Iowa’s City Budgeting System Patrick Callahan Snyder & Associates July 22, 2013 Timing is everything When is it all over? When does it start? Does your City have a policy and procedure on budget preparation and monitoring? Calendar of events Example Let’s do it backwards first Schedule of Council Meetings Availability of other people such as departments, boards, committees The Time Table Count back from March 15 Copies available – 20 days prior to hearing Public hearing Start early –less stress Consult department heads Iowa League of Cities Annual mailing to help with schedules and calculations Budget Training Sessions Mentors Department of Management Ted Nellesen (ted.nellesen@iowa.gov) Web Site Department of Management DOM Information - website County Auditor Information Taxable valuations – calculate levies Assessed valuations – G.O. Debt limit TIF valuations and projections (go to www.dom.state.ia.us) Line 3a Line 2a Line 4a Line 2B Line 3b What is your process? City Administrator/Manager? Budget Committee Citizens Council Other taxing agencies County Community School Community College Extension Offices Area schools State Council – FINAL DECISION Who will put it all together That be you! Isn’t that in the small print? Need a Quarterback City Council’s Goal Setting Session Capital Planning (more later) Does it tie to the Council’s goals How far out? 5 years-10 years? Funding sources Cash on hand Local Option Sales Tax Bonds – G.O. and Revenue Enterprise Revenues Gifts/Grants CIP Levy Where does the other money come from? State Legislature Authority for Property Taxes Revenue Sharing - RUT Grants Elections – LOST & Hotel/Motel Special Assessments Where does the money come from? (Cont) Federal government Revenue Sharing Grants Local governments County 911 Commissions Fire districts Others Where does the money come from? (Cont) Our Citizens Licenses Permits User Fees Swim Pool Golf course Recreation Fees Franchise Fees Fines User Fees - Utilities Water Sewer Storm Sewer Electric & Gas Garbage Cable TV/Internet Other Sources Gaming revenues Refunds Interest on investments Rent or sale of property Go to the source Budget Excel document GREAT improvement over the years GREAT resource Let’s see-- Line Item Budget-Workpapers Program – department or service List of expenditures Previous fiscal years Current budget year Year-to-date numbers Proposed budget Adopted budget Where Does the Money go? The Nine Programs State Budget Forms – Iowa DOM (Partial List – Most common services) Public Safety Services Police/jail Fire Animal control Emergency management Flood control Public Works Services Streets and bridges Parking Street lights Traffic control Snow removal Street cleaning Health & Social Services Health regulation inspection Water, air and mosquito control Cultural & Recreation Library Museum, band and theatre Parks Recreation Cemetery Community center Community & Economic Development Community beautification Economic development Planning & Zoning General Government Mayor, Council, and City managers Clerk, Treasurer and finance Election Legal services City hall Tort liability Debt Service Principal payments Interest payments Bond registrar fees Capital Projects Construction/building projects TIF capital projects (or as Special Revenue fund type) Capital Equipment (now allowed in this area as per GASB 54) Business Activities/Enterprises Water Sewer/wastewater Landfill/garbage Cable TV/Internet Storm sewer The Types of Funds General Special revenue- LOST, RUT, TIF, employee benefit levies Debt service Capital projects Permanent Enterprise Non-budgeted funds (internal service) Budget Form 631 E P1 Budget Form 631 E P2 Budget Form 631 A P1 Budget Form 631 A P2 Municipal Expenditures Personal services – salary & benefits & related expenses Services & commodities Capital outlay Debt payment & interest Transfers The Budget Numbering System (City Clerk’s Handbook) Revenues –fund, function, type & source Expenditures – fund, function & object Sources of Information Estimating Expenditures City department heads City staff & finance officer Previous fiscal year data City audit reports Iowa League of Cities –budget report Utility Providers More Sources of Information Estimating Expenditures (con’t) Insurance agents Vendors and suppliers Consumer price index Existing contracts (union contracts, maintenance agreements, leases, township and other 28E agreements) Sources of Information Estimating Revenues County auditor –taxes & TIF Iowa League of Cities – budget report City department heads City finance officer/treasurer Previous fiscal year Budget Form 631 D Budget Form 631 B Property Tax Levies Regular – general fund levy: $8.10 limit Non-voted permissible levies Liability, property & self insurance Local Emergency Management Property Tax Levies Voted permissible levies Public library support Bands, vocal CIP Levy Property Tax Levies (con’t) Ag Levy – $3.00375 Limit Special revenue levies Emergency – (if at $8.10) Police & fire retirement (411) FICA & IPERS Employee benefits (as defined by Administrative Rules) Property Tax Levies (con’t) SSMID Debt service levy Capital project levy (voter approved) Budget Form 635.1 Budget Form 635.1 (bottom) Fund Balance Reminders Council Resolution Check audit reports Annual financial report Budget Form FBW The “Fine Art” of Balancing the Budget Reduce expenditures Increase revenues Spend down cash resources City staff recommendations City Council – ranking City Council – final decision The appeal process - $8.10 Watch calendar requirements for appeal The Public Hearing Process Budget forms completed Prepare notice of public hearing & budget estimate Publication 10/20 day rule Copies available – 20 days prior to the hearing Budget Form 631.1 Go to the handouts Two different handouts 1) A completed budget 2) Line item budget workpapers Are we done yet? No Now we need to make it understandable. Graphs Summary of various items Newsletters Public meetings What kinds of graphs? Category Graphs Personnel Supplies Capital Debt Historical What does this year look like compared to prior year(s) Newsletters Introductory letter with major items What projects will be included in the next year(s) Any major changes in personnel, programs or facilities? Budget Form 635 2A Finishing up Certification Resolution E-filing to DOM Submission to GFOA? Take a vacation you deserve it Finishing up Then monitor it all year long Monthly reports to the Council Actual to budgeted Cycles for expenditures and revenues The Budget Protest Budget is the backbone of City Finance It is the plan It is the guide It is the control And then there are amendments Budget Amendments PRIOR TO EXPENDITURE Changes Weather Priorities Personalities It is still the plan It is still the guide But it is the law! Due May 31 Resources & Training Iowa League of Cities- budget report Iowa League of Cities – budget workshop Iowa handbook for city clerks & finance officers –Chapters 7, 11 & 14 Resources & Training (con’t) Iowa policy leaders handbookChapter 6 Iowa Department of Management Web site City clerk’s – nearby communities and regional clerk’s meetings Now let’s do a workout!