        not include any other matter.
          [(B) When a disagreement on an amendment or 
        amendments of one House to the disapproval bill of the 
        other House has been referred to a committee of 
        conference, the conferees shall report those 
        cancellations upon which both Houses agree and may 
        report any or all of those cancellations upon which 
        there is disagreement, but shall not include any other 
        matter.
                              [definitions
  [Sec. 1026. As used in this part:
          [(1) Appropriation law.--The term ``appropriation 
        law'' means an Act referred to in section 105 of title 
        1, United States Code, including any general or special 
        appropriation Act, or any Act making supplemental, 
        deficiency, or continuing appropriations, that has been 
        signed into law pursuant to Article I, section 7, of 
        the Constitution of the United States.
          [(2) Calendar day.--The term ``calendar day'' means a 
        standard 24-hour period beginning at midnight.
          [(3) Calendar days of session.--The term ``calendar 
        days of session'' shall mean only those days on which 
        both Houses of Congress are in session.
          [(4) Cancel.--The term ``cancel'' or ``cancellation'' 
        means--
                  [(A) with respect to any dollar amount of 
                discretionary budget authority, to rescind;
                  [(B) with respect to any item of new direct 
                spending--
                          [(i) that is budget authority 
                        provided by law (other than an 
                        appropriation law), to prevent such 
                        budget authority from having legal 
                        force or effect;
                          [(ii) that is entitlement authority, 
                        to prevent the specific legal 
                        obligation of the United States from 
                        having legal force or effect; or
                          [(iii) through the food stamp 
                        program, to prevent the specific 
                        provision of law that results in an 
                        increase in budget authority or outlays 
                        for that program from having legal 
                        force or effect; and
                  [(C) with respect to a limited tax benefit, 
                to prevent the specific provision of law that 
                provides such benefit from having legal force 
                or effect.
          [(5) Direct spending.--The term ``direct spending'' 
        means--
                  [(A) budget authority provided by law (other 
                than an appropriation law);
                  [(B) entitlement authority; and
                  [(C) the food stamp program.
          [(6) Disapproval bill.--The term ``disapproval bill'' 
        means a bill or joint resolution which only disapproves 
        one or more cancellations of dollar amounts of 
        discretionary budget authority, items of new direct 
        spending, or limited tax benefits in a special message 
        transmitted by the President under this part and--
                  [(A) the title of which is as follows: ``A 
                bill disapproving the cancellations transmitted 
                by the President on ____'', the blank space 
                being filled in with the date of transmission 
                of the relevant special message and the public 
                law number to which the message relates;
                  [(B) which does not have a preamble; and
                  [(C) which provides only the following after 
                the enacting clause: ``That Congress 
                disapproves of cancellations ____'', the blank 
                space being filled in with a list by reference 
                number of one or more cancellations contained 
                in the President's special message, ``as 
                transmitted by the President in a special 
                message on ____'', the blank space being filled 
                in with the appropriate date, ``regarding 
                ____.'', the blank space being filled in with 
                the public law number to which the special 
                message relates.
          [(7) Dollar amount of discretionary budget 
        authority.--(A) Except as provided in subparagraph (B), 
        the term ``dollar amount of discretionary budget 
        authority'' means the entire dollar amount of budget 
        authority--
                  [(i) specified in an appropriation law, or 
                the entire dollar amount of budget authority 
                required to be allocated by a specific proviso 
                in an appropriation law for which a specific 
                dollar figure was not included;
                  [(ii) represented separately in any table, 
                chart, or explanatory text included in the 
                statement of managers or the governing 
                committee report accompanying such law;
                  [(iii) required to be allocated for a 
                specific program, project, or activity in a law 
                (other than an appropriation law) that mandates 
                the expenditure of budget authority from 
                accounts, programs, projects, or activities for 
                which budget authority is provided in an 
                appropriation law;
                  [(iv) represented by the product of the 
                estimated procurement cost and the total 
                quantity of items specified in an appropriation 
                law or included in the statement of managers or 
                the governing committee report accompanying 
                such law; or
                  [(v) represented by the product of the 
                estimated procurement cost and the total 
                quantity of items required to be provided in a 
                law (other than an appropriation law) that 
                mandates the expenditure of budget authority 
                from accounts, programs, projects, or 
                activities for which budget authority is 
                provided in an appropriation law.
          [(B) The term ``dollar amount of discretionary budget 
        authority'' does not include--
                  [(i) direct spending;
                  [(ii) budget authority in an appropriation 
                law which funds direct spending provided for in 
                other law;
                  [(iii) any existing budget authority 
                rescinded or canceled in an appropriation law; 
                or
                  [(iv) any restriction, condition, or 
                limitation in an appropriation law or the 
                accompanying statement of managers or committee 
                reports on the expenditure of budget authority 
                for an account, program, project, or activity, 
                or on activities involving such expenditure.
          [(8) Item of new direct spending.--The term ``item of 
        new direct spending'' means any specific provision of 
        law that is estimated to result in an increase in 
        budget authority or outlays for direct spending 
        relative to the most recent levels calculated pursuant 
        to section 257 of the Balanced Budget and Emergency 
        Deficit Control Act of 1985.
