1. Extending the CORE® to YOUR Court Budget and Fiscal Management
Practice
Module
Budget and Fiscal Management

2. The Competency

3. Course Agenda
The amount of information in this curriculum is extensive so the course will need to be broken down into a few components offered at different times or offered over several days.
This component will be on budget management including budget development, justification, and presentation.
Add a agenda for the course here

4. Learning Objectives
Write a budget justification for a new program or budgetary need.
Develop a plan for responding to potential budget cuts or for funding for a new project.
Define relevant financial policies for the courts and their purpose.
Develop a budget for changes needed in court facility.
Develop a plan of action for emergency situations involving the court’s fiscal operations and facilities.
Identify individual learning needs and objectives related to budget and fiscal management.
List the basic differences between generally accepted accounting practices and governmental accounting practices as they pertain to adequate controls and audit compliance.
Develop a plan to safeguard the court’s assets.
Define key fund accounts and assess true costs of applying for and managing grant funds.

5. Court Manager Responsibilities
All areas of the court impact the court’s budget
Court managers need to be competent in the area of fiscal management, budget development, and fiscal oversight
Court managers need to ensure that the vision, mission and goals of the court are achieved and maintained
Court managers need not be technically competent in every area of financial operations, but they must know how to address budget and financial questions, prepare for an audit, how to select and manage fiscal staff and how to read financial reports.

6. What do Court Managers Need to Know
Basics of the primary accounting functions such as procurement, accounts payable, accounts receivable, cash receipts, court collections, etc.
How to manage the court’s fixed assets
What fund accounting is and how it works
Key accounting terms (listing of key terms included in curriculum)
Funding sources court has and can access, including new sources of funding (fees, fines, restitution, and special assessments)
The differences between private and public sector accounting

7. What do Court Managers Need to Know Financial reporting requirements
How to prepare for a financial audit
How to manage court facilities
Maintenance schedule
ADA requirements
Active life of equipment
Maintenance agreements
Planning for future renovations
How to plan for fiscal responsibilities during an emergency and what considerations must be part of the Continuity of Operations Plan
How to manage grant funds from the application phase to the completion phase
How to develop a comprehensive budget for the court (anticipating budget cuts or increases)
How to maintain the court’s budget
Key financial policies necessary

8. Activity 1 Introduce yourself Tell your role in the court
Your court affiliation
Identify your most pressing need for this education area
Examples:
How to read a financial statement
How to handle auditors and the audit
Answers will be recorded on flip chart to ensure that all questions are addressed before the end of the session

9. Poll Question #1 Q: Does your court have a Strategic Plan? Yes No
Answers will be recorded on flip chart to ensure that all questions are addressed before the end of the session

10. Poll Question #2
Q: Does your court related Budget Objectives/Expectations to the Strategic Plan?
Yes No
Answers will be recorded on flip chart to ensure that all questions are addressed before the end of the session

11. Poll Question #2
Yes No
Answers will be recorded on flip chart to ensure that all questions are addressed before the end of the session

12. How Does Budgeting Relate to Your Court’s Needs/Wants?
Based on the poll question responses, __________ of your courts have strategic plans and _________ courts use the strategic plan for budgeting purposes. If we know where we want to be, it is easier to plan to get there. The budget has a direct impact in the decisions made.
Court budgets should result from the goals and objectives of the Court and support the mission.
A budget is a plan. The budget is a plan of action matching the resources with the wants/needs of a court.
There are different types of budgets:
Operating budget
Capital budget
Proposed budget
Amended budget
Annual budget

13. Budgeting Process
The budgetary process is similar to the legislative process. Court managers have various duties in the budget process (not everyone has the same responsibilities). Dependent on the funding sources, the Court may have various budgets with specialized requirements per the funding source. There may be state laws regarding public budgets that need to be adhered to.
The budget process is an ideal time for Court personnel to be involved in the financial planning. Developing a budgetary calendar may be helpful and holding hearings to gather feedback.
Budget Process:
Proposed Budget
Original Budget
Adopted Budget
Amended Budget
Final Budget

14. Budget Drafting What’s your role in the budget process?
The Budget is a tool and mechanism of fiscal control. Budgets are a common tool for comparing organizations, sharing fiscal information, and highlighting an organization’s purpose and role.
The Budget should be a clear statement for projecting and recording how public monies will be used.
What’s your role in the budget process?
Who controls your budget?
Does the Court control their own funds?

15. Budgeting Approaches
There are numerous budgeting approaches. Three approaches most often used in court systems are:
Zero-based budgeting – All fiscal needs must be re-justified each year.
Program-based budgeting – Hybrid that uses previous years’ budgets as a baseline and justifies continuation, changes, and new funding based on demonstrated performance and outcomes
Continuation (incremental) budgeting – All previously justified and approved funds are continued in the new budgeting period will adjustments for increased costs (inflation)

16. Types of Budgets
There are many types of budgets. The most applicable types of budgets to courts are:
Operational Budget – General budget which includes expenses for running the court. Includes personnel, supplies, equipment, etc.
Project Budget – Budget specific to a certain area or project. Example: Drug Court Budget
Capital Budget – Budget for expenditures resulting in the acquisition of or addition to the court’s tangible assets such as buildings and land.

