OMB BULLETINS 1977

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP06M00944R000200080002-6
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 119
• Document Creation Date: December 27, 2016
• Document Release Date: July 17, 2013
• Sequence Number: 2
• Publication Date: August 25, 1977
• Content Type: REPORT

r1M11 01117 "OrriCr lkt. 77_1
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25 August 77
Distribution made 8/30/77:
STAT ? 1 - OGC Library,
I - AO/DCI
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EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. ?0503
BULLETIN NO. 77-12
August 25, 1977
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Additional Subfunction Coding of Decision Units
1. Purpose. This Bulletin provides instructions on
classifying, by additional subfunctions, zero-base budgeting
agency submissions. This information will be used to sort
decision packages so that related activities can be
reviewed.
2. Coverage. These instructions apply to all Executive
Branch agencies that are required to provide budget
submissions based on zero-base decision packages in
accordance with OMB Circular No. A-11.
3. Rep2rting req2irements. Agencies will prepare a report
on raditional subTunctions, in the format of Exhibit 1, for
each decision unit submitted to OMB. The reports will be
prepared in accordance with instructions in Attachment A of
this Bulletin. They will accompany the decision unit
overview and set of decision packages that are submitted to
OMB in accordance with section 24.1 of OMB Circular No. A-
11
4. Classification of data. Attachment B provides agency
and bureau chapter codes, which are needed to complete the
report. Attachment C provides the titles and codes of the
functions and subfunctions shown in the most recent budget
documents. These will be used to identify the additional
subfunctions associated with each decision unit.
5. Rescission. This Bulletin is rescinded following
receipt of the subfunction coding, report (Exhibit 1).
6. Inquiries. Requests for assistance should be directed
to the Fiscal Analysis Branch, Budget Review Division,
Office of Management and Budget 395-4520 or 395-3930).
ert L
Director
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ATTACHMENT A
Bulletin No. 77-12
INSTRUCTIONS FOR THE PREPARATION OF MATERIAL FOR ADDITIONAL
SUBFUNCTION CODING OF DECISION UNITS
This Attachment provides instructions for the preparation of
the additional subfunction coding report. This report will
be submitted as a covering report with each decision unit
overview and set of zero-base budgeting decision packages
prescribed by.section 24.1 of OMB Circular No. A-11.
Agencies heVe'been instructed to identify for each decision
unit the budget subfunction representing the unit's primary
purpose. . In: the ncirmal budget usage, all outlays are
classified in the function and subfunction reflecting their
primary purpose. However, in this exercise we are asking
that the agency provide a covering report to identify other
functional/ '..for subfunctional categories that describe
additional (alternative) purposes served by the programs or
a major patt''Pf the program in each decision unit.
Two copies of the additional subfunction coding report will
be prepared on 8" x 10-1/2" paper in the format of Exhibit
1. The identifying information and blocks should be filled
out as described below.
Identifying information. Enter the following information to
TNEITTy TEe-5,257ET3E2T subfunction coding report. This
information Should agree with the identifying information
provided in the corresponding decision unit overview as
prescribed bli,section 24.1 of OMB Circular No. A-11.
,
Block 'A.: A22na Chapter Code. Enter the applicable
TWE=ai9lt agency chaTiler-ZEde-Ticim the list found in
Attachment B to this Bulletin.
Block B. Bureau Chapter Code. Enter the applicable
TWo-3igit buTeau Mapter code from the list found in
Attachment B to this Bulletin.
Block C. A2en,sy Decision Unit No. Enter the unique
TET-digit dcThxonTIETE-Fae resigt-ilted by the agency
pursuant to section 24.1 of OMB Circular No. A-11.
Block b4Decision Unit Budget Year Outlays. Enter the
agasioo4411-EaTet-Tar-37ISig- Tor tEe "cumulative
total" -eabmitted in the highest level decision package
accompanying the decision unit overview.
BlockE. Budget Subfunction Code. Enter the three-
amt coa- TOT -IFe-EIMEE subfunction of the decision
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unit. This code is the last 3 digits in the 11-digit
"identification code" for the account included in the
decision unit overview, except when the decision unit
Contains two or more accounts with different
sUbfunctions. In those cases, enter in this block the
subfunction code for the account having the largest
outlays.
Block F. Additional Subfunction Codes. Enter
adalTionil three-CI-Mit subfunaion codes -- up to a
maximum of five subfunctions -- that apply to all or
portions of the decision unit. If possible, the
additional subfunction codes should be in descending
order of magnitude of outlays. See Attachment C to this
Bulletin for a list of subfunction codes.
Reasons for additional subfunctions. Include in the space
proviBed a BescriptIon oT tbi-ieason(s) for assigning each
eddcit,id.On'al subfunction code listed. The description should
belaucCinct, as illustrated by the example in Exhibit 2.
The additional subfunctions identified should have a
si2nificant direct relationship to the program. For
example, Exhibit 2 illustrates the Operation of Indian
Programs account, which is primarily area and regional
development; hence its budget subfunction code is 452. The
additional subfunctions identified also have the following
direct relationship to the program's purpose:
.0.111
?????????
the public assistance and other income supplement
subfunction (code 604 in the income security
function) because of the welfare and housing
assistance provided to Indians;
the training and employment subfunction (code 504 in
the education, training, employment and social
services function) because of the training and
employment assistance provided to Indians;
the law enforcement assistance subfunction (code 754
in the law enforcement and justice function) because
of the law enforcement activities on Indian lands;
and
the other general government subfunction (code 806
in the general government function) because of the
assistance to Indian tribes for operation of tribal
governments.
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Ns.
ADDITIONAL SUBFUNCTION CODING
A.
Agency
Chapter
Code
B.
Bureau
Chapter
Code
C.
Agency
Decision
Unit No.
D.
Decision Unit Budget
Year Outlays (Highest
Cumulative Total) (In
thousands of dollars)
E.
Budget
Subfunction
Code
1
F.
Additional
Subfunction
Codes
...
2
3
4
5
6
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Descriptive reason for assigning additional subfunction codes above:
Subfunction code 2:
Subfunction code 3:
Subfunction code "
Subfunction code 5:
Subfunction code 6:
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N.)
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14,#
ADDITIONAL SUBFUNCTION CODING
Department of the Interior
Bureau of Indian Affairs
Operation of Indian Programs
(Area and Regional Development): 14-2100-0-1-452
ci
A.
Agency
Chapter
B.
Bureau
ChapterDecision
C.
Agency
D.
Decision Unit Budget
Year Outlays (Highest
E..
Budget
Subfunctiou
F.
Additional
Subfunction
Code
Code
Unit No.
Cumulative Total) (In
thousands of dollars)
Code
Codes
1
3'
5
6
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1
1 I 1
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1
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1
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1 0
7
6
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350,000
4
5 2
6 0 4
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4
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5
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Descriptive reason for assigning additional subfunction codes above:
Subfunction code 2:
Subfunction code 3:
Subfunction,code 4:
Subfunction code
Welfare and housing assistance for Indians.
Training and employment assistance for Indians.
Law enforcement on Indian lands.
5$Assistance to Indian tribes for operation of tribal governments.
Subtunction code 6:
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ATTACHMENT B
Bulletin No. 77-12
AGENCY AND BUREAU CHAPTER CODES
01-00 Legislative Branch:
05 Senate
10 House of Representatives
12 Joint items
14 Congressional Budget Office
15 Architect of the Capitol
25 Library of Congress
30 Government Printing Office
35 General Accounting Office
40 United States Tax Court
45 Commission on Security and Cooperation in Europe
45 Botanic Garden
45 Copyright Royalty Tribunal
45 Cost-Accounting Standards Board
45 Temporary Commission on Financial Oversight of the
District of Columbia
45 Office of Technology Assessment
02-00 The Judiciary:
05 Supreme Court of the United States
10 Court of Customs and Patent Appeals
15 CustoMs Court
20 Court of Claims
25 Courts of Appeals, District Courts, and other
judicial services
26 Administrative Office of the United States Courts
30 Federal Judicial Center
31 Space and facilities, the Judiciary
32 Expenses, United States Court facilities
34 Bicentennial expenses, the Judiciary
35 .Judiciary trust funds
03-00 Executive Office of the President:
05 Compensation of the President
10 The White House Office
20 Executive Residence
21 Official Residence of the Vice President
22 Special assistance to the President
30 Council of Economic Advisers
31 Council on Environmental Quality and Office of
Environmental Quality
33 Council on International Economic Policy
34 Council on Wage and Price Stability
35 Domestic Council
40 National Security Council
45 Office of Drug Abuse Policy
48 Office of Management and Budget
49 Office of Science and Technology Policy
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50 Office of the Special Representative for Trade
Negotiations
51 Office of Telecommunications Policy
57 Special Action Office for Drug Abuse Prevention
04-00 Funds Appropriated to the President:
02 Appalachian regional development programs
03 Disaster relief
05 Unanticipated needs
07 Expenses of management improvement
09 International security assistance
10 Indochina postwar reconstruction assistance
12 International development assistance
13 International narcotics control assistance
15 Contingencies
18 Israel-United States binational industrial research
and development foundation
20 Balance of payments loan for Portugal
25 Petroleum reserves
30 Emergency refugee and migration assistance
50 Public works acceleration
05-00 Department of Agriculture:
03 Departmental administration
18 Agricultural Research Service
21 Animal and Plant Health Inspection Service
24 Cooperative State Research Service
27 Extension Service
30 National Agricultural Library
32 Economic Management Support Center
33 Statistical Reporting Service
36 Economic Research Service
48 Farmer Cooperative Service
51 Foreign Agricultural Service
57 Foreign assistance programs
60 Agricultural Stabilization and Conservation Service
63 Federal Crop Insurance Corporation
66 Commodity Credit Corporation
69 Rural Development Service
72 Rural Electrification Administration
75 Farmers Home Administration
78 Soil Conservation Service
80 Federal Grain Inspection Service
81 Agricultural Marketing Service
82 Packers and Stockyards Administration
83 Food Safety and Quality Service
84 Food and Nutrition Service
96 Forest Service
06-00 Department of Commerce:
05 General administration
07 Bureau of the Census
08 Bureau of Economic Analysis
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10 Economic Development Administration
15 Regional Action Planning Commissions
25 Domestic and International Business Administration
40 Minority Business Enterprise
44 US. Travel Service
48 National Oceanic and Atmospheric Administration
49 National Fire Prevention:and Control Administration
51 Patent and Trademark Office
52 Science and technical research
70 Maritime Administration
07-00 Department of Defense--Military:
05 Military personnel
07 Retired military personnel
10 Operation and maintenance
15 Procurement
20 Research, development, test, and evaluation
25 Military construction
30 Family housing
35 Civil defense
37 Special foreign currency program
40 Revolving and management funds
45 Allowances
55 Trust Funds
08-00 Department of Defense--Civil:
05 Cemeterial expenses, Army ?
10 Corps of Engineers--Civil
17 Ryukyu Islands, Army
20 Soldiers' and Airmen's Home
25 The Panama Canal
30 Miscellaneous accounts
09-00 Department of Health, Education, and Welfare:
10 Food and Drug Administration
15 Health Services Administration
20 Cehter for Disease Control
25 National Institutes of Health
30 Alcohol, Drug Abuse, and Mental Health Administration
35 Health Resources Administration
37 Office of Assistant Secretary for Health
40 Office of Education
42 National Institute of Education
44 Office of Assistant Secretary for Education
60 Social Security Administration
70 Special institutions:
70 American Printing House for the Blind
70 National Technical Institute for the Deaf
70 Gallaudet College
70 Howard University
80 Assistant Secretary for Human Development
90 Departmental management
25-00 Department of Housing and Urban Development:
1
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02 Housing programs
03 Government National Mortgage Association
06 Community planning and development
12 New Communities Administration
26 Federal Insurance Administration
27 Consumer affairs and regulatory functions
28 Policy development and research
30 Departmental management
10-00 Department of the Interior:
04 Bureau of Land Management
06 Bureau of Reclamation
12 Office of Water Research and Technology
16 Bureau of Outdoor Recreation
18 United States Fish and Wildlife Service
24 National Park Service
28 Geological SurVey
30 Mining Enforcement and Safety Administration
32 Bureau of Mines
62 Alaska Power Administration
64 Bonneville Power Administration
68 Southeastern Power Administration
72 Southwestern Power Administration
76 'Bureau of Indian Affairs
82 Office of Territorial Affairs
84 Office of the Solicitor and Office of the Secretary
11-00 Department of Justice:
03 General administration
05 Legal activities
10 Federal Bureau of Investigation
15 Immigration and Naturalization Service
17 Drug Enforcement Administration
20 Federal Prison System
21 Law Enforcement Assistance Administration
12-00 Department of Labor.:
05 Employment and Training Administration
10 Labor-Management Services Administration
15 Employment Standards Administration
18 Occupational Safety and Health Administration
20 Bureau of Labor Statistics
25 Departmental management
30 Special commissions and councils
14-00 Department of State:
05 Administration of foreign affairs
10 International organizations and conferences
15 International commissions
20 Educational exchange
25 Other
21-00 Department of Transportation:
05 Office of the Secretary
15 Coast Guard
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0 20 Federal Aviation Administration
25 Federal Highway Administration
27 National Highway Traffic Safety Administration
30 Federal Railroad Administration
32 Urban Mass Transportation Administration
35 Saint Lawrence Seaway Development Corporation
37 Materials Transportation Bureau
15-00 Department of the Treasury:
05 Office of the Secretary
07 Office of Revenue Sharing
08 Federal Law Enforcement Training Center
10 Bureau of Government Financial Operations
12 Bureau of Alcohol, Tobacco, and Firearms
15 United States Customs Service
20 Bureau of Engraving and Printing
25 Bureau of the Mint
35 Bureau of the Public Debt
45 Internal Revenue Service
55 United States Secret Service
57 Comptroller of the Currency
60 Interest on the public debt
19-00 Energy Research and Development Administration
20-00 Environmental Protection Agency
23-00 General Services Administration:
0 05
10 Real property activities
Personal property activities
20 Records activities
25 Automated data and telecommunications activities
30 Property management and disposal activities
31 Preparedness activities
35 General activities
27-00 National Aeronautics and Space Administration
29-00 Veterans Administration
30-00 Other independent agencies:
01 ACTION
02 Administrative Conference of the United States
05 Advisory Committee on Federal Pay
10 Advisory Council on Historic Preservation
16 American Battle Monuments Commission
17 Arms Control and Disarmament Agency
18 Board for International Broadcasting
20 Central Intelligence Agency
24 Civil Aeronautics Board
28 Civil Service Commission
32 Commission of Fine Arts
35 Commission on Civil Rights
37 Committee for Purchase From the Blind and Other
Severely Handicapped
38 Commodity Futures Trading Commission
0 39 Community Services Administration
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40 Consumer Product Safety Commission
41 Corporation for Public Broadcasting
42 District of Columbia
44 Emergency Loan Guarantee Board
46 Equal Employment Opportunity Commission
48 Export-Import Bank of the united States
52 Farm Credit Administration
60 Federal Communications Commission
64 Federal Deposit Insurance Corporation
65 Federal Election Commission
66 Federal Energy Administration
68 Federal Home Loan Bank Board
72 Federal Maritime Commission
76 Federal Mediation and Conciliation Service
78 Federal Metal and Nonmetallic Mine Safety Board of
Review
80 Federal Power Commission
84 Federal Trade Commission
88 Foreign Claims Settlement Commission
31-01 Harry S. Truman Scholarship Foundation
Historical and memorial commissions:
03 American Revolution Bicentennial Administration
05 Other historical and memorial agencies
06 Indian Claims Commission
Intragovernmental agencies:
08 Advisory Commission on Intergovernmental Relations
09 Appalachian Regional Commission
10 Delaware River Basin Commission
11 Interstate Commission on the Potomac River Basin
12 Susquehanna River Basin Commission
14 Washington Metropolitan Area Transit Authority
16 Intelligence Community Oversight
17 International Trade Commission
20 Interstate Commerce Commission
21 Japan-United States Friendship Commission
22 Legal Services Corporation
23 Marine Mammal Commission
25 National Capital Planning Commission
27 National Center for Productivity and Quality of
Working Life
30 National Commission on Libraries and Information
Science
34 National Credit Union Administration
35 National Foundation on the Arts and the Humanities
36 National Labor Relations Board
40 National Mediation Board
45 National Science Foundation
47 National Transportation Safety Board
50 Nuclear Regulatory Commission
32-05 Occupational Safety and Health Review Commission
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0 08 Pennsylvania Avenue Development Corporation
