The Bureau of the Budget was established by Act 56, SLH, in 1925.
In 1925, the Governor and the Legislature recognized the need to establish a personnel classification system and a standard salary schedule for the territorial civil service. The personnel classification system would define classes of occupations, list the skills required for levels within each class, and establish comparability among classes to ensure that equally demanding jobs received equal pay. The standard salary schedule would provide ranges of pay with a hiring rate and a maximum rate. The classification system and the salary schedules would help eliminate favoritism and nepotism within the civil service by providing for competitive appointment to jobs. Since the Legislature was unable to agree on a process for establishing the system, in 1927, the Governor directed the Bureau of the Budget to prepare and administer to territorial employees a questionnaire that would produce data for the development of a personnel classification system for the territorial civil service.
In 1929, the Bureau of the Budget published, “Report of the Director of the Bureau of the Budget on the Classification of Personnel,” using data from the surveys. In 1933, the Bureau published a similar report, this time using data collected by the Bureau of Governmental Research.
In 1933, the Supplies Division of the Bureau was established by Act 148. In 1941, the chairmanship of the Board of Disposal was transferred to the Director of the Bureau of the Budget by Act 127, from the Territorial Auditor. Act 264, SLH 1951, transferred functions of the Insurance Commissioner concerning risk to territorial property to the department.
Act 1, SLH 1959, Second Special Session, transferred the functions of the Bureau of the Budget to the Department of Budget and Review, but excluded insurance management, surplus property management [Board of Disposal] and central purchasing functions [Supplies Division], which were transferred to the Department of Accounting and General Services.