The Mission and Structure of the Office of Management and Budget

The core mission of OMB is to serve the President of the United States in implementing his vision across the Executive Branch.  OMB is the largest component of the Executive Office of the President.  It reports directly to the President and helps a wide range of executive departments and agencies across the Federal Government to implement the commitments and priorities of the President.

As the implementation and enforcement arm of Presidential policy government-wide, OMB carries out its mission through five critical processes that are essential to the President’s ability to plan and implement his priorities across the Executive Branch:

  1. Budget development and execution, a significant government-wide process managed from the Executive Office of the President and a mechanism by which a President implements decisions, policies, priorities, and actions in all areas (from economic recovery to health care to energy policy to national security);
  2. Management — oversight of agency performance, Federal procurement, financial management, and information/IT (including paperwork reduction, privacy, and security);
  3. Coordination and review of all significant Federal regulations by executive agencies, to reflect Presidential priorities and to ensure that economic and other impacts are assessed as part of regulatory decision-making, along with review and assessment of information collection requests;
  4. Legislative clearance and coordination (review and clearance of all agency communications with Congress, including testimony and draft bills) to ensure consistency of agency legislative views and proposals with Presidential policy; and
  5. Executive Orders and Presidential Memoranda to agency heads and officials, the mechanisms by which the President directs specific government-wide actions by Executive Branch officials.

Organizationally, OMB has offices devoted to the development and execution of the Federal Budget, various government-wide management portfolios, and OMB-wide functional responsibilities.

Budget Formulation and Execution

OMB has five resource management offices (RMOs), organized by agency and by program area. These offices, together with OMB’s Budget Review Division, help to carry out OMB’s central activity of assisting the President in overseeing the preparation of the Federal Budget and supervising its administration of Executive Branch agencies.  In helping to formulate the President’s spending plans, the RMOs assess the effectiveness of agency programs, policies, and procedures, weigh competing funding demands within and among agencies, and help work with agencies to set funding priorities.  Once the Budget is enacted, RMOs are responsible for the execution of Federal budgetary policies and provide ongoing policy and management guidance to Federal agencies.  As part of these and other responsibilities, the RMOs provide analysis and evaluation, oversee implementation of policy options, and support government-wide management initiatives.

The Budget Review Division (BRD) plays a central role in developing and implementing the President’s Budget.  BRD provides leadership and analytic support across the agency by analyzing trends in and the consequences of aggregate budget policy.  It aggregates data provided by the RMOs, provides strategic and technical support for budget decision-making and negotiations, and monitors congressional action on appropriations and other spending legislation.  In addition, BRD provides technical expertise in, and guidance on, budget concepts and execution.

The Management Side of OMB

The Deputy Director for Management (DDM) also serves as the nation’s first Federal Chief Performance Officer (CPO).  The DDM/CPO develops and executes a government-wide management agenda that includes information technology, financial management, procurement, performance, and human resources.

The management side of OMB is comprised of five offices, four of which are statutory, that oversee and coordinate the Administration’s procurement, financial management, e-government, performance and personnel management, and information and regulatory policies.  In each of these areas, OMB’s role includes not only administrative management functions, but also program and policy management (e.g., program delivery and outcomes).  This role encompasses oversight of how agencies devise, implement, manage, and evaluate the statutory programs and policies for which they are responsible.  This responsibility is central to OMB’s efforts to assist in agency strategic planning, goal-setting, performance measurement, information management, evaluation, and policy research.  These functions are essential parts of the policy and program direction advice that OMB provides.

The management offices develop and oversee the President’s management plan and other government-wide management policies, and work primarily with and through the RMOs and the agencies to ensure that these policies are implemented:

  • The Office of Federal Financial Management (OFFM) develops and provides direction to improve financial management and systems; to reduce improper payments; to improve grants management; and to “right-size” Federal real property. OFFM also coordinates the activities of the Chief Financial Officers, and Senior Real Property Officers.
  • The Office of Federal Procurement Policy (OFPP) works with agencies to improve Federal procurement practices that affect the full range of Federal acquisitions.
  • The Office of E-Government and Information Technology, headed by the Federal Government’s Chief Information Officer, develops and provides direction in the use of Internet-based technologies to make it easier for citizens and businesses to interact with the Federal Government, save taxpayer dollars, and streamline citizen participation.
  • The Office of Performance and Personnel Management (OPPM) works with agencies to encourage use and communication of performance information and to improve results and transparency.  OPPM also works closely with OPM to advance effective personnel practices.
  • The Office of Information and Regulatory Affairs (OIRA) has a number of functions, including information policy, statistical policy, and regulatory policy.

