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Home My WebLink About1995-01-24 Finance Committee Minutes Special Budget Committee speci.al sudc�+et cca�mittee January 24, 1995 � Minutes • Cca�mittee M�nbers Present: W. Cohen, Chair, J. Tyler COUI1Ci1 �S Pre5e11t: P. Blal7Chette, C. POp�x, D. SOUC�7r C. �1111VdI1� Staff Present: E. Barrett, J. Quartararo Others Present: Sue Young, BDN Meeting was called to order at 5:15 p.m. 1. Zero-Based Bud9et;n� Coh,en opened the meeting wi.th a stateqr�nt that the tenn "zero-based budgeting" i.s a tenn of art, the.re are many scY�ols of thaught on what it means and haw it is applied. He would like to see referer�es chang�es to ��objectiv�e base b�dgeting. Barrett clistributed samples of fonns and materi.als con,cerlLiTlg the budc�+eting process that staff have dev+eloped in response to the Budgeting Ccammittee ar�r3 input of the Cauncillors. To date dQ�rr�„��nts hav+e d�veloped mission stat�nts and are workinGJ on their program structures. • CoY�n questior�d whether the prograom structures will be matclved to the mission stat�nent. Wauld lik+e to ]aiow what piece of the mi.ssion stata�nt is being filled by each program. Barrett agreed to include. When pn�r�n structures are ccenpleted, City Manager will revi�w to assure that the stat�nents are r�t too d�tailed or too broad. If a progra�t is marvdated, there will be a notation on who is mandating the program -- feds, state or G.i.ty. PoppPx c�nted tY�at having infonnation on full tiir� equivalents (FI'Es) is interesting but he is interested in tracing the whc�le person. Barrett continued that programs will be evaluated in tenns of el�mina-�on� can the service l�vel be reasonably reduce, and what i.s the prefer.red level of sexvice. An exaanple wc�uld be the elimination of fire pull box which wi.11 be proposed to Nhuiicipal Operations. Blanch,ette questior�ed wheth,�x th�re is a law or Charter recfi>;�►'r_nt to h,�ld elections on a Tuesday (elections as a mzn�dated program is included as an exa��ple in the materials review�d). Quartararo responded that elections dates for federal offices are establi.shed by federal law, the state sets the date for the state g�n�xal and special elections, and the City Chazter establishes the date for nwriicip�al. c�nexal elections. Barrett revi�aed the major e,�.nd.itures cat.egories. Cohen question the • credits and interfund transfers categories. PoppPx sugc�sted s�parating salaries and fringe costs. Barrett n,oted that if the City id,entifies 1,000 px�ograms thexe will be 5,000 to 6,000 pages of material to be . reviewed. � 2. Line-it�n Budget Popper c�nted that h,e would like to see YTD Actual FY95, and Budget 94 and Actual 94. Barrett noted that that is available through the nEw syst.�n. Quartararo cca�trented that the YTD figures are as of late Dec�nb�.r when the budget files were created. �he nudgeted files can not be updated frcgn the accounting files wi.thout copying aver the othPx budget file fields. Also, the �t files do not have the 94 budget acmunts only the 94 actual. Barrett review�d example ci�+culated. Cohen questioned what inforniation would be pravided to the Counail? Tyler suggested a chart of accaunts to fa�li.�ize the Councillors with the accounting and o�nization structure of the City budget. Po�pper questioned how a position wauld be tracl�d if it crossed division linc�G? He does not want pPxsonal identification, but does want to lax7w what a position is doing. Barrett c�nted that staff would hav+e to work on that it�n. S�illivan questior�d haw paid tiure versus rx�n-paid time (i.e.: c�nsatory time) wr�uld be reported? Barrett responded that th� City only ccanpensate • in nx�n�y. C�nsatory time wr�uld be included within the base salary. Popper questioned wY�ether CC�A would be i.r�cluded in the budget? Barrett responded. no. Cohen made favorable ccattnents about the fo�nat presented. Papp�x agreed that the fonnat i.s e�cellent. Sullivan agrees wi.th tieing the fonnat to the mission sta.te�nt. Barrett presented info�nation about th,e budg�eting process. The.re wr�uld be three phases. Phase I is program review and would i.nclude only th,e depart�nt mission stat�nts and their proc�ra¢n structure. The Council would have to respond to whether the pirogram wou.ld be pravide by Yes or No. The programs which are responded to ��yes�� would then be rank ordered. Those programs which are mandatory would be set aside and the others rank o�dered. Cohen suggested that the ranking critexia be established beforehand, and that the process be as objective as possible. Also, that Bangor Hydro has forced ranking as pzrt of their b�udget process. Barrett cantinued and noted that frcan the rankings a listing by ord�r of magnitude would be produced. Phase II is a detenmination of how �ch of the program is to be done -- what service level? Haw to do the program or service. This w�uld include a review of the program info�nation. . Cohen c�nted that this is a differ�nt approach and the Cauncil must y�et ` � out of the mind set of dpllars. He questions how tY�e Coun�cil will reach scsne dscision and worries that Colu�cil may want to say yes to e�v�rything . and then argue about the line-it�ns. Cohen c�nted that sufficient • definition must be included in the criteria to av�oid disagr�nts. Barrett ccgmiented that budget equals politics. Popper ccam�ited that City must detennine haw much it can afford. Barrett noted that mpst decisions in Phase II will be tentativ�e unti.l. 7ud9+ed ag�nGt the lin�e-itans and the final tax rate. Although he has seen it used elsewhere, c�rai].ative ranking totals to the bottcgn line c�es rvot achieve the desired