Balancing Act

As the city prepares for the 2009 budget a host of issues consume our thoughts. What will fuel prices be? How much will utilities cost? What increases are expected for health insurance? How much will this or that cost next year?

Also being considered is how can we make our efforts more efficient? What things can go undone? Where can we find some savings in the cost of operations? Can the equipment we have last another year? What will the State of Minnesota do to us this year?

Also thrown into the mix is deferred maintenance. These are things like the street has seen better days, we need to do something about it. Park equipment is wearing out and needs to be replaced. Computer systems that were patched together need to achieve better interoperability and have greater security. The cable broadcast equipment is failing and patchwork replacement is difficult given the change to a digital format. More police officers are needed. Energy conservation retrofits would reduce utility costs but at a price. Different equipment would be more efficient but needs to be purchased.

And so the balancing act begins. There are short term goals and long term needs. There are levy limits for the next 3 years which keeps general levy authority in check. There are numerous “special levies” that occur outside of these limits which may cause the limits, in a general sense, to be exceeded. The point is priorities need to be exercised to do the most with what is available. Looking at all of these factors can make it difficult to weigh the benefits or detriments of various spending decisions but doing so is all part of the budget process.

The budget process takes a number of months to complete. We start in May some years and generally by June with budget worksheets and preliminary numbers. The process continues to be refined in terms of costs, revenues, projects and expenses. By mid September a preliminary levy is established and certified to the county. This amount is the maximum levy the city can exercise. After certification the city continues to look for greater efficiencies and costs that can be cut. The first meeting in December is one where we hold our budget hearing and after comments and final adjustments are made, the final levy is adopted at the second meeting in December.

All in all a great deal of time is expended in each year’s budget. The task requires a good deal of effort and consideration. The end game however is to find that balance of meeting the needs of the city while being good stewards of public funds.