          [(9) Limited tax benefit.--(A) The term ``limited tax 
        benefit'' means--
                  [(i) any revenue-losing provision which 
                provides a Federal tax deduction, credit, 
                exclusion, or preference to 100 or fewer 
                beneficiaries under the Internal Revenue Code 
                of 1986 in any fiscal year for which the 
                provision is in effect; and
                  [(ii) any Federal tax provision which 
                provides temporary or permanent transitional 
                relief for 10 or fewer beneficiaries in any 
                fiscal year from a change to the Internal 
                Revenue Code of 1986.
          [(B) A provision shall not be treated as described in 
        subparagraph (A)(i) if the effect of that provision is 
        that--
                  [(i) all persons in the same industry or 
                engaged in the same type of activity receive 
                the same treatment;
                  [(ii) all persons owning the same type of 
                property, or issuing the same type of 
                investment, receive the same treatment; or
                  [(iii) any difference in the treatment of 
                persons is based solely on--
                          [(I) in the case of businesses and 
                        associations, the size or form of the 
                        business or association involved;
                          [(II) in the case of individuals, 
                        general demographic conditions, such as 
                        income, marital status, number of 
                        dependents, or tax return filing 
                        status;
                          [(III) the amount involved; or
                          [(IV) a generally-available election 
                        under the Internal Revenue Code of 
                        1986.
          [(C) A provision shall not be treated as described in 
        subparagraph (A)(ii) if--
                  [(i) it provides for the retention of prior 
                law with respect to all binding contracts or 
                other legally enforceable obligations in 
                existence on a date contemporaneous with 
                congressional action specifying such date; or
                  [(ii) it is a technical correction to 
                previously enacted legislation that is 
                estimated to have no revenue effect.
          [(D) For purposes of subparagraph (A)--
                  [(i) all businesses and associations which 
                are related within the meaning of sections 
                707(b) and 1563(a) of the Internal Revenue Code 
                of 1986 shall be treated as a single 
                beneficiary;
                  [(ii) all qualified plans of an employer 
                shall be treated as a single beneficiary;
                  [(iii) all holders of the same bond issue 
                shall be treated as a single beneficiary; and
                  [(iv) if a corporation, partnership, 
                association, trust or estate is the beneficiary 
                of a provision, the shareholders of the 
                corporation, the partners of the partnership, 
                the members of the association, or the 
                beneficiaries of the trust or estate shall not 
                also be treated as beneficiaries of such 
                provision.
          [(E) For purposes of this paragraph, the term 
        ``revenue-losing provision'' means any provision which 
        results in a reduction in Federal tax revenues for any 
        one of the two following periods--
                  [(i) the first fiscal year for which the 
                provision is effective; or
                  [(ii) the period of the 5 fiscal years 
                beginning with the first fiscal year for which 
                the provision is effective.
          [(F) The terms used in this paragraph shall have the 
        same meaning as those terms have generally in the 
        Internal Revenue Code of 1986, unless otherwise 
        expressly provided.
          [(10) OMB.--The term ``OMB'' means the Director of 
        the Office of Management and Budget.
                [identification of limited tax benefits
  [Sec. 1027. (a) Statement by Joint Tax Committee.--The Joint 
Committee on Taxation shall review any revenue or 
reconciliation bill or joint resolution which includes any 
amendment to the Internal Revenue Code of 1986 that is being 
prepared for filing by a committee of conference of the two 
Houses, and shall identify whether such bill or joint 
resolution contains any limited tax benefits. The Joint 
Committee on Taxation shall provide to the committee of 
conference a statement identifying any such limited tax 
benefits or declaring that the bill or joint resolution does 
not contain any limited tax benefits. Any such statement shall 
be made available to any Member of Congress by the Joint 
Committee on Taxation immediately upon request.
  [(b) Statement Included in Legislation.--(1) Notwithstanding 
any other rule of the House of Representatives or any rule or 
precedent of the Senate, any revenue or reconciliation bill or 
joint resolution which includes any amendment to the Internal 
Revenue Code of 1986 reported by a committee of conference of 
the two Houses may include, as a separate section of such bill 
or joint resolution, the information contained in the statement 
of the Joint Committee on Taxation, but only in the manner set 
forth in paragraph (2).
  [(2) The separate section permitted under paragraph (1) shall 
read as follows: ``Section 1021(a)(3) of the Congressional 
Budget and Impoundment Control Act of 1974 shall ____ apply to 
______.'', with the blank spaces being filled in with--
          [(A) in any case in which the Joint Committee on 
        Taxation identifies limited tax benefits in the 
        statement required under subsection (a), the word 
        ``only'' in the first blank space and a list of all of 
        the specific provisions of the bill or joint resolution 
        identified by the Joint Committee on Taxation in such 
        statement in the second blank space; or
          [(B) in any case in which the Joint Committee on 
        Taxation declares that there are no limited tax 
        benefits in the statement required under subsection 
        (a), the word ``not'' in the first blank space and the 
        phrase ``any provision of this Act'' in the second 
        blank space.
  [(c) President's Authority.--If any revenue or reconciliation 
bill or joint resolution is signed into law pursuant to Article 
I, section 7, of the Constitution of the United States--
          [(1) with a separate section described in subsection 
        (b)(2), then the President may use the authority 
        granted in section 1021(a)(3) only to cancel any 
        limited tax benefit in that law, if any, identified in 
        such separate section; or
          [(2) without a separate section described in 
        subsection (b)(2), then the President may use the 
        authority granted in section 1021(a)(3) to cancel any 
        limited tax benefit in that law that meets the 
        definition in section 1026.
  [(d) Congressional Identifications of Limited Tax Benefits.--
There shall be no judicial review of the congressional 
identification under subsections (a) and (b) of a limited tax 
benefit in a conference report.]

