Board Budgeting Basics

Transcription

1 FCCC Winter Conference February 5, 2015 Cocoa Beachfront Hilton Cocoa Beach, Florida

2 Honorable Brent Thurmond, CPA Wakulla Co. COC Honorable Becky Norris Gulf Co. COC Honorable Kellie Connell, CPA Union Co. COC Sherry Herring, Budget and Finance Director Gulf Co. COC BOARD BUDGETING BASICS

3 FCCC Winter Conference February 5, 2015 Cocoa Beachfront Hilton Cocoa Beach, Florida

4 A long time ago in a county far far away Changing the names and faces to protect the location and identity of those involved

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14 What is Budgeting? The process of allocating resources to fund operations and projects. Resources Ad Valorem Tax revenue Other Taxes (Communications Services, Gas ) Revenue Sharing Proceeds Charges for Service Impact Fees Grant Revenue Debt Proceeds Interest revenue

15 What is Budgeting? Operations and Projects Personnel Rent, Lease, Mortgage Utilities Expendables Equipment FCCC Conference attendance Capital assets and infrastructure Constitutional Officers!!

16 Importance of Budgeting in County Government Without an appropriation, no funds can be spent The budget controls the type of services and the level of those services provided. In order to spend or obligate resources: The item must be a budgeted expenditure. The item must be an approved expenditure. There must be enough cash-on-hand to cover the expenditure. Stringent controls are necessary because we are dealing with Public Funds.Accountability.

17 Quiz time (already?!) A budget in your county is:

18 1. It is a financial plan, an instrument of law, and an operational guide 2. It is a policy document 3. It is a communications tool 4. It is very different from a budget in private business 5. All of the above

19 A budget is A Policy Document. Long-term financial policies. Non-financial policies and goals. Responsiveness to needs of community. A comprehensive message on services, outcomes, taxation levels, and transparency.

20 Budgeting dovetails into financial policies Formal vs. informal Revenue Reserve Investment Debt Financial Reporting.etc..

21 Budget Policies Inflationary Factors Requests (Equipment, Personnel, Extraordinary Items) Internal Transfers and Amendments Millage Rate All Funds Staffing Health Insurance Contingencies etc.

22 Basic Budget Cycle APPLICATION NEEDS & WANTS REQUESTS FINAL APPROVAL PRELIMINARY BUDGET PUBLIC HEARINGS REVIEW LEGISLATIVE WORKSHOP TENTATIVE BUDGET

23 A Financial Plan Includes all funds. Basis of budgeting. Summary of all major revenues, expenditures as well as other sources of financing. Summary of prior year actual, current year budget and actual (or estimate), and proposed budget. Projected changes in fund balances. Description and disclosure of capital expenditures

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25 An Operations Guide Activities, services and functions carried out by the organization. Objective measures of progress toward accomplishing the organizational mission. Many times incorporates outcomes or measures into the preparation and reporting. Organizational chart. Summary of prior, current and budgeted personnel.

26 A Communications Device The effect other planning processes have upon the budget and budget process (TRIM etc). Description of the process for preparing, reviewing, adopting and amending the budget. Charts and graphs where appropriate and a narrative interpretation if the message is not selfevident. Statistical data. Formatted so that the average reader can navigate the document and understand the content.

27 Four phases of Budgeting Preparation Adoption Implementation Maintenance Through all phases accountability should be a guiding principle

28 Preparation Budget instructions, calendar and kick-off letter from budget officer. Departments & Divisions role in developing requests. Established budget review process at various stages. OMB/Finance estimates revenue and fund balances. Revenue, fund balance and expenditures put together. Balancing act continues throughout the process. Which comes first, Millage Rate or the Budget?

29 Preparation When do you start? How do you deal with imbalance in early stages? Schedule the Revenue work Do you get estimates from your Property Appraiser and how accurate are they? Commissioner Workshops, how many? Public Hearings Any experience with Citizen Committees?

30 FY2015/2016 Wakulla County BOCC Budget Calendar DATES ACTION December 2014 Finance department prepares budget calendar based on DOR guidelines and other factors to outline the budget process for the Board, County Administrator, Constitutional Officers and Division Directors. January 5, 2015 BOCC Approval of the FY2015/2016 Budget Calendar Finance Department begins preparing the working budget documents. This preparation includes the update of prior fiscal year unaudited financial information, current fiscal year financial information, and personnel information for all current Board employees. All personnel related items are calculated off current rates (FICA, FRS, CHP, etc.) Employee only health coverage is assumed for each employee not enrolled in the county health insurance program. Employees that are enrolled in the county health insurance plans are calculated based on the plan type of the employee and then increased by 5%. This will be the first year the Board absorbs only a portion of the increase, if approved. March 2, 2015 Notification of upcoming budget development meetings Finance Department sends a reminder via to all Constitutional Officers, Division Directors and other stakeholders in the budget process. Finance Department prepares and agenda item for the first workshop. March 9, st Budget Development Workshop (time to be determined) This workshop gives the County Administrator an opportunity to inform the Board of the assumptions and methods that will be used to prepare the budget. It also provides the Board a platform early in the budget process to voice concerns, request funding for special interests or projects and interact with the public.

