OMB fiscal 2019 budget guidance calls for ‘bold reform’

The fiscal 2019 budget may be more than a year away, but the Office of Management and Budget already has a forecast: a chance of more reorganization.

OMB released budget guidance July 7 for fiscal 2019, calling on the executive branch to push for even more efficiency cuts and restructuring while agencies are currently crafting reorganization plans ahead of fiscal 2018’s Sept. 30 deadline.

“These plans should include proposals in four categories: eliminate activities; restructure or merge; improve organizational efficiency and effectiveness; and workforce management,” the OMB document said. “The FY 2019 budget process will give special consideration to bold reform or reorganization proposals that have the potential to dramatically improve effectiveness and efficiency of government operations.”

OMB first rolled out its reorganization plan in April, with Director Mick Mulvaney calling on agencies to effectively rebuild the structure of the executive branch in a more effective and efficient form. It’s very likely that in addition to organizational shifts and cuts, these changes will also result in executive branch agencies leaning on more shared services and commonly bought technologies through strategically sourced acquisition practices, like category management.

Agencies were required to submit reorganization plans to OMB by June 30 — barring approved waivers — to later be finalized by the budget office Sept. 30 and put into effect during fiscal 2019.

The new fiscal 2019 guidance calls on agencies to continue those plans, while also requiring mandatory spending to be revenue-neutral with offsets.

Agencies are also directed to develop new programs that can drive efficiencies — OMB requires leaders to invest no more than five percent above their budget submission levels for the projects, which will be ranked by priority.

While agencies will be driving for more efficiency through reorganization, the guidance forbids them from across-the-board cuts, cost shifts to other parts of the budget, reclassifying discretionary spending to mandatory, increasing user fees or reducing mandatory spending through appropriations, unless directed by OMB.

Agencies must submit their fiscal 2019 plans — along with a draft strategic plan covering fiscal 2018-2022, a fiscal 2019 agency performance plan and priority goals for the fiscal 2018-2019 cycle — by Sept. 11.