The executive budget is the budget for the

executive branch The executive branch is the part of government which executes or enforces the law. Function The scope of executive power varies greatly depending on the political context in which it emerges, and it can change over time in a given country. In ...

of the

United States government The Federal Government of the United States of America (U.S. federal government or U.S. government) is the Federation#Federal governments, national government of the United States. The U.S. federal government is composed of three distinct ...

. It was established as one of the reforms during the

Progressive Era The Progressive Era (1890s–1920s) was a period in the United States characterized by multiple social and political reform efforts. Reformers during this era, known as progressivism in the United States, Progressives, sought to address iss ...

and became a federal policy in 1921 under the Woodrow

Wilson Administration Woodrow Wilson served as the 28th president of the United States from March 4, 1913, to March 4, 1921. A History of the Democratic Party (United States), Democrat and former governor of New Jersey, Wilson took office after winning the 1912 Uni ...

. The process of creating the executive budget consists of three phases. The first stage is the development of the president's budget. In this stage, the president submits a comprehensive budget to the

United States Congress The United States Congress is the legislature, legislative branch of the federal government of the United States. It is a Bicameralism, bicameral legislature, including a Lower house, lower body, the United States House of Representatives, ...

that covers the full range of federal activities. Next, the budget proposal is edited and revised by Congress. Last, the budget is finalized and executed. It is then given a

budget bill A government budget is a projection of the government's revenues and expenditure for a particular period, often referred to as a financial or fiscal year, which may or may not correspond with the calendar year. Government revenues mostly include ...

from the legislature. The legislature composes the budget bill while an

executive agency An executive agency is a part of a government department that is treated as managerially and budgetarily separate, to carry out some part of the executive functions of the United Kingdom government, Scottish Government, Welsh Government or No ...

implements the bill by choosing which projects to take on within the limitations imposed.

History

One of the reforms of the Progressive Era in the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

was the executive budget system which had its first application for municipal government. The federal government conducted an important study of the executive budget system during the administration of President

William Howard Taft William Howard Taft (September 15, 1857March 8, 1930) served as the 27th president of the United States from 1909 to 1913 and the tenth chief justice of the United States from 1921 to 1930. He is the only person to have held both offices. ...

(See Sec. VI: The Taft Commission's Federal Budget Study, pp. 26–31). The executive budget system was adapted from the longstanding British parliamentary practice that forbade the

House of Commons The House of Commons is the name for the elected lower house of the Bicameralism, bicameral parliaments of the United Kingdom and Canada. In both of these countries, the Commons holds much more legislative power than the nominally upper house of ...

to increase requests for supply (appropriations) from the governing ministry (prime minister and cabinet) without the approval of the responsible government minister (cabinet member.)(See Sec. VI: Taft) It became federal policy in 1921 based on actions of the Wilson Administration that were enacted during the administration of

Warren G. Harding Warren Gamaliel Harding (November 2, 1865 – August 2, 1923) was the 29th president of the United States, serving from 1921 until his death in 1923. A member of the Republican Party (United States), Republican Party, he was one of the most ...

Process

The executive budget process consists of three main phases: development of the president's budget, interaction with

congress A congress is a formal meeting of the representatives of different countries, constituent states, organizations, trade unions, political parties, or other groups. The term originated in Late Middle English to denote an encounter (meeting of ...

, and execution of the budget.

Development of the president's budget

The legal framework established by the

Budget and Accounting Act of 1921 The Budget and Accounting Act of 1921 () was landmark legislation that established the framework for the modern federal budget. The act was approved by President Warren G. Harding to provide a national budget system and an independent audit of g ...

requires the president to annually submit a comprehensive budget to Congress that covers the full range of federal activities. Current law requires the president to submit his budget proposal no later than the first Monday in February. The creation of the budget usually begins approximately 10 months before the president submits his budget to

(about 18 months before the start of the fiscal year). During the early stages of the budget's formulation, federal agencies prepare their budget requests following their own procedures.

Interaction with congress

The president's budget does not have any legally binding effect, but rather initiates the congressional budget process and provides a statement of the budgetary goals of the president. After the president submits his budget proposal,

Office of Management and Budget The Office of Management and Budget (OMB) is the largest office within the Executive Office of the President of the United States (EOP). The office's most prominent function is to produce the president's budget, while it also examines agency pro ...

and other administration officials testify before the congressional committees. Individual federal agencies also justify and explain their specific budget requests at congressional hearings as budgetary legislation is formulated. Agencies submit extensive written justifications, usually focusing on the proposed increase or decrease in spending, to the responsible appropriations subcommittees of each chamber. The Office of Management and Budget ensures that agency budget justifications, testimony, and other submissions are consistent with the president's policies by requiring agencies to clear any material through The Office of Management and Budget before providing it to Congress. The president is required to submit a mid-session review by July 15 of each year. This budget update must reflect changes in economic conditions, any legislative actions taken by Congress, and other factors affecting the president's initial budget submission.

Execution of the budget

Once appropriation acts and any other budgetary legislation, such as revenue or reconciliation measures, become law, they are executed by the appropriate federal agencies. However, funds provided in statutes are not automatically available to agencies for obligation. Appropriated funds first must be apportioned by fiscal quarter or by activity as appropriate. The Office of Management and Budget is responsible for reviewing apportionment requests and making funds available to agencies.

Projects

The legislature proposes a budget bill for the executive agency that includes a cap on total spending and earmarked allocations to designated public projects. Each of these projects offers benefits to an interest group. In deciding which project to fund, the

is able to observe the productivity of each of the projects before their decision. Earmarks occur when the

executive Executive ( exe., exec., execu.) may refer to: Role or title * Executive, a senior management role in an organization ** Chief executive officer (CEO), one of the highest-ranking corporate officers (executives) or administrators ** Executive dir ...

serves a wide variety of interests, and a cap on spending occurs when the executive's constituency is not as broad as that of the powerful legislators. There is a separation of power between the legislative and executive branches of the government. The legislature composes the budget bill, which may or may not include a cap on total spending and earmarked allocations to designated projects, while an executive agency implements the bill by choosing which projects to take on within the limitations imposed by the law.

References

{{DEFAULTSORT:Executive Budget United States federal budgets