Council members are talking about ways for the council to be involved prior to the Mayor’s 2021 budget coming out and how to educate the public about the budget.
This is from the Common Council Executive Committee meeting yesterday where they had a discussion about the 2021 city budget process.
Here’s the video if you want to follow along or catch exactly what people said, as opposed to my cleaned up summary leaving out the useless phrases and ums, stutters and hanging sentence fragments.
PRESENTATION BY FINANCE STAFF
Council President Shiva Bidar thanks Finance Director Dave Schmiedicke and Laura Larson from the Finance Department for joining them. She says this item is before them based on the conversations they had at CCEC post 2020 budget process and interest in seeing where they can improve in the budget process. The improvements were on two main areas – community engagement and council ability to access information and data in general, as soon as possible in the budget process so there is more time to understand and participate fully in the budget process.
Bidar turns it over to Laura Larsen to talk about the proposed budget process and her memo. Bidar says every year they adopt a resolution about the budget process, it has a calendar of the budget and it has outlines of the process that we all agree upon, that is done annually. So, this conversation is an opportunity to collectively decide what we want to add or change in that resolution language for the 2021 budget.
Laura Larsen says they were looking for ways for the common council to be enegaged throughout the process. And to make sure they are sharing updated information about the outlook for the upcoming year and where they are in the general planning process. Also figuring out ways to facilitate conversations between the Mayor and the Council about different service levels and provisions and how we start to think about those items in the context of the upcoming budget.
The memo (shared with the alders on Monday) has a draft 2021 calendar
Again, this is draft, its reflective of if we followed everything exactly like it has been in the past. This outlines agency kick off through budget adoption. One thing moving to the recommendations that they offered as a starting point for the conversation:
Finance Committee Budget Briefings
- Provide regular updates at meetings of the Finance Committee on the 2021 budget process. These updates focus on the key milestones in the budget planning process (i.e. Agency Budget Requests; Updated budget outlook and budget cost drivers, etc). These sessions will also discuss the service levels and associated budget allocations.
- Sessions can be offered on a more frequent basis if requested.
- Items will be noticed as separate agenda item with relevant attachment documents.
- The Council Office will track budget concepts that may arise from city committees (e.g., Transportation Policy and Planning Board discussion of plowing arterial bike paths that was incorporated into 2020 budget through Alder amendment).
Council Budget Retreat
- If desired, a joint budget retreat with the Mayor’s Office and Common Council can be convened to review the 2021 budget outlook and discuss service levels for the 2021 budget. This session would be a deeper dive into content that will be presented during the more regular Finance Committee briefings.
Community Engagement & the Budget
Goal – Provide residents with multiple opportunities to learn about what’s in the City’s budget and how much various City services cost.
Background – Community engagement is a crucial part of the budget planning process. In recent years, Alders have consistently requested assistance for convening listening sessions in their district. The recommended approach seeks to have a coordinated effort between the Mayor’s Office and Alders to maximize the number of residents who have the opportunity to participate across the City.
Suggested Approaches
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- In-Person Sessions: Hold multiple sessions is various areas of the City co-hosted by the Mayor and Alders representing the surrounding area. The sessions will be interactive allowing residents to move to multiple booths where the City’s budget will be broken out by service. The session will conclude with a Q&A between participants and the policy makers present.
- Online Budget Simulation: Utilize the Balancing Act budget simulator to allow residents to balance the budget at home. This tool is intended to replicate the in-person sessions through an online application.
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Timeline: Sessions will be ready to take place between May & August. The online simulator can be available during same time period.
One thing they can do to foster engagement is to leverage the finance committee to have an ongoing dialogue around the 2021 budget process and use that form for a variety of different purposes that would ultimately be driven by the council perspective. Some things that those sessions could include are making sure there is an item on the finance committee agenda when agency requests have been published. Both for operating and capital. In the past, alders have been notified via email, but if they have it on the agenda it is formalizing that step and if there are questions or they want to address those in any sort of way, they can leverage the meeting to do that.
Some other topics are refining the outlook for the upcoming year through the spring and summer months as they are getting more updated information, so they are also in a position to come back and give them updated numbers. Last year they started with a $9M gap, at one point that had grown to over $11M before it was ultimately balanced in the executive budget. So thinking about ways that they have an ongoing discussion about how assumptions are changing and why.
