Strategic Planning and the Budget Process. City Manager

Transcription

1 Strategic Planning and the Budget Process Travis Rothweiler, ICMA CM City Manager Lorie Race CFO

2 Association of Idaho Cities Strategic Planning and the Budgeting Process The Purpose of Budgeting Preparation of any budget is the allocation of scarce resources. There will always be more needs than available funds. The challenge is to ensure that available resources are dedicated to the community s and City Council s highest priorities. However, there are many approaches that can be used to allocate funding and resources. Some are: Line Item Budgeting Incremental Budgeting Zero Base Budgeting (ZBB) Performance Based Budgeting (PBB) Planning Programming Budget System (PPBS)

3 OUR APPROACH The City of Twin Falls was looking for an innovative and intuitive approach that would engage our citizens, stakeholders and employees in the budgeting process, which, in turn, could lead to the transformation of our government. After reviewing many different processes, we found Budgeting for Outcomes. Inputs Process Outputs Outcomes/ Results

4 OUR APPROACH Budgeting for Outcomes approach allowed us to make our budgeting process more robust, complete and inclusive. Instead of starting with the previous year s budget and justifying increases or cuts from that budget, we begin our discussion by reflecting on our performance in the prior fiscal year and the strategic planning goals for the upcoming fiscal year. We allocate funds needed to realize intended outcomes/results. Inputs Process Outputs Outcomes/ Results

5 OUR APPROACH Our process allows us to B ETTER E NGAGE O UR C ITIZENS When we are able to align our budgets directly with our citizens, stakeholders and employees priorities, we are able to construct better relationships with the public we are serving. Because our processes are more transparent and more understandable, our citizens are more engaged and have become true partners. Inputs Process Outputs Outcomes/ Results

6 OUR APPROACH Our process allows us to T RANSFORM O UR G OVERNMENT When we are able to change the debate from cutting or adding to discussing outcomes, we were able to change the entire focus of the City of Twin Falls. We have reduced the number of organizational silos, which has allowed us to change the environment and tone and experience of our budgeting process. Inputs Process Outputs Outcomes/ Results

7 OUR APPROACH Our process allows us to E NGAGE OUR E MPLOYEES In a sense, we have experienced a cultural revolution that has helped to develop leaders, improve communication between departments and employees, cultivate new talent, and unify the entire organization around focused outcomes. We are more inclusive, which allows for creation and innovation to occur. Inputs Process Outputs Outcomes/ Results

8 OUR APPROACH Our process allows us to B RING C OMMON S ENSE TO Y OUR B UDGET Opposed to the more traditional budget processes, our focus is now on providing quality services that are aligned with our strategic plan, instead of just adding and/or cutting from last year s budget. Inputs Process Outputs Outcomes/ Results

9 Our Past vs. Our Current Traditional Budgeting Approach Start with last year as the base budget entitlement Focus on adding/subtracting from base entitlements Autopilot increase = new base budget Cut from new base budget Justification for needs and costs, plus extras Incentive to build up costs and budget, which will make future cuts or reductions hard Difficult to find hidden/unnecessary costs Choose to cut services or raise taxes (or both) and get blamed for failing to recognize the cost of taxes and fees Debate the cuts, tax rates, etc. Our Approach Budgeting for Outcomes Start by determining the price of government how much are citizens willing to spend for services. Focus on buying results that matter to the citizens from competing offers Since there is no base, there is no adding and subtracting Since there is no base, there is no adding and subtracting Offer to deliver results at a set price Incentive to produce the most results that matter Validate service levels provided to determine if intended target outcome was reached Choose the best services to offer to meet key intended outcomes at the price the citizens are willing to pay Debate how to get even better results

10 Our Seven Basic Steps

11 OUR APPROACH Our Seven Steps 1. Develop a community driven Strategic Plan. Citizen surveys Facilitated meetings with citizens 2. Present Results from Prior Fiscal Year Using Performance Measurement Data 3. Five year planning tool 5 year budget horizon 4. Annual budget Department Leaders Submit Proposals to Achieve Outcomes/Results 5. Allocate Revenue to Achieve Stated Strategic Planning 6. Rank Proposals and Fund the Best Proposals 7. Share with City Council what proposals are to be funded, which ones did not make the list. Inputs Process Outputs Outcomes/ Results

12 OUR APPROACH Provide feedback: 1. Strategic Plan Quarterly updates to Council on annual progress Strategic Plan Goals and Objectives. What are we accomplishing? More importantly, what aren t we accomplishing and why? 2. Five Year Planning Tool Realistic? Re evaluate and re prioritize. Revisit and review annually Kick off to annual budget process Inputs Process Outputs Outcomes/ Results

13 OUR APPROACH Provide feedback: (cont.) 3. Annual Budget Are we addressing Council priorities? Are we addressing goals and objectives as described in the Strategic Plan? Monthly Dashboard report Quarterly financial presentations to City Council Inputs Process Outputs Outcomes/ Results

14 Association of Idaho Cities Strategic Planning and the Budgeting Process City of Twin Falls Mission Statement Our mission, as stewards of the public trust, is to meet current and future needs of the community, promote citizen input, preserve our heritage, conserve and protect our social and physical resources and enhance the quality of life in Twin Falls.

