THURSDAY, FEBRUARY 16, 1995. CONGRESSIONAL BUDGET OFFICE WITNESSES ROBERT D. REISCHAUER, DIRECTOR JAMES L. BLUM, DEPUTY DIRECTOR POLLY E. HODGES, BUDGET AND FINANCE OFFICER Mr. PACKARD. Technically, ladies and gentlemen, we should have a second Member here and I think we will shortly, but I would prefer not to wait. We are on a rather tight time line this afternoon. Members of the House are trying to get away and we should be completing our work on the Floor in about an hour, maybe a little over. So we would like to get started if we could. We are extremely grateful to have Mr. Robert Reischauer. I think this will be his final appearance officially before the committee, but very, very grateful to have you at least this time. We recognize your term expired in January, but you have agreed to remain and see us through this process, at least until another is appointed in your place. We are also very grateful to have your Deputy, Mr. James Blum. We appreciate your attendance, and Ms. Polly Hodges also. Members will be coming and going, I believe, in the next hour or so, so we will recognize them as they arrive if we need to. This is a hearing on the Congressional Budget Office's budget request. The CBO is requesting $23.2 million and a staff ceiling of 219 full-time equivalent positions for the fiscal year 1996, a level budget compared to the one that we enacted for the 1995 fiscal year. There is a reduction of two FTEs below the 1995 appropriations. I have read your statement and it is not necessary, I think, for you to read it at this time. Mr. REISCHAUER. Don't worry. Mr. PACKARD. It is a very comprehensive and thorough statement for which we are grateful. But we would appreciate you, in any way you wish, giving us an overview or orally giving us a statement. The statement that is printed will be entered into the record. So with that, I will turn the time over to you, Mr. Reischauer, and let you proceed as you wish. Mr. REISCHAUER. Thank you very much, Mr. Chairman. All three of us are glad to have the opportunity to present the Congressional Budget Office's fiscal year 1996 budget request to the subcommittee. This will be the last time that I testify before any committee or subcommittee of the Congress as the Director. I have testified somewhere between 120 and 150 times over the past six years, and I have enjoyed every single one of those times. Mr. PACKARD. We very much appreciate the long service that you have given to the agency. Mr. REISCHAUER. As you mentioned, I will submit the prepared statement for the record and just summarize briefly what our request was and how we arrived at that request. CBO'S ORIGINAL BUDGET SUBMISSION When we put our budget together last fall-our original submission-we were very cognizant of the pressures that you would be under, given the very tight nature of the discretionary spending caps and the desire of many Members of Congress to make substantial deficit reductions. We decided to set an example, to come forward with a budget that represented a nominal freeze, maintaining our level at $23,188,000. That was not an easy task. We went through the entire agency. We scrubbed everything we could, tightened every screw that might have been loose, hammered down every nail that might have been poking up a bit, and thought that we could probably do it and that you would therefore be relieved that, unlike many other agencies that you will be dealing with, we were not coming in for an increase. CBO'S REVISED BUDGET SUBMISSION The new Congress, of course, came into existence in early January and began moving extremely rapidly on its priorities and passed the Unfunded Mandate Reform Act, both in the House and the Senate (H.R. 5 and S. 1). This legislation put important new requirements on the Congressional Budget Office-requirements that, quite frankly, are impossible to fulfill with our existing staff or with the request for resources that we had originally submitted to this subcommittee and to the Office of Management and Budget. And therefore, the Congressional Budget Office is requesting an additional $2.6 million and 25 full-time-equivalent employees to fulfill the new responsibilities that are embodied in the legislation on unfunded mandates. That brings our revised budget request to $25,788,000, which is an 11 percent increase, and as I said before, would raise the number of full-time-equivalent employees from 219 to 244. The need for these resources was reflected in the legislation and had been since the very early days of the efforts to pass unfunded mandate legislation. Last year, several bills were working their way through the Senate and the House, and they authorized $6.3 million, roughly, for additional resources for the Congressional Budget Office. H.R. 5 and S. 1 both allowed for an authorization of $4.5 million per year to fulfill these functions. CBO's request for this function is only $2.6 million. It is not the full $4.5 million that was envisioned by those pieces of legislation. We have arrived at this number through a lot of soul-searching and difficult guesstimation. I do not want to say that this has been a scientific process, because we do not know how big a burden this is going to be. What we have asked for is what I believe to be the absolute bare minimum to respond to the requirements that will be placed on us. This request for an additional $2.6 million assumes that our existing staff will absorb a substantial portion of the workload implied by the unfunded mandate bill. It does not mean that there was fat in the existing staff; what it means is that we will redirect resources away from things we have been doing for the Congress toward these unfunded mandate activities, in the belief that unfunded mandates and private-sector issues are where the priorities and the interests of the Congress now lie. I would not be surprised at all if my successor came in next year and said that the request the Congressional Budget Office put forward last year was insufficient to do what the Congress has demanded of it, that with a year's worth of experience, we now understand that this work cannot be done with this rather limited effort. I say that just as a warning, and that is what just might happen. This is, I would sum up, a very tight budget. This agency has served the Congress very well, and I believe that under the new leadership chosen by the Congress, it will continue to serve the Congress very well. But keep in mind that with the possible balanced budget amendment or even if that should fail in the Senate, the clear desire of the Majority and many in the Minority to reduce the deficit substantially-added pressures are going to be placed on the Congressional Budget Office. With the reduction in Budget Committee staffs, both the House and the Senate staffs, more of the load will shift to the Congressional Budget Office. With the plan of the Speaker to require that every budget resolution that is offered on the House floor meet a balanced budget requirement by the year 2002 as determined by CBO, there will be more pressure, more demands on the Congressional Budget Office. And I think it would be wise if the office received the resources it needs so that important Congressional decisions are not held up because CBO is unable to provide the information needed for the budget process-and the unfunded mandate process to go forward. And on that note, let me stop, and I will be happy to answer any questions that you or Mr. Miller or any other member of the committee that may come in might ask. [The information follows:] CBO Statement of Congressional Budget Office on CBO's Appropriation Request for Fiscal Year 1996 before the Subcommittee on Legislative Committee on Appropriations U.S. House of Representatives February 16, 1995 CONGRESSIONAL BUDGET OFFICE SECOND AND D STREETS, S.W. WASHINGTON, D.C. 20515 |