[Budget of the United States Government, Fiscal Year 1998]
[Page 309-319]

[[Page 309]]

 
                          1998 BUDGET PROPOSALS

                                     

                                     Table S-4.  SUMMARY OF BUDGET PROPOSALS                                    
                                            (In billions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                                                    Estimate                             Total  
                                          ------------------------------------------------------------   1998-  
                                             1997      1998      1999      2000      2001      2002       2002  
----------------------------------------------------------------------------------------------------------------
Current services deficit.................    127.7     119.5     140.1     127.6     108.5     100.8            
                                                                                                                
Programmatic changes:                                                                                           
  Revenues:                                                                                                     
    Tax relief...........................      1.4      17.9      16.2      19.6      21.9      22.8       98.4 
    Eliminate unwarranted benefits and                                                                          
     other...............................     -3.0     -10.9     -14.9     -15.9     -16.4     -17.9      -76.0 
                                          ----------------------------------------------------------------------
      Total, revenues....................     -1.6       7.0       1.4       3.7       5.5       4.9       22.4 
                                                                                                                
  Discretionary Programs:                                                                                       
    Defense..............................     -0.7      -5.3     -14.6     -14.4     -21.9     -23.2      -79.5 
    Nondefense...........................        *      -0.6      -3.3      -8.3     -18.8     -27.0      -58.0 
                                          ----------------------------------------------------------------------
      Total, discretionary programs......     -0.7      -5.9     -17.8     -22.7     -40.7     -50.2     -137.4 
                                                                                                                
   Mandatory Programs:                                                                                          
     Medicare............................  ........     -4.3     -11.4     -22.2     -27.8     -34.6     -100.2 
                                                                                                                
    Medicaid:                                                                                                   
      New initiatives....................        *       1.2       2.0       2.6       3.4       3.9       13.2 
      Savings proposals..................  ........      0.2      -1.6      -4.1      -7.3      -9.7      -22.4 
                                          ----------------------------------------------------------------------
        Net savings, Medicaid............        *       1.4       0.4      -1.4      -3.9      -5.8       -9.3 
    Spectrum auction receipts............  ........     -2.1      -1.8      -3.8      -6.3     -22.1      -36.1 
    Other mandatory programs.............      0.2       5.1       7.2       8.0       5.4      -1.4       24.3 
                                          ----------------------------------------------------------------------
      Total, mandatory programs..........      0.3       0.1      -5.6     -19.4     -32.6     -63.8     -121.2 
                                                                                                                
Total, programmatic changes..............     -2.0       1.2     -22.0     -38.4     -67.8    -102.2     -236.3 
                                                                                                                
  Debt service...........................     -0.1      -0.1      -0.7      -2.1      -4.5      -8.5      -15.9 
                                          ----------------------------------------------------------------------
Total, proposals.........................     -2.1       1.1     -22.7     -40.5     -72.3    -117.7     -252.1 
                                                                                                                
Resulting deficit/surplus (-)............    125.6     120.6     117.4      87.1      36.1     -17.0            
                                                                                                                
----------------------------------------------------------------------------------------------------------------
* $50 million or less.                                                                                          

[[Page 310]]

                     Table S-5.  CURRENT SERVICES AND PROPOSED DISCRETIONARY SPENDING LEVELS                    
                                            (In billions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                                                           Estimate                      Total, 
                                                       ------------------------------------------------   1998- 
                                                         1997    1998    1999    2000    2001    2002     2002  
----------------------------------------------------------------------------------------------------------------
Current Services Baseline:                                                                                      
  Defense Discretionary...............  BA               265.8   273.6   281.8   290.2   298.9   307.8   1,452.3
                                         OL              268.7   265.4   276.7   282.2   290.5   297.1   1,411.9
  Non-Defense Discretionary...........  BA               242.9   257.8   269.2   279.2   288.9   298.8   1,393.8
                                         OL              282.0   288.0   298.7   304.4   311.3   320.3   1,522.6
                                       -------------------------------------------------------------------------
    Total current services............  BA               508.8   531.4   551.0   569.4   587.7   606.6   2,846.1
                                         OL              550.7   553.4   575.4   586.6   601.8   617.4   2,934.5
                                                                                                                
Proposed Levels:                                                                                                
  Defense Discretionary...............  BA               263.1   266.0   269.8   275.5   282.0   289.8   1,383.1
                                         OL              268.0   260.1   262.1   267.7   268.6   273.9   1,332.4
   Non-Defense Discretionary..........  BA               242.7   264.5   265.6   267.0   267.4   270.8   1,335.3
                                         OL              282.1   287.3   295.4   296.2   292.5   293.3   1,464.7
                                       -------------------------------------------------------------------------
     Total discretionary proposals \1\  BA               505.8   530.5   535.4   542.5   549.4   560.7   2,718.4
                                         OL              550.1   547.5   557.5   563.9   561.0   567.2   2,797.1
                                                                                                                
