Fair-Value Accounting and Budget Act
H.R. 1388, the Fair-Value Accounting and Budget Act, would amend the Congressional Budget and Impoundment Control Act of 1974 to require fair-value estimates for any CBO analysis of measures that create or modify federal loan or loan-guarantee programs. The bill also directs the CBO to include fair-value and credit-reform estimates for loan programs in its Budget and Economic Outlook where practicable, and it ties these fair-value estimates to budget enforcement by the chairs of the House and Senate Budget Committees. Beginning in 2026, the bill would require the Director of the OMB to submit an annual report to the Budget Committees detailing fair-value estimates of the cost of federal credit programs, using a definition of fair value based on a 2015 GASB publication. A clerical amendment would add Sec. 407 to the act’s table of contents. In short, the measure aims to increase transparency about the true cost of federal lending by valuing loan programs at fair value rather than solely on traditional budgetary accounting, and to use those values in budget enforcement and oversight.
Key Points
- 1Adds a new Sec. 407, “Fair-value credit estimates,” requiring fair-value estimates for any CBO calculation of measures that establish or modify federal loan or loan-guarantee programs.
- 2Requires CBO to publish baseline estimates on a fair-value and credit-reform basis in The Budget and Economic Outlook “where practicable.”
- 3Enforces budget compliance by mandating that the Chairs of the House and Senate Budget Committees use these fair-value estimates to assess compliance with budget rules.
- 4Establishes an annual reporting requirement starting in 2026: the OMB Director must submit to the Budget Committees a report on fair-value estimates of the cost of federal credit programs within 90 days after the President submits the budget.
- 5Defines fair value by reference to the Government Accounting Standards Board’s February 2015 publication “Fair Value Measurement and Application,” and makes a clerical adjustment to the act’s table of contents to add Sec. 407.