Deltek Insight 2012: The Ins and Outs of the Federal Budget

The Ins and Outs of the Federal Budget

Ray Bjorklund, VP and Chief Knowledge Officer, DeltekGC-430

2 ©2012 Deltek. All rights reserved.

About RayRay Bjorklund

BS, UC Davis

MS, Northrop Univ.

Research Fellow, Eisenhower School

DAWIA Level III

Joined Deltek April 2011

40+ years in Technology, Program Management, Consulting

FedSources, a Washington Management Group Company

Defense Information Systems Agency

Headquarters Air Force

Air Force Materiel Command

Air Combat Command

Army Training and Doctrine Command

Guides Deltek Information Solutions in use of market information

Provides subject matter expertise to consulting

engagements Analyzes public sector markets

Develops innovative methodologies for acquiring and

exploiting public sector data


Know key rules and processes of budget formulation and execution

Understand the differences among: Financing methods Appropriations types

Know how to follow the money to identify business opportunities

Objectives


Federal Fiscal Processes Are Complex

Extensive statutory and regulatory requirements

A very lengthy process Important control and feedback nodes Agency leadership Office of Management and Budget (OMB) Department of the Treasury Financial Management Service Congressional Appropriations Committees Comptrollers and contracting officers


The Appropriations Rules

U.S. Constitution

Government Accountability Office Red Book on appropriations law

Specific congressional bills Authorizations Appropriations Antideficiency Act (ADA), Pub.L. 97-

258 Duration of appropriations

Purpose for which appropriated Contingencies Reprogramming

The Budgeting Rules

White House policy and guidance

OMB Circular A-11

Agency financial management regulations

Treasury reporting

Get Familiar with the Rules


Congressional Appropriations

Budget resolution

Enacted legislation Authorizations Appropriations

Committee markups and reports

Conference committee reports

Continuing Resolutions

Comptroller General decisions

Congressional Budget Office estimates

Congressional Research Service reports

Executive Branch Budget

The Budget of the United States Government

Budget volume: the President's Budget message and other broad policy statements

Appendix: detailed information by agency, bureau or program group, budget accounts, programs and activities

Analytical Perspectives: analysis of special-interest topics

Historical Tables

Other volumes

Get Familiar with the Documents


Make Your Analysis Relevant

What is the top line budget?

Within the top line, what dollars are contractor addressable? Directly addressable Indirectly addressable

Within addressable budget, what dollars are contestable?

What’s the time phasing?

8

Total spend:$3.5T

©2012 Deltek. All rights reserved.

Mandatory (or direct) Set by permanent laws Includes entitlements and benefits

that must be paid Limited contractor addressability

Discretionary Controlled by annual

appropriations Permits some spending flexibility,

constrained by rules, legislated authorizations

Significant contractor addressability

Know Types of Spending

$1.3T$2.2T

Other spending

Contractor-addressable

spending

Most directly affected by Congress

Mandatory Discretionary

Note: Circles scaled relative to GFY 2013 budget


Integrate Your Business with the Money Trail

Develop and submit proposal

Bid?Develop and implement

capture strategyWin?

Earn past performance qualifications

Get paid?

Capture?Conduct

pursuit reviewIdentify and analyze targets

Authorizations and Appropriations

Planning Budget request

Disbursement and Outlay

Award and Obligation

Requirement and SolicitationApportionment and Allocation

Ear

ly

Sta

ge

Pre

-A

war

dA

cqu

isit

ion

P

erfo

rman

ce

Government

Contractor

Source: Deltek analysis

De-oblig?


Budget Formulation Takes 10+ Months

Submittal to Congress

Appeals

Presidential decisions

Data entry

Passbacks

OMB review

Agency submissions

OMB planning guidance


Will the Funding Be There?

Magnitude of spending Top line growth or decline rate Contractor-addressable spending

Spending pattern shifts Conversion of contract services to government payroll Spending declines due to functional consolidation Increased capital investments Grants and subsidies

Financing methods Shifts among discretionary and mandatory appropriations, and

offsetting collections Backlog of unobligated balances Use of pay-as-you-go (PAYGO)


What the Budget Tells Us

Program spend plan by activity

Budgetary resources Unobligated balances brought forward Appropriations (Discretionary and Mandatory) Offsetting collections (Discretionary and Mandatory)

Budget authority and outlays Discretionary Mandatory

Obligations plan Direct Reimbursable

Employment summary


USDA Agricultural Research Service Budget Request

Unobligated balance, SOY 2M$ Discretionary appropriations 1,103M$ Offsetting collections 127M$

Total budgetary resources 1,232M$ Unobligated balance, EOY 4M$

Gross outlays 1,262M$ Government salaries and benefits 724M$ Other expenses 33M$ Contractor-addressable obligations 333M$ Grants 13M$ Reimbursable obligations 125M$

Total new obligations 1,228M$

FINANCING AND SPENDING

27 percent addressable

Source: Deltek analysis of GFY2013 President’s Budget

Previous funding not spent on contracts or

other purposes

The “ask”

Estimated disbursements

Budget authority requested

Anticipated GFY 2013 new

spending on contracts and for other purposes


Some Points to Consider

Not all accounts expire at EOY

What can be purchased is specified by “color of money”

Budget authority not always equal to outlays

Budget authority not always equal to obligations

Addressable obligations not always equal to contractor revenue

Subsequent appropriations can change budget authority


Pre-decisional silence, until State of the Union address

Budget submission President’s budget message signals Executive Branch priorities Appendix volume shows spending plan, by account Agency-specific congressional justifications amplify account spending

plans

Congressional appropriations activities provide the vectors Congressional budget resolution sets targets Authorizations process Appropriations committee/subcommittee marks Conference Report complementing the appropriations bill summarizes

rationale for final dollar level Conference reports

Making Use of the Data


Summary

Get to know the meaning of the terms

Follow Executive Branch and Legislative Branch processes

Pay close attention to contractor-addressability

Don’t let political hype misdirect you

17 ©2012 Deltek, Inc. All Rights Reserved

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ADA – Antideficiency Act

DAWIA – Defense Acquisition Workforce Improvement Act

EOY – end of year

GFY – government fiscal year

OMB – Office of Management and Budget

PAYGO – pay-as-you-go

SOY – start of year

T – trillion

USDA – US Department of Agriculture

Acronyms

Deltek Insight 2012: The Ins and Outs of the Federal Budget

Technology

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