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Thursday, July 18, 2013

"DATA VISUALIZATION" for Local Government: The CPBB Web-based Fiscal Health Diagnostic Tool

"The Unique Lens" is itself a product of the process as are the tech tools that have opened up a view on local government strategy, culture, management and decision-making unlike anything else!

Fiscal Health Diagnostic Tool

The most effective and affordable local government fiscal tool available

In the midst of serious fiscal challenges, it will be particularly important to stay true to the values that will carry us through these difficult times. The goal of fiscal health was established in consideration of the need to adjust the budgeting process to more effectively align resources with the City’s priorities. - City Manager’s Budget Message - City of Seaside, California

The Center for Priority Based Budgeting has seen its diagnostic approach to achieving Fiscal Health and the development and utilization of its unique and innovative “Fiscal Health Diagnostic Tool” profoundly change the conversation between local government managers, finance professionals and elected officials. These are but a few of the powerful ways Fiscal Health has been used to help local government leaders achieve long-term financial sustainability.

In 2012, Wheat Ridge City Council included the identification of core services as a top priority goal in their strategic plan. The City was already operating at a base level of service due to budget cuts implemented to cope with the nationwide economic downturn. In addition, the City continued to face a long-term lack of funding for Capital Improvement Projects (CIP). With no dedicated revenue stream to fund more than 250 million in infrastructure projects and a systemic budget shortfall, 2014 would be the final year the City could fund minimal preventive maintenance projects with a transfer from the General Fund.

The Fiscal Health Model provided a new visual tool to help facilitate budget discussions. The Fiscal Health Model allows staff to develop live scenarios to provide elected officials an instant picture of the financial impacts of their decisions. One of the more powerful traits of this process is how it has equipped Council and staff with information presented in a format that is resulting in new conversations around budget and resource allocation.

The power of the Fiscal Health Model was realized on May 19th, 2012 at the City Council’s annual
planning retreat. City Manager Patrick Goff used the model to show Council members how different

scenarios affected the City’s financial situation. Wheat Ridge has a backlog of more than $250 million in unfunded CIP projects. The Fiscal Health Model allowed staff to illustrate to Council that given the current fiscal situation, “cutting” the budget to solve the problem was not a viable option. The City needed to identify new dedicated revenue sources to ensure the success of these projects in the future.

One Council Member in particular had a very interesting reaction to this new way of looking at budgeting opportunities. Although he believes there are still ways and areas to find efficiencies to save money, he now sees and concedes to the fiscal realities the City faces. He realizes, as we all do, that no amount of reductions or cuts would ultimately solve the City’s long-term budget issues related to capital improvements.

Using the Fiscal Health Model has helped staff obtain a deeper understanding of our budget variances. Every year staff would find that our actual expenses were much lower than our budgeted amounts. Looking at these phenomena, understanding the causes, and working to eliminate them has helped staff present a more accurate picture of the City’s financial situation. The CPBB congratulates the City of Wheat Ridge, CO for their effective and innovative implementation of Fiscal Health!

Seeking clearer understanding and communication with your elected officials?

· Elected officials have adopted Fiscal Health as their preferred means of communicating with staff regarding any decisions brought before them that potentially might have a fiscal impact – asking staff to “show us” those impacts using the principles of Fiscal Health as the primary communication device.

Working through challenging conversations about compensation with staff or bargaining units?

· Organizations have entered into labor negotiations with their bargaining units using Fiscal Health as a way to quickly agree on the assumptions behind the City’s fiscal forecasts, therefore establishing a basis of trust in the discussion – then modeling the bargaining units’ requests to demonstrate impacts to the City’s fiscal position.

Weighing various financial related decisions, with complex variables, and long-term impacts?

· Fiscal Health modeling is a powerful scenario-planning tool, providing easy to understand visualization of data. It has even been used to help a Water and Sewer District prioritize capital projects, understand the ongoing impacts of those projects, and effectively develop rate increases by better understanding their ongoing and one-time sources and uses of funding in their operation.

Local governments choosing to implement the concepts of Fiscal Health as a treatment regimen are making substantial progress because they are doing the analytical work required to more accurately diagnosis the reasons behind their fiscal issues and then determining the best treatments that lead to a viable cure. Once an organization is on the road to being fiscally healthy, it can then become more financially sustainable by implementing a Fiscal Wellness regimen centered around the principles of Priority Based Budgeting.

CPBB will help you diagnose which of these flexible and attainable objectives best meet the needs of your organization and then tailor your needs to develop the level of engagement that is the “best fit” for your organization as it strives to achieve true “ Fiscal Health and Wellness”.

