Presentation on theme: "Gale A. Brewer Manhattan Borough President Manhattan Community Board Leadership Development Series June 2014 New York City Budget Overview."— Presentation transcript:
Gale A. Brewer Manhattan Borough President Manhattan Community Board Leadership Development Series June 2014 New York City Budget Overview
Training Agenda 4) Role of the City Council 3) Role of the Borough Board 2) Role of the Borough President 1) Overview of the City Budget
Training Agenda (continued) 5) Role of the Community Board Budget Priorities Hearing Community Board Review of the Preliminary Budget District Needs Statements Voting on Board Priorities 6) How to Read a Budget 7) Review of the Community Board Internal Operating Budget 8) Questions and Answers
The NYC Budget is split up into the following components: Expense Budget: - The Expense Budget funds things like government salaries, pensions, and operating expenses Revenue Budget: - The Revenue Budget contains an estimate of how much money the city will take in each year in taxes, fines, fees, and state/federal grants The Contract Budget - A subset of the expense budget, includes all contractual services The Financial Plan - Released 4 times each year, and provides a multiyear perspective on city spending and revenues.
The Capital Budget -Capital funding funds physical infrastructure and equipment projects undertaken by city agencies (parks renovations, roadwork), as well as nonprofit organizations. -Capital projects must have a value of at least $35,000 for equipment purchases, and a useful life of at least 5 years. -In order for the city to fund a non-city capital construction project, there must be a minimum city contribution of at least $500,000. -There is a third category of capital spending, known as minimally-attached moveable property, where the minimum city contribution is $250,000.
The two major players in the budget process each year are the Mayor and the City Council. ROLE OF THE MAYOR: The Mayor allocates funding to all city agencies, determines the non- property tax revenue forecast for the City, proposes the Preliminary and Expense Budget each year, and negotiates with the City Council over the final adopted budget. The primary agency within the Mayor’s Office responsible for the overarching budget of the City is the Office of Management and Budget, or OMB.
ROLE OF THE CITY COUNCIL The City Council is responsible for reviewing and holding hearings on the Mayor’s Preliminary and Executive Budget, negotiating internally and with the Mayor on budget items, adopting the final budget, accepting or rejecting budget modifications throughout the year, and also making allocations to both the Expense and Capital Budget through the Member Item Process. Though much-maligned, the Member Item process provides valuable support to nonprofit organizations and city agencies in the form of small discretionary grants, as well as larger allocations generally known as Speaker Initiatives. The City Council is currently revising the way that Discretionary Funding is allocated through Rules Reform, though the exact details of the changes are not known at this time.
OTHER RESOURCES FOR INFO ON THE BUDGET 1)The New York City Council publishes all of its budget hearing reports on its website at www.council.nyc.gov 2)The NYC Independent Budget Office, provides nonpartisan information about New York City's budget to the public and their elected officials. IBO presents its budgetary reviews, economic forecasts, and policy analyses in the form of reports, testimony, memos, letters, and presentations. IBO also produces guides to understanding the budget and provides online access to key revenue and spending data from past years. You can visit them at www.ibo.nyc.ny.us
OTHER RESOURCES FOR INFO ON THE BUDGET 3)The NYC Comptroller is responsible for auditing and providing comprehensive oversight of the city’s budget. The Comptroller also oversees the 5 pension funds ($140b in assets), reviews Contracts, issues City Bonds, and more. More info on the comptroller can be found at comptroller.nyc.gov 4)There are also many other good government and advocacy organizations that provide important insight and analysis of the city’s budget process such as the Citizens Budget Commission.
OVERALL NYC AND NATIONAL BUDGET OUTLOOK Relying on the IBO (which is often more optimistic than OMB), there is a projected surplus of $833m for FY15, and a FY16 shortfall of $1.6b, which seems large but is actually only 2.9% of city generated revenues. IBO projects national real GDP growth of 3.5% in FY15, 3.2% in FY16, 2.7% in FY17, and 2.4% in FY18. IBO also projects that in NYC, job growth will increase by an average of about 1.5% over the next 5 years. Personal income will grow an average of about 5% over the next 5 years, including 5.6% in FY15 and FY16.
