Fair-Value Accounting and Budget Act

What it does

• •Requires the Congressional Budget Office (CBO) to provide fair-value estimates for any legislation that establishes or modifies federal loan or loan guarantee programs.
• •Mandates that the CBO include fair-value and credit reform basis estimates of loan programs in its annual 'Budget and Economic Outlook' publication.
• •Directs the Office of Management and Budget (OMB) to submit annual reports on fair-value estimates of federal credit program costs, beginning in 2026 within 90 days of the President's budget submission.
• •Establishes that fair-value estimates will be used by budget committee chairs to determine compliance with budget enforcement requirements.

Why it matters

• •Fair-value accounting aims to provide more accurate cost assessments of federal loan programs by accounting for market risk and opportunity costs, rather than using current credit reform methodology.
• •The text states this change applies to budget compliance determinations, potentially affecting how lawmakers evaluate the fiscal impact of credit-related legislation.
• •Annual OMB reporting creates ongoing documentation of federal credit program costs under this alternative accounting approach.

Who is affected

• •The Congressional Budget Office and Office of Management and Budget, which must prepare and report fair-value estimates.
• •Congress, specifically the House and Senate Budget Committees, which will use these estimates for budget enforcement decisions.
• •Federal agencies administering loan and loan guarantee programs subject to budget assessment under the new methodology.

What happens next

The bill has been referred to the House Committee on the Budget and Committee on Rules for consideration of relevant provisions.