                   Part B--Legislative Line Item Veto

                        LINE ITEM VETO AUTHORITY

  Sec. 1011. (a) Proposed Cancellations.--Within 45 calendar 
days after the enactment of any bill or joint resolution 
providing any discretionary budget authority, item of direct 
spending, or targeted tax benefit, the President may propose, 
in the manner provided in subsection (b), the cancellation of 
any dollar amount of such discretionary budget authority, item 
of direct spending, or targeted tax benefit. If the 45 
calendar-day period expires during a period where either House 
of Congress stands adjourned sine die at the end of a Congress 
or for a period greater than 45 calendar days, the President 
may propose a cancellation under this section and transmit a 
special message under subsection (b) on the first calendar day 
of session following such a period of adjournment.
  (b) Transmittal of Special Message.--
          (1) Special message.--
                  (A) In general.--The President may transmit 
                to the Congress a special message proposing to 
                cancel any dollar amounts of discretionary 
                budget authority, items of direct spending, or 
                targeted tax benefits.
                  (B) Contents of special message.--Each 
                special message shall specify, with respect to 
                the discretionary budget authority, items of 
                direct spending proposed, or targeted tax 
                benefits to be canceled--
                          (i) the dollar amount of 
                        discretionary budget authority, the 
                        specific item of direct spending (that 
                        OMB, after consultation with CBO, 
                        estimates to increase budget authority 
                        or outlays as required by section 
                        1017(9)), or the targeted tax benefit 
                        that the President proposes be 
                        canceled;
                          (ii) any account, department, or 
                        establishment of the Government to 
                        which such discretionary budget 
                        authority is available for obligation, 
                        and the specific project or 
                        governmental functions involved;
                          (iii) the reasons why such 
                        discretionary budget authority, item of 
                        direct spending, or targeted tax 
                        benefit should be canceled;
                          (iv) to the maximum extent 
                        practicable, the estimated fiscal, 
                        economic, and budgetary effect 
                        (including the effect on outlays and 
                        receipts in each fiscal year) of the 
                        proposed cancellation;
                          (v) to the maximum extent 
                        practicable, all facts, circumstances, 
                        and considerations relating to or 
                        bearing upon the proposed cancellation 
                        and the decision to effect the proposed 
                        cancellation, and the estimated effect 
                        of the proposed cancellation upon the 
                        objects, purposes, or programs for 
                        which the discretionary budget 
                        authority, item of direct spending, or 
                        the targeted tax benefit is provided;
                          (vi) a numbered list of cancellations 
                        to be included in an approval bill 
                        that, if enacted, would cancel 
                        discretionary budget authority, items 
                        of direct spending, or targeted tax 
                        benefits proposed in that special 
                        message; and
                          (vii) if the special message is 
                        transmitted subsequent to or at the 
                        same time as another special message, a 
                        detailed explanation why the proposed 
                        cancellations are not substantially 
                        similar to any other proposed 
                        cancellation in such other message.
                  (C) Duplicative proposals prohibited.--The 
                President may not propose to cancel the same or 
                substantially similar discretionary budget 
                authority, item of direct spending, or targeted 
                tax benefit more than one time under this Act.
                  (D) Maximum number of special messages.--The 
                President may not transmit to the Congress more 
                than 5 special messages under this subsection 
                related to any bill or joint resolution 
                described in subsection (a), but may transmit 
                not more than 10 special messages for any 
                omnibus budget reconciliation or appropriation 
                measure.
          (2) Enactment of approval bill.--
                  (A) Deficit reduction.--Amounts of budget 
                authority, items of direct spending, or 
                targeted tax benefits which are canceled 
                pursuant to enactment of a bill as provided 
                under this section shall be dedicated only to 
                reducing the deficit or increasing the surplus.
                  (B) Adjustment of levels in the concurrent 
                resolution on the budget.--Not later than 5 
                days after the date of enactment of an approval 
                bill as provided under this section, the chairs 
                of the Committees on the Budget of the Senate 
                and the House of Representatives shall revise 
                allocations and aggregates and other 
                appropriate levels under the appropriate 
                concurrent resolution on the budget to reflect 
                the cancellation, and the applicable committees 
                shall report revised suballocations pursuant to 
                section 302(b), as appropriate.
                  (C) Adjustments to statutory limits.--After 
                enactment of an approval bill as provided under 
                this section, the Office of Management and 
                Budget shall revise applicable limits under the 
                Balanced Budget and Emergency Deficit Control 
                Act of 1985, as appropriate.