31 FY2015/2016 Wakulla County BOCC Budget Calendar March 11, 2015 Mandatory Budget Kick-Off Meeting with all Departments 10:00 a.m. Finance Department provides all Division Directors with the working budget documents for the funds/department they are responsible for. The County Administrator speaks with the Division Directors about goals and benchmarks for the upcoming fiscal year. He also outlines the assumptions used in preparing the budget such as cost of living allocations percentages, health insurance increase percentages and changes in operating costs. The Division Directors have the following month to analyze the Finance Department projections. Any requests for funding changes should include supporting documentation gathered by the Division Director. All foreseeable personnel changes should be itemized and vetted by the Division Director. April 14-30, 2015 Meetings with Departments to review requested budgets. The County Administrator schedules budget review meetings with each Division Director. During the meeting, prior fiscal year and current fiscal year to date financial position of each fund/department is discussed. Division Directors are responsible for identifying trends and developments that may affect the assumptions and projections prepared by the Finance Department. Division Directors should also inform the County Administrator and Finance Department of any requested changes for personnel expenses, operating expenses and equipment requirements. Any supporting documentation gathered by the Division Director should be provided to the County Administrator and Finance Department so a decision on the request can be made. All decisions made in these meetings are preliminary and subject to Board approval and available funding. May 1, 2015 Final Day for Constitutional Officers to Submit Budget Requests to Board (F.S [2])

32 FY2015/2016 Wakulla County BOCC Budget Calendar Finance department integrates the Constitutional Officers budget requests into the working budget documents. May 4-15, 2015 Meetings with Constitutional Officers to review requested budgets. The County Administrator and Finance Department meet separately with each Constitutional Officer (if necessary) to discuss the requested budget and level of funding. Finance Department prepares an agenda item for the workshop. June 15, nd Budget Development Workshop (time to be determined) The County Administrator informs the Board of any material requested changes by Division Directors and Constitutional Officers. Any departmental restructuring, possible service rate changes, increase in personnel and other important factors are discussed. This is also a second opportunity for the Board to voice concerns, question budget assumptions and interact with the public. June 16, 2015 Board submits number of hardship exemptions to Property Appraiser (2 weeks prior to July 1) Finance Department integrates the number of hardship exemptions into the working budget documents. Any exemption related interfund transfers are calculated and scheduled into the working budget documents. The financial information for current fiscal year through May 30 is updated in the working budget documents. Finance Department prepares an agenda item outlining the TRIM guidelines, highlighting any material changes to the budget up to this point in the budget process and requesting the Board to schedule and advertise two required public hearings. July 1, 2015 Submit agenda item for July 20 meeting setting two public hearings for the tentative and final budget

33 FY2015/2016 Wakulla County BOCC Budget Calendar July 1, 2015 Certification of Taxable Property Values by the Property Appraiser to Board ( F.S.) DR-420 Form Finance Department receives the DR-420 with the Property Appraiser portion completed. The Ad Valorem calculations from the DR-420 are integrated into the working budget document. Finance Department completes the taxing authority portion of the DR-420 and returns the original form to the Property Appraiser within 35 days. A copy of the DR-420 is also provided to the Tax Collector. The Finance Department begins compiling all the information from the working budget documents into a preliminary presentation document for the Board. July 15, 2015 Preliminary Balanced Budget is placed on the desks of the Board of County Commissioners. (F.S [3a]) The Board reviews the preliminary budget presentation document. The Finance Department continues to monitor revenue estimates and updates the current fiscal year financial information through June 30 in the working budget documents. July 20, 2015 Board Sets First and Second Public Hearing Dates and adopts Preliminary Rate Resolutions for Solid Waste Assessment and Fire M.S.B.U. (Municipal Services Benefit Unit) Finance Department integrates the adopted solid waste and fire MSBU rates into the working budget documents and makes necessary adjustments and schedules interfund transfers to the corresponding funds. August 1, 2015 Board to Advise Property Appraiser of Proposed Millage Rate, Roll Back/Up Rate, Date, Time and Place of First Public Hearing. ( [4b]F.S.] Finance Department continues to monitor revenue estimates. Cash forward balances are calculated based on current cash balances, revenue and expense estimates for the remainder of the fiscal year and individual fund analysis. Finance Department prepares an agenda item for the final budget workshop. August 3, rd Budget Development Workshop (time to be determined)

