Planning, Programming, Budgeting, and Execution

Planning, Programming, Budgeting, and Execution
PPBE Process SECTION I. : PPBE Process ADMINISTRATIVE DATA All Courses Including This Lesson Course Number Version Course Title 01 Planning Programming Budget & Execution Course (PPBE) Task(s) Task Number Individual Taught (*) or Academic Hours The academic hours required to teach this lesson are as follows: Resident Hours/Methods Academic Hours/Method 0.1 hrs Introduction/Conference Discussion 3.3 hrs Conference Discussion 0.1 hrs Summary 3.5 hrs Total Time Test Lesson Number Testing (to include test review) Hours -0 hrs Lesson Number - Prerequisite Lesson(s) Lesson Number Lesson Title Identify the stages of the PPBE process within the DoD and DA Security Level: Unclassified Requirements: There are no clearance or access requirements for the lesson. Foreign Disclosure Restrictions FD5. This product/publication has been reviewed by the product developers in coordination with the Fort Jackson Soldier Support Institute foreign disclosure authority. This product is releasable to students from all requesting foreign countries without restrictions. Instructor Requirements Must meet physical qualifications IAW AR Materials Required Instructor Materials: Lesson plan slides and PPBE Summary Sheet Student Materials: Manpower Management Summary Sheet Classroom, Training Area, and Range Requirements General Purpose Classroom - 25 Seats Instructional Guidance Note: Before presenting this lesson, instructors must thoroughly prepare by studying this lesson and identified reference material. Also, provide the students with situational awareness of the Operational Environment (OE) variables and actors. Proponent Lesson Plan Approvals Name Rank Position Date Harris, Norman CTR Writer/Developer xx-xxx-xxxx Bonig, Reid GS-12 Chief - FMITD xx-xxx-xxxx Davis, Bobby LTC FM-DOT xx-xxx-xxxx Zellars, Eric COL Commandant xx-xxx-xxxx Motivator: Anyone here ever do any financial planning for the future? 1) What’s the first thing you do when planning? Set Goals! - Maybe you would like a big house, some land, or to travel the world These goals help you decide how much you need to put away. 2) Later on you may realize you don’t have enough money for all your plans (can’t afford the big house and the yearly trips). - So you have to cut some plans or projects because a lack of funds. In order to save this money up you have monthly or yearly budgets (putting your money aside). Later on you actually spend the money within your budget doing your goals and plans. Loosely - Planning is 1st, Programming is 2nd , Budgeting is 3rd, and Execution is 4th. Planning, Programming, Budgeting, and Execution 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Terminal Learning Objective
Action: Conditions: Standard: Identify the stages of the PPBE process within the DoD and DA. Given a summary sheet containing AR 1-1, DFAS-IN Manual FY, DA PAM 5-3, and slides. With 80% accuracy: Determine the stages, players, and concepts of the Planning, Programming, Budgeting, and Execution (PPBE) process within DoD and DA. NOTE: State the TLO Safety Requirements: Everyone is responsible for safety. A thorough risk assessment must be completed prior to every mission or operation. Risk Assessment Level: Low Environmental Considerations: NOTE: It is the responsibility of all Soldiers and DA civilians to protect the environment from damage. Environmental protection is not just the law but the right thing to do. It is a continual process and starts with deliberate planning. Always be alert to ways to protect our environment during training and missions. In doing so you will contribute to the sustainment of our training resources while protecting people and the environment from harmful effects. Evaluation: Students will take a comprehensive test at the end of Week 1. Students must score 80% or higher and International officers must score 70% or higher. Instructional Lead-in: Through PPBE, the Army develops a strategy (a plan), a program, and a budget to develop combat equipment, doctrine, and combat forces for the next war. This lesson explores the purpose and background of PPBE. It also identifies the key terms, and players in this complex but critical defense system. There are four phases of PPBE, this lesson will explore each phase - Planning, Programming, Budgeting, and Execution to illustrate its importance to Army resource managers. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Management System Should:
A Military Resource Management System Should: Identify and prioritize resource requirements Allocate resources to requirements with highest priorities Link resources to goals and objectives Justify military goals and priorities Tie resource decisions to the performance achieved Provide a continuous flow of information Why do we have to have a RM system? - Simply put, because we have Limited funds availability. Since the 1960s the PPBE has controlled the Army process for resourcing units, installations, and activities. Senior leaders and financial managers at all levels are active participants in the PPBE process. The Army requires a responsive resource management system for three primary reasons: -First, it is a crucial management tool in the primary and ongoing mission to provide the best possible mix of forces, equipment, and support to the Unified Combatant Commanders (UCCs). It addresses the challenge of getting the right resources in the right place at the right time. A sound resource management system allows Army components to determine goals, develop plans, and evaluate progress. The Office of the Secretary of Defense (OSD) and Headquarters, Department of the Army (HQDA) provide guidance and integration oversight in this effort. -Second, the DoD and the Army are accountable to Congress and the public for good stewardship of public funds and compliance with Congressional guidance. This responsibility can only be accomplished through a resource management system that not only accounts for all expenditures but also tracks results against objectives and expectations. -Third, a sound resource management system helps determine priorities given limited resources. Funding, time, equipment, and people, are all limited resources. Senior leadership must determine which requirements go unresourced - the art of distributing shortages. Congress and the President struggle to balance defense needs with other priorities. The Secretary of Defense (SECDEF) prioritizes each component's requirements against the National Military Strategy (NMS). Finally, the Army requires a sound plan to fund readiness by distributing scarce resources. - With the exception of non-appropriated funds and a few small revenue sources, all DoD activities are funded by Congress. In short, Congress considers requests for funding from DoD and the Services as presented in the President’s Budget and provides funding in Congressional Appropriations. However, there are many competing demand for public funds and resources are always constrained. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Allocating Army Resources
Total Outlay $ Total Discretionary $ Non- defense Defense Discretionary Mandatory Defense -wide MILCON AFH Other The federal government collects taxes, makes expenditures (outlays) and incurs debt. Federal outlays fall into two categories, non-discretionary and discretionary spending - Mandatory spending covers expenses the government must pay. Examples are entitlements (i.e., Medicare, Social Security, and veterans‘ pensions) and interest on the national debt. - Discretionary spending covers other needs for which there is some funding choice. Examples include education, transportation, and national defense. Congress views discretionary spending in two categories, defense and non-defense. Since national security is the first priority of the federal government, defense spending consumes a large portion of available discretionary dollars. However, other needs compete for the limited discretionary funds. In addition, the growing cost of entitlements (mandatory spending) works to shrink the overall size of the discretionary pool. Navy/ Marines RDA MILPAY Army O&M Air Force Total Army $ Total Defense $ 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

FINANCIAL MANAGEMENT SCHOOL
Flow of Funds CONGRESS APPROPRIATES APPROPRIATION ACTS TREASURY CREATES BANK ACCOUNTS OMB DoD APPORTIONS ISSUE WARRANTS All starts with Congress – Hopefully by 1 Oct the President signs the budget and it becomes law Left Side Congress Appropriates to OMB (Office Of Management and Budget) OMB Receives and then Apportions to all Gov agencies to include DOD -At OSD it comes into the USD(c) office OSD – Does a Release of Programs – this is when you actually receive your funds (USD (c) to ASA FM&C Right Side Congress has the Treasury Department create a bank account for each Appropriation The Treasury then issues Warrants – Separate notification to all agencies that they can draw funds on the Treasury – The Army’s notification comes into the ABO (Army Budget Office) HQDA then allocates to Army Commands (ACOMs), Army Service Component Commands (ASCCs), and Direct Reporting Units (DRUs) and HQDA Agencies. The ACOMS, ASCCs, DRUs and HQDA Agencies then distribute down through an allotment or an allowance to subordinate organizations ALLOCATES/ RELEASE of PROGRAMS HQDA Commands / Agencies ALLOCATES 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

DoD Budget Process History
1940 1950 1960 1970 1980 1990 2000 Single Year Budgets Military Expansion PPBS - FYDP PPBE "The cost of one modern bomber is this: a modern school in more than 30 cites. It is two electric power plants...It is two, fine, fully equipped hospitals. It is some 50 miles of concrete highway. We pay for a single fighter with half a million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people.” President Dwight D. Eisenhower, 1953 -The reality of limited resources adds a significant challenge to the primary mission of providing the best possible mix of forces, equipment, and support to the UCCs. Achieving the best possible mix includes overcoming the limitations of fiscal constraints. To provide the best force structure, maintain accountability, and distribute shortages, the SECDEF instituted a DoD-wide resource management system in 1962 known as PPBS. -In the early part of the 20th Century, the federal budget process emphasized the control of expenditures. Each Service essentially submitted its own single year budget to Congress annually. Budget estimates were primarily based on previous expenses. Within the military, the Army and the Navy competed to obtain an equal share compared to the other Service. No significant or meaningful structure existed to classify costs by function or objective. Resource management across the military was duplicative, inequitable, and limited to consideration of a single budget year. -During the 1940s and 1950s, the enormous military expansion for WWII, the creation of the DoD, and the rise of Cold War threats prompted new debates within Congress, the administration, and the military over how much to spend on defense and how funds should be allocated. President Eisenhower echoed the concerns of many about limited resources, rising defense costs, and the tradeoff against other national needs. Consensus grew that the DoD needed an improved resourcing system to address new threats and the pace of political and technological change. -Upon becoming the SECDEF in 1961, Robert S. McNamara saw the need for a plan and program to control change over several years (i.e., multi-year programming). He sought an integrated process to create a true defense budget and address the absence of an accounting system to capture all force development and weapon systems costs. Secretary McNamara's efforts complimented the trend in Congress to shift power from the Services to the SECDEF and encourage joint operations. Most importantly, the Secretary McNamara determined to strengthen the connection between national security objectives and the defense budget. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Future-Years Defense Program Structure
1940 1950 1960 1970 1980 1990 2000 Organizations Army OSD, Defense Agencies, Joint Staff, etc. Navy Air Force Other Military Personnel Operations & Maintenance Strategic Forces General-Purpose Forces Intelligence & Communications Airlift & Sealift National Guard & Reserve Forces Research & Development Central Supply & Maintenance Training, Medical, & Other Administration Support of Other Nations Special Operations Major Force Programs Note: Refer students to page 9 of the PPBE summary sheet -Future Years Defense Program: Secretary McNamara's management approach resulted in each Service documenting their multi-year programming of resources in a single document termed the Five Year Defense Program, now called the Future Years Defense Program (FYDP). Once established, the OSD determined that all changes to the FYDP had to be approved by the SECDEF. This move retained significant Service input but centralized control at OSD. -The FYDP provides a multi-year focus built around ten defense mission areas called major force programs (MFPs). The original FYDP included 11 MFPs: Strategic forces; general purpose forces; command, control and communications; airlift and sealift; national guard and reserve forces; special forces; research and development; central supply and maintenance; training, medical, other general personnel activities; administration and associated activities; intelligence space and support of other nations. The vertical columns in the FYDP Structure Chart represent the Services and Defense Agencies - traditional budget divisions. However, for the OSD the FYDP focus remained on the MFPs. -Most importantly, the FYDP projected resource requirements for each MFP five years into the future – the current budget year (BY) plus the four following years. Creating a multi-year focus allowed senior leaders the time to make decisions and funding based upon projected needs and the defense strategy. -Many PPBS veterans consider the FYDP's focus on major force programs and mission related outputs as one of PPBS greatest contributions. The creation of the FYDP provided a vehicle by which the SECDEF could make program decisions covering multiple years but tie them to the annual budget preparation. -Although succeeding SECDEFs have implemented several changes, at its core PPBS is essentially the same system today. The major difference has been the degree of influence exerted by key players. Changes in the system since Secretary McNamara introduced PPBS in 1961 have focused primarily on the overall degree of control between the Services and OSD. Finally, growing participation by defense senior leadership, including the UCC commanders, in the PPBS/PPBE process has been a consistent trend. In addition, PPBE phases were essentially sequential until 2001 when DoD began conducting programming and budgeting concurrently, and the growing emphasis on the execution phase was formalized in 2003 when the DoD’s PPBS became Planning, Programming, Budgeting and Execution (PPBE). Research & Development Procurement Military Construction Appropriations

The Objectives of Army PPBE
Army PPBE’s main objective is to establish, justify, and acquire the fiscal and manpower resources needed to accomplish the Army’s assigned missions in executing the Defense Strategy PLANNING Size, structure, man, equip, train, and sustain the Army force Distribute projected manpower, dollars, and materiel among competing requirements Convert resource allocation decisions into congressional requests PROGRAMMING & BUDGETING The PPBE process accomplishes four basic functions: - First, DoD develops and articulates its strategy (plan) to support the President's National Security Strategy (NSS). - Secondly, it determines priorities and identifies the necessary forces and programs (equipment, basing, personnel). - Third, the DoD requests monies to fund those programs. - Fourth, it executes approved funding against priorities in accordance with Congressional guidance. These four functions equate to the four PPBE phases - planning, programming, budgeting, and execution. PPBE is a continuous and repetitious process. A key event for both the federal budget cycle and the PPBE is the annual submission of the President's budget to Congress each year on the first Monday in February. However, Congress normally authorizes programs over a number of years but funds programs via annual appropriations. Meanwhile, federal agencies execute a current budget while preparing future budget proposals and accounting for prior execution years. To communicate clearly regarding budget time periods, Congress, the OMB, and the DoD make use of specific time period designations. PROGRAM EXECUTION BUDGET EXECUTION Manage and account for funds in approved programs Apply resources to achieve approved program objectives 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