                 PROCEDURES FOR EXPEDITED CONSIDERATION

  Sec. 1012. (a) Expedited Consideration.--
          (1) In general.--The majority leader of each House or 
        his designee shall (by request) introduce an approval 
        bill as defined in section 1017 not later than the 
        fifth day of session of that House after the date of 
        receipt of a special message transmitted to the 
        Congress under section 1011(b).
          (2) Consideration in the house of representatives.--
                  (A) Referral and reporting.--Any committee of 
                the House of Representatives to which an 
                approval bill is referred shall report it to 
                the House without amendment not later than the 
                seventh legislative day after the date of its 
                introduction. If a committee fails to report 
                the bill within that period or the House has 
                adopted a concurrent resolution providing for 
                adjournment sine die at the end of a Congress, 
                it shall be in order to move that the House 
                discharge the committee from further 
                consideration of the bill. Such a motion shall 
                be in order only at a time designated by the 
                Speaker in the legislative schedule within two 
                legislative days after the day on which the 
                proponent announces his intention to offer the 
                motion. Such a motion shall not be in order 
                after a committee has reported an approval bill 
                with respect to that special message or after 
                the House has disposed of a motion to discharge 
                with respect to that special message. The 
                previous question shall be considered as 
                ordered on the motion to its adoption without 
                intervening motion except twenty minutes of 
                debate equally divided and controlled by the 
                proponent and an opponent. If such a motion is 
                adopted, the House shall proceed immediately to 
                consider the approval bill in accordance with 
                subparagraph (C). A motion to reconsider the 
                vote by which the motion is disposed of shall 
                not be in order.
                  (B) Proceeding to consideration.--After an 
                approval bill is reported or a committee has 
                been discharged from further consideration, or 
                the House has adopted a concurrent resolution 
                providing for adjournment sine die at the end 
                of a Congress, it shall be in order to move to 
                proceed to consider the approval bill in the 
                House. Such a motion shall be in order only at 
                a time designated by the Speaker in the 
                legislative schedule within two legislative 
                days after the day on which the proponent 
                announces his intention to offer the motion. 
                Such a motion shall not be in order after the 
                House has disposed of a motion to proceed with 
                respect to that special message. The previous 
                question shall be considered as ordered on the 
                motion to its adoption without intervening 
                motion. A motion to reconsider the vote by 
                which the motion is disposed of shall not be in 
                order.
                  (C) Consideration.--The approval bill shall 
                be considered as read. All points of order 
                against an approval bill and against its 
                consideration are waived. The previous question 
                shall be considered as ordered on an approval 
                bill to its passage without intervening motion 
                except five hours of debate equally divided and 
                controlled by the proponent and an opponent and 
                one motion to limit debate on the bill. A 
                motion to reconsider the vote on passage of the 
                bill shall not be in order.
                  (D) Senate bill.--An approval bill received 
                from the Senate shall not be referred to 
                committee.
          (3) Consideration in the senate.--
                  (A) Motion to proceed to consideration.--A 
                motion to proceed to the consideration of a 
                bill under this subsection in the Senate shall 
                not be debatable. It shall not be in order to 
                move to reconsider the vote by which the motion 
                to proceed is agreed to or disagreed to.
                  (B) Limits on debate.--Debate in the Senate 
                on a bill under this subsection, and all 
                debatable motions and appeals in connection 
                therewith (including debate pursuant to 
                subparagraph (D)), shall not exceed 10 hours, 
                equally divided and controlled in the usual 
                form.
                  (C) Appeals.--Debate in the Senate on any 
                debatable motion or appeal in connection with a 
                bill under this subsection shall be limited to 
                not more than 1 hour, to be equally divided and 
                controlled in the usual form.
                  (D) Motion to limit debate.--A motion in the 
                Senate to further limit debate on a bill under 
                this subsection is not debatable.
                  (E) Motion to recommit.--A motion to recommit 
                a bill under this subsection is not in order.
                  (F) Consideration of the house bill.--
                          (i) In general.--If the Senate has 
                        received the House companion bill to 
                        the bill introduced in the Senate prior 
                        to the vote required under paragraph 
                        (1)(C), then the Senate may consider, 
                        and the vote under paragraph (1)(C) may 
                        occur on, the House companion bill.
                          (ii) Procedure after vote on senate 
                        bill.--If the Senate votes, pursuant to 
                        paragraph (1)(C), on the bill 
                        introduced in the Senate, then 
                        immediately following that vote, or 
                        upon receipt of the House companion 
                        bill, the House bill shall be deemed to 
                        be considered, read the third time, and 
                        the vote on passage of the Senate bill 
                        shall be considered to be the vote on 
                        the bill received from the House.
  (b) Amendments Prohibited.--No amendment to, or motion to 
strike a provision from, a bill considered under this section 
shall be in order in either the Senate or the House of 
Representatives.

                    PRESIDENTIAL DEFERRAL AUTHORITY

  Sec. 1013. (a) Temporary Presidential Authority To Withhold 
Discretionary Budget Authority.--
          (1) In general.--At the same time as the President 
        transmits to the Congress a special message pursuant to 
        section 1011(b), the President may direct that any 
        dollar amount of discretionary budget authority to be 
        canceled in that special message shall not be made 
        available for obligation for a period not to exceed 45 
        calendar days from the date the President transmits the 
        special message to the Congress.
          (2) Early availability.--The President shall make any 
        dollar amount of discretionary budget authority 
        deferred pursuant to paragraph (1) available at a time 
        earlier than the time specified by the President if the 
        President determines that continuation of the deferral 
        would not further the purposes of this Act.
  (b) Temporary Presidential Authority To Suspend Direct 
Spending.--
          (1) In general.--At the same time as the President 
        transmits to the Congress a special message pursuant to 
        section 1011(b), the President may suspend the 
        implementation of any item of direct spending proposed 
        to be canceled in that special message for a period not 
        to exceed 45 calendar days from the date the President 
        transmits the special message to the Congress.
          (2) Early availability.--The President shall 
        terminate the suspension of any item of direct spending 
        at a time earlier than the time specified by the 
        President if the President determines that continuation 
        of the suspension would not further the purposes of 
        this Act.
  (c) Temporary Presidential Authority To Suspend a Targeted 
Tax Benefit.--
          (1) In general.--At the same time as the President 
        transmits to the Congress a special message pursuant to 
        section 1011(b), the President may suspend the 
        implementation of any targeted tax benefit proposed to 
        be repealed in that special message for a period not to 
        exceed 45 calendar days from the date the President 
        transmits the special message to the Congress.
          (2) Early availability.--The President shall 
        terminate the suspension of any targeted tax benefit at 
        a time earlier than the time specified by the President 
        if the President determines that continuation of the 
        suspension would not further the purposes of this Act.
  (d) Extension of 45-Day Period.--The President may transmit 
to the Congress not more than one supplemental special message 
to extend the period to suspend the implementation of any 
discretionary budget authority, item of direct spending, or 
targeted tax benefit, as applicable, by an additional 45 
calendar days. Any such supplemental message may not be 
transmitted to the Congress before the 40th day of the 45-day 
period set forth in the preceding message or later than the 
last day of such period.