15 Mission Guiding Principles Accessible Community Environmental Community Secure Community Prosperous Community Learning Community Responsible Community Healthy Community Vision Internal Organization Partners City Departments Goals Objectives Budget Assessment

16 Advance Strategic Planning Priorities Fiscal Year Outcomes Right People, Right Tools, Right Places Protect Public Health and Safety Maintain Infrastructure & Support and Grow Local Economy Internal Organization Healthy Community, Secure Community, Accessible Community, Environmental Community, Responsible community Learning Community, Prosperous Community What are we doing? Why are we doing it? How are we going to get there? Strategic Plan Objectives What do we have to do? What do we want to do? Basic Needs Cost Benefit Value

17 Working to Achieve the Vision Prosperous Community 2030 Vision: A consistent commitment ensuring community residents have access to employment that supports personal and family well being has resulted in a robust economy based upon the traditional agricultural base of the region as well as an expanded economic base from new fields of endeavor. A balanced focus by a variety of regional partners on preparing the local labor force to effectively function in an era of changing skill requirements as well as on going investment in required infrastructure has allowed locally based businesses to expand as their business needs dictate while accommodating new industries and businesses into the marketplace. Twin Falls has continued to serve as the regional retail and professional service center for South Central Idaho and North East Nevada.

18 Examples = timeframe = on going =staffing = capital = communication = partners Air = Airport Division ED = Economic Development Division Fin = Finance Department IS = Information Services Department PIO = Public Information Officer Build = Building Division E=Engineering Division Fire = Fire Department Plan = Planning Division Police = Police Department Goal PC3: Expand the opportunities for business and tourism. Initiative PC3.1: The City will develop a business marketing strategy. Objective PC3.1A: Identify three to five industry sectors that fit the community to create job diversity including more technology jobs, while retaining the focus on agricultural based economy. Objective PC3.1B: Develop and maintain an inventory of industrial buildings and sites. Initiative PC3.2: The City will use tourism as a tool in economic development. Objective PC3.2A: Develop a strategy for funding the development of community facilities that support cultural, recreational and entertainment activities in partnership with other organizations. Objective PC3.2B: Use existing and potential tourism activities as a tool for economic development efforts. Initiative PC3.3: The City will serve as the focal point for economic development efforts. CM = City Manager s Office E PW= Engineering Public Works Department HR = Human Resources Department P&R = Parks and Recreation Division PW=Public Works Division ED ED P&R ED Objective PC3.3A: Focus on both business retention and expansion efforts. ED Objective PC3.3B: Create and support partnerships in pursuit of economic ED development objectives and strategic plan goals. Objective PC3.3C: Explore the viability of establishing an incubator for start up ED businesses and entrepreneurial activity. ED Objective PC3.3D: Explore mechanisms to enhance access to capital for new and expanding businesses.

19 Association of Idaho Cities Strategic Planning and the Budgeting Process Use and Understanding Economic Trends & Indicators Employment Trends Derek E. Santos, Idaho s Chief Economist, said that non farm employment is projected to climb from 622,200 jobs in 2012 to 720,200 in That s an average annual increase of 3.15%. The City of Twin Falls unemployment rate has improved significantly over the course of the last year: From 6.1% in December 2012 to 3.6% in May 2015 The number of workers has also increased by 4.5% (or 2,335) from May 2014 to May 2015 Construction Activity Trends FYTD Single Family Starts increased 30.4% compared to this time in FY 2014 (92 to 120) FYTD New Commercial Starts have grown 46.2% compared to this time in F 2014 (13 to 19) Construction index has increased by 2.98% from February 2014 to February 2015 Cost of Doing Business Trends and use of the Municipal Cost Index From February 2014 to February 2015, the MCI has increased by a total of 0.09%. The Consumer Price Index (CPI) has increased by 0.04% over this same period of time.

20 Association of Idaho Cities Strategic Planning and the Budgeting Process Use and Understanding Economic Trends & Indicators Homeowner's Exemption $120,000 $100,000 $80,000 $75,000 $89,325 $100,938 $104,471 $101,153 $92,040 $83,974 $81,000 $83,920 $89,580 $60,000 $50,000 $40,000 $20,000 $

21 Association of Idaho Cities Strategic Planning and the Budgeting Process Developed Key Budget Drivers for the FY 2016 Budget Overarching Implement objectives contained in the City s 2030 Strategic Plan. Ensure targeted and desired level of services are provided for, as spelled out in the City s strategic plan, the citizen survey, etc. Revenues Conservative approach on raising tax rates and user rates Ensure that new gas tax revenues from the state will be spent on transportation and road system projects. Personnel Continue to make appropriate adjustments and take steps to the City s salary table and benefits to ensure compensation plan remains market competitive Add city staff where is it essential to maintain existing services

22 Association of Idaho Cities Strategic Planning and the Budgeting Process Developed Key Budget Drivers for the FY 2016 Budget Capital Funding for New City Hall and New Public Safety Complex Continue to follow transportation and utility zone maintenance program Enhance and expand trail systems Canyon Rim and Rock Creek Develop additional water storage Canyon Spring Grade design and improvement strategy Develop a plan to improve recreational facilities: recreation center, diversify our park standards to create more unique spaces Programs and Services Enhance sustainability efforts: water conservation (messaging and capital improvements) Develop a sidewalk replacement program Examine and review existing development code to ensure compliance with comprehensive plan and best practices Incentivize recycling Expand business retention and expansion programs Develop a communications audit

23

24

25

26 Questions & Comments Travis Rothweiler, ICMA CM Lorie Race City Manager CFO