A Continuous and Repetitious
Process Annual submission of the President's budget Multi-year program authorizations Annual appropriations Current budget execution Future budget preparation The PPBE process accomplishes four basic functions: - First, DoD develops and articulates its strategy (plan) to support the President's National Security Strategy (NSS). - Secondly, it determines priorities and identifies the necessary forces and programs (equipment, basing, personnel). - Third, the DoD requests monies to fund those programs. - Fourth, it executes approved funding against priorities in accordance with Congressional guidance. These four functions equate to the four PPBE phases - planning, programming, budgeting, and execution. PPBE is a continuous and repetitious process. A key event for both the federal budget cycle and the PPBE is the annual submission of the President's budget to Congress each year on the first Monday in February. However, Congress normally authorizes programs over a number of years but funds programs via annual appropriations. Meanwhile, federal agencies execute a current budget while preparing future budget proposals and accounting for prior execution years. To communicate clearly regarding budget time periods, Congress, the OMB, and the DoD make use of specific time period designations. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Budget Cycle Terms Fiscal Year (FY) Prior Year (PY) Current Year (CY) Budget Year(s) (BY) Program Year(s) (PrYs) Note: Refer students to page 1 of the PPBE summary sheet The most frequently used budget cycle time period designations are: Fiscal Year (FY), Current Year (CY), Prior Year (PY), Budget Year (BY), and Program Year(s) (PrYs). 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Fiscal Year Fiscal Year 2017 1 Oct start of FY 30 Sep end of FY J F M A M J J A S O N D J F M A M J J A S O N D Calendar Year 2016 Calendar Year 2017 The FY is the federal government's basic accounting period. The FY runs from 1 October to 30 September each year. Since this is the period in which agencies can obligate funds this is also know as the execution year. This fiscal accounting period begins on October 1st and ends on September 30 the following calendar year. Thus each FY is designated by the calendar year in which it ends. For example, FY99 began on October 1, 1998 and ended on September 30, 1999. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Prior Year 2016 DEC 1, 2016 CY = FY17 Oct 1, 2015 start of new FY O N D J F M A M J J A S O N D J F M A M J J A S FY16 = PY FY17= CY The PY is the FY prior to the CY. Again, assuming today is January 15, 2000, the PY is FY99. PYs are those FYs before the CY: FY99, FY98, FY97, etc. For example, assuming today's date is October 1, 2000, the correct abbreviation designation for the PY is FY99. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Current Year 2017 CY = FY17 Oct 1, 2016start of FY Sep 30, 2017 End of FY J F M A M J J A S O N D J F M A M J J A S O N D Calendar Year 2016 Calendar Year 2017 The current FY being executed is the CY. To illustrate, let's assume today's date is January 15, An installation resource manager obligating funds today is working in FY00. FY00 in this example is also the CY. On October 1, 2000 a new FY (FY01) begins. Until that date FY00 is the CY. The CY designation not only matches the current FY, it serves as the base line for other federal budget cycle period comparisons. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Two Budget Year (Odd Current Year) O N D J F M A M J J A S O N D J F M A M J J A S N D J F M A M J J A S FY17 – CY FY18 - BY FY19 - BY 2 Since 1987 the DoD has operated on a biennial budget cycle. In essence, the DoD submits a two-year budget proposal each odd number year. However, because Congress appropriates funds annually, in practice, the President and the DoD make annual budget submissions. As a result the two years following the CY are both considered BYs. NOTE: Refer to Fiscal Year memo dated 9 Apr 2010 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

One Budget Year (Even Current Year) Oct 1, 2018 start of new FY O N D J F M A M J J A S O N D J F M A M J J A S FY18 = CY FY19 = BY The primary focus of the President's budget is on the 1st BY. The 1st BY is the next FY and the year for which Congress is currently working to pass appropriation bills. PPBE also recognizes a second budget year. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Program Years (PrYs) Example: Assuming the current date is March 1, 2017 The Prior Year is Fiscal Year 2016 (FY16) The Current Year is FY17 The One Budget Years (BY) is FY18 The five Program Years (PrYs) are FY19-23 FY16 FY17 FY FY19 FY20 FY21 FY22 FY23 PY CY BY 1 PrY1 PrY2 PrY3 PrY4 PrY5 The five FYs following the two BYs are called the PrYs or outyears. Within the DoD, PrYs years allow the DoD to plan at most seven years beyond the CY. The DoD plans out an additional four PrYs from the BYs for force structure, personnel strength, and financial resources and then an additional three PrYs for force structure. Program Years Personnel Strength Force Structure 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Multiple Years Impacted
By PPBE Cycle Planning extends 15 to 17 years into the future (FY and beyond) Programming looks at 5 years into the future (FY 19-23) Budgeting looks at 1 and 2 years into the future (FY 18-19) Congress reviews the closest year into the future (FY 18) Execution covers the current year and several prior years (FY 13-17) Execution Congress Planning 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 -The purpose of this chart is to reinforce the iterative and overlapping nature of the PPBE process. -The PPBE process ties strategy, program, budget and execution together. It helps build a comprehensive plan in which budgets flow from programs, programs from requirements, requirements from missions, and missions from national security objectives. The patterned flow—from end purpose to resource cost—defines requirements in progressively greater detail. -In planning, programming and budgeting we deliberately revisit decisions made in prior cycles. As we get closer to the budget year we reevaluate earlier decisions in light of newer information. -While we are executing all appropriations this year, we are also continuing the execution of prior year appropriations that have a multi year life. -We previously noted that PPBE is a continuous and repetitious process. A FY that is currently a PrY will become a BY in a future cycle, which later becomes a CY, and then a PY. For example assuming today's date is January 15, 2000, FY'03, currently a PrY, will become a BY on October 1, In addition, FY'03 becomes the CY on October 1, 2002 and a PY on October 1, While it is helpful to think of the sequential nature of the budget cycle, it is also important to note that the DoD focus is always on multiple PPBE phases. Programming & Budget PPBE is the process through which DoD takes a long term perspective of its needs and prioritizes operational requirements within given fiscal constraints 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Program Objective Memorandum (POM)
Recommendation from the Services and Defense Agencies to OSD on how they plan to allocate recourses Cover a 5-years FYDP Presents proposal on how they will manage allocated recourses A Program Objective Memorandum (POM) is a recommendation from the Services and Defense Agencies to the Office of the Secretary of Defense (OSD) concerning how they plan to allocate resources for a program(s) to meet the Service Program Guidance (SPG) and Defense Planning Guidance (DPG). The POM covers the 5-year Future Year Defense Program (FYDP) and presents the Services and Defense Agencies proposal on how they will balance their allocation of available resources. The POM includes an analysis of missions, objectives, alternative methods to accomplish objectives, and allocation of resources. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Budget Estimate Submission (BES)
Is the 2-year (covers two years) budget submission to OSD Shows budget requirements for inclusion in the DoD budget during the PPBE process DoD compare POM to the BES in even years During the odd years, changes are submit to the previous year’s combined POM and BES. The Budget Estimate Submission (BES) is the two year DoD component’s budget submissions to OSD showing budget requirements for inclusion in the DoD budget during the Planning, Programming, Budgeting, and Execution (PPBE) process. The DoD components, in the even years, prepare their combined POM and BES. The POM and BES update the FYDP. The BES covers two years (such as FY 16 and FY 17). During the odd years, services only submit changes to the previous year’s combined POM and BES. Changes to the POM are known as Fact of Life Changes (FoLCs), while changes to the BES are known as Change Proposals (CPs). 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Multiple Cycles Ongoing Simultaneously
Today Distributing Funds And Reprogramming FY Cycle POM/BES FY 17-21 Congress FY 17 Execution FY 17 Posture Hearings and Markups POM Cycle Planning FY 18-22 POM/BES FY 18-22 Congress FY 18 Execution FY 18 A POM 19 began in NOV 2015 With TAA 19 POM build ending, POM submission next POM Cycle Planning FY 19-23 POM/BES FY 19-23 Congress FY 19 Execution FY 19 B Because the Army receives annual appropriations, any given PPBE cycle will overlap with other PPBE cycles for other years. From this chart and the previous two charts, we can see that at any given moment there are multiple years being managed by the Army staff in one of the PPBE phases. Important. You should always be specific as to which budget cycle you are working on or asking questions about because changes are made for each cycle. NOTE: Until 2010 the odd year budget submissions, used a vehicle called Change Proposals to update our financial decisions. Change Proposals were eliminated in April 2010 when OSD issued new guidance that the integrated POM/BES submissions would cover 5 years and be submitted each year (rather than POM/BES in even years and Change Proposals in odd years). Total Army Analysis & POM Planning Tasks POM Cycle POM 120 began in SEP{ 2016 With TAA 20 Planning FY 20-24 POM/BES FY 20-24 Congress FY 20 Execution FY20 We are now approaching “normal” sequencing of the timeline; this briefing focuses on points A & B JAN 15 JAN 16 JAN 17 JAN 18 JAN 19 JAN 20 12/9/2018 FINANCIAL MANA6EMENT SCHOOL

Future-Years Defense Program Structure
Organizations OSD, Defense Agencies, Joint Staff, etc. Army Navy Air Force Other Military Personnel Strategic Forces General-Purpose Forces Intelligence & Communications Airlift & Sealift National Guard & Reserve Forces Research & Development Central Supply & Maintenance Training, Medical, & Other Administration Support of Other Nations Special Operations Major Force Programs Operations & Maintenance Research & Development -The vitality of the PPBE is captured in the Future Years Defense Program (FYDP), a computerized database that summarizes all forces, resources, and equipment associated within programs approved by the SECDEF. It is DoD's vehicle for keeping track of the enormous volume of budget and program data over the PPBE timeframe. The FYDP helps both the DoD and Congress track appropriations and expenditures. -The FYDP is the official database containing eleven MFPs . (A 12th MFP for Space may be added in the future.) The MFPs define the mission and support responsibilities of the DoD. All Army and DoD programs contribute to the accomplishment of one or more of these eleven MFPs. As a result, the FYDP includes the official summary of programs developed within the PPBE process and approved by the SECDEF. The FYDP data can also be separated and viewed by DoD the component. -The FYDP also reflects the DoD's total obligation authority (the sum of conferred budget authority) and manpower for the PY, CY, BYs, and PrYs. In short the FYDP ties the planning, programming, and budgeting phases of PPBE together providing a cross walk between the DoD programs and Congressional appropriations. -The FYDP is able to display the total resources assigned to each program (forces, personnel, and funds arranged by MFPs or by DoD component or by appropriation category). It contains resources and force structure information for the PY, CY, the biennial Bys, and the following four years (the “outyears”). Thus it allows the DoD to take a multi-year focus for resource allocation. -Since the FYDP is also a key document in producing the President's budget request to Congress, the DoD structures the FYDP in two versions, one version by appropriations for Congress and a DoD version by MFPs. -Key Players in the PPBE process: A working knowledge of the ongoing and overlapping nature of PPBE and the key terms and concepts related to the budget and programming periods is of great assistance in understanding the interaction of PPBE process. Equally useful is a sound knowledge of the key player groups that exert control over the PPBE processes. This lesson focuses on seven groups directly involved in the development of PPBE activities - one group from the DoD level, five within the HQDA, and one at the MACOM/installation level. Procurement Military Construction Appropriations 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Major Players in the PPBE
Process: Level Organization OSD Senior Level Review Group (SLRG) HQDA Senior Army Leadership HQDA Army Enterprise Board (AEB) HQDA 3-Star Budget, Requirements, Program Board (BRP) HQDA 2-Star Budget, Requirements, Program Board (BRP) HQDA O-6 Budget, Requirements, Program Board (BRP) HQDA Program Budget Assessment Team (PBAT) HQDA Program Evaluation Groups (PEGs) Command/ Program Budget Advisory Committee (PBAC) Installation At the OSD level the Senior Level Review Group (SLRG) is the Senior advisory body to the Secretary of Defense on planning, programming, and budgeting matters. Conducts the combined Program Objectives Memorandum (POM)/Budget review. The Chair of the SLRG is the Deputy Secretary of Defense and the Vice Chair is the Chairman of the Joint Chiefs of Staff. The Executive Secretary of the SLRG is the Director, Cost Assessment & Program Evaluation (CAPE). Members include the following individuals: Secretaries of the Military Departments Under Secretary of Defense (Acquisition, Technology and Logistics) Under Secretary of Defense (Comptroller) Under Secretary of Defense (Policy) Under Secretary of Defense (Intelligence) Under Secretary of Defense (Personnel and Readiness) Other principal defense staff members, such as the Assistant Secretary of Defense (Networks and Information Integration), act as observers Effective Mar 2009, HQDA General Order effective 18 Mar 2009 states that the term EOH is no longer to be used. Must address the particular Army Senior Leadership you are referring to. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

SLRG Composition The Chair of the SLRG is the Deputy Secretary of Defense and the Vice Chair is the Chairman of the Joint Chiefs of Staff. The Executive Secretary of the SLRG is the Director, Cost Assessment & Program Evaluation (CAPE) Members include the following individuals: Secretaries of the Military Departments Under Secretary of Defense (Acquisition, Technology and Logistics) Under Secretary of Defense (Comptroller) Under Secretary of Defense (Policy) Under Secretary of Defense (Intelligence) Under Secretary of Defense (Personnel and Readiness) Other principal defense staff members, such as the Assistant Secretary of Defense (Networks and Information Integration), act as observers 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Key Army PPBE Organizations
The Army Secretariat Secretary of the Army Undersecretary of Army General Counsel Admin. Assist. Policy ASA (ALT) ASA (FM&C) ASA (I&E) ASA (M&RA) The Army Staff Army Budget Office Director, Army National Guard Budgeting/Execution Chief of Staff Vice Chief of Staff ASA (Civil Works) CIO/G6 The Inspector General The Auditor General Chief, Army Reserve Director of the Army Staff Chief, Legislative Liaison Chief, Public Affairs Director, Sml & Disadv Business Utilization Army Res Forces Policy Committee Management Directorate ASA(FM&C) is responsible for the overall management of the PPBE process with the Deputy Chief of Staff, G-3, Deputy Chief of Staff, G-8, and Military Deputy for Budget and Execution acting as advisers. The Assistant G‑3, the Director of Cost Assessment and Program Evaluation Office (CAPE) and the Director of the Army Budget (DAB) will manage functional phases of the system, each establishing and supervising policies and procedures necessary to carry out phase functions. Principal officials of the Office of the Secretary of the Army (OSA) will oversee operation of the PPBE process within assigned functional areas and provide related policy and direction. Earlier we saw that to the extent the APGM is a planning product, Director PAE also contributes to the planning effort. The further we move through the PPBE process for a given fiscal year the stronger the role of the Army Secretariat. Chief of Chaplains ACSIM Chief of Engineers The Judge Advocate Gen. The Surgeon General G1 G2 G3/5/7 G4 G8 Programming CAPE 12/9/2018 Planning

