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1 (October 22, 2002)

handle is hein.crs/crsmthabbim0001 and id is 1 raw text is: Order Code RS21316 Updated October 22, 2002 CRS Report for Congress Received through the CRS Web Budget Enforcement Procedures: Senate Pay-As-You-Go (PAYGO) Rule Bill Heniff Jr. Analyst in American National Government Government and Finance Division Summary The Senate pay-as-you-go, or PAYGO, rule generally requires that any legislation increasing direct spending or reducing revenues be offset. A motion to waive the rule requires an affirmative vote of three-fifths of the membership (i.e., 60 Senators if no seats are vacant). The rule expired on September 30, 2002. On October 16, however, the Senate agreed to restore and extend the PAYGO point of order through April 15, 2003. Beginning in 1993, six points of order under the PAYGO rule have been raised against an entire bill or an amendment. Of these six points of order, four were sustained and two fell upon the adoption of a waiver motion. This report will be updated as developments warrant. Introduction The Senate pay-as-you-go, or PAYGO, rule generally requires direct spending and revenue legislation to be budget neutral over a 10-year period. Any increase in direct spending or reduction in revenues resulting from such legislation must be offset by an equivalent amount of direct spending cuts, tax increases, or a combination of the two. Without an offset, such legislation would require the approval of at least 60 Senators to waive the rule and be considered on the Senate floor. Direct spending is provided in substantive law, and funds such mandatory items as Medicare, unemployment compensation, and retirement programs. It is distinguished from discretionary spending, which is controlled through the annual appropriations process. The Senate PAYGO rule does not apply to direct spending or revenues generated under existing law; it applies only to legislation considered by the Senate. Consequently, direct spending may increase and revenues may decline in any fiscal year due to factors beyond the control of the PAYGO rule. Congressional Research Service + The Library of Congress