PM-3: Information Security and Privacy Resources

Quick-reference card

What this control requires

PM-03 requires your organization to embed information security and privacy funding into its capital planning and investment process, so that security programs receive dedicated, trackable budget allocations rather than competing for leftover funds. You must document any exceptions where security and privacy resources aren’t included in investment requests, and you must prepare that documentation in line with applicable laws, directives, and regulations.

In practice, this control addresses a structural problem that many organizations face. Security teams often operate without a formalized claim on budget cycles, which means their resource needs get deprioritized during capital planning reviews. PM-03 closes that gap by requiring organizations to treat security and privacy spending as a formal line item in investment requests, including artifacts like Exhibit 300 and Exhibit 53 submissions used in federal capital planning.

The control also requires that planned resources actually reach the teams that need them. Documenting a budget request isn’t enough if the funds are later redirected or delayed. Your organization must make approved security and privacy resources available for expenditure as planned, creating accountability between what’s budgeted and what’s spent. This requirement applies across the full NIST SP 800-53 control catalog’s Program Management family, reinforcing the principle that security programs need sustained, predictable investment to function.

Why it matters

Failure to maintain PM-03 introduces audit risk and may result in certification withdrawal or regulatory findings. When security and privacy resources aren’t formally embedded in capital planning, auditors flag the gap as a systemic governance weakness, not an isolated oversight. For organizations subject to federal requirements, missing Exhibit 300 or Exhibit 53 documentation can trigger compliance findings during OMB reviews.

Without dedicated budget allocations, security programs lose their ability to plan proactively. Teams default to reactive, ad hoc spending that can’t sustain ongoing monitoring, staffing, or tooling needs. The downstream effect is a widening gap between your documented security program plan and your organization’s actual security posture.

Organizations that skip PM-03 also struggle to justify security investments to leadership. When security spending isn’t tracked through the same capital planning process as other business functions, it becomes harder to demonstrate return on investment or to advocate for additional resources during budget cycles. That erosion of visibility often leads to chronic underfunding, which compounds risk across every other control family.

Where this control breaks down, the consequences rarely appear as a single dramatic failure. Instead, underfunded security programs gradually lose the capacity to implement controls effectively, creating a slow accumulation of risk that surfaces during audits or incidents.

Auditors treat PM-03 failures as evidence of a broader governance deficiency. A missing Exhibit 300 entry or an undocumented exception doesn’t just result in a single finding; it raises questions about whether the organization’s entire security program has the institutional support it needs. For federal agencies, this can escalate to OMB intervention or congressional oversight inquiries.

How to implement

For your organization

The core challenge with PM-03 is integrating security and privacy into a capital planning process that wasn’t originally designed to accommodate them. Most organizations have well-established investment review workflows for IT infrastructure or business applications, but security spending often sits outside those workflows. Your first step is to map your organization’s existing capital planning cycle and identify where security and privacy resource requests should be inserted.

Step 1: Inventory your security and privacy program resource needs. Document the staffing, tooling, training, and operational costs required to run your information security and privacy programs. Align these needs with specific controls and program objectives so each budget request traces back to a documented requirement.

Step 2: Prepare capital planning documentation. Create or update Exhibit 300 and Exhibit 53 submissions (or your organization’s equivalent investment request artifacts) to include security and privacy line items. Each submission should reference the applicable laws, executive orders, directives, and standards that mandate these investments.

Step 3: Document exceptions. If any security or privacy resource need can’t be included in a capital planning request, document the exception formally. Record the reason, the associated risk implications, and any compensating measures in place. Maintain an exceptions log that auditors can review.

Step 4: Establish an Investment Review Board or equivalent oversight body. Designate a group with the authority to review, prioritize, and approve security and privacy investments alongside other capital requests. This board should include stakeholders from security, privacy, finance, and executive leadership.

Step 5: Track expenditure against plans. Once resources are approved, monitor whether the planned funds are actually made available and spent as intended. A common failure is budget approval followed by reallocation, so you need a reconciliation process that compares planned versus actual expenditures each quarter.

Step 6: Assign accountability. Designate information security and privacy champions within the capital planning process. These individuals ensure that security resource requests aren’t dropped or deprioritized during review cycles.

Common tooling categories: governance, risk, and compliance (GRC) platforms for tracking investment requests and exceptions; financial management systems for reconciling planned versus actual expenditures; project portfolio management tools for aligning security investments with program milestones.

Common mistakes to avoid: treating PM-03 as a one-time documentation exercise rather than an ongoing process, failing to update resource requests as program needs change, not tracking whether approved budgets are actually disbursed, and omitting privacy program resources from capital planning submissions when only information security is addressed.

Evidence examples

Cross-framework mapping

Related controls

• PM-04 — Plan of Action and Milestones Process: PM-04 tracks remediation of identified weaknesses within the Program Management family, which depends on the resources PM-03 ensures are budgeted and available.
• SA-02 — Allocation of Resources: SA-02 focuses on determining and allocating resources needed for specific system security requirements, while PM-03 ensures those allocations flow through the capital planning process.

Frequently asked questions

What is NIST SP 800-53 PM-03

PM-03 requires organizations to include information security and privacy resource needs in their capital planning and investment requests, document exceptions, and ensure approved funds are made available for expenditure. The control targets the gap between security program requirements and actual budget allocations by embedding security spending into formal investment workflows like Exhibit 300 and Exhibit 53 submissions. It falls within the Program Management family and applies to the PRIVACY baseline.

What happens if PM-03 is not implemented

Without PM-03, your organization risks audit findings for failing to integrate security and privacy resources into capital planning documentation. Auditors expect to see Exhibit 300 and Exhibit 53 submissions that include security line items, and missing documentation signals a systemic governance gap. Over time, the absence of formalized budget processes leads to chronic underfunding of security programs, reducing your ability to implement and maintain other NIST SP 800-53 controls effectively.

How do you audit PM-03

Auditing PM-03 starts with reviewing capital planning submissions for security and privacy resource line items, including Exhibit 300 and Exhibit 53 filings. You then verify that an exceptions log exists for any resource needs excluded from investment requests, and that each exception includes a documented justification. Auditors also check whether an Investment Review Board or equivalent body is designated with oversight authority, and whether quarterly reconciliation records confirm that approved budgets were actually disbursed as planned.

What is the difference between PM-03 and SA-02

PM-03 governs the inclusion of security and privacy resources in your organization’s capital planning and investment process, ensuring budget requests follow formal documentation requirements like Exhibit 300 submissions. SA-02, by contrast, focuses on determining the specific resources needed to protect individual systems and allocating those resources during system development. PM-03 operates at the program level across your entire organization, while SA-02 operates at the system level during the system development life cycle.