Discretionary savings from current                                                                              
 services baseline:                                                                                             
  Defense Discretionary...............  BA                -2.8    -7.6   -11.9   -14.7   -16.9   -18.1     -69.2
                                         OL               -0.7    -5.3   -14.6   -14.4   -21.9   -23.2     -79.5
   Non-Defense Discretionary..........  BA                -0.2     6.7    -3.7   -12.1   -21.4   -28.0     -58.5
                                         OL                0.0    -0.6    -3.3    -8.3   -18.8   -27.0     -58.0
                                       -------------------------------------------------------------------------
     Total savings....................  BA                -3.0    -0.9   -15.6   -26.8   -38.3   -46.0    -127.7
                                         OL               -0.7    -5.9   -17.8   -22.7   -40.7   -50.2    -137.4
                                                                                                                
----------------------------------------------------------------------------------------------------------------
\1\ The budget proposes a five-year budget resolution by function, from 1998 through 2002, consistent with the  
  level of discretionary spending assumed in the budget, which achieves balance in 2002.                        

[[Page 311]]

                                Table S-6.  MANDATORY BUDGET PROPOSALS BY PROGRAM                               
                                            (In millions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                                                     Estimate                                   
                                            ----------------------------------------------------------   Total  
                                               1997     1998     1999      2000      2001      2002    1998-2002
----------------------------------------------------------------------------------------------------------------
Preserve Medicare..........................  .......   -4,310   -11,390   -22,150   -27,820   -34,550   -100,220
                                                                                                                
Strengthen Medicaid:                                                                                            
  Savings proposals........................  .......      205    -1,597    -4,059    -7,313    -9,666    -22,430
  New initiatives:                                                                                              
    Children's health initiatives..........  .......      344       587       934     1,362     1,530      4,757
    Welfare reform proposals...............       39      619       793       975     1,194     1,315      4,896
    Effects of other mandatory proposals...  .......      249       629       736       873     1,038      3,525
                                            --------------------------------------------------------------------
  Subtotal, new initiatives................       39    1,212     2,009     2,645     3,429     3,883     13,178
                                            --------------------------------------------------------------------
Net savings, Medicaid......................       39    1,417       412    -1,414    -3,884    -5,783     -9,252
                                                                                                                
Spectrum:                                                                                                       
  Broaden and extend non-broadcast auctions  .......   -1,400    -1,800    -3,800    -4,500    -5,600    -17,100
  Auction analog broadcast.................  .......  .......  ........  ........  ........   -14,800    -14,800
  Auction 888 phone numbers................  .......     -700  ........  ........  ........  ........       -700
  Auction a portion of the broadcast                                                                            
   channels 60-69..........................  .......  .......  ........  ........    -1,800    -1,700     -3,500
                                            --------------------------------------------------------------------
Subtotal, Spectrum.........................  .......   -2,100    -1,800    -3,800    -6,300   -22,100    -36,100
                                                                                                                
Other mandatory:                                                                                                
                                                                                                                
  Agriculture:                                                                                                  
    Amend Welfare Reform Food Stamps                                                                            
     provisions............................      362      836       659       600       405       835      3,335
    Shift fund for Rural America from 2000                                                                      
     to 1998 to correct a drafting error...  .......       25        40  ........       -30       -25         10
    Enhance the farm income ``safety net''.  .......      -21        -2        -2  ........  ........        -25
    Use certain Forest Service fees to                                                                          
     protect forest ecosystems.............  .......  .......  ........  ........  ........  ........  .........
    Have beneficiaries of marketing orders                                                                      
     pay administrative costs..............  .......      -10       -11       -11       -11       -11        -54
                                            --------------------------------------------------------------------
  Subtotal, Agriculture....................      362      830       686       587       364       799      3,266
                                                                                                                
  Commerce:                                                                                                     
    Extend surcharge on patent fees........  .......  .......      -119      -119      -119      -119       -476
                                                                                                                
  Defense:                                                                                                      
    Sell from National Defense Stockpile...  .......  .......  ........  ........  ........      -200       -200
                                                                                                                
  Education:                                                                                                    
    Student loans:                                                                                              
      Reduce payments to lenders,                                                                               
       restructure guaranty agencies and                                                                        
       recover Federal reserves, reduce                                                                         
       Federal administrative funding, and                                                                      
       reduce borrower fees................     -340   -1,050      -348      -226      -209    -1,294     -3,127
      Improve third grade literacy.........  .......       31       212       284       331       380      1,238
      Invest in school construction........  .......    1,250     1,250     1,250     1,250  ........      5,000
      Repeal the mandatory appropriation                                                                        
       under the Smith-Hughes Act of 1918..  .......       -1        -7        -7        -7        -7        -29
                                            --------------------------------------------------------------------
  Subtotal, Education......................     -340      230     1,107     1,301     1,365      -921      3,082
                                                                                                                
  Energy:                                                                                                       
    Lease excess Strategic petroleum                                                                            
     reserve storage space.................  .......  .......       -14       -37       -67       -83       -201
    Sell Weeks Island Strategic petroleum                                                                       
     reserve oil...........................  .......  .......  ........  ........  ........    -1,145     -1,145
    Sell or lease naval petroleum and oil                                                                       
     shale reserves........................  .......  .......       -10         2         2         2         -4
                                            --------------------------------------------------------------------
  Subtotal, Energy.........................  .......  .......       -24       -35       -65    -1,226     -1,350
                                                                                                                
