Introduction to the Federal Budget Process Matt Hourihan April 13, 2015 for the Catalyzing Advocacy...

Introduction to the Federal Budget Process

Matt HourihanApril 13, 2015for the Catalyzing Advocacy in Science and Engineering Workshop

AAAS R&D Budget and Policy Programhttp://www.aaas.org/program/rd-budget-and-policy-program

http://www.aaas.org/program/rd-budget-and-policy-program


The Federal Budget is Kind Of a Big Deal

“Politics is who gets what, when, and how.” - Harold Lasswell

“Budgeting is about values, and it’s about choices.” – Rep. Rosa DeLauro Every dollar in the budget has its claimants! Negotiation between competing interests (and their

proxies) in a decentralized system

Major impact for R&D and innovation: most basic research, and most university research, is federally funded

Defense Discretionary

$528 [Defense R&D]$77

Nondefense Discretionary

$495

[Nondefense R&D]$69

Social Security$938

Medicare$583

Medicaid$351

Other Mandatory$670

Net Interest$283

Composition of the Proposed FY 2016 BudgetTotal Outlays = $4.0 trillion

outlays in billions of dollars

Source: Budget of the United States Government FY 2016. Projected deficit is $474 billion. © 2015 AAAS

A Typical Federal Budget Process:Three Years, Four Phases

Phase 4: Execute the fiscal year’s budget (not shown)

Arranged by fiscal year (October to September)B

udge

t R

elea

se

Oct Nov Dec J an Feb Mar Apr May J un J ul Aug Sep Oct Nov Dec J an Feb Mar Apr May J un J ul Aug Sep

Phase 1: Planning within Agency w/ OMB and OSTP oversight

Phase 2: OMB Review

Phase 3: Congressional budget and appropriations

Bud

get

Rel

ease



Phase 2: OMB Review


The Federal Budget Cycle

Phase 1: Internal agency discussions, planning, and review OMB is present throughout

Early spring: guidance memo Science & Tech: Joint guidance memo from OMB / OSTP (midsummer)

Agencies deliver budget justifications to OMB (early fall)

Bud

get

Rel

ease



Phase 2: OMB Review



Phase 2: OMB performs multi-stage review, responds to agencies (“passbacks”) Agencies and agency heads can and do negotiate

Budget proposals are finalized in January President presents the proposed budget to Congress early

February

DOD, $71.9

HHS (NIH), $31.0

DOE, $12.5

NASA, $12.2

NSF, $6.3

USDA, $2.9

Commerce, $2.1All Other, $6.2

Total R&D by Agency, FY 2016budget authority in billions of dollars

Source: OMB R&D data, agency budget justifications, and other agency documents and data. R&D includes conduct of R&D and R&D facilities. © 2015 AAAS

Total R&D = $145.3 billion

Bud

get

Rel

ease



Phase 2: OMB Review



Phase 3: Congress receives and reacts to President’s budget, holds hearings

IN THEORY: Approves budget resolution (simple majority) Approps committees write/approve 12 appropriations bills “President proposes, Congress disposes”

The Budget Resolution

Overall spending framework

Discretionary spending figure is divvied up by appropriations committees

Budget resolution is a political document (which is why they can’t

seem to pass one?)

Reconciliation instructions? 302(b) allocations


Gov’t is working on 3 budgets at any given time. Right now: FY15 in progress FY16: Budget resolutions; approps to follow FY17: Agencies ramping up

FY 2015

FY 2016

Bud

get

Rel

ease

FY 2017

Bud

get

Rel

ease


Phase 4: Spend the Fiscal Year Budget

Phase 2: OMB Review



Phase 4: Spend the Fiscal Year Budget

Phase 2: OMB Review


Broad Qualities of the System

Decentralization

“Embeddedness”

Incrementalism

$900

$950

$1,000

$1,050

$1,100

$1,150

$1,200

Limits on Discretionary Spending Since FY 2010billions of constant 2015 dollars

Actual Base Budget Authority

Based on past budget resolutions, the Budget Control Act, and subsequent legislation. Adjusted for inflation using deflators from the FY16 budget request. © AAAS 2015

