The Budgeting Process is Broken

by | Mar 23, 2021 | Business

Do the two things described below, and you can still come out on top.

You read that correctly but read on.

The method in which the budget moves from a request, through agency and OMB approval, to submission to Congress, to legislation, is slow and deliberate for lots of good reasons. However, the antiquated budget process assures we will always scramble to align funding to new capabilities for emerging technologies.

Efforts by government agencies to “act like a startup” or “act like a for-profit business” won’t change the reality of how funding is requested and approved. This part of the process will not change significantly in your working lifetime. Take that to the bank.

How does this reality impact your business?

We are in that strange place in the budgeting process where things are beginning to stack up, and agency leaders will make decisions with incomplete inputs.

We are in that strange place in the budgeting process where things are beginning to stack up, and agency leaders will make decisions with incomplete inputs. Want to learn more? Read here Click To Tweet

This severe flaw of budgeting regularly crops up. Problems are analyzed, and decisions are made for conditions two years in the future with poor knowledge of the future budget environment.  Some details to bring this directly into your workplace:

  1. Recall we are now executing the FY21 budget.
  2. The FY22 budget request is not yet public – it will become public roughly 60 days late this year.
  3. The FY22 budget request is the INPUT to the FY22 appropriations that will fund FY22
  4. The FY22 appropriations decisions will not be complete before the end of the year; we are already in a “slow” appropriations year. Translation – a CR is coming.
  5. The FY23 budget planning is well underway at the agency level today. Lacking clear planning guidance, decision-makers in program offices will make their best guesses on the future environment.

These conditions above do not reflect a new dynamic. It is the norm in federal budgeting. What this means in practical terms is that agency decision-makers are sorting options for a budgeting environment that is not yet clear.

The priorities of a new administration will cause changes to topline numbers. There will be “winners” and “losers.” Some will be obvious. For those relying solely on news clips, the cuts will be a surprise.

What can you do?

  1. Talk frankly with your customer about what you see for FY23. Although agency personnel cannot openly discuss FY22 while that request is not yet public, they can discuss FY23, and they will.  But you have to initiate the discussion. Show them that you have an understanding of what’s unfolding and help them see the same future.

1.a. Agency decision-making is an insular process. Over time, agencies believe they know best, and their decision-making apparatus gets the best answer.  Except it often doesn’t.  You can and must participate in the dialogue to the degree that you can.

  • If you have something ready to go NOW, test the water with your agency customer to reprogram FY21 funds toward you. For myriad reasons, the FY21 budget is not spending as planned. That means unobligated funds need to be obligated before they get swept up by someone else. Officials may move funds below 10 million dollars with their agency-level authority. If your solution is ready now or imminently, make the ask. You have nothing to lose.

These couple of options may look naïve in their simplicity. I contend it’s more naïve to wait and hope for the best. You have the ability and the capacity to guide your agency customer to spending options that can help you to help them.

Need help engaging with the federal government for a policy or funding your product? Schedule a call with Gene.

To get a copy of Pitching the Big Top: How to Master the 3-Ring Circus of Federal Sales, or information on federal sales, visit Capitol Integration.

0 Comments

Submit a Comment

Your email address will not be published. Required fields are marked *