UWF Public Budgeting Model Research Paper

Running Head: BUDGET ORGANIZATION AND DESIGN

The Organization and Design

of

Budgeting Function, Budgeting System Components

and

Related Financial Management Techniques

for

Brevard County

Carlos F. Tobar

University of West Florida

Author Note

Email: [email protected]

BUDGET ORGANIZATION AND DESIGN 1

Abstract

This paper begins with a short review of the Michel and the National Advisory Council

on State and Local Budgeting (NACSLB) recommended budget practices for a public

organization. Brevard County in Central Florida, home of NASA, cruise ship terminals and a

unique natural environment, was chosen for budget analysis because of the major financial

challenges it has faced in recent years. The paper will describe and analyze the county’s budget

and compare it to the recommended budget practices. Finally, exceptions to the budget

practices, and reasons for them, will be reviewed.


Short Review of Budgeting Concepts and Models

Michel

Although Michel writes about the vital functions of the budget office for small and large

governments including states, this section will focus on the concepts for large agencies and

budgets like Brevard County’s. A budget office has increasing levels of responsibility ranging

from the most basic function of coordinating the budget process to policy guidance and finally to

supervising the actual implementation of the adopted budget (Michel, 2002, p. 11). A budget

office prepares and controls the operating budget. Michel (2002) states that a budget office that

is the focus of the organization and relates to all departments within it has the following budget

office activities: (a) Program Evaluation, Performance Measurement, and Management Analysis;

(b) Intergovernmental Relations; (c) Grant Management; (d) Financial Management Information

Systems; (e) Capital Budget Preparation and Control; (f) Financial Policy Development; (g) Data

Analysis; (h) Long-Term Financial Planning; (i) Revenue Forecasting and Analysis; (j)

Employee Position Control (p. 12).

The naming of the budget office, its place in the organization and its assigned activities

will vary based on the size of the organization (Michel, 2002). At the larger organizations,

typically, the budget office will reside in either the Chief Executive Officer or a separate

department that reports to a subordinate of the Chief Executive Officer.

National Advisory Council on State and Local Budgeting (NACSLB)

The NACLSB developed a framework for state and local governmental agencies

consisting of 4 principles and 12 elements to improve budgeting practices (NACSLB, 1999).

The first principle is to establish the goals that will steer the legislature. The first principle’s first

element requires assessment of the community’s needs, priorities and unique challenges. The


second element calls for government to assess its programs, services, assets and management

systems. The third element requires development and dissemination of the goals to the

stakeholders.

The second principle requires the agency to implement policies, practices and procedures

to help achieve its goals. The fourth element requires development of financial policies to ensure

financial obligations are met. The policies must include instructions to stabilize revenues, fee

adoption, debt management, emergency management, recurring and one-time revenue sources.

The fifth element requires operational and capital policies and plans. The sixth element consists

of policies and plans to deliver programs and services, capital acquisition, maintenance,

replacement and disposal. The seventh element calls for management strategies to ensure

operational and financial goals are attained.

The third principle requires the budget to align with goals. The eighth element consists

of implementing a budget process that adopts a budget calendar, guidelines, instructions and

policies for budget submissions, budget coordination and budget review, budget feedback and

budget modifications. The ninth element requires development of short- and long-range

operating and financial plans that consider revenue forecasts and options to fund proposed

capital projects. Because most governments are financially constrained, the tenth element

involves presenting a budget that aligns with the legislature’s vision and adopted goals.

The fourth principle requires evaluation of the organization’s performance, and

mechanisms to be in place to make the required adjustments for the present and future. The

eleventh element requires the agency to measure, monitor, and evaluate the budget on a regular

basis. The twelfth element requires adjusting, if necessary, the adopted budget, adopted policies,

programs or services, strategies and goals (NACLSB, 1999, pp. iii-iv).


Description, Analysis and Comparison of Brevard County Budget

Budget Process

During the information age governments have an unprecedented amount of tools

available to them to gather input from citizens. However, the government and its politicians

must be willing to allow that information flow. It is of no value to a citizen to have internet

access, but not have a picture, physical address, email address or phone numbers to communicate

with government staff and politicians, or minutes to meetings. Some public organizations’

websites are instructive. For example, the Jacksonville Transportation Authority has photos of

the board members but no information on how to contact them. The CEO, Michael Blaylock, is

listed, but, again, not his contact information. There is no organizational chart. There is no

department head or employee listing, no agendas, no minutes from recent meetings and no

archives of past agendas or minutes (JTA, n.d.). Brevard County, on the other hand, lists each

commissioner, his or her photo, phone number, fax number, email address and physical address.