  Health and Human Services:                                                                                    
    Set annual targets to increase                                                                              
     permanent adoptions and establish a                                                                        
     financial bonus to states for                                                                              
     increasing adoptions \1\..............  .......  .......  ........  ........  ........  ........  .........
    Permit States to spend HCFA initial                                                                         
     survey and certification fee (offset                                                                       
     under revenue)........................  .......       10        10        10        10        10         50
    Establish health insurance for the                                                                          
     families of workers in-between jobs...  .......    1,738     2,472     2,688     2,924  ........      9,822
    Establish purchasing cooperative grants  .......       25        25        25        25        25        125

[[Page 312]]

    Expand health coverage for children....  .......      750       750       750       750       750      3,750
                                            --------------------------------------------------------------------
  Subtotal, Health and Human Services......  .......    2,523     3,257     3,473     3,709       785     13,747
                                                                                                                
  Housing and Urban Development:                                                                                
    Replace FHA single family loan limits                                                                       
     with conforming limit.................  .......     -206      -226      -222      -220      -224     -1,098
    Reform FHA single family assignment....  .......     -164      -220      -182      -177      -171       -914
    Retain receipts by proposing to lower                                                                       
     administrative expenses for FHA single                                                                     
     family assignment (non-paygo).........  .......      -33       -46       -60       -74       -89       -302
    Undertake FHA portfolio reengineering:                                                                      
      Paygo................................  .......     -665  ........  ........  ........  ........       -665
      Non-paygo............................  .......      523       899       864      -888    -1,069        329
                                            --------------------------------------------------------------------
  Subtotal, Housing and Urban Development..  .......     -545       407       400    -1,359    -1,553     -2,650
                                                                                                                
  Interior:                                                                                                     
    Extend and index hardrock mining                                                                            
     holding fees on public lands..........  .......       -1       -32       -33       -34       -35       -135
    Establish hardrock mining royalties on                                                                      
     public domain lands (5 percent on net                                                                      
     smelter return).......................  .......  .......       -42       -63       -35       -35       -175
    Charge sugar assessment for Everglades                                                                      
     restoration...........................  .......      -18        -4  ........  ........  ........        -22
    Impose Hetch Hetchy Dam (CA) rental                                                                         
     payments..............................  .......       -1        -1        -1        -1        -1         -5
    Extend National Park Service fee                                                                            
     demonstration authority through 2002;                                                                      
     make all new receipts available to                                                                         
     parks \2\.............................  .......  .......  ........  ........  ........  ........  .........
                                            --------------------------------------------------------------------
  Subtotal, Interior.......................  .......      -20       -79       -97       -70       -71       -337
                                                                                                                
  Labor:                                                                                                        
    Increase Federal Unemployment Trust                                                                         
     Fund ceilings (net of administrative                                                                       
     distribution to the States)...........  .......  .......  ........      -200      -200      -200       -600
    Extend the NAFTA Transitional                                                                               
     Adjustment Assistance program.........  .......  .......        26        43        48        50        167
    Move 1 million welfare recipients into                                                                      
     jobs by 2000..........................  .......      600       975     1,000       400        25      3,000
    Reduce unemployment compensation                                                                            
     payments from increased attention to                                                                       
     integrity activities in State                                                                              
     unemployment insurance operations (non-                                                                    
     paygo)................................  .......     -118      -158      -160      -162      -165       -763
    Improve management of Workers'                                                                              
     Compensation benefits (non-paygo).....  .......        4       -20       -41       -49       -44       -150
                                            --------------------------------------------------------------------
  Subtotal, Labor..........................  .......      486       823       642        37      -334      1,654
                                                                                                                
  State:                                                                                                        
    Delay foreign service retirement COLA..  .......       -4        -4        -4        -4        -4        -20
                                                                                                                
  Transportation:                                                                                               
    Extend vessel tonnage fees.............  .......  .......       -62       -62       -62       -62       -248
    Convert Boat Safety State Grant program                                                                     
     to mandatory..........................  .......       15        27        35        35        35        147
    Transform St. Lawrence Seaway                                                                               
     Development Corporation into a                                                                             
     Performance Based Organization........  .......       11        12        13        13        13         62
    Decrease Federal-aid highways minimum                                                                       
     allocation............................  .......       15        56        35       -22       -82          2
    Sell Governor's Island.................  .......  .......  ........  ........  ........      -500       -500
    Sell Union Station air rights..........  .......  .......  ........  ........  ........       -40        -40
                                            --------------------------------------------------------------------
  Subtotal, Transportation.................  .......       41        33        21       -36      -636       -577
                                                                                                                
  Treasury:                                                                                                     
    Charge vendors for the cost of making                                                                       
     payments by paper check...............  .......      -15       -10        -5        -5        -5        -40
    Provide funding for job training                                                                            
     assistance for Puerto Rico............  .......  .......        67       167       286       424        944
                                            --------------------------------------------------------------------
  Subtotal, Treasury.......................  .......      -15        57       162       281       419        904
                                                                                                                
  Veterans:                                                                                                     
    Move medical care existing collections                                                                      
     to discretionary......................  .......      468       309       356       403       452      1,988