FY15 NYC BUDGET OVERVIEW For Fiscal Year 2015, the New York City Executive Budget is approximately $75 billion. Of that amount, approximately $48b comes from taxes, $12b from NYS grants, and $7b from federal grants. NYC allocates its budget as follows: - $15.5b is spent on health and social services (Medicaid, HHC, DOHMH, DHS, etc.) - $21.5 b is spent on education, with over $20b of that going toward the Department of Education. - $9.1b goes toward uniform services (police, fire, corrections, and sanitation) - $8.3b goes to all other agencies -$5.2b in fringe expenditures -$4.9b in debt service -$8.2b in pension costs
WHAT $10 MILLION BUYS (Statistics from IBO) -887 Head Start Childcare slots -159 new teachers -12.4 billion gallons of wastewater treated -9 fire ladder trucks -719 children receiving early intervention services -272 family shelter units in DHS -1,010 summer pool and beach season lifeguards -80 police officers per year -2 days of incarcerating the average daily prison population (12,789 inmates in city jails) -10 days of disposal of residential garbage from DSNY -1.3 million home delivered meals for seniors -65 lane-miles of resurfacing NYC streets
ROLE OF THE BOROUGH PRESIDENT IN THE BUDGET PROCESS COMMENT/ RECOMMEND/ALLOCATE
COMMENT Charter 241 Borough Board Public Hearings Manhattan Borough Board Priorities Report
RECOMMEND New York City Charter, Section 245 Borough Presidents Recommended Modifications to Mayor’s Preliminary Budget New York City Charter, Section 251 Borough Presidents Recommendations to the Executive Budget
ALLOCATE Charter 211 Initial Capital Allocations & Rescindments Charter 249 Final Capital Allocations
CAPITAL PROGRAM Capital allotment based on a formula: Landmass, Population, and the City’s total overall capital budget. The City’s total capital budget fluctuates from year to year. Amount of capital dollars also varies from year to year. PROPOSALS ACCEPTED BETWEEN JANUARY AND FEBRUARY. FY15 DEADLINE WAS FEBRUARY 27, 2014
CAPITAL PROGRAM Applicant Eligibility City Agency Non-profit with 501(c)(3) status. Project Eligibility Projects must be tangible property or other assets with a multi-year life. The cost must be $35,000 or greater. The expected useful life must be a minimum of five (5) years. Additional requirements for non-City owned entities. Project Examples Major construction or improvement projects. Stand alone purchases of major equipment The purchase or development of equipment systems
MCGP PROCESS Programmatic funding is provided to organizations that work to sustain, foster, and enhance the quality of life for Manhattan residents, neighborhoods, and communities. In FY15 we have funding in the following city agency budgets: □ Department for the Aging □ Department of Education □ Department of Parks & Recreation □ Department of Health & Mental Hygiene □ Department of Corrections Applicants must be a not-for-profit, community-based organization or a designee to serve as a fiscal conduit with such status. Funding Range: Grants start at $3,000, but award amounts are subject to funding availability. Applications for FY15 were due June 6, 2014
Cultural Tourism NYC & Company provides funding through the Borough Presidents. Funds may ONLY be used for projects that promote not-for-profit 501(c)(3) arts and cultural organizations and their events. Grant funds can be used to pay for the following: Development and distribution of cultural organization promotional materials (brochures, posters, maps, videos and slides). Special cultural events or projects supported by the Borough President and designed to bring visitors to the borough. Cultural advertising targeted to the inbound visitor market(s) Research to determine visitor profiles, identify markets or measure economic impact of cultural organizations’ tourism initiatives.
Other Grants Our office can assist community based organizations in Manhattan to find, apply for, and obtain state, federal, and foundation grants. MBPO is a local government or municipality. Our office can play several roles: MBPO as official applicant MBPO as sponsor MBPO as a supporter MBPO assists with preparation of a proposal. Repository for grants information Needs assessment
Role of the Borough Board The Borough Board: Reviews the Mayor’s Preliminary Budget. Holds Borough Board Public Hearings. Produces Borough Board Priorities Report. Borough Board is a charter mandated group that is comprised of: Community Board Chairs, the Manhattan Delegation of the City Council, the Borough President. Who sits on the Borough Board? What role does the Board play in the budgetary process?
BOROUGH BOARD BUDGET PRIORITIES REPORT Each Year, the NYC Charter requires Borough Presidents, via the Borough Board, to submit a comprehensive statement on the budget priorities of the borough to the Mayor, City Council, and OMB The Charter also requires that public notice be given to solicit input and recommendations from the public on the budget needs of the Borough. In order to comply with this requirement, an online budget priorities survey was made available from March 6, 2014 – March 18, 2014, and a public hearing was held on March 20, 2014.
This year, our office received responses from 425 individuals, representing all twelve Community Board Districts. Respondents were asked to rate a number of budget priorities in terms of their importance to the respondent, from 1-5. The following programs were identified as most important (% ranked 4 or 5 in parentheses): - K-High School Education (75%) - Affordable Housing (70%) - Public Transportation (69%) - Youth Services (67%) - Public Infrastructure (64%) - Parks (62%) - Human / Social Services (62%) - Public Health (59%) - Higher Education (58%) - Senior Services (58%) - Pre-K Education (56%) - Economic / Business Development (54%) - Homeless Services (54%) - Technology Infrastructure (47%) - Cultural Affairs (47%)
HOW CAN WE IMPROVE THIS PROCESS?
