1. NSF Budget Process MPS Advisory Committee April 4, 2003

2. Budget Mission To provide the process by which quality analysis results in: (1) budget justifications that represent and communicate the mission and goals of the Foundation (2) budget implementation that reflects the intent of the Foundation, the Administration, and Congress National Science Foundation

3. Budget Responsibilities PROGRAM ANALYSIS êBudget Formulation for Science Directorates êSpecial Analyses & Charts êCongressional Testimony, Briefing Materials, Qs&As êClearance of Program Announcements & other documents êGPRA BUDGET OPERATIONS AND SYSTEMS êBudget Formulation for Administrative Offices êBudget Tracking & Execution êSpecial Analyses & Charts êEnterprise Information System/Budget Internet Information System êTechnical Budget Materials & OMB Data Entry

4. Spending America’s Income Broad revenue and spending categories in President Bush’s fiscal 2004 budget: Where it comes from (receipts) $1.9 trillion How it would be spent (outlays) $2.2 trillion Individual income tax: $850 billion Corporate income tax: $169 billion Payroll tax: $765 billion Excise tax: $71 billion Estate and gift tax: $23 billion Customs duties: $21 billion Other: $39 billion $493 billion: Social Security $429 billion: Discretionary (non-defense) $390 billion: National defense (discretionary) $255 billion: Medicare $176 billion: Interest on debt $185 billion: Medicaid $301 billion: Other Deficit: $307-$322 billion (with adjustment for revenue uncertainty) $2.2 trillion

6. The Long Path to a Federal Budget The president’s budget is not binding and is considered the administration’s proposal and request. With it comes volumes of information, including budget justifications from each agency that help Congress complete its own budget. The president’s budget generally is submitted by the first Monday in February. The House and Senate budget committees develop their own versions of a budget resolution. If the traditional schedule holds, both are developed by early April, and the leading budget committee members from both chambers develop a consensus agreement called a conference report that is typically adopted in April/May. The two chambers arrive at a concurrent budget resolution, which is not formally a law and does not require the president’s signature. However, the House and Senate have enforcement procedures to ensure directives are met. The budget resolution sets in motion legislation that, when enacted, has the force of law. Appropriations bills cover the discretionary portion of the budget and don’t affect mandated benefit programs such as Social Security and Medicare. Two or more of the appropriations measures can be lumped into a single omnibus appropriations bill. All of the bills must be signed by the president to become law. Another portion of the funds goes to authorizing committees for entitlements and other mandatory spending. To change these amounts, laws must be rewritten and voted on in reconciliation legislation, which requires presidential signature to become law. If all 13 appropriations bills aren’t signed by Oct. 1, the start of the new fiscal year, Congress may pass a continuing resolution to fill the gap. If Congress fails to pass the resolution or the president vetoes it, nonessential activities in government are shut down until appropriations for them are enacted. February June through SeptemberMarchAprilMay House Budget Committee formulates budget resolution Senate Budget Committee formulates budget resolution Budget conference committee reports out the concurrent resolution of the budget. House floor votes Senate floor votes House votes on 13 separate appropriations bills. House votes on reconciliation. House votes on conference report. House votes on reconciliation. Senate votes on 13 separate appropriations bills. Senate votes on conference report. Senate votes on reconciliation. Senate votes on reconciliation. Concurrent budget resolution reached. House authorizing committees report changes in law to comply with budget resolution. Senate authorizing committees report changes in law to comply with budget resolution. House Appropriations Committees reports spending measures to comply with budget resolution. Senate Appropriations Committees reports spending measures to comply with budget resolution. House authorizing committees recommendations submitted to Budget Committee. 13 conference committees Senate authorizing committees recommendations submitted to Budget Committee. Budget reconciliation conference committees. President signs or vetoes appropriation s bills. House floor votes Senate floor votes Presiden t submits his budget proposal to Congress.

7. Defense Energy Agriculture Transportation Education Justice Housing &Urban Development EPA NRC NSF Veterans Affairs Labor NASA Departments & Agencies Development of the Federal R&D Budget Showing Fields of Science and Executive and Legislative Decision Units Engineering Physical Sciences Environmental Sciences Life Sciences Psychology Social Sciences Other Sciences Fields of Science National Defense Affairs International Energy Agriculture Transportation Health Budget Review Offices (OMB) House & Senate Budget Committees (Budget Functions) Agriculture & Related Agencies Commerce, Justice, State, Judiciary Energy and Water Development Foreign Operations VA-HUD-Inde- pendent Agencies Interior Labor, Health & Human Services, & Education Transportation & Related Agencies Defense House and Senate Appropriations Subcommittees Armed Services Labor and Human Resources Banking, Housing & Urban Affairs Foreign Relations Veterans Affairs Senate Authorization Committees Energy & Natural Resources Environment & Public Works Commerce, Science, & Transportation National Security Economic & Educational Opportunities Banking & Financial Affairs International Relations Veterans Affairs Commerce Resources Transportation & Infrastructure Science Agriculture Agriculture, Nutrition, & Forestry House Authorization Committees (With significant R&D $) Judiciary International Science, Engineering and Technology National Security Science Technology Math & Computer Science Agency for International Development Commerce Health & Human Services Interior National Security & International Affairs Natural Resources, Energy, and Science Economics & Government Human Resources, Veterans, and Labor General Science, Space & Technology Natural Resources & Environment Commerce & Housing Credit Community & Regional Development Education, Training, Employment, & Social Services Veterans Benefits & Services Administration of Justice National Science and Technology Council Research Committees Connecting lines indicate location of agency budget decisions, but not decision sequences. Environment and Natural Resources Environment and Natural Resources

8. NSF BUDGET YEAR February 2003: Budget to Congress (04) March/April - Hearings (04) March - June Planning (05) (OMB/OSTP Guidance) May NSB: Budget Discussion (05) May –July: Budget Calls / AD Retreat / PARTs (05) June – AC/GPA (03) August NSB: OMB Budget Approved (05) September - OMB Submission (05) / Close Out (03) October - Current Plan (04) / OMB Hearings (05) Thanksgiving – OMB Passback (05) December - Appeal/Finalize (05) February 2004: Budget to Congress (05)

9. NSF Budget and Planning Cycle Oct, ‘02 NovDecJan, ‘03 FebMarAprMayJuneJulyAugSepOct, ‘03 NSB Activities NSF Activities Complete FY 2004 Budget Director’s Policy Group Retreat; Major Research Equipment Review; Examining Priorities Scenario Planning for FY 2005 Develop FY 2005 Budget Submit FY 2005 Budget to OMB Planning Environment Issues Analysis; Guidance on Establishing Priorities Principles Governing FY 2005 Budget NSB Attention to FY 2005 Budget Approve FY 2005 Budget

10. Budget and Planning Cycle Oct ‘03 NovDec Jan ‘04 FebMar Apr MayJune JulyAugSepOct ‘04 Prepare OMB Request OMB Oct ‘02 NovDec Jan ‘03 FebMar Apr MayJune JulyAugSepOct ‘03 OMB ReviewPrepare BudgetCongressional Hearings / Budget Resolution / Bill Long Range Planning Establish Operating Plans ReviewPrepare BudgetCongressional Hearings / Resolution / BillOP Plan FY 2004 FY 2005 FY 2003 Establish Operating Plans Operating PlansImplement Programs

11. Key Budget Planning Tasks

12. Input to Planning Process

13. Assessment/Accountability êGPRA 1993: Congress (law) êPMC/PMA 2000: President/OMB êPART 2001: OMB: Numerical Measurement êR&D Criteria 2002: NAS/OSTP/OMB