Previous: Formulation - Step 2: Guidance Next: Formulation - Step 4: Internal Budget Review and Decision

Internal budget process often refers to program and budget review process. Agency make further resource allocation among operating components by issuing agency fiscal guidance with considerations of historical budgeting documents, performance reports, and among other factors:

• 1. Budget limits and programmatic guidance from the Administration and OMB;
• 2. Recent legislation, including authorization and appropriation acts; availability and costs of institutional capabilities;
• 3. Outstanding issues that arose during the prior cycle of budget formulation; riation acts;
• 4. Proposed future investment strategies.

Agency also issues detail program and budget review guidance to guide operating components through internal budget process. The guidance contains detail formulation schedule, programmatic roles and funding levels, workforce planning guidance and targets, estimates of institutional capabilities and requirements.

Agency and its sub-components usually conduct two cycles of extensive reviews with the first review for five-year requirement from June to September, and the second review with primary focus on first year budget due to program and policy changes from October to January.

Operating components officially starts the process by receiving fiscal guidance from the agency, and actively participate throughout the whole process. The outcome of the process has a direct impact on its budget and operation; therefore, components have the most incentive to prepare and protect its budget. Senior management, finance management, and program offices of components often collaborate together during the process as an organization effort.

Operating components collect information, conduct extensive analysis, align budget request with the line of effort with legislative and policy guidance, and prepare data submission into systems, budget justification, exhibits, and presentations.

During the internal budget request process, the main steps been taken in place are:

• 1. Publish internal schedule and guidance; conduct kick-off meeting;
• 2. Send out data call to sub-components;
• 3. Consolidate collected data, and conduct analysis for cost projection, feasibility, affordability, consistence, and trade-off;
• 4. Coordinate with senior management and sub-components to determine funding strategy for budget submission, issue nomination, and unfunded requirements;
• 5. Make internal decision and prioritize programs and functions;
• 6. Convert data for submission to OMB MAX and agency systems formats;
• 7. Submit budget data, exhibit, justification, issue nomination into systems according to agency schedule.

Previous: Formulation - Step 2: Guidance Next: Formulation - Step 4: Internal Budget Review and Decision