Enactment - Step 15: Oversight Reports


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Oversight and reconciliation

Specific requests or directives to agencies are often included in the House and Senate reports accompanying appropriations bills. These directives may require agencies to provide reports on the progress of specified activities or to provide additional information on identified topics. Under normal circumstances, only requests included in both House and Senate reports or adopted by reference in the Conference Report will be subject to action. Also, in the event that particularly sensitive or critical items are requested in either the House or Senate reports, the Office of Budget will confer with bureaus to ensure that these reports that are treated appropriately.

DoD Example

Congress and DoD both require timely, consistent, and reliable information regarding the status of Major Defense Acquisition Programs (MDAPs) and Major Automated Information System (MAIS) programs in terms of cost, schedule, and technical performance. The three primary reports designed to provide this information are the Selected Acquisition Report (SAR), the Defense Acquisition Executive Summary (DAES) (released within DoD only), and the Unit Cost Report (UCR). Typically, once a program has been designated a SAR program, it is also required to comply with the DAES and UCR requirements.

Selected Acquisition Reports (SARs) are submitted to Congress for all ACAT I programs in accordance with 10 U.S.C. Section 2432. The SAR provides the status of total program cost, schedule, and performance along with program unit cost and unit cost breach information. This information is provided in concise form emphasizing new information and changes since the last report. Each SAR must include a full, life-cycle cost analysis for the reporting program, each of its evolutionary blocks, as available, and for its antecedent program, if applicable. Pre-Milestone B projects may submit SARs reporting only RDT&E costs.

A Nunn-McCurdy cost breach occurs when either of the following criteria are met:

  • The current estimate of Program Acquisition Unit Cost (PAUC) exceeds the PAUC objective in the currently approved Acquisition Program Baseline (APB) by 15% or exceeds the PAUC objective in the original APB by 30% or more, with both costs expressed in program base year dollars. PAUC is the system’s Program Acquisition Cost divided by the total number of fully configured development and production end items expected to be procured;
  • The current estimate of Average Procurement Unit Cost (APUC) exceeds the APUC objective in the currently approved Acquisition Program Baseline (APB) by 15% or exceeds the APUC objective in the original APB by 30% or more, with both costs expressed in program base year dollars. APUC is the system’s Procurement Cost divided by the total number of fully configured production end items expected to be procured;
  • "original approved APB" refers to that established at program initiation (Milestone B in most cases) • The statute defines the cost breaches above as 'Significant Cost Growth'.

The SAR submission requirement for a program for a given fiscal year may be waived if certain criteria are met: • The program has not entered the Engineering and Manufacturing Development phase (formerly known as the System Development and Demonstration phase) and there is no approved Acquisition Program Baseline, or • A reasonable cost estimate has not been established for the program, or • The system configuration for the program is not well defined. As described in DoD acquisition guidance, the USD (AT&L) may consider terminating a program's SAR submissions when 90% of expected production deliveries or 90% of planned acquisition expenditures have been made or when the program is no longer considered an ACAT I program.

Omnibus Budget Reconciliation Act

The Omnibus Budget Reconciliation Act of 1993 (or OBRA-93) was enacted by the 103rd United States Congress and signed into law by President Bill Clinton. It has also been unofficially referred to as the Deficit Reduction Act of 1993. Part XIII of the law is also called the Revenue Reconciliation Act of 1993.

The bill stemmed from a budget proposal made by Clinton in February 1993; he sought a mix of tax increases and spending reductions that would cut the deficit in half by 1997. Though every congressional Republican voted against the bill, it passed by narrow margins in both the House of Representatives and the Senate. The act increased the top federal income tax rate from 31% to 39.6%, increased the corporate income tax rate, raised fuel taxes, and raised various other taxes. The bill also included $255 billion in spending cuts over a five-year period. The effects of the bill helped the US federal government to experience in 1998 its first budget surplus since the 1960s.

  • Previously, the top individual tax rate of 31% applied to all income over $51,900. The Act created a new bracket of 36% for income above $115,000 and 39.6% for income above $250,000.
  • Previously, corporate income above $335,000 was taxed at 34%. The Act created new brackets of 35% for income from $10 million to $15 million, 38% for income from $15 million to $18.33 million, and 35% for income above $18.33 million.
  • The 2.9% Medicare tax had previously been capped to apply to the first $135,000 of income. The cap was removed.
  • Transportation fuels taxes were raised by 4.3 cents per gallon.
  • The portion of Social Security benefits subject to income taxes was raised from 50% to 85%.
  • The phaseout of the personal exemption and the limit on itemized deductions were permanently extended.
  • The AMT tax rate was increased from 24% to tiered rates of 26% and 28%.
  • Part IV Section 14131: Expansion of the Earned Income Tax Credit and added inflation adjustments.
  • $255 billion in spending cuts over a five-year period; much of the cuts affected Medicare or the military.

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