1. Budgeting in Minnesota A St. Cloud Perspective

2. Key Players in Budgeting - Responsibility to present budget to City Council - What role do you play? Clarify with your manager City Manager/Administrator - Details of budget  Finance - Meetings with departments – role varies

3. Key Players in Budgeting - Approves preliminary and final levy - Does your city discuss budget with Council prior to beginning budget process? City Council - Tax levy guidelines - Budget priorities

4. Key Players in Budgeting - TNT hearing required in December - Do you have forum for input earlier? Community

5. Key Players in Budgeting - Responsible to submit budget requests and to manage the budget the following year - Wants/needs always exceed funding - Do your budget instructions establish budget parameters for departments? Department Directors

6. Critical Budget Elements Tax Base Growth (Decline)

7. Critical Budget Elements 2009-2011 Budget Deficit Measures - Determine City's Primary Outcomes - Weighting of the Primary Outcomes, includes elected officials and citizen involvement - Grade services provided by all departments based upon Primary Outcomes - Prioritization of Services by Primary Outcomes

8. Critical Budget Elements

9. Tax Base Growth (Decline) - Are your budget guidelines based on tax rates or on tax levy? - How reliable is your tax base projection?

10. Critical Budget Elements Salaries - Largest cost driver - Contracts settled? Incorporate into budget - If negotiations not settled – how do you account for this in your budget?

11. Critical Budget Elements Health Insurance - Where do you get accurate estimated increase?

12. Critical Budget Elements Local Government Aid - Payment from State of Minnesota to cities based on a “needs” formula to equalize property tax between cities 2008 – 2011LGA reductions due to State budget 2014New formula and additional funding into LGA 2015Inflationary

13. Critical Budget Elements Levy Limits - Enacted by State Legislature at various times that cap the amount of levies authorized by municipalities - Debt levies are exempted from limit calculations - 2015 budget – No levy limits

14. Critical Budget Elements Revenue Projections - Estimate for non-property tax, LGA revenue - Generally not significant movement or impact on overall budget - New fees, anticipated building projects, charges for services may be significant

15. Budget Calendar – St. Cloud End of May : Timed with end of State Legislative session – yes! JuneDepartments work on budget and performance measures JulyCity Administrator and Finance Director meet with departments August4-5 Council budget work sessions SeptemberPreliminary levy adopted prior to September 30th DecemberTruth in taxation hearing Prior to end of yearCertify final budget and tax levy to county(ies)

16. City Council Meetings How does St. Cloud attempt to keep City Council discussion on the “big picture” and not mired in minutia? Council Budget Review Agenda: - Financial trend report - Budget compliance with financial policies: Budget Fund Balance Debt Service - Review of City goals - Performance measures discussion

17. City Council Meetings - Budget/tax overview - Departmental budget review - 4th and final meeting is on departments and only chance to get into the details

18. 2015 Budget Challenges - Survival budgeting of recession - Unraveling the short-term/unsustainable measures - Use of fund balance? Rating agency criteria

19. 2015 Budget Challenges What initiatives or strategies have you implemented to improve your budgeting process?

20. 2015 Budget Challenges Thank you.