10 Postal Service
20 Railroad RetireMent Board
25 Renegotiation Reard .-
35 Securities and g):Chcange CoMMi$Sion
40 Selective Service System
45 Small SuainesS Administration
50 Smithsonian Institution
33-11 Joint Federal-eState in Use Planning Commission
for Alaska
12 Other temporary commissions
13 National Commission PO thg Observance of Inter-
national Women's year, 1975
15 Tennessee Valley Authority '
25 United States Information Agency
30 United States Railw,ay Association
35 Water Resources Council .
Off budget Federal entities: .
Department of Agriculture;
55-05 Rural i.ectrifiqatiOn and Telephone kW/Caving Fund
55-05 Rural,Telephone Ban . .
Department of Housing arid Urban: Development:
...,
* ' .
55-.25 Housing for the lldsrly In handi900Ped fgrld?
Department of.babor:' .- :
55-35 Pension $enefit-GParanty -CO-PP:ration'
Department of-Tre4SUrYi Th- ?
55-45 Enphange Stabilization Fund
55-45 Federal Firlancing.Pank '
Independent agenciest -
Peard of Governors of. thejederal Reserv System
55-75 Postal Service .
55-85 United States RaiWayAsSOciati.6.11,.
Government sponsored,'pirVately. owned 4nterprisesi:
Department of. Realth,.EdupatiOn, and'Welfere:.
61-60 "Stlident toan.Marketing.ASSOciation. . .
Department of Housing :end' Prban DsVelppmenti.
61-60 . Federal NatiOnal Mortgage Association
Farm Credit AdministrAi9P; '' '
61-70 Ranks for cpoperatiVes ' .
61-70 Federal intermediate?etre'dit banks
61-70 jederal land banks . ,
Federal Home Loan Bank pQ4r0i -
61-60 Federal home loan banks
61-90 Feder4l HOme-lioan Mortgage Corporation
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ATTACHMENT C
Bulletin No. 77-12
FUNCTIONS AND SUBFUNCTIONS IN THE 1978 BUDGET:
CLASSIFICATION CODES AND TITLES
The titles and codes of the subfunctions listed in this
Attachment will be used to identify the additional
subfunctions associated with each decision unit. Background
information on the functional classification (Appendix 1)
and definitions of each function (Appendix 2) are also
provided to assist in classification by additional
subfunctions.
050 NATIONAL DEFENSE
051 Department of Defense-Military
052 Military assistance
053 Atomic energy defense activities
054 Defense-related aCtivities
150 INTERNATIONAL AFFAI4
151 Foreign economic and financial assistance
152 Conduct of foreign affairs
153 Foreign information' and exchange activities
-155 International financial programs .
250 GENERAL SCIENCE, SPACE, AND TECHNOLOGY
251 General science and basia research
253 Space flight
254 Space science, applications, ?and technology
. 255 Supporting space activities
300 NATURAL RESOURCES, ENVIRONMENT, AND ENERGY
301 Water resources and power
302 Conservation and land management
303 Recreational resources
304 Pollution control and abatement
305 Energy ,
306 Other natural resources
350 AGRICULTURE
351 Farm income stabilization
352 Agricultural research and services
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400 COMMERCE AND TRANSPORTATION
401 Mortgage credit and thrift insurance
402 Postal Service
403 Other advancement and regulation of commerce
404 Ground transportation
405 Air transportation
406 Water transportation
407 Other transportation
450 COMMUNITY AND REGIONAL DEVELOPMENT
451 Community development
452 Area and regional development
453 Disaster relief and insurance
500 EDUCATION, TRAINING, EMPLOYMENT, AND SOCIAL SERVICES
501 Elementary, secondary, and vocational education
502 Higher education
503 Research and general education aids
504 Training and employment
505 Other labor services
506 Social services
550 HEALTH
551
552
553
554
555
600
Health care services
Health research and education
Prevention and control of health problems
Health planning and construction
General health financing assistance
INCOME SECURITY
601 General retirement and disability insurance
602 Federal employee retirement and disability
603 Unemployment insurance
604 Public assistance and other income supplements
700 VETERANS BENEFITS AND SERVICES
701 Income security for veterans
702 Veterans education, training, and rehabilitation
703 Hospital and medical care for veterans
704 Veterans housing
705 Other veterans benefits and services
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750 LAW ENFORCEMENT AND JUSTICE
751 Federal law enforcement and prosecution
752 Federal judicial activities
753 Federal correctional and rehabilitative activities
754 Law enforcement assistance
800 GENERAL GOVERNMENT
801 Legislative functions
802 Executive direction and management
803 Central fiscal operations
804 General property and records management
805 Central personnel management
806 Other general government
807 Federal Financing Bank
850 REVENUE SHARING AND GENERAL PURPOSE FISCAL ASSISTANCE
851 General revenue sharing
852 Other general purpose fiscal assistance
900 INTEREST 1
901 Interest on the public debt
902 Other interest
950 UNDISTRIBUTED OFFSETTING RECEIPTS
951 Employer share, employee retirement
952 Interest received by trust funds
953 Rents and royalties on the Outer Continental Shelf
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Sr
Appendix 1
Bulletin No. 77-12
BACKGROUND INFORMATION ON THE FUNCTIONAL CLASSIFICATION
The functional classification is one of the principal
methods used in classifying budgetary data; it has been used
for three decades as the framework for discussing the
President's program in the budget documents. The historical
data tables for outlays in the budget are presented almost
exclusively in functional terms, thereby Providing a
consistent basis for comparing changes in spending over
time. In addition, the Congressional Budget and Impoundment
Control Act of 1974 (P.L. 93-344) requires that the Congress
exercise control over the budget through use of targets by
function. This provision means that the functional
classification is not only used to display. the budget, but
also to control it.
Background.
A comprehensive functional classification of budget
authority and outlays was first used in the 1948 budget. As
stated in that budget:
By grouping together items which are functionally
related, regardless of the agency which is
responsible, this type of classification provides for
the Congress and the public a useful summary of what
the Government is doing, or expects to do, and, in
general, focuses upon the ultimate purpose which the
government programs are designed .to serve. *
Thus, the emphasis of the functional classification is on
what the Federal Government seeks to accomplish rather than
on the means of accomplishment, what the Government
purchases, or the clientele or geographic area served. (An
example of a clientele group not identified in the
functional structure is "Indians"; Indian health programs
are in the health function; Indian community development
programs are in community development, etc. In contrast,
one interest group (veterans) has traditionally been singled
out and treated as a separate function.)
In the past, each unit being classified (i.e., generally, an
appropriation account) has been classified into the single
best or predominant purpose served. Quite often,
alternative classifications have been both possible and
reasonable. For example, training of medical research
*The Budget of the United States, 1948, p. 1353.
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personnel in a military hospital could readily be classified
as national defense, as education, as manpower training, or
as health. Because an activity is classified in the budget
into the one category that identifies its predominant
purposes, and because most Federal programs serve more than
one goal, the amount shown in the budget in virtually every
function understates the total Federal resources applied to
that purpose. This method is necessary if the sum of the
outlays (or budget authority) for all functions is to equal
the budget total, and it continues to be the rule in the
context of the functional presentation in the budget
documents.
However, the purpose of this bulletin is to obtain an
accurate and rigorous identification of the multi-purpose
activities of decision units and to code these units
accordingly. The functional classification structure is
being used because it is the best existing classification
structure for this purpose. The budget subfunction code
assigned to a decision unit will be the subfunction code
assigned to the account from which that unit is funded. The
additional subfunction codes will identify the less
important purposes served by the activities of that decision
unit. For example, the primary purpose of medicare is to
promote health, so in the functional classification it is in
the health function (subfunction 551). However, under this
bulletin the medicare program could also be classified as
income security and coded in the report in the most nearly
appropriate additional subfunction category (in this case,
subfunction 604).
The primary purpose of this exercise is to identify the
major additional (alternative) subfunctional codes. It is
recognized that choosing the most nearly appropriate
additional subfunction codes must necessarily be arbitrary
in part, since the subfunction titles are structured to
identify the primary purposes and are simply being adapted
for this exercise.
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Bulletin No. 77-12
DEFINITIONS AND PARAMETERS OF THE
FUNCTIONAL CATEGORIES
The following definitions and parameters for major functions
provide guidance in determining the categories (i.e.,
additional to the budget subfunction used to identify the
account that finances the decision unit) for the additional
subfunction coding report to be submitted with the 1979
agency budget submissions. Comparable definitions and
parameters for subfunctions have not been developed.
Therefore, classification by additional subfunctions must be
based upon the guidance provided by these definitions of
functional categories, the list of functional and
subfunctional codes and titles in Attachment C and upon the
judgment of the classifier.
This description of major functions wa? originially
developed to aid in functional classification of each unit
by primary purpose (i.e., by budget function and
subfunction). For the purposes of this Bulletin, the
descriptions are to be used to determine applicable
additional subfunctions for each decision unit. Since these
additional subfunctions need not be within the same major
functional category as the budget subfunction, some activi-
ties that are not classifiedunder a particular funOtioh-al
0 category -- but are closely associated with it -- are
specifically identified as candidates for classification as
additional subfunctions.
National defense
This function includes those programs directly related to
the common defense and security of the United States. It
includes the raising, equipping, and maintaining of armed
forces (including civilian supporting activities);
development and utilization of weapons systems (including
nuclear weapons); and the provision of military assistance
to friendly governments.
National defense includes direct compensation and benefits
paid to active military and civilian personnel;
contributions to their retirement, health, and life
insurance funds; military retired pay; the conduct of
defense research, development, testing, and evaluation; and
procurement, construction, stockpiles, and other activities
undertaken with the direct object of fostering our national
security.
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. ?
? EXclUdedfrom.natianaLdefenae functional classification but
identified as candidates for claSsificatiOhaaadditional
-OUbfunctions are the peadeful conduCt Of foreign :relations,
foreign . economic development And humanitarian assistance,
?SubSidiet.tp busiries5jApy-;.64Villan .agencies 'that. ? May The
partially justified :.*...promoting. national sectitityrand
research and operation Of agencies (suth as space research)
whose. program mission is not directly designed to promote
national ? defense but which could result in some significant
benefits:to our national sedurity.
Internatibnal affairs
This function is concerned with the establishment and
maintenance of peacefUl. relations, commerce, travel, and
developMent between the United States and the remainder of
the world. It includes the conduct of foreign affairs,
S. Membership in international- ? CirganizatiOns, foreign
information and eichange .activities, economic Assistance
programs, and grant and Than programs designed to foster
fereigh cammerce.
? ,?
Excluded from the ihterhatiOnal. affairs function but
identified as candidates:far .clasdificatiOn- at Additional
subfunctions aremilitary-AsSistande programs, and other
.programs. that are. COhderned:H.significantly (bOt.2: not
primarily) with the . establiShment and, maintenanCe of
peaceful relations, commerce, travel, and development
between 'the United Stated' and the remainder of the world
(e.g., promotion of tourism' and. commerce).
General science, spade, and.teChnology
. ;
The purpose of this function is. ? to show all science and
research activities of the Federal Government where the goal
is man's general advancement of knowledge. In addition,
research program d that haVe diverse goals and Cannot readily
be classified into one specific; function ate also placed
here to avoid detailed splitting of accounts.
Included in this function are general scientific research
programs that are not an integral part of the programs
conducted under another function. This includes the
research conducted by the National Science Foundation' Space
research and technology, except aeronautical technology; and
the broad-based. scientifid activities of the Energy Research
and Development Administration,
3
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As is noted above, research programs that are an integral
part of the achievement of other major functions -- e.g.,
health, national defense, energy -- are excluded from this
function. Nonetheless, these research programs could be
classified as additional subfunctions relative to this
budget function.
Natural resources, environment, and energy
This function includes those programs whose primary purpose
is to develop, manage, and maintain the Nation's natural
resources and environment or to promote the conservation and
development of energy resources. It encompasses development
and management of water resources and power; protection and
enhancement of environmental quality; development and
maintenance of recreational resources; promotion of the
prudent use of forest and mineral resources; nondefense
research and applications of nuclear power, fossil fuels,
and other energy sources; other energy programs such as fuel
allocation and energy conservation programs; the fostering
of conservation practices on both public and private lands;
and the management of the public domain.
Excluded from being classified in this function are urban
water supply programs, basic sewer systems, and waste
treatment plants that are an integral part of a Federal
facility (such as a military installation) unless these
activities are an integral part of an environmental
protection program and are specifically funded as
environmental protection. Nonetheless, such activities are
candidates for classification as additional subfunctions
relative to this budget function.
Agriculture
This funttion includes those programs that promote the
economic stability of agriculture and the capability to
maintain and increase agricultural production. These
objectives are accomplished through farm income
stabilization programs, research and educational activities,
programs that maintain agricultural markets, regulation of
agricultural markets and practices, and losses from the
disposal of surplus commodities.
The function does not include programs which, though related
to rural development, are not directly related to
agriculture. Examples . are rural environmental and
conservation programs, which are classifiedlin the natural
resources function. Nonetheless, such programs might well
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be classified as additional subfunctions relative to this
budget function.