                IDENTIFICATION OF TARGETED TAX BENEFITS

  Sec. 1014. (a) Statement.--The chairman of the Committee on 
Ways and Means of the House of Representatives and the chairman 
of the Committee on Finance of the Senate acting jointly 
(hereafter in this subsection referred to as the ``chairmen'') 
shall review any revenue or reconciliation bill or joint 
resolution which includes any amendment to the Internal Revenue 
Code of 1986 that is being prepared for filing by a committee 
of conference of the two Houses, and shall identify whether 
such bill or joint resolution contains any targeted tax 
benefits. The chairmen shall provide to the committee of 
conference a statement identifying any such targeted tax 
benefits or declaring that the bill or joint resolution does 
not contain any targeted tax benefits. Any such statement shall 
be made available to any Member of Congress by the chairmen 
immediately upon request.
  (b) Statement Included in Legislation.--
          (1) In general.--Notwithstanding any other rule of 
        the House of Representatives or any rule or precedent 
        of the Senate, any revenue or reconciliation bill or 
        joint resolution which includes any amendment to the 
        Internal Revenue Code of 1986 reported by a committee 
        of conference of the two Houses may include, as a 
        separate section of such bill or joint resolution, the 
        information contained in the statement of the chairmen, 
        but only in the manner set forth in paragraph (2).
          (2) Applicability.--The separate section permitted 
        under subparagraph (A) shall read as follows: ``Section 
        1021 of the Congressional Budget and Impoundment 
        Control Act of 1974 shall ________ apply to 
        ____________.'', with the blank spaces being filled in 
        with--
                  (A) in any case in which the chairmen 
                identify targeted tax benefits in the statement 
                required under subsection (a), the word 
                ``only'' in the first blank space and a list of 
                all of the specific provisions of the bill or 
                joint resolution identified by the chairmen in 
                such statement in the second blank space; or
                  (B) in any case in which the chairmen declare 
                that there are no targeted tax benefits in the 
                statement required under subsection (a), the 
                word ``not'' in the first blank space and the 
                phrase ``any provision of this Act'' in the 
                second blank space.
  (c) President's Authority.--If any revenue or reconciliation 
bill or joint resolution is signed into law--
          (1) with a separate section described in subsection 
        (b)(2), then the President may use the authority 
        granted in this section only with respect to any 
        targeted tax benefit in that law, if any, identified in 
        such separate section; or
          (2) without a separate section described in 
        subsection (b)(2), then the President may use the 
        authority granted in this section with respect to any 
        targeted tax benefit in that law.

                       TREATMENT OF CANCELLATIONS

  Sec. 1015. The cancellation of any dollar amount of 
discretionary budget authority, item of direct spending, or 
targeted tax benefit shall take effect only upon enactment of 
the applicable approval bill. If an approval bill is not 
enacted into law before the end of the applicable period under 
section 1013, then all proposed cancellations contained in that 
bill shall be null and void and any such dollar amount of 
discretionary budget authority, item of direct spending, or 
targeted tax benefit shall be effective as of the original date 
provided in the law to which the proposed cancellations 
applied.

                     REPORTS BY COMPTROLLER GENERAL

  Sec. 1016. With respect to each special message under this 
part, the Comptroller General shall issue to the Congress a 
report determining whether any discretionary budget authority 
is not made available for obligation or item of direct spending 
or targeted tax benefit continues to be suspended after the 
deferral authority set forth in section 1013 of the President 
has expired.

