Transcript Navy Budget PPBE System

NAVY PPBE PROCESS
2010 Department of the Navy Human Resources Conference
April 28th, 2010
Captain Drew Flavell - Office of the Chief of the Navy Reserve
Department of the Navy
Today’s Discussion – The PPBE Process
Captain Drew Flavell - [email protected]
• PPBE is DoD’s resource allocation process
• Planning establishes strategic priorities and capabilities
required to achieve the strategy
• Programming applies resources to programs that provide
the capabilities required to achieve the strategic priorities
• Budgeting properly prices the programs, develops
justification and an execution plan
• Execution performs the approved plan
• Constrained resources drive the process
• Successively, within Navy & USMC, to DON, to OSD and to
OMB
• Must know requirements, and priorities among them
• Must achieve both program and TOA balance
Navy PPBE Process - HR Conference
Slide 2
Department of the Navy
2
The Federal Budget Over the Long Run
$ in B
6000
5000
4000
Net Interest
Welfare & Other Services
Medicare
3000
2000
Other Retirement
& Disability
Social Security
Medicaid
1000
Defense
Other Discretionary
0
1970
1980
1990
2000
2010
2020
2030
… DoD competes for $$
Navy PPBE Process - HR Conference
Slide 3
Department of the Navy
3
Combatant
Commanders
SECDEF
Robert
Gates
CJCS
VCJCS
ADM
Mullen
Gen
Cartwright
SOUTHCOM
PACOM
EUCOM
CENTCOM
GEN
Fraser
ADM
Keating
ADM
Stavridis
GEN
Petraeus
JFCOM
NORTHCOM
SOCOM
STRATCOM
GEN
Mattis
GEN
Renuart
ADM
Olson
GEN
Chilton
AFRICOM
AFRICOM
GEN
Navy PPBE Process
Ward - HR Conference Slide 4
TRANSCOM
GEN
McNabb
Department of the Navy
4
Navy Secretariat Organization
Secretary of the Navy
DoN Chief
Information
Officer
Undersecretary
of the Navy
Judge Advocate
General
of the Navy
Chief of
Information
Chief of
Legislative
Affairs
Auditor General
Naval
Inspector
General
Assistant for
Administration*
Director
Program
Appraisal
Director
Small & Disadv
Bus. Utilization
Asst Secretary
Of the Navy
(Research, Dev
& Acq)
Asst Secretary
Of the Navy
(Manpower &
Resv Affairs)
Chief of
Naval
Research
Navy PPBE Process - HR Conference
Asst Secretary
Of the Navy
(Fin Mgmt &
Comptroller)
Chief of
Naval
Operations
Slide 5
Asst Secretary
Of the Navy
(Installations &
Environment)
General
Counsel of the
Dept of
the Navy
Commandant
of the
Marine Corps
Department of the Navy
5
The DoN Secretariat
Secretary of the Navy
Honorable Ray Mabus
AG
R. Leach
OLA
RADM Miller
Under Secretary of the Navy
Honorable Robert Work
GC
SecNav
Pers Staff
IG
VADM Winns
RMDL
Moynihan
OPA
Jo. Decker
AAUSN
E. Roberson
DUSN for
Departmental
Plans, Policy,
Oversight,
and Integration
Bill Natter
DUSN for
Business Enterprise
Operations
and Transformation
Eric Fanning
JAG
VADM
MacDonald
Dir NCIS
Thomas Betro
GC
Anne Brennan
(Acting)
CHINFO
CNR
RADM Carr
DONCIO
Robert Carey
ASN RD&A
ASN-FM&C
ASN-I&E
Sean Stackley
John McNair
(Acting)
Roger Natsuhara
Navy PPBE Process - HR Conference
Slide 6
ASN-M&RA
Juan Garcia
(Acting)
Department of the Navy
6
CNO
OPNAV
Chief of Navy Reserve
VADM
Debbink
ADM
Roughead
MCPON
MCPON(SS/SW)
West
ADM
Greenert
QDR
NGEN
DNS
RADM
Goodwin
RADM
Burke
Chief of Chaplains
Dir, Test & Evaluation
RADM
Burt
RDML
Dunaway
VADM
Locklear
N4
N2/N6
N1
VADM
Ferguson
ADM
Donald
VCNO
Surgeon General
VADM
Robinson
Dir. Nuclear
Propulsion
VADM
Loose
VADM
Dorsett
Navy PPBE Process - HR Conference
Slide 7
N3/N5
VADM
Crowder
N8
VADM
McCullough
Department of the Navy
7
Joint Military Community (JMC)
– Reporting Relationships
President
of the
United States
Other
Defense
Agencies
Secretary
of
Defense
CJCS
JCS
Joint Staff
Delegated
Oversight
Responsibility
Functional and Geographic Combatant
Commanders
Military Departments/Services
Component
Commands
Navy PPBE Process - HR Conference
Slide 8
Department of the Navy
8
Linking to External Partners: OSD and JCS
DJS
J1
J2
J3
J5
J4
J6
J7
J8
Capability
(JCS)
DNS
N1
N2
N3
N5
N4
N6
N8
Specificity
(OPNAV)
OPA
ASN
(M&RA)
ASN
(RD&A)
ASN
(I&E)
ASN
(RD&A)
ASN
(RD&A)
DON
CIO
ASN
(FM&C)
DIR
ADMIN
&
MGMT
USD
(Pers &
Red)
USD (I)
USD (P)
USD
(AT&L)
ASD
(NII/CIO)
USD
(AT&L)
USD
(Comp/
CFO)
Stability
(SECNAV)
Affordability
(OSD)
CAPE
Navy PPBE Process - HR Conference
Slide 9
Department of the Navy
9
Navy Enterprise
INDIVIDUAL
