The U.S. Constitution vests Congress with the power to raise revenue and borrow money. Those funds may only by drawn from the Treasury in consequence of appropriations made by law. The Constitution, however, is largely silent with respect to the President's role in the budget process. Instead, the executive budget process as it exists today is primarily the result of statutes enacted by Congress. The Budget and Accounting Act of 1921 (P.L. 67-13; 42 Stat. 20-27) established the modern executive budget process. Prior to its enactment, executive budgeting was highly decentralized. At that time, agencies submitted their budget estimates to Congress individually, either directly or through the Secretary of the Treasury, with varying levels of involvement or direction by the President. The Budget and Accounting Act altered this practice by establishing a legal framework for a consolidated federal budget proposal to be developed by the President and submitted to Congress prior to the start of each fiscal year. This report outlines many of the budgetary procedures that are performed by the President, the Office of Management and Budget (OMB), and agencies. This report provides an overview of the development, submission, and justification of the President's budget proposal. This report also describes how the President, OMB, and agencies execute the federal budget following the enactment of appropriations and other budgetary legislation by Congress. The President's budget, or the Budget of the United States Government as it is referred to in 31 U.S.C. Section 1105(a), is a statement of the President's policy priorities and a unified plan for the allocation of federal budgetary resources. The President's budget is a set of recommendations. Congress is not required to adopt the recommendations contained within the President's budget. Nevertheless, the budget is one of the President's most important policy tools. Though it is not legally binding, the President's budget initiates the congressional budget process and provides Congress with recommended spending levels for agency programs, projects, and activities funded through the annual appropriations acts. The President's budget also includes budgetary projections based on existing law and provides Congress with estimations of the effects the President's revenue and direct spending proposals will have on those projections. Under current law, the President is responsible for developing and submitting a consolidated budget to Congress no later than the first Monday in February prior to the start of the fiscal year. The development of the President's budget begins approximately 18 months prior to the start of the fiscal year that the budget will cover, which is about 10 months before the President must submit the proposal to Congress. To put this timeline in context, as Congress begins action on appropriations bills and other budgetary legislation for the upcoming fiscal year, OMB and agencies have already begun planning for the subsequent fiscal year. In practice, the President has delegated to OMB certain budgetary tasks and authorities necessary for developing the budget. OMB coordinates the development of the President's budget proposal by issuing circulars, memoranda, and guidance documents to the heads of executive agencies. Executive agencies then prepare their budget requests in accordance with the instructions and guidance provided by OMB. OMB Circular No. A-11 (hereinafter Circular A-11) is an extensive document that contains instructions and schedules for agency submission of budget requests and justification materials to OMB. Updated annually, Circular A-11 provides agencies with an overview of applicable budgetary laws, policies for the preparation and submission of budgetary estimates, and information on financial management and budget data systems. Circular A-11 also provides agencies with directions for budget execution and guidance regarding agency interaction with Congress and the public. Early in the development phase, OMB issues a budget planning guidance memorandum, also referred to as the "Spring Guidance," which provides executive agencies with detailed instructions and deadlines for submitting their budget requests and supporting materials to OMB. The guidance may also include specific instructions for how agency budget requests may help achieve the President's budgetary priorities and other policy goals. For example, the FY2013 Budget Guidance instructed, [u]nless your agency has been given explicit direction otherwise by OMB, your overall agency request for 2013 should be at least 5 percent below your 2011 enacted discretionary appropriation ... [and] should also identify additional discretionary funding reductions that would bring your request to a level that is at least 10 percent below your 2011 enacted discretionary appropriation. While the general contents and timeline for agency budget submissions are guided by OMB, agencies also have their own internal procedures for developing the requests they submit to OMB. In practice, budget preparation is likely a time- and data-intensive process for agencies, involving detailed analysis and estimation of past and future budgetary resources. Agency budget requests are submitted to OMB in early fall, approximately four to five months before the President must submit the budget to Congress. OMB has been delegated the responsibility of reviewing executive agency requests and justification materials to ensure that they are consistent with the President's policy objectives. Agency requests are first reviewed by