CPBB strives to be exceptionally cost-conscious and affordable in its work with local governments, a key reason for establishing ourselves as a mission-driven organization. We are committed to successfully meeting the goals of your community and achieving the desired outcomes of our work together.

Keep an eye on the CPBB blog for further updates and to feed the "local government high" inspired by the "Summit." Sign-up for our social media pages so you stay connected with TEAM CPBB!

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.

Sunday, February 23, 2014

Municipal "Fiscal Health & Literacy" - The CPBB Video Espresso Blast #5

"The Unique Lens" is itself a product of the process as are the tech tools that have opened up a view on local government strategy, culture, management and decision-making unlike anything else! - Center for Priority Based Budgeting (CPBB)

Local governments must be clear and transparent about what truly is their picture of fiscal health. Communicating that picture simply and clearly without volumes of numbers, spreadsheets, tables, and an endless series of charts is frankly a challenge that has plagued financial managers for years. If local governments are going to be able to demonstrate financial reality internally to elected officials and staff, and externally to residents, they have to find better ways to make fiscal situations understandable and transparent to everyone.

The key breakthrough in this area has been "data visualization" which allows for the easiest way of creating a common view, a common perspective that is simple and that everybody can agree on. Part of the reason that financial problems can be obscured or hidden is because many times decisions makers have no idea how to understand finances to begin with.

Data Visualization allows us to create a common view of the financial situation that is simple to understand and interpret, describes the clearly defined variables that can impact the financial situation, allows for "live" and "real-time" changes in these variables, and offers the ability for "dynamic" modeling of "what-if" scenarios - this is how transparency is created, and this is the essential first component of the paradigm shift required.

"Fiscal Health & Literacy" - The CPBB Espresso Blast #5

At the Center for Priority Based Budgeting, we're all about creativity and innovation in all forms.

Whether it be through expanding and improving our core concepts of Fiscal Health and Wellness through Priority Based Budgeting, migrating our Fiscal Health tool to a web-based Economic Modeling and Forecasting Tool, or finding transformative new ways to communicate how local government communities are implementing these revolutionary tools and concepts, we're never satisfied with the status quo in this "New Wave" of municipal fiscal stewardship.

With this in mind, we're rolling out the fifth of many breakthrough

CPBB Video Espresso Blast(s). The Espresso Blast is designed to provide a fundamentally new platform for the CPBB to explore innovative new trends in local government and further exhibit how CPBB communities are successfully transforming the way they deliver services and conduct business. These videos are short, concise and chock full of entertaining and valuable content.

Our first Espresso Blast, titled "How it All Started", explored the genesis of the Center for Priority Based Budgeting and the formulation of our core concepts. Our second Espresso Blast "The Decade of Local Government" dived deep into the enormous opportunities available for local government communities in this new era. Our third Espresso Blast "Resource Liberation" promotes the idea that more and more communities are finding ways to free valuable resources and re-allocate them to new and extremely important programs and initiatives.

This new video expands upon these opportunities by diving deeper into the concepts of "fiscal health" and "fiscal literacy." The CPBB has seen its diagnostic approach to achieving Fiscal Health and the development and utilization of its unique and innovative “Fiscal Health Economic Modeling and Forecasting Tool” profoundly change the conversation between local government managers, finance professionals and elected officials. These are but a few of the powerful ways Fiscal Health has been used to help local government leaders achieve long-term financial sustainability. Check out our video Espresso Blast #5 and supporting articles below!

"Fiscal Health & Literacy"

CPBB Espresso Blast #5

Supporting Articles:

The full CPBB Video Espresso Blast Archive

The New Wave - A Paradigm Shift in Municipal Fiscal Stewardship

Data Visualization for Local Government

Keep an eye on the CPBB blog for further updates. Sign-up for our social media pages so you stay connected with TEAM CPBB!

"DATA VISUALIZATION" for Local Government

Tuesday, October 13, 2015

Analyze This! ELGL + CPBB Webinar Training: Fiscal Visualization, Forecasting and Decision Modeling

"The Unique Lens" is itself a product of the process as are the tech tools that have opened up a view on local government strategy, culture, management and decision-making unlike anything else!

ELGL and CPBB are proud to partner in an innovative webinar training series, "I Want to be Your Analyst." This series, consisting of a monthly blog and training webinar, is intended to provide case studies, introductions to unique analytic tools, and expertise into the hands of all local government (emerging) leaders.

This ten part series will pair proven CPBB concepts and tools with one of our partner local government communities who are actively implementing (or have implemented) our innovative trends. This will provide key insights into how communities actually utilize these tools.

