Budget Process

The Budget Process page explains how Idaho’s budget is developed, reviewed, and approved, including the roles of the Governor, Legislature, and agencies.

Budget Development Process

Within the Division of Financial Management (DFM), the Budget Bureau is responsible for budget development. Budget development is a continual process throughout the year. It involves the legislative and executive branches with occasional counsel from the judicial branch. The following chart indicates the participants in the budget process.

Budget Development Manual The Budget Development Manual (BDM) is annually prepared through a joint effort of the Legislative Services Office (LSO) and the Governor’s Division of Financial Management (DFM). This manual provides guidance on budget submittal procedures including detailed information on projected benefit increases, what information needs to be provided, and guidance on how to submit the required data. “The manual provides guidance on budget submittal procedures. This guidance includes detailed information on projected benefit increases, the percentage increase to be used for operating expense inflation, medical inflation, and Change in Employee Compensation (CEC).” July State Agencies Develop Budget Agencies develop their budget requests based on provided guidance and agency needs. July-Aug Agencies Submit Budget On or before September 1st agencies submit their budgets simultaneously to DFM and LSO. These analysts work with the agencies to correct any technical issues in the submission. The final product is the Agency Budget Request. Sept 1 Legislature Development of Legislative Budget Book After submission, the Legislative Services Office analysts prepare their reports and recommendations for presentation to the Joint Finance-Appropriations Committee in the Legislative Budget Book (LBB). Sept - Dec Budget Hearing process for JFAC After the Governor presents his budget recommendation, the Joint Finance-Appropriations Committee (JFAC) begins hearing testimony on agency budget requests and the Governor’s recommendation. During this process, the committee members have the opportunity to ask clarifying questions and make comments. Jan - Feb Budget Setting Process by JFAC After an agency’s presentation has been heard the budget-setting process begins. JFAC members create smaller working groups to thoroughly evaluate the information presented. These working groups then formulate motions (proposals on what they think should be in the budgets). These motions are voted on in the full committee meeting. Feb - Mar Appropriation Bill to Floor The motion that passes in JFAC is then turned into an appropriation bill (legislation granting legal authority to spend money for specific purposes) to be sent for passage through both the House and the Senate. These bills must pass both the House and the Senate and then be signed by the Governor. Once signed these bills are law. Feb - Mar House Bills whose motions were initiated by a House Representative start in the House for debate and approval. These are then sent to the Senate for debate and approval. Senate Bills whose motions were initiated by a Senator start in the Senate for debate and approval. These are then sent to the House for debate and approval. Governors Office Development Executive Budget Recommendation After submission, the Governor’s DFM analysts meet with the Governor to present the agencies’ requests and introduce options. The Governor then completes his recommendation. Sept - Dec Presentation of Executive Budget to Legislature The Governor presents his recommendations to the Legislature during the first day of the Legislative Session which begins in early January. Jan - Feb (If Vetoed) Governor Once a bill has passed in both the House and Senate it is sent to the Governor for approval. He may either sign the bill and the appropriation becomes law or veto the bill. (If the bill does not pass both the House and Senate or if it is vetoed by the Governor the process must begin again with a new bill.) (If Signed) Becomes Law Once a bill is passed by both chambers and is signed by the governor it is law. Budget Execution Agencies now know what their budgets will be for the upcoming fiscal year and can plan accordingly. On July 1 (the first day of the new State fiscal year) budgets are in effect. Feb - Mar Adjustment to Budget Adjustments to budgets are ongoing throughout the year. The Legislature considers adjustments to the current year’s budget through supplementals at the beginning of the budget-setting process. DFM budget analysts monitor how spending is going throughout the year. The Governor can make budget adjustments such as holdbacks at any point in a year when revenues are not meeting projections. DFM analysts are authorized by the Board of Examiners to allow agencies to make budget transfers mid-year and to allow for the inclusion of federal grants, etc., that were unknown at the time of budget-setting through a non- cognizable funds process (as authorized by Idaho Code §67-3516(2)).

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