Zero-based budgeting

(a) Interim period Section 1105 of title 31, United States Code, is amended by adding at the end the following: (j) (1) Except as provided in paragraph (2), the President shall submit with materials related to each budget transmitted under subsection (a) on or after the date of enactment of this subsection a budget for each department and agency that contains the following information: (A) A description of each activity for which the department or agency receives an appropriation in the current fiscal year or for which the department or agency requests an appropriation for the budget year. (B) The legal basis for each activity described in subparagraph (A). (C) For each activity described in subparagraph (A)— (i) an examination of the objectives, operations, and costs of the activity; (ii) three alternative funding levels for the budget year, not fewer than 2 of which shall be below the funding level for the current fiscal year; (iii) a summary of the priorities that would be accomplished within each level described in clause (ii); and (iv) the additional increments of value that would be added by the higher funding levels described in clause (ii). (D) For each activity described in subparagraph (A), 1 or more measures of cost efficiency and effectiveness. (2) The materials submitted under paragraph (1) shall not include information for the old-age, survivors, and disability insurance benefits program under title II of the Social Security Act (42 U.S.C. 401 et seq.), the Medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.), or the Medicaid program under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.). (3) As soon as practicable after the date of enactment of this subsection, the Director of the Office of Management and Budget shall publish guidelines to carry out this subsection, which shall require that the baseline budget of each department or agency is assumed to be zero and each proposed expenditure shall be justified as if it were a new expenditure.. (b) Biennial zero-Based budgeting (1) In general Effective on January 1, 2027, subsection (j)(1) of section 1105 of title 31, United States Code, is amended by striking Except as provided and all that follows and inserting the following: “Except as provided in paragraph (2), the President shall submit with materials related to each budget transmitted under subsection (a) on or after December 31, 2026, a budget for each department and agency that contains the following information: (A) A description of each activity for which the department or agency receives an appropriation in the either fiscal year of the current biennium or for which the department or agency requests an appropriation for either fiscal year in the next biennium. (B) The legal basis for each activity described in subparagraph (A). (C) For each activity described in subparagraph (A)— (i) an examination of the objectives, operations, and costs of the activity; (ii) three alternative funding levels for each fiscal year in the next biennium, not fewer than 2 of which shall be below the funding level for the average of the amount for each fiscal year during the current biennium; (iii) a summary of the priorities that would be accomplished within each level described in clause (ii); and (iv) the additional increments of value that would be added by the higher funding levels described in clause (ii). (D) For each activity described in subparagraph (A), 1 or more measures of cost efficiency and effectiveness.. (2) Applicability The amendment made by this subsection shall apply to budget recommendations for the biennium beginning with fiscal year 2028, and each biennium thereafter.