34 FY2015/2016 Wakulla County BOCC Budget Calendar August 3, rd Budget Development Workshop (time to be determined) The County Administrator delivers the highlights of the major funds to the Board. The Board has another opportunity to express concerns, discuss budget assumptions and interact with the public. August 14, 2015 Last day for the Board of Commissioners or the Property Appraiser to submit additional information or testimony to the Department of Revenue regarding the Property Appraiser s tentative budget request. ( [1a]F.S.] August 15, 2015 Deadline for Department of Revenue to make Budget Amendments or changes to the Property Appraiser s Budget. August 19, 2015 Property Appraiser mails Notice of Proposed Property Taxes ( [4b]F.S.) (*within 55 days of Certification or 10 days after tax roll is adopted or 20 days prior to tentative hearing for non-ad valorem assessments) Finance Department prepares and submits the preliminary TRIM notice to Department of Revenue for preapproval and then submits approved advertisements to Wakulla News. This is not a DOR requirement, but it used as more of a rehearsal for the final public hearing advertisements. August 27, 2015 Deadline to submit appropriate Preliminary TRIM notice to Wakulla News Finance Department checks the website of the Office of Demographic Research daily in order to assess any changes in the salaries of Elected Officials. These changes are integrated into the working budget documents as soon as they become available. September 3, 2015 Preliminary TRIM Notice published in Wakulla News Finance Department continues to update the working budget documents with current fiscal year position, monitor revenue projections and update the preliminary budget presentation document. Cash forward estimates are also reevaluated. The preliminary budget

35 FY2015/2016 Wakulla County BOCC Budget Calendar presentation is forwarded to Administration for posting to the Board website. September 4, 2015 County posts preliminary budget on website 2 days prior to first public hearing (129.03[3c] F.S.) September 8, 2015 Board adopts the Preliminary Rate Resolutions for Road Paving Assessments The County Administrator discusses for the Board any material changes made to the major funds since the final budget workshop. Finance Department prepares an agenda item for the first public hearing. September 8, st Public Hearing to be held on Tentative Budget and Proposed Millage Rate ( [4bc] F.S.) (*within 80 days/no sooner than 65 days from Certification) The Finance Department prepares and submits the final TRIM notice to Department of Revenue for preapproval and then submits approved advertisements to Wakulla News. Any changes directed by the Board are integrated into the working budget documents. September 10, 2015 Deadline to submit Final TRIM Notice to Wakulla News The following dates are based on the Public Hearing to Tentatively Adopt Budget and Proposed Millage Rated taking place on September 8, September 17, 2015 Advertise in Wakulla News Notice of Final Budget & Millage Rate & Intent to Adopt a Millage Rate & Final Budget ( [4d] F.S.) (*within 15 days after the tentative hearing) The Finance Department continues to update the working budget documents with current fiscal year position, monitor revenue projections and update the preliminary budget presentation document. Cash forward estimates are also reevaluated. Finance Department prepares an agenda item for the second public hearing.

36 FY2015/2016 Wakulla County BOCC Budget Calendar September 21, nd Public Hearing to be held on Final Budget & Adopt a Millage Rate by Resolution or Ordinance ( [4d(3)] F.S.) (*within 2 to 5 days from time Notice of Intent is published) Finance Department integrates any Board directed changes into the working budget documents. The final budget presentation document is completed and presented to the Commissioners in hard copy and electronic format. The final millage rate and budget resolutions are forwarded to Department of Revenue, Tax Collector and Property Appraiser. September 24, 2015 Board to forward Resolution or Ordinance adopting Final Millage to Property Appraiser, Tax Collector and Department of Revenue. Finance Department completes the remaining required TRIM forms and prepares the TRIM compliance package for submission to Department of Revenue. The final budget presentation document is forwarded to Administration for posting to the Board website. Finance Department begins preparing the working budget documents into format suitable for import into the accounting program. Final budget is imported to accounting program. October 24, 2015 Certified Compliance to the Department of Revenue. October 24, 2015 County posts final budget on website within 30 days of final budget hearing (129.03[3c] F.S.) Finance Department takes a week off for vacation.

37 Preparation Know the laws and rules for budget preparation, external and internal. Review existing policies and procedures. Set Goals. When presenting challenges, offer solutions. Include Long Range Financial Models. Conclude workshops with consensus and direction.

