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Answers to Questions for the Record Following a Hearing by the House Committee on the Budget on the Work of the Congressional Budget Office 1 (July 29, 2015)

handle is hein.congrec/cbo2385 and id is 1 raw text is: JULY 29, 2015 Answers to Questions for the Record Following a Hearing by the House Committee on the Budget on the Work of the Congressional Budget Office On June 3, 2015, the House Committee on the Budget convened a hearing at which Keith Hall, Director of the Congressional Budget Office, testified about CBO's work. After the hearing, Chairman Price and other Members of the Committee submitted questions for the record. This document provides CBO's answers. Chairman Price Question. In CBO's scoring of H.R. 1907, The Trade Facilitation and Trade Enforcement Act of 2015, there is an assumed spending increase of $200 million from 2015-2025 as a result of increased interest payments for certain distributions under the Continued Dumping and Subsidy Offset Act (CDSOA) amendment. As the original act was written, it states that all interest should be distributed to the affected domestic industry and it was assumed until an admission by Customs and Border Patrol (CBP) in 2014 that they had been carrying out the payments as directed by law and Congressional intent. In its cost estimate of H.R. 1907 it appears that CBO relied on CBP's interpretation of the CDSOA and is treating it as a change in law rather than a clarification of existing law. By adopting CBP's interpretation of the law to determine the baseline it is in essence forcing Congress to pay for an agency's mistake in order to correct it under the current PAYGO rules. When issuing cost estimates, do you feel that CBO should use a baseline that strictly follows what the governing statute says or do you feel that CBO should also take into account how the respective agency has been carrying out the law, even if they have been applying it erroneously? Do you feel that if the baseline is determined based on an incorrect interpretation by the agency and shows an increased cost, loss in revenue, etc. it makes it more difficult for Congress to correct the error and abide by its original intent? Answer. Through its cost estimates, CBO strives to inform the Congress how enacting a piece of legislation would affect the budget in comparison with what would happen under current law. To assess the budgetary effects of proposals affecting revenues or direct spending, CBO measures projected outcomes under proposed legislation against a benchmark, the baseline. That baseline incorporates the effects of how executive branch agencies execute (or plan to execute) current laws-but CBO does not judge the validity of those agencies' actions. Therefore, when Members of Congress believe that an agency has misinterpreted the statutory language, proposed legislation to correct the perceived error could be estimated to have a cost. t

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