House Rule XXI, Clause 10: The CUTGO Rule (CRS Report for Congress)
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| Release Date |
Revised May 9, 2023 |
| Report Number |
R41510 |
| Report Type |
Report |
| Authors |
Bill Heniff Jr., Analyst on Congress and the Legislative Process |
| Source Agency |
Congressional Research Service |
| Older Revisions |
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Summary:
The House pay-as-you-go (PAYGO) rule is generally intended to discourage or prevent Congress from taking certain legislative action that would increase the deficit. The rule requires that legislation affecting direct spending or revenues not increase the projected deficit over either a 6-year or an 11-year period. In effect, the rule requires that any legislation projected to increase direct spending or reduce revenues must be offset by equivalent amounts of direct spending cuts, revenue increases, or a combination of the two, over the two specified periods.
The House PAYGO rule applies to legislation affecting direct spending and revenues. It does not apply to discretionary spending.
This rule exempts provisions designated as an emergency from being counted in determining compliance with the PAYGO rule.
First established at the beginning of the 110th Congress, the House PAYGO rule was modified during the 111th Congress: at the beginning of the 111th Congress, as part of the opening-day rules package; and again in the second session of the 111th Congress, as part of a special rule providing for the consideration of an unrelated measure. At the beginning of the 112th Congress, it was replaced with the Cut-As-You-Go (CUTGO) rule, which focused exclusively on the mandatory spending effects of legislation, eliminating any revenue effects from the budgetary evaluation under the rule. Most recently, at the beginning of the 116th Congress, the PAYGO rule was reinstituted, covering both direct spending and revenues, with certain modifications.
The House PAYGO rule exists alongside similar PAYGO requirements in statute, but with some significant differences. The House rule (1) applies the PAYGO requirement during the consideration of legislation on the House floor, (2) applies generally to each measure individually, and (3) is enforced by a point of order on the House floor.
The Statutory PAYGO Act, in contrast, (1) applies the requirement to legislation after it has been enacted, (2) applies to the net effect of all legislation enacted during a session of Congress, and (3) is enforced by sequestrationâthe cancellation of budgetary resources provided by laws affecting direct spendingâto eliminate an increase in the deficit resulting from the enactment of legislation.
This report updates the previous version (dated November 30, 2010) with descriptions of the changes instituted by the CUTGO rule, adopted at the beginning of the 112th Congress, and the current PAYGO rule, adopted at the beginning of the 116th Congress.
