Wednesday, August 4, 2010

City Council briefed on budgeting for outcomes

To a tune by John Lennon and pointed quotes City Manager Chris Morrill let economic reality seep into Roanoke City Council’s agenda Monday. Morrill only had about 20 minutes to explain “Budgeting for Outcomes” – a strategy he learned and applied while Assistant City Manager in Savannah, Georgia.

Prior to Morrill’s presentation Sherman Stovall, Director of Management and Budget and Ann Shawver, Director of Finance prepared a brief historic budget overview. Council will begin the budget strategy for fiscal year 2012 on August 30.

“We’re more program focused [in our budget cuts],” said Stovall sighting the elimination of loose-leaf collection and the closing of the Crisis Intervention Center. From FY07 to FY11 there has been a ten percent reduction in expenditures and personnel (188 positions).

The two percent increase in the meals tax rescued fiscal year 2011 from a decline of 1.18% from fiscal year 2010 to a slight but heartening increase of .3%. Real estate revenue, intergovernmental revenue, and personal property and sales tax make up for almost 75% of the city’s total revenue. Total projected revenue for fiscal year 2011 is $253.4 million.

Shawver reminded council, “though revenue has not dropped off dramatically … it becomes challenging to do things to improve our school system and add services in a time of contracting revenues.”

Roanoke’s revenue is heavily dependent on real estate taxes Though Roanoke’s real estate values have been stable compared to other localities Shawver said she “didn’t think [Roanoke was] out of the woods yet.” Roanoke trailed the beginning of the national economic downtrend and “there’s no guarantee or assurance we won’t incur a dip in that source of our revenue [in the future]” she explained. With that in mind budgeting for outcomes is a critical first step in preparing for depressed real estate values and future state cuts for localities. State lawmakers are looking at eliminating the BPOL (Business Professional Occupation License) tax. It’s 5% of the city’s budget.

Morrill picked up from that point with his presentation on how to “budget for outcomes.” He explaining that the “usual political way to handle a projected deficit is to take last year’s budget and cut it.” That way of thinking only cripples all departments. The result jeopardizes government performance and efficiency.

Through citizen surveys and focus groups services would be prioritized. The pot of money would trickle down the priority list until the funds ran out. From that point negotiations begin while still keeping in mind neighborhood vitality, culture and recreation, health and the environment, education and poverty reduction.

Focus on services not departments and don’t base assumptions on historic funding levels concluded Morrill’s presentation.

Posted By Valerie Garner

Categories: Finance, Politics, Roanoke City Politics

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