Regulatory Review and Paperwork Reduction

Executive Order 12866, "Regulatory Planning and Review," issued by President Clinton on September 30, 1993, gives OIRA within OMB the responsibility to review agencies’ draft proposed and final regulatory actions.  With respect to regulatory policy, OIRA’s mission includes ensuring coordination and interagency review within the Executive Branch, including offices within OMB and the Executive Office of the President; promoting adherence to the law and to the President’s priorities and commitments; and ensuring that regulations are based on sound analysis and serve the purposes of the statutes that authorize them and the interests of the public.  Specifically, OIRA’s review of draft proposed and final significant regulations helps ensure that the agency has adequately defined the problem that it intends to address; considered alternatives; assessed available information, risks, costs, and benefits (both qualitative and quantitative); consulted affected parties and promoted transparency and participation; and tailored the regulation to focus on the problem in a simple and clear way that does not conflict with other rules or statutes.  OIRA seeks to ensure, to the extent permitted by law, that the benefits of agency regulations justify the costs and that the chosen approach maximize net benefits to society.  OIRA also administers the Paperwork Reduction Act of 1995, which calls for clearance and assessment of information collection requests by agencies.

Legislative Clearance and Coordination

OMB clears agency views on legislative proposals and testimony to ensure consistency in the Administration’s policy positions. 

  • Legislative Proposals.  All bills that Executive agencies wish to transmit to the Congress are sent to OMB for clearance. OMB circulates the bills to other affected agencies and appropriate EOP staff.  Agencies reviewing a draft bill may favor it or have no objection.  One or more may propose substantive or technical amendments, or perhaps a complete substitute.  Divergent views can be reconciled by telephone, letter, e-mail, or interagency meetings called by OMB. 

    After review, analysis, resolution of issues, and obtaining appropriate policy guidance, OMB advises the proposing agency that (1) there is “no objection” from the standpoint of the Administration’s program to the submission of the proposed draft bill to the Congress, or (2) the proposed bill is “in accord with the President’s program,” if it implements a Presidential proposal.  The submitting agency conveys this “advice” to the Congress in its transmittal letter.  (Major legislation is sometimes transmitted by the President.)  On the other hand, if the agency is advised that its proposed bill conflicts with an important Administration objective, or is not in accord with the President’s program, it may not transmit the bill to the Congress.  In practically all instances, however, disagreements are resolved through discussions at the policy levels of OMB and the agencies.
  • Clearance of Agency Testimony and Letters on Pending Legislation.  If agencies are asked by congressional committees to testify or send letters on pending legislation, or wish to volunteer a letter, similar clearance procedures are followed as for legislative proposals, described above.
  • Statements of Administration Policy (SAPs).  OMB prepares SAPs for major bills scheduled for House or Senate floor action in the coming week, including those to be considered by the House Rules Committee.  SAPs are prepared in coordination with other parts of OMB, the agency or agencies principally concerned, and other EOP units.  Following its clearance, a SAP is sent to Congress by OMB’s Legislative Affairs Office.  OMB also publishes these Statements to its public website.
  • Enrolled Bills and Signing Statements.  After Congress has completed action on a bill, it is “enrolled” (i.e., sent to the President for his approval or disapproval), together with drafts of any signing statements.  The Constitution provides that the President shall take action within 10 days after receipt of the bill, not including Sundays.  To assist the President in deciding his course of action on a bill, OMB requests each interested agency to submit within 48 hours of a bill’s passage its analysis and recommendation in a letter to OMB.  Such views letters are signed by the head of the agency or other Presidential appointee.  OMB prepares a memorandum to the President on the enrolled bill which transmits these views letters and summarizes the bill, significant issues, and various agency and OMB recommendations.  If an agency recommends disapproval, it is responsible for preparing a draft of an appropriate statement for the President’s consideration.  In considering whether a signing statement should issue upon a bill’s signing on the basis of constitutional considerations, OMB’s Office of General Counsel identifies relevant legal issues, in consultation with the Department of Justice and the Office of the White House Counsel, and drafts the legal issues sections of any signing statements.

