SGR Bill Triggers Several Rule Violations

We have described at length the fiscal irresponsibility of the Sustainable Growth Rate (SGR) reform bill (H.R. 2) working its way through Congress -- both its significant near-term and long-term costs and its exemption of the cost of the bill from pay-as-you-go (PAYGO) rules. But the PAYGO exemption is not the only way the bill violates budget rules intended to enforce fiscal discipline.

The bill also runs afoul of several points of order (POOs) under the Congressional Budget Act and Senate rules that will require 60 votes to override. The most significant budget points of order that apply to H.R. 2 as passed by the House are:

• Senate PAYGO Point of Order: The Senate provides a point of order against bills that increase deficits over the Congressional Budget Office’s (CBO’s) ten-year budget window. This rule is distinct from the statutory PAYGO rule that would automatically recoup costs that are not offset with a sequester if the bill was not exempted. By contrast, this point of order prohibits consideration of legislation that would increase the deficit unless 60 Senators vote to waive the prohibition.
• Senate Long-Term Deficit Point of Order: Although some advocates of H.R. 2 have suggested that the legislation would be fully offset or even reduce the deficit beyond the ten year window, CBO wrote in its estimate of H.R. 2 that “Taken as a whole, H.R. 2 would raise federal costs (that is, increase budget deficits) relative to current law in the second decade after enactment.” As a result, the bill would be subject to the Senate’s long-term deficit point of order, which prohibits legislation increasing deficits by more than $5 billion in any of the following four decades beyond the ten-year budget window.
• Ryan-Murray Spending Allocations Point of Order: The Ryan-Murray agreement, which set spending and revenue levels that are still in effect in the Senate, provided for spending allocations for Medicare at current law levels, with adjustments allowed for legislation that was deficit-neutral over ten years. H.R.2 would therefore be subject to a point of order for exceeding the spending allocations established by the Ryan-Murray agreement.
• Point of Order Against Amending Budget Rules: Section 306 of the Congressional Budget Act contains a point of order prohibiting consideration of legislation with provisions that are within the jurisdiction of the Budget committee if the legislation was not reported by the Budget Committee. The language in Section 525 of the bill excluding the costs of the legislation from the requirements of the Statutory Pay-As-You-Go Act falls within the jurisdiction of the Budget Committee and would therefore violate Section 306 of the CBA.

The fact that H.R. 2 triggers so many substantive budgetary points of order should serve as a good indication of how fiscally responsible the bill is, or in this case isn't.

For additional budget process resources including specific options for reform, visit our Better Budget Process Initiative home page.