The Federal government evaluates program effectiveness through a variety of methods to ensure that taxpayer money is being used wisely and that programs are achieving their intended goals. These evaluations can include performance measurement, where agencies track specific metrics, as well as in-depth program evaluations conducted by internal or external experts.
The Foundations for Evidence-Based Policymaking Act of 2018 (Evidence Act) has strengthened these efforts, requiring agencies to develop annual evaluation plans and build evidence to support their policies. The Government Accountability Office (GAO) also plays a crucial role by conducting independent audits and evaluations of federal programs for Congress. You can find agency-specific evaluations on their websites and GAO reports on GAO.gov. Organizations, like the Tax Project, also provide third party transparency and support Open Government initiatives.
Following money from its appropriation by Congress to its eventual use by a federal agency is fundamental to government transparency. The primary public tool for this is USAspending.gov, the official federal website for spending data or the Smarter Citizen app by the Tax Project. It allows you to track funds from the appropriation level down to specific awards, like contracts and grants.
On USAspending.gov and the Smarter Citizen app, you can search for information by agency, program, location, or recipient. They provide details on the different stages of spending, including budget authority, obligations, and outlays. For more in-depth information, you can also review an agency’s annual congressional budget justification documents. These are usually available on the agency’s own website and provide a detailed breakdown of how they plan to use their requested funds.
The federal budget process is an annual cycle that determines how the U.S. government will raise revenue and spend money. It begins with the President’s budget request, which is submitted to Congress early in the year. This document outlines the administration’s policy and funding priorities for the upcoming fiscal year, which starts on October 1st.
After the President’s submission, Congress develops its own budget plan, called a budget resolution, which sets overall spending limits. Then, the House and Senate Appropriations Committees work to pass 12 separate appropriations bills to fund different parts of the government. For these bills to become law, they must be passed by both chambers of Congress and signed by the President. If this isn’t done by October 1st, Congress must pass a temporary measure, called a continuing resolution, to avoid a government shutdown. (See article)
The government accounts for the cost of federal credit and loan programs, such as student loans or small business loans, using a method established by the Federal Credit Reform Act of 1990. Instead of recording the full loan amount as a cost, the government calculates and records the estimated long-term cost of the loan to the taxpayer at the time the loan is made.
This cost, known as the “subsidy cost,” is the estimated net present value of all future cash flows from the loan, including principal and interest payments from borrowers, minus government expenses like defaults and administrative costs. This approach provides a more accurate picture of the long-term financial impact of credit programs on the federal budget. The specific subsidy rates and data are published in the President’s Budget.
The government budgets for disasters and emergencies through a combination of regular annual appropriations and supplemental funding. The Federal Emergency Management Agency (FEMA) receives an annual appropriation for its Disaster Relief Fund (DRF), which is used to pay for the response to and recovery from declared major disasters.
When a major catastrophe occurs, like a large hurricane or wildfire, the costs can exceed the amount available in the DRF. In these cases, Congress often passes a “supplemental appropriation” bill to provide additional, emergency funding outside of the regular budget process. This approach provides the flexibility needed to respond to unpredictable events while maintaining a base level of funding for routine disaster response.
The U.S. Treasury Department’s Office of Tax Analysis and the congressional Joint Committee on Taxation (JCT) are the primary bodies that estimate federal tax revenue. They use sophisticated economic models to forecast how much money the government will collect based on current tax law, economic conditions, and other factors. These revenue estimates are a key parts of the annual budget process.
“Tax expenditures” are provisions in the tax code that reduce the amount of taxes owed by individuals or businesses, such as deductions, credits, and exclusions. They are essentially spending programs that run through the tax system. The Treasury Department and the JCT are required to publish an annual list of tax expenditures, estimating how much revenue is forgone for each provision. This allows policymakers and the public to see the cost of these tax breaks, similar to how they would view direct spending programs.
