1. Federal Budgeting
101
Susan Shuback Executive Director for Budget U.S. Customs and Border Protection

2. Budget 101 Objectives
To understand and be able to articulate the various phases of the planning, programming and budgeting processes
To understand key decision points in the budget process and the deliverables for these points
To understand the roles and responsibilities of Congress, the Office of Management and Budget (OMB), Department/Agencies

3. The Budget Cycle Planning, Programming, Budgeting & Execution (PPBE)
The PPBE is a cyclical process
consisting of four distinct but interrelated phases:
Planning
Establish strategic priorities and capabilities required to achieve the strategy
Programming
Apply the resources to programs that provide the capabilities required to achieve strategic priorities
Budgeting
Properly price the programs, develop justifications, and an execution plan
Execution
Perform and monitor the spending of approved plans

4. Budget Formulation Process
Multiple cycles of Planning, Programming,
Budgeting, and Execution (PPBE) are underway at any one time
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
FY 2014-
2018
FY 2013-
2017
FY 2012
FY 2011
Annual Financial Report
Agency/Department Planning Phase
Decreasing Flexibility to Adjust/Change
Internal Agency Program or Outyear Budget Process
DHS: Resource Allocation Plans (RAP)
Budget to OMB
OMB Passback
Budget, APR, FYHSP to Congress
Hearings, Testimony
HAC/SAC Conference & Bills
Appropriations Act
Mid-year Reviews
Reprogramming Requests to Congress
Dec

5. Agency Planning Process DHS: HSTA and Integrated
The Outyears Planning
Agency Planning Process
DHS: HSTA and Integrated
Planning
Guidance
May-June October-November

6. Planning in DHS The Homeland Security Threat Assessment (HSTA), May-June Integrated Planning Guidance (IPG), October-November
HSTA A strategic assessment of the major threats for which DHS must prepare and respond to in the next five years.
IPG Provides a framework to manage DHS resources effectively; consistent with the National Strategy and DHS’ strategic plan. It provides a projected operating environment for the next five years.

7. The Budget Year +1 Programming
Resource
Allocation
Plans (RAPs)
Budget to
OMB
OMB
Passback
Internal Agency Program or Outyear Budget Process
February-March April-May May-July July-August September October-December

8. Internal Agency Program or Outyear Budget Process and DHS’s Resource Allocation Plan (RAP) Process February-August, BY +1
The DHS RAP is the component-specific budget requests that span a five-year time period ( )
In late winter/early Spring DHS Issues RAP guidance- includes fiscal levels for each component, and process guidance
For example: no new programs in FY 2013 or office must fund all new programs within their base budgets
DHS Components make recommendations for maintaining and/or adjusting the budget to reflects costs and priorities of the component.
DHS and Component leadership deliberate and make decisions
May include adjustments with and between components
Decisions are reflected in the OMB Budget Submission

9. Budget to OMB September, Budget Year +1 (FY 2013)
Submitted to OMB, generally by the first Monday after Labor Day
Represents Department/Agency’s recommendations for funding to the Administration
Includes most of the same materials that will eventually go to Congress
Draft or “Dress Rehearsal” of the Congressional Justification
Includes changes in costs, recommendation for starting new or terminating old programs
Includes changes in performance measures

10. OMB Passback November-December, BY +1 (2013)
Includes recommendations to the President and senior advisors on each agencies proposed budget policies
Ensure budgets are aligned with the administration’s priorities, program performance goals and budget constraints
Develop economic and budget assumptions for each area which will ultimately drive programmatic and budget decisions
OMB passes back the President’s budget decisions to agencies
Agencies/departments can appeal budgetary decisions if there are disagreements
If OMB and agency cannot reach agreement, the issue may be taken directly to the Vice-President
Prepare impact statements/appeals for OMB cuts or disapprovals for programmatic changes
These are prepared both by the Budget Office and Program Offices

11. The Budget Year Budgeting
HAC/SAC
Conference
and Bills
Appropriations
Act
Budget to Congress
Congressional
Hearings,
Testimonies
January- February March- April May- June September-November

