White House Tells Agencies to Tighten Belts Further

Office of Management and Budget (OMB) Director Peter Orszag and White House Chief of Staff Rahm Emmanuel issued a memo today directing federal agencies to identify low priority programs that could be cut to reduce their funding by 5 percent for FY2012. National security-related agencies (e.g. the Departments of Defense and Homeland Security) are exempt.

The memo says in part:

“Your agency is required to identify the programs and subprograms that have the lowest impact on your agency’s mission and constitute at least five percent of your agency’s discretionary budget. This information should be included with your FY 2012 budget submission, but is a separate exercise from the budget reductions necessary to meet the target for your agency’s FY 2012 discretionary budget request.”

Considering how little progress has been made in Congress on finalizing the FY2011 budgets, it may be hard to think about FY2012 already, but in fact this is the time of year when agencies are readying their FY2012 requests. Although the FY2012 request will not be submitted to Congress by the President until next February, it takes almost the entire year to negotiate the request first within each agency, and then between the agency and the White House.

This part of the exercise must be completed by September 10, 2010 according to the memo. NASA, NOAA and NSF are among the agencies that will have to comply. NASA was not subjected to the freeze in non-security discretionary spending the Obama Administration mandated for FY2011, so there is no way to know what this means for the agency, but the obvious question is whether that $6 billion increase projected in NASA’s FY2011 budget request will turn out to be just a mirage.