PPBE Decision Committees / Processes
BRP (Near-term (Execution) focus) DECISION Committees (Long-term (POM/BES) focus) Entry point for the decision process Reviews and recommends approval or disapproval of Schedule 8 changes, concept plans, and requirements changes Program Budget Assessment Team (PBAT) CoC Represents PPBC members. Responsible for coordinating matters that come before the PPBC Planning, Programming, & Budgeting Committee (PPBC) Council of Colonels (CoC) First executive level decision and advisory role Maintains overall discipline of PPBE Oversees PPBE schedule Planning, Programming, & Budgeting Committee (PPBC) Resolves resource allocation issues Monitors staff Implementation of SA/CSA decisions Makes recommendation, prioritization, resource allocation to SA/CSA Senior Review Group Senior Army leadership forum Approves prioritization of Army Programs Selects resource allocation alternatives Approves TAP, POM/BES Secretary of the Army Chief of Staff of the Army Gatekeepers for issues with resourcing implications Package proposals, frame issues, and coordinate matters that go before the 2-Star and Senior BRP COL BRP Coordinating, executive-advisory role Maintain overall discipline of resourcing process Ensure resourcing decisions align with Army priorities Recommend POM/BES solutions to 3-Star BRP 2-Star BRP Resolves resource allocation issues Recommend final decisions on The Army Plan, POM/BES Formulate issues for Senior Leaders of the Department of the Army 3-Star BRP Budget, Requirements, and Programs (BRP) PPBE Advisory Committees and process have changed over time. This chart reflects current organization. The Budget, Requirements and Programs (BRP) forums are called as needed or to serve in an advisory role and focus mainly on execution year issues. COL BRP Chaired by G3/5/7, PA&E G8, and ABO XOs - Represent 2-Star BRP Formulate and coordinate issues for 2-Star BRP 2- Star BRP Chaired by Asst G3, Dir. PA&E and DAB Evaluate PEGs output against guidance Recommend POM/BES solutions to 3-Star BRP 3-Star BRP Chaired by G3, G8 and MILDEP for Budget Recommend final decisions on The Army Plan, POM/BES Formulate issues for Senior Leaders of the Department of the Army 12/9/2018

Program Evaluation Groups
Senior Leaders DA SRG PPBC O-6 CoC PBAT PEG ASA(M&RA) & G-1 ASA(ALT) & G-8 ASA(M&RA) & G-3 ASA(M&RA) & AASA ASA(ALT) & G-4 ASA(I&E) & ACSIM Manning (MM) Equipping (EE) Training (TT) Organizing (OO) Sustaining (SS) Installations (II) Co-Chairs Title 10 Function Aligned with Title 10 functions and used to support PPBE decision making Set scope of resource requirements needed to execute Army programs and build initial POM Each PEG’s members include G3, G8, and ASA(FM&C) representatives ARNG, OCAR, and G6/CIO members serve as Program Integrators within each PEG AASA= Administrative Assistant to the Secretary of the Army ACSIM= The Army uses six Program Evaluation Groups (PEGs) to support planning, programming, and budgeting along Title 10 functional responsibility of the Army Secretary and Chief of Staff. PEGs program and monitor resources to perform Army functions assigned by Title 10, United States Code and to support the combatant commands to include initial POM build. Each PEG, subject to existing program and budget guidance, sets the scope, quantity, priority, and qualitative nature of resource requirements that define its programs. It monitors PEGs resource transactions and, as required, makes both administrative and substantive changes to assigned MDEPs which are the fundamental building blocks of the Army Program. MDEP proponents, subject matter experts, and, as appropriate, representatives of commands and agencies participate in PEGs deliberations. PEGs do not make resource decisions in isolation. In addition to input from the combatant commanders and ACOM, ASCC, DRU commanders which also includes the acquisition community and agency directors, Army leadership is also assisted by program integrators and functional experts as needed. The ARNG, OCAR, and CIO/G-6 action officers serve as Program Integrators to the PEGs, providing technical assistance to integrate priorities and statutory, Defense, and Army requirements for the ARNG, OCAR, and information technology programs into the Army’s overall program. Program Integrators to the PEGs integrate PEG decisions into their respective programs. . 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Program and Budget Assessment Team (PBAT)
Senior Leaders DA SRG PPBC O-6 CoC PBAT PEG Program Budget Assessment Team Co-Chairs G8 PA&E Program Development Division ASA (FM&C) Budget Formulation Division G3 FM Program Budget Guidance Division G1 P&R Resource Development Division Other Members PEG Administrators PA&E PEG Points of Contact Program Integrators Other Advisors (e.g. OTSG, COE - As needed) Appropriation Sponsors (As Needed) The PBAT is a working-level forum between the PPBC CoC and the PEGs that meets throughout the PPBE process. It makes the first comprehensive review of most of the Army’s resourcing issues generated by Army Commands, PEGs, the HQDA staff, the senior leaders, and other PPBE participants. The PBAT reviews and approves or rejects all Schedules 8, Concept Plans, and changes to resources within its authority. The PBAT disposes of many low-level resource issues, within its authority, that do not need to be handled by more senior level groups. The PBAT determines which resourcing issues need to be referred to a more senior PPBE forum and it prepares appropriate coordinates resource recommendations on those issues for presentation to the PPBC CoC. It will monitor the activities of the other PPBE decision forums. The PBAT packages proposals, frames issues, and otherwise coordinates matters that come before the PPBC CoC when it convenes. The working-level group makes PPBE decision-making more efficient and effective by disposing of low-level issues and only elevating to the PPBC CoC those issues that need to be made at a higher level. PBAT has four co-chairs while other decision forums have three The PBAT is a “working-level” group that was created to take care of most of the Army’s resourcing decisions at a lower level The PBAT reviews and approves or rejects all Schedule 8s, Concept Plans, and changes to resources 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Counsel of Colonels (CoC)
Senior Leaders DA SRG PPBC O-6 CoC PBAT PEG Represent the 2-Star BRP Serve Army leadership as entry point for all resourcing issues Gatekeeper for all issues with resourcing implications Package proposals, frame issues and coordinate all issues with resourcing implications Recommend solutions to the 2-Star BRP Ensure execution of 2-Star BRP/3-Star BRP/AEB/Senior Army Leadership decisions Make appropriate Colonel-level decisions The Council of Colonels represent PPBC members and meets throughout the PPBE process. The Council is co-chaired by the Chief, Resource Analysis and Integration Office, G-3; Chief, Program Development Division, Program Analysis and Evaluation Directorate; and Deputy Director of Management and Control, ASA(FM&C). The group packages proposals, frames issues, and otherwise coordinates matters that come before the PPBC when it convenes. In essence, the council makes PPBC decision making more efficient and effective. The O-6 CoC 1. Chief, Resource Analysis & Integration Division 2. G-3; Chief, Program Development Division 3. Program Analysis and Evaluation Director 4. Deputy Director of Management and Control, ASA(FM&C) 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Planning, Programming and Budgeting
Committee (PPBC) Senior Leaders DA SRG PPBC O-6 CoC PBAT PEG Maintains overall discipline of the PPBE process Ensure program/budget adjustments remain consistent with Army policy and priorities Unresolved PPBC issues are passed to the SRG Recommend solutions to the 3-Star BRP Make appropriate 2 Star-level decisions The Planning Program Budget Committee (PPBC) has three co-chairs, one of whom presides over the forum depending on its subject matter—the Assistant G-3 for planning, the Director Program Analysis and Evaluation for programming, and the Director, Army Budget for budgeting and execution. It is a continuing forum in which planning, program, and budget managers review, adjust, and recommend courses of action on relevant issues. The PPBC maintains overall discipline of the PPBE, oversees the PPBE schedule, monitors force management and preparation of The Army Plan (TAP), Program Objective Memorandum (POM), Budget Estimate Submission (BES) to OSD, and President’s Budget (PB). The PBAC 1. Assistant G-3 for planning 2. Director, Program Analysis & Evaluation for programming 3. Director, Army Budget for budgeting and execution 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Senior Review Group (SRG)
Senior Leaders DA SRG PPBC O-6 CoC PBAT PEG Senior level forum to resolve resource allocation issues Determine: Prioritization Resource alternatives Programming Budgeting Make recommendations to AEB and Senior Army Leadership on the most critical Army resourcing issues The Senior Review Group (SRG) serves as a senior level forum to resolve resource allocation and other issues but generally does not revisit decisions made at lower levels. The SRG makes recommendations to the Army Senior Leadership on: prioritization, resource alternatives, final TAP, program, and budget The co-chairs of the PPBC now serve in an advisory capacity to the SRG. This forum is co-chaired by the Under Secretary of the Army (USA) and Vice Chief of Staff, Army (VCSA). It generally does not revisit decisions made at lower levels. The SRG monitors staff implementation of decisions of the Senior Leaders of HQDA and makes recommendations to the Senior Leaders HQDA. You can look on this body as the board of directors for the Army. Also note that with few exceptions the PPBC membership reflects the organization of the Army Staff: General Counsel (represented) and the Office of the Surgeon General (not represented). The Senior BRP 1. Military Deputy for Budget, ASA (FM&C) 2. Deputy Chief of Staff, G8 3. Deputy Chief of Staff, G-3 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Senior Leaders Department
of the Army Senior Leaders DA SRG PPBC O-6 CoC PBAT PEG Set policy and approve guidance and priorities Have veto authority Make final resourcing decisions for the Army By law the SA has final decision authority Senior Army Leadership Secretary of the Army (SA) Chief of Staff, Army (CSA) Under Secretary of the Army (USA) Vice Chief of Staff, Army (VCSA) Director of the Army Staff (DAS) Sergeant Major of the Army (SMA) -- Other Members of the Army Staff as required The Senior Leaders “Big-Six” of the Department of the Army is the executive board making all final resourcing decisions for the Army, approves the prioritization of Army programs ,and selects resource allocation alternatives. The Secretary of the Army (SA) is the senior official of the Department of the Army and responsible for the effective and efficient functioning of the Army. By law the SA has final decision authority. The Chief of Staff, Army (CSA) serves as the senior military advisor to the SA in all matters and has responsibility for the effective and efficient functioning of Army organizations and commands in performing their statutory missions. The Under Secretary of the Army (USA) serves as the SA’s senior civilian advisor on the effective and efficient functioning of the Army. The Vice Chief of Staff, Army (VCSA) serves as the principal advisor and assistant to the CSA. The four members may seek advice from the Secretariat and Army Staff as needed. The Director of the Army Staff (non-voting member) synchronizes and integrates the HQDA staff. The DAS oversees the staff ensuring the effective integration and coordination of Army policy, positions, and procedures across the functional domains of Army responsibility. The Sergeant Major of the Army (non-voting member) is the senior enlisted member of the Army, and addresses the issues of enlisted soldiers in the Army. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

PPBC and SRG SRG Members (Meet as needed) USA VCSA G8 G3 G1 CAR G2
Planning Program and Budget Committee (PPBC) Serves the PPBE process in both a coordinating and executive-advisory role Represents all ARSTAFF and Secretariat Ensure program/budget adjustments remain consistent Army policy and priorities USA VCSA G8 G3 G1 CAR G2 CIO/G6 GC ASA(I&E) ASA(ALT) ASA(CW) DARNG G4 ASA(FM&C) ASA(M&RA) DASA(B)* ACSIM Asst G3* CAPE* SRG Members * Denotes Advisor Senior Review Group (SRG) The PPBC and SRG only meet when needed. The PPBC is chaired by the BRP8 and meets when resourcing decisions need the involvement of all represented organizations or when PPBE process updates need to be disseminated. PPBC is co chaired by the Director of the Army Budget (DAB), The Director, Cost Assessment & Program Evaluation (CAPE), G8 (G8,CAPE) and the Assistant Deputy Chief of Staff, G-3/5/7 Note that with few exceptions the PPBC membership reflects the organization of the Army Staff. The PPBC makes initial decisions and recommendations as a body and proposes appropriate program or budget positions to the Senior Review Group (SRG) and the Army Resource Board (ARB) The SRG is co-chaired by the Under Secretary of the Army (USA) and Vice Chief of Staff, Army (VCSA). The SRG generally does not revisit decisions made at lower levels. Senior level forum to resolve resource allocation and other PPBE-related issues Represents all ARSTAFF and Secretariat * Functional advisors as needed 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Budget, Requirements and
Programs (BRP) Boards There are three Budget, Requirements, and Programs (BRP) Boards, the Colonel BRP, the Two-Star BRP, and the Three-Star BRP. They serve in an executive-advisory or decision-making role to review significant execution-year or budget-year resource allocation, requirements, or prioritization issues. They address AR2B and ACP forum actions that require execution-year or budget-year resourcing adjustments in order to be implemented. Consideration of new BRP Board issues will normally start in the Colonels BRP Board before these issues are referred with recommendations to the Two-Star and Three-Star BRP Boards However, new issues may enter the BRP process at any level or may originate within one of the boards. The BRP Boards includes other Army Staff and Secretariat principals as required when addressing issues in which those principals have interest. It will serve in an executive-advisory role or decision-making role to review significant execution-year or budget-year resource allocation, requirements, or prioritization issues identified by senior leaders, HQDA staff, the Army Requirements and Resources Board (AR2B), the Army Campaign Plan (ACP) forums, or commands. The BRPs will : - Resolve execution-year or budget-year issues at the lowest practical level, considering outyear program implications for each case. - Make decisions within its authority. - Address AR2B and ACP forum actions that require execution-year or budget-year resourcing adjustments in order to be implemented. - Closely and continually coordinate with the ASA(FM&C) and seek ASA(FM&C), SRG, HQDA, or other approvals, as required. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

COL Budget, Requirements
and Programs Serves as the gatekeeper for execution-year or budget-year resource allocation, requirements, or prioritization issues Packages proposals, frames issues and coordinates all issues with resourcing implications Recommends POM/BES solutions to the 2-Star BRP Ensures execution of 2-Star BRP/3-Star BRP/Senior Leaders of the Department of the Army decisions O-6 BRP COL BRP meets throughout the PPBE process. The COL BRP is co-chaired by the: Chief, Resource Analysis and Integration Office, G-3/5/7; Chief, Program Development Division, Program Analysis and Evaluation Directorate; and Chief, PPBE Integration, ASA(FM&C) It is a continuing forum in which planning, program, and budget managers review, adjust, and recommend courses of action on relevant issues. COL BRP Chief, PPBE Integration, ASA(FM&C) Chief, PDD, PA&E, G-8 CIR, G-3/5/7 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

2-Star Budget, Requirements
and Programs The Two-Star BRP Board co-chairs will be the Assistant G-3/5/7, the DPA&E, and the DAB, ASA(FM&C) Provide a central clearinghouse and coordination function for BRP activities Recommends POM/BES solutions to the 3-Star BRP 2-Star BRP is a decision making forum made up of Assistant G-3/5/7 (planning) , the Director Program Analysis and Evaluation (programming), and the Director, Army Budget (budgeting and execution) augmented by appropriate Army Staff members as needed. The 2-Star BRP is a continuing forum in which planning, program, and budget managers review, adjust, and recommend courses of action on relevant issues. 2-Star BRP maintains overall discipline of BRP functions. 2-Star BRP Director of the Army Budget, ASA(FM&C) Director, Program Analysis & Evaluation, G-8 Assistant, G-3/5/7 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