[[Page 313]]

    Compensation and Pensions:                                                                                  
      Extend rounding down for compensation                                                                     
       COLA................................  .......      -17       -38       -60       -76       -95       -286
      Extend income verification of pension                                                                     
       beneficiaries.......................  .......  .......       -10       -23       -36       -51       -120
      Limit pension benefits to Medicaid-                                                                       
       eligible beneficiaries in nursing                                                                        
       homes \3\...........................  .......  .......      -506      -516      -530      -541     -2,093
     Housing:                                                                                                   
      Enable VA to use Federal salary and                                                                       
       tax refund offset to collect on                                                                          
       deficiency balances for defaulted                                                                        
       loans guaranteed prior to 1990......  .......     -127  ........  ........  ........  ........       -127
      Extend three provisions that maintain                                                                     
       higher loan fees and reduce resale                                                                       
       losses on foreclosed properties.....  .......  .......      -204      -198      -197      -192       -791
      Increase fees for non-veterans in the                                                                     
       home loan program to match FHA......  .......      -25       -26       -26       -26       -27       -130
      Permanently extend loan asset sale                                                                        
       enhancement authority...............  .......       -4        -4        -5        -5        -4        -22
                                            --------------------------------------------------------------------
  Subtotal, Veterans.......................  .......      295      -479      -472      -467      -458     -1,581
                                                                                                                
  District of Columbia:                                                                                         
    Assume liabilities of the DC pension                                                                        
     system................................  .......      422       425       451       479       506      2,283
    Receive reimbursement from DC pension                                                                       
     system assets.........................  .......     -422      -425      -451      -479      -506     -2,283
                                            --------------------------------------------------------------------
  Subtotal, District of Columbia...........  .......  .......  ........  ........  ........  ........  .........
                                                                                                                
  Environmental Protection Agency:                                                                              
    Provide funding for Superfund orphan                                                                        
     shares................................  .......      142       162       184       192       200        880
                                                                                                                
  Federal Deposit Insurance Corporation:                                                                        
    Collect state bank exam fees (net of                                                                        
     premium reduction)....................  .......      -79       -82       161  ........  ........  .........
                                                                                                                
  Federal Trade Commission:                                                                                     
    Increase Hart-Scott Rodino merger                                                                           
     filing fees...........................  .......      -70       -70       -70       -70       -70       -350
                                                                                                                
  Japan-United State Friendship Commission:                                                                     
    Privatize the Japan/United State                                                                            
     Friendship Commission.................  .......       37  ........  ........  ........  ........         37
                                                                                                                
  Office of Personnel Management:                                                                               
    Delay civilian retirement COLA.........  .......     -274      -281      -289      -297      -305     -1,446
    Increase agency contributions to CSRS                                                                       
     (non-paygo)...........................  .......     -621      -604      -588      -577      -567     -2,957
                                            --------------------------------------------------------------------
  Subtotal, Office of Personnel Management.  .......     -895      -885      -877      -874      -872     -4,403
                                                                                                                
  Postal Service:                                                                                               
    Repeal Workers' Compensation                                                                                
     Reimbursement to the United States                                                                         
     Postal Service:                                                                                            
      Paygo................................  .......      -35       -33       -32       -30       -29       -159
      Non-paygo............................  .......       35         8  ........  ........  ........         43
                                            --------------------------------------------------------------------
  Subtotal, Postal Service.................  .......  .......       -25       -32       -30       -29       -116
                                                                                                                
  Railroad Retirement Board:                                                                                    
    Conform railroad retirement Social                                                                          
     Security equivalent benefits with                                                                          
     Social Security.......................  .......       31        46        46        47        47        217
                                                                                                                
  Social Security Administration:                                                                               
    Amend welfare reform provisions to                                                                          
     exempt disabled immigrants from                                                                            
     Supplemental Security Income                                                                               
     restrictions and extend eligibility                                                                        
     for refugees and asylees..............      224    1,707     1,824     2,096     1,907     2,184      9,718
    Test employment strategy for the                                                                            
     disabled:                                                                                                  
      Paygo................................  .......       -4        -4        -4        -3        -3        -18
      Non-paygo............................  .......  .......        -5         1         7        13         16
                                            --------------------------------------------------------------------
    Subtotal, test employment strategy for                                                                      
     the disabled..........................  .......       -4        -9        -3         4        10         -2
                                            --------------------------------------------------------------------
  Subtotal, Social Security Administration.      224    1,703     1,815     2,093     1,911     2,194      9,716

[[Page 314]]

  Undistributed Offsetting Receipts:                                                                            
    Effects of lower pay raise impact on                                                                        
     agency payments to the civilian                                                                            
     service retirement trust fund (non-                                                                        
     paygo)................................  .......      436       602       630       664       701      3,033
                                                                                                                
  Other proposals:                                                                                              
    Other paygo proposals..................  .......        1         1         1         1         1          5
    Other non-paygo proposals (largely                                                                          
     effects of pay raise).................  .......  .......       -10       -35       -48       -63       -156
                                            --------------------------------------------------------------------
Subtotal, other mandatory outlay proposals.      246    5,127     7,219     7,960     5,429    -1,410     24,325
                                                                                                                
