Anyone— other than the “askers”— paying attention to this year’s budget process?
According to Jim Culotta, research assistant for the National Association of Counties (NACo), “The budget is one of the most important documents a county government prepares.”
I think we would all agree that the purposes and manner in which public funds are spent are matters basic to our well-being as taxpaying citizens. We’ve certainly experienced the bitter aftertaste of budget decisions, these past few years…the county having hovered in rarified air–often soaring at number one–among Minnesota’s 87 counties, when it comes to implementing the highest annual tax levy.
Therefore, I’d suggest, spending decisions are appropriate and necessary issues for debate and decision. The addition of a budget committee–one representative from each of the county’s five districts–is a commendable move in the right direction; with the caveat that participants are allowed to ask their questions, provide counsel that is actually incorporated and, basically, operate as a committee.
Regrettably, it may turn out to be nothing more than a cursory attempt to assuage growing public discontent; i.e., simply for public appearance; underscoring the very real potential for insatiable decision makers to defer or obfuscate when it comes to making budget decisions.
That is why the need for comprehensive and accurate accounting and transparent reporting becomes even more compelling.
A better-informed public should provide decision makers with incentives for transparency and accuracy in setting out spending and revenue reporting. One effective incentive can be employed during this November’s elections, when selecting who you want to represent YOU.
While there is much to learn from the relative successes or failures of other counties, I am not sure local commissioners have availed themselves of this guidance.
While some counties follow a broad range of best practices (See: September 9th, 2017 column, “A Tale of Two Counties”), others fall far short of their peers.
Many budgetary expenditures are wholly or largely discretionary, other budgeted annual operating expenditures are mandated by prior contracts, statutes, or state constitutional requirements.
In addition to identifying the difference between these expenditures, another best practice, to be encouraged, is for the county to provide detailed explanations of anticipated changes in revenue; such as PILT, Secure Rural Schools Funding, the BWCA Thye-Blatnik funds, fees for services, available grant dollars, investment earnings, etc.
Not adjusting the budget to reflect these fiscal realities would be a mistake, of course, but whether the county does or does not make such adjustments is a good indicator of the credibility of its initial forecasts.
Another essential tool to help counties weather the ups and downs of the fiscal cycle are reserve or “rainy day” funds. As American economist Paul Volcker–former chairman of the Federal Reserve under Presidents Jimmy Carter and Ronald Reagan–verbalizes it, “Much like positive general fund balances at the beginning of each fiscal year, rainy day funds contain cash purposefully set aside to help counties avoid or limit tax increases or service cuts in emergencies or in years when expenditures outstrip revenues.”
The county should have a policy (set by board referendum or other formal rule) for the use of its rainy day funds. Volcker advises, “One of the most potent indicators that a [county] is setting aside money for future fiscal downturns is a clear set of policies that dictate how the fund should work.” I believe our “policy” is at best loosely held.
“[Counties] should enact clear policies for withdrawals from rainy day and other fiscal reserves, as well as rules for replenishing spent funds and tying the size of fund balances to revenue volatility,” Volcker concludes.
In lieu of a clearly stated policy, we’ve used the topic of “reserve funds” as a political scapegoat for justifying high levy increases.
Cook County isn’t a standalone among the counties needing to re-examine how they will cope with the increasing share of their budgets consumed by services that are expanding faster than the Gross Domestic Product (GDP).
To balance budgets, counties have limited options, either increase taxes or hold down the growth of spending—or cut spending outright in discretionary areas.
This county board and administrator have demonstrated a gleeful willingness to move “discretionary” expenditures into other areas where they can hide these dollars, protected by mere semantics.
Citizens are at a huge disadvantage if it is extremely difficult, or even impossible, for them to dig out the data they need to thoroughly understand their county’s budgeting practices.
Of late, those seeking information about county operations are forced to resort to multiple phone calls, followed by onerous data practices requests for hard-copy documents.
Establishing and maintaining strong and transparent budget processes and practices should be a matter of concern for all county residents.
Budgets, as planning documents, should paint a full picture of a county’s fiscal outlook for the coming year.
And here’s some good–unembellished– advice for the county board to heed during this year’s budget process–from America’s trusted voice on money–best-selling author and radio host, Dave Ramsey: “Doing a budget means learning an ancient and powerful word: NO.”
Former Cook County Commissioner Garry Gamble is writing this ongoing column about the various ways government works, as well as other topics.
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