1. FY 2017-18 BUDGET INSTRUCTIONS WORKSHOP
Friday, 12/16/2016

3. BUDGET DEVELOPMENT CALENDAR ESTIMATES

4. Highlights & Changes 1 fiscal year budget
Consolidated Budget Adjustments
Federal/state funding allocations
Peer review support
Earlier budget development start
Recommended and Requested budgets
Adopted to recommended $ variances
No assumptions from successor labor agmts
Reports by position record – yay  !!
2017 Board Priorities

5. Budget Flow Base Budget Mid-Year Estimates Budget Policy Issues
Program Changes
Requested & Recommended Budget
Adjustments to Fees & Charges
Third Quarter Estimates
Supplemental Changes
Budget Hearings Actions
Adopted Budget

6. Calendar Review

7. Calendar Review

8. Calendar Review

9. Mid-Year Estimates due Jan. 20th
Salary & Benefit Tracking Tool
Hyperion Instructional Video (UPK)
Template for Submission to CAO
BUD005 - BudgetEstimateSummary

10. BUD005- Budget Estimate Summary

11. Consolidated Budget Adjustments
Current FY Q2 Prior Board Direction Only Adjustments due on Feb. 7th
FY will also likely only include two Consolidated Adjustments (fall and spring)

12. Defining Prior Board Action
A specific action by the Board
Only way to use contingencies or add positions
Continuation of a Board-approved program
Can include appropriation of new revenue
Clean-up transactions
Add/delete positions that meet requirements
Position vacant and no cost increase
Capital Projects:
Transfer of funds between projects and new/ increased funding where conditions met

13. Board Budget Policy

14. Budget Policy Workshop Overview State Impacts due Jan. 20
Governor’s and President’s budgets provide guidance to lawmakers.
Impacts to assess:
Proposed changes to local programs and services
Estimated financial impact to local gov’ts
Impact to Sonoma County
Budget Policy Workshop
Governor’s budget released early January
President’s budget released early February
Budget Hearings
Governor’s revised budget released in May

15. Budget Policy Workshop Overview. Fiscal Policy Issues email due Jan
Budget Policy Workshop Overview Fiscal Policy Issues due Jan. 20th
Significant funding changes which require Board direction to reduce or establish new services
Establishes a new funding policy, i.e. program reserve or replacement program
Seeks a significant local discretionary funding investment
Early review of fiscal challenges and opportunities
Not the same as Program Change Requests (PCR), but may trigger a PCR

16. FY BUDGET

17. General Fund Net Cost Primer

18. General Fund Net Cost Contribution
Timeline/Sequence:
January 13: CAO to distribute initial FY GF targets to departments
Departments review calculations for accuracy
Coordinate with CAO Analyst to make any adjustments to the baseline
Departments’ assigned CAO Analyst must approve all Net Cost Target adjustments
To help facilitate departments’ review, the initial GF target file distributed to departments will be an Excel file with formulas and supporting data.
To preserve communication chain, ask Departments to send all calculation correction requests to their CAO Analyst and copy NK on their s. This will be more efficient than contacting NK directly, because too many situations arise where I need to obtain concurrence of CAO Analysts.
“Adjustments to baseline” means:
Adjusting for recurring costs that were incorrectly entered as 1x adjustments in FY 16-17, or missing position costs.
It does NOT meant to cover new positions or programs. Additional GF needed for these requests will be incorporated thru the Program Change Request approval process.

19. GF Net Cost Target Calculation
FY 16-17
Rev Bud*
Net Cost for
GF Budgets
FY Rev Bud Total Expenditures for GF Budgets
% of GF Funded Expenditures
Step 1 - Calculate departments’ FY ratio of General Fund expenditures:
The following thee slides present a graphical illustration of the GF Net Cost target calculation methodology, which is consistent with prior years.
Note: “Revised Budget” means the Board’s adopted budget thru December, which includes Q1 CBAs and subsequent PeopleSoft Adjustments.
For example, assume a fictional department has a GF section budget with total expenditures of $1,000,000. The department finances its operational expenditures with total revenues and reimbursements of $200,000 from fees and other sources, and the General Fund contributes the remaining $800,000 to balance the section budget. The % of GF Funded Expenditures would be equal to 80%.
*Note: “Rev Bud” means the Board’s adopted revised budget thru December, which includes Q1 CBAs and subsequent PeopleSoft adjustments.