Another option that was brainstormed was ways that council staff, Kwasi and Finance Staff can interact to be better tracking priorities of the council and alders, whether that is through various committee work or task force work, where alders may be expecting certain items to be in the budget, whether that is coming through an agency request or ultimately whether or not it is in the executive budget. There are ways that they can be tracking those things and our staffs interacting so there can be a synopsis that is going back out to alders. This item that would have been in the Economic Development Division budget is in their agency request, and figuring out how to facilitate that.
Another option, if desired, is to build on what they did last summer to have a budget retreat with the council and the mayor’s office to do some higher level planning as we move into the budget process. They want this event to be the most impactful for alders, so last year they were talking about how they think about the budget and the concepts of the citywide elements. This year we could focus more on breaking down the agency budgets into services and starting to have a different more indepth conversation about service provisions and what those things cost in the budget.
The last item in the memo is how we think about community engagement in the budget. She knows in conversations she has had with the mayor on this topic and various alders is that one of the areas they could do a better job is by making easy ways for residents to know what is in the budget and how much it costs to do different things. One concept they have talked about is thinking about joint sessions in different parts of the city with alders and the mayor, that are more educational sessions residents. Some cities have done this with a passport event where you come and can go around and learn about different pieces of the budget and what services they provide and how much those services cost. Wrap it up with a Q&A. There are lots of other ways they can structure that, with the goal of making it most impactful for what your constituents are looking for.
Every year as part of the budget process there is a resolution adopted that sets the ground rules and establishes the calendar specifically for the finance committee and council deliberations on the budget. In the past that resolution has been adopted in the July/August timeframe. It is something where if we wanted to formalize more of these concepts they could include those in the resolution and get it adopted earlier so its part of our standard operating procedure that we are working from as we gear up for the 2021 process.
QUESTIONS AND DISCUSSION FROM ALDERS
Alder Sheri Carter would like to see the resolution and the added things she talked about earlier. As much as all of us want to do things earlier, we wait until the last minute, the earlier its on the calendar, the earlier they can have the group discussions, the better the November meetings will be, we will be more prepared. She would also like to see something regarding a discussion on the levy and how the bonding rates affect cities. I think we’ve come really close to it and there is a reason why you want to have a buffer, so if you could incorporate that in there that would be really good.
ORDINANCE AMENDMENTS
Alder Grant Foster says there is another attachment on this item, its some potential amendments to chapter 4 finance ordinance that he worked on and reviewed with Dave and Laura as well. (red is inserted or crossed out language)
Draft Amendments to MGO CHAPTER 4 – FINANCE: 4.02 – BUDGET SYSTEM & 4.17 – SAVINGS RESULTING FROM USE OF GENERAL DEBT RESERVES
I. Amend sec. 4.02(2) as follows:
(2) Procedure. It shall be the duty of each department to file annually with the Finance Director, on the date they shall specify and on forms provided by the Finance Director and approved by the Finance Committee, an estimate in detail of the departmental needs for the ensuing fiscal year, including a statement of any permanent improvement to be made and an estimate of expenditures therefor, and including such information as the Finance Director may direct. The Finance Director shall review each departmental estimate and submit it to the Finance Committee and the Mayor. Upon receipt of the departmental estimates with the recommendations of the Finance Director and the Finance Committee, the Mayor shall review said estimates and recommendations and submit a proposed budget to the Finance Committee for its consideration.
II. Amend Section 4.02(6)(b) and (c) as follows:
(b) It shall be the duty of each department to file annually with the Finance Director, by the date they shall specify and on forms provided by the Finance Director and approved by the Finance Committee, an estimate of its necessary capital improvements for the following six fiscal years and estimates of the costs thereof which the Finance Director shall present to the Finance Committee and the Mayor or their designee.
(c) Capital Budget. Upon receipt of the departmental estimates of capital improvement, the Finance Director shall review each departmental estimate and submit it to the Finance Committee and the Mayor. Upon receipt of the departmental estimates and the recommendations of the Finance Director and the Finance Committee, the Mayor shall review said capital improvement estimates and submit a proposed Capital Budget for the ensuing fiscal year to the Finance Committee for their consideration. The Committee shall consider these items and recommend a proposed Capital Budget.
III. Repeal Section 4.17:
4.17 – SAVINGS RESULTING FROM USE OF GENERAL DEBT RESERVES.