Additionally, the county displays prominently on its website the County Commissioners tab, the

organizational chart, the department heads and their phone numbers. The county budget has its

own separate tab on the home page of the website. The county’s website also has archived

agendas and minutes from 2010 forward. The commissioners, as some stated in the March 18,

2010 budget workshop, communicated with thousands of residents during their campaigns.

These commissioners and government employees can be approached anywhere they go, at their

offices, board workshops and board meetings in addition to electronic means which encourages

stakeholder input (Brevard County, 2010). It is not surprising that in 2012 Brevard County’s

website won the Sunshine Award for exceeding transparency standards (Brevard County, 2012).


For Brevard County, the communication from the public was a key factor in establishing

broad goals to guide its decision-making. Brevard County, located in Central Florida, has had to

face difficult challenges since 2008 when the homestead exemption was approved by voters, and

later when the housing downturn caused both property values and property tax revenues to

decline. That led to the 7% decline in property tax values in FY 2008 followed by reductions of

12%, 13% and 12%, respectively, for fiscal years 2009, 2010 and 2011. Further reductions of

17%, 10% and 7% are projected for fiscal years 2012, 2013 and 2014, respectively (Brevard

County, 2011). The national economic downturn has caused a trickledown effect from the

national government to states and local governments and from the states to local governments

thereby handing local governments unfunded mandates and increased responsibilities. Increased

unemployment has created more demand for social services including an increase in Medicaid

spending. Brevard County, faced with the same challenges as every other community in the

country, has had to endure also the shutting of NASA’s Space Shuttle program which is based at

the Kennedy Space Center in Cape Canaveral. Furthermore, the unique natural environment in

Brevard County poses restrictions on its capacity to address fiscal challenges. Brevard County

has the highest concentration of salt marsh mosquitoes on the eastern seaboard. Addressing the

threat of mosquito-borne diseases is a yearly battle. Brevard County is also required to fund

mandated constitutional officers which restrict fiscal flexibility even further. The last point to

make about Brevard County’s fiscal challenges is the Board of County Commissioners’

reluctance to raise taxes which has made it incredibly challenging to balance the budget of a

billion dollar organization (Brevard County, 2010).

One theme that will emerge from Brevard County’s budget analysis is that two processes

are proceeding simultaneously: (a) the development of the current year budget, (b) development


of strategic and long-term plan. The purpose for the two-pronged approach came as a result of

its property tax valuation projections through FY 2015 (Brevard County, 2011). When the

property appraiser sounded the alarm of drastically reducing property tax revenues in early 2010,

the commissioners directed the County Manager, Howard Tipton, to maintain the aggregate

property tax rate, the millage, at its FY 2009-2010 level (Brevard County, 2010). This is the

backdrop for the development of the budgets for FY 2010-2011 and FY 2011-2012. This

principal directive helped guide the decisions, some of which were unprecedented and

controversial, in the subsequent two years.

On March 18, 2010, Howard Tipton brought in Arrington-Marlowe, LLC to encourage

the Board of County Commissioners to develop a strategic plan. Arrington-Marlowe had

experience dealing with the State of Florida’s financial crisis in the early 1990s and advised the

board of the importance of setting a course for the near future. The theme of his message was

that conditions would never return, especially property tax collections, to what they once were.

The board had to prepare for a new future that meant a new baseline for Brevard County—a new

baseline that included more people, more responsibility, increased costs, but decreased tax

revenues. Howard Tipton informed the board of his intent to hold numerous public meetings to

disseminate the information to employees and the public of the current financial crisis and the

recommended changes to the budget. The broad goals for the county were to maintain the same

level of taxation, provide mandated services, life and safety services and library services.

