Facing Forward: The Budget is Not Just a Financial Statement

Chris Nida, NCLM Director of Research & Strategic Initiatives

It’s budget season.

Few other times in local government will carry such weight, and consequences of the resulting product can emanate far into your town’s future. It is now that you will dig into the numbers, review and maneuver state requirements, and take up perhaps the ultimate mantle of your position: financial leadership.

Whether you are elected or appointed, this budget will likely be the most important document you produce this year. Challenges abound during this time. But so do opportunities.

The budget is a chance to express your leadership. Each municipality has a statutory budget officer, but who leads the budget process can differ from town to town. In all forms of government, though, certain deadlines will need to be met. Keeping to that schedule while supporting the city staff more directly involved will result in a stronger and more robust civic organization.

The budget is a chance to display your effectiveness. The duties of local governance are difficult, and the terrain is restrictive. Regardless, the responsibilities will rest solely with town leadership. How will you navigate these challenges? The impact of your direction will be operationalized during the budget process.

The budget is a chance to prepare. It’s a forecast. Even though you will pour a great deal of time, effort, planning, and strategy into this process, the year-end numbers will likely differ from your estimates. The day-to-day practice of governing is constantly evolving and dependent on countless, ever-changing factors. It is your duty to adapt. It is your budget’s role to provide solid footing.

Most importantly, the budget is a chance to actualize your values. This process puts to paper the city’s priorities, as decided by its leadership. This is where the strength of your vision is tested. You may have a formal strategic plan, and you certainly have long-term goals. Are they a priority? Are they driving discussions? The content of your budget reveals those answers.

For a moment, flashback to your best days on the campaign trail, or your moments of anticipation before taking on an appointed position in City Hall, when ideas and optimism flourished. You entered the fray understanding the responsibilities. You were ready to take on the fiduciary duties. Perhaps more than anything, you sought the opportunity to translate your wisdom and hometown pride into hometown service.

Depending on the state of your municipality, there may be several avenues for realizing those ideas, or there may be few. Yet, there will always be the budget.

The League has resources available that you can call on during budget time. The annual revenue projection memo is produced in late March of every year and provides NCLM’s experts’ best guess of how statecollected local revenues will trend in the year to come. Quarterly revenue reports provide interim updates on those revenues throughout the year. The League surveys its members every April regarding what type of cost of living adjustments and merit increases are being budgeted for. And the League’s four Municipal Operations Consultants are former local managers and finance officials who are available to be called upon for questions and guidance along the way.

More than just a financial statement, it is the policy statement of the town. It is the strategy. It is the master plan—your declaration of your town’s intentions and goals. It is the embodiment of your leadership. Make sure it is put to good use.