outccgnes. Cohen noted that in Phase I, critical c�od judc�nt is require to rank pr-ograQris against the mission statc-�r�xit. If the progr�n does not meet the mi.ssion stat�nent it will n,eed discussion abaut cont� "n� the pirogram. Sullivan c�nted that this approach may saund like th�e Councit will be cutting the budget, but it may not cut anything after looking at the alternatives avai.lable. Barrett noted that the Cauncillors are still accountable to th�eir constituents, th�re will still be disagrearn,nts between CourLcillors ar�r3 politics is pa.rt of the budget process. Sullivan questior�ed whether tt�x� would be a stat�nent fzran th,e City Mat�ager suggesting what prograans the City shc�uld do and what grograms the City should n,ot �o. • Barrett noted that th� we� already recar�r�exx�ations fran th�e staff and m�nagex on pr�grams or services. The gresent budget represents the e,xisting service l�vels and the policy statsnents frcan the Cour�il on what services to pravide. The budget recc�nmerx3ations wi11 be based upon past perforinance and policy decisions. Staff and t1�e manager wi11 rv�t mak,e the policy decisions. Soucy ccem�ented that he has mixed feelin� abaut this process. Although he likes what has be�n put together by staff, th+e process sounds l.ik�e an ideali.stic way of preparing the b�udget. An id,ealistic and autcanated budg+et process will not w�rk. Certain programs will be provided ev+e�i if th�y do not meet th,e mission statemexit. Soucy guesti.oned wh� the effort for the change in budget came fro�n. Also, rx�ted that the City appears to be on a path with a pred,etenmined end. He questioned wh,ether th�re were grivate ac,�ndas leading this process, and whethex scgrieone was going to lead the Council dawn tY�at path? He does see an obligation to look at all programs and then get to the end and tally the budget. That approach will rwt w�rk. Council must face the real.istic political operations of the City, then discuss, d�bate and mak,e decisions. Sullivan c�nted that he haped there was no basis for concern. Blanchette c�nted tha.t she is not aware of arYy intention by arYyone to • solely cut the budget. Aftex r�viewing the programs Cauncil may c3�etP��*� ' =� that not enrnigh m4nies are being spent to maintain tl�e level of service. There is r� hidden agenda, rather this is a bare bones look at the . budget. In the e,�d the City may end up with a highex budget, but the • Cauncil will }maw what is in the budg+et. �'his is a nuts and bolts review. S�llivan c�nted that he agrees with scare of what Saucy said. In his readings in the literature mission driven budgets are the way to gn. although City can not quantify e�v+�xything. Barrett c�nted that Council could use th� cu[rnilative amouilts for new programs in the same way that it used "Abave C�rrent". Sullivan noted that this is a reasoried review of the budget, but is nat used evpxy year. This wr�uld be a stimulus to �snplayees to ccgne up with suggestions for doing away with what is obsolete. MDst savings ccxr►e frcan �nplayees and not the Council. Cohen c�nted that concerning reallocation of resources, he intuitively thinks that Public Works and Police are t�xler�located. The City has lived under maving targets for four years without a nr�d,el to follaw frcar► on�e year to the next. There are d i.fferent perspectives on how th,e budget will ccgne out. T'his i.s th,e kind of process which »�s critexia first and th,en a reality check wi.th th,e political process. � Tyler c�nted that this process will give the City the opportunity to think al�out its program and to have itwan�n�gfL d,Pbate. Line items should fall out f�can the progr�m budgets, and the programmatic appiroach will tell the Council mr�re than tt� review did last year. • Soucy responded by asking what difference c�es this all make; who is using ttbe infonmation? PoppFx c�nted that in addition to Tyler's carzr�nts, last year h,e could rwt understand what was being done. Ttbe budget cce�ar�s expenses to 2 Years prior. �'his budget review will be mpre m�n;nc�f„� , Th,e Council r�eds to p�iblicize the mission stat�nt before it is adapted ar�r3 solicit public ccam�nt. Barrett c�nted that th,e mission stat�nent is on the next Council agenda. Phase III will be the line-it�m review. In ternLs of timing, th,e Managex's line-ite.�n l�udget irn�st be sulxnitted by April lOth. Start Phase 2 in Febn�a�, and Phase II during March and April. The Phase III, l.ine-it�n review will then build on Phase I and II. Barrett questioned attendees as to whether this was a reasonable approach. Consensus was "Yes - the appiroach is reasonable". Cohen ccgnpl�nted staff with "hats off", once staff avercame its resistance it responded, and in 2 years th�re will be an even better process. Barrett responded that staff was not resistant, but was being realistic. Staff finds that it is a positive process to stop, step back and think about what the City i.s doing, and look fozwa.rd to what it should be doing. He noted that as ideas ccsrie out of th� process, they will be • brought forward for consideration. Departnients have been aslced to review th,eir revenues and begin changes through ordQxs or ordinances as soon as . possible. � • Blar�hette ccam�nted that staff should solicit id,eas f�cgn eqnplayees. Sullivan suggested that at sc.arie point there should be money rewards for ideas. Cohen c�nted that that was tried at Bangor Hyrlro and discontinued because it lead to greater mistrust of the cac�pany by e�nplayees. Cohen c�r�ented that hex�ceforth, the process should be ]mawn as Mission Based Budgeting. Adjourn+ed 6:25 p.m. John Quartararo Recording Secret�r • �