ORIGINAL ASSIGNMENT: Give a BRIEF, general overview of the Annual Budget Cycle, from the president’s budget through budget implementation. Brief means to provide only a couple sentences on each major part of the cycle.
What are your top three areas of concern that you think should be addressed in the federal budget and why? Link to a resource to give your more information about the typical budget cycle.https://www.cbpp.org/research/policy-basics-introduction-to-the-federal-budget-proce
STUDENT 1: Philip
There are four phases to the Annual Budget Cycle. They are agency planning, budget review, the appropriations cycle and the execution of the budget. Agencies begin to formulate their budgets 18 to 24 months prior to the year they wish to spend their funding. This allows for the then current year appropriations to factor into the POM cycle and allow for resets (market cost updates, fuel surcharges, factory production lead times, etc.) to be calculated accurately. Once a budget is planned, it is sent to higher for review and policy inputs. A command may have directives which force out discretionary spending. Next, these budgets are sent to Congress, where they are rolled into a total agency (DOD/DOJ/DHS, etc) budget for review. Provided all markups and concessions are agreed upon, the President signs it into law prior to October 1st.
My three areas of concern in the federal budget:
1. It needs to be realistic. How can you justify to the American people that you are spending $4T of their money and then need to raise taxes for federal employees’ pay increases? Most citizens have never met a FED but they see their roads and bridges everyday. How about a true review of what we are providing for and cutting out the unnecessary and excess?
2. It needs to be properly funded. How does one provided subsidized healthcare or fund two wars, without a tax increase to offset it? The FED deficit in 2001 was $5.7T, in 2009 it was $10.6T and today it is $21.8T. These are incomprehensible numbers growing by the second. It’s not to blame on just one party/administration. When public trust expects you to balance the government’s checkbook and get/stay out of debt, how can you expect the government to lead by example for their own lives?
3. It is not a piggy bank for corporations. True, the government contracts out much of it’s work. However, there are redundancies wherein contractors are performing inherently governmental work. If you return the work load the the FED employee, the contractor loses the employee, loses the bidding, loses the lobbying. These losses will fund an additional FED employee (including healthcare and pension).
The Federal government created the PPBE method, otherwise known as the planning, programming, budgeting, and execution phases of the RAP (DAU, 2018). While other agencies focus more heavily on annual constraints, the DoD must ensure a long-term analysis and Program Objectives Memorandum (POM)) which covers a 5-year span. The budget estimates, however, must be far more accurate and hence the required Budget Estimate Submission (BES) will only address the first year of the 5-year plan.
Agencies typically deliver suggestions and estimates to their corresponding Service Headquarters months before the agency/headquarters submits their POM and BES to the Office of the Secretary of Defense (OSD). This allows the numerous headquarters of each military branch, Federal agency, Congress, and the OSD to work together in submitting their documents in a timely manner (See Figure 1 for the administrative timeline). Once the PPBE process is complete, the DoD submits a budget to Congress for review. Once congress provides oversight the president then signs the appropriations legislation and authorizes the Office of the Under Secretary of Defense (OUSD) to distribute the funds as designated in the fiscal plan (Keating, 1998, P. 20).
The final component comes in the form of authorized spending. Obligations are made by agencies, funds are pulled from specific pools of money and committed, and then the execution of the funds occurs when legal commitments are paid for through the awarding of contracts.
Interesting to note:
There was a FY 1986 National Defense Authorization Act (NDAA) (Section 1405) which mandated DoD to submit biennial budgets. Then finally The FY 2008 NDAA (Section 1001) repealed that portion of FY 1986 NDAA (Section 1405). Subsequently, DoD reverted to the annual programming and budgeting cycle effective with the FY 2010 budget request (DAU, 2018). There was rumor that DoD would use it again, but I do not think so. I believe it makes those personnel directly involved with the budget held responsible for truer estimates, creating more stress to calculate future years, and overall unrealistic conditions to justify costs associated with bona fide needs and budgetary allocations for 2 straight years. Biennial budgeting would not fix the broken congressional budget process. The adoption will do nothing to address the underlying political issues between the parties and the numerous back-and-forth dialogue that can take place between the senate, house, and president. However, if we do switch over to biennial again, it may provide a sense of security as the off year would allow for more oversight. Certain departments may need to spend more supplemental funds because of human error and market fluctuations, but the overall cost benefit of the off-year portion may outweigh those outlier costs. That off-year would also allow political entities to focus efforts elsewhere besides for strictly budgetary concerns and threats of a government shut down.
DAU. (2018, February 14). Planning, Programming, Budgeting & Execution Process (PPBE). Retrieved from Defense Acquisition University: https://www.dau.mil/acquipedia/Pages/ArticleDetail…
Keating, P. J., & Paulk, D. A. (1998). Examination of the flying hour program (FHP) budgeting process and an analysis of Commander Naval Air Forces Pacific (CNAP) FHP funding. Unpublished master’s thesis, Naval Postgraduate School, Monterey, CA.
NCSL. (2018, February 14). FY2017 State Budget Status. Retrieved from National Conference State Legislatures: http://www.ncsl.org/research/fiscal-policy/fy-2017…