Commerce and transportation
This function includes the promotion and regulation of
commerce and transportation. Activities classified in
commerce include collection and dissemination of social and
economic data unless this is an integral part of another
major function (such as health); loans, subsidies,
insurance, and regulation of business unless these are an
integral part of another function; and the subsidy to the
Postal Service.
Activities classified as transportation include all programs
with the primary aim of providing for the transportation of
the general public and/or their property, regardless of
whether local or national and regardless of the particular
mode of transportation. They include the construction of
facilities; purchase of equipment; research, testing, and
evaluation; provision of communications directly related to
transportation (for example, air traffic control by the
FAA); and operating subsidies for transportation facilities
(such as airports) and industries (such as railroads).
Transporation includes regulatory activities directed
specifically toward the transportation industry rather than
toward general commerce.
Excluded from classification in this function but candidates
for classification as additional subfunctions are foreign
economic assistance related to transportation facilities or
programs abroad; the construction of roads, trails, etc., as
an integral part of the operation of public lands, parks,
forests, or military reservations, unless they .are
specifically funded as part of a broader transportation
system; the construction of roads or other transportation
facilities as an integral part of a broad community facility
or regional development program where the clear intent of
the program is regional development and the provision of
transportation facilities is only an incidental by-product
or means to attain the objective of regional development.
Also excluGed from classification as transportation are
research and technology activities devoted to space
research, except for aeronautical technology, even though
this research may eventually be to the advantage of general
transportation. These activities might, of course, be
classified as additional subfunctions relative to this
budget function.
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Community and regional development
5
Activities classified in this function consist of broad-
based community and regional development programs and
programs concerned with urban and rural renewal. They
incluae water supply and sewer systems (except those
specifically funded as environmental protection programs);
urban renewal programs, regional economic development
programs, broad-based public facility construction programs,
and rehabilitation of public facilities in the event of
natural disasters.
As a normal rule, social services, transportation facilities
and operating subsidies, and business loans and grants are
excluded from classification in this function. However, if
sucn programs are undertaken as specific means to achieve
the broader community development goals and such programs
are financed out of broad community development programs
rather than as an integral part of transportation, social
service, or other programs, they will be included in
community development. Otherwise, they may be classified as
additional subfunctions relative to this budget function.
Education, training, employment, and social Services
0 Activities that are classified in this function include
those with outlays designed to promote the general extension
of knowledge and skills and/or to assist individuals to
become self-supporting members of society. It inclUdes the
provision of education or training services, income support
directly related to training or education, child care, and
general social services: provided to individuals and
families. It includes cash payments (scholarships, loans,
or stipends) to persons when such payments are provided to
enable a person to participate in education or training
programs. It also includes research directly related to the
provision of said services. It excludes education or
training undertaken as an integral part of the achievement
of another functional end (such as training of military
personnel; veterans education, training, and rehabilitation;
or training of health research workers in a health program)
and also excludes general purpose scientific research. (Of
course, these activities might be classified as additional
subfunctions.;
The provision of social services -- child care, employment
counselling, and vocational rehabilitation -- are included
in this function unless they are restricted to, and are an
integral part of, anotheir function, in which case they may
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be classified as additional subfunctions relative to this
budget function.
Health
The programs classified in this function involve those that
have as their basic purpose the promotion of the physical
and mental health of the Nation's population, including the
prevention of illness and accidents. They include research
into the causes and cure of disease; promotion of consumer
and occupational health and safety; planning, financing, and
provision of medical care; the financing of specialized
programs for training of health workers and researchers; and
food (including meat), drug, and other product safety
inspection programs.
Excluded from the health function but identified as
candidates for classification as additional subfunctions are
Federal fund medical costs that are an integral part of the
cost of Federal employment (such as medical care for
military personnel and veterans), general scientific
research that has medical applications (such as health
research conducted by the National Science Foundation), and
health programs that are an integral part of foreign
assistance.
Income security
This function includes payments to persons for which no
current service is rendered. It includes retirement
(excluding military retired pay), disability, Unemployment,
and welfare payments and the associated administrative
costs. Also included in income security are the food stamp,
special milk, and child nutrition prograMs (whether the
benefits are in cash or kind); both Federal and trust fund
unemployment compensation and workmen's compensation; public
assistance cash payments; benefits to the elderly and to
coal miners; and low - and moderate-income housing aids.
Excluded from the income security function but identified as
candidates for classification as additional subfunctions are
financial assistance for educational purpeses, cnild care
services, vocational and employment training, vocational
rehabilitation services and stipends, medical:care (whether
in cash or kind), subsidies to businesses (such as farm
price supports) that end up as income to persons, income
security programs restricted to veterans and their
c.ependents, and military retired pay.
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0 Veterans benefits and services
This function consists of programs providing benefits and
Services, the eligibility for which is related to military
service but which are not an integral part of national
defense. It includes veterans service-connected
compensation; veterans non-service-connected pensions;
veterans readjustment benefits, housing, and medical care
programs.
As a normal rule, activities classified in this function are
similar to those in the broader general purpose functions
(such as income security or health) but are restricted to
veterans and their dependents. Hence, where the broader-
based functions provide benefits to veterans, they should be
reported as additional subfunctions relative to this budget
function.
Law enforcement and justice
This function includes those programs designed to provide
judicial services, police protection, law enforcement
(including civil rights), rehabilitation and incarceration
of criminals, and promotion of the general maintenance of
domestic order. Excluded from this function but identified as
candidates for classification as additional subfunctions are
the activities of the legislative branch, the narrow-purpose
police or guard activities providing protection to Federal
property, activities that are an integral part of a broader
function (such as postal inspectors, tax collection agents,
and Park Service Rangers), and the costs of. National Guard
personnel and military personnel who are called upon
occasionally to provide general public safety protection, as
well as military police.
General government
This function includes the general overhead costs of the
Federal Government including legislative and executive
activities, provision of central fiscal, personnel, and
'property activities; and the provision of services that
cannot reasonably be classified in any other major function.
As a normal rule, all activities reasonably or closely
associated with other functions shall be excluded from the
general government function. Nonetheless, general overhead
costs of departments and agencies that are associated with
other functions could be classified as additional subfunc-
tions relative to this budget function.
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Revenue snaring and general purpose fiscal assistanbe.
This function includes Federal aid to State, local, and
territorial governments that is available for general fiscal
support or is available for distributiOn atahg ,programs
involving two or more major budgetary functions *hen the
distribution among those functions is at the disctetion of
the recipient jurisdiction. It includes payments in lieu of
taxes, broad-purpose shared revenues, General Revenue
Sharing, and the Federal payment to the Dittriat of
Columbia.
Interest
.Interest is the cost attached to borrowing or lending money.
It is not an objective in and of itself, but rather a result
of seeking to fulfill other objectives. The other
objectives can normally be identified in two broad
groupings: (1) those in which the transaction directly gives
rise to interest payments or income; and (2) the general
shortfall of income over outgo (or the conver8e) aribing out
of fiscal, monetary, and other policy considerations and
leading to the creation (or elimination) of inteteat-bearing
debt instruments (normally the public debt).
The interest function includes interest on the public debt,
on uninvested funds, on tax refunds, and interest recorded
in budgetary receipt (propriety or intergovernmental)
accounts (except for interfund interest received by trust
funds).
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6:r.?
BULLETIN No. 77-11
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/lc J.Jrr
Distribution made:
1 - DDA
1 - DDI
1 - DDO
1 - DDS&T
1 - AO/DCI
2 - Chief, DDA Grou
STAT 1 - OGC Library,
1 - OMB Bull
STAT 1- -gpacx fl rv-i 60 /Ao
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EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 201503
June 28, 1977
BULLETIN NO. 77-11
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Controlling Grade Escalation in the General
Schedule
1. Purepose. This Bulletin establishes a plan for
monitoring, evaluating, and controlling increases in the
average grade of specific General Schedule occupations
within executive branch agencies.
2. Background. Since May 1976, the Office of Management
and Budget (OMB) and the Civil Service Commission (CSC) have
been working with other executive agencies on a series of
activities aimed at better controlling average grade
Government-wide. In conjunction with these efforts, OMB and
CSC .have developed a new information system for analyzing
changes in average grade. All executive agencies and
establishments having 500 or more employees as of the date
of this Bulletin and in March 1974 are covered by the
system. It has been designed to allow OMB, CSC and agency
heads to better measure present accomplishments and
problems; to alert them to grade escalation trends as they
begin; and to allow for precise tracking of agency progress
toward reaching grade reduction targets where these are
determined necessary. The system will provide very detailed
information on the specific occupations within each
department and its subordinate bureaus where grade
escalation has occurred. It will also provide comparative
cost data to illustrate the cost implications of maintaining
the present grade structure in these occupations as opposed
to exploring alternative structures. Specifically, the new
system will provide:
a. A rank ordering of series within each agency based
? upon the costliness of the increase in average
grade which each series has experienced. This is a
factor of the amount of the increase, the
population, and the salary levels involved.
b. An analysis, by occupation within agencies, of the
percentage of employees presently at each grade
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level and the percentage change at each grade level
from the reference date of march 1914.
An analysis, by occupation !within agencies, of the
comparative differences in cost between the preterit
percentage distribution of employees at each grade
:level, and the percentage of employees at eath
grade level:
(1) That existed in this same occupation and agency
in March 1974.
(2) That presently exists for this occupation
Government-wide.
A. 1A rank ordering of series within each agency based
upon the rate at which their average grade has
increased.
e. A rank ordering of series within each agency :bated
upon the rate at which their average grade has
increased, adjusted .to take into account
differences between the present agency and
? Government-wide average grade for each series.
f. An analysis of the .total net increase in average
grade agency-wide adjusted to account for ChangeS
in series population.
3. Mired Actions. The first data from this new system
.shoul e ready in late July 1977. Subsequent reports will
be furnished on a semi-annual basis. All agency heads of
-units included in the system will receive the information at
soon AS it is available. Upon receiving these analyses,
agencies should examine the data and identify those
occupations where there is a substantial cost impact, or
rate of increase, or potential for savings. Not all series
need to be reviewed. A high ranking on any one or More of
the factors described in 2.a.-f. above could, however, be
? significant. This would include, for example: 0
a. Series with small populations. . which have a
? relatively low cost of increase ranking (factor
2.a.), but are increasing at a very rapid rate
? (factors 2.d. and 2.e.).
b. Series with large increases in the percentage of
employees at high grade levels.(faCtor 2.b.). Such
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shifts are a problem even where increased entry
level hiring has kept average grade fairly stable
and thus factor 2.d. and 2.e. ratings are low.
Over time the new employees are themselves eligible
for promotion to the higher senior level grades.
When and if series expansion abates, average grade
can escalate dramatically.
c. Series where the cost of the present grade
distribution pattern is markedly higher than the
comparative cost if employees were distributed in
accord with the 1974 or the Government-wide pattern
(factor 2.c.). Such series might present an
opportunity to achieve great savings through job
restructuring, etc., even though they have had only
moderate recent increases (factor 2.d.), and thus
low cost of increase rankings (factor 2.a.).
' 4. Grade Reduction Targets. For each series identified in
the manner described in section 3 above, agencies will:
a. Determine whether the increases in average grade
which have occurred are fully supported and
required by changes in the nature and complexity
? (not volume) of the work.
b. Determine whether the existing grade structure is
essential in light of comparative cost data on
alternate grade structures in other agencies, and
the grade structure Government-wide.
c. Set grade reduction targets for those occupations
which fail to meet either of the above criteria.
Not all series will have targets.
In light of the special emphasis given to position
management and job classification in the past year, and the
many ongoing internal programs to control grade escalation
which agencies have reported to OMB and the Civil Service
Commission, it is anticipated that agency heads should
? already have sufficient data on hand to make initial grade
? reduction projections. Agencies will submit proposed
occupational grade reduction targets to OMB along with their
FY 79 budget requests (see attachment for format). For each
occupation where grade reduction targets are determined
necessary, agencies will provide:
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a. ThsCivil, Service: job classification series, code,
azdtitle,
The-. agency. occupational. title. if different.
Average-. grade. Listed, in most recent change
average- grade analysis.
The. praposed average grade: target. level, to. be:
reached by the. end. of each of the. next three: fiscal,.
years,. beginning, with FY 78.
OMW review and. these, grade reduction. targets in
caniunctian with the normal. budget. process. Agencies will.
be notified, only,. if there. are questions- regarding their.
proposed targets. Data on changes in average grade- will be
madeevailable to agencies. semiannually. As they receive.
new reports. agencies will review, their progress on. existing:
goals and: the need. for new or revised' targets:inthe
occupations identified..
lmvitementation Plans. Agency heads have the primary:
'responsi_iIity for' ensuring. that. adequate, grade reduction
'goale-are set, and it is intended that agencies have the,
maximum: flexibility. in developing, and' carrying out.. programs
and:plansto meet these goals. There, are a variety, of
'options. available to, agencies' including:
Ensuring: that increases in average grade are: fully..
supported, by Civil Service Cbmmission job..
classification standards,. The. Commission'. will: be:
using. data from the study as an aid, in planning its.
own. allocation of classification, review resources.
b. Evaluating, all vacancies., to determine, whether they-
can. be eliminated or restructured at elower,gradS
c. Closely monitoring and' carefully evaluating:
promotions.
Reviewing supervisory levels, with particular
attention to. the extent of.. "layering? and- the need
for deputies, or assistants.
e. Reviewing the organization structure of each unit.
to determine if existing .staffing patterns. are.
still appropriate in view Of' program changes.
O
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Staffing new programs in a manner that will tend to
lower average grade.
f. Reorganizing work where appropriate so that it can
be accomplished with lower graded employees. For
example, using technicians where professional staff
is not being utilized at their full skill level.
Strengthening agency position management systems
prescribed by OMB Circular A-64.
As long as agreed-upon goals are being met, agencies are not
required to submit implementation plans to OMB.
Justifications, timetables, background papers should not be
submitted unless specifically requested.
(3.
6. Effective Date. These instructions are effective upon
issuance of this Bulletin.
7. Inquiries. Inquiries should be addressed to the OMB
representative in charge of the agency's budget estimates.
Attachment
Comm
Bert Lan e
Director
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ATTACHMENT
BULLETIN NO.77-11
Agency Title
Date
PROPOSED GRADE REDUCTION TARGETS FOR
(list fiscal year of budget submission)
a. b. c. d.
Series Classification Agency. Title Present Average Target
Code Title If Different Grade
Example:
343
Management
Analyst
FY 78 FY 79 FY 80
10.7 10.60
10.50 10.35
a. The Series Code and Classification title can be found in the Civil Service Commission
published classification standards and its Handbook of Occupational Groups and Series of
Classes.
b. Leave blank if no difference. Within an agency, this occupation might be referred to by
another name such as Program Analyst or Program Evaluation Specialist.
c. This is the average grade listed in Tab A of the most recent change in average grade
report. Agencies will be provided with this information.
d. This is the end-of-year grade reduction target agreed upon by OMB and the agency.
