Iowa’s City Budgeting System

Patrick CallahanSnyder & 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 2a Line 4aLine 3a 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 handLocal Option Sales TaxBonds – G.O. and RevenueEnterprise RevenuesGifts/GrantsCIP Levy

Where does the other money come from? State Legislature

Authority for Property TaxesRevenue Sharing - RUTGrants Elections – LOST & Hotel/MotelSpecial Assessments

Where does the money come from? (Cont) Federal government

Revenue SharingGrants

Local governmentsCounty911 CommissionsFire districtsOthers

Where does the money come from? (Cont) Our Citizens

LicensesPermits User Fees

Swim Pool Golf course Recreation Fees

Franchise FeesFines

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 documentGREAT improvement over the

yearsGREAT resourceLet’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 ExpendituresCity department headsCity staff & finance officerPrevious fiscal year dataCity audit reports Iowa League of Cities –budget

reportUtility Providers

More Sources of Information

Estimating Expenditures (con’t) Insurance agentsVendors and suppliersConsumer price indexExisting contracts (union

contracts, maintenance agreements, leases, township and other 28E agreements)

Sources of Information

Estimating RevenuesCounty auditor –taxes & TIF Iowa League of Cities – budget

reportCity department headsCity finance officer/treasurerPrevious fiscal year

Budget Form 631 D

Budget Form 631 B

Property Tax Levies

Regular – general fund levy: $8.10 limit

Non-voted permissible leviesLiability, property & self insuranceLocal Emergency Management

Property Tax Levies

Voted permissible leviesPublic library supportBands, 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 & IPERSEmployee 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 handouts1) A completed budget2) 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 GraphsPersonnel SuppliesCapitalDebt

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 AmendmentsPRIOR TO EXPENDITURE Changes

WeatherPrioritiesPersonalities

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 handbook- Chapter 6

Iowa Department of Management Web site

City clerk’s – nearby communities and regional clerk’s meetings

Now let’s do a workout!