the OMB program examiners who are responsible for the associated policy areas. Agency requests may also be reviewed by more senior OMB officials. Prior to making a recommendation, OMB program examiners may ask for additional information from agencies, either informally or by conducting formal hearings. Examiners' recommendations are reviewed by more senior OMB officials, culminating in review and approval by the OMB Director and the President. Agencies are notified of the President's decisions through a process known as "passback." During passback, OMB officials notify agencies of their approved budgetary levels, which may differ from the agencies' budget requests. The passback process and the content of passback decisions has differed under each Administration and each OMB Director. For example, passback decisions may also include program policy changes or personnel ceilings. Agencies may appeal these decisions to the OMB Director, or in some cases, to the President directly, depending on the procedures established by the OMB Director. The President's budget submission is a multi-volume set of documents, which may vary in size and composition from Administration to Administration. This section briefly discusses the components of the President's budget submission to Congress, and highlights some of the formal and informal interactions between Congress, the President, OMB, and agencies. Under 31 U.S.C. Section 1105, the President is required to provide certain information in the budget submission to Congress. The complete list of content the President is required to submit as part of the budget proposal is extensive, and includes (1) estimated receipts, expenditures, and proposed appropriations for the next five fiscal years; (2) actual receipts, expenditures, and appropriations for the previous fiscal year; (3) information on the public debt; and (4) separate statements of amounts for specified appropriations accounts and trust funds, among other things. The budget submissions of the past three Presidents have each included the following volumes: Budget of the U.S. Government —includes a short budget message summarizing the President's policy priorities, summary tables of budgetary aggregates, and a detailed narrative description of proposed government activities, organized by issue and agency; Historical Tables —provides a historical overview of federal government finances, including time series statistics on budget authority, government receipts, outlays, government employment, gross domestic product (GDP), and the federal debt going back several decades and in some cases as far back as 1789; Analytical Perspectives —contains in-depth analysis of government programs, including credit and insurance programs, discussion of crosscut budgets that span two or more agencies, and technical explanation of the budget baselines used in the analyses and estimates contained in the President's budget proposal; and Appendix —includes detailed budget estimates and financial information on individual programs and appropriations accounts, proposed text of appropriations language, and information on the legislative and judicial branch appropriations that are not included in other volumes of the President's budget proposal. Presidents have also included supplemental materials, such as legislative proposals for budget process reform, a brief guide to the budget that is intended for members of the public, or a summary of proposed spending reductions or program consolidations. The President may also update the budget by submitting supplemental requests and revisions to Congress. Under current law, the President is required to submit a supplemental summary of the budget, commonly referred to as the Mid-Session Review (MSR), before July 16 of each year. The MSR is required to include any substantial changes in estimates of expenditures, receipts, or substantial changes to obligations plus any changes in outlays or budget authority requested. The MSR may reflect changes in economic conditions, budgetary actions taken by Congress, or other factors that have led the President to make adjustments to the initial budget submission. Once the President has submitted the budget, OMB and agency officials explain and justify the request to Congress. This frequently involves both formal and informal interactions. Early in the congressional budget process, often in the week following the submission of the President's budget, the OMB Director and other Cabinet officials usually provide testimony regarding the President's broad budgetary objectives before congressional committees. For example, in February of 2012, acting OMB Director Jeffrey Zients and Treasury Secretary Timothy Geithner each testified before the House and Senate Budget Committees. Agencies also submit written justification of their budget requests to the appropriations committee and subcommittees of jurisdiction in each chamber. As budgetary legislation is being formulated by Congress, agency officials are often called before the appropriations subcommittees to justify and explain their budget requests to Congress. To ensure that all testimony and written justification materials are consistent with the President's policy objectives, OMB may review materials before agencies provide them to Congress. Agency testimony and written justification materials facilitate dialogue and information sharing between federal agencies and congressional committees. Justification materials are often the starting point for language contained in the committee reports that accompany each appropriations bill.