The following commentary on Federal budget management is the first in a series of columns for Breaking Gov by James Windle called “Inside the Government Engine Room.”
After spending half of fiscal year 2011 under a series of short-term continuing resolutions, executive branch agencies have just a few more months before the next fiscal year begins. The outlook for a timely fiscal year 2012 budget does not look good.
Continuing resolutions, or CRs, are becoming the new normal. The President signing an annual appropriation before the new fiscal year begins on October 1 is becoming a relic of the past with CRs almost every year the past decade.
Congress uses CRs when an agreement on the budget cannot be reached by the end of the fiscal year. CRs can range in duration from a few days to the entire year.
The bite-size appropriations under short-term CRs are normally a simple pro-rata allocation of the prior fiscal year. For example, a 30-day CR allocates 30/365 of last year’s funding levels to executive branch agencies. Congress will write exceptions and guidance into CRs to keep disruptions to a minimum, but most agencies operate within the constraints of a pro-rata allocation.
As the executive branch has learned how to operate under a CR, an unintended consequence has been reducing the urgency for Congress to pass budgets on time.
The impact of CRs on agencies can be significant, particularly when there is a series of short-term CRs.
First, the bite-size allocations do not align with how agency programs are run because funding is not obligated evenly throughout the year. Some programs, for instance, may front-load obligating funds early in the fiscal year to secure low cost contracts; they cannot do so under a CR.
Second, most CRs do not permit new programs to start stalling new policy initiatives.
Finally, new hiring is often suspended since future funding is not known. The cumulative effect of these inefficiencies on programs can sometimes take months to correct.
Yet, despite the challenges of a CR, the executive branch has become quite adept at operating under them. This year was the ultimate test. Most of the executive branch operated under CRs into April. The White House warned of disruptions of public services but they never materialized. As the executive branch has learned how to operate under a CR, an unintended consequence has been reducing the urgency for Congress to pass budgets on time.
Put another way, the consequences of a CR for the executive branch are difficult for the public to discern. This has contributed to the emerging norm of the CR.
As mentioned, the outlook for the 2012 budget does not look good. The White House and Congress could negotiate a budget deal but there is not a lot of time. We may well end up in familiar territory. The House and Senate Committees on Appropriations, which like their executive branch counterparts have mastered the art of the CR, may end up drafting CRs as the new fiscal year begins.
Those frustrated by CRs should embrace the horror because CRs are the new normal.
The writer is a federal employee who has worked for executive branch agencies, the Executive Office of the President, and Congress. The views and opinions of the writer are his solely and are independent from the United States Government.