In 1967 the Washington State Legislature amended Title 35 of the Revised Code of Washington to give the executive branch of government, in cities with population over 300,000, the responsibility for budget preparation and execution. Prior to this, these powers were vested in the legislative branch. Pursuant to this legislation, the City of Seattle created the Budget Office as a part of the Executive Department.

In May 1971, the office was expanded in scope and responsibility and retitled the Office of Management and Budget (OMB). The creation of OMB represented an attempt by the Mayor to establish a separate professional organization to allocate and oversee the management of City resources. The agency was organized into four areas of responsibility: program budget, revenue estimating and analysis, grants management and management systems.

The office served in this capacity until 1995, when it was merged with the Planning Department to become the Office of Management and Planning (OMP). In early 1998, the Mayor divided the OMP , with the budget function going into the newly-formed City Budget Office (CBO), located in the Executive Services Department. After a 2001 reorganization, the newly created Department of Finance (DOF) directed the city budgeting process. In May 2002, the existing DOF was reorganized to create two separate departments: Department of Finance and Department of Executive Administration. DOF focused closely on financial management and was responsible for budget development and monitoring.