OMB MEMO INDICATES DEEPER CUTS IN STORE FOR FED BUDGETS IN FY’15

Tamar Hallerman
GHG Monitor
6/7/13

The White House is asking agency heads to cut 10 percent from their Fiscal Year 2015 budget proposals. In a memo to agency and department heads last week, White House Office of Management and Budget Director Sylvia Burwell said employees should anticipate “another challenging budget year,” asking that they submit a discretionary budget request that is 10 percent below the net total provided for each agency for 2015 in the 2014 budget. “We have not had the regular order budgeting process that we would prefer, and I understand the compounding challenges that agencies face in continuing to provide vital services and protect mission in an environment of sequestration,” Burwell said.

Burwell said agency heads should “look for ways to reduce fragmentation, overlap and duplication, and increase effectiveness” within their individual programmatic offices. The FY 2015 proposals to OMB should also include a separate section with an updated strategic plan and “innovative programmatic proposals” that can be fully paid for and include ideas to streamline operations and boost effectiveness. “The 2015 budget should continue to build on the President’s [FY 2014] plan, by reducing spending on lower priority programs in order to create room for effective investments in areas critical to economic growth and job creation, including education, innovation, infrastructure and research and development,” Burwell said. Perhaps most notably, the memo indicates that the FY 2015 blueprints should not incorporate the impact of the sequester since the President is hoping to replace the across-the-board spending cuts with tax increases, entitlement reform and targeted spending cuts. FY 2015 begins on Oct. 1, 2014.

FY 2014 Budget Debate Heating Up

OMB’s guidance comes a year after the White House office asked agency heads to trim their respective budget requests by another 5 percent for the FY 2014 appropriations cycle, which is currently beginning to ramp up on Capitol Hill. The House this week took up a more than $46 billion spending bill for the Department of Homeland Security and related programs, which the White House threatened to veto because it does not adhere to the funding caps agreed to in the 2011 Budget Control Act.

For federal energy and environment-related programs, the House and Senate Appropriations Committees have yet to release draft bills to counter the President’s FY 2014 budget request, but broad blueprints passed by each chamber earlier this year reflect diverging views on the subject matter. The House Appropriations Committee, controlled by Republicans, recently announced tight allocations for both the Energy-Water and Interior-Environment spending bills, which provide funding for the Department of Energy and the Environmental Protection Agency, respectively.

The President’s budget proposal, submitted to Congress in April, recommended a slight bump in funding for the Department of Energy overall but requested a 25 percent cut for coal R&D and CCS-related research. The White House also called for a 3.5 percent budget cut for the Environmental Protection Agency compared to FY 2012 levels, which led to sharp criticism from Congressional Democrats.