MUNICIPAL BUDGETING IS HARD WORK!

Back in the 70s when I was a graduate student at Syracuse University’s Maxwell School, three of the most challenging courses for me in my politics, policy and administration curriculum were Public Budgeting, Managerial Economics For Public Administrators, And State And Local Government Finance. Not only did each have a lot of reading and homework, but I also learned that challenging courses are even more so when the professor is the author of the textbook.

Some of the lessons learned those many years ago come to mind as I observe our local budget process that we engage in at this time of year. Textbooks state that our budget is simply a plan that provides a mechanism to allocate resources for the pursuit of goals that are consistent with the community’s preferences and needs.

To complicate it, we the public want a lot, and these wants shouldn’t be confused with needs. We are willing to provide our government with our money so that the government can spend it to benefit us. I can still remember Professor Jesse Burkhead challenging us to remember to keep the theory and practice separated in our minds because financial wizards can propose a theoretically perfect budget, but the political process makes the plan a living one.

We in Chapel Hill are now at the proposal stage. Our Town Council normally holds three public forums and hearings before making decisions each spring on the annual budget, the 15-year capital improvements program, and applications for community development, housing, and transportation grants.

Tough questions have to be answered, like what services will the Town provide and at what levels, and where will the money come from. Our current Chapel Hill budget is $81.5 million. Know what’s in it? If we wanted to maintain only the items included in it, we would still have to find additional funds for next year to cover inflation. If we don’t want to raise more money, then we have to cut something just to keep pace with the prior year.

Municipal budgets are typically incremental, as we don’t start from scratch and build the budget from a zero base. Rarely do budgets decrease from year to year, so to hold steady we usually reduce spending or reduce some program or activity. Most families find themselves doing the same thing when they see that their available funds won’t cover all their needs and wants. It would be nice to be able to go to the boss and say, “Boss, I need a raise so that I can balance my budget.” I suspect most people are as successful with approach as cartoon character Dagwood Bumstead is when he repeatedly tries it with Mr. Dithers!

Governments can in fact do this to balance their budgets — the raise is called a tax increase. Local budgets must be balanced so you either spend less or get more money. I think we most often see a blend of the two but it still seems like tax increases come right regular. Since we have the occasion to participate in the process to set priorities and let decision makers know how we feel about the spending decisions and potential increases, we should take advantage of these opportunities.

For the budget that will go into effect beginning July 1, department work sessions were held in February and citizen boards and commissions also had the opportunity to provide their input. Then, the first public forum was held on January 31. The Manager will present a budget status report and hold another public forum on Wednesday, March 28. In addition to the annual budget, citizens also have the chance to comment on how we spend federal and state grant money and the components of our 15-year capital program that includes near-term priorities such as the expansion of the Chapel Hill Public Library, Parking Lot 5 redevelopment and the Southern Community Park near Southern Village.

The Manager plans to present his recommended budget on April 23. The last opportunity for public involvement will be a public hearing on May 16. The council then hopes to take its final vote on the budget on June 11.

Have you already participated in developing our plan? Do you plan to participate in the future? Do you think some of the priorities ought to be revised? Do you have some ideas on how to make our operations more efficient and effective? If you do, you should take advantage of these occasions to be heard. Having this significant opportunity to participate in the hard work of government budgeting in this manner is a good thing; translating budget theory into practice is an even better thing!



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