1. 1 Nickels and Dimes of the County Budget 773-5932 deene.dayton@state.sd.us

2. 2 Budget Timeline  June – gather data from departments  July – put provisional budget together  August – publish provisional budget  Sept – budget hearing on first Tuesday  Before Oct 1 – adopt the budget

3. 3 Balanced Budget  Each fund has two sides to its budget  Revenue side and expenditure side

4. 4 Budget Detail  Three expenditure levels: Fund – General Dept – Sheriff  Object - Salary Supplies Utilities

5. 5 Budget Detail  Revenue side has three distinct areas: Cash applied (next slide) True revenues Transfers - In

6. 6 Cash Applied  Cash applied is often thought of as negative or described as a structural deficit.  But if properly managed it can be an annual budget tool.  Four factors give rise to cash applied, 1. statutory 5% fudge, 2. 5% contingency, 3. unspent expenditure budget, and 4. over-collected revenues

7. 7 Contingency  Contingency – Department of only the General Fund May not exceed 5% of total budget Transferred by resolution The contingency line is the only budgetary line that may be transferred

8. 8 Lets Save Up  Capital outlay accumulation – SDCL 7-21-51 Extraordinary in nature Exceeds fund ability of a single year 84 months $5 million per purpose

9. 9 Increasing the Budget  Before overexpending a budget a county may- Contingency Transfer - resolution Formal Supplement – notice, hearing Auto Supplement – motion (sale of surplus property results in revenue, not a change in the amount of the budget)

10. 10 Increasing the Budget  Addressing overexpenditures early allows for two choices: Reduce spending Increase budget

11. 11 Monitoring the Budget  Monitoring the budget – WHO Head of Department - daily County Auditor – provides status Governing Board - monthly

12. 12 Monitoring the Budget  Monitoring – WHY Deterrent to fraud Statutory compliance Pulse of the county – where are we at and where are we going

13. 13 End of Year???  Year end cutoff – Cash Basis – when paid GAAP Basis – when goods delivered or services rendered Communicate deadlines with outlying departments

14. 14 Tomorrow’s Budget  Why care about the future?  How long does it take to get – An opt out dollar A statutory change to license plate revenues Out of a fiscal hole

15. 15 Future Planning  How far ahead do I project?  Too far and its accuracy is questioned, we are in a world of change  Going a year or two does not present much of a trend

16. 16 Revenue Elements Cash Applied – roll from one year to next Property Tax – CPI plus growth License Plate Fees – Static?

17. 17 Revenue Elements  Property Tax Last year’s levy in dollars Increase for CPI Increase for growth due to new construction

18. 18 Revenue Elements  Opt Out – Asking to tax more than statutorily allowed  Resolution before July 15 th  Notice  State how much and how long  Schools are different

19. 19 Revenue Elements Prisoner Care – Jail size, rate increases Federal Grants – some are annual Interest Earned – ask Bernanke

20. 20 Expenditure Elements  Even though county expenditures are budgeted by fund and department, consider developing those figures by viewing expenditures on a segment by segment basis.

21. 21 Expenditure Elements  Salary – how much, how many, turnover  Health Insurance  Supplies – analyze by type for hwy, fuel, culverts, asphalt, road oil, paper clips, etc.

22. 22 Expenditure Elements  Debt Service – payment schedules  Insurance  Repairs and Maintenance

23. 23 Expenditures Elements  Capital Outlay  Technology  Vehicles  Buildings  Other Equipment

24. 24 Budget Indicators  Budget indicators: Is the cash balance declining? Is the debt load increasing? Is the deferred maintenance on roads, bridges and buildings increasing?

25. 25 Budget Flow  2009 2010  Beg Balance100110  Revenues100100  Expenditures 90 95  End Balance110115  Is it bad if the ending balance grows each year

26. 26 Reserves  How much should you have????

27. 27 Reserves  Consider the following: Risk of large unforeseen expenditures Capital Accumulations Other future capital needs Cash Flow (Jan – May) Risk of decreasing revenues

28. 28 Reserves by Entity Type  CITY, COUNTY, SCHOOL Cash Flow Large Unforeseen Expenditures Capital Needs Even within one type of government….we’re not all the same