Tuesday, September 30, 2014

A Unique Approach to Budgeting - The Town of Christiansburg, VA & Priority Based Budgeting

A Unique Approach to Budgeting

Since late 2010, the Town of Christiansburg has been working with the Center for Priority-Based Budgeting, based in Denver, CO, on a radically different budget process that evaluates and prioritizes the programs and services provided by the town. Like so many other municipalities across the country, Christiansburg enjoyed many years of prosperous economic conditions. Most capital projects were paid for in-full and residents have long enjoyed a relatively low real estate tax rate for decades. However, the economic downturn of the past few years had a significant impact on revenues and the town found itself in a budget deficit situation.

When faced with a budget deficit, the common approach in many localities is to take “emergency-room measures,” such as across-the-board cuts, pushing back replacement schedules for vehicles and construction equipment, or implementing furlough days or even layoffs. These steps, while effective in cutting spending in the short-term, can have long-term implications on a town’s ability to provide the level and type of service citizens desire.

Developing a Process

With the above information in mind, help was sought from the Center for Priority-Based Budgeting in developing a prioritization process that could be used to help the town better understand:
  • The programs and services it provides the community
  • The true cost of providing these services
  • The best way to allocate funds as the town strives to spend within its means

This course of action is intended to help focus the town’s decision-making process by basing priorities on outcomes. The concept behind prioritization of services is that it creates an objective and transparent decision-making process, one that ensures programs of higher value to citizens (i.e., those that achieve the organization’s objectives most effectively) can be sustained through adequate funding levels, regardless of the economic conditions. This strategic approach to managing the current fiscal environment will also help insure the town’s long-term fiscal wellness.

Priority-based budgeting is a key component in the budgeting process, with Town Council and staff using its results to determine the best way to allocate available resources. In addition to assisting in the determination of what services and programs contribute directly to the Town’s overall objectives, the process also helps in evaluating any future new programs or services being considered.

Working on the Process

Work on the budget prioritization process began in December 2010, when advisors from the Center for Priority-Based Budgeting met with councilmembers and representative citizens at a public meeting. The advisors facilitated a discussion to help define and refine Christiansburg’s results, or overall objectives and strategic goals. The group first examined the Vision 2020 previously prepared by Town Council to ensure the goals in the vision were broad enough to cover the many needs and desires of the community, yet specific enough to allow for further definition. Participants then wrote down the services, amenities, and/or initiatives that went into achieving these goals for our town. (In other words, participants defined what it specifically means for Christiansburg to be, whether a “clean, healthy, safe place to live” or an “interconnected community.”) While some answers seem obvious and would be basic requirements regardless of where you live or work, the exact way in which each objective is defined by and for our town is uniquely representative of our community’s needs and desires.

After much discussion, it was determined that the town’s overall objectives should be:

Meeting Multiple Objectives

You may notice a bit of redundancy in some of these definitions. This is due to the fact that some programs, services, or initiatives offered by the town are so important, or so all-encompassing, that they help meet multiple objectives in Christiansburg’s desire to make our town a great place to live, work, and visit. For example, building and maintaining quality transportation and utility infrastructure systems is listed under “Clean, Healthy, Safe Place to Live.” However, you will also find slight variations related to transit options and mobility under “Green, Well Planned Community,” “Interconnected Community,” and “Retail, Commerce and Tourist Destination.”

Why is this? Simply stated: transportation is vital. A well planned, well built, and well maintained transportation network is necessary if Christiansburg is to going to meet all of these objectives. If you were to only list transportation issues under one objective, the others would be incomplete. As part of the priority based budgeting process, town staff also diligently worked to create an overall “inventory” of all services and programs currently provided to its citizens. The final tally included over 400 listings; from installing sewer lines in the ground to installing child safety seats in citizens' vehicles, and everything in between.

Grading Services & Citizen Input

A next step in this prioritization process involved the “grading” of the overall Town services and programs, specifically grading in terms of how each program or service rates specifically to each of the six overall Town objectives listed above. Those programs that contributed significantly to the objectives received higher “grades” than those programs that did not contribute directly. Next, the overall cost of each program was determined.

In addition to the internal work described above, the town incorporated a Citizen $100 Exercise into the process, where those who live and work in town were asked to prioritize the goals/objectives that the town is striving to achieve for the community. This citizen input was factored into the weighting of the individual goals/objectives.

View the final list of programs and their corresponding quartile listings.

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If you're thinking of jumping into the world of Fiscal Health and Wellness through Priority Based Budgeting we would certainly like to be part of your efforts! Contact us to schedule a free webinar and identify the best CPBB service option(s) to meet your organization's particular needs.


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