1. Eric R. Johnson Hillsborough County, (Tampa) FL
Recommended Budget Practices: A Framework for Improved State and Local Budgeting Government Finance Officers Association of Arizona Thursday, October 25, 2012
Eric R. Johnson
Hillsborough County, (Tampa) FL

2. Issues with the Distinguished Budget Presentation Awards Program
Focus on a document, not a process
Form over content?
How to move forward? 12

3. GFOA Strategy 1994 National Symposium
Bring together interested participants
Develop a “white paper”
What are the principles of good budgeting?
What are the barriers to good budgeting?
How to encourage best practices?
1994 National Symposium 15

4. White Paper Establish a national council on budgeting
Systematically identify best practices
Provide a mechanism to share the best practices 24

5. National Advisory Council on State and Local Budgeting
Invite all major players to participate
3 Year sunset to the Council 25

6. National Advisory Council on State and Local Budgeting
Association of School Business Officials International
Council of State Governments
GFOA
ICMA
National Association of Counties
National Conference of State Legislators
National League of Cities
U.S. Conference of Mayors
Industry, Labor & Academia

7. Results of the NACSLB
Publish framework, practice statements and examples
Develop research and sharing tools
Encourage member institutions to further roll out the results through training, tools, and techniques. 27

8. Focus on Best Practices
Intended to educate
Intended as “benchmarks”
Intended to improve capacity
Intended to promote further enhancements 28

9. Final Report issued December 15, 1997
Council work completed
Plan for dissemination
Tremendous resource
Baton passed to the major organizations
GFOA has used the results most extensively 38

10. What are the Recommended Budget Practices?
A comprehensive set of processes & procedures that define an accepted budget process
A goal-driven approach that spans the planning, development, adoption and execution phases of budgeting

11. Benefits of Recommended Practices
Helpful tool for governments seeking to improve budget process
Educate on potential of budget process
Help assess existing budgetary processes
Guidance on improving budget practices
Promote education, training, and research on effective techniques

12. Recommended, not Required
Blueprint for governments wanting to improve budget practices
Implementation likely take place over number of years
Apply to variety of management and political styles
Account for governmental differences: State/local laws, political aspects, management needs

13. Definition of the Budget Process
Activities that encompass the development, implementation and evaluation of a plan for the provision of services and capital assets.

14. Essential Features of a Good Budget Process
Incorporates long-term perspective
Establishes linkages to broad organizational goals
Focuses budget decisions on results & outcomes
Involves and promotes effective communication with stakeholders
Provides incentives to government management & employees

15. Mission of the Budget Process
Help decision makers make informed choices about the provision of services and capital assets, and
Promote stakeholder participation in the process

16. Stakeholder Involvement Vital
Involve all stakeholders: Elected officials, administrators, employees, citizen groups, business leaders
Identify stakeholder issues & concerns
Obtain stakeholder support for overall process
Achieve stakeholder acceptance of decisions regarding goals, services and resource utilization
Report to stakeholders on services and resource utilization

17. Four Principles of the Budget Process
Establish broad goals to guide government decision making
Develop approaches to achieve goals
Develop a budget consistent with goals, policies, plans, etc.
Evaluate performance and make adjustments

18. Twelve Elements of the Budget Process
Principle 1: Establish Broad Goals to Guide Government Decision Making
1. Assess community needs, priorities, challenges and opportunities
2. Identify opportunities and challenges for government services, capital assets & management
3. Develop and disseminate broad goals

19. Twelve Elements, cont’d
Principle 2: Develop Approaches to Achieve Goals
4. Adopt financial policies
5. Develop programmatic, operating and capital policies and plans
6. Develop programs and services that are consistent with policies and plans
7. Develop management strategies

20. Twelve Elements, cont’d
Principle 3: Develop a Budget Consistent with Approaches to Achieve Goals
8. Develop a process for preparing and adopting a budget
9. Develop and evaluate financial options
10. Make choices necessary to adopt a budget

21. Twelve Elements, cont’d
Principle 4:Evaluate Performance and Make Adjustments
11. Monitor, measure and evaluate performance
12. Make adjustments as needed

22. 59 Recommended Budget Practices
Procedures that assist in accomplishing principles and elements of budget process
Multiple practices usually associated with each budget element
Appropriate for all governments, all circumstances and situations
The next slide provides a sample practice.

23. Develop Policy on Use of One-time Revenues
Practice: A government should adopt a policy limiting the use of one-time revenues for ongoing expenditures.
Rationale: By definition, one-time revenues cannot be relied on in future budget periods. A policy on the use of one-time revenues provides guidance to minimize disruptive effects on services due to non-recurrence of these sources.
Outputs: One-time revenues and allowable uses for those revenues should be explicitly defined. The policy should be publicly discussed before adoption and should be readily available to stakeholders during the budget process. The policy, and compliance with it, should be reviewed periodically.

24. www.gfoa.org For detail on the 59 practices, go to
and select the link for “Budget Practices”