WARFARE ENTERPRISES
PROVIDERS
& ENABLERS
NAE
SWE
USE
NNFE
Demand
Signals
NECC
CNO
REQUIREMENTS
MPT&E
AT&L
Installs
Health
Care
S&T
OUTPUT =
READINESS
AT
COST
PRODUCTIVITY DRIVERS:
– Priorities
– Behavioral Changes
– Single Processes/ Owners
Navy PPBE Process - HR Conference
Slide 10
USFF/
VCNO/
ASN (RDA)
N8/
ASN (FMB)
PROVIDERS
RESOURCES
– Common Metrics
– Integrated Capabilities
– Transparency of Information
Department of the Navy
10
PPBE Overlapping ‘Cycles’
POM10
FY10 PB
POM: Program Objective Memorandum
PB: President’s Budget
PR: Program Review
Programming
Budgeting
Execution
Planning
PR11
FY11 PB
Programming
Budgeting
Execution
• Perform
the plan
Planning
POM12
FY12 PB
• Develop the strategy
• Capability assessment
JAN 08
JAN 09
Programming
• Allocate resources
Budgeting
• Fiscal constraints • Detail & accuracy
• Program balance • Justification
• Develop the plan
JAN 10
JAN 11
Today
Navy PPBE Process - HR Conference
Slide 11
Department of the Navy
11
PPBE Products In a Notional POM Cycle *
POM
On-year
Planning
Programming
SecDef Guidance for
the Development of
the Force (GDF)
SecDef Joint
Programming
Guidance
Navy
Strategic
Plan (NSP)
CNO
Guidance
Navy
Capability
Plans
CNO
Investment
Strategy
Navy POM
USMC POM
Budgeting
Execution
DON Budget
Submits
Performance Plan
Budget
Funds Allocation
Estimate
Submission
SecDef
Supplemental
Program/Budget
Request
Decisions
President’s
Budget
Reprogramming
Request
DON POM
Appropriation
& Authorization
* PR (off-year) products discussed in Programming module
Navy PPBE Process - HR Conference
Slide 12
Department of the Navy
12
PPBE Timeframes
To Congress Spring 2010
POM12
(‘On Year’)
Every Year
06 07 08 09 10
11
Execution
12 13 14 15 16
17 18 19 20 21 22 23 24 25 26 27
Programming
Planning
•
•
•
•
Five Years Defense Plan (FYDP)
• Five-year period for resource allocation
Planning years
• Horizon for planning force structure & recapitalization
• Anticipate FYDP resource implications (e.g. advanced procurement)
Budget year
• Congress review, authorization and appropriation
Execution years
• 1-10 prior years, depending on type of appropriation
Navy PPBE Process - HR Conference
Slide 13
Department of the Navy
13
POM-12 Timeline
Navy PPBE Process - HR Conference
Slide 14
Department of the Navy
14
PPBE
Focus of the decision
Aircraft
Programming
Program view
Ships
Battlespace
Awareness
Base Support
Capabilities view
Manpower
Spare Parts
Planning
Fuel
Communications
RDTEN
Medical
Procurement
Intelligence
Property Repair
Space
Construction
Facilities
Depot Maintenance
Force
Application
Force
Support
Budgeting
Commodities/Appropriations view
Navy PPBE Process - HR Conference
Slide 15
Department of the Navy
15
Achieving Resource Balance
• The right level of
resources
Manpower
• The right program
prioritization
• The right amount of
risk
• The right program
tradeoffs
Integration
for
Resource
Balance
Readiness
Investment
…among and between MANPOWER, INVESTMENTS, and READINESS
Navy PPBE Process - HR Conference
Slide 16
Department of the Navy
16
PPBE - (Planning)
POM: Program Objective Memorandum
PB: President’s Budget
POM12
FY12 PB
Planning
• Develop the strategy
• Capability assessment
Programming
Budgeting
• Allocate resources
• Fiscal constraints • Detail & accuracy
• Program balance • Justification
• Develop the plan
Execution
• Perform
the plan
• Strategy development - N3/N5 (N51)
• Develop/refine military & business strategies
• Capabilities assessment - N8 (N81)
• Identify and balance the warfighting & support
capabilities needed to achieve the strategy
JAN 09
Navy PPBE Process - HR Conference
JAN 10
Slide 17
JAN 11
JAN 12
Department of the Navy
17
N81: Strategic Assessment
N81/QDR
Director Assessments
N810
Joint
Requirements
& Acquisition
N81F*
FORCEnet
N811
Studies,
Resources
& Costing
N812
Warfighting
Assessment
N81G*
Sea Shaping
N814
Warfighting
Support
Analysis
N81M*
Sea Basing
N81P*
Sea Shield
N816
Campaign
Analysis
N81T*
Sea Strike
* N-81 Pillar Leads
• Determination of warfare requirements, allocation of
resources, program planning, and study efforts
Navy PPBE Process - HR Conference
Slide 18
Department of the Navy
18
Maritime Strategy
• The Navy is setting out a series of strategic plans to guide
its way ahead in the 21st century.
