1. www.bea.gov BEA’s Budget: Setting Priorities in the Face of Tight Budgets Brian C. Moyer BEA Advisory Committee Washington, D.C. May 11, 2012

2. www.bea.gov Current Budget Environment  Department strongly supports BEA’s mission, but budgets are extremely tight and cuts are likely  BEA needs to continue producing its core statistical products  “Flat” budgets in even a mild inflationary environment erode base funds  BEA’s building lease expires in FY 2013 2

3. www.bea.gov BEA’s FY 2012 Budget: $92.2 m 3 Industry—$13.2 m (14%) Regional—$16.3 m (18%) International—$31.7 m (34%) National—$31.1 m (34%)

4. www.bea.gov Spending by Category People (69%) Data contracts (2%) Rent (7%) IT (8%) Overhead, other charges (12%) Training (2%) 4

5. www.bea.gov Within-budget Improvements  Prototype quarterly GDP by industry statistics  Work with BLS on an industry-level production account  New quarterly tables that reconcile BEA’s data with the Fed’s flow of funds data  New quarterly IIP estimates  Work on new quarterly GDP by state statistics 5

6. www.bea.gov Improvements in Efficiency 6  Modernization of IT systems  Allows BEA to complete more work with fewer staff  Improves timeliness of the data  Reduction in administrative costs  Savings of $600 k in FY 2012  Expansion of electronic filing for BEA surveys  Buyouts/early outs

7. www.bea.gov Performance/Zero-based Budgeting ▪ Budgets begin at “zero” and each program/product is analyzed by its resource costs and expected results ▪ Two-step process  Identify, collect, and analyze cost information on each program/product  Set priorities among programs/products in consultation with customers and stakeholders 7

8. www.bea.gov Past Cuts to BEA’s Programs ▪ Discontinued short and long-term macro forecasting units ▪ Transferred Leading Indicators to the Conference Board ▪ Discontinued regional projections ▪ Discontinued benchmark capital flow tables ▪ Discontinued FDI surveys, raised reporting thresholds, and reduced the level of detail collected on BEA’s surveys of MNCs ▪ Reduced the level of industry detail provided for county personal income 8

9. www.bea.gov “Menu” of Potential Future Cuts ▪ Eliminate advance GDP by industry statistics ($1.1 m) ▪ Eliminate county and metro area personal income statistics ($2 m) ▪ Eliminate monthly estimates of personal income and outlays ($2.3 m) ▪ Dramatically scale back projects to modernize the accounts such as better measures of health care inflation ($3 m) ▪ Reduce detail, periodicity, and analysis of FDI/MNC data ($5 m) 9

10. www.bea.gov “Menu” of Potential Future Cuts ▪ Discontinue “underlying detail” tables for GDP and the national accounts ($400 k) ▪ Discontinue RIMS program ($1.4 m) ▪ Discontinue travel and tourism statistics (net $150 k) ▪ Discontinue paper publications ($180 k) ▪ Scale back the IT modernization and systems reengineering ($3 m) 10