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Week 10: Implementing and Managing Budgets

Week 10: Implementing and Managing Budgets. Complete discussion of sample BCPs Sample justifications -- (all-class exercise) Budget management vocabulary Budget management issues degree of control use of discretion flexibility and accountability Development of format for final BCP

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Week 10: Implementing and Managing Budgets

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  1. Week 10: Implementing and Managing Budgets • Complete discussion of sample BCPs • Sample justifications -- (all-class exercise) • Budget management vocabulary • Budget management issues • degree of control • use of discretion • flexibility and accountability • Development of format for final BCP • Distribute and discuss mid-term exam

  2. BCP: Commission on Improving Life Through Service • Strengths • Strong analytical basis for requested increase • growth in local programs • constant administrative budget • exhaustion of prior year carryover • evidence from privates of limits to their support • new program responsibilities • Weaknesses • some numbers with no context or benchmarks • too long and repetitive • only cited three states that receive state support

  3. Practice in Budget Justifications Case 1: Sacramento Fire Department • requests 8 additional firefighters, two new fire stations, and 6 new vehicles Case 2: CSUS -- Academic Affairs • requests two additional counselor positions for working with student in underrepresented groups to improve retention and graduation rates ---------------------------------------------------------------------------------------- Program officers: • develop rationale; make up hypothetical numbers where needed to make your case; anticipate questions from program officers Budget officers: • prepare specific questions for program officers; make sure they fully justify their requests

  4. appropriation/allocation line item control chart of accounts/acct bal. over-expenditure/deficit budget transfer budget projection year end balance carry forward supplemental approp. mandatory costs discretionary costs Budget/control language Supplemental language May Revise Audit (internal/external) one-time expenditure limited-term position sunset provision contingency reserve unallocated reduction pro-rata/across the board purchase order Budget Management Vocabulary

  5. Budget Management Issues • What are reasons for and against tight control over implementation of budget by: • legislative over executive branch? • central executive unit over agencies and departments? • What are the arguments for and against the practice of taking back funds unexpended at year end? • Relationship between management flexibility and accountability • National Performance Review: deregulation • CSUS case study: College of Business

  6. Tools for Budget Management and Control • Level of appropriation • Control over budget transfers • Line item controls, e.g. out-of-state travel • Expenditure limit approvals • Position control • Audits (fiscal and program) • Budget language/control language • Contract oversight • Reporting requirements • Analysis of budgeted v actual expenditures

  7. Case Study on County Prison Overtime Expenditures Key Points • County Commissioners controlled by Democrats • re-election prospects depend on reducing expenditures • County elected officials -- Republicans • Prison Board controlled by Republicans; controls prison expenditures Key Players • Truly, County Administrator • Dexter, Finance Director (reports to Truly) • Goodheart, Director of Corrections • Kirby, Chair of County Commission (Democrat) • Strickland, President of Prison Board (Republican) • Eager, Consultant (daughter of Republican Party County chairman)

  8. Case Study Continued--Issues and Questions Issues • the politics of administration • organizational culture: private v public • scope of conflict • budget management principles--control v delegation Questions • are overtime expenditures reasonable? • what options are available, politically, if you agree that overtime cannot safely be reduced? • was the chosen option the best one? • what should the consultant recommend?

  9. Development of BCP Formats 1. BCP Title and Brief Description of Request 2. Background/History/Problem Statement -- include prior year budget data as baseline -- data to document or quantify problem 3. Proposal/Funding Request -- include funding source, one-time v ongoing 4. Justification/Rationale/Impact -- quantify basis for request and expected benefits 5. Accountability/performance measures and objectives 6. Implications for Other State or Local Agencies 7. Analysis of Alternatives 8. Recommendation and Timetable

  10. Preview of Week 11 • Eureka Budget Simulation • Tim Hodson, Executive Director, Center for California Studies, CSUS • http://www.csus.edu/calst/Civic_Education/eureka.html • mid-term due

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