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41?.e?-?114-/Ic
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STAT
eccseeet- anzz--4-
I ? 40/Der
/?ode
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EXECUTIVE OFFICE OF THE PRESIDENT ?
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
BULLETIN NO. 77-10
.May-26, 1977
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Information required for the Mid-Session Review of
the 1978 Budget
1. Purpose. These instructions cover the Preparation and
submission of information. required for the Mid-Session
Review of the 1978 Budget. The Review will be transmitted
to the Congress on or before July 1, 1977.
2. Background. For the-purpose of. preparing this report,
OMB must obtain.:
revisions ,in the estimates of *budget authority,
outlaysi..and _receipts for 1977 end 1978 previously
transmitted tw-thg.Collgress;
estimateebudget authority and outlays for the four
succeeding years for eaah accodnt; and
estimatecEoutlays for the four succeeding/ years from
1978 year-errd balances of controllable programs.
The Mid-Session Review will present the current status of.
the President's Budget, including estimates for Government-
owned entities outside the budget totals. The detailed
information contained in this report, together with
supporting data, will be used by the Congress in connection
with its budget scorekeeping responsibilities and for the
development of the second concurrent resolution.
Agencies should pay particular attention to current spending
trends to ensure that outlay estimates for 1977.and 1978 are
realistic. In revising the estimates, agencies should also
take into account the revisions transmitted to the Congress
on April 22 and subsequently.
3. Definitions. In preparing this report, revisions will
be made .to budget estimates transmitted to the Congress on
three previous occasions. In this Bulletin, these earlier
estimates are referred to as follows:
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4.
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2
Jarluarry r:BUidget
February 'audget ReVisions
uoi estiMate's :Erans-
7Mitted to the COngiess on
4-anuary 17-, 1977 ("Fiord
Igudget").
. ,
Revised budget estimates
tr.ansmitted 'to the
Congress On 'February 22,
1977 ("C-atter Budgel")
April estiMatee The "Current 'Budget
Estimates" ttaritiffift.ted to
Congress on April 22,
?
-
4. Mater4als tetiblied% 'OMB prOVide for agency use
three copies of TheSuppleMentafy SouiCe Doc6Ments (SD ) and
the ,Retflgt,Atedattata T44Ve., 4eaoh of which 'COhiains data
from the Febtbaty balget TeViSiOns: In addition, each
agency will reeeiVeLthree depiee Of a lOnprange projection
file and some agehclee Will teceivethree copies of a file
with infOtmatibb oh lihexpeh.ded FY 1978 balancee from the
January budget4 :The ageWCiegabbid use the 'data filee,:as
follows:
a: SUPPlebehtaCy illaabment tile. 'hi S file
contains the abahhttgAn the February budget revisions. It
will be used at_th.e basis fot aggerlay review and submission
of data for the Mid=SessiOn RevieWl
The file ShoUld be.ahnotated 'ea follOWS: ;
(1) For,:atcoUntS tO_Ohibh.nd chafiges are neceSeary,
the file.shoUld be ogt-kga v. in the left margin 'opposite
the 11-digit identifiCatioh codel
(2) Chariget tO the 112'digit identification Code may
be reguired due to a change ih fhe iranSmittal status of
proposed. aMoUnta (gee 014.8 Circular NO. A:-11, section 21..3).
For example, the file fof the' February budget revisions
sepatately identified Many Of th8 Changes as items 'for litei
transmittal (tfehaMittal Ccide 3): In all cases in which
these requests have since been ttahtmitted to the Congress,
the. amounts thy-ado-go ghadia 4614 JiieFia into the regular
budget schedule affibuhtg (0afiftita1 code 0); Other chariges
which should be Made-in'aludei
All erifidted aliellpieMentals should be merged
With dither enadted amodnts.
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0
The transmittal status for amounts in the
February . budget revisions that were
proposed for later transmittal under
proposed legislation (transmittal code 2)
should be reviewed. If only ?the
authorizing legislation has been
transmitted, ,the transmittal code 2 should
be retained, regardless of whether the
authoriiation has been enacted. On the
other hand, if the authorization request
has been enacted and the appropriation
request transmitted,-IEe transmittal code
should be changed to "Supplemental under
existing legislation" (transmittal code
1).
Rescissions that were pending at the time
of the February revised estimates and were
later accepted by the Congress should now
be merged .with other enacted. amounts.
Those ,pending reseissions that were not
accepted by the Congress should be deleted
from the file. Any new "rescission
? pending" items should be,added.
(3) Change.. in the budget estimates should be made
in red by drawing -a single line through the earlier entry
and legibly recording above it the current entry.
(4) Enacted pay supplementals and their associated
outlays should be merged into the pAppropriation" and
"Outlays" entries (lines 40 or 43 and 90 of. the SSO, Section
A). .
(5) For accounts not 'currently. in the file,
agencies will provide data through submission of an original
-nd one copy of the SSD (S.F. 307-T) prepared in accordance
with Tatructions contained in sections 41.1-41.4 of OMB
Circular No. A-11, Revised. The first two amount columns
will be left blank and the remaining columns headed "1977,"
and "1978" will be completed.
b. Receipt account data file. This file is a computer
listing.'of receipt data gialided in the February budget
revisions. Accuracy of the data will be verified and the
left margin, annotated in the same manner as for the SSD file
(see paragraph 4a above). Revised amounts will be entered
in red.
?
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lionrrange:7-projeCtiOns',. Thisc- ? the. Long-
Range Data ane uoatle Eoznr,,,diSpIays' agency, bureau,, and.
account tit resi with', lite: number's' identifying each account
(See. Exhibit, ? 1)1.. The., rine- entries present account_ level
detail. that:. was comRiled: earlier. this. spring for. internal
Agencies- should; enter in- reaypn, this listing estimates or
- reeStimatett-YCf-/.9..713.1*2277- 'rang-range projections' ? ' These
' projections. are: designee to-, indicate the degree to which:the
President's 19-78 budget plans-- commit future f inancial. .
resources:. These, estimates- and:. projections will be prepared
in, accotdance with Attachment,A%.
d. End of" year unexpended balances, file.- This fire it
a, computer' listing containing estimates of unexpended
balances of_ controllable, programs. reflected i'n' the
January budget. Agencies. will revise the. amounts for. 19:78
and estimate: the: spendhut of .theset,halances in, future years..
in. accordance: with the) instructions in. Attachment: B. and in
the. format. of:
?
e. .Transmittal letter-. Agencies will submit an
original and one copy of a transmittal letter. This letter
will' include a brief explanatibm Off Major changes to the
estimates of total budget authority; outlays, and receipts,
and should identify. the addltion or deletion. of accounts
from the long-range- projectiph, file, ; as. required- in
Attachment- A.
Agencies will include the: transmittal letter an
Analysis,of Changes, tableiprePared, in the format of Exhibit
3. This table will provide, a- bridge from the february:
-budget revisions t(:): the' April" estimates- and from the April ?
estimates to the* current. estimates. ' The table will
separately, identify. all, major,. revisionsj(in. excese of $50 '
. million) . 1Other smaller Changes. may be' cbinbinee in an "All
othet, changes, net" entry,
. , ,
5.. Basis for the. revised, estimates... Amounts. for 1977- and'
197.8 will' be ? revited, to' reflect. changes due tb. reestimatet/
publicly-announced: Administration proposals, and'
Congressional action or inaction-- . I .
a., Reestimates?.. Agencies, shomjth remiew6 the. estimates.
. and. make, adjustments. wbereA appfppr iatei. to. reflect:curtent
spending trends, and other actions-, or events that affect th-e.
estimates, The, new: estimates. sheiuld also teflect changes in
economic assumptions since transmittal :of the prev.i6us..
?
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5
.estimates. 'Economic .assumptionstio'be used in preparing new
estimates will be ptovided.by OMB.- '
b. Administrationv,initiatives. Estimates should be
revised to.reflect cEinges due to:
..mc(1)-Uagetamendments ' and supplementalp
,
transMitted, YOr.,approved and pending in OMB (the final
compilation of estimates will be 'adjusted by OMB to include
only those items that have been approved by the President),
(2) deferral or rescission proposals transmitted;
(3) legislative proposals transmitted or publicly
supported by the President that affect budget authority,
outlays, or? receipts, and
(4) other initiatives approved by the President.
c. Congressional action or inaction. Revisions to the
estimates should reflect cEanges due to Congressional action
or inaction, including enacted appropriations, delayed
enactment of proposed legislation, enacted authorizations,
and action or inaction on deferrals and rescissions. The
effect of reduction proposals by the Administration should
be included as proposed unless delays in enactment require
modification of the estimate or Congress has taken an action
that clearly requires a revision. Revisions attributable to
enactment of discretionary authorizatiohs for appropriation
should reflect only the Amounts that have been specifically
requested or approved by the President to be requested as
appropriations.
In preparing revised estimates for legislative proposals not
yet enacted by the. Congress, agencies f should assume an
effective date of October 1, 1977, Where an' earlier date had
been assumed previously.
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6. Timing of submissions.. Agencies should submit two
copies of each of the required materials to OMB no rater
than June 10, 1977,
Bert Lance
Director
Attachments
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ATTACHMENT A
Bulletin No. 77-10
INSTRUCTIONS FOR THE PREPARATION OF LONG-RANGE PROJECTIONS
General Instructions.
1. Projections will reflect the future budget authority,
outlays and offsetting receipts implicit in the program
levels, initiatives, and economy measures approved by the
President. No discretionary changes are to be assumed in
programs unless they are the result of specific public
Presidential commitments. The projections should not
anticipate future policy decisions. However, they should
reflect any specific Presidential decisions made for the
budget year that affect later years.
2. In general, amounts will not be included for anticipated
price increases or future Federal pay raises. These amounts
will be computed by OMB and included in an aggregate
allowance. The exceptions to this general rule are:
a. Beneficiary programs will reflect inflation
adjustments requited by provisions of law:
b. Where approval has been given to agencies by OMB for
inclusion of anticipated future price increases for certain
multi-year, fully funded major procurement or construction
programs (e.g., the space shuttle,. nuclear reactors, and
major weapons systems) and for RDT&E for major systems, such
anticipated increases will be reflected in projections of
budget authority and outlays in accordance' with the economic
assumptions supplied by OMB.
3. In general, growth in agency workload will be assumed to
be offset by productivity increases so that related
employment will not increase.
4. On-going programs whose authority expires during the
forecast period will be projected at the level of the
program in the year prior to its expiration, unless there
are specific policy determinations to the contrary.
Programs that are clearly one-time or temporary, such as
temporary study commissions, should be allowed to expire.
5. Projections for benefit payments:
a. Uneuloyment insurance benefits. Estimates for
these benefits shoulU be consistent with the aggregate
unemployment rate assumptions supplied by OMB.
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2
b. Medicare and Medicaid. Projections for these
programs shoula be base Z on 'HEW forecasts and the latest
actual information available. Assumptions on medical care
prices related to the Consumer Price Index, utilization
rates, number of beneficiaries, etc., will be developed by
the agency and OMB.
c. Other benefit payments. (Including: OASDI;
railroad retirement; Civil Service and military retirement;
supplemental security income; and veterans compensation,
pensions, and readjustment benefits). Benefit payments per
beneficiary should be increased to take into account
increases in the earnings base (where applicable) on which
the benefit is computed, unless' existing law or
Administration-supported legislation provides otherwise.
The projections should be calculated by multiplying the
expected number of beneficiaries in each future year by
average benefit payments per beneficiary. For those
programs for which existing or proposed legislation provides
for automatic cost-of-living adjustments, the result should
further be multiplied by a Consumer or other Price Index
adjustment factor to be supplied by the Office of Management
and Budget. Presidential proposals to increase or decrease
such benefits should be shown separately.
Epecific Instructions
1. Lines should .not be added to or d4leted from the
computer listing. In cases where accounts Must be added or
deleted to make the long-range computer data file consistent
with the current master account title file, .the agency will
include this information'fn.the transmittal letter described
in paragraph (5)R .of this Bulletin.. The memorandum should
include the account title, the 11-digit identification code,
and the estimated budget authority and outlays for 1977
through 1982.
2. When entering amounts on the Long-Range.Data and Update
Form:.
a. If the dollar amount for any year is to be changed,
enter the correct amount in the space immediately below that
number on the line marked "CORRECTIONS" If no change is
needed, leave the space blank on the line below the number;
b. Show the amounts in thousands of dollars;
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c. Specify the number of entries made on each
"CORRECTIONS" line in the column titled "NUMBER OF CHANGES."
Enter "0" if there are no changes.
3. The following regource measure abbreviations are used on
the form:
a. BA -- budget authority
":1
b. OUTLAYS -- outlays
c. PROP LEG (BA) effect on budget authority of
proposed legislation
d. PROP LEG (0) -- effect on outlays of proposed
legislation
e. OFF REC offsetting receipts, either from intra-
governmental transactions or proprietary receipts.
f. PROP LEG (OR) -- effect of proposed legislation on
offsetting receipts.
4. Proposed'lpgislaticn, as used here, means'"proposed for
later transmittal, under proposed legislation..." Proposed
legislation in the out-years should be treated in the same
manner as in the budget year, i.e., the changes in budget
authority and outlays-attributable to 'proposed legislation
*should be ideptitied separately, in thq line(s) for proposed
legislation in all of the affected' xears. For example, ? in
Exhibit 1 (Operating Expenses) the changes caused by the
proposed legislation are reflected only in lines 140800 and
141000.
5. Generally, offsetting receipts have been aggregated at'
the agency level and split by subfunction .and
controllability code. These codes appear directly to the
right of the resource measure abbreviation (e.g., "OFF REC")
on each line of the listing.
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LONG RANGE DATA ANO UPDATE PORN AS OF 03/16/77 17:43
RIERARED By: 6 NUmBER 1977 1978 1979
EX.FLA.4-?,-,-1111 OF CURRENT CURRENT CURRENT
TELEM CHNGES ESTIMATE ESTIMATE ESTIMATE
1980
CURRENT
ESTIMATE
1981
CURRENT
ESTI4ATE
C
Exhibit 1
Bulletin No.77-10
1982
CURRENT
ESTIMATE
NOTE: IF ANY AMOUNT FIELD ON THIS PRINTOUT IS CORRECT AS SHORN, THEN LEAVE BLANK THE CORRESPONDING AMOUNT POSITION ON THE FOLLOW-
ING DUPLICATE LINE LABELLED 4CURRECTIONS4.0THERWISE, THESE CORRECT AMOUNTS WILL BE RE-ENTERED NEEDLESSLY. IF ANY AMOUNT IS INCORRECT
AS SHOWN, THEN ENTER THE CORRECT AMOUNT IN THE CORRESPONDING POSITION ON THE FOLLOWING DUPLICATE LINE LABELLED "CORRECTIONS". EACH
AMOUNT FIELD IS PRECEDED BY A FIELD COOE(I.E.. 24,26.28,30,32,341.THESE CODES ARE FOR KEYPUNCHING PURPOSES (THEY 00 NOT REPRESENT
BUDGET DATA AMOUNTS1,THEREFORE, PLEASE IGNORE THEM. COLUMN 6 SHOWS THE SUBFUNCTION CODE FOR EACH LINE ITEm. FOLLOWING IT IS THE CON-
TROLLABILITY CODE. BE SURE TO INSERT AMOUNTS IN 110005 AND FILL IN YOUR NAME AND PHONE NUmBFII IN THE SPACE PROVIDED ABOVE.THANK YOU.
