Simplifying the Budget Process Lindsey Duncan– City of Surprise Brandi Suda – City of Flagstaff Candace Cannistraro – City of Mesa

How the Budget Process Can Seem What can we do about it?

No More Preliminary Budget Books When is it too much information? What information is actually valuable? Full preliminary budget books take a considerable amount of staff time for both content and formatting Department schedules, Financial Schedules, 200 plus pages Replaced with Summary of Proposed Budget Assumes they have the current budget book and outlines just the changes, 26 pages, bookmarked electronic council report Gives an overview and status of the various funds and overall budgetary pressures Gives an overview of significant changes in department budgets “This is the best summary of the budget we have ever had.” “We don’t need to meet with all the departments. It’s all right here.”

Coordinate Related Processes Timelines are aligned with annual budget process Process coordination and oversite is done centrally All financial information is reviewed centrally Requires additional staff time and effort Avoids conflicting information being presented Avoids the surprise factor What did they just say?!

Fees and Charges Process OMB reviews and presents all documents from departments to City Council in a comprehensive manner. Department staff are in attendance for specific questions or background regarding the fee. Ensures adherence to the 60 day legal posting requirement Increased standardization of reports/information Increased efficiency of presentation of information Provides a logic check for departments

Utility Rate Modifications One consolidated report and presentation is created for all five Mesa utilities OMB Director leads presentation and serves as facilitator Adoption of new rates are aligned with adoption of budget Unified voice in rate and structure recommendations Ensures adherence to legal requirements Focus on overall health and sustainability of the Enterprise fund

Roundtable Question How do you ensure Budget staff and Department staff are speaking the same revenue/expenditure story?

Replace What with Line item budgeting allows for tracking the type of expense but it doesn’t say why the expense was needed Mesa discontinued giving line item information to the City Council, including removing all but the City level schedule from the budget book Long discussions with Council and requests for additional information regarding travel, professional services and such went away But what do we give them then?

Mesa’s Budget Documents No Divisions or Sections Only Expense Categories

Roundtable Question What type of documents do you share with your Council for budget review?

Performance/Activity Based Budgeting What are the overall goals/vision of the City? What is the department’s public purpose? Why do they exist? How does what we do align with the city’s goals/vision? What are next year’s goals/objectives for each department/program? How will they know if they are successful? What resources will it take to be successful?

How do you incorporate Performance Management in your budget process? Roundtable Question How do you incorporate Performance Management in your budget process?

Developing the Budget with City Management Finance meets with all departments on budget requests including Revenue estimates Change requests (supplemental requests) Capital Projects Budget prepares a list of change requests Based upon capacity for additional positions and programs categorizes Yes, Not Now, Maybe Finance prepares a recommendation for the City Manager City Manager approves recommendation or adds/requests changes

Roundtable Question What role does the budget workgroup play in meetings with/recommendations to City Management?

Position Requests Description Justification

Human Resources Review HR reviewed and classified every position requested based on the form Now, HR is given list of positions along with description and justification HR reports approximate grade for personnel estimates Upon approval, HR performs formal analysis

Straightening the Pipes Effort at the City of Flagstaff Goals Simplify & improve the process for both users and finance staff 2. Shorten entire budget process from beginning to end 3. Save time & effort for all

Straightening the Pipes Key to Success Key to our success was obtaining feedback at all levels in the organization. Surveyed all employees that were involved in the budget process Held meetings with employees at all levels within the City REMINDER: Check-in and reevaluate further changes

Straightening the Pipes Obtaining Feedback What did we ask and discuss: Usefulness of materials provided by Finance How well they thought they understood the various budget steps/processes Quality of communication they receive Feedback on some ideas the Finance staff presented for improvements

Straightening the Pipes Results Reduced data entry Reduced the amount of required paperwork Eliminated steps that provided minimal value Realigned deadlines to match better with decision points Provided more timely financial data to Departments Improved timeliness & quality of communication Cut approx. 3 weeks off the overall process

What internal processes did you go through to begin simplification? Roundtable Question What internal processes did you go through to begin simplification?

Council Presentation of the City Manager’s Recommended Budget

Stop the Parade

Stop the Parade Not necessary to showcase the entire department during the budget presentation Nor is it necessary to hear every department’s budget Consistent organizational wide budget message Reduces the opportunity for political persuasion

Focus on Topics, Decision Points & Results Work to move the focus away from detailed financial data. Focus on the highlights. Only present those departments or topics with budgetary issues that need feedback and input from Council. Consider focusing the discussion and presentation on how the budget will further/align with the Council Goals/Strategy Plan, etc. Council can still request specific presentations based on the information in the preliminary budget overview.

Roundtable Question Do you hold Budget Retreats? How do you receive feedback from stakeholders? Timing? Frequency? Content? Format?

Roundtable Question How do you inform your Council and incorporate their input in the budget process?

In Closing