A bill to require agencies submit zero-based budgets.
S. 181 would require federal agencies to prepare and submit zero-based budgets on a recurring five-year horizon (for the next fiscal year plus the four following years). A zero-based budget starts from a clean slate, requiring agency managers to re-examine objectives, operations, and costs, consider alternative ways to accomplish programs, and rank programs by importance. Submissions would go to the Director of the Office of Management and Budget (OMB) and to the Senate and House Budget Committees. In addition to the zero-based budget, most agencies would also must submit recommendations identifying programs to cut or reduce, with at least a 2% reduction from the prior year’s discretionary spending; the Department of Defense and the National Nuclear Security Administration are exempt from this reduction requirement. The bill aims to promote programmatic justification and potential spending reductions through a rigorous, long-term budgeting process, but it also imposes substantial planning and analysis requirements on agencies.
Key Points
- 1Every sixth year, each agency must submit a zero-based budget for the next fiscal year and the following four fiscal years to OMB and the congressional budget committees.
- 2A zero-based budget is a structured analysis where managers reassess objectives, operations, and costs; consider alternatives; and rank programs by importance.
- 3In addition to the zero-based budget, most agencies must propose which programs should be cut or reduced, with a target of at least a 2% reduction in discretionary spending from the previous year (applies to all agencies except the Department of Defense and the National Nuclear Security Administration).
- 4The submission pathway is formal: to the Director of OMB and to the Senate Budget Committee and the House Budget Committee.
- 5The bill defines “agency” per 5 U.S.C. § 551 and sets the term “zero-based budget” to guide budgeting analysis and decision-making.