OPERATING EXPENSES
( LATEST ESTIMATES
140700. BA 1406112651
CORRECTIONS
F 140700 ? BA (406)12651
140800 PROP.LEG.BA1406112651
' CORRECTIONS
140800 PROP.LEG.841406142651
LATEST ESTIMATES
140900 OUTLAYS (406112651
CORRECTIONS
140900 OUTLAYS 14061(265)
141000 PROP.LE0.0 1406112651
CORRECTIONS
( 141000 PROP.LEG.0 (4061(2651
TOTAL BA
( TOTAL PROP.LEG.BA
TOTAL CUTLAYS
TOTAL PROP.LEG.0
TOTAL BA1NET1 .
TOTAL CHNET1
ACQUISITION, CONSTRUCTION, AND
LATEST ESTIMATES .
141100 BA (406)12651
CORRECTIONS
141100 ' BA 140611265/
LATEST ESTIMATES
? . .
(24)
.
t38400
126/
. .
875055 1281
902000
(301
925000
1321
950000 1341
4
1241
23200
(261 .
in.5060(291
cloaca? (30)
920000
1321
14000(341
(24)
121/j
-700 1281
1313/
(32)
1341
3
1241
1281
-600(281
- 600
(30)
-600
132/
.-400
(341
(24)
83566
1261:
871755 1281
995000
1301
920000
132/
945000
134/
0
1241
(261
128)
1301
(321
(34)
.
-
(24)
(26)
-700 (281
(30)
132)
(34)
2.
1241
126)
' 128/
130/
1321
*- get
(34)
838400
875055
902000
925000
9.50000
.
-700
835600
871755
895000
920000
945000
-700
83g400
874355
902000
925000
950000
835600
871055
895000
920000
945000
... .
IMPROVEMENTS
(241
236000
126/
226600 1281
226000
1301
225000
1321
225000
1341
c)
(241
126)
. 1281
(301
(32)
134/
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975000
976000
?
41.-- 465
970000
975000
970000
975000
970000
225000 .
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0
ATTACHMENT B
Bulletin No. 77,10
INSTRUCTIONS FOR REPORTING
ESTIMATED SPENDOUT OF BALANCES OF CONTROLLABLE PROGRAMS
1. Purpose. This attachment provides instructions for
Preparing the report on estimated spendout of 1978 balances
bf controllable programs..
2. CoveLue. This report will be prepared only by agencies
that III-hive unexpended balances (the sum of obligated and
unobligated balances) at the end of 1978 in excess of $100
million. Additional detail will be required for:
a. bureaus with account balances at the end of 1978 of
more than $1 billion;
b. appropriation accounts
Defense) with 1978 year-end
million;
(excepting the Department of
balances of more than $100
c. accounts. with balances of standby
authority, i.e._ authority that would not be
meet conditions or circumstances that may not
When the detail required by..2a-c does not, add
total, an additional--".all other line will
identify the remainder.
and. back-up
used except to
occur.
to the agency
be provided. to
3. Re2ortin2 process. Affected agencies will be furnished
a listing of accounts with unexpended balances of $20
million or more, together with information from the January
budget data file on estimates of unexpended balances and
spendout from balances for 1976, TQ, 1977, and 1978.
(OMB
did mot collect this information for the February budget
revisions.)
? Agencies will report, in the format of Exhibit 2, the
.,current estimates of:
a. 1978 year-end unexpended balances for the accounts
included on the listing furnished by OMB together with such
additional entries necessary to effect Congressional action
Or inaction or Administration initiatives. Current
estimates of unexpended balances for other items may be
furnished if deemed necessary;
b. spending from those balances in fiscal years 1979,
1980, 1981, and 1982;
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c. balances remaining as of September 30, 1982; and
d. balances lapsing .during the period 1979 through
1982.
These estimates will be consistent with estimates or
reestimates provided in accordance with Section 5 of this
Bulletin.
4. Basis for the estimates. The report will relate to
"controllable" programs only (i.e., those shown in the
attached computer listing). Programs classified as ' "open-
ended programs and fixed costs" in Summary Table 16 of the
1978 Budget are specifically excluded; therefore the report
will not contain all balances, and will not agree with the
totals shown in Summary Table 10.
For the purpose of this report, the term "spendout" means
gross disbursements; it, is not synonymous with the term
"outlays" which means checks issued, net of receipts and
reimbursements. It is essential that the spendout report
disregard receipts and reimbursements and record gross
disbursements against unexpended balances'. This distinction
is particularly important for revolving funds or accounts
where reimbursements represent a major aspect of the
financial program.
In estimating the amount of spendout of 1978 balances in
each of the fiscal years 1979-1082, the following
assumptions should be used:
a. Obligated balances carried forward at the end of
1978 generally :will be spent out in 1979. Important
exceptions are accounts having a long time lag between
obligation and disbursement, e.g., construction and major
procurement programs.
b. Unobligated balances will be obligated before new
authority, and generally will be spent out within a year
after the obligation is incurred, except as noted in.
paragraph 4a above. Estimates of the spendout of these
balances can usually be based on assumptions concerning
obligation levels in 1979 and each year thereafter.
Important exceptions include some "earmarked" funds (i.e.,
dedicated revenues), which will have to be reviewed
separately, and accounts with balances of:
(1) funds that will lapse;
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(2)
receipts; or
authority to spend agency or public debt
(3) contract authority.
S. Required information. Specific instructions foi
completing the report are set forth below.
Description (col. 1) -- This column should include the
same stub entries contained in the computer listing provided
by OMB, together with such additional entries as are deemed
desirable.
January Budget estimate (col. AI -- This column should
contain the amounts provided in the computer listing.
Current estimate (col. 3) -- The latest estimate of 1978
balances is equal to the January budget estimate modified to
reflect subsequent changes due to congressional action (or
inaction), reestimates, or Administration initiatives.
These amounts must be consistent with the effects of any
1977 or 1978 reestimates reported elsewhere for the Mid-
Session Review.. Assuming no changes in estimates of
expiring authority and of receipts and reimbursements,
changes in estimates of budget authority and outlays will
have a direct sffec,t on the estimate of the unexpended
balance (i.e., an inergaSi in budget authority will result
in an equal increase in unexpended balances; while an
increase in outlays will result In an equal decrease in
unexpended balances).
Spendout from 1978 balances in 1979-82 (cols. 4-7) --
Enter the amount of Spendout of 1978. year-end balances,
estimated for each of the fiscal years 1979-1982. ?
1978 balances as of 9/30/82 (col. 8) -- The amount .of
. 1978 balances remaining unexpended at the end of 1982 will
include the balances of standby. and back-up authority that
will not be used in the foreseeable future. Expiring
balances will be excluded. Footnotes will be included to
explain any balances in excess of $50 million, except for
amounts applicable to standby or back-gp authority.
1978 balances expiring in the 1979-1982 period (col. 21
-- Enter the amount of 1978 balances that will expire unused
in any of the fiscal years 1979-1982. Footnotes will be
included to explain lany such balances over $50 million. The
amount in column 3'should be equal to the sum of the amounts
in columns 4-9.
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Description
(I)
ESTIMATEDSPENDOUT OF BALANCES OF CONTROLLABLE PROGRAMS.
FROM 1978 ENDOF-YEAR UNEXPENDED BALANCES OF BUDGET AUTHORITY
1978 ending balances
January
Budget Current
estimate estimate
(2) (3)
(in millions of dollars)
Spendout from 1978
balances in:
1979 1980 1981 1982
(4) (5) (6) (7)
1978
balances.as of
9/30/82 ?
(8)
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Exhibit 2
Bulletin No. 77-10
1978 balances
expiring in the.
1979-82 period
(9)
fl
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Department of Government
Analysis of Changes
(in millions of dollars)
1977
Budget
Authority
EXHIBIT
Bulletin No. 77-10
1978
Budget
Outlays Authority Outlays
February budget estimate
Effect of Administration revisions
?to proposed legislation
7,124 6,832
200 30,
7,512
7,410
150
Reestimate of outlays in con-
struction accounts
-75
45
?
April estimate
7,324 6,787
7,512
7,605
Congressional increase in Supple-
mental Appropriations Act, 1977
120 80
40
Reestimate of offsetting receipts.
-60 -60
35
35
All other changes, net
. -17
Current estimate
7,384 6,790
7,547
7,680
Note: Changes identified
in this exhibit are examples only.
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4? n
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141?)P72-0:-It\
WA") OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20509
Bulletin No. 77-9
April 19, 1977
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Zero-Base Budgeting
1. Purpose. The President, in a memorandum of February 14,
1977 (Attachment), asked each agency head to develop a zero-
base budgeting system to be used in the preparation of the
1979 Budget. In accordance with the President's direction,
these instructions provide guidance on the use of zero-base
budgeting techniques for the preparation and justification
of 1979 budget requests within each agency. Separate
instructions will be issued in OMB Circular No. A-11 to
advise agencies of budget materials to be submitted 65 OMB.
The instructions in this Bulletin lay the foundation for
agency budget submissions in September in accordance with
Circular No. A-11.
2. Coverage. These instructions apply to all agencies in
the executive branch whose budgets are subject to
Presidential review (see OMB Circular No. A-11, section
11.1). These concepts and guidelines are a framework within
which each agency should develop necessary procedures to
meet its individual requirements. Agencies should insure
that the fundamental characteristics of zero-base budgeting
are retained. Agencies excluded from the coverage of this
bulletin are encouraged to develop zero-base budgeting
procedures.
3. Definition of terms.
a. Decision unit. The prograsa_sir_str.g_aniza.tiknal.p.t..ity
for which budgets _are,p,rppared and for which a manager makes
significant.decisions on the amount of spending and the
scope or quality of work to be performed.
b. Decision package. A brief justification document
that includes the information necessary for managers to make
judgments on program or activity levels and resource
requirements. Es_aesies_91. cic?jsinn _packages_la. degi5j211
package spt) is prepaucl for_eaph idpcipion unit and
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cumulatively represents the total budget r.equest for _that
unit.
c. Consolidated decision packages. Packages prepared
at higher management levels that summarize and supplement
information contained in decision packages received from
lower level units. Consolidated packages may reflect
different priorities, including the addition of new programs
or the abolition of existing ones.
? d. Ranking. The process by which managers array
program or activity levels (as shown in decision packages)
in decreasing order of priority. This ranking process
identifies the relative priority assigned to each decision
package increment contained in the manager's budget request
based on the benefits to be gained at and the consequences
of various spending levels.
e. Minimum level. The program, activity, or funding
level below which it is not feasible to continue the
program, activity, or entity because no constructive
contribution can be made toward fulfilling its objective.
The minimum level:
-- may not be a fully acceptable level from the program
manager's perspective; and
-- may not completely achieve the desired objectives of
the decision unit.
f. Current level. The level that would be reflected in
the budget if fiscal year 1978 activities were carried on at
1978 service or other output levels without major policy
changes. A concept, not unlike current services, that
nevertheless permits internal realignments of activities
within existing statutory authorization. Estimates of
personnel compensation and other objects of expenditure will
be made in accordance with OMB Circular No. A-11.
4. The zero-base budgeting concept. Zero-base budgeting is
a management process that provides for systematic
consideration of all programs and activities in conjunction
with the formulation of budget _requests and program
planning.
The principal objectives of zero-base budgeting are to:
-- involve managers at all levels in the budget
process;
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-- justify the resource requirements for existing
activities as well as for new activities;
-- focus the justification on the evaluation of
discrete programs or activities of each decision unit;
-- establish, for all managerial levels in an agency,
objectives against which accomplishments can be identified
and measured;
-- assess alternative methods of accomplishing
objectives;
-- analyze the probable effects of different budget
amounts or performance levels on the achievement of
objectives; and
-- provide a credible rationale for reallocating
resources, especially from old activitites to new activites.
To accomplish these objectives zero-base budgeting requires
these decision-makers to:
-- use "decision packages" as the major tool for
0 budgetary review, analysis, and decisionmaking; and
-- rank program or activity levels in order of
priority.
5. Benefits anticipated in the Federal Government. This
new system can provide significant benefits at all levels
throughout the Federal Government. These benefits include:
-- focusing the budget process on a comprehensive
analysis of objectives, and the development of plans to
accomplish those objectives;
-- providing better coordination of program and
activity planning, evaluation, and budgeting;
expanding lower level management participation in
progam and activity planning, evaluation, and budgeting;
-- causing managers at all levels to evaluate in detail
the cost effectiveness of their operations and specific
activities--both new and old-- all of which are clearly
identified;
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requiring that alternative ways to meet objectives
are identified;
identifying trade-offs between and within programs;
and
. -- providing managers at all levels with _better
information on the relative priority associated with budget
requests and decisions.
Many agency management processes are aimed at providing some
if not all of these same benefits. In many instances,
however, such processes do not operate agencywide and the
information relevant to the processes is not gathered,
analyzed and reviewed in a systematic manner for all
programs and activities. The value of zero-base budgeting
is that it provides a process requiring systematic
evaluation of the total budget request and all program
objectives.
6. The zero-base budgeting process. Agencies should
develop their internal zero-base budgeting procedures within
the following framework.
a. Identification of objectives. An important early
step in zero-base budgeting is the identification of
objectives for all managers preparing and reviewing decision
packages.
Top level agency management should be involved in setting
objectives for lower level agency managers to:
(1) help ensure that appropriate guidance is
furnished to managers throughout the agency;
(2) aid managers preparing decision packages in
defining, explaining, and justifying their work to be
performed and the associated resources; and
(3) aid top and intermediate level managers in
understanding and evaluating the budget requests.
Program and organization objectives should be explicit
statements of intended output, clearly related to the basic
need for which the program or organization exists. The task
of identifying objectives requires the participation by
managers at all levels to determine the ultimate realistic
outputs or accomplishments expected from a program or
organization (major objectives) and the services or products
0
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to be provided for a given level . of funding during the
budget year (short-term objectives).
However, lack of precise identification and quantification
of such objectives does not preclude the develOPMent and
implementation of iero-base budgeting procedures.
As objectives are identified, managers should simultaneously
determine the key indicators by which performance and
results are to be meaSured. Agencies. should specify
measures of effectiveness, efficiency, and workload for each
decision unit. These measures can often be obtained from
existing evaluation and workload measurement systems. If
such systems do not exist, or if data are not readily
available, desirable performance indicators should not be
rejected because of apparent difficulties in measurement.
