Government Wide Imperatives

Ganymede

Over the past 15 years, Congress has enacted legislation to change the way Federal agencies address common management problems and public opinion that Federal agencies should do their jobs more efficiently and effectively with fewer people and at lower costs. Using cost data to drive decision-making is essential in an era of stiff competition for limited resources. The legislative and policy framework requiring cost accountability include:

Government-Wide Imperatives

Budget Enforcement Act of 1990	Chief Financial Officers Act of 1990
Government Performance & Results Act (GPRA) of 1993	Federal Acquisition Streamlining Act of 1994 (Title V)
Paperwork Reduction Act of 1995	Federal Financial Management Improvement Act of 1996
Clinger-Cohen Act of 1996 (also known as ITMRA)	Circular A-11, Preparation and Submission of Budget Estimates
Government Paperwork Elimination Act of 1998	Circular A-127, Financial Management Systems
Circular A-123, Management Accountability and Control	OMB memorandum M-97-02, October 25, 1996, Funding Information Systems Investments
Circular A-130, Management of Federal Information Resources	Circular A-76, Competitive Analysis Performance of Commercial Activities
OMB memorandum M-00-07, February 28, 2000, Incorporating and Funding Security in Information Systems Investments

These new accountability laws and regulations, especially GPRA, are aimed at improving project performance. This legislative framework tasks government agencies like NASA to:

Focus on agency mission, strategic goals, performance, and outcomes;
Make strategic decisions about fiscal investments;
Get the biggest bang for the buck; and
Deliver results.

For Federal Executive Agencies, the policy imperatives require capital planning and business case analysis and are supported by the guidance and reporting requirements incorporated into the Federal budget process by the Office of Management and Budget (OMB) in Circulars A-11, A-130, and A-94.

THE PRESIDENTS MANAGEMENT AGENDA

The President's Management Agenda (PMA) identifies five mutually reinforcing Government-wide initiatives. The NASA cost estimating community will have a direct impact on three: Competitive Sourcing, Improved Financial Performance, and Budget and Performance Integration (see Exhibit 2-2 below).

Competitive Sourcing

Detailed estimates of full cost government performance to the taxpayer are needed for identifying the most efficient means of accomplishing a task. NASA will convert to Full Cost in GFY 2004 and all NASA cost estimates will have to be full cost.

The NASA cost estimating community now provides estimates in full cost. We have influence on this initiative by providing estimates to support studies, and conducting trade studies for efficiency.

Improved Financial Performance

Erroneous payments and accounting errors reduce confidence in Government systems. Changes will be made in the budget process to allow better measure of the real cost and performance of programs. When the Executive Branch Management Scorecard was updated in 2003 NASA dropped in status from yellow to red.

The NASA cost estimating community can have an impact on this initiative by providing timely and accurate cost estimates that serve as performance baselines and reconciling and updating the estimates frequently.

Budget and Performance Integration

Improvements will have little impact unless they are linked to better results. A budget comparison of procurement funds requested and identified need is not an accurate measure of performance results achieved with previous budgets.

Realistic and defensible cost estimates, integrated and incorporated, into the NASA IBPDs can have an impact on future requirements and demonstrating results.

Exhibit 2- 2: NASA and the PMA

The 2004 President's Budget for NASA expounds on a new exploration strategy, which calls for a timeframe paced by capabilities and affordability. The cost estimating community will play a central role in determining the latter. Furthermore, the President's Budget specifies every NASA project and project must & perform successfully against measures. By accurately baselining costs associated with the technical baseline, the cost estimating community can provide Project Managers (PMs) with more traceable and defensible estimating products, and an understanding the cost drivers and how to manage them.

THE FEDERAL BUDGET PROCESS

The planning and analysis conducted by individual project teams and agencies is the foundation for the formulation of the President's Budget (see Exhibit 2-3). The Federal budget process involves multiple stakeholders, each working towards the fulfillment of the vision for Government set forth by the Executive Office of the President. The Federal budget process has four phases, involving actions within and between the Executive and Legislative branches. The Federal budget process follows a complex schedule, which at the highest level, involves a flow of information among the Executive Branch departments, the White Houses OMB, and Congress.

Exhibit 2 -3: Creating the President's Budget

Exhibit 2- 3:Creating the President's Budget

The Federal budget process governs the operation of Federal programs and agencies. To remain in sync with the Federal budgeting process and comply with the requirements for receiving Federal/project funds, continuous, accurate, and forward-focused investment planning and analysis are required. As a current year budget is being executed, the next years budget must be formulated and planned (see Exhibit 2- 4). Development for a given years budget starts a year and a half before appropriations are enacted. When coupled with the Executive and Legislative requirements for capital planning, the pace can be difficult to maintain. However, by establishing a sound process for capital planning, including a structured approach to cost/benefit/risk analysis, the cycle of deadlines and reporting requirements can be met while the performance of the agency is improved.

	Preparing For FY X	Preparing for FY X+1	Preparing for FY X + 2
January X	OMB prepares FY X budget documentation and forwards it to Congress	Identify Initiatives for FY X + 1
February		Identify Alternative Solutions for FY + 1
March	Congress reviews the President’s FY X budget, develops its own budget, and approves spending and revenue bills.	Conduct and Document Capital Plan / Business Case (prepare cost estimates) for FY + 1
April
May
June		Internal Review of FY + 1 Budget Requests
July		Prepare IBPD
August		Prepare IBPD
September		FY X + 1 IBPD submitted to OMB
October	Execute FY X Budget	OMB Review of Budget Requests
November		OMB Passback
December		Appeals / Appeals Resolution
January X + 1		OMB Prepares the President’s Budget and forwards it to Congress	Identify Initiatives
February			Identify Alternative Solutions
March		Congress reviews the President’s FY X + 1 budget, develops its own budget and approves spending and revenue bills	Conduct & Document Capital Plan / Business Case Analysis (Prepare cost analysis)
April
May
June			Internal Review
July			Prepare FY X + 2 IBPD
August			Prepare FY X + 2 IBPD
September			FY X +2 IBPD Submitted to OMB
September			OMB Review of Budget Requests
October- September		Execute FY X + 1 Budget

Exhibit 2- 4: Continuous Flow of the Federal Budgeting Cycle