3-Star Budget, Requirements
and Programs The Three-Star BRP Board is co-chaired by the G-3/5/7, the G-8, and the MILDEP for Budget, ASA(FM&C). The BRP Board includes other Army Staff and Secretariat principals as required when addressing issues in which those principals have interest. Makes recommendations to the Senior Leaders of the Department of the Army SENIOR BRP The 3-Star BRP is a three star decision making body to resolve resource allocation issues. The 3-Star BRP is chaired by Military Deputy for Budget, ASA(FM&C), Deputy Chief of Staff, G-8, and Deputy Chief of Staff, G-3 3-Star BRP Determines: Prioritization Resource alternatives Programming Budgeting Make recommendations to Senior Army Leadership on the most critical Army resourcing issues The 3-Star BRP generally do not revisit decisions made at lower levels. The 3-Star BRP makes recommendations to the Senior Army Leadership. Made up of the ASA (FM&C) Military Deputy for Budget, the Deputy Chief of Staff G-8, and the Deputy Chief of Staff G-3/5/7, the 3-Star BRP is a three star decision making body to resolve resource allocation issues. The three-star BRP will resolve execution-year or budget-year issues at the lowest practical level, considering outyear program implications for each case. Because of the time sensitivity of these cases, the Three-Star BRP Board may task the Two-Star BRP Board and the Colonels BRP Board to advise and assist it. Consideration of new BRP Board issues will normally start in the Colonels BRP Board before these issues are referred with recommendations to the Two-Star and Three-Star BRP Boards. However, new issues may enter the BRP process at any level or may originate within one of the boards. 3-Star BRP Military Deputy for Budget, ASA(FM&C) Deputy Chief of Staff, G-8 Deputy Chief of Staff, G-3/5/7 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Army Enterprise Board Army Enterprise Board (AEB) Advises on prioritization of Army programs Recommends resource allocation alternatives Reviews and makes recommendations on TAP, POM/BES AEB Memebership Under Secretary of the Army (CMO) Vice Chief of Staff of the Army Assistant Secretary of the Army (Financial Management and Comptroller) Assistant Secretary of the Army (Manpower and Reserve Affairs) Assistant Secretary of the Army (Acquisition, Logistics and Technology) Assistant Secretary of the Army (Installations and Environment) Commander, Forces Command (Readiness Core Enterprise Lead) Commander, Training and Doctrine Command (Personnel Core Enterprise Lead) Commander, Army Materiel Command (Materiel Core Enterprise Lead) Commander, Installation Management Command (Services and Infrastructure Core Enterprise Lead) -- CAR and DARNG may serve as adjunct AEB members as needed -- Select subject matter experts (SMEs) may serve as advisors The AEB serves as a senior strategic-level advisory body in HQDA responsible for reviewing strategic Army issues and recommending solutions to the Secretary of the Army and his strategic partner, the Chief of Staff of the Army, for the Secretary’s decision. Recommendations will support Army-wide results in the best interests of the Army and the Department of Defense (DoD). The AEB reports to and receives its direction from the SA or designated representative. The AEB will advise our functional alignment into core enterprises in accordance with Title 10, General Order Number 3, and Army regulations on a schedule that will not interfere with current operations. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Check On Learning How does the Army allocate and manage resources?
True / False. PEGs (Program Evaluation Group) evaluate, modify, and prioritize MDEPs as needed. What FY follows the Current Year? Q. What FY is before the Program Years? Q. At what level is the PBAC held? Q. At what level is the SLRG held? Through the management system of PPBE True Budget Year Check on Learning NOTE: Conduct a check on Learning Budget Year ACOM / Installation OSD

PPBE Phases Planning Programming Budgeting Execution These are the 4 Phases of PPBE We will talk each one individually. CHECK ON LEARNING: Q: True/False: Does HQDA use PPBE as a resource allocation and management system? A: True Q: Who is responsible for initially evaluating and prioritizing MDEPs at the HQDA level? A: Program Evaluation Groups (PEGs) Q: What fiscal years follow the budget years? A: Program Years 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

The PPBE Planning Phase
Note: Refer students to page 2 of the PPBE summary sheet (paragraph 6) -The process used to acquire, allocate, and account for DoD personnel, equipment and financial resources begins with a plan. The objective of the Planning Phase is to identify threats to national security, assesses capabilities to meet those threats and recommend the forces required to defeat them. PPBE planning determines requirements including the size, structure, and manning of the force. In effect it attempts to answer the question "how much defense is enough?" -The PPBE Planning Phase identifies the capabilities required to deter and defeat threats. -At the DoD level, the planning phase examines the role and posture of the U.S. and the DoD in a global environment with a focus on potential enemy capabilities and threats, allies capabilities, alternative U.S. policies (economic, diplomatic, military), military strategies in support of U.S. policies, planning force levels to achieve strategies, and planning assumptions. The major product of the Planning Phase at the DoD level is the Guidance for the Development of the Force. -For the Army the Planning Phase specifically identifies the capabilities needed to conduct operations on land in support of the National Security Strategy (NSS) and the National Military Strategy (NMS), building upon that guidance and adding the necessary detail for program development. The major product of the Planning Phase for the Army is The Army Plan (TAP). -Planning includes the identification and examination of alternative strategies and the analysis of changing conditions and trends, threat, technology, and economic assessments. It also includes efforts to both understand change and define the long-term implications of current choices. However, at its core PPBE Planning is the process for determining requirements. -One important facet of the planning phase at the DoD level is the development of planning assumptions to be used as guidance during the programming and budgeting phases. Such assumptions include projected peacetime funding levels as well as required combat deployment readiness levels. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Looking Out: PPBE Planning Timeframes
Near-Term (Execution, President’s Budget (PB), and Budget Estimate Submission (BES): Monitor execution of current year’s budget and several prior years Congress reviews next year’s budget Budgeting looks at the following 1-2 years Out-Years (Future Years Defense Program (FYDP)): Programming looks 5 years in the future First 1-2 years are the same as the budgeting years Future (Extended Planning Period (EPP)): Planning extends years into the future Planning horizon can be longer (i.e. Military Construction) BUDGET FYDP EPP Future Near-Term (Execution, President’s Budget (PB), and Budget Estimate Submission (BES): Monitor execution of current year’s budget and several prior years Congress reviews next year’s budget Budgeting looks at the following 1-2 years Out-Years (Future Years Defense Program (FYDP)): Programming looks 5 years in the future First 1-2 years are the same as the budgeting years Future (Extended Planning Period (EPP)): Planning extends years into the future Planning horizon can be longer (i.e. Military Construction) Out-Years Near-Term 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

National Security Strategy (NSS)
Developed by National Security Council – establishes nation’s grand strategy and addresses all elements of national power (military and other) used to achieve national goals Description: Published at NCA’s discretion (generally upon change in administrations or in wake of significant event) Drives all Joint and OSD planning activities; feeds directly into the NMS Should be viewed as the foundational document for all strategic planning efforts throughout the military; these efforts should be able to link their primary thrusts back to the key objectives of the NSS HQDA Utility: Impact of the NSS carries into the POM/BES build Foundation for all major Army planning activities – all should link back to the NSS Influences all sections of TAP Influences AMP Influences RDA Plan Influences Army requirements develop. Can be a significant factor in the assessment and/or justification of Army programming choices by OSD and Congress The NSS is published at the NCA’s discretion. In the past, most newly elected Presidents have wanted to put their stamp on national security policy and publishing a new iteration of the NSS is a quick way to do this. A significant geo-political event can also trigger a new iteration of the NSS. The last NSS iterations occurred in September, 2002, codifying the shift in US strategic thinking in the wake of the 9/11 attacks and the war in Afghanistan and in again in March 2006 to address the continuing conflicts in Iraq and Afghanistan and the continued GWOT. The NSS is a broad document that lays out the key thrusts of US national security policy. In doing so, it touches upon aspects of military, economic, diplomatic, social, and human rights policies, all of which are viewed as the “means” of achieving US strategic objectives. From the military standpoint, the NSS is the source document for lower level planning efforts in OSD, the Joint world, and the Services. Not surprisingly, the guidance contained within such a top level document is quite broad. Particular military systems or programs are rarely mentioned. Instead, broader objectives and capabilities are cited. While detailed guidance is limited, key capability thrusts are readily apparent. The ability to link a program to one of these capabilities is very beneficial as the program is guided through the perils of the PPBE process. The current focus of the NSS: Champion the aspirations of human dignity Strengthen alliances against global terrorism and prevent future attacks Defuse regional conflicts Use free markets/free trade to spark future growth Open societies and build democratic infrastructure Develop agendas for cooperative action with other global powers Transform US national security organs to meet 21st century challenges 12/9/2018 NSS 2010 FINANCIAL MANAGEMENT SCHOOL

National Defense Strategy (NDS)
Developed by OSD– establishes the Department of Defense overall strategy and addresses all elements of national power (military and other) used to achieve the NSS. Description: DoD’s capstone document in its long-term effort. Describes DoD’s overarching goals and strategy. Drives all military planning activities. Outlines how DoD will support the objectives outlibes in the National Security Strategy (NSS). Five key objectives outlined in the NDS- (Defend the Homeland, Win the Long War, Promote Security, Deter Conflict and Win our Nation’s Wars) HQDA Utility: Impact of the NSS & NDS carries into the POM/BES development process. Foundation for all major Army planning activities – all should link back to the NSS Influences all sections of TAP Influences Total Army Analysis (TAA) Influences RDA Plan Influences Army requirements development. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL NATIONAL DEFENSE GUIDANCE

National Military Strategy (NMS)
Means by which the CJCS provides advice and assistance to President and SECDEF regarding the strategic direction of the armed forces – relies on coordination with members of the JCS, Services and Combatant Commanders during development Description: Published at CJCS’s discretion (always updated in wake of new NSS) Describes how US military capabilities support the national security objectives outlined in the NSS The NMS describes: Strategic environment National military objectives Strategies to accomplish these objectives Capabilities required to execute the strategy The NMS provides strategic direction for development of the JCSP, JPD and GDF/JPG HQDA Utility: Should be used as a source of overarching strategic direction – significant long-term capability objectives should link to NMS Should inform development of The Army Plan and The Army Modernization Strategy Planning and programming defense /justification should cite specific NMS sections (look for linkages between the NMS and the GDF/JPG) The law requires the NMS be submitted with the President’s Budget every 2 years The Chairman of the Joint Chiefs of Staff provides strategic direction to the military through the National Military Strategy, consistent with the QDR and the National Defense Strategy. The National Military Strategy provides strategic direction from the Chairman of the Joint Chiefs of Staff on how the Joint Force should align the military ends, ways, means, and risks consistent with the goals established in the QDR and the National Defense Strategy. The National Military Strategy is reviewed biennially, with updates issued as needed. A standing document that is changed as needed (usually in wake of new NSS), the NMS applies to the program years (2 to 8 years in the future). The NMS seeks to accomplish the following objectives: (1) Summarize the global strategic setting (relying on input from the Joint Strategic Review) (2) Discuss potential risks and threats (3) Recommend military foundations and strategic principles to support national security objectives (4) Provide strategy and force levels that conform to the fiscal guidance of the President and SECDEF 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Joint Strategic Planning System
(JSPS) Overview The Joint Strategic Planning System (JSPS) provides the strategic foundation for all DoD planning – statutory responsibilities include: Performing assessments to support advice and assistance to NCA Assisting NCA in providing strategic direction to the armed forces Preparing strategic plans Providing advice regarding program recommendations and budget proposals Flexible system/process, capable of interacting with PPBE and Acquisition processes; produces NMS, CPR, CPA and other products that influence Army PPBE Owned by the CJCS, though all members of the defense establishment participate Joint Staff J5 (Strategic Plans and Policy Directorate) manages the JSPS Joint Staff J8 (Force Structure, Resources and Assessment Directorate) ensures that linkage exists between future US military force structure and future national objectives Two key sub-processes constitute a continuous process Joint Strategy Review Joint Net Assessment All joint strategic planning takes place within the context of the Joint Strategic Planning System – which provides a mechanism for the continuous review of the national military environment and the assessment of the armed services’ capability to meet national security objectives. The JSPS is comprised of two ongoing processes: (1) The Joint Strategy Review (JSR) lies at the core of the JSPS and serves to integrate strategy, operational planning and program assessments. The JSR continuously gathers information through the examination of current, emerging, and future issues related to threats, strategic assumptions, opportunities, technologies, doctrine, force structure, and missions. This information is the basis for an annual assessment of issues affecting the national military strategy. These assessments are provided to the Chairman of the Joint Chiefs of Staff, Service Chiefs, and Combatant Commanders as guidance for maintaining or adjusting the NMS and other joint products (2) The Joint Net Assessment (JNA) provides the means to assess force strengths and deficiencies, comparing defense capabilities of the U.S. and its allies to those of potential adversaries. The JNA works through a continuous 4-year cycle and focuses on the end of the FYDP period. Results help evaluate current strategies and the development of alternate force structures and strategies. The JSPS is a process, not a product! 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

JSPS Programming Guidance
Chairman’s Program Recommendation (CPR) Reinforces strategic direction of GDF and JPG Adjusts priorities Specifics on programs of greatest concern CJCS advice to shape final GDF, JPG, and Service POM/BES submissions Services submit POM/BES to OSD CJCS assessment of POM force structure Provides advice on alternative programs Influence on SECDEF program decisions Feeds back into JSPS Chairman’s Program Assessment (CPA) The CPR, and CPA can be reviewed together under the broad topic of programming guidance – converting plans into actionable direction for the POM/BES build. The CPR compares planning guidance and objectives with current and projected resource profiles from the President's most recent budget submission and the current FYDP. The CPR focuses on recommendations that enhance joint readiness, doctrine, and training. The CPA is published after submission of Service POMs and reviews the capabilities of the composite force and support levels recommended by the services, comparing recommended capabilities and levels with those recommended by the SECDEF. The CPA is used by SECDEF during OSD program and budget review. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

