Understanding the federal budget process

February 18, 2014       The NonProfit Times      

The federal budget process can be Byzantine and confusing, but knowing how it works can help secure a federal grant for your organization. M. Linda Wastyn, president of Davenport, Iowa consulting firm Wastyn and Associates, and Robert Bradner, a partner at law firm Holland and Knight in Washington, D.C., boiled the process down for attendees of the Grant Professionals Association 2013 National Conference in Baltimore, Md.

Step 1: The President of the United States proposes a plan. Federal agencies develop requests, the Office of Management and Budget reviews the requests and sets funding parameters, and the budget is submitted to Congress (generally) during the first week of February.

Step 2: Congressional Budget Resolution. The House and Senate review and hold hearings on the president’s budget. They break spending into 20 broad “functions” or categories. Both adopt resolutions and try to hammer out their differences by April 15. The final Conference Report is not sent to the president because it is not a law.

Step 3: Appropriation bills and reconciliation bill. First the bills are divided into 12 separate bills (agriculture, defense, transportation, etc.). Appropriations bills must be originated in the House of Representatives, according to the U.S. Constitution. After committee markups, a floor vote and conferences between the House and Senate, the bills are sent to the President to sign off or veto the bills.

Wastyn and Bradner also shared budget realities, some of them sobering.

  • Deadlines are seldom met;
  • Appropriations spending limits are often breached; war spending and emergency spending do not count toward the limits; and,
  • Missed deadlines and temporary funding for part of the year have become the norm in recent years.
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