H.R. 182 — Default Prevention Act

This section directs the Secretary of the Treasury, when the statutory debt limit under 31 U.S.C. 3101(b)—currently $14.294 trillion outstanding—is reached, to (1) pay Tier I obligations as due; (2) issue obligations under 31 U.S.C. ch. 31 necessary for those payments or to be held exclusively by the Federal Old-Age and Survivors Insurance Trust Fund, Federal Disability Insurance Trust Fund, Federal Hospital Insurance Trust Fund, or Federal Supplementary Medical Insurance Trust Fund; (3) pay Tier III obligations only if all Tier II obligations can still be paid as due; (4) pay Tier IV obligations only if all Tier II and III obligations can still be paid as due; (5) pay Tier V obligations only if all Tier II, III, and IV obligations can still be paid as due; and (6) submit weekly reports to the House Ways and Means Committee and Senate Finance Committee detailing payments and unpaid amounts by tier. Obligations issued under clause (2) are excluded from the debt limit until any subsequent modification or suspension of the limit takes effect. (Thus, the framework prioritizes debt service on public-held and specified trust fund debt, Medicare payments under SSA title XVIII, Department of Defense obligations, and Veterans Affairs benefits, while delaying other obligations, executive branch travel and non-competitive service compensation, and congressional pay.) Tier I obligations include principal and interest on debt held by the public or specified Social Security and Medicare trust funds, plus Medicare payments. Tier II obligations include Department of Defense obligations and VA-administered benefits. Tier III obligations encompass all other U.S. obligations. Tier IV obligations include federal employee compensation for official time under 5 U.S.C. 7131, executive branch travel expenses (unless Tier I or II), and executive branch officer/employee compensation outside the competitive service (unless Tier I or II). Tier V obligations are congressional compensation. The section states it does not restrict the Secretary's existing prioritization authority when this section does not apply.