Agency Restructuring of Programs, Activities and Appropriations
These instructions are intended to provide additional information to assist agencies in
preparing for the 2014-15 biennial budget. Agencies should immediately begin the
process of reviewing existing budget structures to identify any changes they may want
to make in the biennial budget presentation.
Why is this important now?
Changes must be made in SWIFT prior to FY 2012 close so that agency budget structures
are as intended when they are loaded into BPAS. By identifying a future effective date in
SWIFT, agencies may work now to identify future structure changes, without impacting
their budget structure in SWIFT for FY 2012 or FY 2013.
Agencies will not have the ability to change their own budget structures in the budget
system. These changes will need to be made centrally. The more changes the agencies
will be able to identify before the load to BPAS, the less chance of delays during the
crunch time between fiscal year close (August 17) and when Agency’s base budgets are
statutorily required to be complete (October 15).
What is an Agency’s budget structure?
An agency's budget structure is an inventory of all the programs and activities
undertaken by an agency or public entity. The budget structure groups together related
areas of work and links them logically to the organization's strategic outcomes and
goals. It provides a framework — a map — by which planned resource allocations,
expected results, and performance measures are linked to each activity. The budget
structure sits above and may be different and separate from an agency’s organizational
structure as represented by districts, regions, divisions, or work units.
How is budget structure used?
Agency budget books, narratives and fiscal pages, are organized around an agency’s
budget structure as established in SWIFT. MMB policy requires each agency to use a
budget structure to define how it plans and manages its work, allocates resources, and
achieves and reports on results. It serves as an important tool, used by the governor and
legislature in making decisions about allocating resources and in measuring agency
success in achieving goals and outcomes.
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Why would an agency want to change its budget structure?
Agencies are encouraged to carefully evaluate their current budget structure for
alignment with the following definition of programs and budget activities. Agencies with
budget structures that do not conform to this definition should consider revising their
budget structure as described later in this document.
For many agencies, the budget structure is used solely to present budget information in
the biennial budget document once every two years. During the next biennial budget, it
is expected that the budget structure will serve as a framework for reporting agency
progress toward outcomes, strategic goals and performance measures. In the future,
budget information in BPAS will be loaded back into SWIFT, further requiring the
structures in the two systems to align.
How is a budget structure used to communicate performance information?
A budget structure organized around strategic goals (programs) and clearly defined
functions that achieve those goals (budget activities), which link to performance
measures that indicate activities’ progress toward meeting those program goals, will
allow agencies to describe how state spending achieves important outcomes for
citizens.
For agencies without existing or substantive performance measures, creating a
meaningful budget structure will highlight the core services and deliverables for your
agency, allowing easier identification of outcomes and measures, either in the short
term or in the long term.
Within this context, MMB encourages agencies to review and develop a budget
structure that focuses on providing accountability for the use of state resources—both
in budget preparation and everyday expenditure management. The following section
provides guidance to agencies considering changes to their budget structures in order to
improve regular management and reporting of agency progress toward strategic goals
and performance measures.
What are the suggested criteria for creating a budget structure?

Describe value received for state spending – provides sufficient information to
convey what services are provided, at what cost, and with what results.

Help decision-makers judge relative value of state activities – provides sufficient
information for all stakeholders in the budget process (legislature, governor, media,
public) to prioritize state spending and determine appropriate tradeoffs when
allocating scarce resources.
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What does a budget structure look like in general? How does it compare to
how budget controls are set?
Agencies must define at least one program comprised of one or more budget activities.
Each program should contribute to the achievement of a strategic outcome or goal
within the agency’s mission.
The budget activities within each program should be causally linked to producing a
primary expected result of the program. Budget activities are intended to represent
discrete tasks performed by an agency to support the goals and outcomes of a program.
Budget activities contain at least one appropriation and are not intended to represent
legal level of budgetary control, but rather to inform decision-makers about the
component parts of a program’s function. For this reason, MMB expects the legislature
to continue making appropriations at their current levels within the budget structure.
AGENCY
PROGRAM
Key services & outcomes within an agency’s mission
BUDGET ACTIVITY/ACTIVITIES
Description of what is produced/accomplished to deliver
key services or achieve outcomes within a program
APPROPRIATION(S)
Legal level of budget authority
How are each of these components defined?

