Could there be a required balanced budget every year at COH?

[trymahjong]

from Stephan Costellos enewsletter

Council Member Costello Releases New Draft 

Financial Policies  

 

March 27, 2014 - Council Member Stephen Costello released a comprehensive draft of the city's financial policies at today's Budget and Fiscal Affairs Committee. These policies aim to increase reserve funds, instill more discipline and transparency into the budget process, and include best practices as developed by the Government Finance Officers Association.

 

Highlights of the new policies include:

• Increasing the city's minimum required reserve level to 8% of annual expenditures to further hedge against risk;
• Renaming the city's Rainy Day Fund the Budget Stabilization Fund, which will now cover all emergencies, and increasing its minimum level;
• Requiring passage of  a balanced budget each year, together with a plan for a "structurally" balanced budget (one that does not rely on non-recurring revenues) for the following year;
• Financing all post-employment and employee benefit systems in a manner to systematically fully fund all liabilities;
• Properly funding the maintenance of facilities, fleet and IT in both the operating and capital budgets;
• Examining  city employee compensation and city fees every five years; and
• Disallowing spending beyond what is adopted in the annual budget without additional City Council approval.

These policies, once finalized, will be incorporated into an ordinance to include a directive to complete a cost/benefit analysis on the effects of changing the city's fiscal year start from July 1st to October 1st to better align budgeting with property tax collection.

 

In addition to budgeting and reserve policies, the draft provides greater direction in how the city handles long-term financial planning, debt management, financial reporting, internal controls and local economic development financing. 

 

"The way we currently operate financially is short sighted.  We have to save more and start tackling tomorrow's problems today. Taxpayers deserve a more transparent and balanced budget, and these are the first steps we need to take to get there," said Council Member Costello.  The last revisions to the city's financial policies were in 1989 and 2003. 

[Blue Dogs]

Gotta cut somewhere.

[Ross]

What does balanced budget actually mean?