Should the Federal Gov’t Stop Using Budget Baselines and Justify All Spending Each Year? (H.R. 507)

What is H.R. 507?

(Updated September 12, 2018)

This bill — the ZERO Act — would require federal agencies to submit budget requests each year that assume the baseline budget is zero, meaning that they have to justify spending on all existing and newly requested programs. A department or agency budget would have to include a description of each activity; the legal basis for the activity; three alternative funding levels with the priorities that could be accomplished at each, two of which must be below the current level; and measures of cost efficiency for each activity.

This bill’s full title is the Zero-based Budgeting Ensures Responsible Oversight (ZERO) Act of 2017.

Argument in favor

By instituting zero-baseline budgeting, federal agencies would be forced to justify all their spending and end the “use it or lose it” attitude that leads to unnecessary spending so as to justify keeping the funding next year. That will save taxpayer dollars and cause lead to wiser spending.

Argument opposed

The federal government is the largest organization on Earth, and just because there’s some wasteful spending that doesn’t mean federal agencies should have to justify everything they spend tax dollars on. They should be able to make reasonable assumptions about budget baselines.

Impact

Taxpayers; federal agencies; and the president.

Cost of H.R. 507

A CBO cost estimate is unavailable.

Additional Info

In-Depth: Sponsoring Rep. Dennis Ross (R-FL) has introduced versions of zero baseline budget legislation in the last several sessions of Congress, saying in 2015:

“We have to justify our existence every day in the private sector — changes to attitudes, trends. You have to adapt. Government doesn’t adapt. Instead it just incrementally adds on. We should be painfully honest with the American people, because it’s their money. When we do the budget process, we want to have some justification for every appropriation that is sought — a legal basis for it, an amount that is less than last year’s and a summary to express the outcome of it.”

Of Note: The federal government last used zero-based budgeting during the administration of former President Jimmy Carter,but the way its implementation was complex, time-consuming, and ultimately didn’t result in savings. As detailed in GovExec, the Carter administration used zero-based budgeting by requiring each agency to identify “decision units” in its budget, which created “decision packages” detailing proposed spending with four different funding levels. Managers then ranked those decision packages and advanced them up the bureaucracy for more review and prioritization. When the Reagan administration took office, they abandoned the practice.

Media:

• Sponsoring Rep. Dennis Ross (R-FL) Fact Sheet (Previous Version)
  
• Sunshine State News
  
• Government Executive (Previous Version)
  
• Washington Times (Previous Version)