• The Cooperative Strategy for 21st Century Seapower
(a.k.a. CS21) is one element of a larger four-part structure
that includes:
• Vision sets the ends. The Navy’s vision is Sea Power 21.
• Strategy is the ways and means to achieve the ends set forth
in the vision. The new Maritime Strategy will fill this role.
• Operations, as addressed in the Naval Operations
Concept, comprise the way resources are used and applied
by the warfighter
• Resources are finite & the Navy Strategic Plan will establish
CNO priorities and risk guidance for use by programmers in
the development of the budget submission
Navy PPBE Process - HR Conference
Slide 19
Department of the Navy
19
Navy Planning:
Assessing Capability
POM 12
PB 12
Planning
Programming
Budgeting
Execution
JAN 09
JAN 10
JAN 11
JAN 12
CNO Guidance
Navy Strategic Plan
Guidance for Development of the Force
Campaign Analysis Baseline
Front End Assessment (N81)
Integrated Capability Plan (N81)
Warfighting Capability Plan (N81)
Integrated Readiness Capability Assessment (N4)
Integrated Sponsor Capability Plans (N1 & N6)
Integrated Infrastructure Requirements (N4/CNI)
Integrated Program Assessment (N81 April)
CNO Investment Strategy (N802)
CNO Approved Budget to FMB (May)
Budget Estimate Submission to OSD (July)
JUL 09
SEP
Navy PPBE Process - HR Conference
Slide 20
NOV
JAN 10
MAR
Department of the Navy
20
PPBE Programming
POM: Program Objectives Memorandum
PB: President’s Budget
PR: Program Review
Planning
• Develop the strategy
• Capability assessment
Programming
Budgeting
• Allocate resources
• Fiscal constraints • Detail & accuracy
• Program balance • Justification
• Develop the plan
Execution
• Perform
the plan
• Program development
• Assign resources to programs, to meet capabilities
• Apply resource constraints to achieve fiscal balance
• Program review (not PR)
• Balance across programs to optimize effectiveness
JAN
Navy PPBE Process - HR Conference
JAN
Slide 21
JAN
JAN
Department of the Navy
21
Resource Programming
• Allocation of future resources
• ‘buy’ programs that provide capabilities from Planning Phase
• Allocate in each year over the FYDP
• Constraints are imposed
•
•
•
•
‘Topline’ TOA limits
Many participants have competing requirements
Guidance from ‘higher authority’ (Navy, DOD, OMB, Congress)
Fact-of-life (e.g. basing), ability to execute
• Iterative processes, within Navy and within DOD, to
achieve program balance
• Program development and recommendation
• Program review (not to be confused with PR), adjustment and
decision
• Approved ‘program’ is starting point for budget
Navy PPBE Process - HR Conference
Slide 22
Department of the Navy
22
‘Resource’ in Programming
• The commodity that is allocated in programming
• In each FY over the FYDP
• Commodities can be freely exchanged within a FY
• Each has an established/approved ‘price’
• Three types of resources
• Quantities: Equipment procured during a FY
• End strength: Manpower planned at the end of a FY
• $$$: For all other programs
Total F/A-18
Resources
(for one FY)
Qty
3
$/each
$75,000K
Subtotal $225,000K
Navy PPBE Process - HR Conference
Endstrength
25
$/each
$120K
Subtotal $3,000K
Slide 23
Flt Hours
3,000
$/hour
$5,000
Subtotal $15,000K
$243,000K
Department of the Navy
23
Resource Integration (N80)
Integration
for
Resource
Balance
Dir, Programming
N80
Program Development
• Support balanced investment
(warfighting) requirements
Dep Director
• Monitor programs throughout
Head, Program
Planning and
Development
Readiness
Head, POM
Strategy, R3B
Sea Shield
POM Strategy
MPT&E
Sea Strike
FORCEnet
Sea
Shaping
Sea
Basing
Database
Mgmt
N80 “Pillar Leads”
Navy PPBE Process - HR Conference
Slide 24
• R3B Secretariat/Issue Coord
• CNO Investment Strategy
• Develop POM guidance, controls, timelines
• Emergent OSD, Joint, Fleet, USMC
Requirements
Department of the Navy
24
Manpower, Personnel, Training &
Education (N1)
Manpower
N1
Manpower, Personnel, Education & Training
Chief of Naval Personnel
N10
MPN Financial
Management
N12
Total Force Programming
Manpower & Information
Resources Management
N11
Civilian Community Management
N13
Military Personnel
Plans & Policy
N16
Chief Information Officer
MPT&E Information
Management
• Provide the right person in the right place at the right time
• Strive to satisfy personal goals and improve their quality of life
• Provide meaningful and rewarding career opportunities, promote and
retain the best
• Ensure fair and equitable treatment of all hands, by all hands, at all times
Navy PPBE Process - HR Conference