The October Training Webinar

With I Want to be Your Analyst, local government professionals will gain an introduction and key insights into the CPBB war chest of cutting-edge online tools. On October 27^th at noon PST, join ELGL, CPBB and Administrative Services Director Heather Geyer with the City of Wheat Ridge as we explore and discuss the concept of fiscal visualization, forecasting and decision modeling. Register here!

The New (Economic) Lens

Taxpayers are perhaps expecting local government to provide even more support in meeting their social, physical, environmental, and economic needs, especially with the declining assistance in these same areas from federal and/or state sources.

How does local government continue to offer the important, even vital, services required by communities in a responsive and timely fashion?

How will finance chiefs address significant debt obligations while maintaining enough resources to provide prioritized services?

What can managers do to successfully navigate these challenging waters so that their communities become better, stronger, and more relevant than ever before?

Let’s consider a completely different perspective. In order to achieve success and accept the challenges that are ahead, we must see more clearly how to manage, use, and optimize resources in a much different way than has been done in the past. This new environment demands a new vision of the future.

For managers, resources can appear to be scarce because of our tightly clenched grasp on some commonly held assumptions from which they need to break free. Perhaps there is a different way to see things. A new lens!

Case Study - Wheat Ridge, Colorado

In 2012, Wheat Ridge City Council included the identification of core services as a top priority goal in their strategic plan. The City was already operating at a base level of service due to budget cuts implemented to cope with the nationwide economic downturn. In addition, the City continued to face a long-term lack of funding for Capital Improvement Projects (CIP). With no dedicated revenue stream to fund more than 250 million in infrastructure projects and a systemic budget shortfall, 2014 would be the final year the City could fund minimal preventive maintenance projects with a transfer from the General Fund.

The Fiscal Health Model provided a new visual tool to help facilitate budget discussions. The Fiscal Health Model allows staff to develop live scenarios to provide elected officials an instant picture of the financial impacts of their decisions. One of the more powerful traits of this process is how it has equipped Council and staff that is resulting in new conversations around budget and resource allocation.

The power of the Fiscal Health Model was realized on May 19th, 2012 at the City Council’s annual planning retreat. City Manager Patrick Goff used the model to show Council members how different scenarios affected the City’s financial situation. Wheat Ridge has a backlog of more than $250 million in unfunded CIP projects. The Fiscal Health Model allowed staff to illustrate to Council, not by pointing to numbers in a budget book but by modeling the financial data, that given the current fiscal situation, “cutting” the budget to solve the problem was not a viable option.

The City needed to identify new dedicated revenue sources to ensure the success of these projects in the future. One Council Member in particular had a very interesting reaction to this new way of looking at budgeting opportunities. Although he believes there are still ways and areas to find efficiencies to save money, he now sees and concedes to the fiscal realities the City faces. He realizes, as we all do, that no amount of reductions or cuts would ultimately solve the City’s long-term budget issues related to capital improvements.

Seeking clearer understanding and communication with your elected officials?

Elected officials have adopted Fiscal Health as their preferred means of communicating with staff regarding any decisions brought before them that potentially might have a fiscal impact – asking staff to “show us” those impacts using the principles of Fiscal Health as the primary communication device.

Working through challenging conversations about compensation with staff or bargaining units?

Organizations have entered into labor negotiations with their bargaining units using Fiscal Health as a way to quickly agree on the assumptions behind the City’s fiscal forecasts, therefore establishing a basis of trust in the discussion – then modeling the bargaining units’ requests to demonstrate impacts to the City’s fiscal position.

Weighing various financial related decisions, with complex variables, and long-term impacts?

Fiscal Health modeling is a powerful scenario-planning tool, providing easy to understand visualization of data. It has even been used to help a Water and Sewer District prioritize capital projects, understand the ongoing impacts of those projects, and effectively develop rate increases by better understanding their ongoing and one-time sources and uses of funding in their operation.

Fiscal Transparency

First and foremost, local governments must be clear and transparent about what truly is their picture of fiscal health. Communicating that picture simply, clearly, and understandably without volumes of numbers, spreadsheets, tables, and an endless series of charts is frankly a challenge that has plagued managers for years. If managers are going to be able to demonstrate financial reality internally to elected officials and staff, and externally to residents, they have to find better ways to make fiscal situations understandable and transparent to everyone.

Finding creative, clear, and nontechnical ways to demonstrate what the next five to 10 years might look like is a must if people are going to address fiscal concerns. All too often, local governments are unable to make sound, timely decisions regarding investing in new resources, starting new programs, or initiating major capital projects because elected officials, local government managers, and staff members are paralyzed by the uncertainty of whether they actually have enough money to appropriate for these purposes. Developing a long-term financial forecast is key to gaining a better understanding of what the future might hold.

