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National Archives

Public Papers - 1989

White House Statement on the Bipartisan Budget Agreement


In March 1989 the President, the Speaker of the House, the majority leaders of the Senate and House, the Republican leaders of the Senate and House, joined by the chairmen and ranking Republican members of the Appropriations, Ways and Means, Finance, and Budget Committees, and by the Secretary of the Treasury, the Chief of Staff to the President, and the Director of the Office of Management and Budget, concurred in a recommendation to establish a special budget negotiating group. The group was charged to explore the possibility of reaching an agreement on a budget framework for fiscal year 1990 and to report upon its progress to the President and the joint leadership of Congress. The group was composed of the chairmen and ranking Republican members of the Senate and House Budget Committees, the Majority Leader of the House, the Secretary of the Treasury, and the Director of the Office of Management and Budget. The attached agreement is the product of that negotiating group, as developed in accordance with the guidance of the leadership group.

Bipartisan Budget Agreement Between the President and the Joint Leadership of Congress

1. The elements of this agreement provide for deficit reduction amounts that, for fiscal year 1990, are currently estimated to meet the deficit target of the Balanced Budget and Emergency Deficit Control Reaffirmation Act of 1987.

2. The budget framework is approved by the President, the Speaker, and the Majority and Republican Leadership of Congress.

3. The President and the Leadership of Congress will carry out this agreement.

4. The following procedures will be utilized to implement this agreement: Congressional implementation will follow, as much as possible, the regular budget and legislative procedures. The House and Senate Budget Committees will each report a concurrent resolution on the budget for fiscal year 1990 consistent with this budget agreement. The budget resolution will contain reconciliation instructions and 302(a) allocations consistent with this budget agreement. The House and Senate Committees with jurisdiction over matters necessary to implement the agreement will be responsible for developing 302(b) allocations, legislation, and budget levels consistent with this budget agreement. Regular House and Senate procedures applicable to the consideration of budget resolutions, appropriations bills, reconciliation legislation, and other measures will apply.

5. Congress shall present the revenue portion of the reconciliation bill to the President at the same time as the spending reduction provisions of the reconciliation bill.

6. Agreed-upon fiscal year 1990 budget levels are as follows for each of

(TABLE START)the three discretionary appropriations categories:

[In billions of dollars]*




Domestic .... 7.5 .... 1.3

Defense (050)** .... 305.5 .... 299.2

International Affairs .... 19.0 .... 17.0

Footnote: *Congressional enforcement of these discretionary levels in the legislative process will be based on CBO scoring.

Footnote: **Functional total includes mandatory spending.


7. The Budget Committees, CBO, and OMB shall use the ``Scorekeeping Guidelines for the Bipartisan Budget Agreement of April 14, 1989,'' and shall work together to resolve any new scorekeeping issues that may arise.

8. Within the domestic discretionary amount, the budget resolution will provide sufficient funding for subsidized housing contract renewals (without prejudice to the form or length of such renewals).

9. Deficit reduction to be implemented in accordance with this agreement is specified in the attached ``Deficit Reduction Plan.'' For both budget scorekeeping and Gramm-Rudman-Hollings, final scoring will necessarily depend on the review of legislation by the scorekeepers, as provided in the Congressional Budget Act and Gramm-Rudman-Hollings.

10. The specific measures composing the governmental receipts figure will be determined through the regular legislative and Constitutional process. Agreements reached between the Administration and the Congressional tax-writing committees on revenue legislation reconciled pursuant to this agreement will be advanced legislatively when supported by the President of the United States.

11. Neither the Congress nor the President shall initiate supplementals except in the case of dire emergency. When the Executive Branch makes such a request, it shall be accompanied by a presidentially-transmitted budget amendment to Congress.

12. Both the President and the Congress have addressed the need for additional domestic discretionary spending priorities for the fiscal year 1990 budget. It is agreed that any funding of priorities will be within the domestic spending levels set forth in paragraph 6 of this agreement.

13. The President and the Congressional Leadership will continue to consult closely to seek opportunities for further deficit reduction and to explore policy and process changes which would reduce the deficit to meet the deficit targets of the Gramm-Rudman-Hollings law and balance the Federal budget by fiscal year 1993. In order to facilitate progress toward that objective, the bipartisan Budget Committee Leadership, the Secretary of the Treasury, and the Director of Office of Management and Budget shall continue discussions in consultation with the bipartisan leadership of the appropriate committees of the House and Senate.


Deficit Reduction Plan

Estimated Budget Levels@c3,tp9,p7,8/8,i1,s10,4.3,4.3


[Fiscal Year 1990, in billions of dollars]


@h1CBO scoring

@h1OMB scoring

Baseline Deficit .... 7.3 .... 6.6

Adjustment for estimating differences .... 19.9 .... 3.5@rn,s

Adjusted Baseline Deficit .... 127.4 .... 123.1


Revenue Measures .... 5.3 .... 5.3

IRS Compliance** .... 0.5 .... 0.5

User Fees and Offsetting Collections .... 2.7 .... 2.7@rn,s

Subtotal, revenues .... 8.5 .... 8.5


Defense (Function 050) .... 4.2 .... 1.7

International Discretionary .... 0.0 .... +0.1

Domestic Discretionary .... 0.3 .... +2.4@s2


Medicare .... 2.7 .... 2.7

Agriculture .... 1.9 .... 2.2

Veterans' Loan Sales .... 0.5 .... 0.6

Federal Pension   Postal Reform .... 1.1 .... 1.3

Other Entitlements .... 0.6 .... 0.5@rn,s

Subtotal, Entitlements/Mandatory .... 6.8 .... 7.3

Pay Offset, Retirement Contributions .... +0.4 .... +0.3

Adjustment: Postal Budgetary Treatment*** .... 1.8 .... 2.2

Debt Service .... 1.1 .... 1.1@rn,s

Subtotal, spending .... 13.8 .... 9.5

Asset Sales .... 5.7 .... 5.7@rn,s

Total Deficit Reduction Measures .... 28.0 .... 23.7@rn,s

Final Deficit .... 99.4 .... 99.4

Footnote: *Estimates as of April 14, 1989.

Footnote: **Predicated on IRS compliance funding sufficient to achieve the additional revenues specified.

Footnote: ***Predicated on postal reforms.

(TABLE END)@c3,tp9,p7,8/8,i1,s10,4.3,4.3


[Fiscal Year 1990, in billions of dollars]


@h1CBO estimates

@h1OMB estimates

Budget Authority:

Domestic Discretionary .... 7.5 .... 7.5

Defense (Function 050) .... 305.5 .... 305.5

International Discretionary .... 19.0 .... 19.0

Estimated Outlays:

Domestic Discretionary .... 181.3 .... 181.3

Defense (Function 050) .... 299.2 .... 299.2

International Discretionary .... 17.0 .... 17.0

Entitlement/Mandatory .... 556.4 .... 539.7

Net Interest .... 181.0 .... 173.2

Offsetting Retirement Receipts .... 32.8 .... 33.4

Fees, Collections, and Asset Sales .... 8.4 .... 8.4@rn,s

Total Estimated Outlays .... 1,193.8 .... 1,168.7

Estimated Receipts .... 1,074.4 .... 1,065.7

Adjustment for estimating differences .... 19.9 .... 3.5@rn,s

Deficit .... 99.4 .... 99.4


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