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GAO-11-921R 1 (2011-09-29)

handle is hein.gao/gaobacfit0001 and id is 1 raw text is: 





        Accourtbility * Integrity * Reliability
United States Government Accountability Office
Washington, DC 20548




              September 29, 2011

              The Honorable Collin C. Peterson
              Ranking Member
              Committee on Agriculture
              House of Representatives

              Subject: USDA's Application of Administrative PA YGO to Its Mandatory Spending Programs

              Dear Mr. Peterson:

              In fiscal year 2010, about 80 percent of the U.S. Department of Agriculture's (USDA) total
              outlays of about $129 billion was used to fund mandatory spending programs-programs with at
              least some spending that is controlled through eligibility rules, benefit formulas, and other
              parameters that are set in law other than appropriations acts. At USDA, mandatory spending
              programs include the majority of the department's nutrition assistance, farm commodity, crop
              insurance, and export promotion programs, as well as a number of its conservation programs.

              To maintain spending discipline over the long-term, the President's budget for fiscal year 2006
              proposed a number of changes that would affect the budget process, including having the Office
              of Management and Budget (OMB) implement a budget-neutrality requirement on agency
              administrative actions affecting mandatory spending programs. A May 23, 2005, memorandum
              from the Director of OMB to the heads of departments and agencies provided guidance on a
              new OMB review process that would apply to administrative actions not required by law that
              would increase mandatory spending.1 As directed by the memorandum, in submitting to OMB
              for review such proposed actions, agencies must include one or more proposals for other
              administrative actions to be taken by the agency that would comparably reduce mandatory
              spending. This process for controlling spending is referred to as administrative pay-as-you-go
              (PAYGO).

              OMB's memorandum defines an increase in mandatory spending as an increase relative to the
              projection in the President's most recent budget or mid-session review of what is required,
              under current law, to fund mandatory spending programs. Administrative actions subject to
              administrative PAYGO include regulations, demonstrations, program notices, guidance to states
              or contractors, or other similar actions not required by law that would increase mandatory
              spending. Among other things, the memorandum states the following:


GAO-11-921R USDA's Application of Administrative PAYGO


1OMB, Budget Discipline for Agency Administrative Actions, M-05-13 (Washington, D.C.: May 23, 2005).

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