DOD takes a different route to same goal

Budget process goes back and forth with OMB

In many ways, the Defense Department operates under different budget rules than do civilian agencies, but it still has the same two masters: the Office of Management and Budget, and Congress.

DOD's budget is developed piecemeal, with individual agencies first trying to prove the worth of their budgetary requests internally by certifying that key requirements are met.

That process starts at the military service level and works its way up to Office of the Secretary of Defense analysts, Joint Forces officials and, ultimately, Defense secretary Donald Rumsfeld.

After that, two key types of documents'Program Decision Memorandums and Program Budget Decisions'are sent to OMB in late summer and November, respectively, outlining all of the programs in the services, with analyses and projected budget figures for each program.

Included among the documents, as with budget requests from other agencies, are Exhibit 300 business cases. The only programs exempt from Clinger-Cohen Act criteria are national security systems, but these classified systems and programs must still go before OMB for funding clearance, according to Mike Yoemans, director of strategic resource planning at DOD.

The only difference is that the level of scrutiny for national security systems is higher than for other systems, officials said.

'Everything gets reviewed,' Yoemans said. 'We submit the same kind of paperwork the other federal agencies submit.'

PBDs and PDMs, which are part of a larger DOD process known as Programming, Budgeting and Execution, give OMB officials an idea of where programs are headed in the Defense Department and how long it will take for them to get there, said former Defense comptroller Dov Zakheim. The documents list out-year projections for each program, along with quantities needed, milestone reports, cost and scheduling goals, and joint reviews of the program.

The documents also outline how programs fit with other programs in the effort toward interoperability among major Defense systems.

It is a back-and-forth process: OMB takes the outlines and gives DOD its top budgetary line to stay within.

'When we submit the budget in late January, that's a budget that OMB has already agreed to,' said Zakheim, who now works as a vice president at Booz Allen Hamilton Inc. of McLean, Va.

When the budget goes to Congress, DOD goes to the Hill to argue for funding.

'Congress looks at that in pretty good detail,' said Maj. Gen. Paul Nielsen, the recently retired Air Force chief technology officer, now CEO and director of Carnegie Mellon's Software Engineering Institute.

'For the staffers there, this is their life. There are times where they will zing back questions to the service. They'll say we don't believe in that project and sometimes they'll cut a project,' Nielsen said.

If Congress isn't convinced about a particular program and votes to reduce funding, there's an appeals process where the DOD sends what's known as a 'heartburn letter' to the White House, detailing problems DOD has with cuts and imploring Congress to reconsider its decision.

As in the other services, Air Force officials do a six-year plan when putting together their budget.

'On the government side, we're on this cycle where we have already put to bed our 2006 budget. We have to send that in in January, two years ahead,' Nielsen said. 'Right now, Congress is getting ready to do their final deliberations on the 2005 budget in October and the data calls are starting right now for 2007.'

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