Posts Tagged ‘priority based budgeting’

No organization of any size operates without a budget.  The budget serves as the main record of a plan of action.   For most organizations it includes more than just numbers but also a description of initiatives meant to drive the mission forward.  You can NOT find a CEO or Board of Directors of any corporation who would not agree with the above.

In governments, it’s perhaps even more important.  The budget serves as the legal check and balance over the spending of the executive branch. It provides the mechanism by which the legislative branch controls the executive. Because of this budgets, could be said to be a core of our democracy.

Organizations and governments that fail to budget, fail, which brings us to Trenton.

Trenton’s fiscal year runs from July 1 to June 30^th.  However, in recent memory the city has not operated with an approved budget before March.  Trenton fiscal year 2015 budget was approved today, March 24^th.  That’s three quarters of the way through the year.  We’ve already spent three quarters of our money without an approved budget.  The money that has been spent was spent with an approval process that has less rigor than a formal review complete with public input.

Our budget and therefore our city are adrift and what’s worse NO one in the Administration or City Council seems particularly upset about it.

The Law Director explained why it couldn’t be done any sooner.  The City Clerk gave some additional reasons.  Basically they are saying that Trenton MUST always and for all time operate without a budget.   The democratic process will apply to only one quarter of the year.  We will remain adrift.

I can’t accept that and call on The Mayor to fix this problem.

• We may need to seek new State laws. Surely there would be support for allowing struggling cities to have budgets.  The Clerk suggested that we need to change our type of school system vis a vis the State, well OK, maybe we should.
• We may need to make guesses about State funding. That’s why they call it a budget.  All budgets bake in uncertainty, I fail to see the difficulty in this.  The Clerk suggested we not be dependent on the State.  Perhaps, but that’s like wishing for world peace.  Meanwhile we can budget with only an estimate of State funding.
• We may need do things in parallel. The City Clerk told me that we couldn’t start work until an audit that takes six months is complete.  I challenge that notion.  Surely Department Directors can prepare their materials and citizens and Council can review and voice their priorities while that is happening.
• We may have to start work on the 2016 budget NOW. We have only three months until fiscal year 2016 begins.   I fail to see why the administration and public can’t agree on priorities and contingencies in advance of July 1 so that shortly after the year begins, Council can begin voting.  The voting should be the last and most inconsequential part of the process to paraphrase fellow activist Kevin Moriarty.

Several years ago, during the unfortunate Tony Mack administration, I, along with a small band of fiscally minded citizens, formed a group called Fix Trenton’s Budget.  Among other things, we researched, developed and presented a new budget process to the Administration and City Council called Priority Based Budgeting.  Other cities around the country use it to good effect.   It was heavy on public participation, analytic thinking by Departments and timelines.  We held public budget education forums and even collected budget priorities from the forums and over the Internet.    It went nowhere because the Mack administration and City Council were happy to operate with no real bounds or public input.   Let’s hope that is NOT the attitude of this Mayor.

We have it ready to re-introduce to Trenton should the Mayor ask us.

We hope that this Mayor will help re-install the good government and transparency that comes from operating under an approved budget.  We hope that we can budget not just for the months of April, May and June but that he will consider the other nine months of the year as also being important in moving Trenton forward.

Priority Based Budgeting Process (from 2012)

This report was produced by The Fix Trenton’s Budget Committee and is reposted here
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As part of a broad Priority-Based Budgeting exercise initiated jointly between the Fix Trenton’s Budget Committee, Beautiful Trenton and Trenton Council of Civic Associations with support from The City of Trenton, an in depth survey on budget priorities has been conducted amongst city residents.

Over the last four months 202 Trentonians have completed a comprehensive budget survey either participating in person at Ward budget forums or online through a specially designed survey tool. The survey was unique in that it used actual budget numbers and asked respondents to make forced choices between taxes and spending increases or decreases in levels of service. For instance, if citizens wanted to increase the number of police on the street they had to either increase their own property tax or reduce service in other areas such as recreation or public works. It mirrored the tough choices elected officials have to make when balancing the budget.

“This is the first time such a large and in-depth survey of Trentonians has been conducted about the budget and how their tax dollars are spent”, said Carlos Avila of Fix Trenton’s Budget. He added,
“Other cities such as Philadelphia and San Jose, CA have successfully used citizen input like this to help make hard choices in spending.”

By holding forums in familiar neighborhood locations, each sponsored by a City Councilperson, the organizers were able to reach a large cross section of Trentonians. In addition, the web based survey allowed a broader response. Our sample size of 202 was enough to provide 95% confidence that our results were representative of the 37,479 registered voters in Trenton with a 7% margin of error for each answer. Nevertheless, we hope to every year improve the methodology of this exercise and attract more participation from residents.

We’ve tallied the results and found that Trentonians favor lower spending. Of the $92,000,000 in departmental spending included in the survey, respondents voted to trim the amount by $7,000,000 to $85,000,000, a reduction of 7%. The total city budget for 2011 is $205,490,000 which also includes debt payments and benefits. The survey showed that Trentonians expected this savings to result in an 8.5% decrease in property taxes or roughly $400 per $100,000 in assessed value.

The following chart shows the weighted results of departmental budgets if left to all 202 respondents.

In particular Trentonians favored less spending in the following areas.
The following chart shows the percentage of respondents who voted to increase, maintain or decrease spending by department.

Perhaps as a hint of dissatisfaction with the current political climate, 64% of the survey takers favored reducing the administrative budget which includes the Mayor’s salary, his aides and City Council. However this cut amounts to only $1,000,000. Respondents also voted overwhelmingly to withhold pay raises for city employees.

