The House's "Pay-As-You-Go" (PAYGO) Rule in the 110th Congress: A Brief Overview

Publication Date: January 2007

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Government

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Abstract:

On January 5, 2007, the House of Representatives adopted H.Res. 6, a measure setting forth its rules for the 110th Congress. Section 405 of the measure added a new rule, known as the House's "pay-as-you-go" (PAYGO) rule, as Clause 10 of Rule XXI. The new rule was a key element of the House Democratic leadership's legislative agenda for the beginning of the 110th Congress.

The House's PAYGO rule requires that legislation affecting direct spending or revenues must not increase the deficit (or reduce the surplus) over a six-year period, including the current year, the upcoming fiscal year, and the four following fiscal years, as well as an 11-year period (the previously cited period and the ensuing five fiscal years). The rule is enforced on the basis of estimates made by the House Budget Committee relative to the baseline projections made by the Congressional Budget Office under established procedures.

While a PAYGO rule is new in the House, the Senate has had such a rule since 1993. The Senate has modified its PAYGO rule several times over the years, and efforts are expected to be made in 2007 to make its application more stringent. At present, there are notable differences between the House and Senate PAYGO rules. In addition, efforts may be made to renew the statutory PAYGO requirement that affected legislation enacted during calendar year 1991 through the end of FY2002.

This report will be updated as developments warrant. For additional information on PAYGO rules, see CRS Report RL32835, PAYGO Rules for Budget Enforcement in the House and Senate, by Robert Keith and Bill Heniff Jr.