Program: A program identifies key services and outcomes produced by an agency.
Programs should represent major and distinct divisions of an agency’s mission rather
than just how an agency is organized administratively. Programs may be
differentiated by client groups, business functions, or policy objectives. Each
program should contain one or more budget activities.
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Example: Agency:
Programs:

Minnesota Management & Budget
Statewide Services, Insurance Programs
Budget Activity: A budget activity is something an agency does to accomplish the
goals and objectives of a given program. It describes a distinct element of an
agency’s work, what it produces or accomplishes, and how it makes a difference.
Activities provide a product or service for customers that lead to results those
customers want. An activity may be differentiated by service delivery strategies
related to the program.
Example: Agency:
Program:
Activities:

Minnesota Management & Budget
Statewide Services
Accounting Services, Budget Services,
Economic Analysis, Information Systems,
Treasury, Management Analysis &
Development, Human Resource
Management, Labor Relations, Agency
Administration
Appropriation: Legally authorized dollars granted to an agency by the Legislature
through law or statue for a specific purpose.
What should an agency consider when defining its budget activities?
Budget activities should break down the work of an agency into discrete functions or
lines of business. An agency should have enough activities to describe each program
thoroughly; however not so many that it becomes difficult to understand the overall
agency function. Consider these questions when defining budget activities for your
agency or program:




How would you break down your agency or program’s activities to describe:
o What do you do?
o For whom?
o What does it accomplish?
To determine whether something qualifies as a discrete activity, consider
o Does the activity serve a common type of customers?
o Does the activity rely on a common set of tools to carry it out?
o Does the activity use a common approach or business function to deliver its
results?
Is it clear what each activity does and how each activity relates to the agency
mission and the results of the program area?
How is performance measured for each activity?
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
Would the list of activities make sense the public? Taken together, does the list of
activities represent an accurate, complete view of the agency or program’s major
lines of business?
What common mistakes are made when defining budget activities?



Creating multiple activities that are not sufficiently differentiated.
Combining dissimilar functions into one large activity. Activities should not have
widely different customers, functions, and processes.
Creating an activity structure that mirrors the organizational structure rather than
the agency’s primary functions that achieve elements of its mission.
How does an agency make budget structure changes?
Executive budget officers are currently working with agencies to clean up program and
activity descriptions in SWIFT. In addition to ensuring that descriptions are clear and
understandable for budget page purposes, agencies should also take this opportunity to
carefully re-examine the current budget structure to improve its use in making decisions
about allocating resources and in measuring agency success toward achieving strategic
goals and outcomes.
Agencies interested in modifying the budget structure should notify their EBO as soon as
possible. Before implementing a new budget structure, agencies should consult and
gain concurrence on the structure from their EBO and legislative staff.
Budget structure changes must be made in SWIFT prior to FY 2012 close, August 17, so
that BPAS is loaded accurately for the 2014-2015 biennial budget. Any changes after the
initial load of information from SWIFT into BPAS must be handled centrally by MMB.
This is a change from BBS, in which an agency could make structure changes directly in
the system.
If agencies want to make changes to their budget structure for the 2014-2015 biennial
budget, but do not want to change the structure in SWIFT for FY 2013, they may
effective date the changes in SWIFT so that the changes do not go into effect until FY
2014.
Agencies should submit changes to their EBO and Agency Assistance using the attached
form.
How can an agency review its budget structure?
The budget structure is available in spreadsheets that EBO’s have shared with agencies
for the purpose of clarifying descriptions of programs and budget activities. The
structure will also be available in the new budget system both in training classes and at
users’ desks once training begins.
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