                              DEFINITIONS

  Sec. 1017. As used in this part:
          (1) Appropriation law.--The term ``appropriation 
        law'' means an Act referred to in section 105 of title 
        1, United States Code, including any general or special 
        appropriation Act, or any Act making supplemental, 
        deficiency, or continuing appropriations, that has been 
        signed into law pursuant to Article I, section 7, of 
        the Constitution of the United States.
          (2) Approval bill.--The term ``approval bill'' means 
        a bill or joint resolution which only approves proposed 
        cancellations of dollar amounts of discretionary budget 
        authority, items of new direct spending, or targeted 
        tax benefits in a special message transmitted by the 
        President under this part and--
                  (A) the title of which is as follows: ``A 
                bill approving the proposed cancellations 
                transmitted by the President on ____'', the 
                blank space being filled in with the date of 
                transmission of the relevant special message 
                and the public law number to which the message 
                relates;
                  (B) which does not have a preamble; and
                  (C) which provides only the following after 
                the enacting clause: ``That the Congress 
                approves of proposed cancellations ____'', the 
                blank space being filled in with a list of the 
                cancellations contained in the President's 
                special message, ``as transmitted by the 
                President in a special message on ____'', the 
                blank space being filled in with the 
                appropriate date, ``regarding ____.'', the 
                blank space being filled in with the public law 
                number to which the special message relates;
                  (D) which only includes proposed 
                cancellations that are estimated by CBO to meet 
                the definition of discretionary budgetary 
                authority or items of direct spending, or that 
                are identified as targeted tax benefits 
                pursuant to section 1014;
                  (E) if any proposed cancellation other than 
                discretionary budget authority or targeted tax 
                benefits is estimated by CBO to not meet the 
                definition of item of direct spending, then the 
                approval bill shall include at the end: ``The 
                President shall cease the suspension of the 
                implementation of the following under section 
                1013 of the Legislative Line Item Veto Act of 
                2006: ____'', the blank space being filled in 
                with the list of such proposed cancellations; 
                and
                  (F) if no CBO estimate is available, then the 
                entire list of legislative provisions proposed 
                by the President is inserted in the second 
                blank space in subparagraph (C).
          (3) Calendar day.--The term ``calendar day'' means a 
        standard 24-hour period beginning at midnight.
          (4) Cancel or cancellation.--The terms ``cancel'' or 
        ``cancellation'' means to prevent--
                  (A) budget authority from having legal force 
                or effect;
                  (B) in the case of entitlement authority, to 
                prevent the specific legal obligation of the 
                United States from having legal force or 
                effect;
                  (C) in the case of the food stamp program, to 
                prevent the specific provision of law that 
                provides such benefit from having legal force 
                or effect; or
                  (D) a targeted tax benefit from having legal 
                force or effect; and
        to make any necessary, conforming statutory change to 
        ensure that such targeted tax benefit is not 
        implemented and that any budgetary resources are 
        appropriately canceled.
          (5) CBO.--The term ``CBO'' means the Director of the 
        Congressional Budget Office.
          (6) Direct spending.--The term ``direct spending'' 
        means--
                  (A) budget authority provided by law (other 
                than an appropriation law);
                  (B) entitlement authority; and
                  (C) the food stamp program.
          (7) Dollar amount of discretionary budget 
        authority.--(A) Except as provided in subparagraph (B), 
        the term ``dollar amount of discretionary budget 
        authority'' means the entire dollar amount of budget 
        authority--
                  (i) specified in an appropriation law, or the 
                entire dollar amount of budget authority or 
                obligation limitation required to be allocated 
                by a specific proviso in an appropriation law 
                for which a specific dollar figure was not 
                included;
                  (ii) represented separately in any table, 
                chart, or explanatory text included in the 
                statement of managers or the governing 
                committee report accompanying such law;
                  (iii) required to be allocated for a specific 
                program, project, or activity in a law (other 
                than an appropriation law) that mandates the 
                expenditure of budget authority from accounts, 
                programs, projects, or activities for which 
                budget authority is provided in an 
                appropriation law;
                  (iv) represented by the product of the 
                estimated procurement cost and the total 
                quantity of items specified in an appropriation 
                law or included in the statement of managers or 
                the governing committee report accompanying 
                such law; or
                  (v) represented by the product of the 
                estimated procurement cost and the total 
                quantity of items required to be provided in a 
                law (other than an appropriation law) that 
                mandates the expenditure of budget authority 
                from accounts, programs, projects, or 
                activities for which budget authority is 
                provided in an appropriation law.
          (B) The term ``dollar amount of discretionary budget 
        authority'' does not include--
                  (i) direct spending;
                  (ii) budget authority in an appropriation law 
                which funds direct spending provided for in 
                other law;
                  (iii) any existing budget authority canceled 
                in an appropriation law; or
                  (iv) any restriction, condition, or 
                limitation in an appropriation law or the 
                accompanying statement of managers or committee 
                reports on the expenditure of budget authority 
                for an account, program, project, or activity, 
                or on activities involving such expenditure.
          (8) Item of direct spending.--The term ``item of 
        direct spending'' means any provision of law that 
        results in an increase in budget authority or outlays 
        for direct spending relative to the most recent levels 
        calculated consistent with the methodology used to 
        calculate a baseline under section 257 of the Balanced 
        Budget and Emergency Deficit Control Act of 1985 and 
        included with a budget submission under section 1105(a) 
        of title 31, United States Code, in the first year or 
        the 5-year period for which the item is effective. 
        However, such item does not include an extension or 
        reauthorization of existing direct spending, but 
        instead only refers to provisions of law that increase 
        such direct spending.
          (9) OMB.--The term ``OMB'' means the Director of the 
        Office of Management and Budget.
          (10) Omnibus reconciliation or appropriation 
        measure.--The term ``omnibus reconciliation or 
        appropriation measure'' means--
                  (A) in the case of a reconciliation bill, any 
                such bill that is reported to its House by the 
                Committee on the Budget; or
                  (B) in the case of an appropriation measure, 
                any such measure that provides appropriations 
                for programs, projects, or activities falling 
                within 2 or more section 302(b) suballocations.
          (11) Targeted tax benefit.--(A) The term ``targeted 
        tax benefit'' means any revenue-losing provision that 
        provides a Federal tax deduction, credit, exclusion, or 
        preference to only one beneficiary (determined with 
        respect to either present law or any provision of which 
        the provision is a part) under the Internal Revenue 
        Code of 1986 in any year for which the provision is in 
        effect;
          (B) for purposes of subparagraph (A)--
                  (i) all businesses and associations that are 
                members of the same controlled group of 
                corporations (as defined in section 1563(a) of 
                the Internal Revenue Code of 1986) shall be 
                treated as a single beneficiary;
                  (ii) all shareholders, partners, members, or 
                beneficiaries of a corporation, partnership, 
                association, or trust or estate, respectively, 
                shall be treated as a single beneficiary;
                  (iii) all employees of an employer shall be 
                treated as a single beneficiary;
                  (iv) all qualified plans of an employer shall 
                be treated as a single beneficiary;
                  (v) all beneficiaries of a qualified plan 
                shall be treated as a single beneficiary;
                  (vi) all contributors to a charitable 
                organization shall be treated as a single 
                beneficiary;
                  (vii) all holders of the same bond issue 
                shall be treated as a single beneficiary; and
                  (viii) if a corporation, partnership, 
                association, trust or estate is the beneficiary 
                of a provision, the shareholders of the 
                corporation, the partners of the partnership, 
                the members of the association, or the 
                beneficiaries of the trust or estate shall not 
                also be treated as beneficiaries of such 
                provision;
          (C) for the purpose of this paragraph, the term 
        ``revenue-losing provision'' means any provision that 
        is estimated to result in a reduction in Federal tax 
        revenues (determined with respect to either present law 
        or any provision of which the provision is a part) for 
        any one of the two following periods--
                  (i) the first fiscal year for which the 
                provision is effective; or
                  (ii) the period of the 5 fiscal years 
                beginning with the first fiscal year for which 
                the provision is effective; and
          (D) the terms used in this paragraph shall have the 
        same meaning as those terms have generally in the 
        Internal Revenue Code of 1986, unless otherwise 
        expressly provided.