Next Steps

At the Center for Priority Based Budgeting, we're the first to admit we don't have all the answers. However, we do offer unique and innovative concepts and resources that allow local government communities to better understand their fiscal position and comprehensively model a multi-year variety of financial scenarios that provide options and solutions based on each individual communities unique goals and challenges (something very few municipalities perform to their detriment).

"But it's not too late to do something." And that "something," as we've previously stated in this article, is to consider a completely different perspective. In order to achieve success and accept the challenges that are ahead, we must see more clearly how to manage, use, and optimize resources in a much different way than has been done in the past. This new environment demands a new (economic) vision of the future.

For managers, economic resources can appear to be scarce because of our tightly clenched grasp on some commonly held assumptions from which they need to break free. There is a different way to see things!

Register here! October 27^th at noon PST, join ELGL, CPBB and Administrative Services Director Heather Geyer with the City of Wheat Ridge as we explore and discuss the concept of fiscal health visualization and the fiscal health diagnostic tool.

Wednesday, August 13, 2014

Curtain Call: The CPBB "New Wave" of Local Government (Un)Conference Recap

Thank you all so much for your support of the Center for Priority Based Budgeting and, in particular, our 2014 “New Wave” of Local Government (Un)Conference.

This year, we dove deep into A Revolution in how Community’s Leverage Resources! Leading the Way in Key "Result Areas" - Through the "new lens" of Priority Based Budgeting, communities have unveiled an entirely unique understanding regarding the "Results of Government" that define the very role of modern local government. The answer to the question "why do we exist" has focused on several key "Result" areas most relevant for our time.

Our goal was to have a unique event where everybody felt connected and ultimately left with unbridled enthusiasm to change the world. With attendees representing 26 states, 3 countries and two continents, having you there to participate, share your unique stories, and also learn from the innovations of other partners and implementers – it just couldn’t have struck the chord we wanted any better than that!

Thank you for adding to the experience for everybody! And hopefully you found it as exciting and valuable as we set out to accomplish.

The feedback we’ve received from those who attended has been astronomical! Here are a couple select comments:

"Just wanted to thank you again for putting this on. I don’t think that I have ever felt more connected or resonated more with the content and energy of a conference before!”

“Thanks for the opportunity to be a part of something very special this past week."

"The best gov conference I have ever attended!"

This year's conference showcased leading public and private sector innovators who are inspiring an epic REVOLUTION in local government ( You can view the full conference program here.)!

Redefining how to legitimately attain economic development and measurable local job creation through the use of incubators and partnerships
Discover new models for achieving safer communities at lesser cost
Explore revenue generation strategies attainable to every local government that have to date remained hidden
Dive into shared service models emerging to help local government redefine service levels in key public-public and public-private partnerships
Understand and digest the complex role of local government in long-term "sustainability"
Advance past "performance measurement" to reveal a new component to priority based budgeting that includes "results measurement" strategies
Grasp how credit rating agencies assess municipal credit ratings and how the transparent concepts of fiscal health and priority based budgeting can assist in stabilizing and improving bond and credit ratings
Expose your organization to the hands-on tools attainable to your community to fulfill the promise of reinventing government
Bring to light how to harvest the skill sets of the next generation of emerging leaders
Immerse yourself in the implementation strategies, shared experiences and lessons learned of the nearly 70 communities who have successfully brought the full potential of Fiscal Health and Priority Based Budgeting to their organizations

And this year, the CPBB also unveiled another NEW online tool! Many of you are already utilizing our web-based Fiscal Health Diagnostic Tool. We've seen its diagnostic approach to achieving Fiscal Health and the development and utilization of its unique and innovative “Fiscal Health Diagnostic Tool” profoundly change the conversation between local government managers, finance professionals and elected officials. These are but a few of the powerful ways Fiscal Health has been used to help local government leaders achieve long-term financial sustainability.

For many of you, this has been a long time coming. For those of you who are new to Priority Based Budgeting, and even veteran implementers, think BIG! Your path to realizing the promise of aligning ALL of your community's resources with the results that matter most, through the unique lens and disruptive local government innovation of Priority Based Budgeting, is about to get far easier and even more effective!

The Priority Based Budgeting Resource Alignment Diagnostic Tool is going web-based! Priority Based Budgeting is a unique and innovative approach being used by local governments across the Country to match available resources with community priorities, provide information to elected officials that lead to better informed decisions, meaningfully engage citizens in the budgeting process and, finally, escape the traditional routine of basing "new" budgets on revisions to the "old" budget. This holistic approach helps to provide elected officials and other decision-makers with a "new lens" through which to frame better-informed financial and budgeting decisions and helps ensure that a community is able to identify and preserve those programs and services that are most highly valued.

