Understanding the Budget Process:
The City Finance Department prepares a biennial budget for Council adoption every two years. The budget, simply put, is a policy document. The document reflects and supports City Council policies and is the primary tool to accomplish their goals. The current biennial budget, adopted May 2017, for Fiscal Year End 2017-2018 & 2018-2019, is developed with a primary focus to achieve City Council’s goals established annually in January during the City Council’s Goal Setting Workshop. Departments share their accomplishments and develop objectives focused on achieving these overarching Council goals, which in January 2018 were centered around:
• Quality of Life
• Economic and Community Development
• Housing and Homelessness
• City Infrastructure
• Community and Business Relations
As projected revenues are finite, the policy decisions are how to best utilize those resources to meet the needs of the community. The budget must be built from attainable revenue projections, while at the same time identifying fair and accurate expenditures. In developing a budget, the primary component is to determine the costs associated with operating our City. Since we are a service organization (and we don’t make widgets), the primary expense is the City’s labor force serving the residents and businesses of Cathedral City. In addition, there are operating components (such as materials, supplies) necessary to better serve the Cathedral City community. In addition to the City Council, the City has five primary operating departments: City Management, Administrative Services, Community Development, Police and Fire.
We begin the analysis in January of the year the budget is prepared. For example, the six-month budget preparation cycle began for the FY 2017/2018 and FY 2018/2019 Biennial Budget in January of 2017. We start by developing estimates for various revenue and expense elements. In February, the department narratives, consisting of department goals, objectives in meeting Council goals, and department accomplishments are reviewed and updated. In addition, a draft 5-Year Capital Improvement Program (CIP) Plan is prepared. In refining the CIP, existing and new projects are identified, along with their scope, funding/expense needs, and associated timelines. In March, City Management and City Council review the budgeted revenues and expenditures. During the month of April, there are two Study Session Discussions to review the budget workbooks along with any questions from the City Council. The first session in Aprilis dedicated to the General Fund (primary financial backbone in operating the City) and the second April session is devoted to the ancillary financial elements of the budget known as the Special Revenue Funds, Internal Service Funds, and 5-Year CIP Plan. The proposed budget is then presented to City Council during the first Council meeting in May for review and the final budget is generally presented to the City Council either the second meeting in May or the first meeting in June for adoption, ensuring we meet the requirement to have an approved budget prior to the start of the City’s fiscal year on July 1st.
Principals of budgeting and financial statements of the City are governed by the Government Accounting Standards Board (GASB) and Industry requirements set forth by the Government Finance Officers Association (GFOA). The City of Cathedral City participates in GFOA’s Distinguished Budget Presentation Award program for the City’s Biennial Budget. The City has received this prestigious award for six (6) consecutive budget cycles covering the past eleven (11) years to include the FY 2017/2018 and FY 2018/2019 Biennial Budget.
Preparing the budget is a demanding and time-consuming effort for all involved in the process. This is especially true considering the competing priorities and continued workloads of staff and the budgetary challenges facing the City. ”Teamwork” among City Council, staff and our citizens and business community is the backbone to creating this policy document. This same “teamwork” continues to be an essential ingredient in Moving Cathedral City Forward.