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39 Approval. Statutorily the governing authority is presented with a recommended budget for review. Board gives staff direction. Staff prepares the tentative budget for Board approval. After two public hearings the final budget is approved by resolution or ordinance

40 War Stories Gulf County Miami-Dade County

41 FY2015/2016 Budget Calendar DATES ACTION December 2014 Finance department prepares budget calendar based on DOR guidelines and other factors to outline the budget process for the Board, County Administrator, Constitutional Officers and Division Directors. January 5, 2015 BOCC Approval of the FY2015/2016 Budget Calendar Finance Department begins preparing the working budget documents. This preparation includes the update of prior fiscal year unaudited financial information, current fiscal year financial information, and personnel information for all current Board employees. All personnel related items are calculated off current rates (FICA, FRS, CHP, etc.) Employee only health coverage is assumed for each employee not enrolled in the county health insurance program. Employees that are enrolled in the county health insurance plans are calculated based on the plan type of the employee and then increased by 5%. This will be the first year the Board absorbs only a portion of the increase, if approved.we March 2, 2015 Notification of upcoming budget development meetings Finance Department sends a reminder via to all Constitutional Officers, Division Directors and other stakeholders in the budget process. Finance Department prepares and agenda item for the first workshop. March 9, st Budget Development Workshop (time to be determined) This workshop gives the County Administrator an opportunity to inform the Board of the assumptions and methods that will be used to prepare the budget. It also provides the Board a platform early in the budget process to voice concerns, request funding for special interests or projects and interact with the public.

42 Implementation How do you make changes to the decisions or modifications at final hearing? How do you communicate with departments on approved amount? What system(s) do you use for budgeting?

43 Maintenance, Monitoring, Managing Monitoring. Revenues Expenditures negative balances and internal transfers. Must have an approved policy detailing the process of adjusting the budget Budget Amendments and Florida Statutes.

44 Maintenance monitoring and managing Who monitors revenues and expenses? At what level of budgetary control are expenditures monitored? What corrective steps are taken in current year? What adjustments are made to future budgets?

45 How do you amend the budget for a revision of cash forward or from any source anticipated? (2)(f) Unless otherwise prohibited by law, if an amendment to a budget is required for a purpose not specifically authorized in paragraphs (a)-(e), the amendment may be authorized by resolution or ordinance of the board of county commissioners adopted following a public hearing. 1. The public hearing must be advertised at least 2 days, but not more than 5 days, before the date of the hearing. The advertisement must appear in a newspaper of paid general circulation and must identify the name of the taxing authority, the date, place, and time of the hearing, and the purpose of the hearing. The advertisement must also identify each budgetary fund to be amended, the source of the funds, the use of the funds, and the total amount of each fund s appropriations. 2. If the board amends the budget pursuant to this paragraph, the adopted amendment must be posted on the county s official website within 5 days after adoption.

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47 Accountability I suggest you focus on this 24/7/365 Decisions made on budgets must be in the Sunshine and subject to public scrutiny. Sunshine law - who it impacts in budgeting? In public budgeting and finance, Transparency is more than just a buzzword. Web site posting requirement and how much non-budget info to include in document.

48 Board Budgeting Phases PREPARATION ADOPTION IMPLEMENTATION MAINTENANCE ACCOUNTABILITY

49 BUDGETING REVENUES Input from departments and constitutionals. Some are formula driven/provided. State Revenue Sharing Gas taxes Consult State REC Look at historical trends, weighted averages, etc. In some cases you may use combinations of estimating methodologies. Pay attention to economic developments US, Florida, and your county.

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51 BUDGETING REVEUNES Be aware of any new sources of revenues. New surtaxes New programs that generate revenue Change in Charges For Service schedule Are you within the guidelines of your legislative body? Budget conservatively.

52 BUDGETING CASH FORWARD Begin looking at this early in the process. Run a Trial Balance Report and calculate current Cash On Hand for each Fund. Estimate revenues you expect to receive for the remaining fiscal year.

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54 CAUTION CAUTION CAUTION There is never a guarantee that you will have excess fund balance to carry forward or what the amount will be. If you use this in your budget do not use it to fund on-going operational or personnel expenses. Appropriate uses include: Contingency reserves One-time purchases (Vehicles or Equipment) Renovations or remodeling

55 Operating Expenditures Departments and Divisions either submit their request or input the information directly. Do you use trends to estimate your needs? Do your Budget Preparation Instructions include a policy for anticipated inflation? Some entities require a justification for certain operating expenditures. Furniture and Fixtures Travel Dues and Memberships Training and Education

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57 Communications Citizen reports Internal reports- What are in your budget monitoring reports Budget Detail Report Summarized Financial Statements Allows tracking of the overall performance of a fund/all funds. Enterprise Program Reports How does the Clerk notify BCC of over-budget issues

58 TIPS FROM OUR EXPERIENCES New position budgeting Benefits budgeting Pay scale Odd year events

59 Long term operating budget plan Wakulla uses a 5 year excel and updates it regularly Capital budgeting is like combination of operating annual and long term Capital Improvement Plan 5-Year schedule Capital Improvement Budget Year 1 of the Capital Improvement Plan

60 TRIM and F. S. 129 and F. S. 200 TRIM link Budgets have the force of law, and violations of law are subject to legal sanctions!

61 You could give us a nice evaluation, but tips would be more appreciated! THE END (IS NEAR)

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