In this column, Brian Kelly, Joplin (MO) assistant to the city manager, will highlight innovations in local government. He will share experiences from Joplin and cities across the country. He will look at successes and failure in innovation, and offer up some plain off-the-way ideas.
By Brian Kelly – LinkedIn and Twitter
In September, 2015 the City of Joplin became the second city in the State of Missouri to start the Priority Based Budgeting process developed by Jon Johnson and Chris Fabian with the Center for Priority Based Budgeting. When I talk about priority based budgeting with other people in local government, many of them will say, “we do that too.” While I am sure those cities budget off their priorities, I do not think there is quite another process like the one developed by the Center for Priority Based Budgeting.
Before continuing, let me make one disclaimer, these comments are made without having gone through the entire process. When we complete the process, I will be sure to write other articles.
What is Priority Based Budgeting?
Priority Based Budgeting can really be broken into three parts. The first, is the conversion of your line item budget to a programmatic budget. This involves developing a list of programs for each department. Departments then cost out each program. Program costs are the tools and supplies needed for the program as well as the staff time spent on the program, including the salary and benefits paid to the employee. In the end you are left with a list of programs broken out by department. These programs essentially tell the Council, and the public, “here are the services we provide.”
The second step involves your Council deciding what the priorities of the city are. We have just started this process in Joplin. Jon and Chris have spent time looking at Joplin’s comprehensive plan and some other internal planning documents to determine what a list of priorities could look like for the community. We are now working with Council to see what they think about that list, and to see if anything needs to be changed. There will an opportunity for the community to weigh in as well.
The third step is to rate how well, or how much, each program helps us achieve the priorities. We will then budget based off that information. If the City is mandated to provide a program, we will take that into account. For instance, the process may decide that having clean wastewater out of our treatment plants is not a priority. Well, both the federal and state government have rigid standards for clean wastewater. The trick then becomes to fund the program at the level needed to meet the mandate. We then take the incremental difference and shift that money to other programs that do help us meet the priorities of the community.
That is a very quick rundown of the process. I get more excited about this process with each step, because I think it is going to help our community tremendously.
Why Priority Based Budgeting?
Anyone who has ever tried to implement sweeping change (i.e. a new budget process) knows that people can be very leery of change. So at least a hand full of times I have been asked, “why should I go through this process?” or “is this Council’s attempt to micromanage and tell me how to do my job?” The answer to the latter is a big NO, and the short answer to the former is because the City Manager said so….. just kidding. Another question often asked is, “will my department lose its funding?”
As we go through this process, I become more convinced that it is advantageous for everyone. Whether you are a resident, member of council, the city manager, a department head or just a regular employee this is a great and innovative process. I say this because the program inventory really lays all of the information on the table. Council will now be able to see exactly what each department does and how much it costs to provide each program.
We can then have those conversations about meeting the needs of the community. The needs of the community are stated in the goals Council sets. All of the information concerning each program is there for everyone to see. When budget decisions are made, we know that it is made with all the information available. So if funding for a program is reduced, we know it is done in way that benefits the community, or that hurts the community the least.
If we are being honest with ourselves, and if we are really thinking about the needs of the community, we cannot argue against this logic, or argue against the outcome. Budgeting is never an easy process. It often involves difficult discussions and even more difficult decisions. Priority Based Budgeting ensures that the final decisions benefit the community.