Total, mandatory outlay proposals..........      285      134    -5,559   -19,404   -32,575   -63,843   -121,247
  Non-paygo................................  .......      226       666       611    -1,127    -1,283       -907
  Paygo:...................................                                                                     
    Mandatory..............................      285      -92    -6,225   -20,015   -31,448   -62,560   -120,340
    Paygo funding of discretionary spending                                                                     
     that requires adjusting the                                                                                
     discretionary caps (see below)........  .......      971     5,137     6,564     7,195     7,592     27,459
                                            --------------------------------------------------------------------
  Total, paygo proposals...................      285      879    -1,088   -13,451   -24,253   -54,968    -92,881
                                                                                                                
Paygo funding of discretionary spending                                                                         
 funded by governmental receipts that                                                                           
 requires adjusting the discretionary caps:                                                                     
  HHS:.....................................                                                                     
    Increase spending from Food and Drug                                                                        
     Administration user fees..............  .......      237       252       267       282       297      1,335
                                                                                                                
  Labor:                                                                                                        
    Increase spending from alien labor                                                                          
     certification fee.....................  .......       25        50        50        50        50        225
                                                                                                                
  State:                                                                                                        
    Increase spending from State                                                                                
     immigration, passport and other fees..  .......      506       566       589       595       595      2,851
                                                                                                                
  Transportation:                                                                                               
    Increase spending from aviation fees...  .......      198     4,263     5,653     6,263     6,645     23,022
                                                                                                                
  National Transportation and Safety Board:                                                                     
    Increase spending from user fees.......  .......        5         6         5         5         5         26
                                            --------------------------------------------------------------------
Total, paygo funding of discretionary                                                                           
 spending funded by governmental receipts                                                                       
 that requires adjusting the discretionary                                                                      
 caps......................................  .......      971     5,137     6,564     7,195     7,592     27,459
                                                                                                                
                 MEMORANDUM                                                                                     
                                                                                                                
Welfare Reform proposals included above:                                                                        
  Medicaid.................................       39      619       793       975     1,194     1,315      4,896
  Agriculture: Food Stamps.................      362      836       659       600       405       835      3,335
  Social Security Administration:                                                                               
   Supplementary Security Income...........      224    1,707     1,824     2,096     1,907     2,184      9,718
                                            --------------------------------------------------------------------
  Total, Welfare Reform proposals..........      625    3,162     3,276     3,671     3,506     4,334     17,949
                                                                                                                
----------------------------------------------------------------------------------------------------------------
Note: All savings are paygo, unless otherwise stated.                                                           
\1\ The budget includes a proposal to pay incentive payments to States that increase adoptions from the foster  
  care system. The budget assumes incentive payments of up to $108 million over 1999-2002 for these payments. It
  is anticipated that reduced foster care payments would offset the outlays from any incentives paid.           
                                                                                                                
\2\ Also affects Bureau of Land Management, Fish and Wildlife Services, and Forest Service. Current proposal    
  would make available all new receipts to the collections agency (no net savings).                             
                                                                                                                
\3\ Net Government savings is $300 million less annually because of offsetting costs to the Medicaid program.   

[[Page 315]]

                                   Table S-7.  EFFECT OF PROPOSALS ON RECEIPTS                                  
                                            (In millions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                                                     Estimate                             Total 
                                           ------------------------------------------------------------   1998- 
                                              1997      1998      1999      2000      2001      2002      2002  
----------------------------------------------------------------------------------------------------------------

Provide tax relief and extend expiring                                                                          
 provisions:                                                                                                    
  Middle Class Bill of Rights:                                                                                  
    Provide tax credit for dependent                                                                            
     children.............................      -718    -9,889    -6,806    -8,552   -10,387   -10,369   -46,003
    Expand Individual Retirement Accounts                                                                       
     (IRAs)...............................  ........    -1,454      -477      -753    -1,157    -1,674    -5,515
    Provide tax incentive for education                                                                         
     and training.........................       -84    -4,044    -6,199    -7,848    -8,632    -9,386   -36,109
                                           ---------------------------------------------------------------------
      Subtotal, Middle Class Bill of                                                                            
       Rights.............................      -802   -15,387   -13,482   -17,153   -20,176   -21,429   -87,627
                                                                                                                