OSD Direction and Guidance
Prepared by the office of the Under Secretary of Defense for Policy, in conjunction with the Joint Staff and the services Issued for the first time by SECDEF in May 2008 Replaces Strategic Planning Guidance (SPG), Transformation Planning Guidance, Posture Guidance, Science and Technology Strategic Guidance and several other guidance documents Intent: Provide a single, authoritative volume to planners across the services who are responsible for making strategic resource allocations Considers a long-term (20-year) view of the security environment and helps shape the investment blueprint for nearer-term spending across the upcoming six-year program Guidance for Development of the Force (GDF) Establishes Army’s Total Obligation Authority (TOA) over program years Includes inflation factors, other administrative instructions Fiscal Guidance Prepared by the office of the Under Secretary of Defense for Policy, in conjunction with the Joint Staff and the services, the Guidance for the Development of the Force (GDF) replaces Strategic Planning Guidance (SPG), Transformation Planning Guidance, Posture Guidance, Science and Technology Strategic Guidance and several other guidance documents. The intent behind consolidation was to provide to planners across the services who are responsible for making strategic resource allocations a single, authoritative volume rather then leaving them to consult numerous documents, many of which were issued at different times throughout the two-year force development timeline and often contained conflicting and redundant guidance. GDF is used mainly by the Military Departments and Defense Agencies to align their internal priorities with DoD-wide performance goals for force development, management, and corporate support in the longer term (present through 2 to 6 years and beyond). The GDF establishes priorities within and across Joint Capability Areas and articulates the Department’s force planning construct, as established in the Quadrennial Defense Review (QDR). The GDF considers a long-term (20-year) view of the security environment and helps shape the investment blueprint for nearer-term spending across the up-coming six-year program. Issued for the first time by SECDEF in May 2008, it establishes priorities within and across Joint Capability Areas managed by Capability Portfolio Managers (CPMs). Fiscal Guidance (FG) . Annual top-line funding guidance, for each year of the Program Objective Memorandum (POM), for each DoD Component, issued by the Secretary of Defense (SECDEF). Provides fiscal constraints that must be observed by the DoD Components in the formulation of program and force structures and by the Office of the Secretary of Defense (OSD) and joint staff in reviewing proposed programs. Joint Programming Guidance. The Joint Programming Guidance (JPG) is issued in On-Budget Years (even-numbered years), and contains fiscally constrained programmatic guidance and performance measures. The JPG drives the development of the Program Objective Memoranda (POM) and Budget Estimate Submissions (BES). The JPG is the principal Department of Defense (DoD) planning document and reflects the President’s prioritized national security objectives drawn from the National Security Strategy (NSS), the National Military Strategy (NMS), and the Quadrennial Defense Review. FG and JPG set specific fiscal controls and direct explicit program actions, respectively, for each Military Department and Defense Agency, consistent with the outcome and output goals established in the GDF. They are updated biannually. Contains SecDef’s decisions based on the Enhanced Planning Process Provides direction for incorporating those decisions into the programs and budgets of military departments and defense agencies Guide portions of service and defense agency POM development Joint Programming Guidance (JPG) 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Quadrennial Defense Review (QDR)
The QDR fulfills the Government Performance and Results Act (GPRA) of 1993 requirement that DoD submit to the Office of Management and Budget and to the Congress a strategic plan for agency program activities. DoD meets the requirement using the Quadrennial Defense Review (QDR) Description: Published by DoD every 4 years Benefits from extensive consultation with the President of the United States Outlines the key changes needed to preserve America's safety and security in the years to come Particular emphasis is given to homeland defense, surprise, preparing for asymmetric threats, to the need to develop new concepts of deterrence, to the need for a capabilities-based strategy, and to the need to balance the different dimensions of risk. HQDA Utility: Should be used to determine the strategic direction and planning principles for all Army planning efforts Impacts most significantly on Army Modernization Strategy and TAP Sections I and II Requirements and program defense and/or justification should cite specific QDR passages when possible OSD also publishes the Quadrennial Defense Review (QDR) every four years. The QDR functions as DoD’s strategic plan and identifies geopolitical trends, international security trends, and domestic trends, while highlighting hurdles, opportunities and transformational requirements facing the U.S. military. The GDF/JPG reflect the long-term corporate goals detailed in the QDR. QDR QDR in Perspective

Integrated Priority List (IPL)
Each Combatant Command builds an Integrated Priority List, representing the Combatant Commander’s top warfighting needs while highlighting program deficiencies that impact warfighting capability and providing the Combatant Commander’s recommendations on curing these deficiencies Description: Published annually by each command Identifies and prioritizes capability issues that: Preclude achievement of a command mission Require development during POM build Provides recommended programmatic solutions Usually 7-10 issues; classified Influences CJCS in developing JPD, CPR and CPA; Influences GDF/JPG; Critical input into Program/Budget Review HQDA Utility: Provide insight into COCOM critical capability gaps not currently being met by the Program Intended to influence development of Service POM/BES HQDA must be concerned about the current year’s IPL and the prior year’s IPL – both will influence development of the POM/BES and the OSD Program and Budget Review Satisfaction of IPL is an important source of POM/BES justification – if there is an IPL for your program, you must explain how it was responded to. The Integrated Priority List (IPL) is a list of a combatant commander’s highest priority requirements defining shortfalls in key programs that, in the judgment of the combatant commander, adversely affect the ability of the command’s forces to accomplish their assigned missions. The IPL provides the combatant commander’s recommendations for programming funds in the PPBE process, and represent the initial step in identifying critical warfighter capability shortfalls that need to be addressed in the FYDP. IPLs are usually not service specific nor are they resource constrained. That said, each IPL capability issue will impact one or more services and the associated Recommended Programmatic Solutions will emphasize programming that can be linked to individual services. Recommended solutions can reach to manpower, systems and/or programs, and monetary. IPLs are not resource constrained, yet they allow the Services to develop their own programmatic solutions to meet the identified capability shortfalls. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Defense Planning Guidance (DPG)
Prepared by OSD the DPG is a principal product of OSD planning. It reflects military advice and information recommended by the CJCS; service long-range plans and positions on policy and other matters advanced by Service Secretaries; and UCC appraisals of major issues and problems bearing on command missions. Description: contains defense strategy and the guidance for key planning and programming priorities to execute that strategy. The DPG presents the SECDEF's strategic plan for developing and employing future forces Should be viewed as the foundational document that reflects resource constrained guidance that the DoD will impose during the POM period HQDA Utility: Impact of the DPG carries into the Army POM Reflects resource-constrained guidance based upon affordability, analysis, and estimates of fiscal constraints that OSD will impose The NSS is published at the NCA’s discretion. In the past, most newly elected Presidents have wanted to put their stamp on national security policy and publishing a new iteration of the NSS is a quick way to do this. A significant geo-political event can also trigger a new iteration of the NSS. The last NSS iterations occurred in September, 2002, codifying the shift in US strategic thinking in the wake of the 9/11 attacks and the war in Afghanistan and in again in March 2006 to address the continuing conflicts in Iraq and Afghanistan and the continued GWOT. The NSS is a broad document that lays out the key thrusts of US national security policy. In doing so, it touches upon aspects of military, economic, diplomatic, social, and human rights policies, all of which are viewed as the “means” of achieving US strategic objectives. From the military standpoint, the NSS is the source document for lower level planning efforts in OSD, the Joint world, and the Services. Not surprisingly, the guidance contained within such a top level document is quite broad. Particular military systems or programs are rarely mentioned. Instead, broader objectives and capabilities are cited. While detailed guidance is limited, key capability thrusts are readily apparent. The ability to link a program to one of these capabilities is very beneficial as the program is guided through the perils of the PPBE process. The current focus of the NSS: Champion the aspirations of human dignity Strengthen alliances against global terrorism and prevent future attacks Defuse regional conflicts Use free markets/free trade to spark future growth Open societies and build democratic infrastructure Develop agendas for cooperative action with other global powers Transform US national security organs to meet 21st century challenges

External Planning DPG Defense Planning Guidance The next several slides will review planning documents and procedures that take place at National, Department of Defense, and Joint Staff levels and affect Army planning. This is a diagram of most of the planning products that affect Army Planning. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Army Planning The Army Plan Total Army Analysis Note: Refer students to page 4 of the PPBE summary sheet (paragraph 6. f & g) The next several slides will review planning documents and procedures that take place at National, Department of Defense, and Joint Staff levels and affect Army planning. This is a diagram of most of the planning products that affect Army Planning. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Planning The Army Plan (TAP)
The Army Plan (TAP) aligns and nests the Army’s planning documents with joint guidance and capabilities, using a Title 10 lens Army Title 10 Lens The Army Plan (TAP) Section I Army Vision Army Strategic Planning Guidance DCS G-3/5/7 Section II Strategy Army Strategic Plan DCS G-3/5/7 Section III Priorities Army Planning Guidance DCS G-3/5/7 Section IV Programming Army Program Guidance Memorandum DCS G-8 (PA&E) Section V Army Campaign Plan DCS G-3/5/7 Also published as ACP Annex E Every Four Years The Army Plan (TAP) provides guidance for strategic planning, priorities, programming guidance and campaign execution: The Army Vision (AV) captures the unified direction of the Secretary and Chief of Staff, Army and articulate the Army's "ends" in support of guidance from the National Command Authority (NCA). Army Strategic Plan (ASP) articulates a strategy that directs how the Army will fulfill its Title 10 responsibilities and additional statutory requirements over a 10 year time horizon. Army Planning Guidance (APG) is to initiate the Army's annual PPBE process by identifying and providing guidance for key planning issues that require resolution or additional guidance before the POM build is complete. The Army Program Guidance Memorandum (APGM), is to codify decisions made throughout the planning process in order to resolve each of the issues identified in the APG. Army Campaign Plan (ACP) establishes and monitor annual priorities and initiatives from the Secretary and Chief of Staff, Army that require measurable endstates or decisions in the year of execution. Title 10: > < Biannual Annual Annual Semi-annual Primary inputs are relevant NCA guidance Serves as the unifying document for all other Army strategic documents and plans Key linkage between strategy and budget Initiate the Army's annual PPBE process Addresses near, mid, and far term planning issues that apply to a specific budget year Prioritization guidance addressing the hierarchy of functions for program development and budget execution Codify decisions made throughout the planning process in order to resolve each of the issues identified in the APG Begins the Army's programming phase for the annual PPBE process Establishes and monitors annual priorities and initiatives from the Secretary and Chief of Staff (Army) Strategic Efforts identify priorities and initiatives that require integration across the Army and assist in aligning objectives, resources and time. Supports the guidance of the National Command Authority Source document of the revised TAP Primarily intend for external audiences (ODC Congress, White House, thinks tanks…)

