AGENDA #2d

MEMORANDUM

TO:                  Roger L. Stancil, Town Manager

FROM:            Kay Johnson, Finance Director

SUBJECT:      Public Forum on the Town Budget Process

DATE:            November 6, 2006

The Town Manager appointed a staff task force to review the Town Budget Process.  The Manager charged the task force with compiling feedback and recommendations from citizens, Council and staff.  The purpose of this Public Forum is to receive citizen input on the Town Budget Process.  The Council is not requesting specific budget recommendations as a part of this Public Forum.

BACKGROUND

As Chair of the Budget Process Task Force, I worked with the Manager and staff to design a process to review and seek suggestions on improvements to the Town’s budget process for the upcoming budget cycle and for longer-term enhancements to the process.  Tim Dempsey served as a facilitator throughout the process.  Tim and I interviewed small groups of Council members to hear their insights into the budget process.  A staff task force including representatives from public safety, other large departments, development, leisure and internal services provided additional insight into the budget process, as did Town Management.  We held a combined meeting with the Council, Manager and staff task force to review the combined findings on October 25, 2006.  The process review continues with a Pubic Forum on the budget process tonight and with a report to the Council on November 20.

The process was designed to proceed quickly, so that revisions to the process could be put in place for 2007-08 budget development.  However, since the budget process is iterative, the process is open to additional improvements for the current year and future years, as Council desires.  Our goal is to evaluate the process each year, so that we can learn from our experience and continuously improve.

The Council has tentatively endorsed the following recommendations.

Recommendations and Comments

• Provide Council an annual forum for establishing a vision for the Town with supporting major goals.

Comment: While the Council has held a meeting each year to establish goals, the goals have been primarily in the area of development and land use and special projects and have not explicitly included services and facilities goals.  The plan would include making explicit: development, capital and operating goals, changes in goals and dropped goals.  The Council would like staff input on goals in a format still to be determined.

• Redesign the annual Council Retreat to improve the focus on vision and goals.

Comment:  The Council adopted a recommendation to establish an ad hoc committee to recommend a redesigned Council Retreat format.  Committee members include Council Member Cam Hill, Council Member Bill Strom, the Town Manager, and several staff members, facilitated by Tim Dempsey.  The Council considered the possibility of establishing goals in the fall, then reviewing them at the beginning of the budget process.  A recommendation was also made to consider including a vision and goals meeting in September with a review of the vision and goals in a meeting at the beginning of the budget cycle.

• Separate information on costs for new capital projects from costs related to maintaining existing Town assets, and include life cycle maintenance costs for capital projects.

Comment: The Council proposal would facilitate examining how the Town maintains its capital assets.

• Clarify project accountability and implicit trade-offs and staff costs associated with budget proposals.

Comment: Projects that cross departments would benefit from clarifying who is responsible for completion of the project and clarifying the relationship between the project and other department duties.  In addition, Council would benefit from a clearer explanation when staff needs to delay or omit one project or service in order to undertake an additional project or service.

• Provide more and better service standards and benchmarks in conjunction with budget requests and review.

Comment: The Council understands that it will take time for staff to develop improved service standards and to obtain benchmarks.  Staff has begun work on developing more and better service standards. 

• Consider meeting with advisory boards annually, outside the time for budget requests to discuss priorities.

Comments: Communication with advisory boards continues to be valued, but the Council can consider advisory board presentations at other times of year.

• Establish a Council Committee of the whole to provide year-round budget oversight.

Comment:  The Council adopted a recommendation to meet five times a year to review specific department operations or other areas of the budget to allow for increased understanding and oversight.

Other Recommendations

• Reduce formality in budget discussions between the Town Council and staff, to allow for more dialogue, taking into account time constraints.

• Develop an executive summary for budget materials, Quarterly Reports and other materials submitted to Council.  Budget materials would include reference to how requests meet Council objectives.

• Increase the focus on providing citizens with information on achievements and improvements that the Council has been able to put in place through the budget and other processes.

• Include financial management in Performance Evaluations.

• Consider extending the operating budget focus to three to five years.

NEXT STEPS

1. Provide a Budget Process Report to Council on November 20.
2. Convene Planning Group to make recommendations for Council Retreat.