Slide 25
Department of the Navy
25
Readiness & Logistics (N4)
Readiness
N4
Fleet Readiness & Logistics
N41
Supply, Ordnance &
Logistics Operations
N42
Strategic Mobility &
Combat Logistics
N40
Logistics, Planning & Innovation
N43
Fleet Readiness
N45
Environmental Protection
& Readiness
N46
Ashore Readiness
• Provide relevant policy, resources, structures and mechanisms to meet
leadership defined readiness requirements of Navy operating forces and
their associated shore installations
• Enable a responsive, adaptive and efficient logistics support structure
that facilitates that readiness and supports the integration of Naval
forces into the joint force
Navy PPBE Process - HR Conference
Slide 26
Department of the Navy
26
Investments (N8F, N8(x))
Investment
Dir, Warfare Integration
N8F
Dep Director
Warfare
Integration
(N6F/N83)
Oceanographer
/Navigator of
the Navy
(N84)
Expeditionary
Warfare
(N85)
Surface
Warfare
(N86)
Submarine
Warfare
(N87)
Air Warfare
(N88)
Special
Programs
(N89)
• CNO’s principal advisor for warfare capability requirements
and integration
• Conduct warfighting analysis and programming to support PPBE
• Fleet’s OPNAV focal point for warfighting & joint requirements
Navy PPBE Process - HR Conference
Slide 27
Department of the Navy
27
Resource Sponsor
• Responsible for an identifiable group of resources
constituting certain warfare or supporting tasks
• Interrelated programs or parts of programs in several mission
areas
• Ensuring an effective and balanced program within assigned
fiscal controls
• Assisting during internal-Navy budget reviews in order to maintain
a balanced program
CNO
SECNAV:
AAUSN
Manpower
DNS
Readiness
Investment
N8(0)
CNIC
SYSCOMS
COMUSFFC
Other
Ech 2
Wears the “hat”
Process Coordinator
Navy PPBE Process - HR Conference
Slide 28
Department of the Navy
28
Resource Sponsor Actions
Programmatic options to “fix” disconnects
• Fund
Requires resources
• Restructure
Adjust program’s required results
• Reengineer
Revise processes to use fewer resources
There is a non programmatic option…accept the risk
Most often, accepting risk involves
delaying funding or assuming the
problem can be fixed in execution
Navy PPBE Process - HR Conference
Slide 29
Department of the Navy
29
Programming Process
Most Dear
Funded
New Requirements
RS
Unfundeds
Unfundeds
MostDear
Dear
Most
Most
Dear
FY12 Most Dear
FY09
FY09
New Funded FY12/17
FY09
NewFunded
Funded
New
Content New
New
Funded
Funded
Content
Content
Content
Least Dear Content
Most
Dear
Most Dear
FY12/17
FY06/07
Existing
Funded
Funded
Content
Content
Least Dear
Dear
Least
Least
Dear
Least
Dear
Least
Dear
Least
Dear
Unfundeds (Risk)
Offsets
• Adjust program content by moving resources from lower priority content to content of
higher priority
• In each successive activity, the services adjust the content of the FYDP based on
new or changing requirements
• Low priority programs gave way to fund higher priority programs
Navy PPBE Process - HR Conference
Slide 30
Department of the Navy
30
Sources of Offsets
• In general, there are four sources of offsets
• Reducing or delaying investments
• Cutting RDT&E funds, delaying modernization, stretching
procurement
• Reducing/accepting risk in readiness
• Cutting operational and formal skills training budgets, eliminating
forward basing
• Divesting forces
• Planes, ships, readiness, people
• Reducing infrastructure
• Base support, tech refresh, ranges and minor facilities
•
Some will argue for a fifth source: efficiencies
Navy PPBE Process - HR Conference
Slide 31
Department of the Navy
31
Programming - Fiscal Guidance
DoD
DoN
Air Force
$143B
USN
N4
$27B
USN
$120B
DoN
$148B
Army
$139B
N6
$5B
N1
$30B
N8F
$54B
Other
$81B
USMC
$25B
SRB
$2B
Other
$4B
• OSD issues Service TOA controls across the FYDP
• SECNAV approves DoN ‘Blue – Green’ split
• N8 distributes Resource Sponsor shares for SPP development
**Numbers may not add due to rounding to nearest $Billion.
Navy PPBE Process - HR Conference
Slide 32
Department of the Navy
32
Sponsor Program Proposal
Many Inputs, Two Outputs
Congress
Actions
Fiscal
Guidance
N80
POM/PR
WARNORD
PLANORD
FRAGORD(s)
Allocate across FYDP
CNO
‘Path
Ahead’
CCIPs
• Endstrength
• Investment
• Readiness, support,
etc. TOA
Make recommendations
Fact of Life
Unfundeds
• Database issue details
• Briefing to BOD
N8
Program
Guidance
Navy PPBE Process - HR Conference
Each Sponsor has an
internal process to:
Explore options
• Capabilities balance
• Program balance
• Resource balance
N81
Invest
Strategy
COCOM
IPLs
FY09 FY11
Slide 33
1
.