The Federal government uses performance information to connect budget decisions with the actual results that agencies are achieving. The goal is to move beyond simply funding programs and instead invest in what works. The Government Performance and Results Act (GPRA) of 1993 and its subsequent modernization require agencies to set strategic goals, measure their performance, and report on their progress.
This performance information is a key component of an agency’s annual budget request. Agencies must describe how the funding they are requesting will help them achieve their performance goals. The Office of Management and Budget (OMB) reviews this information when developing the President’s Budget, and it is also available to Congress and the public on Performance.gov. This process is designed to create a more evidence-based and results-oriented approach to federal spending.
The Judicial Branch of the U.S. government, which includes the Supreme Court, lower federal courts, and various administrative offices, is funded through the annual appropriations process, just like federal agencies. The Judiciary prepares a budget request each year, which is submitted to the President and Congress for consideration.
The budget for the Judiciary is included in the Financial Services and General Government appropriations bill, one of the 12 annual spending bills passed by Congress. This funding covers the salaries of judges and court staff, the costs of operating federal courthouses, and other expenses necessary to maintain the federal court system. You can find the Judiciary’s annual budget request and related documents on the website of the U.S. Courts.
The Legislative Branch, which includes the U.S. Senate, the House of Representatives, and various support agencies like the Library of Congress and the Government Accountability Office (GAO), is funded through an annual appropriations bill. This bill, known as the Legislative Branch Appropriations Act, is one of the 12 annual spending bills that Congress passes to fund the federal government.
Each chamber of Congress and each legislative agency develops its own budget request, which is then considered and debated as part of the appropriations process. This self-funding mechanism is established by the Constitution to ensure the Legislative Branch remains an independent and co-equal branch of government. Detailed information on legislative branch funding can be found in the appropriations bills and committee reports, which are public documents available on Congress.gov.
A Continuing Resolution (CR) is a temporary measure used during the Budget Process, a stopgap funding measure used to prevent a government shutdown when the regular appropriations bills have not been passed by the October 1st deadline. A CR typically continues funding for federal agencies at the previous year’s levels for a specific period, allowing more time for Congress to negotiate a final budget.
An “omnibus” appropriations bill is a single, large piece of legislation that combines many or all of the 12 individual annual appropriations bills into one package. Lawmakers often use this method to finalize government funding when time is short. While an omnibus can be an efficient way to avoid a shutdown and pass a budget, it is often criticized for its lack of transparency, as its large size makes it difficult to scrutinize individual spending items.
Cross-Agency Priority (CAP) Goals are a limited number of high-priority, ambitious goals that the administration has set to be achieved through the coordinated effort of multiple federal agencies. These goals are designed to tackle complex challenges that cannot be solved by a single agency working alone, such as cybersecurity, customer service, or infrastructure permitting.
The CAP goals are a key part of the government’s performance management framework and are updated every four years with each new presidential term. The Office of Management and Budget (OMB) oversees the CAP goals, and progress is tracked and reported publicly on Performance.gov. This approach fosters a more collaborative and results-oriented government by focusing leadership attention on a few key outcomes that require interagency cooperation.
Independent agencies and government corporations are part of the executive branch but exist outside of the 15 Cabinet-level departments. “Independent agencies” are created by Congress to handle specific issues and are often designed to be insulated from political influence. Examples include the National Aeronautics and Space Administration (NASA), the Environmental Protection Agency (EPA), and the Central Intelligence Agency (CIA).
“Government corporations” are agencies that are structured like private businesses and are designed to perform a commercial function. They are typically self-supporting and generate their own revenue. Prominent examples include the U.S. Postal Service (USPS) and the Tennessee Valley Authority (TVA).
Special funds and trust funds are two types of accounts used in the federal budget to designate money for specific purposes. “Trust funds” are accounts designated by law to hold funds collected and spent for specific programs, such as Social Security and Medicare. These are financed through dedicated taxes and other collections, like payroll taxes.