12. Budget to Congress January-February, BY
The President’s Budget is transmitted to Congress on the first Monday in February; also known as the Congressional Justification (CJ) Submission
Process includes:
Input into government-wide budget database (MAX) for all dollars/numbers
Narrative submission to Congress including all changes to the base budgets and new initiatives
CBP’s document is over 400 pages long includes over two dozen separate funding exhibits for costs such as salaries, contracts, rent, capital investments etc.
Official external messaging: Development of Press Roll-Out materials, review of DHS Secretaries Budget announcements, and the Secretary’s Statement for the Record
Annual Performance Review– high level document which highlights agencies and organizations accomplishments against strategic goals

13. Hearings, Testimony & Conference March-June, BY
Congress sends up a nonbinding budget resolution for the President
This establishes guidance on the level of budget authority, outlays, surplus or deficit, revenue, and debt
May request the Secretary and the heads of agencies to testify before committees on the Budget Request. Requests are mostly made by the appropriation committees.
The House and Senate resolve any differences in their respective bills in a special conference committee made up of members from both legislative bodies. Once compromise has been reached, Congress adopts the budget resolution concurrently.
Departments and Agencies also write briefing papers; coordinate responses to advance questions; answer Questions for the Record (QFRs); prepare transcript inserts, and help identify and assign reporting requirements

14. Appropriations Act September-October, BY
An Appropriations Bill provides the legal authority needed to spend or obligate U.S. Treasury funds. The appropriation bill must be enacted prior to the start of a new fiscal year (October 1). Failure to meet this deadline causes the need for temporary short-term funding (Continuing Resolution), or results in a federal government shut-down.
House and Senate appropriation committees meet independently to consider 12 appropriations bills
Both houses “Conference” to resolve outstanding differences
If the President signs the legislation, it becomes law
The appropriation acts establish the three main components of the appropriation: time, purpose, and amount

15. The Current Year Execution
Reprogramming
Requests
to Congress
Annual
Financial Reports
Mid-year Reviews
March-April May-June October-December

16. Mid-year Review March-April, Current FY
Mid-Year reviews occur is most federal agencies and are used to provide agency/department leadership with a snapshot of financial resources at the halfway point of the fiscal year
Provide an analysis of budget and spending activities against financial plans, staff plans and projection methods to ensure effective prioritizing and utilization of resources in support of CBP mission and goals
Are often used to measured against performance goals
May include a review of unfunded requirements, new initiatives or changes in costs assumptions or priorities.

17. Reprogramming Requests to Congress May-June, Current FY
Reprogramming occurs when funds within an appropriation or fund account are shifted and used for purposes other than those designated at the time of the appropriation decision. Reprograms should only be made to meet urgent and unavoidable requirements, not to procure desirable items.
Various authorizing statutes provide other limitations for reprogrammings. For example in DHS no reprogramming can increase an appropriation by more than 10% or decrease an appropriation by more than 5%
Agencies most notify Congress when reprogramming funds:
Create or eliminate a program, project, office or activity
Increase funds of a program, project, or activity that were denied or restricted by Congress
Repurpose funds that were specified by Congress to go towards a stated purpose
Contract out any function or activity for which funding levels were requested for Federal full-time equivalents

18. Annual Financial Report October-November, Current FY
Provides annual financial information adheres to standards and guidelines in manner consistent across federal government
Includes component statements and performance metrics to report agency efficacy in meeting mission and objectives
Provide a hierarchy of objectives and landscape of financial resources

19. Other Terms in Budget
Apportionment: is a plan, approved by OMB, to spend resources provided by one of the annual appropriations acts, a supplemental appropriations act, a continuing resolution, or a permanent law (mandatory appropriations). Resources are apportioned by Treasury Account Fund Symbol (TAFS). The apportionment identifies amounts available for obligation and expenditure. It specifies and limits the obligations that may be incurred and expenditures made (or makes other limitations, as appropriate) for specified time periods, programs, activities, projects, objects, or any combination thereof.
Obligation means a binding agreement that will result in outlays, immediately or in the future. Budgetary resources must be available before obligations can be incurred legally.
Commitment: An administrative reservation of funds for obligation. For example when an organization goes out with a request for proposal on a contract, the funds are often “committed” or set aside.
Outlay or Expenditure: means a payment to liquidate an obligation (other than the repayment of debt principal). Outlays generally are equal to cash disbursements but also are recorded for cash-equivalent transactions, such as Federal employee salaries and debt instruments. Outlays are the measure of Government spending.