.
.
.
p
Priority
1
.
.
.
.
w
….
FY15
Core Issues
(Funded)
FY09 FY11
….
FY15
Above Core Issues
(Unfunded)
SPP
Briefing
Department of the Navy
33
POM/PR ‘Endgame’
Iterative, Fast-Paced
‘End
Game’
Resource Sponsors submit SPPs
Integrate SPPs (N8)
Pre T-POM Assessment (N8 with USMC)
Revise SPPs and build T-POM (N8)
CNO approve Navy POM
NOV
JAN
MAR
MAY
JUL
AUG
• N8-led ‘process’ to balance the Navy POM
• N80 compiles SPPs to create the Tentative-POM (T-POM)
• N81 assesses degree the T-POM achieves the Investment Strategy
• N80 assesses for resource and program balance across the FYDP, and
compliance with other guidance
• R3B/BoD reviews the T-POM
• Identify guidance ‘busts’, recommend options to CNO
• CNO involved early and often
• CNO Guidance provides adjusted guidance to optimize T-POM balance
Navy PPBE Process - HR Conference
Slide 34
Department of the Navy
34
Program Review
Concurrent with Budget
PR12
FY12 PB
Planning
Programming
Budgeting
Execution
JAN 09
JAN 10
JAN 11
JAN 12
POM to BSOs
POM to OSD
OSD/CAPE POM Issues
DoD Senior Level Review (SLRG, DAWG)
DepSecDef Resource Management Decisions
BSO Budget submits
FMB review and markup
SecNav budget decisions
BSOs & FMB develop BES
Budget Estimate Submission to OSD/C
OSD/C review and Resource Mgmt Decisions
Major Budget Issues
DepSecDef decisions
Develop & submit President’s Budget (Feb 1)
MAY
Navy PPBE Process - HR Conference
JUL
Slide 35
SEP
NOV
JAN
Department of the Navy
35
OSD Program Review Process
OSD Issue Team
- Analysis
- Programmatics
- Alternatives
- Courses of Action
Briefing and/or Paper
RMD
SLRG/DAWG
SLRG/DAWG
OSD
Issue Team
(w/ DoN
member(s))
Pre SLRG or
DAWG
(SECDEF)
SECNAV/CNO
(DEPSECDEF)
attends
briefings
3-Star
Out-of-Court
Navy PPBE Process - HR Conference
CAPE/ 3-Star
Meeting
N8 Attends
Issue Papers or
Briefing
CAPE/ N8/N80
negotiate issues
Slide 36
Courses
of
Action
Courses
of
Action
CAPE
Comptroller
VCJCS
SECDEF
Courses
of
Action
Department of the Navy
36
PPBE: Budgeting
Planning
Programming
POM10
FY10 PB
Budgeting
Execution
• Program balance • Detail & accuracy
• Fiscal constraints
• Performing as appropriated
• Prior year execution
• Justification and defense
PR11
FY11PB
Planning
Programming
Budgeting
Execution
POM12
FY12 PB
Planning
POM:
PR:
PB:
Program Objectives Memorandum
Program Review
President’s Budget
JAN 08
Navy PPBE Process - HR Conference
JAN 09
Slide 37
Programming
Budgeting
JAN10
JAN11
Department of the Navy
37
Applying Fiscal Granularity
Asst Secretary of the Navy
(Financial Mgmt & Comptroller)
Dir, Fiscal Mgmt
FMB/N82
FMBB/N82B: Asso. Director
Operations
Division
FMB1/N821
Investment &
Development
Division
FMB2/N822
Navy PPBE Process - HR Conference
Slide 38
Program/
Budget Coord
Division
FMB3/N823
FMBE
Asst for
Appropriation Matters
Civ Resources &
Business Affairs
Division
FMB4/N824
Budget Policy
& Procedures
Division
FMB5/N825
Department of the Navy
38
Appropriation Sponsor
• The senior executive in the DON responsible for
• Supervisory control and broad decision-making authority over a designated
appropriation
• Assisting in solving funding deficiencies during budget formulation
• Representing Navy before Congress
-
preparing and reviewing witness statements
responding to questions and briefing Congressional members or staff
reviewing Committee reports and for preparing consolidated appeals
• Recommending the reprogramming of funds within the appropriation during
budget execution
CNO
DNS
Manpower
Readiness
Wears the “hat”
Investment
FMB/N82
CNIC
SYSCOMS COMUSFFC
Other
Ech 2
Process Coordinator
Navy PPBE Process - HR Conference
Slide 39
Department of the Navy
39
Budget Submitting Office
• A DON office responsible for
• Preparation, compilation, and submission of budget estimates and
supporting materials
• Delivering prescribed exhibits and ensuring that subordinate offices submit
materials on time
• Ensuring submissions are consistent with DON Review and OSD/OMB
budget decisions
• During budget execution, ensuring budget plans are accomplished within
available funding
CNO
DNS
Manpower
Readiness
Investment
FMB
CNIC
SYSCOMS
COMUSFFC
Other
Ech 2
Wears the “hat”
Process Coordinator
Navy PPBE Process - HR Conference
Slide 40
Department of the Navy
40
How to Build a Budget
1. Budget guidance is issued
Navy BSO
2. Current/prior fiscal year execution is reviewed
3. Disconnects between guidance and execution are
identified
4. Exhibits are prepared and submitted (BSO)
5. Exhibits are reviewed and analyzed; adjustments
are recommended (FMB) via Issue Papers
6. Appeals are submitted (BSO)
7. Meetings are held to resolve outstanding issues
Navy FMB
OSD (C)
OMB
Congress
8. Approved budget is submitted to next level
Note budgeting is a bottom-up exercise. Planning and programming are top-down.