“Special funds” are also accounts for revenues that are designated for specific purposes. The term is often used for accounts that are not designated as trust funds. An example is the fund that collects revenues from the Federal gasoline tax to be spent on highway construction. The use of these dedicated funds ensures that certain revenues are used only for their intended purpose.
The President’s Cabinet is composed of the heads of the 15 executive departments, who are appointed by the President and confirmed by the Senate. These departments are the primary units of the executive branch and are responsible for administering a wide range of federal laws and programs.
The 15 Cabinet departments are the Departments of Agriculture, Commerce, Defense, Education, Energy, Health and Human Services, Homeland Security, Housing and Urban Development, the Interior, Justice, Labor, State, Transportation, the Treasury, and Veterans Affairs. The heads of these departments, known as Secretaries (except for the head of the Department of Justice, who is the Attorney General), serve as key advisors to the President.
An earmark is a provision inserted into a discretionary spending bill that directs funds to be spent on a specific project, often in a particular lawmaker’s home state or district. Earmarks became controversial due to concerns that they were used for wasteful “pork-barrel” projects and were not always awarded based on merit.
In 2011, Congress placed a ban on earmarks. However, in 2021, the practice was brought back in a revised and more transparent form, now referred to as “Community Project Funding” in the House and “Congressionally Directed Spending” in the Senate. Under the new rules, lawmakers must publicly post their requests online and certify that they have no financial interest in the projects. This allows for dedicated funding for local projects, but with stricter transparency requirements than in the past.
Budget reconciliation is a special legislative process that Congress can use to pass certain bills related to spending, revenues, and the debt limit more easily. Its key feature is that it allows a bill to pass the Senate with a simple majority of 51 votes, bypassing the usual 60-vote requirement needed to end a filibuster.
The process can only be used on legislation that changes federal spending or revenues, and it is governed by a strict set of rules. Reconciliation begins with Congress passing a budget resolution that contains instructions for committees to develop legislation achieving specific budgetary outcomes. Because it offers a way around the filibuster, this process has been used to pass significant and often controversial laws, such as major tax reform or healthcare legislation.
The Anti Deficiency Act is a fundamental federal law that prohibits federal agencies from spending money that they do not have. The law makes it illegal for a federal employee to make or authorize an expenditure or obligation that exceeds the amount available in an appropriation or fund.
This law is a cornerstone of congressional control over Federal spending. It ensures that the Executive branch cannot spend more than Congress has approved, preventing agencies from running up unauthorized debts. Violations of the Anti Deficiency Act can result in administrative discipline, such as suspension or removal from office, as well as potential criminal penalties. The law is the primary reason that a lapse in appropriations leads to a government shutdown, as agencies are legally barred from incurring most obligations without funding.
“Authorization” and “appropriation” are two distinct steps in the federal funding process. An authorization act is a law that establishes or continues a federal agency, program, or activity. This law sets the program’s terms and conditions and provides a recommended funding level, but it does not actually provide the money.
An appropriation act is the law that gives a federal agency the legal authority to actually spend money. Congress must pass an appropriation bill each year to fund the programs that have been authorized. In short, an authorization act creates the program and sets a ceiling on how much can be spent, while an appropriation act provides the actual cash. A program can be authorized but will have no funding until an appropriation is passed.
Cash and accrual accounting are two different methods of recording financial transactions. “Cash accounting” recognizes transactions only when cash is actually received or paid out. For the federal budget, this is the primary method used, meaning that revenues are counted when collected and expenses (outlays) are counted when paid.
“Accrual accounting” recognizes revenue when it is earned and expenses when they are incurred, regardless of when the cash actually changes hands. This method provides a more complete picture of long-term financial commitments. The consolidated financial statements of the U.S. government are prepared on an accrual basis, which is important for understanding the full long-term costs of programs like federal employee pensions and loan guarantees.