We've already built the basic model, but have invited leading local government priority based budgeting implementers to assist us in crafting the final product. With the launch of this powerful new public finance technology tool, we now have 8 communities already signed up to define the future of on-line local government budgeting! If your community is interested in contributing to the final development of this disruptive new tool, and being among the first to utilize on-line priority based budgeting, contact us!

Finally, we could not host this event without our conference partners, sponsors, and exhibitors. Please be sure to check out the following organizations online to discover the amazing and creative ways these folks are contributing to the “New Wave” of Local Government!

We are so excited for what the future holds in this “New Wave” of local government! And feel so fortunate to contribute, with you, to the ongoing success of all local government communities!

Keep an eye on the CPBB blog for further updates. Sign-up for our social media pages so you stay connected with TEAM CPBB!

Web-Based Fiscal Health Diagnostic Tool

Tuesday, January 7, 2014

Local Government Financial Reporting: Innovations in Economic Modeling and Forecasting!

Most state and local government entities are obligated to assemble and publish an annual financial report (AFR) once a year. Whether the report is in the form of a Federally guided comprehensive annual financial report (CAFR) or a locally guided annual financial report (AFR), these municipal AFR's generally range from 110 to 250 pages, can take up to six months to complete and are intended to identify service provisions and the fiscal position of the organization.

In December 2013, the International City/County Management Association (ICMA), in conjunction with Northern Illinois University's Center for Governmental Studies, published a white paper titled Management's Perceptions of Annual Financial Reporting. This survey sets out to not only describe "the well-known, complex state of public sector financial reporting," but more importantly to "explore management's perspectives on how the various financial statements affect management, provide a benefit to stakeholders and assist management with understanding and implementing changes to their year-end financial statements."

The Center for Priority Based Budgeting (CPBB) is in business to assist local government leaders who are seeking service excellence, transparency to their stakeholders, a strong desire to achieve long-term fiscal health and to achieve the Results that are important to their community. This financial survey is of great importance to us as we strongly advocate the importance of using municipal fiscal data in the most innovative and effective ways possible. This includes economic fiscal modeling, multi-year budgeting and providing a "picture of fiscal health" through data visualization (which allows management and elected officials to actually see and model the current and future fiscal economic health of their community).

Key Survey Results

The two key local government consumers and, coincidentally, producers of these reports are:

city/county managers and administrators
finance officers/directors/managers

These two groups are collectively referred to as "management" going forward.

For entities reporting in accordance with generally accepted accounting principles, annual financial reports offer management a comprehensive view of their finances that acknowledges economic events.

These annual financial reports are valuable resources for assessing fiscal conditions, conducting comparisons to comparable entities and integrating their other managerial roles such as capital improvements planning, budgeting, strategic planning, investing, financing, benchmarking, etc.

For the most part (64 percent), management uses little to no audited financial statements to inform their policy decisions; less than 25 percent use their financial reports to inform their policy decisions.

It is estimated that annual financial reporting costs taxpayers approximately $10k to $50k, with some larger communities spending more than $200k.

Management perceives the purpose (or key benefit) of financial statements to be for compliance and accountability, not as useful information for informing decisions.

Key Survey Recommendations

Reassess content, semantics and structure of annual financial reports. More work must be done to determine how detailed the annual financial reports should be and how the information should be defined, standardized, and structured in order to increase its use in management's decision-making. Most respondents feel that these reports are predominantly a tool for compliance. However, there is rich data in these financial statements that could be used for added input in the decision-making process.

Leverage new technologies. New technologies could lend themselves to include rich details about government's finances without all the "noise" to better articulate the meaning of what is being reported based on the audience/consumer of information. For instance, digitized financial information could allow for consolidated reporting to present the big picture but still allow for others such as tax-payers or investors to go more deeply into the data.

CPBB Observations and Recommendations

What an interesting survey! From our perspective, local government entities (for the most part) are obligated to produce some form of annual financial report. Yet after spending up to six months of staff resources and somewhere between $10,000 to $200,000 of financial resources to produce a 100+ page financial report, less than 25% of local government leaders use their financial reports to inform their policy decisions or for input in assessing future operations?

We see a tremendous opportunity here to better utilize and expand the scope and purpose of annual financial reporting so that this critical economic information can be used for forecasting and will directly tie to all significant policy decisions. And we already have the economic data visualization tools to do just that!