And, this process repeats FOUR times!
Navy PPBE Process - HR Conference
Slide 41
Department of the Navy
41
Concurrent Program & Budget Activities
PR to OSD (ref: 14 Aug 2009)
OSD/CAPE PR Issues (Aug 14 – Sep 14)
DoD Senior Level Review Group Review (Sep-Oct)
DepSecDef Resource Management Decisions (Sep – Dec)
BSO Budget submits (6 Jul)
FMB review and markup (2 Jul – 12 Aug)
SecNav budget decisions (12 Aug)
Budget Estimate Submission to OSD/C (14 Aug)
OSD/C review (Aug 14 – Sep 14)
DepSecDef decisions – RMDs (Sep – Dec)
Develop & submit President’s Budget (Dec 4)
President’s Budget Released (Feb 1)
APR 10
Navy PPBE Process - HR Conference
JUN
Slide 42
AUG
NOV
JAN 11
Department of the Navy
42
What’s an “Exhibit”?
• Additional detail beyond database numbers
• Walks from year to year with explanation
• Examples:
Appropriation
Exhibit Title
Broken Down To:
MILCON
C-1
BA, State, Base, Project
MILPERS
M-1
Budget Activity and project
O&M
OP-5
BA and AG/SAG
Procurement
P-5
BA and Budget Line Item (BLI)
RDT&E
R-2
BA and Program Element (PE)
• Three key exhibit formats:
• Horizontal” (fiscal years from left to right)
• “Vertical” (like a checkbook register)
• “ Hybrid” (fiscal data at top; written justification below)
Navy PPBE Process - HR Conference
Slide 43
Department of the Navy
43
What Do Budgets Look Like?
Let’s look at part of the DoN FY11 O&M Budget (758 pages total)
http://www.finance.hq.navy.mil/fmb/11pres/BOOKS.htm
Navy PPBE Process - HR Conference
Slide 44
Department of the Navy
44
Reading Budget Exhibits:
Price Growth vs Program Growth
If quantity stays the
same but cost
changes, that’s
PRICE growth.
Examples:
- Inflation
- Foreign currency
- Utility rates
- Fuel fluctuations
- Pay raises
If quantity changes,
that’s PROGRAM
growth.
A “horizontal” exhibit example (OP-32) – see handout
Navy PPBE Process - HR Conference
Slide 45
Department of the Navy
45
Reading Budget Exhibits:
Price Growth vs Program Growth
If quantity stays the
same but cost
changes, that’s
PRICE growth.
Examples:
- Inflation
- Foreign currency
- Utility rates
- Fuel fluctuations
- Pay raises
If quantity changes,
that’s PROGRAM
growth.
A “horizontal” exhibit example (OP-32) – see handout
Navy PPBE Process - HR Conference
Slide 46
Department of the Navy
46
Leading Players in the Process
Congressional Oversight Committees
House of Representatives
• Budget Committee (HBC) -- Budget Resolution
• Armed Services (HASC) -- Authorization
• Appropriations Committee (HAC) -- Appropriations
Senate
• Budget Committee (SBC) -- Budget Resolution
• Armed Services (SASC) -- Authorization
• Appropriations Committee (SAC) -- Appropriations
Navy PPBE Process - HR Conference
Slide 48
Department of the Navy
48
Congressional Budget Timeline
4
MAR
FEB
APR
MAY
PB
To Hill
House
Concurrent
Budget
Resolution
Senate
JUN 30 JUL
AUG
SEP
1
OCT
NOV
4
FY
Begins
House CompletionTarget
for FY09 Approps Bills
Markup
HBC
Hearings
Floor
Floor
CONF
SBC
Hearings
Floor
Floor
Markup
House
Defense
Authorization
Bill
Floor
HASC Hearings
Senate
House
Defense / Milcon
Appropriation
Bills
Senate
Floor
Public
Law
CONF
SASC Hearings
HAC Hearings
Markup
Floor
Floor
Floor
Markup Floor
CONF
SAC Hearings
Navy PPBE Process - HR Conference
Note: All timeframes projected/approximate
Markup
Slide 49
Markup
Public
Law
Floor
Floor
Department of the Navy 49
302(b) Allocations (and Appropriations)
•
•
•
•
•
•
•
•
•
•
•
•
Agriculture
Commerce, Justice, Science
Defense
Energy and Water
Financial Services
Homeland Security
Interior
Labor, HHS
Legislative Branch
Military Construction / VA
State / Foreign Operations
Transportation / HUD
Navy PPBE Process - HR Conference
Slide 50
Department of the Navy
50
Authorization Process
(Armed Services Committees)
• Defines the scope and content of programs and
authorizes their appropriation level
• Provides statutory authority to establish or
maintain a government program or agency
• Legislative vehicle for Congress to address
policy issues and concerns and exert its
oversight role
• Must have Authorization for:
•
•
•
•
Pay Raise
End Strength
New Start Programs
MILCON projects
Navy PPBE Process - HR Conference
Slide 51
Department of the Navy
51
Appropriation Process
(Appropriation Committees)
• Provides authority to DoD to obligate funds for
defense programs
• Usually approved at the “account” level, e.g. Combat
Training Ranges
