A bill to require agencies submit zero-based budgets.
- Bill Number
- S. 181
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 1
- Policy Area
- Economics and Public Finance
- Status
- Introduced
- Latest Action
- 2025-01-22: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.
- Last Updated
- 2025-02-28T19:31:40Z
AI-Generated Summary
Purpose
The legislation aims to promote fiscal efficiency and accountability in federal budgeting by requiring executive agencies to periodically prepare and submit zero-based budgets. This approach starts from a "zero base" each cycle, forcing agencies to justify all expenditures rather than relying on previous budgets, and includes recommendations for spending reductions.
Key Provisions
- Definitions:
- Agency: Refers to any executive department, government corporation, or independent establishment of the federal government, as defined in section 551 of title 5, United States Code (the Administrative Procedure Act).
- Zero-based budget: A detailed budget process where agency managers must review current goals, activities, and expenses; explore alternative methods to achieve objectives; and prioritize programs based on their importance to the agency's mission.
- Submission Requirement: Every six years, each agency must submit a zero-based budget to the Director of the Office of Management and Budget (OMB), the Senate Committee on the Budget, and the House Committee on the Budget. The budget covers the upcoming fiscal year and the four following years.
- Spending Reduction Recommendations: In addition to the zero-based budget, agencies (excluding the Department of Defense and the National Nuclear Security Administration) must propose cuts or reductions in discretionary spending programs. These recommendations must total at least a 2% decrease from the previous year's appropriations.
Significant Changes to Existing Law
- Introduces a mandatory, cyclical zero-based budgeting process, which differs from the current incremental budgeting system where agencies typically base new budgets on prior-year figures with adjustments.
- Adds a new layer of reporting to OMB and congressional budget committees, without altering the overall federal budgeting timeline under the Congressional Budget and Impoundment Control Act of 1974.
- Exempts defense-related entities from the 2% cut recommendations, creating a targeted carve-out not present in prior law.
Potential Impacts
- On Government Agencies: Agencies will face increased administrative workload for detailed budget justifications every six years, potentially leading to more streamlined operations, program eliminations, or reallocations. Non-defense agencies may experience pressure to identify efficiencies, while the Department of Defense and National Nuclear Security Administration are shielded from mandatory cut proposals.
- On Citizens: Could result in more efficient use of taxpayer dollars through reduced wasteful spending, though actual cuts depend on congressional action. Indirect benefits might include lower federal deficits or stabilized taxes, but short-term disruptions to programs could affect public services.
- On International Relations: Minimal direct impact, as the bill focuses on domestic agency budgeting; however, if reductions affect foreign aid or international programs, it could influence U.S. diplomatic commitments.
Main Stakeholders Affected
- Federal Agencies: Primary implementers, required to conduct analyses and submit reports, with non-exempt agencies facing additional pressure for spending cuts.
- Office of Management and Budget (OMB): Receives submissions and may use them to guide presidential budget proposals.
- Congressional Budget Committees: Gain detailed insights to inform appropriations decisions and oversight.
- Taxpayers and the Public: Indirectly affected through potential changes in government spending efficiency and program funding.
Notable Legal, Constitutional, or Political Implications
- Legal: Establishes enforceable reporting obligations under federal budgeting statutes but does not mandate automatic cuts—reductions require separate congressional appropriations. No apparent conflicts with constitutional separation of powers, as it enhances congressional oversight of the executive branch.
- Constitutional: Aligns with Congress's power of the purse (Article I, Section 9) by providing tools for informed spending decisions without infringing on executive budgeting authority.
- Political: Encourages fiscal conservatism by institutionalizing budget scrutiny, potentially sparking debates over program priorities and exemptions for defense spending; implementation would depend on bipartisan support in appropriations processes.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (6)
Sen. Crapo, Mike [R-ID], Sen. Ricketts, Pete [R-NE], Sen. Cruz, Ted [R-TX], Sen. Sheehy, Tim [R-MT], Sen. Scott, Rick [R-FL], Sen. Lummis, Cynthia M. [R-WY]
Recent Actions
- 2025-01-22: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.
- 2025-01-22: Introduced in Senate
Bill Versions
- To require agencies submit zero-based budgets. — issued 2025-01-22 — PDF (2 pages)