Indirett or proxy indicators should be Considered initially,
while evaluation and workload systems are developed to
provide the necessary data for subaequent budget 'cycles.
b. Identification of decision units. Another of the
first steps in zero-base budgeting is the identification of
the entities in the program or organization structure whose
managers will prepare the initial decision packages. In all
instances, the identification of the decision units should
0 be determined by the information needs of higher level
management. Agencies should ensure that the basic decision
units selected are not so low in the structure as to result
in excessive paperwork and review. On the other hand, the
units selected should not be so high as to mask important
considerations and prevent meaningful review of the work
being performed. In 'general, the decision unit ahould be at
an organizational or orpgxam. -thiTman54ei
-u-Lat-e-?qi.oL4,c.si,09,ns... nthonjtof
?.22pe, iilre,ieCatA._szi.J.,...q.C.q:L.kaLtV.,,o.f,,w_oci.c___..t9,..,.1?sc?pect.o,Frii0.- "A
decis u
ion 'nit noimalli Should be included within a single
account, be classified in only one budget subfunction, and
to the extent possible, reflect existing program and
orgahizational structures that have accounting support.
c. Preparation of decision packages. The decision Unit
manager performs two types of analyses based on the program
and budget guidance received from higher level management.
First., the manager examines alternative ways .of
accomplishing the major objectives. Such alternatives may
require legislation and may have been identified and
deve3oped as 4 result of a major reexaMination of the
0rogram or activity. In other instances the alternatives
identified may not be fully developed, bilt Will'seive as-a
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basis for reexamining the program at a later date. In still
other instances, the alternatives identified may be the
first steps toward more significant changes that will take
longer than one year to accomplish. Normally, the hest
alternative is then selected and used as the basis for the
second 'type of analysia?the identification of different
levels of funding, activity, or performance, The purpose of
identifying these different levels is to provide information
On:- (1) where reductions from the total request .may be
made, (2) the increased benefits that can be achieved
through additional or alternative spending plena, and. (3)
the effect/ of such addition!: and reductions, . .Again,
legislation may be reqUired te pUt.into.effect-SOMe level Of
funding or performance.
However, nothing in this process should inhibit or ?prohibit
any decisionmaker from Submitting, requesting, or reviewing
any informatioh needed for.anilypes and decitionmaking. For
example, separate dedision package sets Maybe prepared to
examine ? the impact of different. alternatives. Also,
packages reflecting increased performance or funding .leveis
may introduce. alternative methods of aCcOMPlishiienflhat
were not feasible at a lower level. -
The guidance received frbm higher level management may
determine the specific service, performance, output,' or
funding levels and the objectives to be discussed. This
helps to. insure that information provided in the decision
package is broken doWn and arrayed in a manner conducive to
higher level review of issues concerning the decision unit
and also covering More than .one decision unit. poweyei, in
all instances the decision Package Set should include:
(1) A minimum level. In all instances, the minimum
level should be below the .current .level. (unless it- is.
clearly not feasible to operate.boloW the cuirentleVel);:.
and
(2) A current level (unless the total requested for
the decision Unit iS below the current level).
The'decision package set may also include, when appropriate:
(1) A level or levels .between the minituth and
current leVels; and
(2) Any additional increments desired above the
current level.
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Proposed changeS (supplementals, amendments, rescissions) in
current year amounts should be shown in packages separate
from the packages described above. However, the above
packages should include any budget year effect Of current
year changes. New programs or activities (e.g., those
resulting from new legislative authority or a new major
objective) will be proposed in a separate decision package
set. Proposals for abolition of current programs .or
activities normally will not be reflected in a decision
package set. ..however, such proposels.Should be highlighted,
as appropriate, in another part of the agency juStification..
The decision unit manager prepares a decision package set
that includes decision packages reflecting incremental
levels of funding and performance, so the cumulative ameunt
of all packages represents the total potential budget
request of the decision unit. Each package shows the effect
of that funding and performance level on .meeting the
assigned objectives. The decision packages serve as the
primary tool for budgetary review, analysisi: and
detisionmaking, although additional Material may also be
made available or requested for review. ?
Generally, . a series of packages should be prepared for all
programs and activities where, through legislative or
administrative means, there is discretion as to the amount
of funds to be. spent or the appropriate method or level of
activity. This does not mean that where a spending level is
mandatory under existing substantive law, only one level
will be identified. There are many instances in? which the
.decision On Whether to propose legislative changes is..made
during the preparation. of the budget. There are 'also
instances in which changes in regulations or program
administration can affect the amount of resources needed to
carry out a mandatory program. .In these inetances, packages
:should be prepared that analyze the effects of different
funding or performance levels or alternative methods :of
accomplishing the objectives. In any instance where there
is clearly no discretion in the amounts of funds to be spent
or the appropriate method or level of. activity, at least one
decision package should be prepared that summarizes the
analysis and decisionmaking that resulted in that request.
That decision package should support . the conclusion that
only one funding or activity level can be coneidered:during
the budget process.
d. Ranking of.decision Reckages. .Completed decision
packages should be ranked initially by the decision unit
manager. At higher Management levels, the rankings of each
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subordinate manager are reviewed and formed into a
consolidated ranking. This consolidation process is
illustrated in Exhibit 1. The ranking shows the relative
priority that discrete increments of services or other
outputs have in relation to other increments-04.eervices or
other outputs. The process is explicitly deeignedcto all-ow
higher level managers the opportunity to bring their broader.
perspectives to bear on program prioritiee by. allowing :Ahem
to rank the decision packages*and.make programHtradeoffs.
Agencies may bee whatever .review and ranking teChniques
appropriate to their needs. However, the minimum level for
a decision unit is always ranked higher than any increment
for the same unit, since it represents the level bele/UT Which
the activities can to longer be .conducted .effectiVely.
However, the minimum level patXage for a_given decision link_
need not_bejanked.higher than_an.indremental.level ofeopp_
other decision unit. A minimum level for?a?decision unit
71-4,- be tanked so low in comparison to incremental levels of
other decision.units that the funding level for the: agency
may exclude that. mintmuth.level,package., This would eignify
the loss of funding for that decision. unit;
Decision packages or decision package sets may be. prepared
to examine the effect of alternative ways to. meet an
objective (see Section 6.c.). In these instances, only
those decision packages that are. part of the.unit's'requeSt
should be ranked. The other decision .packages should
accompany the submission, however, so higher review.levels
may examine the.alternatives and .have ?opportunity:
replace .the requested.. packages with those representing an -
. ? ? .
alternative thus far not reaomMended.
e. Eicher level review. In all instances, the use of
decision--Flaages.ana70776r1,ty
rankings are.the.major toole.. -
for analysis, revieWi. and decisionmaking. At eadh. higtier,
manageMent level:
.deCisiOn.paCkages may be revised, deleted Or added;
and
-- rankings subMitted by subordinate 'Manager's may
revised.
?
(1) Collsolidation of deciscon. packages. In some
small agencles:--r?may ?be desirable for each. higher
menagament level to review every decision package .prepared:
by each decioion unit i In other instances, .however, higher
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level management's decisionmaking needs may better be met by
recasting all or some of the initial decision packages into
a lesser number of consolidated decision packages. The
consolidated packages would be based upon the more detailed
information in the initial packages, but the information
would be recast or reinterpreted in a broader frame of
reference to focus on significant program alternatives or
iSsues. The objectives may be redefined to reflect the
higher level manager's program perspective.
This consolidation process may also be used to reduce what
would otherwise be an excessive paperwork and review burden
at higher levels. The agency head or his designee should
determine at which review level(s) all or some of the
packages will be consolidated into a lesser number of
.packages before submission to the next higher review level
(see Exhibit 1). This consolidation should be based on
natural groupings of subordinate decision 'units. Decision
units in different budget subfunctions generally should not
be consolidated. The consolidated package will summarize
the more detailed information contained in the individual
packages and identify the subordinate decision units
covered.
In all instances a minimum level consolidated decision
package will be prepared. This package may or may not
include each of the minimum level packages from the decision
package sets being consolidated. There will be instances
when the preparation of a current level consolidated package
is not feasible (e.g., when a decision package for a new
program or activity is ranked higher than a current level
package). When appropriate, there should also be a level or
levels identified between the minimum and current levels.
(2) Type of review. The review can be conducted
more effectively at each management level if the type of
review is determined beforehand. This is especially
important in the mid and higher levels in the agency, where
the review workload may be significant, even with
consolidation of packages. As a means of increasing the
effectiveness of its review, higher level management may
decide to limit its review of the higher-ranked packages to
that necessary to provide a sound basis for ranking the
packages . and may choose to examine in more depth only the
lower-ranked packages. The lower-ranked packages would be
the first to be affected by an increase or decrease in the
expected budgetary resources.
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7. Preparation of materials. The following materials
should be prepared for each decision unit.
a. Decision unit overview. The overview provides
information necessary to evaluate and make decisions on each
of the decision packages, without the need to repeat that
information in each package. It should be at most two pages
long, prepared in the format of Exhibit 2, and contain the
following information:
(1) Identifying information. Include sufficient
information to identify the decision unit, and the
organizational and budgetary structure within which that
decision unit is located. Each package should include the
title of the appropriation or fund account that finances the
decision unit, the account identification code (see OMB
Circular No. A-11, section 21.3), and any internal agency
code necessary.
(2) Long-range goal. When appropriate, identify
the long-range goal of the decision unit. Goals should be
directed toward general needs, to serve as the basis for
determining the major objective(s) undertaken to work
towards that goal.
(3) Major objective(s). Describe the major
objectives of the decision unit, the requirements these
objectives are intended to satisfy and the basic authorizing
legislation. Major objectives normally are of a continuing
nature or take relatively long periods to accomplish.
Objectives should be measurable and should be those that
program managers employ; they should form the basis for
first determining and subsequently evaluating the
accomplishments of programs or activities.
(4) Alternatives. Describe the feasible
alternative ways to accomplish the major objectives.
Identify which of the alternatives represents the method
proposed for the budget year. Briefly explain how the
approach selected contributes to satisfying the major
objectives and the rationale for not pursuing other
alternatives. This may include a discussion of
organizational structure and delivery systems; longer-range
cost factors; and when applicable, the unique aspects and
need for the program that cannot be filled by State or local
governments or the private sector (particularly for any
enlarged or new proposed action).
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(5) Accomplishments. Describe the progress of the
decision unit toward meeting the major objectives. This
section should include both quantitative and qualitative
measures of results.
b. Decision packages. Each (consolidated) decision
package should be no more than two pages long, be prepared
in a format similar to Exhibit 3, and contain at least the
following information:
(1) Identifying information. This information
should include organizational identification (aqencY,
bureau), appropriation or fund account title and
identification number, specific identification of the
decision unit, the package number, and the internal agency
code.
(2) Activity description. Describe the work to be
performed or services provided with the incremental
resources specified in the package. This section should
include a discussion and evaluation of significant
accomplishments planned and the results of benefit/cost and
other analyses and evaluations-MT-7pin contribute to the
justification of that level.
(3) Resource requirements. Include appropriate
information, ---itraes oftigations, offsetting collections,
budget authority or outlays, and employment (full-time
permanent and total), for the past, current, and budget
years for the upcoming budget. The increment associated
with each package should be listed, along with the
cumulative totals for each measure used in that package,
plus all higher ranked packages for that decision unit. At
an appropriate level in the process, budget authority. .and,
outlay amounts for the four years beyond the budget year'
should also be included, in accordance with criteria in OMB
Circular No. A-11.
(4) Short-term objective. State the short-term
objectives (iFigr17,---aschievable within one year), that will
be accomplished and the benefits that will result with the
increment specified and the cumulative resources shown in
the package. The expected results of the work performed or
services provided should be identified to the maximum extent
possible through the use of quantitative measures.
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(5) Impact on malor objective(s). Describe the
impact on the major objective(s) or goals of both the
incremental and the cumulative resources shown in the
package.
(6) Other information. Include other information
that aids in evaluating the decision package. This should
include:
?. -- explanations of any legislation needed. inconnection
with the package;
-- the impact or consequences of not approving the
package;
-- for the minimum level package, the effects of' zero-
funding for the decision unit;
-- for packages below the current level, an explanation
of what now is being accomplished that will not be
accomplished at the lower level; and
-- the relationship of the decision unit to other
decision units, including the coordination that is reauired.
c. Ranking sheet. Each review level will prepare a
ranking sheet to submit to the next higher review level.
This ranking sheet should generally contain the information
shown in Exhibit 4 for the budget year.
In instances (e.g., revolving funds) where budget authority
and net outlays are not a factor in reqecting the
appropriate or priority level of performance, managers
should use other measures (e.g. total obligations,
employment).
'B. OMB review and consultation. As an important element of
initiating zero-base budgeting, agencies are required this
year to submit for OMB and Presidential review their
proposals for:
-- the program, activity, or organizational level to be
the basis of the (consolidated) decision packages that will
form the agency budget submission to OMB;
.current and/or budget year issues that should be
highliOted through either particular decision packages or,
when decision packages are not appropriate, through issue
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papers that ultimately tie in to one or several decision
packages; and
-- longer-range issues for which agencies will initiate
extensive evaluations.
This identification of issues will play an integral role in
OMB's spring review of agency programs, activities, and
plans. Policy guidance letters to the agencies regarding
the preparation of the fall budget submission will be based
in part on this information.
OmB representatives will contact the agencies shortly and
request these proposals.
9. Inquiries. Shoulo additional discussion be necessary,
agencies should contact their OMB budget examiner.
Bert Lance
Director
Attachment
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DECISION PACKAGE RANKING AND CONSOLIDATION PROCESS ILLUSTRATED
Managers A, B. and C each
rank packages for their
units and send to Manager X
Decision
Unit A
Decision
Unit B
Decision
Unit C
Package Funding Funding
4 increment Total
Manager N receives parkag.,s
and evaluates and ranks
them within each unit
Revised
Package Funding Funding
increment total 1/
Manager X ranks packages
for units A, B, and C
against each other, and
sends to Manager R
ilanager X
Al
100
led
A2
5
105
A3
30
135
A4
15
150
Manager R evaluates packages
from Managers X and Y, and
then ranks them against each
other
B4
?35
?--
Cl
C2
C3
C4
C5
C6
C3
C4
C5
Manager Y
1 X1
2 X2
3 11
4 Y2
5 13
6 14
7 15
9 y7
10 x3
12 X5
13 ?X6
14_ X7
15 X8
16 19
17 Y8
18 19
20 XII
21 X12
22 X13
2
? EXHIBIT 1
BULLETIN NO. 77-9
Manager R prepares some
consolidated decision pack-
ages before submitting
budget request to next
higher level
RI
xI-x2
Yl-y2
R2
_1
Y3-Y7
R3
X3-x9 ?
-
R4
Y8-Y9
R5
X10
R6
X11-X14
1./ Higher level manager reorders the proposed priorities flf the subordinate decision unit managers. The packages may be revised by either the initial
decision unit manager or the higher level manager.