TAP – Section I Army Vision (AV) Captures the unified direction of the Secretary and Chief of Staff, Army Articulates the desired endstate of the Secretary and the Chief of Staff, Army over a 10 year time horizon Source document to which all other sections of the revised TAP are tethered AV is primarily intended for external audiences Principal authors, personal staffs of the Secretary and the Chief of Staff, Army, The purpose of the AV, sections I of TAP, is to capture the unified direction of the Secretary and Chief of Staff, Army and articulate the Army's "ends" in support of guidance from the National Command Authority (NCA). The AV articulates the desired endstate of the Secretary and the Chief of Staff, Army over a 10 year time horizon; at once, both challenging the Army and providing a "touchstone" to drive future change. It is the source document to which all other sections of the revised TAP are tethered, and serves as the central document from which all other strategic communication documents (e.g., the Army Posture Statement (APS)) emanate. Although the AV informs the initial strategic choices that the Army Strategic Plan (ASP) outlines, the AV is primarily intended for external audiences (Office of the Secretary of Defense (OSD); Congress; the White House; think tanks; etc.). The AV's principal authors will be the personal staffs of the Secretary and the Chief of Staff, Army, with assistance from the immediate staffs of the Under Secretary of the Army and Vice Chief of Staff, Army, as appropriate. The Deputy Chief of Staff (DCS), G provides additional support, as required. At a minimum, the AV should be reviewed or published every four years, in close proximity to the release of a new Quadrennial Defense Review (QDR). Although the AV is intended to endure over multiple Program Objective Memorandum (POM) cycles, some factors may necessitate more frequent changes or updates (e.g., radical shifts in the operational or fiscal environment; significant updates to NCA guidance; significant changes to senior leader thinking; etc.). 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Army Strategic Plan (ASP)
TAP – Section II Army Strategic Plan (ASP) Articulates a strategy that directs how the Army will fulfill its Title 10 responsibilities Re-emphasizes the Army's 'ends' and defines and describes the strategic goals and objectives of senior leaders. Serves as the key linkage between strategy and budget and informs the Army's annual planning efforts as part of PPBE process Not directly linked to any single (Program Objective Memorandum) POM or fiscal year The DCS, G-3/5/7 serves as the proponent for the ASP Army Strategic Plan (ASP) - The purpose of the ASP, section II of TAP, is to articulate a strategy that directs how the Army will fulfill its Title 10 responsibilities and additional statutory requirements over a 10 year time horizon. Its primary inputs are relevant NCA guidance (e.g., Defense Strategic Guidance (DSG); National Security Strategy (NSS); etc.) and the Army Vision. Building on the AV and other senior leader guidance, the ASP re-emphasizes the Army's 'ends' and defines and describes the strategic goals and objectives of senior leaders. Additionally, the ASP provides a strategic assessment of the operating environment, explicitly articulates key assumptions in its strategy formulation, and identifies key areas of risk. The ASP serves as the unifying document for all other Army strategic documents and plans (e.g., Army Modernization Strategy; Army Facility Strategy; etc.). Strategic guidance from the ASP directs planning and programming across multiple Future Years Defense Programs (FYDPs), including Total Army Analysis (TAA), and guides changes to Doctrine, Organization, Training, Materiel, Leadership, Personnel, Facilities and Policy (DOTMLPF-P). The ASP serves as the key linkage between strategy and budget and informs the Army's annual planning efforts as part of the Planning, Programming, Budgeting and Execution (PPBE) process. Despite its budget and programming implications, the ASP is a strategic document not directly linked to any single POM or fiscal year. The DCS, G-3/5/7 serves as the proponent for the ASP, and coordinates with relevant HODA Principal Officials, Army Commands (ACOMs), Army Service Component Commands (ASCCs) and Direct Reporting Units (DRUs) at appropriate times throughout ASP development. The ASP is published not later than 120 days following the release of each QDR. Additionally, the ASP is reviewed every two years and republished when senior leaders determine an update is required. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Army Planning Guidance (APG)
TAP – Section III Army Planning Guidance (APG) Initiates the Army's annual PPBE process Addresses near, mid, and far term planning issues that apply to a specific budget year, later in the FYDP, or endure throughout it Provides a detailed description and applicable senior leader guidance and identifies a responsible body for adjudication of that issue APG provides descriptive or prescriptive prioritization guidance addressing designates those areas that the Secretary and Chief of Staff, Army has determined require centralized performance assessment management by the ACP Army Planning Guidance (APG) - The purpose of the APG, section Ill of TAP, is to initiate the Army's annual PPBE process by identifying and providing guidance for key planning issues that require resolution or additional guidance before the POM build is complete. These planning issues may be identified from the previous year's POM, throughout program review, or as a result of decisions from other external actors (e.g., Congress; OSD; the White House; etc.). The APG will address near, mid, and far term planning issues that apply to a specific budget year, later in the FYDP, or endure throughout it. The APG identifies each issue, provides a detailed description and applicable senior leader guidance and identifies a responsible body for adjudication of that issue (e.g., the Army Management Action Group (AMAG); Planning, Program Budget Committee (PPBC); Army Requirements Oversight Council (AROC); etc.). Additionally, the APG provides descriptive or prescriptive prioritization guidance addressing the hierarchy of functions for program development and budget execution. This prioritization guidance provides the ACOMs, DRUs, and Program Evaluation Groups (PEGs) with initial senior leader guidance that remains applicable throughout the PPBE process unless superseded by new guidance from the Secretary and/or Chief of Staff, Army. Finally, the APG designates those areas that the Secretary and Chief of Staff, Army has determined require centralized performance assessment management by the ACP. The DCS, G-3/5/7 serves as the proponent for the APG, and coordinates with the other co-chairs of the PPBC and members of the PPBC throughout the staff process. The APG is published not later than July 4th, each year. Further updates and fragmentary orders (FRAGOs) to the APG may be published as refinements require. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Army Programming Guidance Memorandum (APGM)
TAP – Section IV Army Programming Guidance Memorandum (APGM) Codifies decisions made throughout the planning process The APGM signals the end of the Army's planning phase and beginning of the Army's programming phase for the annual PPBE process and provides specific programming guidance that informs the POM build. The Director, PA&E (DCS, G-8) serves as the proponent of the APGM, and coordinates with the other co chairs of the PPBC and other members of the PPBC throughout the staff process. Goals Objectives Sub-Objectives Prioritized Tasks Army Programming Guidance Memorandum (APGM) - The purpose of the APGM, section IV of TAP, is to codify decisions made throughout the planning process in order to resolve each of the issues identified in the APG. The APGM signals the end of the Army's planning phase and beginning of the Army's programming phase for the annual PPBE process and provides specific programming guidance that informs the POM build. The Director, PA&E (DCS, G-8) serves as the proponent of the APGM, and coordinates with the other co chairs of the PPBC and other members of the PPBC throughout the staff process. The APGM is published following the POM Off-Site, but not later than mid-January, each year. Specific technical guidance will be published during the PPBE process, as required (e.g., capturing senior leader decisions; etc.). 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Army Campaign Plan (ACP)
TAP – Section V Army Campaign Plan (ACP) Establishes and monitors annual priorities and initiatives from the Secretary and Chief of Staff, Army Composed of Strategic Efforts, an Operational Design, Strategy Map and a published document Army Campaign Plan (ACP) - The purpose of the ACP, section V of TAP, is to establish and monitor annual priorities and initiatives from the Secretary and Chief of Staff, Army that require measurable endstates or decisions in the year of execution. The ACP is composed of Strategic Efforts (SE), an Operational Design, Strategy Map and a published document. The ACP document describes two distinct, but interrelated, efforts. The Strategic Efforts identify priorities and initiatives that require integration across the Army and assist in aligning objectives, resources and time. Generally, no more than six SEs will be identified for execution in a single Fiscal Year (FY). The first Strategic Effort of each year will be the 1-N prioritization Rehearsal of Concept (ROC) Drill, led by the DCS, G-3/5/7. The outcomes of the 1-N ROC Drill are the approved Army Priorities, 1- N list, and FY Endstate(s). Each endstate directly informs semi-annual performance assessments. As additional Strategic Efforts are executed, monitored and evaluated throughout the year, the ACP identifies key decision points for senior leaders and enables support for the strategic intent communicated in the AV and ASP. In addition to the current year synchronization of SEs, the ACP will facilitate performance assessment. Performance assessment forums, chaired by the Secretary and Chief of Staff, Army will be held semi-annually in the 2nd and 4th quarters to identify progress towards Strategic Effort #1 (1-N list) and FY endstates in terms of effectiveness (i.e.. outcomes) and efficiency (i.e.. prudent use of resources). Performance assessment reviews co-chaired by the Under Secretary of the Army (USA) and Vice Chief of Staff, Army (VCSA) will occur 90 days prior to the semi-annual briefings chaired by the Secretary and Chief of Staff, Army. The USA and VCSA will determine whether any Campaign Objectives (COs) and Major Objectives (MOs) will be briefed to the Secretary and Chief of Staff, Army. Other COs and MOs not identified as Army priorities in the ACP are directly managed by HQDA Principal Officials with oversight provided by the USA and VCSA as required. The DCS, G-3/5/7 serves as the proponent of the ACP and coordinates with HODA Principal Officials, ACOMs, ASCCs and DRUs, as required. The ACP is published not later than October 15 most years. In years when the AV and ASP are published, the ACP will be published within 60 days of their release to ensure that Strategic Efforts (SEs) align with senior leader strategic guidance.

Total Army Analysis (TAA)
Determines required Army capabilities through modeling and simulation 9 year planning horizon Primary inputs National Military Strategy Strategic Planning Guidance/Joint Programming Guidance Operational scenarios from Combatant Commanders Force Structure and equipment from Commanders Modernization actions from Program Executive Officers Primary outputs Required force structure Initial POM force structure Total Army Analysis is the Army’s process for objectively determining Army capabilities needed to meet the missions imposed by the National Command Authority. It uses guidance from the president, as published in the National Security Strategy and relayed to the Department of Defense in the National Military Strategy and the Guidance for Development of the Force/Joint Programming Guidance Develop, analyze, determine and justify a POM force, aligned with the GDF/JPG and TAP. The POM force is that force projected to be raised, provisioned, sustained, and maintained within resources available during the Future Years Defense Plan (FYDP) Provide analytical underpinnings for the POM force for use in dialogue among Congress, OSD, Joint Staff, Combatant Commanders and the Army. Assess the impacts of plans and potential alternatives for materiel acquisition, the production base, and equipment distribution programs on the projected force structure. Assure continuity of force structure requirements within the PPBE process. Provide program basis for structuring organizational, materiel, and personnel requirements and projected authorizations. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Check On Learning True / False. The National Military Strategy (NMS) provides fiscal guidance to the Army PPBE. Is the TAA part of the Army Plan? Q. Is the Army Strategic Plan (ASP) part of The Army plan? Q. Is Army Vision part of The Army Plan? How many part are there to The Army Plan? True / False. The DPG is the resource constrained guidance that the department of defense will exert during the POM period. True No Yes Yes Check on Learning NOTE: Conduct a check on Learning 5 True

Programming Phase Note: Refer students to page 5 of the PPBE summary sheet (paragraph 7) Total Army Analysis is the Army’s process for objectively determining Army capabilities needed to meet the missions imposed by the National Command Authority. It uses guidance from the president, as published in the National Security Strategy and relayed to the Department of Defense in the National Military Strategy and the Guidance for Development of the Force/Joint Programming Guidance Develop, analyze, determine and justify a POM force, aligned with the GDF/JPG and TAP. The POM force is that force projected to be raised, provisioned, sustained, and maintained within resources available during the Future Years Defense Plan (FYDP) Provide analytical underpinnings for the POM force for use in dialogue among Congress, OSD, Joint Staff, Combatant Commanders and the Army. Assess the impacts of plans and potential alternatives for materiel acquisition, the production base, and equipment distribution programs on the projected force structure. Assure continuity of force structure requirements within the PPBE process. Provide program basis for structuring organizational, materiel, and personnel requirements and projected authorizations. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Programming Phase (Cont.)
Definition of Programming: The art of translating guidance into action to produce combat capability by a balanced allocation of resources: How big will the Army be? (civilian and military) What forces will it contain? (force structure) What will the Army buy? (equipment) Where and what will the Army build? (MILCON) What are expected resource constraints? The 2nd Phase of PPBE is Programming -PPBE programming is the art of translating guidance into action to produce combat capability by a balanced allocation of resources. The Programming Phase is focused on the Army's key programming document, the Program Objective Memorandum (POM) and the DoD's action on each Service's POM request, the Program Decision Memorandum. The POM formulation and review process is one of the most all-encompassing activities within the HQDA. All activities require resources to function and perform their missions. The POM process is the vehicle through which these requirements are validated and resources are programmed in DoD FYDP. Balance is necessary since resource managers must address current and future requirements with limited time and funding. Balancing resources attends to a number of key questions concerning personnel strength, force structure, equipment, military construction priorities, and funding constraints. Programming is also known as the art of taking operational requirements and allocating resources to them to generate a balanced set of military capabilities. -While planning clarifies the requirements and objectives; programming tackles the hard work of resource allocation. Programming activities occur primarily at the Service and Defense Agency levels. At HQDA programming translates the DPG and TAP input into a comprehensive and detailed allocation of forces, manpower, and dollars for a six-year period. Through programming Army senior leadership allocates resources to support Army roles and missions. PPBE integrates and balances centrally managed programs for manpower; operations; research, development and acquisition (RDA); stationing (installations); and construction (MILCON). PPBE incorporates the requirements of ACOMs for manpower, operations and maintenance (O&M), housing and construction. -Recall that the primary product of the PPBS Planning Phase is the Guidance for the Development of the Force (GDF). The GDF presents the strategy underlying the DoD programs and identifies key planning and programming priorities for each Service to accomplish that strategy. -HQDA draws on the GDF (and other planning documents) to create the Army's key planning document, TAP. TAP establishes priorities for dollar and manpower allocation. These priorities directly impact Army force package resourcing decisions to meet readiness requirements. The goal of TAP is to provide relatively constrained guidance to Army programmers on the military capabilities required over the long (15-year) and mid (6-year) terms -Illustrate a program by using the following notional example. Assume the Army has determined there is a strategic and operational requirement to develop and field a new tank with increased capabilities. -It uses research, development, testing and evaluation (RDT&E) to develop the tank. HQDA must also program procurement dollars to produce the newly developed and approved tank. -To take advantage of the new tank's capabilities the Army must construct new ranges and motor pools or dramatically upgrade existing facilities. Therefore, programmers must include Military Construction, Army (MCA) funding. In addition, the new tanks fire an improved main gun round, requiring ammo production for basic loads, training, and war reserves. -Many other considerations enter the programmer's area of interest. Operations and Maintenance, Army (OMA) funding is needed to both field the tank and then sustain it, although O&M funding after fielding is covered in unit operations tempo (OPTEMPO) accounts. However, O&M is needed for the National Guard to overhaul and deploy the displaced tanks that flow to them. Note also that programmers also account for military and civilian personnel requirements including people in the Program Manager's office and fielding teams. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Prior year Current Year Budget year 5 POM Years We previously noted that PPBE is a continuous and repetitious process. A FY that is currently a PrY will become a BY in a future cycle, which later becomes a CY, and then a PY. For example assuming today's date is January 15, 2000, FY'03, currently a PrY, will become a BY on October 1, In addition, FY'03 becomes the CY on October 1, 2002 and a PY on October 1, While it is helpful to think of the sequential nature of the budget cycle, it is also important to note that the DoD focus is always on multiple PPBE phases. The MDEP is a multi-appropriation, multi-command, multi-year program package that competes for Army resources. For example the development of a new main battle tank requires funding from multiple appropriations, is fielded to multiple Army commands and takes many years from development to full fielding. MDEPs contain program, budget, and execution data. Programmers present new and existing programs requiring new or adjusted funding to Army resource decision makers using MDEPs. MDEPs address the PY, CY, and BYs data plus the five POM years of data for a total of eight years. The MDEP is the basic building block of the programming phase. It reflects force capability in terms of resources needed for implementation. HQDA introduces new programs as well as existing programs requiring increases or other adjustments through the use of MDEPs. MDEPs cover eight (8) years depending on whether you are looking at it from programming or budgeting perspective and where you are in the biennial cycle 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Management Decision Package (MDEPs) Six Resource Areas
Missions of MTOE units Missions of TDA units and Army-wide functions Missions of Installations Acquisition, fielding, and sustainment of weapon and information systems Special visibility programs (SVPs) Short term projects (STPs) The MDEP describes the particular program or function; specifies required manpower and dollars, and applies the data to one of six resource management areas. The first two areas relate to Army unit missions and force structure. First, deployable Army units are structured as Modified Table of Organization and Equipment (MTOE) units, for example is an armored battalion home-based at Fort Hood. The battalion is supported from Fort Hood but remains deployable. Second, non-deployable units performing standard functions are Table of Distribution and Authorization (TDA) units. For example, Fort Jackson's Soldier Support Center performs training and doctrine functions, but is not deployable. The third and fourth management areas reflect two critical Army support functions: installation platforms and equipment acquisition, fielding, and sustainment. The acquisition, construction, modification and sustainment of installations represent an essential but resource intensive Army function area. Likewise the acquisition, fielding, and sustainment of weapon and information systems is also costly but critical to the readiness of current and future forces. Finally, the fifth and sixth management areas are reserved for special visibility programs (SVPs) and short term projects. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