    Provide targeted welfare-to-work tax                                                                        
     credit...............................  ........       -68      -137      -163      -122       -61      -551
    Provide capital gains exclusion on                                                                          
     sale of principal residence..........       -71      -288      -301      -284      -268      -249    -1,390
    Establish DC tax incentive program....  ........       -24       -46       -56       -66       -68      -260
    Provide estate tax relief for small                                                                         
     business.............................  ........        -1      -164      -166      -174      -182      -687
    Provide tax incentives for distressed                                                                       
     areas................................       -40      -424      -500      -502      -469      -410    -2,305
    Provide tax credit for investment in                                                                        
     community development financial                                                                            
     institutions (CDFI)..................  ........        -2        -5        -7        -9       -11       -34
    Toll statute of limitations for                                                                             
     incapacitated taxpayers..............  ........  ........  ........  ........        -6       -49       -55
    Allow Foreign Sales Corporation (FSC)                                                                       
     benefits for computer software                                                                             
     licenses.............................       -10       -90      -100      -110      -120      -130      -550
    Extend exclusion for employer-provided                                                                      
     educational assistance...............       -82      -645      -670      -758      -247  ........    -2,320
    Extend R&E tax credit.................      -430      -787      -540      -234      -111       -41    -1,713
    Extend orphan drug tax credit.........        -8       -19       -12        -3        -3        -1       -38
    Extend work opportunity tax credit....  ........      -128      -157       -93       -31       -10      -419
    Extend deduction for contributions of                                                                       
     appreciated stock....................  ........       -34       -38  ........  ........  ........       -72
    Extend and modify Puerto Rico economic-                                                                     
     activity tax credit..................  ........       -27       -68       -91      -109      -122      -417
                                           ---------------------------------------------------------------------
      Subtotal, Provide tax relief and                                                                          
       extend expiring provisions.........    -1,443   -17,924   -16,220   -19,620   -21,911   -22,763   -98,438
                                                                                                                
Eliminate unwarranted benefits and adopt                                                                        
 other revenue measures:                                                                                        
  Deny interest deduction on certain debt                                                                       
   instruments............................        15        52       103       158       213       271       797
  Defer original issue discount deduction                                                                       
   on convertible debt....................  ........        12        21        32        43        52       160
  Limit dividends-received deduction                                                                            
   (DRD):                                                                                                       
    Reduce DRD to 50 percent..............  ........       255       339       354       370       387     1,705
    Eliminate DRD for certain stock.......  ........        13        23        36        49        63       184
    Modify holding period for DRD.........  ........        36        26        27        28        29       146
    Interaction...........................  ........        -8        -8        -8        -9        -9       -42
  Extend pro-rata disallowance of tax-                                                                          
   exempt interest to all corporations....  ........        16        31        45        56        65       213
  Require average-cost basis for stocks,                                                                        
   securities, etc........................  ........       638       601       594       589       589     3,011
  Require recognition of gain on certain                                                                        
   stocks, indebtedness and partnership                                                                         
   interests..............................  ........        38        61        65        71        76       311
  Change the treatment of gains and losses                                                                      
   on extinguishment......................  ........         6         6         6         7         7        32
  Require reasonable payment assumptions                                                                        
   for interest accruals on certain debt                                                                        
   instruments............................  ........        79       234       288       289       207     1,097
  Require gain recognition for certain                                                                          
   extraordinary dividends................       401       586         6        11        17        23       643
  Repeal percentage depletion for non-fuel                                                                      
   minerals mined on Federal and formerly                                                                       
   Federal lands..........................         8        89        92        94        96        97       468
  Modify loss carryback and carryforward                                                                        
   rules..................................         5       144       617       798       690       629     2,878
  Treat certain preferred stock as                                                                              
   ``boot''...............................        25       145       163       172       180       144       804
  Repeal tax free conversions of large C                                                                        
   corporations to S corporations.........  ........         1        12        26        35        45       119

[[Page 316]]

  Require gain recognition in certain                                                                           
   distributions of controlled corporation                                                                      
   stock..................................        10        62        67        71        73        76       349
  Reform treatment of certain stock                                                                             
   transfers..............................        31       114       127       137       146       155       679
  Expand subpart F provisions regarding                                                                         
   certain income.........................  ........        19        34        39        44        48       184
  Modify taxation of captive ``insurance''                                                                      
   companies..............................  ........        26        18        13         7         4        68
  Modify foreign tax credit carryback and                                                                       
   carryforward rules.....................  ........        50       263       340       293       275     1,221
  Replace sales source rules with activity-                                                                     
   based rules............................  ........       891     1,474     1,555     1,750     1,855     7,525
  Modify rules relating to foreign oil and                                                                      
   gas extraction income..................  ........         4        59        97       104       107       371
  Phase out preferential tax deferral for                                                                       
   certain large farm corporations                                                                              
   required to use accrual accounting.....        28       136       121       124       124       124       629
  Initiate Inventory reform:                                                                                    
    Repeal lower of cost or market method.        20       213       351       372       378       179     1,493
    Repeal components of cost method......        39       130       178       187       196       204       895
  Expand requirement that involuntarily                                                                         
   converted property be replaced with                                                                          
   property acquired from an unrelated                                                                          
   party..................................  ........         2         4         5         8        10        29
  Place further restrictions on like-kind                                                                       
   exchanges involving personal property..         2         7        12        17        23        29        88
  Require registration of certain                                                                               
   corporate tax shelters.................  ........         1         3         2         2         2        10
  Require reporting of payments to                                                                              
   corporations rendering service to                                                                            
   Federal agencies.......................  ........         1         7        21        45        77       151
  Increase penalties for failure to file                                                                        
   correct information returns............  ........         3        16        21        24        26        90
  Tighten substantial understatement                                                                            
   penalty for large corporations.........  ........        24        40        41        35        29       169
  Repeal exemption for withholding on                                                                           
   gambling winnings from bingo and keno                                                                        
   in excess of $5,000....................         1        17         4         1         1         1        24
  Require tax reporting for payments to                                                                         
   attorneys..............................  ........  ........         3         3         2         2        10
  Extend oil spill excise tax \1\.........        26       222       224       228       230       231     1,135
  Impose excise taxes on kerosene as                                                                            
   diesel fuel \1\........................         4        35        33        31        30        30       159
  Limit extension of tax credit for                                                                             
   producing fuel from a nonconventional                                                                        
   source.................................        14        64        96        99       101       102       462
  Extend and modify FUTA provisions:                                                                            
    Extend FUTA surtax \1\................  ........  ........       862     1,218     1,295     1,333     4,708
    Accelerate deposit of unemployment                                                                          
     insurance taxes......................  ........  ........  ........  ........  ........     1,320     1,320
                                           ---------------------------------------------------------------------
      Subtotal, Eliminate unwarranted                                                                           
       benefits...........................       629     4,123     6,323     7,320     7,635     8,894    34,295
                                                                                                                