2i Higher level manager accepts proposed priorities of the subordinate manager.
2/ Higher level manager accepts proposed priorities of the subordinate manager, but chooses not to propose funding of lowest priority package.
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Naair
DECISION UNIT OVERVIEW
Department of Health, Education, and Welfare
Mental qealth Administration
Federal Support of Community Mental Health Services.
Mental Health: 75-0001-0-1-550
Goal.
Bulletin No. 77-9
Exhibit 2
To ensure needy citizens access to community based mental health services, regardless of
ability to pay. Services should be of high quality, provided in the least restrictive
environment, and in a manner assuring patients' rights and dignity.
Major objective.
To assist in the establishment and operation of a nationwide network of 1,200 qualified
community mental health centers (CMHCs) by 1984 to ensure availability and accessibility
of services to residents of each mental health catchment area.
Current method of accomplishing the major objectives.
Grants are made to public and nonprofit entities to plan and operate community mental
health center programs. The planning grants are one-time grants, not to exceed $75,000
eacn. The operating grants are for eight-year periods with a declining Federal matching
rate.
Alternatives.
. . .
1. consolidate Federal funding for commtmity mental health services and other categorical
healfn service programs into a single formula grant to the States.
2. Consoliaate Federal funding for community mental health services and other community-
cased inpatient and outpatient services--as well as institutionally basea short-term acute
and long-term care services--for the mentally ill and mentally retarded.
These alternatives are not being pursued because the States thus far have not been able to
ensure that funds will be targeted into high priority areas. The Secretary believes the
Federal Government must have the ability to control the funding.
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2
3. Provide for mental health services coverage through the national health insurance
proposal. This alternative is not presently viable because passage of the national health
insurance act is not near. Intensive study is now being directed toward this alternative
for possible consideration next year.
Accomplishments.
Since the establishment of the CMHC program in the mid-1960's, 670 CMHC's have received
Federal funding of nearly $2.0 billion. In 1977, nearly 600 centers were operational,
covering 45% of the population (90 million people), and providing treatment services to 2
million individuals annually.
.%
In 1977, 450 centers received Federal grant support and 100 centers completed the eight-
year Federal grant cycle. To qualify for an operational grant, P.L. 100-63, requires
centers to provide the following services on a 24 hour a day, seven day a week basis:
1. Inpatient hospitalization;
2. Outpatient treatment and counseling;
3. Partial hospitalization as an alternative to full-time hospitalization;
4. 24-hour emergency services by telephone or on a walk-in basis;
5. Consultation and education services;
6. Services to children;
7. Services to the elderly;
8. Screening services to the courts and other agencies;
9. Follow-up care for former full-time patients from a mental health facility;
10. Transitional services for same;
11. Alcoholism and alcohol abuse program and drug addiction and abuse program.
o 0
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,har.
Package 1 of 4 (minimum level)
DECISION PACKAGE
Department of Health, Education and Welfare
Mental Health Administration
Federal Support of 'ommunity Mental He.lth Servt es
Mental Health: 75-0001-0-1-550
Bulletin No. 77-9
Exhibit 3
Activity Description:
Continue grants only the 4,0 i:0111C's currently receiving Federal support, until each CMHe's eight-year grant cycle is
completed.
Resource Requirements:
Dollars (in thousands)
1971 1978
1979
This
Package
Cumulative
Total
Planning grants (4)
1,000
1,000
0
. 0
Operating grants ($)
97,000
147,000
120,000
120,000
Total obligations
98,000
148,000
120,000
120 000
---1
Budget authority
98,000148,000
120,000
124,000
Outlays
97,000
145,000
119_,Gou
119,00y
Five-year estimates
?
1979
1980
1981
1982
1983
'Budget authority
1207000
10U76-60
-10-,000
-3-6,000
40,000
Outlays
119,000
98,000
79,000
59,000
40,000
Short-term objective:
To ensure in 1979 access to qualified comprehensive mental health services to 458 of the population (this results in
treatment of about 2 million patients).
Impact on major objectives:
The :neje: objective of 1200 qualified CMFIC's by 1988 would not be met if this short term objective were continued. It
is unlikely that any net increase in qualified CMHC's would result at this level oecause few communities have the
resoutnes to develop a qualified program. It is estimated that for each community that would develop a qualified CMHC;
an ct.sting qualifieo CMHC would cease to qualify because of cutbacks in service provided due to tight funds. The
impact ol continuing this level objective follows:
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1977
1978
1979
1980
1981
1982
1983
1984
Number of public and non-
profit CMHC's
700
710
720
730
740
750
760
770
Number of CMHC's providing
comprehensive services,
as now defined
550
600
600
? 600
600
600
600
600
Number of CMHC's receiving
grants
400
450
400
350
300
250
200
150
Percent of population
covered
43
45
45
45
45
45
45
45
Percent of probable patients
covered
45
50
50
50
50
50
50
50
Other Information:
Continuing grants to the 450 CMHC's currently receiving Federal support until
is the minimum level because (a) the government has an eight-year contract
receive any grants. If zero-funded, the government would be subject to legal
each CMHC's eight-year cycle is completed
with each CHMC, and (b) no new CMHC's will
action brought by CMHC's.
This level would cease to encourage communities to develop CMHC's because of the (a) lack of planning grant funds and
(b) lack of operational grant funds, thus negating the potential growth in the number of qualified CMHC's.
Only 57% of the high priority catchment areas would receive qualified CMHC coverage.
0
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Bulletin No. 77-9
Exhibit 3
Package 2 of 4
DECISION'PACSAGE
Department of Health, Eoucation, and Welfare
Mental Health Administration
Federal Support of Community Mental Health Services
Mental Health: 75-0001-0-1-550
Activity Description
Continue grants to a total of 450 C.vntly funded CMHC reaches the end of its eight-year
cycle for eligibility, provide an eight-year grant to a newly aualified CMHC.
Resource Reguirements:
Dollars in thousands.
1977 1978
1979 .
This Cumulative
Package Total- ..-
Planning grants (8)
1,000
1,000
0 0
Operating grants (8)
97;000
147;000
.20;000 140;000
Total obligations
31-70,
148;000
.20;000 140;000
Budget authority
98,000
000
.20000 140,000
Out lays ' ?
97,000
145.000
19.000 138.000
Five year estimates
1975
1980
1981 1982 1983
Budget authority
14E00
141700
1437000 145700 14C-0-60
Outlays .
138,000
141,000
142,000 144,000 145,000
Short-term objective.
To ensure in 1979 access to Qualified comprehensive mental health services to 49% of the pooulation (this results in
treatment of about 2.1 million patients).
ImIEL on major objectives.
Even without the planning grants, many communities will be encouraged to develop CMHCs because of the possibility of
receiving the operating grants. However, the major objective would not be met at this level of funding. It would take
until about 1990 to establish 1200 gualified CMHCs. The impact of continuing this level follows:
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This
1979
1977
1978
package
cumulative
1980
1981
1982
1983
1984
Number of public and
nonprofit CMHCs
700
710
40
750
800
850
900
950
1,000
Number of CMHCs providing
comprehensive services,
as now defined
550
600
50
650
700
750
800
850
900
Number of CMHCs re-
ceiving grants
400
450
50
450
450
450
450
450
450
Percent of population
covered
43
45
4
49
58
65
75
80
85
Percent of probable
patients covered
45
50
4
54
64
69
80
84
88
2
Other information.
By 1982, 70% of thle high priority catchment areas will have a qualified CMHC. Assuming the objective of CMHCs is
desirable even by 1990, stretching out the program past the major objective date of 1984 will increase total program
costs from $3.6 billion to $4.3 billion due to estimated increases in service costs.
0 0
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Nriv , .
Package 3 of 4.(Current level) .
DECISION PACKAGE
Department of Health, Eduction, and Welfare
Mental Health Administration
Federal Support of Community Mental Health Services
Mental Health: 75-0001-0-1-550
0
Bulletin No. 77-9
Exhibit 3
Activity Description:
Fund 501 more newly qualifying CMHO's. That is, for every two.CMHC's whose eight-year eligibility period ends, fund
three newly qualifying CMHC's.
nesource Requirements:
(Dollars in-thousands)
1977
- 1978
Planning grants (S)
1,000
1,000
Operating grants (5)
97,000
147,000
Total obligations
98,000
146,000
?
Budget authority
98,000
148,000
Outlays
97,000
145,000
. -
-C.-
Five year estimates
1979 1980
1981...
--1982
Budget-authority
150,000
172,000
187750
Outlays I. . . -
,162,000.
148,000 .161,000 -.
? .
.
171,000.7 -.182,000..
. .
Short-term Objective:
To ensure in 1979 access
treatement of about 2.2 million
Impact on Malor Objectives:
to qualified comprehehsive mental
patients).
this
' 1977 ? 1978 '. ' Pkg.
Number of public and non-
profit CMHO's
700
710
25
Number of CHHC's providing
comprehensive services,
as now defined
550
600
25
Number of CMHE's receiving
grants
400
' 450, ?
25
Percent of population
covered
.
43
45 .
?
Percent of probable patients
covered
45
50
1979
This
Package
Cumulative
.Total
0 0
10,000
___ 150,000
10,000 150,000
10,000 150,000
10,000 148,000
-1983
.194,000
, ' 193;000

health services to 5111 of the population (this results in
-
1979
Cum. ? .'1980: 1981 1982 1983 1984
775 850 925 1,000 1,075 1,150
675 750 825 900 975 1,050
475 . 500?. . 525 550 571: 600
65 75 60 85 90
'
56 66 77 83 87 90
Other information:
By 1982 958 of the high priority catchment areas will have a qualified CMHC. If stretched out from.1984to 1986,
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Package 4 of 4
DECISION PACKAGE
Department of Health, Education, and Welfare
Mental Health Administration
Activity Description:
Federal Support of Community Mental Health Services
Mental Health: 75-0001-0-1-550
For every CHMC whose eight year
eligibility periods
ends, fund
two newly qualifying CMHC's.
Resource Requirements: Dollars
in thousands
1977
1978
1979
--
72-Eig
Cumulative
Package
Total
Planning grants ($)
1,000
1,000
0
0
Operating grants ($)
97,000
147,000
10,000
160,000
Total obligations
98,000
148,000
10,000
160,000
Budget authority
98,000
148,000
10,000
160,000
Outlays
97,000
145,000
10,000
_158,000
Five year estimates
1979
1980
1981
1982 1983
Budget authority
160,000
172,000
183,000
193,000 204,000
Outlays
158,000
170,000
182,000
192,000 203,000
Short-term Objectives
To ensure in 1979 access to qualified comprehensive mental health services to 53% of the population
(this results in treatment of about 2.3 million patients). .
Impact on Major Objectives
Number of public and non-
profit CMHC's
Number of CHMC;s providing
comprehensive services,
as now defined
Number of CMHC's receiving
grants
Percent of population
covered -
Percent of probable patients
covered
Bulletin No. 77-9
Exhibit 3
this 1979
1977 1978 pkg. cum. 1980 1981 1982 1983 1984
700 710 25 800 900 1,000 1,100 1,200 1,300
550 600 25
400 450 25
.43 45 2
45 50 2
700 800 900 1,000 1,100 1,200
500 550 600 650 700 750
53 75 80 84 93 100
58 77 82 85 93 100
The major objective will be net at this level of funding.
Other Informaion
(Dv 1982 100% of the high* priority catchment areas will haCti qualified CMHC. Total program cost by 1984
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BULLETIN NO. 77-9
EXHIBIT 4
RANKING SHEET
(Other identifying information)
Rank Decision Package
Department of Government
Fiscal year 1979
BA Outlays
Date:
Cumulative
July 17. 1977
BA Outlays
1
Al
924
901
924
901
2
81
800
785
1,724
1,686
3
A2
121
121
1,845
1,807
4
C1
0
0
1,845
1,807
5
82
30
30
1,875
1,837
6
A3
0
0
1,875
1,837
7
83
30
30
1,905
1,867
8
C2
0
0
1,905
1,867
9
C3
0
0
1,905
1,867
10
A4
22
22
1,927
1,889
11
84
11
11
1,938
1,900
12
C4
0
0
1,938
1,900
13
B5
30
30
1,968
1,930
14
C5
0
0
1,968
1,930
15
C6
0
0
1,968
1,930
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ATTACHMENT
BULLETIN NO. 77-9
THE WHITE HOUSE
WASHINGTON
February 14, 1977
MEMORANDUM FOR THE HEADS CF
EXECUTIVE DEPARTMENTS AND AGENCIES
During the campaign, I pledged that immediately after the
inauguration I would issue an order establishing zero-base
budgeting throughout the Federal Government. This pledge
was made because of the success of the zero-base budget
system adopted by the State of Georgia under my direction
as Governor.
A zero-base budgeting system permits a detailed analysis
(7.) and justification of budget requests by an evaluation of
the importance of each operation performed.
An effective zero-base budgeting system will benefit the
Federal Government in several ways. It will
Focus the budget process on,a comprehensive analysis
of objectives and needs.
Combine Planning and budgeting into a single process.
Cause managers to evaluate in detail the cost-
effectiveness of their operations.
Expand management participation in planning and
budgeting at all levels of the Federal Government.
The Director of the Office of Management and Budget will
review the Federal budget process for the preparation,
analysis', and justification of budget estimates and will
revise those procedures to incorporate the appropriate
techniques of the zero-base budgeting system. He will
develop a plan for applying the zero-base budgeting con-
cept to preparation, analysis, and justifications of the
budget estimates of each department and agency of the
Executive Branch.
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a ask each of you to 'develop a zero-base system within
your agency in accordance with instructions to be issued
by the Office of -Management and Budget. The Fiscal
Year 1979 budget will be prepared using this system.
By working together under a zero-base budgeting system, we
can reduce costs and make the Federal Government more
efficient and effective.
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OMB BULLETIN NO. 77-8
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4 apil..L 17 / /
Copies sent to AO/DC1-& OGC Library
0/Compt has action - Suspense date: 25 Apr 77
(-& ss
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EXECUTIVE OFFICE OF THE PRESIDENT-
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503
BULLETIN NO. 77-8
April 4, 1977
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS !
SUBJECT: Resources for Program Evaluation in Fiscal Year
1977
1
? 1. Purpose. This Bulletin provides instructions for the
submission of information concerning the resources for
program evaluation provided for in fiscal year 1977.
2. Background. The Office of Management and Budget has
determined the need to collect and analyze information on
the level of Federal expenditures and staffing devoted to
program evaluation activities. The information requested by
this Bulletin is vital to an understanding of the magnitude
of evaluation resources and the ways in which these
resources contribute to the achievement of national goals,
agency missions, and program objectives. Moreover,
increasing concern about the adequacy of data on program
performance makes it necessary to assure that accurate
information can ? be provided to the Congress and the public
on the actual level of program evaluation expenditures.
