Commentary on Budget Process
Foremost among the questions may be how the city can avoid the embarrassment and distress caused by a $1.7 million typo in the official budget statement that was sent to the state Local Finance Board. The repercussions at this end included shock on the part of the citizens committee and the need to find ways make up for the error on top of already 9.5 percent projected tax increase. One wonders what the state board had to say about such an egregious mistake on a document that was prepared by city auditors and approved by several top officials.
The advisory committee recommended an earlier start to the budget process, as early as February or March, for the budget year that begins July 1. Unless there is a better way of presenting budget requests of the various departments and divisions, it won’t matter how early the process starts. The committee deemed the presentations “sloppy” with good cause. Charts did not match text in the PowerPoint slides and handouts, for example. The City Council also cut two budget sessions short, leaving officials including the tax collector and fire chief sent packing after patiently waiting their turn to speak. Why waste their time that way?
Also an early start in 2009 could run afoul of the fact that the FY2010 budget spans an election year and the possible advent of a new administration. In 2005, an attenuated budget process ground to a halt in order to defer decisions to the administration that took over in 2006. In Plainfield, a Democratic June primary win generally spells success in the November general election. If a new mayoral candidate emerges in June, maybe that person should shadow the budget process at least to the same extent that a citizens budget advisory committee does.
Much of the budget work in the past had been handled by former Chief Financial Officer Peter Sepelya, who served two stints in Plainfield and knew the city inside out. Sepelya had originally planned to retire at the end of 2005, but stayed on until the end of 2007. So the city had two years to seek a new CFO. A temporary CFO was named and more recently the city hired a part-time CFO. Meanwhile, Finance Director Douglas Peck is the fifth person in three years to be in charge of the department of Administration, Finance, Health and Social Services. Peck presided over the sessions that the advisory committee found inadequate for their task. Besides City Administrator Marc Dashield, who will provide even minimal continuity if Peck goes through the revolving door?
Another consideration regarding an early start is the fact that extraordinary state aid for fiscal year municipalities is not announced until December. It was suggested that the city revert to a calendar year, but it was not spelled out how that would take place. It certainly couldn’t happen in the middle of this fiscal year. If memory serves, the option of changing to a fiscal year came from state government under the Florio administration and cities that took the option were permitted a one-time chance to use state aid for operating costs, not just for tax relief. If anyone has more details, please comment. The change required a six-month transition budget.
The city’s special charter was not amended and still indicates a calendar year schedule. Ideally, the budget should be passed within three months of the start of the budget year, but calendar-year municipalities did not get word of their extraordinary state aid amounts until July, according to online news clips. So both calendar and fiscal year budgets have a built-in six-month delay, if they seek extraordinary state aid for tax relief. Then again, given state government conditions, there may be no extraordinary state aid for anybody in 2009-2010.
The budget committee did receive orientation on the budget process. Whether it included any information on the state’s role is not known. The big budget binder provided to committee members was a city document and did not include revenues, which show up on the official budget document sent to the state (and where the $1.7 million error occurred).
All these factors deserve consideration the next time around.