Other provisions that affect receipts:                                                                          
  Extend corporate environmental tax \2\..  ........     1,095       732       767       785       803     4,182
  Extend Superfund excise taxes \1\.......       110       661       675       687       697       708     3,428
  Extend LUST excise taxes \1\............        16       120       126       128       131       134       639
  Extend aviation excise taxes/new user                                                                         
   fee \1\<SUP>, \3\...........................     2,291     5,017     6,678     6,647     6,824     7,007    32,173
  Extend GSP and modify other trade                                                                             
   provisions \1\.........................  ........      -665      -509      -648      -732      -771    -3,325
  Assess fees for examination of FDIC-                                                                          
   insured banks and bank holding                                                                               
   companies (receipt effect) \1\.........  ........        72        75        78        82        86       393
  Modify method of reimbursing Federal                                                                          
   Reserve Banks (receipt effect).........  ........       122       125       129       132       136       644
  Establish IRS continuous levy...........  ........       402       398       364       269       212     1,645
  Assess fees for NTSB aviation accident                                                                        
   investigation activities \1\...........  ........         5         5         5         5         5        25
  Establish alien labor certification fee                                                                       
   \1\....................................  ........        19        37        37        37        37       167
  Exempt Federal vaccine purchases from                                                                         
   the payment of vaccine excise taxes \1\  ........       -72  ........  ........  ........  ........       -72
  Extend and increase FDA user fees \1\...  ........       178       189       200       211       223     1,001
  Initiate HCFA Medicare survey and                                                                             
   certification fee \1\..................  ........         7         7         7         7         7        35

[[Page 317]]

  Increase employee contributions to CSRS                                                                       
   and FERS...............................  ........  ........       214       423       571       621     1,829
  Adjust Federal pay raise (receipt                                                                             
   effect)................................  ........      -164      -216      -213      -212      -212    -1,017
                                           ---------------------------------------------------------------------
    Subtotal, Other provisions............     2,417     6,797     8,536     8,611     8,807     8,996    41,747
                                           ---------------------------------------------------------------------
    Subtotal, Eliminate unwarranted                                                                             
     benefits and other provisions that                                                                         
     affect receipts......................     3,046    10,920    14,859    15,931    16,442    17,890    76,042
                                                                                                                
                                           =====================================================================
    Total effect of proposals \1\.........     1,603    -7,004    -1,361    -3,689    -5,469    -4,873   -22,396
                                                                                                                
      (Paygo proposals) \1\...............     1,603    -6,890    -1,270    -3,605    -5,389    -4,797   -21,951
                                                                                                                
      (Non-Paygo proposals) \1\...........  ........      -114       -91       -84       -80       -76      -445
----------------------------------------------------------------------------------------------------------------
\1\ Net of income offsets.                                                                                      
                                                                                                                
\2\ Net of deductibility for income tax purposes.                                                               
                                                                                                                
\3\ The aviation excise taxes are proposed to be reinstated effective April 1, 1997. In addition, the           
  Administration proposes that aviation excise taxes be repealed effective October 1, 1998 and replaced with    
  cost-based user fees.                                                                                         

[[Page 318]]

                          Table S-8.  SUMMARY OF SUPPLEMENTAL AND RESCISSION PROPOSALS                          
                                            (In millions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                         Budget Authority                           Outlays                     
                                    ----------------------------------------------------------------------------
                                       1997     1998    1999     1997     1998     1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
Supplemental Increases in                                                                                       
 Discretionary Programs:                                                                                        
  Department of Agriculture........       106  ......  ......       91        9  .......  ......  ......  ......
  Department of Defense............     2,098  ......  ......    1,572      404       71  ......  ......  ......
  Department of Housing and Urban                                                                               
   Development.....................        30  ......  ......  .......        3       21       6  ......  ......
  Department of Labor..............  ........  ......  ......      -45       30  .......      15  ......  ......
  Department of State..............  ........  ......     921  .......  .......      921  ......  ......  ......
  Department of Transportation.....  ........  ......  ......       47      168       52      15       9       8
  Other Independent Agencies.......        20  ......  ......       18        2  .......  ......  ......  ......
                                    ----------------------------------------------------------------------------
  Subtotal, Supplemental Increases                                                                              
   in Discretionary Programs.......     2,254  ......     921    1,683      616    1,065      36       9       8
                                                                                                                