3, Coverage. These-instructions apply to each executive
department and independent agency with more than 800
authorized full-time permanent employees.
4.' Definition. For purposes of. this Bulletin, program
evaluation means the formal assessment, through objective
measurements and systematic analyses, of the manner and
? extent to which Federal programs (or their components) have
achieved or are achieving their objectives, or are producing
other significant effects of either a desirable or
undesirable character, in order to assist future policy and
management decisions.
a.The following will be considered as Federal program
evaluation activities for the purpose of this Bulletin:
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????'.?
(1) Formal. studies.. surveys, and, data. analyses for
the purpose of determining the effectivenesd., efficiency, or
impact. of a national. or regional program.
(2) Systematic assessment of demonstration programs.
or projects which are expected to have-major implication' for
programs of national or. regional scope; except -that.
evaluation activities which, ere an intrinsic part of the
program operations or management should not be reported..
(31 Formal studies, surveys., and data analyses .-for
the purpose y)f assessing program managebent ',processes,
procedures, intervention techniques, workload distribution,
or productivity.
. (4) Assessment and development of ,program designS
to , assure that programs, once operational, can. be
sucCessfully evaluated.
(5) Design, development, and field testing of new?
program evaluation methodologies,
(6) Synthesis ?and further analysis of :results
obtained by several previous program evaluation effOrtd.
(7) Collection of. initial data . to help in
evaluation deSign and provide a baseline for subsequent. ?
evaluations.
b. The following will not be considered, aS program:
evaluation Activities for the purposes of this Bulletin.
(1) Design, development, and Operation of 'Oheral.
data. systems or management information systems. ?
(2) Continuing collection of routine data an
general purpose statistics. 1 .
(3) Analysis of existing or proposed policies where
no programs yet exist (even though authorized) for purposes
of :appraising the likely costs and effects of feasible:
alternatives. Although such analyses are often called
"evaluations," they are prospective in character; whereas
program evaluation is retrospective,. aimed at detetmining
what has actually occurred as the result of past program
actions.
.(4) Basic research and itudies'intended to ihcrease
or. foster general knowledge. development, but which are not
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expected to be used specifically and primarily in policy and
management decisions.
(5) Routine, day-to-day .monitoring of program
operations which is an intrinsic part of program
administration.
c. It is recognized that the present extensive
variation among Federal Agencies and programs will require
case-by-case judgments to determine the applicability of the
above ctiteria to agency "evaluation" activities.
S. Reporting Requirements. Departments and agencies should
submit a report in accordance with the attached instructions
and exhibit to OMB, attention: Evaluation and Program
? -Implementation Division by April 25, 1977. This is a one-
time report.
6. Rescission. This Bulletin is rescinded following
receipt of the April 25, 1977 report.
7. Inquiries. Inquiries and requests for assistance should
be directed to the 'Evaluation and Program Implementation
Division, Office of Management and Budget. (395-4726 or
395-56420
Bert Lance
Director,
Attachment
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,7p ATTACHMENT
Bulletin No. 77.-8
INSTRUCTIONS.
An original arid one copy of the report on program evaluation
resources will be prepared on letter size sheets (8x10-1/2)
and submitted in .the format of the attached exhibit, as
prescribed below. ?
Date - Enter the date of preparation
Contact - Enter the name and telephone number of an
individual who can respond to questions relative to
the information provided.
Part I. RESOURCES SCHEDULE:
Department/Agency/Bureau - Enter the reporting department or
independent agency. In the case of cabinet departments,
enter each bureau or comparable organizational unit for
which separate evaluation resources (funds and personnel)
can be identified, a consolidated line entry for any other
organizational units (if applicable), and a line .entry for
the total department or agency. At least one Spade should
be left between each line entry.
Staff years - Enter the estimated staff-years for full-time
permanent personnel who devote more than fifty percent of
their time to the program evaluation activities outlined in
paragraph 4a of this Bulletin. This includes full-time
government personnel engaged in monitoring or directing such
activities by contrabtors or grantees.
Salaries - Enter the 'estimated obligations for personnel
compensation related to the staff-year entry.
Personnel Benefits - Enter the estimated obligations for
personnel benefits associated with the salary figure.
Contracts/Grants - Enter the estimated obligations to be
incurred for evaluation contracts or grants, or, in the case
of multi-purpose agreements, the obligations for those
portions of the contracts or. grantS that are directly
related to the program evaluation activities described in
paragraph 4a of this Bulletin.
Other Expenses - Enter the total obligations estimated for
other administrative .expenses directly. related to the
performance, coMmissiOning, or oversightof the activities
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2
described in paragraph 4a of this, Bulletin. "Other
expenses" 'would include obligations for travel .and
transportation of ,persons, transportation of things, rent,
communications ,and utilities, printing .and reproduction,,
other services (such as ADP services), supplies ..and
materials,, and equipment. :Significant :obligations for any
fit these "other ekpenseS" ahould'be briefly identified in
the narrative.
Total - Enter the total estimated-FY 1977 obligations for
salaries,.personnel benefits, contracts/grants, and other
expenses. Note: All obligations are to be entered.in
thoUsefids Of '
Part II. NARRATIVE STATEMENT
A.brief explanatory statement should describe in general
terms the program evaluation activities being undertaken and
the objectives toward which they are directed. It should
highlight significant, increases or 'decreases in funding
levels from the current fiscal year to FY 1978 and major
policy..or.strategy changes .expected to occur. Emphasis
should be ,placed on the expected use of evaluation
information in the agency resource allocation and other
decision processes. In most instances, the narrative for
individual bureaus should,. be restricted to two or three
paragraphs and the departmental Or agency summary.' should not.
exceed ,two pages.
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e% ? fl
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ei50
EXHIBIT
Bulletin No. 77-8
Date:
Contact:
REPORT ON FY 1177 PROGRAM EVALUATION RESOURCES
(Dollars in Thousands)
Part I. RESOURCE SCHEDULE
Personnel Contracts Other
Staff Years Salaries Benefits Grants Expenses TOTAL
Department/Agency/Bureau- (FTP) ($) ($) ($) ($) ($)
Department of Government
(Report breakdown of major
bureau or other organiza-
tional unit for cabinet
departments only)
PART II. NARRATIVE STATEMENT
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OMB BULLETIN NO. 77-7
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e:41
Copies sent to AO/DCI and OGC Library
0/Compt responded to D/DCl/IC II March 77
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. - -
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
BULLETIN NO. 77-7
March 3, 1977
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT:
Limitation on hiring and revision of employment
ceilings
1. Purpose. This Bulletin provides guidance with respect
to the limitation on hiring ordered by the President in his
memorandum of March 1, 1977. This guidance is isslied
pending estaulishment of new employment ceilings for full-
time permanent and total Federal civilian employment for
fiscal years 1977 and 1978. It also provides instructions
for appeals in a limited number of situations where
exceptions to the hiring limitation may be granted.
2. Background. In a recent fireside talk to the American
people, President Carter reaffirmed his Administration's
commitment to reform and reorganize the Federal Government
and to bring its growth .under control. As part of this
effort, he promised to put a ceiling on the number of
Federal employees.
In his memorandum of March 1, the President stated that,
preparatory to establishing new employment ceilings, a
thorough evaluation of personnel requirements would be made
to, determine the lowest number needed to operate the
Government effectively. In the interim, the President has
ordered that a limitation on hiring be imposed so as to
maximize this Administration's flexibility in meeting
personnel requirements within the new ceilings. This
procedure accepts the consensus of the advice submitted. by
the Cabinet in response to the President's February 11
request for views on alternative employment control systems.
3. Limitation on hiring. Pursuant to the President's
memorandum, each agency will establish controls to limit the
number of appointments to full-time permanent positions to
not more than 75 percent of the number of its vacancies
occurring after February 28, 1977 (i.e., agency full-time
permanent hiring is restricted to on board strength as ? of
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Feoruary 26, 1977, less 25% of vacancies occurring
thereafter). ?
Except for the exemptions listed oelow, this limitation
applies to all new hires of Federal civilian personnel and
to transfers of personnel Petween Executive Branch agencies.
The limitation is effective immediately and will remain in
effect until new employment ceilings have been established
for fiscal years 1977 and 1978.
Where necessary, personnel reallocations . should be made
within agencies to meet needs of highest priority and to
assure that vital and basic services are not interrupted.
Contracting with firms and institutions outside the
Government will not be used to alleviate the effect of this
limitation. Nor will persons be hired on a part-time or
temporary basis as a substitute for full-time permanent
employees.
4. Standard exemptions. To preserve the continuity of
Government, the following exemptions to the limitation on
hiring are permitted:
a. at the discretion of the agency head, hiring
necessitated by emergency situations involving the safety of
human life and protection of property,
b. Hfilling of positions under programs that are
presently exempt from employment ceilings,
c. hiring for position's required to be filled under
specific provisions explicitly stated in law (This does not
include interpretations of laws, e.g., appropriation acts,
tnat do not contain requirements for speCific employment
levels.),
d. hiring in accordance with firm commitments made in
writing by agency personnel officers, prior to the effective
date of the limitation,
e. hiring by the U.S. Postal Service,
f. reassignments of personnel within an agency,
g- executive level appointments,
h. appointments to positiods of a. confidential or
policy-making character (established under Schedule "C" or
as "noncareer executives" by the Civil Service Commission).
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i. shifting of. employees from one agency to another
because of a transfer of functions resulting from
Presidential reorganization action, andi
j. hiring of employees who receive no compensation (if
otherwise permitted_idglaw).
5. Appeal of hiring limitation. In a very limited number
of cases, additional exemptions may be granted if the Office
of Management and Budget (OMB) determines that such action
is necessary to preserve the continuity of Government by
assuring that essential services are provided and that
fundamental needs are met. When an agency head believes
that circumstances in an agency warrant such an exception,
an appeal may be made in writing to the Director of the OMB
fully justifying the need for additional personnel and
explaining why intra-agency reallocationtis not feasible.
6. Revision of employment ceilings. As is noted above, in
his March V memorandum, President Carter stated that
existing employment ceilings for 1977 and 1978 will be re-
evaluated to determine the lowest number needed to operate
the Government efficiently and effectively. OMB will
undertake this re-evaluation jointly ;with the agencies.
Informal discussions between OMB and the agencies will be
initiated as soon at possible. It is anticipated that this
review will be completed and that agencies will be advised
of their new ceiling's by early April: At that time, the
Government-wide limitation on hiring will be withdrawn.
To ensure compliance with the new ceilings and to permit
some flexibility in seasonal hiring, agencies will develop
target levels for full-time permanent and total employment
as of June 30, 1977 and March 31, 1978. These targets will
be submitted to OMB no later than Friday,' April 22, 1977.
Once agreed upon, they will be treated as employment
ceilings against which agency efforts to'reach the new year-
end ceilings will be measured.
Any reductions in current employment levels will be achieved
through attrition. Thus, some agencies may have to continue
to curtail hiring once the Government-wide limitation has
been withdrawn in order to comply with new employment
ceilings. 1
7. Effective dates. The instructions in this Bulletin are
effective at once and will remain in effect until September
30, 1978. 1
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d. Inquiries.. Questions. regarding, the, instAuctiont km this 0
Bulletin will be addressed to. the- 0M93 repreaentativet in
charge of the -agencyte? bu4ge.r est' ates
ert Lane
Director;
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OMB Bulletin No. 77-6
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SEs
Distribution made as follows on 2/17/77:
1 - AO/DCI
1 - OGC Library
CIA has no action.
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c
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
BULLETIN NO. 77-6
SUBJECT: Monitoring Federal outlays
February 7, 1977
1. Purpose. This Bulletin temporarily revises instructions
contained in OMB Circular No. A-112 that relate to the
submission of reports on Federal outlays. These
instructions apply to each department or agency required to
prepare a monthly outlay plan. (See Attachment to OMB
Circular No. A-112.)
2. Reporting Requirements. The revision of the January
Budget during the next few weeks may significantly affect
outlay estimates in some agencies. As a result, the outlay
report normally due one week after transmittal of the budget
to Congress will not be required.. However, the April 1
update will be due one month earlier than usual -- on March
1, 1977.
The update report due on March l'should show a cumulative
total of actual outlay8 through January, 1977 and monthly
outlay estimates from February through September, 1977.
Agencies should explain significant differences between
these outlay amounts and the current year amounts contained
in the 1978 Budget as amended by the new Administration.
This change in reporting requirements pertains only to
Fiscal Year 1977.
Bert La
Director
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0MB Bd1ein No, 77i-5
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rk
Distribution made 2/9/77: a-4.--c?
?
STAT 1 OLC
1 AO/DCI
- 000 Library
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II
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EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
BULLETIN NO. 77-5
January 31, 1977
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Review of previous . agency legislative
' 'recommendations
1. Purpose. This Bulletin establishes procedures for the
.clearance (or reclearance) of draft bills and agency reports
on pending legislation which were submitted by agencies to
the Office of Management and Budget (OMB) prior to -January
.20, 1977,
2. Background. Under normal procedures set forth in Office
of Management and Budget Circular No. A-19, agencies
transmitted to OMB draft bills and reports on pending
legislation which were intended for submission to the 95th
Congress and were received in OMB prior to January 20, 1977.
Many of the draft bills and reports were cleared in
accordance with the policies of the previous Administration
and were srlt to the 95th Congress by the agencies concerned
before January 20, 1977. Others were still pending in OMB
on that date.
3.. Review of proposals. Applying the policies and
objectives of the present Administration, agencies are
requested to review the draft bills and reports which they
transmitted to OMB prior to January 20, 1977, and to
identify (a) the items which they wish to continue to
support, (b) those which they wish to continue to support
with revisions, and (c) those from which they wish to
withdraw support. This review should take into account the
response to the President's memorandum of January 22, 1977,
to the Secretaries! of Departments regarding submission of
their legislative programs, and the results of the revision
of the 1978 Budget in accordance with OMB Bulletin No. 77-4.
4. Preparation and submission of lists. Agencies should
prepare the fornwing lists of draft bills and reports and
submit them (an original and four copies) to the Assistant
Director for Legislative Reference, OMB, as promptly as
possible:
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a. A list of draft bills and reports which they wish to
continue to support unchanged. With respect to items which
were transmitted to the 95th Congress prior to January 20,
1977, this list will be treated as an agency request for
reclearance. With respect to items still pending in OMB on
that date, the list will identify those items on which the
agencies still wish to receive advice.
b. A list of draft bills and reports which they wish to
continue to support, but with changes. The items on this
list should be resubmitted to OMB for clearance in the usual
manner.
C. A list of draft bills and reports from which they
wish to withdraw support.
The agencies may send these lists to OMB in installments,
and so indicate, if that will serve to expendite clearance,
reclearance, or other appropriate action.
The agencies will be given advice which reflects the views
of the present Administration.
S?AIN
Bert Lance
Director '
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_OMB BULLETIN NO. 77-4
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