OMB seeks agency outreach on linking performance to budgets

Agency leaders must join the Office of Management and Budget in educating lawmakers about the benefits of performance-based budgeting, a Bush administration official said Thursday.

OMB is holding meetings on Capitol Hill to familiarize congressional staff members with President Bush's "budget and performance integration" effort. The initiative requires agencies to consider programs' performance goals and results when formulating budget requests. As part of the effort, OMB each year issues performance ratings for a sample of federal programs.

In turn, the White House wants congressional appropriators to base funding decisions at least partly on agencies' progress at meeting performance goals. But many lawmakers remain skeptical of performance-based budgeting, said OMB Deputy Director for Management Clay Johnson at a conference hosted by the Performance Institute, an Arlington, Va.-based think tank.

Agencies "get it," but only "isolated pockets" of Congress fully understand and embrace the concept, Johnson said. This remains one of the management initiative's greatest stumbling blocks, he added, and OMB will need the help of agency leaders to overcome it.

If agency managers take the time to discuss performance-based funding requests with appropriations committee staff members, Congress is more likely to pay attention to the new budgeting method, Johnson said.

During the fiscal 2004 budget process appropriators expressed skepticism over performance-based budgets submitted by the Veterans Affairs and Housing and Urban Development departments. In a committee report, appropriators said they "strongly disagree" with HUD's "efforts to substitute performance-based budgeting for the traditional budget structure." The materials submitted by HUD lacked adequate detail, were not organized to meet appropriators' needs and contained "minimal" useful information, the report stated.

But appropriators reacted more favorably to performance information submitted by NASA, partly because Sean O'Keefe, the agency's administrator, spent time helping them understand the budgeting method, Johnson said. NASA's success illustrates that Congress is capable of eventually making the transition to performance-based budgeting, Johnson said.

A House Government Reform Committee staff member shared a similar message with conference participants. The committee for several years has urged appropriators to use formal program evaluations completed by OMB, often to little avail, said Mason Alinger. For performance budgeting to gain ground on the Hill, agency leaders and OMB must continuously push authorizing and appropriating committees, he said.

At a recent congressional hearing on program evaluations, Jonathan Breul, a senior fellow at the IBM Center for the Business of Government, recommended that agency managers set up meetings with appropriators before submitting budget requests, to discuss the inclusion of performance-based information. Managers should find out where, and in what format, lawmakers would like to see performance materials, he said.

Lawmakers also might take performance-based budgets more seriously if legislation requiring OMB to conduct program reviews at least every five years passes, Alinger said. This could alter the impression that the Bush administration's annual program assessments are merely the latest management fad.

Regardless of whether legislation institutionalizing program assessments is approved, performance-based budgeting is taking hold at the agency level, and the practice is likely to survive when Bush leaves office, Johnson said. The budget and performance integration initiative is not a politically motivated project, but is simply designed to promote better management, he said.