17. Budget Considerations
Some Considerations for Budget Inclusion:
General/Recurring Expenditures – What costs are going up? Estimate the costs
Equipment Refreshment Plans – Do you replace computers every three years? What is getting replaced?
Maintenance Schedule – Do you replace carpet or paint this year? What needs to be fixed?
Capital Improvements – Are you renovating?
Budget Cuts – Are we asked to cut funds from categories?

18. Budget and Fiscal Management Assessment of Needs
How does your court plan for:
Future courthouse improvements
Technology enhancements
New judgeships
Infrastructure improvements
Implementing a special program
How can you improve this process?

19. Budget Template
Insert a budget example here for discussion and review purposes

20. Budget Preparation
The complete budget preparation process includes several tasks:
Develop a calendar;
Identify responsibilities and deadlines;
Review process to ensure on schedule;
Produce reports;
Identify issues and problems;
Assign responsibilities for problem solving; and
Ensure requirements are met.

21. Revenue Projecting Revenue projection methods: Economic forecasts
Case analysis
Trend analysis
Regression analysis
Revenue estimates need to be updated regularly in order to adequately address budget implications.
Typical Court Revenue Sources:
General Fund Revenue – state or local funds
Fines
Filing Fees
User Fees
Grants

22. Operating Expenses Typical Court Expenses: Personnel
Contracts – interpreters, repairs
Equipment
Travel/Training
Telephone
Office Supplies
Security
Utilities
Furniture

23. Estimating Expenses
Expense estimates should take into consideration increases in cost for inflation.
Projecting the costs for the period helps to determine amount necessary. Comparison to the previous year should be completed.
Personnel cost adjustments and benefit increases need to be addressed in the budget planning.
The cost impact for adding additional services needs to be fully anticipated—additional space, personnel, equipment, etc.

24. Encumbrances
Sometimes courts need to encumber or save funds for a specific purpose. These encumbrances are not budgeted until the appropriation of funds is necessary.

25. Defending a Budget
A normal part of the budget process is defending the budget to your funding authorities.
When presenting a budget request, the court manager (presenter) should present a well-organized request with all essential information. A budget justifications should include:
Statement of Need
Connection to the Mission
Supportive Information – data and other information that demonstrates the need for funding by the court.
Effective/efficient practices – how services produce savings
Summary of funding needed
Consequences of request denial

26. Group Exercise 1
Purpose: Draft a budget justification for a new program in your court. It should be a brief explanation of the budget needs and clear written justification of costs to be reviewed by decision-makers.
Notes about using the activity: Participants can be divided into small groups to write the budget justification. The size of the group is dependent on the size of the class. Groups should be given minutes to write out their justification and then given ample time to present to the group for learning purposes.
You recently mentioned to your chief judge that self-help centers would assist many court personnel in working more effectively with the public. Your chief judge has asked you to write a budget justification for the development of self-help centers.

27. Managing Budget Cuts
Budget cuts are inevitable. Court managers who have to deal with financial stress are limited in the options they may have to deal with it.
A plan for financial crisis should be considered long before the actual crisis.
In order to manage funding/budget cuts, a court manager must:
Know what the court has– financial, physical, and human resources available
Know what the court needs as a baseline
Know how to get help – other agencies to help with cuts

28. Budget Cut Funding Options
Possible funding options:
Direct Funding – requesting additional funding
Indirect Funding – requesting assistance from another entity that benefits from the program
Shared Funding – requesting financial assistance from all the agencies that are involved and benefit from the program
Grant Funding – requesting additional funds through grants
Communication is the Key

29. Budget Shortfalls Can the Court increase revenues to offset the cut?
Can you add additional court costs?
Can you charge user fees?
Can the Court reduce expenditures?
Can we cut office supplies?
Can we cut personnel?

30. Reducing Expenditures
Strategies for Reduction:
Hiring Freeze
Reduction in Overtime
Postpone equipment replacement
Reduce Travel/Training
Reduction court hours of operation
Close court facilities
Outsource
Stop providing a service
Eliminate a program

31. Group Exercise 2
Purpose: The purpose of this activity is to explore some of the challenges when dealing with budget cuts or creating a new program.
Notes about using the activity:
In this activity, participants will be split into two groups. Each group will be given a scenario and will brainstorm to determine the appropriate action. The length of the brainstorming should be approximately minutes with ample time for report out by each group for continued learning.
Scenario: The court’s drug court is provided by a state grant. The state has just notified the court manager that the funders may require a 50% cut in funding or the whole grant may be cut.
Group 1: You are the court manager and have to plan for the potential 50% cut in drug court funding. The judges would like a report of funding cut options for the next judges’ meeting. What will you do? Who will you call together to develop the plan? How will you determine what can be cut? Are layoffs a possibility? If so, what else must be done to accommodate (employee notice, human resource notices)?
Group 2: You are the court manager and have to plan for the potential complete cut in drug court funding. The judges would like a report of funding cut options for the next judges’ meeting. What will you do? Who will you call together to develop the plan? How will you determine what can be cut? What are the other funding options? Are layoffs a possibility? If so, what else must be done to accommodate (employee notice, human resource notices)?

32. Budget and Fiscal Management & Other Competencies

33. Resources
Core Website:
nacmcore.org