For a bill to reach the president, both chambers of Congress must pass the same bill. The process of reconciliation is the process by which the two chambers negotiate the differences between two similar bills that have each been passed by one of the chambers.
For example, suppose there is a crime that is punishable by imprisonment for up to 5 years, and the Senate passes a bill saying that the maximum term should be increased to 10 years, while the House of Representatives passes a bill saying it should be increased to 20 years.
There are a few options for the next steps:
- Both chambers pass the other chamber's bill; the president then gets to decide which one to sign (logically, if the president signs both, the second one overrides the first and remains in effect).
- One chamber passes the other's bill.
- Neither chamber passes the other's bill.
The first option is likely to be disfavored because Congress may not want to give the president the power to resolve the discrepancy in this way.
If one chamber tried to pursue the second option, perhaps having changed its mind about the proper penalty for the crime in question, and did so without conferring with the other chamber, there would be a danger that the other chamber would do the same, leading to the first (possibly disfavored) option.
Therefore, the members of the two chambers arrange to communicate about the two bills, usually through the mechanism of a conference committee, to decide which one to pass. Of course, they can instead decide to pursue the third option above and pass neither bill but instead proposing a new bill that "reconciles" the differences. In this example, they might decide to increase the maximum term of imprisonment to 15 years.
In that case, the new bill must be passed by both chambers before it is sent to the president to sign.
As to the origin of legislation, bills may originate in either chamber unless the bill concerns the raising of revenue. Here is section 7 of article 1 of the constitution, where all of this is set out:
1: All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.
2: Every Bill which shall have passed the House of Representatives and the Senate, shall, before it become a Law, be presented to the President of the United States; If he approve he shall sign it, but if not he shall return it, with his Objections to that House in which it shall have originated, who shall enter the Objections at large on their Journal, and proceed to reconsider it. If after such Reconsideration two thirds of that House shall agree to pass the Bill, it shall be sent, together with the Objections, to the other House, by which it shall likewise be reconsidered, and if approved by two thirds of that House, it shall become a Law. But in all such Cases the Votes of both Houses shall be determined by yeas and Nays, and the Names of the Persons voting for and against the Bill shall be entered on the Journal of each House respectively. If any Bill shall not be returned by the President within ten Days (Sundays excepted) after it shall have been presented to him, the Same shall be a Law, in like Manner as if he had signed it, unless the Congress by their Adjournment prevent its Return, in which Case it shall not be a Law.
3: Every Order, Resolution, or Vote to which the Concurrence of the Senate and House of Representatives may be necessary (except on a question of Adjournment) shall be presented to the President of the United States; and before the Same shall take Effect, shall be approved by him, or being disapproved by him, shall be repassed by two thirds of the Senate and House of Representatives, according to the Rules and Limitations prescribed in the Case of a Bill.