• Obligation authority usually for a specified period
• “Policy” language not permitted
• Bulk of defense funding provided by three
appropriations acts
• DoD Appropriations
• Military Construction Appropriations
• Energy and Water Appropriations
Navy PPBE Process - HR Conference
Slide 52
Department of the Navy
52
Types of Appropriations Acts
• Regular Appropriations Acts
• 12 individual bills
• Provides budget/obligation authority for the next FY
• Continuing Resolutions (CR/CRA)
• Enacted when 1 or more of the 12 regular bills have not
become law by Oct 1
• Provides stop-gap funding at level usually no higher than
lowest of levels approved by HAC, SAC or prior fiscal year
• Restricts authority to current programs only - no new starts
• Supplemental Appropriations Acts
• Provides funds for emergency or unforeseen expenses for
current fiscal year
Navy PPBE Process - HR Conference
Slide 53
Department of the Navy
53
Coordination is Key
OLA
• Liaison for authorization matters
FMBE
• Liaison for appropriation matters
DoNPIC
• Department of Navy Program Information Center
REMEMBER:
• Whenever you deal with Congress or Congressional
Staff, ALWAYS adhere to the coordinated DoN, DoD,
and Administration position
Navy PPBE Process - HR Conference
Slide 54
Department of the Navy
54
FY10 Budget Execution
POM10
FY10 PB
Planning
Programming
Budgeting
Execution
JAN 07
JAN 08
JAN 09
JAN 10
Auth/
Appn
Laws
CRA
Funds
Apportioned
BSO
Execution
N82 Midyear Review
Supplemental/Omnibus Reprogramming
N82 Year-end Reapportionment
SEP 09
DEC 09
Navy PPBE Process - HR Conference
Slide 55
MAR 10
JUN 10
SEP 10
Department of the Navy
55
Three (and ½) Execution Phases:
Summary
1
Obligation:
Legal
encumbrance;
Specified amount
for purpose or
product when an
order is placed
1½
2
Expenditure:
Authorization for
funds from
Treasury
resulting from
presentation of a
voucher or claim
3
Outlay:
Cash paid
by the
Treasury
Deobligation: reversal of an obligation
due to contract mod, order cancellation,
completion of task. etc
Navy PPBE Process - HR Conference
Slide 56
Department of the Navy
56
Three Execution Timeframes
Phase
Current
(1 yr +)
Expired
(5 yr +)
Cancelled
Oblig.
1
De-Obl.
Expend
2
Outlay
3
   
X   
X
Navy PPBE Process - HR Conference
Slide 57
X
X
X
Department of the Navy
57
Execution Activities:
External Reprogramming
APN
O&MN
• Moving funds from one appropriation to another
• Cannot be done without approval of Congress (all 4 committees)
• Annual “Omnibus” reprogramming falls into this category
• Also some limits prohibiting reprogramming within an appropriation
• Difficult way to increase program value
Navy PPBE Process - HR Conference
Slide 58
Department of the Navy
58
Congressional Reprogramming Guidelines
Must ask Congress to…
• Move funds between any
appropriations
• Increase any “major procurement”
quantity
• Affect a Congress Interest Program
• Shift > $10M MILPERS
• Shift > $15M O&M
• Shift > $20M or 20% Procurement
• Shift > $10M or 20% RDT&E
• Begin any new start > $20M
• Terminate procurement ($20M) or
RDT&E ($10M)
Must notify Congress to…
•
•
•
•
•
Begin a new start
Shift < $20M Procurement
Shift < $10M RDT&E
Execute safety mod < $20M
Terminate RDT&E < $10M
Via Prior-Approval Reprogramming Request
(a.k.a. “Above Threshold Reprogramming”)
www.dod.mil/comptroller/execution/Final_Budget_Execution.pdf
All requests are submitted and approved by USD(C) before transmittal to Congress
Navy PPBE Process - HR Conference
Slide 59
Department of the Navy
59
Funds Usage Expectations:
Stay Within The Law
Public Law says…
• 31 USC 1301: Appropriated funds may be used only for
the purposes for which the appropriation is made
• 31 USC 1517: No officer or employee may authorize an
obligation in excess of the amount available in an
appropriation or subdivision thereof
In any given year you cannot exceed either the
authorized Outlay amount or Total Obligation
Authority
“fiduciary responsibility”
Navy PPBE Process - HR Conference
Slide 60
Department of the Navy
60
Other Execution Activities: Mid-Year Review
• Budget performance is monitored against plans
developed during the budget formulation process
• Program performance
• Obligation and outlay phasing
• O&M accounts required to perform an execution review
and submit the results for approval
• Realignment of funds made in accordance with urgent
“unfunded” requirements
• Remaining reserve may be released to help finance
