Federal agencies must identify better opportunities for savings and enhance accountability increase so as to ensure success in administering their programs. This is because of the fiscal pressures that the nation is currently facing. Consequently, better resource management is so critical given the uncertainty of their operating budget. Due to these, GAO carried out a research and issued a report which addresses the various strategies being used by federal managers in executing their budgets despite the uncertainty and disruptions of such operating budgets. Besides this, it also addresses the legal considerations to be balanced by agency managers in executing their budget. This paper covers a summary of this report, the challenges that the managers face in executing their budget and the various strategies used to overcome such challenges.
The GAO report on budget states that uncertainty and disruptions in the operating budget for most federal agencies is the most common challenge the agencies face in administering their programs. Such uncertainty has a huge impact on the timing of the spending. To overcome this challenge, the report states that most federal agencies limit their spending at the beginning of the fiscal year since the expected final decisions on funding may be less. The three main sources of uncertainty and disruptions in budget as identified in this report are continuing resolutions, sequestration and lapse in appropriations. Continuing resolutions allow the agencies to carry on with administering their programs even if the regular bill appropriation has not been enacted in time. The challenges faced in the continuing resolution period persisted even after the agencies had received their full year appropriations. Such challenges include delayed hiring or contract (Krause, 2017)
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Accountability and fiscal control by the agencies must be ensured through all the means possible. This is why the congress has set some controls to be followed by the agencies to ensure that this is achieved. The report indicates that how the funds can be spent throughout the year is determined by the legal constraints on the purpose and amount of the funds available. Such controls by the congress include the bona fide rule which requires an agency to state a genuine need for expenditure and not just any use up of the remaining funds before the end of the fiscal year. Another control is the need to avoid both the over-obligating and under-obligating of funds by the agencies. Agencies are prevented from incurring expenditures which are excess of the funds to be appropriated in the fiscal year. Conversely, the agencies are barred from failing to obligate the funds given out by the congress for their use. But obligation delays may happen due to other reasons which are out of the control of the agencies.
The other challenge that agency managers face when executing their budget as indicated in this report is the legal constraints and other considerations put up by congress to be balanced. Managers of the federal agencies have several options available to them while executing their budget. It becomes very difficult in choosing a given option as it may provide the best way to execute the operating budget and offer the best technique of administering the programs. According to Krause (2017), the legal constraints put up by the congress is a challenge as it restricts the agencies to work under tight schedule and may sometimes face the same problems available when there are no legal constraints. The multiple considerations that affect the execution of the operating budget are fiscal characteristics of funds and the needs according to the bona fide rule. All these legal constraints determine the amount and time of available funds and hence their use in carrying out the agency programs. The major challenges faced are the hiring or contract allocation which affects the overall duty of the agencies and services provided.
Agency managers have come up with several solutions to try and manage the challenges that they face in the execution of their operating budget. To counter the problem of uncertainty and disruptions of operating budget, agency managers have opted to limit their spending at the beginning of the fiscal year because the decisions on the final funding may be less than as expected. This is achieved by shifting contracts or hiring to later in the fiscal year to prevent repetition in carrying out the duties. Obligation of funds to latter part of fiscal year helps the agencies to be more flexible in the implementation of their programs as it is easier in the execution of the budget. To manage the several considerations and legal constraints, agencies have opted to work according to the controls provided by the congress. As a criminal justice leader, I would follow strategic steps to work through a specified budgetary plan as stated in this report. The steps include setting realistic goals, identifying the budget available and time of fund allocation, separation of the needs from wants to help carry out the agency’s programs, designing the budget and finally putting the plan into action ( Di Francesco & Alford, 2017).
References
Di Francesco, M., & Alford, J. (2017). Balancing budget control and flexibility: the central finance agency as ‘responsive regulator’. Public Management Review , 19 (7), 972-989.
Krause, H. (2017). Budget Uncertainty and Disruptions Affect Timing of Agency Spending [Ebook]. Washington, D.C: Government Accountability Office. Retrieved from https://www.gao.gov/assets/690/687264.pdf
