On December 12, 1985, the President signed into law the Balanced Budget and Emergency Deficit Control Act of 1985, known as the Gramm-Rudman-Hollings Act. The statute sets a maximum deficit amount for each fiscal year from 1986 through 1991. It requires across-the-board cuts in specified federal programs if the deficit exceeds the target by more than a specified sum. These cuts, called sequestrations, are made by the President on the basis of a report prepared by the Comptroller General.
The Comptroller General, after reviewing the Directors' reports, then reports his conclusions to the President. The Comptroller General must use the more pessimistic of the two sets of estimates, may make adjustments he deems appropriate, and must specify the precise reductions required on a program-by-program basis. The President is then required to issue a sequestration order that incorporates the Comptroller General's report without modification.
The Comptroller General is an officer of the Legislative Branch. He is appointed by the President, with the advice and consent of the Senate, for a 15-year term. The Comptroller General is the head of the General Accounting Office (GAO), which is an independent office in the legislative branch of the Government. He is removable not only by impeachment, but also by joint resolution of Congress at any time for permanent disability, inefficiency, neglect of duty, malfeasance, or a felony or conduct involving moral turpitude.
He is required to make such investigations and reports as shall be ordered by either House of Congress or by any committee of either House. He is to make recommendations to the Congress and to the heads of Federal agencies on legislation and other measures to improve the efficiency and economy of Government operations. Within hours of the Act's signing, Congressman Mike Synar, who had voted against it, and eleven other Members of Congress filed suit in the United States District Court for the District of Columbia seeking a declaration that the Act is unconstitutional. The National Treasury Employees Union filed a parallel action alleging injury to its members from suspended cost-of-living benefit increases.
A three-judge District Court, appointed pursuant to 2 U. S. C. § 922(a)(5), invalidated the reporting provisions. The District Court held that the role of the Comptroller General in the deficit reduction process violated the Constitution's command that Congress may not retain the power to remove an officer charged with the execution of the laws except by impeachment. The court therefore held that the reporting requirements of the Act were unconstitutional. It declared the presidential sequestration order based on those reports to be without force and permanently enjoined the Secretary of the Treasury from implementing the sequestration order. The parties appealed directly to the Supreme Court, which noted probable jurisdiction and expedited consideration.
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