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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 - [emailprotected]

• 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

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

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

GEN Navy PPBE Process Ward - HR Conference Slide 4

TRANSCOM GEN McNabb

Department of the Navy

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

The DoN Secretariat Secretary of the Navy Honorable Ray Mabus AG R. Leach

OLA RADM Miller

Under Secretary of the Navy Honorable Robert Work

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

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

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

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

Linking to External Partners: OSD and JCS DJS

J3 J5

J7 J8

Capability (JCS)

DNS

N3 N5

Specificity (OPNAV)

OPA

ASN (M&RA)

ASN (RD&A)

ASN (I&E)

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

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

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

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

PPBE Timeframes To Congress Spring 2010

POM12 (‘On Year’) Every Year

06 07 08 09 10

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

POM-12 Timeline

Navy PPBE Process - HR Conference

Slide 14

Department of the Navy

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

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

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

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

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

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

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

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

‘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

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

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

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

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

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

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

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

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

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

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

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

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

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

CAPE Comptroller VCJCS

SECDEF

Courses of Action

Department of the Navy

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

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

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

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

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

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

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

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

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

Slide 46

Department of the Navy

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

Congressional Budget Timeline 4

MAR

FEB

APR

MAY

PB To Hill

House

Concurrent Budget Resolution Senate

JUN 30 JUL

AUG

SEP

OCT

NOV

FY Begins

House CompletionTarget for FY09 Approps Bills

Markup

HBC Hearings

Floor

CONF

SBC Hearings

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

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

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

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

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

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

Three (and ½) Execution Phases: Summary 1

Obligation: Legal encumbrance; Specified amount for purpose or product when an order is placed 1½

Expenditure: Authorization for funds from Treasury resulting from presentation of a voucher or claim

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

Three Execution Timeframes Phase Current (1 yr +) Expired (5 yr +)

Cancelled

Oblig.

De-Obl.

Expend

Outlay

    X    X

Navy PPBE Process - HR Conference

Slide 57

X Department of the Navy

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

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Department of the Navy

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

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Department of the Navy

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

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

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

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Department of the Navy

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

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

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Department of the Navy

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

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

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

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

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Department of the Navy

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

[PDF] Navy Budget PPBE System - Free Download PDF (2024)

References