President’s Executive Orders and Memoranda to Agency Heads

Under Executive Order 11030, as amended, OMB substantively reviews and clears all draft Presidential Executive Orders and Memoranda to Agency Heads prior to their issuance.  Any agency head or White House component wishing to sponsor an executive order or Presidential memorandum formally requests such an order or memorandum from OMB.  OMB works with the policy sponsor to draft or refine the proposed order or memorandum; submits the draft to an interagency clearance process; and works with the policy sponsors to address agency comments and resolve disputes.  The OMB General Counsel also obtains “form and legality” approval of draft executive orders from the Department of Justice, and seeks legal authority approval from the Department of Justice for Presidential memoranda as well.  Draft executive orders and Presidential memoranda are submitted for signature to the President by the Director of OMB and the General Counsel of OMB.

Other OMB Offices

Other OMB offices include Intellectual Property Enforcement Coordinator, Management and Operations, Communications, Economic Policy, General Counsel, Legislative Affairs, and Legislative Reference.

The Office of the Intellectual Property Enforcement Coordinator (IPEC) is responsible for formulating and implementing the Administration’s strategic plan to combat counterfeiting and other forms of intellectual property infringement. The IPEC office collaborates closely with the array of agencies responsible for intellectual property enforcement to develop an effective government-wide strategy to maximize the effectiveness of available resources. The IPEC office also works closely with the Director, components of OMB, and other offices within the White House, to establish intellectual property policies that promote innovation and to provide advice on a host of intellectual property issues.

The Office of Economic Policy (EP), along with the Department of the Treasury and the Council of Economic Advisers (CEA), develops economic assumptions for the President’s Budget and works closely with BRD on budgetary issues.  EP assists RMOs with budget estimates, policy proposals, cost models, and other data analytics, especially in the areas of credit and insurance, health, labor, education, and tax policy.  EP plays a leadership role in government-wide program evaluation efforts.  EP is responsible for the Circular setting Federal discount rate policy.  EP also assists the management side of OMB by analyzing procurement policy and issues related to Federal pay and benefits.

OMB’s Office of General Counsel provides legal advice and counsel to the Director and the OMB components and staff.  In addition, the General Counsel’s Office manages the Executive Order and Presidential Memoranda process for OMB and the Administration; reviews and clears all legal and constitutional comments by the Department of Justice and other agencies on proposed legislation before such comments are conveyed to Congress; participates in the drafting of bill signing statements for the President; reviews all proposed legislative text comprising the President’s Budget and for all budget-related legislative proposals; evaluates legal issues in proposed regulations; convenes meetings of all agency general counsels and coordinates legal issues across agencies; and ensures OMB’s compliance with ethics laws, the Freedom of Information Act, the Federal Records Act, and other statutory requirements.

OMB’s Office of Legislative Affairs works closely with White House Office of Legislative Affairs, Federal Agency Legislative Affairs offices, and congressional offices on current legislative issues.  The office conveys information and strategies to the Director to inform decisions on Administration policies.  The office, in turn, disseminates budget materials, descriptions of relevant concerns, and statements to Congress to communicate the Administration’s positions.  The Office of Legislative Affairs also advises the OMB Director and the organization on legislative issues and developments, provides expertise on the congressional budget process, supplies daily congressional reports to the Director and the OMB staff, oversees correspondence with the Hill, and manages the clearance and transmittal of the President’s Budget and the Administration’s Statements of Administration Policy.

The Legislative Reference Division coordinates the articulation of the Administration’s position on legislation by overseeing the review and clearance of the Administration’s legislative proposals, testimony, and statements on bills progressing through Congress.

The remaining offices provide OMB-wide support and guidance in a number of areas.  For example, the Management and Operations Division helps ensure that OMB has the staff resources, physical facilities, equipment, and information systems needed to accomplish its mission. The Strategic Planning and Communications Office is the principal resource of national, regional, and local media organizations for information about the Federal Budget and other areas of OMB responsibility.  OMB also shares responsibility for space management and building construction policy with GSA and responsibility for personnel policy with Office of Personnel Management.