The Council establishes priorities, allocates resources and sets the policy agenda for the year. The Council has final budget approval powers. During the budget process, the Council may change budget priorities and add special "terms and conditions“ requiring city agencies to report to the Council on how specific monies are being spent throughout the year. Role of the City Council
BUDGET TIMELINE 4.Borough Presidents’ Agency Hearings – March 5 BP’s Question Agency Commissioners on Mayor’s Prelim Budget 1.Mayor’s Preliminary Budget – January Departmental Estimates, Financial Plan 2.Borough Board Public Hearings – February CB Review of Preliminary Budget, Development of Priorities 3.Borough Priorities Report – Feb/March Mandated by Section 241 of the City Charter 5.BP’s Recommended Modifications – March Mandated by Section 245 of Charter
BUDGET TIMELINE (Continued) 6.BP Initial Capital Allocations – March Section 211 Mandated Capital Project Submissions 7.Mayor’s Executive Budget – April Mayor’s Final Budget Proposal 8.BP’s Recommended Modifications to Executive Budget – May Mandated by Section 245 of the City Charter 9.BP’s Final Capital Allocations – May Section 249 Mandated Capital Project Submissions 10.Adopted Budget – June Adopted by City Council and Signed by Mayor FISCAL YEAR BEGINS JULY 1
COMMUNITY BOARD BUDGET PROCESS ACTIVITIES CONSULTATION WITH CITY AGENCIES District Consultation (local) Spring Borough Consultations (meet with Commissioners) Autumn PREPARE NEEDS STATEMENTS AND LONG RANGE STRATEGIES (to City Planning) August SUBMIT BUDGET REQUESTS (to OMB) Capital and Expense Early Nov.
COMMUNITY BOARD BUDGET PROCESS ACTIVITIES HEAR TESTIMONY AT PUBLIC HEARINGS ABOUT Budget Requests Summer/September/October Reactions to Preliminary Budget February TESTIFY AT CITYWIDE PUBLIC HEARINGS City Planning Commission: Draft of 10 Year Capital Strategy (odd years) January Borough Board February City Council Hearings March, May
COMMUNITY BOARD BUDGET SUBMISSIONS DISTRICT NEEDS STATEMENT August Describes long Range Local Issues and community Board’s Strategies CAPITAL BUDGET SUBMISSIONS by early Nov. Up to 40 Requests for Projects – with voted priorities EXPENSE BUDGET SUBMISSIONS by early Nov. Up to 25 Request for programs or personnel – with voted priorities SERVICE PROGRAM PRIORITIES by early Nov. Ranking 85 Local Programs Provided by the City STATEMENT ON THE PRELIMINARY BUDGET by Feb. 15 th Respond to Agency Budget Decisions
COMMUNITY BOARD BUDGET CALENDAR 1)June District Consultations [for next fiscal year] 2)July July 1 st, fiscal year begins. 3)Summer Submit District Needs Statement to the Department of City Planning. 4)October Borough Consultations conclude. Public Hearings held by boards By early November, submit budget requests to the Office of Management and Budget. 5)January Preliminary Budgets issued Jan 16; Register of Community Board Budget Requests Published. 1 of 2 6)FEBRUARY By Feb 15, Community Board hearings and statement on the Preliminary Budget. By Feb 25, Borough Board hearings and statement on the Preliminary Budget.
COMMUNITY BOARD BUDGET CALENDAR 8)MARCH By March 10 th, Borough Presidents Submit Modifications to Preliminary Budget. 9)APRIL April 26 th, Mayor’s Executive Budget is issued, and the Register of Community Board Budget Requests is published. 10)MAY By May 6 th, Borough Presidents submit modifications to Executive Budget. May 6 th – 25 th, City Council hearings on Executive Budget. 11)JUNE June 5 th, City Council adopts Budget. 12)JULY July 1 st, fiscal year begins; Borough Presidents may propose service reallocations.. 2 of 2
BUDGET DOCUMENTS TO HELP PREPARE BUDGET REQUESTS REGISTER OF COMMUNITY BOARD REQUESTS* EXPENSE AND CAPITAL BUDGET* CAPITAL COMMITMENT PLAN* CAPITAL PROJECT DETAIL DATA REPORT** DISTRICT RESOURCE STATEMENT AGENCY BUDGET AND SERVICE STATEMENT SERVICE DELIVERY INFORMATION (e.g., District Manager, Local service chiefs). MAYOR’S MANAGEMENT REPORT* NEEDS STATEMENT *on New York City’s website – http://www.nyc.gov **on OMB CD
District Needs and Expense / Capital Priorities - Huge opportunities for reform - Need more transparency - Need more community input - Need better data on how decisions are made
CITY CHARTER MANDATES COMMUNITY BOARDS AND CITY AGENCIES [Traditional roles in budget process are formalized] MAYOR -Consults with the Borough Presidents while preparing the Executive Budget. -As part of the Executive Budget, responds to Community Boards budget priorities (explains disapprovals). BOROUGH PRESIDENTS -Together propose budget expenditures for 5% of Capital Budget, and 5% of discretionary increases in Expense Budget. -Recommend Preliminary and Executive Budget appropriations to the Mayor and city Council. -Prepare borough’s needs statements and priorities. -Appeal Mayor’s budget decisions to the City Council. -May reallocate some agency personnel and resources after budget adoption. CITY COUNCIL -Adopts budget.