                               EXPIRATION

  Sec. 1018. This title shall have no force or effect on or 
after October 1, 2012.

                      SUITS BY COMPTROLLER GENERAL

  Sec. [1016] 1019. If, under this title, budget authority is 
required to be made available for obligation and such budget 
authority is not made available for obligation, the Comptroller 
General is hereby expressly empowered, through attorneys of his 
own selection, to bring a civil action in the United States 
District Court for the District of Columbia to require such 
budget authority to be made available for obligation, and such 
court is hereby expressly empowered to enter in such civil 
action, against any department, agency, officer, or employee of 
the United States, any decree, judgment, or order, which may be 
necessary or appropriate to make such budget authority 
available for obligation. No civil action shall be brought by 
the Comptroller General under this section until the expiration 
of 25 calendar days of continuous session of the Congress 
following the date on which an explanatory statement by the 
Comptroller General of the circumstances giving rise to the 
action contemplated has been filed with the Speaker of the 
House of Representatives and the President of the Senate.

                 PROPOSED DEFERRALS OF BUDGET AUTHORITY

  Sec. [1013] 1020. (a) * * *

           *       *       *       *       *       *       *

  (c) Exception.--The provisions of this section do not apply 
to any budget authority proposed to be [rescinded or that is to 
be reserved] canceled as set forth in a special message 
required to be transmitted under section [1012] 1011.