$900

$950

$1,000

$1,050

$1,100

$1,150

$1,200


Actual Base Budget Authority BCA: Original Baseline

BCA: Sequester Baseline


$900

$950

$1,000

$1,050

$1,100

$1,150

$1,200



BCA: Sequester Baseline Current Law


$900

$950

$1,000

$1,050

$1,100

$1,150

$1,200



BCA: Sequester Baseline Current Law

President's FY 2016 Budget


6.4%

-35.5%0.9%

2.2%

5.0%

8.1%

12.6%

17.8%

20.5%

23.3%

44.8%

-40% -20% 0% 20% 40% 60%

TOTAL

Justice (DHS)

Space

Health (includes NIH)

General Science (NSF, DOE SC)

Defense Activities

Environment Agencies

Transportation

Agriculture

Applied Energy Programs

Commerce (includes NIST)

FY16 R&D in the Base Budget by Functionpercent change from FY 2015, nominal dollars

Source: OMB R&D data, agency budget justifications, and agency budget documents. © 2015 AAAS

3. agency notes R&D STEM

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

Total R&D

Defense

Nondefense

ARRA Total

ARRA Defense

ARRA Nondefense

Trends in Federal R&D, FY 1977-2016in billions of constant FY 2015 dollars

Source: AAAS analyses of historical budget and appropriations data. Pre-1994 figures are NSF obligations data from the Federal Funds survey. FY 2016 is the President's request. R&D includes conduct and facilities. © 2015 AAAS

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

Federal R&D in the Budget and the EconomyOutlays as share of total, 1962 - 2016

R&D as a Share of the Federal Budget (Left Scale) R&D as a Share of GDP (Right Scale)

Source: Budget of the United States Government, FY 2016. FY 2016 is the President's request. © 2015 AAAS

0%

10%

20%

30%

40%

50%

60%

70%

80%

Composition of the Federal BudgetOutlays as share of total budget, 1962 - 2016

Payments toIndividuals

All Other

Defense (non-R&D)

Investments(research, edu,infrastructure)

Source: Budget of the United States Government, FY 2016. "Investments" include outlays for R&D, education and training, direct nondefense infrastructure, and other grants, primarily for transportation. "Payments to Individuals" are primarily entitlement programs like Medicare, Medicaid, and Social Security, but also include many other public assistance programs. © 2015 AAAS

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

R&D as a Share of GDP by Funder

Total Federal Industry Other

Source: National Science Foundation, National Patterns of R&D Resources series. © 2015 AAAS

0.0%

0.2%

0.4%

0.6%

0.8%

1.0%

1.2%

Research as a Share of GDP by Funder

Total Research Federal Research Industry Research Other

Source: National Science Foundation, National Patterns of R&D Resources series. © 2015 AAAS

$950

$1,000

$1,050

$1,100

$1,150

$1,200


BCA: Original Baseline BCA: Sequester BaselineActual Base Budget Authority Current Law (Sequester Levels)President's FY 2016 Budget House BudgetSenate Budget

Based on past budget resolutions, the Budget Control Act, and subsequent legislation. Adjusted for inflation using deflators from the FY16 budget request. Excludes war funding proposals.© AAAS 2015

$470

$490

$510

$530

$550

$570

$590

$610

Limits on Defense Spending Base billions of constant 2015 dollars


Based on past budget resolutions, the Budget Control Act, and subsequent legislation. Adjusted for inflation using deflators from FY16 request. Does not include war funding. © AAAS 2015

$400

$420

$440

$460

$480

$500

$520

$540

$560

$580

$600

Limits on Nondefense Spending Basebillions of constant 2015 dollars



For more info…

[email protected]

202-326-6607


mailto:[email protected]




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Introduction to the Federal Budget Process Matt Hourihan April 13, 2015 for the Catalyzing Advocacy...

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