20. GF Net Cost Target Calculation
FY 17-18
Est. S&B for Perm Positions
FY 16-17
Rev Bud S&B for Perm Positions
Year-over-Year Change
% of GF Funded Expenditures
GF Baseline Change
Step 2 – Calculate the prorated FY General Fund increase for labor:
Calculate the difference between FY Salary & Benefit costs for permanent positions (in Hyperion and SC Labor) and FY Revised Budget S&B costs for permanent positions.
The Year-over-Year change is then multiplied by each department’s % of GF funded expenditures to derive the prorated GF FY Net Cost Increase. As with prior year net cost calculation, the assumption is that each department’s other non-GF funding sources will also increase proportionally.
The General Fund Contribution baseline is not adjusted for:
Non-Permanent Position Costs, such as extra-help, overtime, premium/specialty pays, and payouts.
Non-Labor costs, which include everything other than Character 50 Salaries and Benefits, i.e., Character 51 - Supplies & Services, Character 53 - Other Charges, etc.

21. GF Net Cost Target Calculation
FY 16-17
Rev Bud
Net Cost for GF
FY 17-18
GF Baseline Change
FY Recurring Costs from Q1 CBAs & BOS Contingencies
FY x costs from Q1 CBAs
FY GF Target
Step 3 – Adjust for departments’ FY budget adjustments:
Finally, to pull everything together and calculate the FY GF Target:
Start with FY Revised Budget net cost;
Add the prorated increase to S&B costs;
Add any recurring expenditures added as part of Q1 CBA’s, as well as GF Contingency requests approved by the BOS that carry over into FY
Remove non-recurring FY Q1 budget adjustments.

22. S&B Assumptions Position Assumptions
Based on how position is allocated, not filled
Vacant positions = I step, K2 Medical, New Retirement Tier
Merit increases are included
Rate Assumptions (included in instructions)
Salary & Benefit Reports in SCLabor
Salary Savings

23. Internal Service Rates
Posted on the CAO’s Budget Instructions intranet site:
Rates posted as of 12/14: Worker’s Comp, ACTTC Audit Charges, Fleet, and Utility.
Rates to be posted by:
12/31/16 – Cost Plan, Liability Insurance, ACTTC Accounting Charges, HR Benefits Admin, and all ISD Rates
01/31/17 – EFS Charges and HRMS Charges

24. Requested vs. Recommended Budget
Enter into Hyperion both set of values by 3/7
REQUESTED
RECOMMENDED
Adjusted Base Rev & Exp
Adjusted Base Rev & Exp.
Values include Program Change Requests submitted
GENERAL FUND NET COST
Does not match adjusted base target, IF Program Change requires GF increase
Matches Net Cost Target

25. Operating Transfers due Feb. 24
Use of OT tool in Hyperion
Identifies correct account for budget automatically
Allows departments to balance before submission
Replaces the spreadsheet previously submitted
OT’s must be balanced across the organization before budget can be closed
Due in the OT tool before the budget is due
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC

26. Operating Transfers due Feb. 24
ISD DMP OTs
Not part of the OT tool
Will be in new OT accounts
Read only for departments
Review rate sheet provided by ISD and respond with changes before Hyperion is updated

27. Fund Balance Statements due March 7th
Available as of February 1st
Current FY beginning and ending balances based on Q1 Revised budget
ACTTC schedules cover only GF, Special Revenue Funds, County Special Districts, Debt, and Capital Projects
Proprietary Funds: Internal Services, and Enterprise are not centrally tracked
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC

28. Variance Justification due March 7th
+/-2% and +/- $50k at the Section and Character level
EFS Report (BUD007) will be available- save as Excel and enter comments.
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC

29. Narratives & Fiscal Table due March 23
Components are the same except for Strategic Planning
Strategic Planning 2017 Board Priorities and Core Principals sub-sections may be revised or deleted
Amounts listed do NOT need to match the total budget
Fiscal Table – Option to Redesign Program/Division
Hyperion verification through customized mapping
Contact CAO Analyst ASAP to meet due dates!!
Budget Changes = variance from Adopted
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC

30. Supplementals due on May 12th
Adjustments resulting from new information not available before narrative submission
Board 2017 Strategic Planning and Work plan
May include some program change requests derived from not previously known information
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC

31. Q & A
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC

32. Next Workshops 1/11 @ 2:00 PM 1/25 @ 1:30 PM
Review Internal Rates & Allocations
Development of Fees & Rates
Budget Hearing Presentation
Other??
OT Tool in Hyperion is a communication tool that makes budgeting easier
Indentifies the correct account (within a fund, between funds)
Allows the department to balance at the departmental level before submission
Spreadsheet will no longer need to be submitted
OT’s across the organization must be balanced before the budget can be closed
Out of balance OT’s lead to budget changes, so we want to balance these earlier in the process, therefore
The OT tool should be completed by Feb 24, so if there are changes, they can be made before the budget is due
Guidance as to the use of OT vs revenue/reimbursement comes from ACTTC