The Congressional Budget Office (CBO) is a non-partisan agency that provides independent analyses of budgetary and economic issues to support the congressional budget process. The CBO does not make policy recommendations; instead, its mission is to provide Congress with objective, impartial information that helps lawmakers make informed decisions about the budget and the economy.
CBO’s key responsibilities include providing official cost estimates for legislation, publishing economic forecasts, and producing long-term projections of federal spending and revenue. All of CBO’s reports, cost estimates, and data are publicly available on its website, CBO.gov. This resource is essential for understanding the financial impact of proposed legislation and the nation’s long-term fiscal health.
The General Services Administration (GSA) serves as the primary procurement and property management agency for the federal government. Often described as the government’s “landlord” and “procurer,” the GSA’s main role is to provide centralized support services to federal agencies, allowing them to focus on their core missions.
The GSA is responsible for managing the vast portfolio of federal buildings and real estate, procuring goods and services for federal agencies, and managing the federal vehicle fleet. It also plays a key role in developing government-wide policies on topics like travel, property management, and technology. By centralizing these functions, the GSA aims to improve efficiency, reduce costs, and create a more effective federal government.
Think tanks are, often non-profit, organizations that conduct research and advocacy on public policy issues, and they play an influential role in the federal budget process. They provide in-depth analysis, data, and policy recommendations on a wide range of spending and tax issues from various ideological perspectives.
Think tanks across the political spectrum, such as the Economic Policy Institute, Brookings Institution, the Heritage Foundation, and the Committee for a Responsible Federal Budget, regularly publish reports, testimonies, and budget models. Their work informs and influences policymakers, the media, and the public, shaping the debate over fiscal policies.
These three terms represent distinct stages in the government spending process. “Budget authority” is the first step; it is the legal permission, granted by Congress, for a federal agency to spend money. Think of it as the total amount of funds approved for a specific purpose.
An “obligation” is the second step. This occurs when an agency makes a legal commitment to spend that money, such as by signing a contract, awarding a grant, or hiring staff. An “outlay” is the final step, representing the actual payment of money. This happens when the government’s bank, the U.S. Treasury, issues a check or electronic payment to pay for the obligation. Typically Outlay is Government parlance for Spending.
Federal spending is divided into two main categories: mandatory and discretionary. “Mandatory spending” is controlled by laws and not via annual appropriation acts and are largely automatic. It includes programs like Social Security and Medicare. The amount spent is determined by the number of people who qualify, not by a yearly congressional vote. Mandatory spending, mostly entitlements, takes up about two thirds of the Federal budget.
“Discretionary spending” is the portion of the budget that Congress determines annually through the 12 appropriations bills. This is where lawmakers decide how much to spend on a wide range of government activities, including National defense, education, transportation, and foreign aid. Unlike mandatory spending, discretionary spending is subject to a fixed, yearly budget limit.
Federal agencies are required by law to create and publish strategic plans and annual performance reports to ensure accountability and transparency. An agency’s Strategic Plan outlines its long-term goals and objectives, typically covering a four-year period. The Annual Performance Plan (APP) sets specific, measurable targets for the upcoming year, and the Annual Performance Report (APR) details the agency’s progress in meeting those targets.
These documents are key to understanding an agency’s mission, priorities, and effectiveness. You can typically find them on the agency’s own website, often in a section titled “About Us,” “Budget and Performance,” or “Strategic Plan.” Additionally, Performance.gov is a central federal website that provides a government-wide view of agency goals and progress.
The President’s annual Budget Request to Congress is a key public document that outlines the administration’s spending priorities and policy proposals for the upcoming fiscal year. This request, and the historical data that accompanies it, provides a detailed look at the nation’s finances.
The primary source for these documents is the website of the Office of Management and Budget (OMB). Each year, the OMB publishes the full budget request, along with supporting materials like analytical perspectives, historical tables, and appendices. The Government Publishing Office (GPO) also maintains an archive of Presidential budgets, providing access to data from both current and past administrations.
