ABCs of Budgeting

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ABCs of Budgeting

• BUDGET PREPARATION

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What is a Budget

• An itemized summary of expenditures
• Total sum of money allocated to your department
• A statement of the financial position of a
  department/organization
• A plan for spending money for the designated
  period
• Useful for projecting future expenditures

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Characteristics of a Budget

• A well thought out plan
• Detailed
• Contains estimated expenditures
• Includes appropriate subtotals and totals
• Concerning a defined length of time
• Explanation of activities

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Working Definition

• A budget is the plan for your department. It
  contains detailed itemized estimates of all
  expenditures and contributions from all sources
• AND
• Also a budget includes the amount and
  distribution of funds needed to perform the
• project activities over the fiscal year.

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Types of Budget Concepts

• Line Item
• Continuation
• Performance
• Planning
• Management By Objective (MBO)
• ZBB (Zero Based Budgeting)

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EXAMPLE OF BUDGET

• KEY COMPONENTS
• Salary and Fringe Benefits
• Operational
• Capital

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2011 General Fund Operating Expenditures
Total 432,956,364
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2011General Fund Revenue Budget
Total - 440,926,537
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BUDGET PREPARATION

• S W O T ANALYSIS
• Strengths
• Weaknesses
• Opportunities
• Threats

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BUDGET PREPARATION

• WHAT ARE YOUR STRENGTHS?
• WHAT ARE YOUR WEAKNESSES?

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BUDGET PREPARATION

• WHAT ARE OPPORTUNITIES THAT ARE VIABLE AND
  POSSIBLE TO IMPLEMENT?
• Are those opportunities realistic?
• Are they cost effective
• Are they attainable?
• Short term
• Long term
• IF THERE IS A CHANGE WILL IT BECOME A THREAT TO
  PERFORMING MANDATED FUNCTIONS IN YOUR OFFICE?
• Be Proactive in minimizing potential threats to
  changes that may occur
• Change potential threats into an opportunity to
  explore new opportunities for providing a
  service delivery

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HOW DO YOU PREPARE YOUR BUDGETS

• Largest line item is Personnel
• Review every position and job functions
• Understand why your office is doing what it is
  doing
• Operations
• Determine if you can cut costs by doing something
  more efficient

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HOW DO YOU PREPARE YOUR BUDGETS

• Project your expenditures for the year based on
  the year to date total
• Was there an activity performed that will not be
  done in the upcoming year?
• Example
• cut down on publishing and printing a management
  book mainly used for internal purposes. Place it
  online for accessibility
• Capital
• Is this expense necessary to adequately perform
  job functions
• Understand why your office is doing what it is
  doing

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FY 2011 CHALLENGES

• Property taxes collected down
• Assessments for commercial taxes are down
• Fines and Fees collected down
• Potential Health Benefits increase
• Potential decrease in State funding for grants
• Quality of Services jeopardized (asking staff to
  do more with less)
• No Merit Increase for Staff for the 4th year
• Hiring Freeze in Place for the last 2 years
• Unfunded Mandates verses Funded Mandates

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EFFICIENCIES

• Question cutting a budget line item
• Does making the change make your service delivery
  more efficient?
• Does an increase in the use of technology equate
  to less personnel and decrease in operational
  expenses?
• E-filing
• Paperless Systems
• Digital Courts (long term)

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2012 Budget Resolution
Revenue
Expenses
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APPROACH FOR FUTURE

• TO ACCOMPLISH THE MISSION OF YOUR
  DEPARTMENT/ORGANIZATION
• Changed
• Modified, and/or
• Redirected
• BECOME A SOUND FISCAL AND PROACTIVE AGENT
• OF CHANGE FOR THE CITIZENS YOU REPRESENT
• AND SERVE

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Comments/Questions