Decreases in Discretionary                                                                                      
 Programs:                                                                                                      
  Department of Agriculture........       -50  ......  ......      -28      -18       -3  ......  ......  ......
  Department of Defense............    -4,872  ......  ......   -2,314   -1,333     -825  ......  ......  ......
  Corps of Engineers--Civil........       -50  ......  ......      -30      -20  .......  ......  ......  ......
  Department of Housing and Urban                                                                               
   Development.....................      -280  ......  ......      -16      -33      -47     -40     -37     -33
                                    ----------------------------------------------------------------------------
  Subtotal, Decreases in                                                                                        
   Discretionary Programs..........    -5,252  ......  ......   -2,388   -1,404     -875     -40     -37     -33
                                                                                                                
Supplemental Increases in Mandatory                                                                             
 Programs:                                                                                                      
  Department of Transportation.....         4  ......  ......        4  .......  .......  ......  ......  ......
  Department of Veterans Affairs...       753  ......  ......      753  .......  .......  ......  ......  ......
                                    ----------------------------------------------------------------------------
  Subtotal, Supplemental Increases                                                                              
   in Mandatory Programs...........       757  ......  ......      757  .......  .......  ......  ......  ......
                                    ============================================================================
    Total, All Proposals...........    -2,241  ......     921       52     -788      190      -4     -28     -25
----------------------------------------------------------------------------------------------------------------

[[Page 319]]

                       Table S-9.  DISCRETIONARY PROPOSALS BY APPROPRIATIONS SUBCOMMITTEE                       
                                            (In millions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                     1996 Enacted        1997 Estimate       1998 Proposed      Change: 1997 to 
                                 ------------------------------------------------------------        1998       
   Appropriations Subcommittee                                                               -------------------
                                     BA      Outlays     BA      Outlays     BA      Outlays     BA      Outlays
----------------------------------------------------------------------------------------------------------------
                                                                                                                
  General Purpose Discretionary                                                                                 
                                                                                                                
Agriculture and Rural                                                                                           
 Development....................    13,776    13,672    13,644    14,480    13,839    13,889       195      -591
Commerce, Justice, State, and                                                                                   
 the Judiciary..................    23,876    23,962    25,191    25,232    26,362    26,455     1,171     1,223
National Security...............   242,556   243,254   238,967   242,835   243,290   238,581     4,323    -4,254
District of Columbia............       712       712       719       719       770       532        51      -187
Energy and Water Development....    19,624    21,603    19,919    21,275    23,000    19,677     3,081    -1,598
Foreign Operations..............    12,331    12,600    12,244    13,194    16,846    13,165     4,602       -29
Interior and Related Agencies...    12,808    13,294    12,751    13,628    13,107    13,520       356      -108
Labor, HHS, and Education.......    67,183    67,895    74,346    73,114    79,602    75,641     5,256     2,527
Legislative.....................     2,121     2,161     2,169     2,247     2,386     2,373       217       126
Military Construction...........    11,150    10,511     9,984    10,920     8,383     9,521     1,601    -1,399
Transportation and Related                                                                                      
 Agengies.......................    12,573    35,916    12,735    35,505    12,416    35,729      -319       224
Treasury, Postal Service and                                                                                    
 General Government.............    11,444    11,594    12,054    12,213    13,057    12,520     1,003       307
Veterans Affairs, HUD, and                                                                                      
 Independent Agencies...........    68,211    75,939    64,280    80,457    71,921    80,575     7,641       118
                                 -------------------------------------------------------------------------------
  Subtotal, General Purpose                                                                                     
   Discretionary................   498,366   533,114   499,004   545,820   524,980   542,178    25,976    -3,642
                                                                                                                
  Violent Crime Reduction Trust                                                                                 
          Fund (VCRTF)                                                                                          
                                                                                                                
Commerce, Justice, State, and                                                                                   
 the Judiciary..................     3,956     1,175     4,525     2,508     5,238     4,705       713     2,197
Labor, HHS, and Education.......        53        26        61        47       144        76        83        29
Treasury, Postal Service, and                                                                                   
 General Government.............        77        55        84        81       118       102        34        21
                                 -------------------------------------------------------------------------------
  Subtotal, VCRTF...............     4,086     1,256     4,670     2,636     5,500     4,883       830     2,247
                                 ===============================================================================
    Total, Discretionary........   502,452   534,370   503,674   548,456   530,479   547,061    26,805    -1,395
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Memorandum: Amounts Excluded                                                                                    
 From Budget Resolution                                                                                         
 Allocations And Not Included                                                                                   
 Above                                                                                                          
                                                                                                                
National Security...............  ........  ........     2,078     1,567  ........       399  ........  ........
Transportation and Related                                                                                      
 Agencies.......................  ........  ........        20        18  ........         2  ........  ........
                                 -------------------------------------------------------------------------------
  Total, Supplemental Requests                                                                                  
   for Emergency Funding........  ........  ........     2,098     1,585  ........       401  ........  ........
----------------------------------------------------------------------------------------------------------------

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