In any year when general debt reserves are applied to reduce general fund debt service, an amount at least equal to the general debt reserves applied must be directly appropriated from the general fund for capital projects, unless the Common Council, by a separate vote of two-thirds (2⁄3) of all members during approval of the budget, votes to do otherwise.
He says they had a good conversation around this, he thinks these are things they could potentially include in the resolution as another way to go about it, and have them included in the budget calendar, but since it was work I had already done I wanted to share out here and get feedback on it. Basically the key points of it is to add two touchpoints with finance committee. Speaking to what Laura was talking about, the two would be 1) before the budget ask goes out to agencies, that it is brought to finance and approved before it is sent out. It’s not really his idea, it comes from the state statute and is part of the normal city budgeting process. It’s a subsection we’ve chosen not to adopt here in Madison. That would be a good way to the get council, vis a vis Finance engaged right from the beginning which really is when agencies get the ask to do the work. And 2) one the agency information comes back, it is reviewed by Finance and then put in front of the Finance Committee which is what Laura mentioned as well. Those are the two key points to the potential ordinance amendments.
The third one is sort of a different one related to the budget and he doesn’t think needs to be part of this conversation, but he wanted to share it out because he worked on all three of them with the attorney’s office. He’s very supportive of whether we do it via ordinance change, resolution, updating the calendar etc, he thinks it really important that we are engaged as a body right from the beginning and using finance committee is the right way to do that because that’s their job, so he’s supportive of doing that and he’s interested in feedback from others on it.
QUESTIONS AND DISCUSSION FROM ALDERS
Alder Kieth Furman appreciates the update in trying to get alders engaged in the process earlier. He appreciates Alder Foster’s work on the possible amendment. The thing that he fears is what is the structure for having the items come to the finance committee once the departments went through it. That information is obviously available to the entire public now. They spent 20 hours in finance this year just getting presentations from each department on their final executive budget and so his fear is how would they summarize and get that data early on and in a much rougher, much longer wish list format. How would they do that as a finance committee and what would that look like timewise. What kind of time does the city spend on putting that together and meetings.
Larsen says that is the tension we have here. There is a certain number of weeks to get this completed. What she was envisioning for the finance committee sessions to make them more manageable was . . . throughout this process we are also briefing the mayor in building the executive budget so what she was envisioning was some version of where we are in that phase of the process. If we are thinking about the operating budget, maybe the focus is around when there is major changes in the outlook. The gap grew by $2M because we got the pension numbers or whatever the case may be. And focusing it there.
Larsen says the other thing they could do in terms of working with Kwasi and the council office team is to better track the items that alders are looking for in the budget and that if there are things moving through the legislative process that may have an impact on 2021, keeping an eye on where those are in the budget process and focusing on those sorts of things. It will be a huge life to replicate what we do in the fall, in the summer. For other iterations.
Schmiedicke says that what they see in finance committee or even what the mayor sees in meetings is preceded by hours and hours of technical work to establish the base for the budget and all the positions and building those technical elements of the budgets and then the agencies are working with all of those numbers as well as what their internal priories are. What work plans are they trying to work through, over a certain span of time. He thinks you are right that that is just the tip of the iceberg, the 20 hours that you described and then there is a whole series of work products that is occurring over the months leading up to the September and October when Finance is considering the mayor’s budget.
NEXT STEPS
Bidar wants to keep summarizing to make sure she knows what to have in their resolution.
- One thing she heard consensus around is that they want the resolution to come to council earlier, as early as we can get it done and come to in the next month or so, so that they have a budget process that starts sooner.
- They want a longer process, description similar to the memo and the calendar with more details to be part of that resolution. It would be a balance of having the finance committee have more briefings but at the same time being cognizant that it cannot be the full kind of every agency potential request, but trying to come up with some executive summary of that, similar to the executive briefings that the mayor receives through the budget process. It will be less detailed than what the mayor does because she does sit in the office and spend 8 hours on the budget, like I do at work, because that is the job of the executive to do so. But it would be some high level which would allow those who have additional questions to work with the finance department to get into the weeds as they desire. And also to look at the accompanying spreadsheets of information that the department has submitted.
- Tracking proposals that have alder as leads that have a fiscal impact and are making its way so we know if they were integrated in the budget or not.
She asks if everyone is good with what they discussed for now, to have that reflected in a resolution.
Larsen says she could take these notes and write the 2021 budget process resolution, it might be a resolution with an attachment with more explanation. And she could bring that back for discussion or draft that back and forth before it gets introduced.