approved unfunded requirements
Navy PPBE Process - HR Conference
Slide 61
Department of the Navy
61
Execution Activities: Fiscal Year Closeout
• Annual appropriations must be fully obligated by 30
September each year
• 4th quarter intense effort to pull back unobligated funds
and reissue to other unfunded requirements
• Funds not obligated cannot be restored and any
underexecution will cause reductions in the following
fiscal year level of available funding
• Obligation adjustment can be made during the 5 year
expired status
• After that period, adjustments must be financed with an
appropriation currently available for the same purpose
Navy PPBE Process - HR Conference
Slide 62
Department of the Navy
62
Joint Process - Combat Commands
– Reporting Relationships
President of the
United States
Secretary
of
Defense
CJCS
JCS
Joint Staff
Delegated
Oversight
Responsibility
Geographic Combatant
Commanders
USAFRICOM
USJFCOM
USCENTCOM
USSOCOM
Navy PPBE Process - HR Conference
USEUCOM
USSTRATCOM
Slide 63
USPACOM
USTRANSCOM
USSOUTHCOM
USNORTHCOM
Functional Combatant
Commanders
Department of the Navy
63
Different Responsibilities:
Warfighters vs Resource Providers
Warfighters
Resource Providers
CJCS, JCS, JS, Combatant
Commanders (COCOMs)
• Services/Military Departments
Function/Purpose:
• Advise President and
SecDef on strategic direction
of armed forces
• Fight and win nation’s wars
• Advocate for warfighting
(program and resource)
requirements to enable that
outcome
• Submit budget proposals for
combatant command
activities
• Function/Purpose:
• Organize, train, and equip
• Prepare and submit budgets
• Prepare and provide forces to
employ in time of war
• Serve as “executive agent” for
combatant commands
Navy PPBE Process - HR Conference
Slide 64
Department of the Navy
64
Balancing Competing Objectives:
Combatant Commanders and Services
Combatant
Command Priority
Near term warfighting
requirements
Service Priorities
Near term readiness
Longer-term
modernization
• Creates tension in the resource allocation process
• Can be healthy
• promotes balance between near-term/unconstrained
COCOM focus and long-term/constrained Service focus
Navy PPBE Process - HR Conference
Slide 65
Department of the Navy
65
USMC - HQMC Organization
Commandant, USMC
Counsel for the Commndant
Chaplain of the Marine Corps
Sergeant Major of the Marine Corps
Marine Corps Systems Command
ACMC
Marine Corps National Capital Region
Command
Marine Corps Combat Development
Command
Director, Safety Division
Marine Corps Recruiting Command
DMCS
Marine Barracks Washington, DC
Special Projects Directorate
Dir,
Public Affairs
Staff Judge
Advocate
Legislative
Assistant
Inspector
General
Marine Corps Logistics Command
DC, Manpower
& Reserve Affairs
DC, Plans,
Policies &
Operations
DC, Programs
& Resources
Navy PPBE Process - HR Conference
DC, Aviation
Command,
Control, Comm &
Computers
Slide 66
DC, Installation
& Logistics
Dir, Health
Services
DC, Combat
Development
Dir, Intelligence
Department of the Navy
66
HQMC Organization
Commandant
CMC
Asst. Commandant
ACMC
Programs
& Resources
Aviation
Installations
& Logistics
Plans, Policy
& Operations
Manpower &
Reserve Affairs
Command, Control,
Comms & Computers
Legislative
Assistant
Inspector
General
Intelligence
Health Affairs
Public Affairs
Judge Advocate
Admin &
Resource Mgmt
Historical
• HQMC/P&R coordinates USMC PPBE
• Principal participants build the USMC program
Navy PPBE Process - HR Conference
Slide 67
Department of the Navy
67
USN and USMC Intersections
P&R
Blue
Cell
N88
N85
N43
FHP Lead
(O-5)
N8
Liaison
(O-4)
• Shared Resources:
• Blue/Green Split
• Jointly predetermined funding ratio between Services
• “BISOG” – Blue in Support of Green
• Funds held at USN level that support USMC programs
Navy PPBE Process - HR Conference
Slide 68
Department of the Navy
68
DoN Budget as a Share of DoD
TOA TY$B
POM08 USMC
POM08 DoN
POM08 B-G Split
POM10 USMC
POM10 DoN
POM10 B-G Split
~5%
Change
FY10
20.6
124.1
14.2%
27.2
133.3
17.0%
+ 2.8%
FY11
21.2
127.4
14.3%
28.0
138.1
16.9%
FY12
21.7
130.1
14.3%
28.7
141.6
16.8%
FY13
22.3
132.4
14.4%
28.6
144.3
16.5%
+2.6%
+2.5%
+2.1%
FY14
FY15
29.2
149.7
16.3%
30.0
152.3
16.5%
-
-
* PB 08 Increase experienced from Grow-the-Force
DoD TOA
Navy 72%
Marine Corps
17%
Navy PPBE Process - HR Conference
Slide 69
Direct
7%
Indirect 4%
Department of the Navy
69