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What does Budget Authority mean in Project Management?

by | reviewed 2023-08-19
Budget Authority
Budget authority refers to the legal authority granted to federal agencies by Congress to enter into financial obligations that will result in immediate or future outlays of government funds. In other words, it represents the amount of money that an agency is authorized to spend or commit to spending for specific programs, projects, or activities during a specified period of time, typically a fiscal year.


Budget authority can be provided through various means, including appropriations acts, which are laws passed by Congress to fund specific government programs or agencies, as well as through authorizing legislation, which creates or continues the operation of a federal program or agency and sets forth the guidelines for its funding. Budget authority can be classified into several categories, such as:
  • New budget authority: Funds provided by Congress for the current fiscal year.
  • Unobligated balances: Funds that were provided in prior years but have not yet been obligated.
  • Borrowing authority: Permission granted to an agency to borrow funds and incur debt, usually to be repaid from future appropriations.
  • Contract authority: Permission to enter into contracts or other binding agreements in advance of appropriations.
  • Spending authority from offsetting collections: Permission to spend offsetting collections, which are fees, charges, or other collections that offset the cost of a program.
Budget authority is an essential component of the federal budget process, as it determines the level of resources that agencies have at their disposal to carry out their missions and achieve their goals.
See also Budget
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