ACOM POM MDEP MDEPs Installation Level ARMY POM Army Commands, the Army Staff, and the Army Secretariat build and prioritize MDEPs displaying each category of resource required for each appropriation and each affected command. The ACOMs submit their prioritized MDEPs to HQDA in their own ACOM POM in accordance with guidance in the APGM. HQDA in turn prioritizes programs within the Army POM. The Army POM is a detailed plan of how the Army will distribute its expected resources (requested Congressional appropriations) across its many competing programs. The purpose of the ACOM POM is for submission and inclusion into the Army POM. The Army POM details resources over 5 years. It is the final Programming step. The Army POM depicts a balance between requirements and resources. The acronym ACOM is being used to include Army Commands (ACOMs), Army Service Component Commands (ASCCs) and Direct Reporting Units (DRUs) 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Program Evaluation Groups
(PEGs) PEG: Chair(s) Manning ASA (Manpower and Reserve Affairs) / G-1 Equipping ASA Acquisition, Logistics, & Technology / G-8 Training ASA (Manpower and Reserve Affairs) / G-3 Sustaining ASA (Installations & Environment) / G-4 Organizing ASA (Manpower and Reserve Affairs) / Installations ASA (Installations & Environment) / Assistant Chief of Staff for Installation Management After ACOM submits to the Army the first group the Army POM goes to is the PEGs. The CAPE assigns each MDEP to one of six PEGs. The Army Staff, Army Secretariat, and ACOMs build and prioritize MDEPs. The DA PEGs guide the prioritization process. The PEGs will initially evaluate and prioritize the MDEPs. According to the needs of the Army. Recall that within HQDA the PEGs are six working groups directly supporting the PPBE process in the manning, training, organizing, equipping, sustaining, and installations mission areas. These areas represent major SA responsibilities under Title 10, of the United States Code. Each is co-chaired by a representative from the Secretariat and the ARSTAF. The HQDA PEG proponents guide the prioritization of MDEPs within the fiscal and manpower ceiling established by the. Thus, some MDEPs, considered both critical and fully executable, receive high priority and remain protected from funding cuts. Other MDEPs exist in jeopardy of future resource cuts (resourced at risk) and still others go un-resourced. If additional funding is received, previously unresourced MDEPs receive funding. The objective of prioritization is to establish definitive force capabilities at specific funding levels. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

POM Building…The Process SA & CSA FINAL DECISIONS (Late May)
ACOM POMs Submitted Program Evaluation Groups UNRESOURCED Included UNRESOURCED (PEGs) meet: AT RISK UNRESOURCED * Cdr’s Program Assessments AT RISK RESOURCED UNRESOURCED * Assess Affordability AT RISK PROGRAMS RESOURCED * ACOM Exec Pgm Review Update AT RISK * Review ACOM inputs, U-CDR IPL PROGRAMS RESOURCED * Proposed $ realignments PROGRAMS RESOURCED * Draft program in 6 functional areas PROGRAMS * Summary Decrement Lists 6 Areas (Jan-Feb) (Dec-Jan) CoC/PPBC FUNCTIONAL REVIEW SLRG 3-Star BRP Review *Prioritize issues on the margin for presentation to ARB (Mid Apr) *Resolve resourcing issues *SA and CSA, as EOH Members, make final decisions. (Mid May) *Review PEG’s work *Clarify issues *Draft an affordable program (late Feb-Mid May) The POM process within the Army. The ACOMs submit their own POMs to HQDA with input to relevant MDEPS. The PEGs evaluate ACOM POM input, prioritize the MDEPs, and build a draft Army POM. The PBAT, BRPs and EOH in turn review the draft POM, refine for affordability and define issues. The SA, with the CSA’s recommendation, makes the final decision on the Army’s POM submission. Remember that programming via the POM process is the Army Senior Leadership’s method of allocating resources to support Army Roles and Missions. The Army POM is a detailed plan of how the Army will distribute its resources (Congressional appropriations) across its many competing programs. CHECK ON LEARNING Q: Which document, created by the Chairman, Joint Chiefs of Staff is used by the SECDEF to provide overall fiscal guidance to the PPBE process? A: NMS document Q: What are the four sections of the TAP? A: ASPG, APPG, APGM, and ACP Q: Which document reflects resource constrained guidance that the DoD will impose on the Army during the POM period? A: Defense Planning Guidance (DPG) SA & CSA FINAL DECISIONS (Late May) Submit POM to OSD 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Program Review–Typical Timeline
Aug Sep Oct Nov Dec 3-Star Programmers Reviews DMAG Reviews POM/BES Received OSD Identifies Issues Form Issue Teams and Develop Options OSD Issues PDM Army POM/BES submitted Army POM Briefs To OSD Army Forms Issue Teams Army Defends & Provides Issue Team Support Army Responds to PDM 3 Star Programmers Chair: Director, OSD PA&E Members: Principal Deputy, USD (Comptroller); Principal Deputy, USD (Policy); Principal Deputy, USD (AT&L); ASD (Force Management Policy; ASD (Health Care); ASD (Reserve Affairs); PDASD (NII); Director Operational Test and Evaluation; Army G-8; DCNO (Resources, Warfare requirements, and Assessments); USMC DC/S (Programs and Resources); USAF DC/S (Plans and Programs); J-8 (Director for Force Structure, Resources, and Assessment) Deputy’s Management Action Group (DMAG) Chair: DEPSECDEF Vice Chair: VCJCS Members: USDs (A&T, Comptroller, Policy, P&R, Intel) Service Under Secretaries; Service Vice Chiefs Observers: Principal Deputy Director, USD Policy ASD, NII/OSD CIO, Dir. PA&E, Dir. A&M, Principal Deputy Director, PA&E, J-8, J-5 The graphic lays out the flow of a typical Program Review. One thing to remember about a “typical” Program Review is that there are always small changes from year to year. However, certain events must happen each year so it is worth while to reviewing the process flow so the sequence of events can be explored. OSD and Army Issue teams work in parallel, with the Army team supporting the OSD team and advocating the Army position as required. Each OSD Issue team will assess the issues assigned to it and develop alternatives for decision. Army Issue teams will work with OSD to present the Army position on the assigned issue and keep Army leadership informed throughout the process. OSD Issue teams will brief alternatives and their evaluation of the alternatives – complex issues may be broken down into component parts requiring discrete issue papers or issue briefings. One thing that is immediately apparent is the notion of parallel processes. OSD is conducting the Program Review while the Services are readying a program defense. As can be seen from the graphic, service activities typically mirror OSD activities. Through out each step of the process, the services are trying to position themselves to respond to expected OSD questions and taskers, provide required reports, and offer best possible defense of their program position. CHECK ON LEARNING Q: What is a multi-year package containing execution, budget, and program data for a given program or function? A: Management Decision Package (MDEP) Q: True/False – Is the primary purpose of the ACOM POM to prioritize requirements for inclusion in the Army POM? A: True Q: What is the Army’s final programming document? A: Program Objective Memorandum (POM) Q: What period does the approved Army POM cover? A: Five years 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

PPBE Budgeting Phase Note: Refer students to page 7 of the PPBE summary sheet (paragraph 8) In the PPBE Budgeting Phase emphasis is on the Army's key budgeting document the Budget Estimate Submission (BES) and the DoD's action on each service's BES, the Resource Management Decision (RMD). Budgeting translates decisions in the PPBE Programming Phase into an appropriation format for Congressional action. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Budgeting Phase Formal phases of budgeting: Formulation Justification Short-range allocation of resources The major goal of budgeting is to maintain consistency with the POM To this end the Programming and Budgeting phases of the PPBE Process were integrated in 2003 Once we have an approved POM we move into the budgeting phase. In the PPBE Budgeting Phase emphasis is on the Army's key budgeting document the Budget Estimate Submission (BES) and the DoD's action on each service's BES, the Resource Management Decision (RMD). Budgeting translates decisions in the PPBE Programming Phase into an appropriation format for Congressional action. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL Justification Book Volume 1 Justification Book Volume 2

Army’s Overarching Objective
POM to BES: Army’s Overarching Objective The “big” decisions will be made during POM development … major programmatic issues will not be left unresolved when the POM is submitted From POM to BES, changes will be made only to … Fine-tune issues React to new information In other words: the POM = the BES To say that major programmatic decisions will be made during the programming phase might seem to be stating the obvious. But it is a lesson HQDA has learned painfully. There have been occasions when decisions on major issues were not made before the POM was submitted. Instead, the decisions kept being pushed downstream. This causes numerous problems, one of which is that when decisions are made late in the process, then budget analysts are left with insufficient time to prepare the detailed exhibits required by OSD, and the quality of the budget suffers. In addition to major decisions sometimes being delayed, it frequently happened in the past that an agency that didn’t like a decision made during the POM build would resurface the same issue during the BES process. This slide clearly says that this will no longer be allowed. To its credit, HQDA has done a pretty good job of adhering to this guidance. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Typical Timeline from POM/BES to President’s Budget (PB)
August-September: Army Submits POM and BES to OSD POM BES Program Review [CAPE] Budget Review [USD(C)] OSD Leads Two Parallel Reviews of the Army Submission The POM and BES are submitted in August/September to OSD – they follow parallel paths through the approval process. The PB, with essentially the same content, is finalized in January and will incorporate the results of the program and budget review. CAPE: Director of Cost Assessment & Program Evaluation (CAPE) PDM RMD OSD Issues Decisions PB January: Army Submits PB to OSD

Resource Management (RMDs) Prepared by DoD USD (C) Period: Prior Year, Current Year, and two Budget Years Provides decisions on approving or disapproving the service’s budget estimate submissions for inclusion in the President’s Budget Stated in dollars and manpower requirements Consolidated with PDM OCT 01 (no revisits) Remember we said that the BES was taking the POM and breaking it down into Appropriations. Its submitted to DOD who reviews and makes any corrections or changes to it. - Basically it is near term changes - Unexpected last minutes changes – will change how much we request to put into our appropriation (ex Sep 11, Price Changes) These are changes to the approved POM RMM (Summer Issue Cycle) - Used to be able to fight it out over old stuff – no more only new stuff - Now only changes due to changes in Price or Senior leadership changes - IE – SECDEF wants to fund this more or something new 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Command Budget Estimate
(CBE) Record activities to be conducted and resources needed for their support Identify action to be accomplished by each subordinate element Establish basis for measuring execution Document Unfinanced Requirements (UFRs) CBE Is actually making your budget – we will do this next week. CBE Based off of guidance in the BMG. CBE Initially done at Installation level. Submitted to MACOM who rolls it all up (Stops here – used to be submitted to DA). Make sure CBE = PBG 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Developing the Installation Command Budget Estimate (CBE)
ACOM CBE HQDA ACOM INSTALLATION CBE COMMANDER PBAC DRM MADs ACTIVITIES PREPARE PROGRAM BUDGET GUIDANCE (PBG) BUDGET MANPOWER GUIDANCE (BMG) DIRECTORATE OF RESOURCE MANAGEMENT (DRM) MAJOR ACTIVITY DIRECTORS (MADs) PROGRAM BUDGET ADVISORY COMMITTEE (PBAC) We are talking the initial phases of this chart – We’ll talk the later ones next week in budgeting / execution. Process starts with DA giving PBG to the ACOM. MACOM then gives BMG to the DRM at the Installation. DRM then provides BMG to the MAD’s and schedules a PBAC. Recommendations are made based on the PBAC and passed to the CG to make decisions on. CG provides his guidance to the DRM who passes the guidance to the MAD’s then they prepare their budget. This is then sent to the DRM for consolidation and then issues are ironed out at another PBAC. The final budget recommendation is then submitted to the CG for approval. This is the Installation CBE that is sent to the MACOM who uses it to complete their CBE. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Appropriation Structure
Military Personnel, Army (MPA) Operation & Maintenance, Army (OMA) Aircraft Procurement, Army Missile Procurement, Army Procurement of Weapons & Tracked Combat Vehicles, Army Procurement of Ammunition, Army Other Procurement, Army Research, Development, Test, & Evaluation, Army (RDT&E) Military Construction, Army (MCA) National Guard Personnel, Army (NGPA) Operation & Maintenance, Army National Guard (OMANG) Reserve Personnel, Army (RPA) Operation & Maintenance, Army Reserve (OMAR) Military Construction, Army National Guard (MCANG) Military Construction, Army Reserve (MCAR) Instructor note: Refer students to page 9 of the PPBE summary sheet, and > Army Funds Mgmt Data Ref Gd > Federated Enterprise Resource Planning Business Systems) Guide (AMS(F)G) > A0-2020: Operation and Maintenance, Army, or 2020 refers to an Operations and Maintenance, Army (OMA). DFAS-IN Regulation FY provides a full explanation of Army appropriation classification codes (example AO 2020). The DoD designs fifteen appropriation classification codes for Army major appropriations. Let’s look at the first three sets of code entries for these appropriations, for example 2020. A four-digit number indicates the type of funds being used. Military Personnel, Army (MPA), code 2010, signifies the payroll account for military and Department of the Army (DA) civilians. This appropriation makes up 60% of the Army budget and is available for obligation for one year. Thus Congress must pass a new MPA appropriation each year. It provides for pay, allowances, individual clothing, subsistence, and permanent change of station for members of the active component. Military Construction, Army (MCA), code 2050, has the longest available period of obligation for an appropriation, 5 years. It signifies appropriations for the acquisition of land and construction of buildings for which authorizing legislation is required. An appropriations bill authorizes the construction and the appropriation bill provides funding over a five-year obligation window. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Appropriation Definition
An act of Congress providing budget authority to incur obligations for a specified purpose and to make subsequent payments out of the treasury of the United States Appropriations are classified as annual, multiple-year, or no year We stated that the BES converts programs into appropriations. What is an appropriation? An act of Congress providing budget authority to incur obligations for a specified purpose and to make subsequent payments out of the treasury of the United States. An appropriation is Providing $ for the programs that have been authorized by the Congressional Authorization Act. Appropriations can be: Annual – 1 year to spend (OMA) Multiple Year – like MCA (5 years to spend) No year – revolving funds - carry over don’t expire 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Military Personnel, Army (MPA) 2010
Available for obligation for one (1) year Provides for pay, allowances, individual clothing, subsistence and permanent change of station for members of the active component MPA: 1 year availability Managed at DA Active MILPAY only Provides for pay, allowances, individual clothing, subsistence and permanent change of station for members of the active component. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Operation and Maintenance,
Army (OMA) 2020 Available for obligation for one (1) year Provides for the operation and maintenance of Army installations and major units to include equipment, facilities, supplies, and civilian pay OMA: 1 year availability This is the Bulk of the money most people deal with: - (Utilities / TDY / Training / Civilian salaries) Provides for the operation and maintenance of Army installations and major units to include equipment, facilities, supplies, and civilian pay. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