Bidar says they can draft it back and forth and introduce it and then it will have a process where we don’t turn the memo into whereas clauses, but use it as an attachment. Where as attached document outlines the process, so they have a document to read and not the resolution. She says they will work on it, create a draft and circulate it. She says they can decide if it comes back here for more feedback or officially introduce it and refer it here and to finance. CCEC would probably be lead. They can put a timeline on it, to introduce it on the 17th.
Larsen says that they can wrap up their work by next Tuesday and then that gives them a week and couple days to . . .
Bidar says that if they feel like they have something to be put on the agenda for next weeks CCEC for discussion they will do that. That means it needs to be done by Thursday this week, which is in two days.
Kwasi Obeng, City Council Staff says that they have been in the process of tracking and that is something they will have to work with department heads to get a sense of what is out there becuase he is not always aware of what is being proposed. That is an on-going discussion. In the future they have also had conversations about how to streamline process, like the amendment process. Other cities do have special meetings that just focus on the budget so they can just focus on that. Sometimes we might have JDS on the agenda and then do the budget hearings afterwards. So there are a lot of options they have been discussing about how to streamline the process and make it more efficient.
Alder Barbara Harrington-McKinney says starting early is absolutely on track, the tip of the iceburg is a huge lift, and from what she is hearing on committees and in the community is that is absolutely paramount and important to do. Focusing on that and getting that on our agenda and being really flat on when were going to start it and what that looks like is something that she agrees they should be moving on. The other thing she heard was having the chief of staff more integrated into the process is important, because the chief of staff serves 20 alders and at the end of the last two weeks, that is a process we can’t continue to do. We say we are not going to do it, and then we end up doing it again. Lets try to alter that intentionally and really engage the chief of staff. So please make sure you are doing that. The ordinance, she doesn’t know if we are ready for an ordinance until we understand the process we are going through. This is not a parallel consideration, she’s not sure how these two fit or if they fit.
Foster says he will explain how they fit in his mind and you can decide for yourself how they fit or don’t. What Alder Carter started the conversation with, having the council participate earlier on was my feelings leaving last budget session. As he was thinking about that, what would that look like. He did a lot of thinking about that, talking with folks, looking at our ordinance, looking at state statute and to him it was evident that really the only first official touch point was us getting the executive budget from the mayor and that seemed obviously too late in the process. This is a way to do that by changing the ordinance in terms of budget process. He met with Dave and Laura to talk about this, they had a productive conversation and talked about a lot of what you heard today, so I shared it out in this conversation to share that this is another way to go about it and also, personally he thinks putting it in a resolution for this year, seeing how it goes, making some tweaks to it makes a lot of sense. I don’t feel any need to push on an ordinance change at this point. On the other hand, I don’t think we should be afraid of updating our ordinances, and if we find its a good process then this is something we can have in mind and we can choose to put it forward and have a debate on it later on for the following year or something like that. In his mind this was part of the same conversation so he wanted to put it out there for folks to reflect on.
Bidar says she thinks its helpful. She has been on the council for 10 years and we’ve tweaked every year our budget process which is what makes me try to stay away from ordinance language which becomes very codified, because as you see new council members you see new ways of thinking. We have not hit the nirvana of budget process yet. Hopefully at some point that will happen, but she thinks they have all been working on different ways to reach those two goals. One goal is community engagement, both understanding the budget and participating in the budget process and 2) council members being able to understand and participate fully in the process from its beginning to its end. Usually in the past few years, not at 3am. She thinks those two can come together.
Foster says they didn’t talk much about the public engagement side of it, maybe they do that at a future meeting, he just wanted to react to the idea of being more educationally focused, that sounds pretty good to him. We often thing about having an exercise where people can tell us our priorities and reality that is difficult to match up with the actual decisions that are in front of us. Part of why we have a representative government is for us to do all that work. But he really does like helping folks better understand what are the tensions, where does the money go. He is very supportive of that concept and he likes the idea of doing it regionally in the city where several alders can come together on a East/West, North/South kind of basis.
Harrington-McKinney asks if they looked at the role of the chief of staff. Were those conversations how we got to this?
Foster says he had support from Karen from the office.
Obeng says that Karen was working with Alder Foster and updated me and then I had conversations with Finance as well.
Bidar tells finance staff she will be in touch tomorrow.