Sample of a Community Board Operating Budget Annual PS and OTPS Budget Totaling $206,895 BROOKLYN COMMUNITY BOARD 19 FY 2014 BUDGET POSITION SCHEDULE POSITION SCHEDULETitle Line No. TitleCode Pos.Annual Rate 1100 District Manager56086 1$ 78,000 1105 Assistant District Manager56087 1$ 40,000 1115 Community Associate56057 1$ 28,500 SUBTOTAL FOR OBJECT 001$ 146,500 Object 053: Amount To Be Scheduled 1153Amount To Be Scheduled – PS$ 5,000 SUBTOTAL FOR OBJECT 053$ 5,000 POSITION SCHEDULE TOTAL$ 157,500 PS OPERATING BUDGET Unit of Appropriation: 001 Personal Services Budget Code: 1000 Object Description Pos. Amount 001 Full Year Positions 3$ 146,500 021Part-Time Positions$ 17,100 031Hourly Positions$ 10,137 042Longevity Differential$ 800 051Salary Adjustments$ 4,000 053Amount To Be Scheduled $ 5,000 TOTAL PS OPERATING BUDGET $ 183,537 TOTAL PERSONAL SERVICES BUDGET$ 183,537 BROOKLYN COMMUNITY BOARD 19 FY 2014 BUDGET OTHER THAN PERSONAL SERVICES OPERATING BUDGET Unit of Appropriation: 002 Other Than Personal Services Budget Code: 1000 Intra-City ObjectAccountDescriptionAmount 10X856001Storehouse$ 750 100Supplies & Mater.$ 2,000 117Postage$ 2,500 314Office Furniture$ 2,000 315Office Equipment$ 1,250 337Books – Other$ 750 40B858001Telephone$ 3,250 403Office Services$ 1,525 412 Rentals of Misc. Equip$ 1,533 451Local Travel Expend.$ 500 600Contractual Services – General$ 2,900 602Telecommunication Maintenance$ 950 612Office Equipment Maintenance$ 1,000 624Cleaning Services $ 1,250 700Fixed Charges – General$ 500 794Training Program for City Employees$ 700 TOTAL OTHER THAN PERSONAL SERVICES BUDGET$ 23,358 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - RENT AND ENERGY BUDGET Unit of Appropriation: 003 Rent and Energy Budget Code: 4000 Intra-City ObjectAccountDescriptionAmount 414Rentals – Land, Buildings, & Structures.$ 36,232 42C856001Heat, Light & Power $ 1,528 TOTAL RENT AND ENERGY BUDGET$ 37,760
Community Board’s Operating Expense Budget $206,895 Operating BASE budget for each of 59 CB’s Excludes rent and energy funding Excludes any type of grant funding
Operating Budget Structure City Budgets allocated in units of appropriations CB’s budget have three units of appropriations Personal Service (PS) Salaries Other Than Personal Service (OTPS) Overhead costs and contractual obligations Rent and Energy Unit of appropriations have a delineation of objects codes which identify the type and amount of expenditure
How is the operating budget prepared each fiscal year? OMB sends the Community Board Current FY budget with expenditures Position Schedule of Active Employees Turnaround Document Fill-in spaces to indicate changes for next fiscal year budget MARCH MARCH-APRIL District Manager, Chairperson, and Budget Committee Re-assess the budget needs of the Community Board Review OMB documents and forecast expenditures Would the Board like to give merit increases or hire new staff? Are we going to need a new copy machine? Budget is choices! Fixed costs i.e. payroll and contracts funded first Remaining funds can be allocated at the Board’s discretion LATE APRIL Board submits turnaround document to OMB OMB processes document in FMS Integrated into the city’s Executive Budget
Can a Board make changes to their budget? Submit Budget Modification request to OMB to change PS/OTPS
Monitoring of Operating Budget Personal Services Planned Action Report Used for new hires, merit increases, salary adjustments, etc. Cash impact on current budget and out years Bi-Weekly review of payroll reports Is the Board projecting a payroll deficit? Other than Personal Services FMS prevents from overspending unit of appropriations and object codes Monthly review of object codes Rent and Energy Department of Real Estate Services (DCAS) in conjunction with OMB monitor rent and energy funding monitor rent and energy funding