Policy memo on biennial budgeting

What Is a Biennial Budget?

Sincesome 18 states have changed their budget cycles; 15 from biennial to annual and only 3 from annual to biennial. The pressures to revise the budget during the two-year period will be very strong, likely leading to frequent budget revisions and supplemental appropriation bills on a much larger scale than is desirable.

This analysis examines the limitations of biennial budgeting. By removing the purse strings for a year, you also make oversight less effective by removing the method by which government can monitor a program.

The Budget Committee allocates a total pot of discretionary funding to the Appropriations Committee, which then sub-allocates that amount among the 12 appropriations subcommittees.

If it is desirable to expand the list of programs that are funded in advance, that can be done without moving the entire federal budget to biennial budgeting. Both administrations understood that the important question for fiscal control is the total amount appropriated, not how quickly or slowly it happens to spend out.

This is very different from the annual budgeting done by other governments, including the federal government and most organizations. To help make the budgeting process more manageable, some states and municipalities operate under a biennial budget.

One response might be that the 20 traditional budget functions would still be listed in the report on the budget resolution. Under biennial budgeting, the amount of advance appropriations would expand to cover all discretionary programs.

If the economic and technical assumptions underlying the two-year budget resolution were not revised before the end of the biennium, the information and estimates that policymakers used would be far less reliable. It could diminish the effectiveness of Congressional control of spending in the appropriation process and could make adjusting to rapidly changing budgetary and economic conditions more difficult.

Since24 out of 44 states have abandoned biennial budgeting in favor of annual budgeting. It also promotes a longer-term view on the part of legislators concerning spending issues and revenue projections.

Lower-priority programs are likely to be reduced at slower rates because appropriators and Congress tend not to take big bites out of existing programs at one time.

Lawmakers submit and approve a budget that includes month appropriations on an odd year and focuses on budget oversight in even years. The apparent drawbacks are sufficiently serious that if federal policymakers wish to pursue biennial budgeting, the procedure should first be tested on an experimental basis with a limited number of budget accounts.

What Is a Biennial Budget?

The real issue — and the only important issue from the point of view of budget control — is how much is appropriated, and the existing system already restricts that total.The Congressional Institute supports a variation of biennial budgeting, according to which Congress drafts a two-year budget blueprint while maintaining annual appropriations bolstered by a robust authorization process.

In this way, lawmakers can exert control over government spending. Policy Memo On Biennial Budgeting Policy Memo Changing budgeting to a two-year cycle, known as biennial budgeting, has several advantages.

Biennial Budgeting: Do the Drawbacks Outweigh the Advantages?

It allows agencies to have longer time and. Proponents of biennial budgeting present it as a reform that will lead to more thoughtful and deliberative budgeting and allow more time for congressional oversight. Many budget experts, however, have concluded that the disadvantages of biennial budgeting outweigh the advantages and make it an unwise course to pursue.

• Agencies should prepare their biennial budget requests based on percent of their fiscal year adjusted base.

PERFORMANCE MEASUREMENTS IN BUDGETING • Agencies should seek to limit policy items unrelated to appropriation changes for inclusion in the Governor's budget.

Biennial budgeting is likely to make it even more difficult to reach compromises over major policy differences, because the stakes will be higher with a two-year budget than with a one-year budget. A biennial budget is one that lasts for two years, so any funding initiated by this budget is covered for a two-year period.

This is very different from the annual budgeting done by other governments, including the federal government and most organizations.

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Policy memo on biennial budgeting
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