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THE U.S. BUDGET Alan Lopatin , Legislative Counsel

THE U.S. BUDGET Alan Lopatin , Legislative Counsel. Congressional Budget Process. Enacted to bring order to decision making Establishes timetable for orderly decisionmaking Establishes rules and procedures for fiscal legislation

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THE U.S. BUDGET Alan Lopatin , Legislative Counsel

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  1. THE U.S. BUDGET Alan Lopatin, Legislative Counsel

  2. .

  3. Congressional Budget Process • Enacted to bring order to decision making • Establishes timetable for orderly decisionmaking • Establishes rules and procedures for fiscal legislation • Intended to give Congress a level playing field with the Executive Branch

  4. Tools Of The Trade • Congress adopts a “Budget Resolution” or a blueprint for spending and revenues for the year ahead. • Congress spends the rest of the year (and maybe more!) building the structure laid out.

  5. Spending Side Two principle ways of spending money: Discretionary appropriations (defense, domestic, international . . . Salaries, grants, contracts Entitlements (Social Security, Medicare, Guaranteed Student Loans, CSRS/FERS)

  6. Income Side Revenues (income taxes, payroll taxes, etc.) Receipts (fees, asset sales, etc.)

  7. ?* Late February Budget Timetable President submits Fiscal Year 2010 Budget Principles L?J Mid March Committees submit “views and estimates” on FY 2010 Budget

  8. FÀEBy April 15Congress completes action (conference report) on the Congressional BUDGET RESOLUTION for fiscal years 2010 through 2020, including, if necessary, RECONCILIATION instructions to committees of jurisdiction. (Deadline met only in 1976, 1977 and 1994.)

  9. F"After April 15Congressional committees respond to RECONCILIATION instructions by recommending changes in laws within their jurisdictions which would achieve savings in entitlement/direct spending programs (federal retirement) or increase receipts through tax law changes. RECONCILIATION legislation enjoys special treatment for congressional action.

  10. F$E May 15 Appropriations bills may be considered in the House of Representatives even in the absence of agreement on a conference report on the BUDGET RESOLUTION for the upcoming fiscal year. F$ By June 10 House Appropriations Committee finishes reporting all 12 regular appropriations bills for fiscal year 2010.

  11. F"ByJune 15Congress completes action on RECONCILIATION legislation, making changes in entitlement laws, direct spending programs, and tax laws in order to bring congressional action into line with the BUDGET RESOLUTION blueprint. (Congress has never completes RECONCILIATION legislation by this date; earliest was July 31, 1981.)

  12. F$ABy June 30 House completes action on all 13 regular appropriations bills for fiscal year 2010.F$AJuly/AugustSenate completes action on appropriations bills. Conferences commence between the House and Senate to resolve differences in appropriations legislation.

  13. F$ÀSeptember 30House and Senate complete action on conference report on appropriations bills for fiscal year 2010 – send to the President.

  14. ?ÀFOctober 1Fiscal Year 2010 begins.

  15. Influences • The ECONOMY • The size of the deficit • The cost of the war • Cost of Health Care/Reform • Electoral politics

  16. NARFE Budget-Related Agenda • First Do No Harm • Premium Conversion ($) • Government Pension Offset ($) • Windfall Elimination Provision ($) • Stimulus

  17. Goal • No Budget Resolution adverse assumptions on civil service/postal service/retirement or benefits • No reconciliation directive in the FY 2010 Budget Resolution • Include sufficient specific resources for the NARFE Legislative Agenda

  18. FEDERAL CIVIL SERVICE RETIREMENT AND HEALTH BENEFITS REMAIN UNSCATHED IN OBAMA BUDGET, BUT NARFE RAISES CONCERNS ABOUT PAY DISPARITY AND MEDICARE MEANS TESTING PROPOSALS

  19. Concord

  20. ECONOMIC RECOVERY Provide Nearly 60 Million Retired and disabled Americans an immediate $250 Through Temporarily increasing Benefits. These vulnerable populations are the first ones to feel an economic downturn. Through the recovery Act, we will spend almost $15 billion to provide nearly 60 million retired Americans and Americans with disabilities an immediate $250 through temporarily increasing Social Security, Supplemental Security Income, and Veterans benefits. * President’s FY 2010 Budget (p. 18)

  21. “ENTITLEMENT REFORM” [Entitlement Commission, Automatic Pilot]

  22. 550-12—Discretionary and Mandatory Adopt a Voucher Plan for the Federal Employees Health Benefits Program

  23. 550-13—Mandatory Base Federal Retirees' Health Benefits on Length of Service

  24. 600-4—Discretionary Restructure the Government's Matching Contributions to the Thrift Savings Plan

  25. 650-1—Mandatory Base Social Security Cost-of-Living Adjustments on an Alternative Measure of Inflation

  26. 650-5—Mandatory Raise the Normal Retirement Age in Social Security

  27. NARFE’s Legislative Program for the 111th: • NARFE supports the repeal or reform of the Social Security GPO and WEP.

  28. Government Pension Offset (GPO): Affects a government worker with a pension where SS taxes were NOT paid (for CSRS retirees eligible to retire December 1982 or later). The SS spousal benefit (from spouse’s work under SS) will be offset by 2/3 of the annuitant’s own annuity—this reduces or eliminates the SS benefit.

  29. Who is affected by the GPO? • Approximately 401,000 individuals, representing less than 1% of SS beneficiaries. • 42% are widows/ers • 75% are women • 85% lose their entire Social Security benefit

  30. Windfall Elimination Provision (WEP) • Affects a government worker with a pension where SS taxes were NOT paid but who also earned SS in other jobs. (for CSRS or FERS retirees with CSRS-component eligible to retire January 1986 or later). • The SS benefit is reduced by a computation formula. It can result in a loss of 60% of the individual’s SS benefit; for 2007 it is a maximum monthly loss of $340 ($4080/yr).

  31. Who is Affected by the WEP? • Approximately 971,000 individuals, about 2.4% of SS beneficiaries • 65% are men • 3.5% of these individuals had incomes below the poverty line.

  32. GPO-WEP Legislation in the 110th: • Repeal legislation: • H.R. 235 • Rep. Howard Berman (D-CA) and Rep. Howard ‘Buck’ McKeon (R-CA) • 206 cosponsors • S. 484 • Sen. Dianne Feinstein (D-CA) • 14 cosponsors • * as of March 6, 2009

  33. SS Actuarial Figures Over Ten Years • Eliminating the GPO: $40 Billion • Eliminating the WEP: $40 Billion Total Cost of Repeal: $80 Billion

  34. The odds are with us only if we play our hand wisely

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