The Five Army Procurement Appropriations (PA) 2031 - 2035
Available for obligation for up to three (3) years Provides for the procurement, manufacture, and reconfiguration of aircraft, missile, weapons and tracked combat vehicles, ammunition, and other items to include spare and repair parts Procurement: 1-3 year availability (depending on what Congress states) $250,000 threshold – over $250,000 must use procurement $ Under $250,000 usually use OMA Provides for the procurement, manufacture, and reconfiguration of aircraft, missile, weapons and tracked combat vehicles, ammunition, and other items to include spare and repair parts. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Research, Development, Test and Evaluation (RDT&E) 2040
Available for obligation for two (2) years Provides for the development, engineering, design, purchase, fabrication or modification of end items, weapons, equipment or materials RDT&E: 2 year availability Research, Development, and Acquisition stuff Provides for the development, engineering, design, purchase, fabrication or modification of end items, weapons, equipment or materials. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Military Construction, Army (MCA), (MCAR), (MCANG) 2050, 2085, 2086
Available for obligation for five (5) years Provides for the acquisition of land and construction of buildings for which authorizing legislation is required MCA: 5 year availability Build or buy new facilities Provides for the acquisition of land and construction of buildings for which authorizing legislation is required. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

O&M, Army Reserve (OMAR) 2080, Army National Guard (OMANG) 2065 Available for obligation for one (1) year Provides for the operation and maintenance of the Army Reserve and National Guard to include training, administration, travel and transportation, communication and procurement of services, supplies and equipment OMAR & OMANG: 1 year availability Just like the Active’s 2020 OMA Funds the operations of the NG and Reserves Provides for the operation and maintenance of the Army Reserve and National Guard to include training, administration, travel and transportation, communication and procurement of services, supplies and equipment. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Budget Activities for OMA
There are four Budget Activity (BA) levels in OMA: BA 1 - Operating Forces BA 2 - Mobilization BA 3 - Training & Recruiting BA 4 - Administration & Service Activities Instructor note: Refer students to page 11 of the PPBE summary sheet The Army needs to track its money by appropriation. Each appropriation has its own breakdown. We will look at 2020 – OMA is broken down into smaller levels for tracking - The first being Budget Activities (BA) - 4 BA’s with OMA To Shift money between BA’s need to get approval at DA Lets look at BA 1 Operating Forces 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

BA 1 – Operating Forces Activity Group 11- LAND FORCES 111 Division Airborne Division 112 Corps Combat Forces 113 Corps Support Forces Activity Group 12 - LAND FORCES READINESS 121 Force Readiness Operations Support 122 Land Forces System Readiness 123 Land Forces Depot Maintenance Activity Group 13 - LAND FORCES READINESS SUPT 131 Base Operations Support 132 Real Property Maintenance 134 Unified Commands Subactivities (SAGs) OMA is further broken down by BAG’s and SAG’s (Budget Activity Groups / Subactivity Groups) - 1st digit is BA, 2d - BAG, 3rd - SAG EX: BA 1 - Operating Forces BAG 11 Land Forces (also have 12 Land Forces Readiness / 13 Land Forces Readiness Support) - 2d number: 1,2,3 are the BAGs- 11 - Land Forces - contains SAG’s SAG 111 Division (also have 112 Corps Combat Forces / 113 Corps Support Forces) Appropriations can get extremely specific to where the money goes (such , which means Airborne Division, 82d) Further down it goes the further specific it gets – reduces flexibility for the RM to move funds to cover needs. Guidance tells you normally what you can move but generally: MACOM’s can move money between BAG’s (in the same BA) Installations can move between SAG’s (in the same BAG) 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

BA 2 - Mobilization Activity Group 21 - MOBILITY OPERATIONS 211 Strategic Mobility 212 War Reserve 213 Industrial Preparedness 214 Army Preposition Stock (APS) 219 Reimbursable Another example: Money is used for mobilization stuff 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

BA 3 – Training & Recruiting
Activity Group 31 - Accession Training 311 Officer Acquisition 312 Recruit Training 314 Reserve Officers Training Corps (ROTC) 315 Service Academy Base Support Activity Group 32 - Basic Skill & Adv. Training 321 Specialized Skill Training 322 Flight Training 325 Base Support Activity Group 33 - Recruiting & Other Training & Ed. 331 Recruiting and Advertising 332 Examining 334 Civilian Education and Training 335 Junior ROTC 336 Base Support - Recruiting & Exam Some for BA 3: Fort Jackson gets a lot of 312 for Recruit Trng, 321 for Specialized Skill Trng and 325 for Base Support. 325 is Base support but it is Base Support money to specifically support training and mission of Basic Skill and Advanced Training. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

BA 4 – Administration & Service
Wide Activities Activity Group 41 - SECURITY PROGRAMS 411 Security Programs Activity Group 42 – LOGISTICS OPERATIONS 421 Servicewide Transportation 422 Central Supply Activities 423 Logistic Support Activities 424 Ammunition Management Activity Group 43 - SERVICEWIDE SUPPORT 431 Administration 432 Servicewide Communications 438 Base Support Activity Group 44 - SUPPORT OF OTHER NATIONS 441 International Military Headquarters 442 Misc Support of Other Nations Just another breakdown and the last for OMA: Only get funding for those areas that you have a mission (Base support only if doing Service wide Support) or 442 (Misc Support of Other Nations). 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Budget Process CONGRESS AUTHORIZATIONS APPROPRIATIONS PRESIDENT & OMB PRESIDENT’S BUDGET APPORTIONMENT The budget justification process presents, justifies, and defends the services’ and defense agencies BESs, as a portion of the President’s budget, to Congress. The Congress establishes budget limits, authorizes programs, and passes appropriations. Budget execution begins once appropriation bills become law and apportionment begins. Once BES is submitted and changes made through RMD All service budgets go to OMB Who consolidates and becomes presidents budget - Submitted 1st week of Feb Guidance comes back down to ACOM’s on changes Up to Congress and then back down Through Apportionment (Just splitting money up – initial distribution of funds) DEPARTMENT OF DEFENSE BUDGET ESTIMATES BUDGET EXECUTION 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Authorization vs. Appropriation
Authorization Bill: Authorizes programs. Specifies its general aim and conduct and unless “open-ended,” puts a ceiling on funds that can be used to finance it. Usually enacted before appropriation bill is passed Appropriation Bill: Grants the actual funds approved by authorization bills, but not necessarily to the total permissible amount under the authorization bill Authorization - Authorizes you to buy something - ie - The Army is allowed buy 10 tanks Appropriation - Actually given the money to buy the 10 tanks There are differences because 2 different committees, so funding in the appropriation may not be enough to buy all authorized – Ie - Auth 10 but App said 12 - buy 10 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Six Congressional Committees
House Budget Committee (HBC) Senate Budget Committee (SBC) House Armed Services Committee (HASC) Senate Armed Services Committee (SASC) House Appropriations Committee (HAC) Senate Appropriations Committee (SAC) Concurrent Budget Resolution (CBR) Defense Authorization Bills -Recall that the Constitution specifies that, “No money shall be drawn from the Treasury but in consequence of appropriations made by law.” Work on defense issues within the President’s budget occurs within 6 committees focusing on three separate but related objectives. Two committees, one in each house, craft a concurrent budget resolution establishing overall spending limitations. Two other committees manage the authorization process for defense issues. Finally, the House and Senate appropriation committees take action on thirteen appropriation bills that create budget authority for federal agencies. -An authorization act establishes or continues a federal program or agency, and includes compliance guidelines. Both the House Armed Services Committees (HASC) and the Senate Armed Services Committees (SASC) manage the authorization process for almost all defense related programs. While some authorizations are permanent, defense budget authority, procurement quantities, personnel end strength, and military construction projects usually require annual authorizations. The end product is the National Defense Authorization Act (NDAA). The OSD and services work closely with both committees as they craft the NDAA. -Work on authorization and appropriation bills occurs simultaneously. The House Appropriations Committee (HAC) and the Senate Appropriations Committee (SAC) manage the process through subcommittees focused on the 13 appropriation bills. Normally the DoD is concerned with only three of the 13 appropriation bills: Defense, Military Construction, and Energy and Water Development. -All appropriation bills originate in the House. A bill prepared in an appropriation subcommittee must be approved by floor action of the full House. In addition, appropriation bills may not exceed the ceilings set in the CBR without a 60% vote of Congress. When the revised bill is agreed to, Congress sends it to the President for approval or veto. The passage of an appropriation act triggers the final phase of the PPBE, budget execution. -Within the Army, the two major phases of budgeting are formulation and justification. While submission of the BES culminates the formulation phase, Army personnel continue to justify the BES within DoD, OMB, and Congressional committees until the appropriate appropriation and authorization bills are passed and signed into law. 13 Appropriation Bills 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Steps to a Bill Becoming Law
HOUSE SENATE Subcommittee Defense Committee HAC, HASC House Vote Subcommittee Defense Committee SAC, SASC Senate Vote Budget Justification Mark Up House Vote Senate Vote President signs House and Senate have similar committees working simultaneously. Both have Defense Subcommittees and both have Armed Services and Appropriations Committees. Different committees may call on testimony - support President’s budget House Committee puts together the Authorizations and/or Appropriations Act. Committee agrees and then it gets a vote. Then sent to Senate Committee who marks it up agrees and then sends it to the Senate for a vote. Then goes to a joint committee to work out issues within the House and Senate - get approved. Joint Committee works differences between the 2, then sent back to house and senate floors for vote to approve. Then sent to the President for signature. CHECK ON LEARNING Q: What is the final budget document that the Army turns into DoD? A: Budget Estimate Submission (BES) Q: What is a major goal of the budgeting phase? A: Maintain consistency with the POM Q: What database does OSD use to manage manpower and dollars? A: The Future Years Defense Program 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

PPBE Execution Phase Note: Refer students to page 8 of the PPBE summary sheet (paragraph 9) PPBE EXECUTION PHASE 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

PPBE Execution Phase (Cont.)
PPBS Included Execution within the three stages of budget formulation: budget justification, and budget execution PPBE Added execution as a formal phase Under PPBS, execution activities are included within the three stages of budget formulation: budget justification, and budget execution. In 1981 the Army expanded PPBS to PPBE adding execution as a formal phase. This activity looks at the flow of funds for program execution and two overarching responsibilities: compliance with guidance and performance measurement. It also discusses how the DoD and the Army manage change during the current execution year. 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Two Critical Execution
Responsibilities Compliance: Did we comply with the planning, programming, budgeting guidance as approved by Congress? Performance Measurement: Did we get the expected results? TWO CRITICAL EXECUTION RESPONSIBILITIES 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Flow of Funds Submits a Budget CONGRESS APPROPRIATES TREASURY OMB OSD APPORTIONS The Execution Phase carries out the decisions of the planning, programming, and budgeting phases. It must address guidance provided by Congress, OMB, the SECDEF, and the SA. Inherent within program execution and mission accomplishment are two critical responsibilities: compliance with higher guidance and performance measurement. Congressional compliance: Over time Congress created numerous acts governing the availability of budgetary resources and program execution. One key act is the Anti-Deficiency Act. This act prohibits obligating or spending more money than has been appropriated, except as authorized by law. Commanders and resource managers must comply with purpose, time, and amount limitations. They may only obligate and expend funds for purposes authorized in legislation and within the specified obligation and expenditure periods. Finally, obligations and expenditures may not exceed amounts established by law. While the Anti-Deficiency Act outlines individual responsibilities, the Chief Financial Officers Act (CFO) of 1990 increased the requirements for accountability over budgetary and other resources and enhanced operational financial controls at the OSD and HQDA levels. This act enhanced the authority and broadened the responsibilities of the U.S.D(C), and the ASA(FM&C). The Federal Manager’s Financial Integrity Act (FMFIA) of 1982 holds federal managers responsible to establish management controls. Specifically controls must ensure obligations/costs comply with the law and that programs are efficiently and effectively executed. This law also requires managers to protect resources, ensure revenues and expenditures are properly recorded; and make certain that accounting systems comply with the General Accounting Office (GAO) guidelines. -One additional act provides a transition into the second key area of execution responsibility, performance measurement. In 1993 Congress strengthened existing guidance on performance measurement by passing the Government Performance and Results Act (GPRA). The GPRA requires agencies to define long range-term goals, set performance targets, and report actual performance. -Supported by the PPBE process, the DoD and the Army meet Congressional requirements. Periodically throughout the year, activities conduct reviews and provide reports. -The ASA(FM&C)’s Quarterly Army Performance Reviews (QAPR) which is briefed to the Army Resources Board (ARB) is one example. The QAPR compares program performance with objectives set at the beginning of the fiscal year by the Secretariat and ARSTAF staff principles in line with the TAP. These reviews provide both a means of checking systems performance and a means to identify requirements within the Army POM within the PPBE current year (CY), budget years (BYs), and program years (PrYs). -While compliance and performance measurement are essential, budgets must also respond to unforeseen change. Changing world events, political commitments, and cost adjustments change projections and force adjustments. Congress allows carefully controlled reprogramming actions and necessary supplemental appropriations. The Defense Resources Board (DRB) may direct limited reprogramming - shifting funds within the same appropriation. Congress and OMB govern such action. Supplemental appropriations are Congressional responses to fund critical requirements surfacing outside the normal budget cycle. -Once budget authority has been appropriated by Congress and apportioned by OMB, DoD allocates funding to the Services and Defense Agencies, which then execute the funds by committing, obligating, expending, and outlaying them. During execution, financial managers must be aware of the rules governing the life of appropriations and avoid violating fiscal laws (anti-deficiency, misappropriation and bona fide need) while making efficient use of their budget authority, which is usually evaluated based on performance relative to obligation and expenditure plans. Failure to execute funds according to plan usually results in their loss to fund some other requirement. If funds originally appropriated for one program or purpose need to be redirected to another program or purpose, DoD must comply with the reprogramming rules established by Congress. ISSUE WARRANTS HQDA Major Commands / Agencies 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Check On Learning True / False. A MDEP is a multi year package containing past, current and projected future program financial data. Q. How do ACOM’s submit and prioritize Major Command resource requirements and MDEPs to be included into the Army POM? True / False. The POM covers a 6 year period. True / False. The POM identifies resources for a specific program? Q. What is the final budget document that the Army turns in to DoD? What data base does OSD use to manage manpower and dollars? True Through the ACOM Field POM False Check on Learning NOTE: Conduct a check on Learning False (BES) Budget Estimate Submission FYDP

Terminal Learning Objective
Action: Conditions: Standard: Identify the stages of the PPBE process within the DoD and DA. Given a summary sheet containing AR 1-1, DFAS-IN Manual FY, DA PAM 5-3, and slides. With 80% accuracy: Determine the stages, players, and concepts of the Planning, Programming, Budgeting, and Execution (PPBE) process within DoD and DA. Terminal Learning Objective 12/9/2018 FINANCIAL MANAGEMENT SCHOOL

Planning, Programming, Budgeting, and Execution

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