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This paper describes the application of the Balanced Budget and Emergency Deficit Control Act of 1985, P.L. 99-177, popularity called "Gramm-Rudman-Hollings," to programs administered by the Department of Education, particularly, it will focus on provisions establishing "emergency powers to eliminate deficits in excess of maximum deficit amounts." All of the programs within the Department's jurisdiction are subject to the automatic spending reduction provisions of this law. Two programs are subject to special treatment, the Guaranteed Student Loan and the Vocational Rehabilitation State grant program. The remaining programs are subject to a uniform percentage reduction, estimated to be 4.3 percent for FY 1986.