                            DISSENTING VIEWS

    The Democratic Members of the Rules Committee are 
unanimously opposed to any form of line item veto. Article I, 
Section VII of the Constitution gives Congress, not the 
President, the power of the purse, and the repeated attempts of 
this Republican Congress to give the Executive Branch the power 
to blackmail the Legislative Branch. Although the sponsors of 
this amendment have attempted to address the concerns of the 
Supreme Court, in our view any line item veto legislation 
violates the checks and balances system that is the basic tenet 
of American government.
    Time and again we have witnessed this Republican Congress, 
through its various budget reform proposals, ask the President 
to save Congress from itself, and to take away the power of the 
purse before Congress spends again. But it is Members of 
Congress to whom the Founding Fathers gave this responsibility 
to, and we should not, at every possible opportunity, seek to 
abdicate from it.
    Presidents have sought to regain line item veto authority 
ever since Congress took it away from them with the 
Congressional Budget Act of 1974. Prior to the establishment of 
a Congressional budget process, Presidents often simply refused 
to spend money that was appropriated if they disagreed with its 
purpose, effectively killing a program that Congress wanted to 
fund. Congress wanted to ensure that when it worked its 
legislative will and created and funded a program, that the 
Executive Branch had a legal obligation to process the funding 
for that program.
    Under the current framework of the Budget Act, if the 
President wants to rescind appropriated funds, he can send a 
special message to Congress asking it to do so. If both the 
House and Senate agree to the rescission within 45 days, then 
it is enacted. If either House fails to do so, or simply does 
not act, then the funding must go forward.
    We recognize that from the view of the Executive Branch, 
this is an awkward and largely ineffective process. But it 
masks the extent to which this particular White House has 
exercised its power behind the scenes on various programs. The 
reason President Bush has not used his veto pen is that the 
White House has been able to obtain the necessary additions or 
deletions to bills before they reach the President's desk and 
that kind of cooperation with a compliant majority has obviated 
the need for a veto.
    While we recognize why the President would like to extend 
his reach into the Legislative Branch even further, we are 
alarmed by the extent to which Members of Congress would seek 
to accommodate such an obvious power grab. As the Chairman of 
the Appropriations Committee, Rep. Jerry Lewis said in 
testimony before our Committee back in March, giving the 
President new line item veto authority, ``would transfer a 
great deal of budgetary power to the Executive Branch. The 
President would set the agenda by deciding what rescissions to 
include in a bill, and he could structure his rescission 
messages with more of an eye towards politics instead of 
policy.''
    But why would Congress even contemplate such legislation? 
The impetus for giving the President more power over the purse 
lies in the budget deficits of the 1980's. As Congress has 
repeatedly shown by its failure to rein in budget deficits, the 
budget process is a difficult and messy business. The 
frustration of some Members has led them to believe that since 
Congress cannot be counted on to rein in federal spending by 
itself, the heavy hand of the President is needed to keep 
spending in line.
    Many of these Members cling to the hope that the President 
is some kind of nonpartisan superhero, who will use his power 
to eliminate all the ``bad'' spending out of a bill while 
leaving all the ``good'' spending untouched. They conveniently 
either forget or ignore that the President is the titular head 
of his party, and will act out of the same political 
calculations as any Member of Congress.
    As Chairman Lewis further remarked, ``for example, a 
President could propose rescissions that target the projects of 
one political party. A President would be able to structure his 
rescission messages to leverage certain political outcomes, 
such as including projects sponsored by political adversaries 
along with unpopular projects in one message, while including 
other projects with broader congressional support in another 
message.''
    Moving to a line item veto will not stop Members of 
Congress from seeking individual projects for their districts, 
will not save significant amounts of money, nor make it any 
easier to pass budget resolutions, all of which are presumably 
the desired outcomes of this process. If anything, this 
proposal could lead to an even worse budget process, as 
individual Members seek to make deals with the Administration 
to protect their earmarks in exchange for supporting rescission 
messages that hurt other Members or protect a President's 
favored program.
    Congress has been down this road before in 1996, enacting a 
Line Item Veto Act along the lines of an enhanced rescission 
authority. Enhanced rescission authority forces Congress to 
deal with rescission messages, otherwise they are automatically 
enacted. The Line Item Veto Act authorized President Clinton to 
cancel items within discretionary appropriation bills, funding 
for any new entitlement programs and some tax benefits. 
Congress had to pass a resolution of disapproval within 30 days 
which the President could veto.
    The actual implementation of the Line Item Veto Act 
reinforced the belief held by many Members of Congress that 
enhancedrescission authority would ultimately not save very 
much money. The total savings, over a 5-year period, came to less than 
$600 million. In 1998, the Supreme Court invalidated the Line Item Veto 
Act, essentially stating that such a change could only come about via 
constitutional amendment, rather than by Congressional action.
    H.R. 4890, the Legislative Line Item Veto Act, is an 
enhanced rescissions bill that would require Congress to vote 
on proposed spending rescissions. The bill would expand the 
list of bills that a President could send back from individual 
appropriations under current law, to any item of direct 
spending or any targeted tax benefit benefiting fewer than 100 
people. Additionally, any rescissions enacted under the bill go 
into a deficit reduction ``lock box'' and are not available for 
redirection into other spending categories.
    Aside from being flatly opposed to the general concept of a 
line item veto based on the separation of powers, we have two 
very specific concerns about H.R. 4890. First is our concern 
that the special rules proposed to accompany any rescissions 
bill would require the Congress to move at too fast a pace to 
consider whether or not the rescission is warranted. Under H.R. 
4890, the Majority Leader or Minority Leader would be required 
to introduce the President's rescission within five legislative 
days of receipt.
    The committee of jurisdiction would have no more than seven 
legislative days to consider the rescission, and must report it 
without amendment. If the committee failed to report the bill 
by that time, then a motion could be made to discharge the 
committee from consideration of the bill. Each message would be 
allotted five hours of debate time and presumably a final 
passage vote would be taken within 15 legislative days, or 
three weeks, after each rescission's introduction.
    While it might be feasible for the House to consider one 
rescission message under these procedures, the bill allows the 
President to send up to five messages per bill or ten messages 
per appropriations or reconciliation bill. It is very easy to 
imagine the Appropriations Committee having to deal every week 
with at least one rescissions message, if not more, which would 
leave them very little time for their regular business.
    A second problem arises from the fact that the President 
may withhold funds proposed for rescission for up to 90 days, 
even if one chamber votes to reject the rescission. Remember 
that under current law the funds would only be in dispute for 
45 days, and then would be released if Congress takes no 
action. Under H.R. 4890, the President can withhold funds for 
an initial 45 days, and then send a message to Congress 
informing them that he intends to hold the funds for an 
additional 45 days.
    If the President can withhold funds regardless of 
Congressional action for up to three months, then he can 
effectively starve programs to death, denying them the funds 
needed to hire and pay staff as well as conduct routine 
business. A major appropriation such as Amtrak, could be forced 
to slash routes and fire staff (a long standing Administration 
goal) as long as the President retains this effective power of 
the purse. It is also not clearly stated in the legislation 
that the President must release the funds immediately if a 
rescission is defeated.
    In conclusion, the whole concept of a line item veto does 
little to address the real problems our country faces in 
getting its financial house in order. The Republicans could 
take any number of concrete steps towards this goal, by 
submitting a balanced budget, reinstating the pay-as-you-go 
rule and ending the practice of hiding the true cost of the 
Iraq war behind annual emergency supplementals. But they simply 
refuse to do any of these things. Instead they suggest that a 
budget gimmick that hands over Congress' constitutional 
authority to the President will solve all of our fiscal 
worries.
    The Constitution already has veto power for the President 
built into it. If the President does not like the way the 
Congress spends money, then he has only to use his veto pen to 
demand changes. This process has served us well for over two 
hundred years, and we, the Democrats on the Rules Committee, 
see no reason to change it. To disrupt that system because some 
Members don't like the spending priorities of other Members, is 
small minded and a threat to our constitutional system.

                                   Louise M. Slaughter,
                                           Ranking Member.
                                   James McGovern.
                                   Alcee L. Hastings.
                                   Doris O. Matsui.

                                  
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