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Tales from the Sausage Factory: How the Federal Government Gets a Budget

Tales from the Sausage Factory: How the Federal Government Gets a Budget . Neile L. Miller Director Office of Budget U.S. Department of Energy. Fiscal Year is Oct 1-Sept 30 Process takes 18 Months before money is available to spend During that time 3 budgets are in play. As of April, 2008:

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Tales from the Sausage Factory: How the Federal Government Gets a Budget

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  1. Tales from the Sausage Factory:How the Federal Government Gets a Budget Neile L. Miller Director Office of Budget U.S. Department of Energy

  2. Fiscal Year is Oct 1-Sept 30 Process takes 18 Months before money is available to spend During that time 3 budgets are in play. As of April, 2008: FY-08 Budget is being spent FY-09 budget is on the Hill FY-10 Budget is being formulated in the agencies Budget Calendar ~April Outlines of the Administration budget for the coming year are in place. April - Sept Agencies prepare budget requests. Sept Agencies submit budgets to the Office of Management and Budget (OMB). Sept-Nov OMB analysis of agency submissions Nov-Dec Negotiations – Agencies and OMB. Dec-Jan Final decisions by Administration. Feb President submits Budget to Congress. Feb – July Congressional Hearings /Committee Markups. June - July Appropriations committees report bills. Aug - Sept Appropriations bills passed by Congress. Oct 1- Sep 30 The new fiscal year (FY). Agencies spend the amounts appropriated.

  3. Projections: Inflation Unemployment Economic Growth Size of Deficit Administration Initiatives, e.g. Social Security Budget Calendar ~April Outlines of the Administration budget for the coming year are in place.

  4. Agency Targets from OMB Bottom up agency Process Competition for funding within target New Projects depending on room within target Budget Calendar ~April Outlines of the Administration budget for the coming year are in place. April - Sept Agencies prepare budget requests.

  5. Budget within target Over-Target items that agency is willing to argue for (or see cut if OMB does not increase target) Budget Calendar ~April Outlines of the Administration budget for the coming year are in place. April - Sept Agencies prepare budget requests. Sept Agencies submit budgets to the Office of Management and Budget (OMB).

  6. Discussions with agencies Director’s Review Input from other offices in Executive Office of Pres. Passback Budget Calendar ~April Outlines of the Administration budget for the coming year are in place. April - Sept Agencies prepare budget requests. Sept Agencies submit budgets to the Office of Management and Budget (OMB). Sept-Nov OMB analysis of agency submissions

  7. Appeals to: OMB Assoc Dirs. OMB Director President Budget Calendar ~April Outlines of the Administration budget for the coming year are in place. April - Sept Agencies prepare budget requests. Sept Agencies submit budgets to the Office of Management and Budget (OMB). Sept-Nov OMB analysis of agency submissions Nov-Dec Negotiations – Agencies and OMB.

  8. Budget Calendar ~April Outlines of the Administration budget for the coming year are in place. April - Sept Agencies prepare budget requests. Sept Agencies submit budgets to the Office of Management and Budget (OMB). Sept-Nov OMB analysis of agency submissions Nov-Dec Negotiations – Agencies and OMB. Dec-Jan Final decisions by Administration. Feb President submits Budget to Congress. Feb – July Congressional Hearings /Committee Markups. June - July Appropriations committees report bills. Aug - Sept Appropriations bills passed by Congress. Oct 1- Sep 30 The new fiscal year (FY). Agencies spend the amounts appropriated.

  9. Congressional Budget Process But first a word about the Committees

  10. Authorizing Committees Senate Committees (16) Agriculture, Nutrition, and Forestry Appropriations Armed Services Banking, Housing, and Urban Affairs Budget Commerce, Science, and Transportation Energy and Natural Resources Environment and Public Works Finance Foreign Relations Health, Education, Labor, and Pensions Homeland Security and Governmental Affairs Judiciary Rules and Administration Small Business and Entrepreneurship Veterans Affairs Every program, e.g. Weapons, Yucca Mtn, was created by an authorizing committee. After being created, they get a budget each year from the appropriations committee. Special, Select, and OtherIndian Affairs Select Committee on Ethics Select Committee on Intelligence Special Committee on Aging JointJoint Committee on Printing Joint Committee on Taxation Joint Committee on the Library Joint Economic Committee

  11. House Committees (20) Committee on Agriculture Committee on Appropriations Committee on Armed Services Committee on the Budget Committee on Education and the Workforce Committee on Energy and Commerce Committee on Financial Services Committee on Government Reform Committee on Homeland Security Committee on House Administration Committee on International Relations Committee on the Judiciary Committee on Resources Committee on Rules Committee on Science Committee on Small Business Committee on Standards of Official Conduct Committee on Transportation and Infrastructure Committee on Veterans' Affairs Committee on Ways and Means Special, Select, and Other House Permanent Select Committee on Intelligence Joint Joint Committee on Printing Joint Committee on Taxation Joint Committee on the Library Joint Economic Committee

  12. Programs in place already. Funding provided for those programs. Funding levels changed each year About 40% of budget

  13. Programs themselves changed by legislation. Spending dictated by eligibility (entitlements – Soc. Sec, Medicare) Formulas (highway, grants) About 60% of budget) Congressional Budget Process

  14. Spending levels can differ: From those in the Request Between House and Senate Congressional Budget Process

  15. Congressional Budget Process

  16. Congressional Budget Process

  17. Note that one agency may have to deal with more than one subcommittee. Highlights show which committees deal with Defense Department

  18. Congressional Budget Process

  19. Congressional Budget Process Hearings Feb-July Bills Reported & passed June-July Conference Committees July-Aug Final Bills passed Aug-Sept Spending starts Oct 1

  20. Status of the DOE Appropriations Bills – Oct 1, 2006 Ref. http://thomas.loc.gov/home/approp/app07.html

  21. Federal Debt and Deficit • Data for FY 2005: • Outlays were $2.47 T • Deficit was $0.32 T • Debt was $7.9 T • Which means that: • The Government borrowed 13% of the money spent was borrowed. • Government debt was 3.2 times amount spent. U.S. Budget for 2007: Charts 23.1, 16.2

  22. FY 2005 FEDERAL BUDGET OUTLAYS Total = $2.472 Trillion Net Interest on Debt 7% Defense Discretionary 20% Social Security, Medicare, Medicaid, Welfare, Other Non-Defense Mandatory Discretionary 54% 19.% • Includes: • Homeland Security • Veterans Affairs • International Affairs Ref: US Budget 2007 Table 20-2

  23. Federal Debt and Deficit • Surplus in 4 of last 25 years.

  24. Federal Debt and Deficit U.S. Budget for 2007: Charts 12.1, 16.2

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