Survey takers put Fire and Police spending under pressure as well. A surprising 38% of respondents favored decreasing Fire spending and only 7% voted for an increase. Trenton Police did a little better with 35% supporting reduced police protection and 15% hoping for increases. This is significant as Fire and Police make up one quarter of Trenton’s total city budget. While roughly half of the survey participants voted to keep spending the same, the downward pressure on spending is at odds with the administration’s past priority of maintaining current levels. The study shows that the recent realization that budget levels may have to be reduced will not meet as much resistance as expected. According to comments in the survey, the “4 on, 4 off” police scheduling policy was unpopular among respondents.

Public Works showed weak support as 42% of survey participants wanted to decrease spending while only 13% favored an increase. Health and Human services also had weak numbers with 49% of respondents calling for a decrease. Several respondents commented that the County should take over Health and Human Services.

Several departments attracted pleas for increased investment.

Inspections and Economic Development received support for increased budget by 32% of respondents. This is attributed to the belief that spending in this area will lead to increased levels of investment in the city and better quality of life. Many respondents wrote in comments such as “limit affordable housing to 20% of total”, “Kill off the Miller Homes project”, “We need more market rate housing” and “Focus redevelopment in a few areas”.

A substantial 31% of survey participants favored reopening all of the Library branches. However, 51% were OK with just the main branch being open and just over 17% favored closing down the entire library system. Similarly, 39% of respondents favored increases in Recreation spending and 11% favored eliminating the department.

In addition to concerns about departmental functions, respondents left a large number of other comments about the budget.

Survey participants seemed anxious for a new relationship with the State “The state should pay its fair share” was a popular sentiment. Others felt that Trenton should “discontinue police protection in the State House district”.

Respondents were not short on additional ideas for raising revenues. Parking taxes and improved violation enforcements topped this list. Privatizing trash collection and charging more for pick-up was a popular idea. Trentonians especially wanted to tax non-residents by way of “commuter taxes” and increased fees on non-resident landlords. Enforcing laws was also seen as sources of income through fines for loitering, increase court fines and using drug seizure money for community benefit. Other ideas included running a Police Academy for profit, an entertainment tax, a wage tax on non-profits and selling the Marriott.

The results of this survey are illuminating. They show a willingness to sacrifice but more importantly show that Trenton residents have specific priorities in how they would like their government to invest its scarce resources. Both the Mayor and City Council have supported this effort so Fix Trenton’s Budget and Trenton citizens look forward to the incorporation of these results in the 2012 budget.

Written for the May 2011 issue of the Trenton Downtowner
In a democracy citizens get to rule themselves. We elect representatives who are responsible for doing our bidding. The theory of this republican form of government is great; however there’s often a disconnect.

We forget that democracy was invented thousands of years ago when governments were smaller and simpler. That changed as Trenton and the rest of America became part of a national and global economy.

We didn’t keep up and now one of the great challenges of our age is reinventing post-industrial cities like Trenton.

Why should we expect our leaders to know what’s needed to turn Trenton around? They haven’t done it in the last 20 years. Instead we have declined in population and lost ground in income. Perhaps the collective wisdom of voters could provide better insights.

You might say, “They don’t listen”. Well perhaps we haven’t delivered a clear message.

Unfortunately most citizen input is undisciplined. Everyone wants everything: libraries; more state aid; more development and less crime. Governments and our economy don’t work like that. There are no magic wands.

We have to use our budget as a strategic instrument of revitalization policy. It’s not enough just to reduce the budget. It needs to be used wisely to further our goals of investment, safety and standards of living.

We need to balance investment in livability (safety, trash pick-up and social services) with investment in the future (lower taxes, improved technical inspections and marketing.)

We can’t just wait for a revitalization savior to show up in Trenton. Instead, we can leverage the wisdom of the masses to help make the tough choices that political leaders can’t make themselves. Priority Based Budgeting provides an opportunity to do exactly that in Trenton.

A group of fiscally minded Trentonians organized the Fix Trenton’s Budget Committee to work on efforts important to revitalization. One of those efforts is a budget process that includes citizen input as its driving force. Led by Carlos Avila and Bob Lowe we got the Mayor’s and City Council’s support to do this starting in the fiscal 2012 budget (beginning July 1, 2011.)

With Beautiful Trenton and the Trenton Council of Civic Associations and council members: we held community input meetings. To make sure we collect as much input as possible, we’ve put the survey online and will keep it open through May.

The output of the surveys will form the basis of a position paper for city council that will communicate its budget guidelines.

The Priority Based Budgeting process allows citizens to present their own budgets. People’s priorities are different. Some want lower taxes (we have the highest tax rate in NJ). Some want more services. Others want more investment. We all want these things but we have to balance the budget and now voters can make the same tough choices as our leaders.

We’ve prepared a survey that presents the budget in a simplified form. We ask you to vote on discretionary items. These include our tax rate and the department spending which directly impact the levels of service that can be provided. We held the items that are beyond our control like state funding, debt service, employee benefits, grants etc constant.

Choices include two or three reasonable levels of spending and several different tax levels. Dollars are converted into points that make the math easier. But the spending has to equal the income.

The budget survey can be found at FixTrentonsBudget.org. This is our first year using this process and we look forward to continuous improvement.

In addition to the budget survey, there’s also a questionnaire asking for your opinion on new revenue enhancing ideas. For your convenience there is also a Spanish version.

It’s our budget and we all have to be responsible for it. If we don’t do it, who will?