As a County
Commissioner, probably the largest responsibility I have to the citizens is
oversight in the creation of the budget followed by its faithful
implementation.
You may have heard
from some that I am critical about the County Budget. No so. Not critical about
the Budget itself as much as I am critical of the way the budget is built.
I am merely on a
Quest for Transparent Budget Builds.
The dollars and
percentages within the county budget presentations are consistent with previous
budgets, and unless the staff takes an altered course, you can as easily as I,
predict future budgets.
We simply take last
year and build upon it.
It is not the dollars
though many know my philosophy is one where I believe we should have a “lean
government” with “reduced taxes” and more efficient processes.
Some claim we have a
“lean government” and I’ve asked to see the data they used to make such a claim
so I may also conclude just how lean we are. I’ve heard a counter statement
that it’s based upon years of experience. I’m still awaiting that data.
Some claim our budget is
testimony to the county bond ratings; distinguish budget presentation awards,
and awards for accounting.
Bond ratings are essentially
credit scores indicating our ability and willingness to pay our debts more so
than reflecting the quality of the budget.
Presentation awards reflect a document that serves as an operations guide, financial
plan, and communications device; less so about the quality of the budget.
Accounting awards indicate we
properly document expenditures consistent with the budget demonstrating that
funds are “accounted for”, not the quality of the budget.
These awards are welcomed,
earned, noteworthy, and clearly deserving for our staff; yet even in total do
not mean we have the proper budget.
My issue, when I’ve
spoken critically about the budget, had little to do with the specifics
contained within the specific documented budget. My concerns centered on the
approach we take to build the budget.
The current approach is what one may call a “Baseline”
approach. This approach entails taking a
previous year’s budget and aligning anticipated expenses to projected income.
It allows for elected officials to see dollar figure projections for income and
projections for expenses.
That Baseline approach is the same used by congress in
Washington D.C. when they create the national level budget of overspending and
deficits. That’s also the type of budget where projected rates of spending are
reduced are so called cuts. We know these do not represent real cuts in
spending.
I argue that our current Baseline budgeting prevents the
level of detailed examination needed by elected officials.
Just like the Feds, we simply
take last year and build upon it. That means some good programs are ensured to
continue, but also means some things we ought not to do continue as well. How
can the citizen know what should be or should not be included?
The current approach prevents the level of transparency our
citizens deserve.
I contend that budgets are not about Dollars and Personnel
Positions, nor Governmental Organization Structure. I contend budgets are about
Priorities, Transparency, and Citizen Involvement.
I call for a
different approach on how the budget is built. It’s not so much “Zero-Based
Budgeting” as much as it is a transparent means of building the budget.
First, I oppose budgets where I cannot readily see rationale
explaining 1. Why we need the number of requested employees, 2. Why we need the
identified amount of income (taxes), and 3. Why we need the identified
resources such as buildings and equipment.
I disagree that we produce a
“conservative budget.” I do understand we error on the side of the tax payer
when making estimates which as described in bond rating agency reports, is
consistent with conservative budgeting practices.
A conservative budget is more
than making conservative estimates. It starts with the basics by documenting citizen
needs and identifying required Functions and Services to satisfy those needs. Conservative
budgets ensure that only required functions and services are funded. I support building a budget from the
basics.
We should articulate genuine
guidance at the beginning of the build. Instead, departments are instructed to
perform “salami-slicing” to reach the budget bottom line (now for a fourth year
in a row).
This “salami-slicing” can actually hurt needed services while
protecting less critical services. To me, taking a salami-slice approach is not
so much a problem as it is a symptom of a problem.
The current process lacks
detailed prioritizations. When you hear elected officials say everything is a
priority, then nothing is a priority. We should have greater front-end insight
to more objectively determine what specific items should, or not, be funded.
