Budget Change Proposal

A Budget Change Proposal (BCP) is a formal document that is required when an office has a need for additional resources or a reduction in resources to change the level of service or funding for activities authorized by the Legislature, or to propose new program activities not currently authorized.

Policy

None

Procedure

Budget Change Proposals (BCPs) are a critical part of the annual budget process and preparation begins at least 18 months prior to the beginning of the effective budget year (i.e., January 2002 for the 2003-2004 fiscal year). Although current year requests (deficiencies) may be submitted, they are restricted to issues of an emergency or critical nature. The following outlines the BCP review and approval process:

Offices

Office staff, in conjunction with the Office of Fiscal Services (OFS) Budgeting and Planning Section (B&PS) staff, develop documented support for all BCPs to be presented at the annual Financial/Business Plan (Plan) departmental hearings held in June of each year. A written analysis of each BCP, including a recommendation to the DGS Executive Management Team, is prepared by the B&PS and included in the Plan.

DGS Executive Management Team (Team) 

The BCP is discussed at the hearing and the Team denies or approves the BCP for submittal to the State and Consumer Services Agency for inclusion in the Governor's Budget. If approved, the originating Office and B&PS staff prepare a formal BCP.

Business, Consumer Services & Housing Agency (Agency)

The B&PS compiles all DGS approved BCPs into a package for submission to Agency during August of each year. Departmental/Agency hearings are held in early September to discuss the BCPs.

Department of Finance (DOF)

The B&PS compiles all Agency approved BCPs into a package for submittal to the DOF during September. Agency/DOF hearings are held in September/October to determine which BCPs will be included in the Governor's Budget. If a disagreement exists between Agency and the DOF, the BCPs will go to the Governor's Office for a final determination. Approved BCPs will be included in the Governor's Budget released on January 10th.

Legislature

The B&PS compiles all Administration approved BCPs in a package for submittal to various legislative committees and to the Legislative Analyst's Office (LAO) at release of the Governor's Budget in January. The LAO presents its Analysis of the Budget Bill (Governor's Budget) to the Legislature. The Analysis usually raises issues of concern with a department's budget (including proposed BCPs). Departmental budgets are heard by the Legislature in committee hearings beginning in February. Department and DOF staff testify during the subcommittee hearings, along with LAO staff. The Legislature makes their decision and presents its Budget Bill to the Governor for signature in June.

Preparation of a BCP

A formal BCP must include documentation and justification to support the additional resources or a reduction in resources. The BCP format is prescribed by the DOF and consists of the following components:

  • Fiscal Detail Sheets
  • Nature of Request
  • Background/History
  • State Level Considerations
  • Justification
  • Analysis of All Feasible Alternatives
  • Timetable
  • Recommendation

See Department of Finance guidelines on “How to Write an Effective Budget Change Proposal.”

Questions regarding the BCP process should be addressed to your Budget Analyst.