We should seek ways of
reducing duplicative costs to include the Sheriff’s Office and Board of
Education. We should focus on cost savings for the tax payer by targeting
similar functions and services across the entire county government such as procurement
and IT services. In fleet
maintenance, we might find as much as 25% savings in maintenance if we take a
different approach.
Citizens ask why educators
request more money while declining student enrollment since 2006, continues
downward through 2016.
The State Office of Legislative Audits conducts audit
to evaluate the effectiveness and efficiency of the financial management
practices of the Calvert County Public Schools (CCPS).
In 2009, the
audit made 19 recommendations to enhance controls in existing financial
management systems and processes in areas such as procurement,
payroll, and student transportation. For example, “CCPS needs to enhance
certain procurement policies and procedures and should institute better security
controls over its payroll and disbursement automated systems.”
They identified
bus transportation vendor reimbursement rates that should be reevaluated, as they “appear
to result in unnecessarily high reimbursements, which could cost CCPS
approximately $4.2 million over the life of the new buses put into service since
1998.”
I mention this as I believe we should see what the
school system has done to address those 19 recommendations before simply
sending over more of your money for them to simply do more of the same.
Notice, I did not mention the more volatile issue of
teacher salary increases, but does it not stand to reason that greater
efficiencies as recommended by the audit should leave more funds to support the
teachers?
One citizen’s look at the
school budget questions less than explicit expenditures of over half-million
dollars, and if $6.6 million is really appropriate for custodial support.
Hiring more deputies and
staff over the past years means less money for salary increases.
I am not critical of past budgets as they were done with the
best information available at that time. During economic expansion, the process
created reserves that assisted during economic contraction. Given the prolonged
stagnant economy, is it not appropriate to consider relooking our build
process?
We need a different process;
one with goals of reducing tax rates, identifying and eliminating duplication,
ensuring greater transparency for the citizens, and increased interaction by
your elected officials throughout the entire build.
I call for a Basis of Estimate for each of the positions. We
should be able to explain why we need certain positions and programs, as well
as why we need the numbers of each and the skill levels required.
Here’s how I envision we should build the budget. By
building the budget, I’m referring to all that stuff that currently occurs
hidden from public view. That means gathering of the information and details
used to create the dollar figures that are later viewed by the public.
Here’s how I’d do it.
Document citizen needs. Not all needs are equal in terms of
urgency, comprehensiveness, nor singularly. The needs, however, are probably
known by the various departments as those organizations serve the citizens on a
daily basis. Let’s first document those needs. It’s important to do so because
the county government ought not to be doing something unless there is a citizen
need.
While each need by
the citizen is their highest priority of the government, not every need is the
highest priority to the government. Don’t you think that officials within the
government ought to be challenged to prioritize those needs?
After the needs are
documented, we then need to document the Functions and Services that the county
government uses to satisfy those needs.
Each Function describes the purpose for which
something is designed or exists; role. Services describe the supplying or
supplier of something helpful (i.e., products, activities). A quick detour into
Process Management; Functions and Services are derived from Processes. Each
process documents a series of activities; and can be used to identify Functions
and Services. Activities are the basic work being performed.
Each Department would
then be required to create the Basis of Estimate. That estimate describes and
justifies in detail what they envision is required to successfully perform the
identified Functions and Services.
The output of the
Basis of Estimate is used to identify the type of skills needed, the experience
level of those skills, the minimum amount of knowledge and resources needed.
With the information derived, then the “Number Crunching”
can begin which will yield the needed amount of dollars, number of personnel,
and physical resources needed to satisfy the citizen needs.
It is at that point that I believe the Budget Build should
begin.
We have an
unprecedented opportunity to streamline processes across the county government to increase efficiency (during times of financial
constraints) and to build for the eventual growth that will come.
The only
question in my mind resolves around the question if enough of my fellow county
commissioners agree with the presentation I just gave you. More importantly,
are citizens of this county sufficiently interested in having a more
transparent process in place of the one currently established?
Questions?