Howard Tipton and his staff immediately addressed the board’s directive to maintain the level of

taxation. Because the reduction of revenues was going to lead to budget cuts, and the likelihood

of bargaining unit employee layoffs was high, Howard Tipton informed the union that he

intended to come before the board to declare a fiscal hardship on July 22, 2010. The declaration


was necessary, in advance of preparing the final budget and millages, because county

management needed time to negotiate the subject of furloughs, and possibly other concessions,

with the county’ labor union (Brevard County, 2010). Overall, the county has done an

outstanding job of meeting the goals of elements one and three of the NACSLB model (1999).

Brevard County set a high number of public and board meetings to disseminate the

message for the two fiscal years analyzed. In total the board in 2010 held 16 board workshops

and meetings addressing the budget including one e-town hall meeting. At the e-town hall

meeting Florida TODAY’s Government Editor, Don Walker, asked questions from residents who

submitted to the newspaper their questions over a two-week period. All of the commissioners,

Howard Tipton, his two assistants and the county budget director were in attendance. The board

subsequently adopted the final budget and set the millage rate in September 2010 (Brevard

County, 2010).

During the FY 2011-2012 budget process, the county set meeting dates for another e-

town hall meeting and another meeting in the City of West Melbourne on August 16, 2011 in

addition to the board workshops, meetings and public hearings. On February 10, 2011, which

was the beginning of the FY 2011-2012 budget process, Brevard County introduced its strategic

plan and adjusted its broad goals, which satisfies NACSLB standard for level 12.3-adjusting the

broad goals (Brevard County, 2011; NACSLB, 1999). Its strategic objectives were to (a) fulfill

mission requirements, (b) increase customer satisfaction, (c) expand community outreach, (d)

improve effectiveness, (e) improve efficiency, (f) improve employee engagement, (g) increase

workforce development, (h) meet financial and budgetary requirements (Brevard County, 2011).

Of the fifteen stated sustaining initiatives to meet their strategic objectives, several of them were

in conflict, at least temporarily, to their objectives of increasing customer satisfaction and


improving employee engagement. The first initiative was to reduce the size of government, the

third initative was not to create new positions and the fourth was not to introduce new programs

and services. As was seen beginning in FY 2010-2011, this led to increased wait times for

building permit approvals, increased wait times on phone calls and increased response time to

animal bites and other decreased levels of service, and was a concern for many residents at

budget workshops in 2010 (Brevard County, 2010-2011). The second initiative was to maintain

current salaries and not provide cost-of-living increases. Further complicating matters was the

state’s decision to require a 3% retirement match from all employees participating in the Florida

Retirement System (FRS) in FY 2011-2012 (State of Florida, 2011). Although this did not affect

the county’s budget, the county had to be concerned about the effect on its employees’ declining

wealth. In FY 2010-2011, in addition to the salary/wage freezes, employees contributed $10

million towards its health care costs which was to be an ongoing requirement, 6 furlough days

for regular employees, or 12 furlough days for the management class. The county’s FY 2011-

2012 adopted budget, seven months after the initial board workshop, did include a one-time

2.5% increase in wages and salaries. Another initiative that was discussed briefly at the

meetings was revenue enhancement. The initial discussions pertained mostly to the feasibility of

increasing user fees (Brevard County, 2010).

One of Brevard County’s complexities is that it really operates several “businesses”

which have the same revenue source, ad valorem or property taxes, but have their own millages

or property tax rates and restrictions. Brevard County has two options to affect revenues for a

department: (a) increase or decrease General Fund transfers, (b) increase or decrease millages.

Although transfers to and from the general fund are permitted, transfers between the special

funds are not. Brevard County has 21 operating tax districts or “businesses” and 6 long-term


debts which are all funded by the property taxes. Included in the 21 operating tax districts are

the General Fund, Library District, Mosquito Control District, Fire Control, several recreation

districts, the airport, environmentally endangered lands, and all five Road and Bridge districts,

which have the same boundaries as the commissioner districts. Each operating tax district

millage must be approved separately by the board at the time the budget is adopted (Brevard

County, 2010).

Once Brevard County’s management staff received its directive to maintain the millages

at current levels and after it received its projected revenue, county management staff went about

the task of balancing the budget, a state requirement, by ensuring expenditures met revenue

projections. As we will see in the financial policy section, Brevard County had to reduce its

projected property tax revenue, statutorily, by 5% to meet State of Florida requirements. In FY

2010-2011 some departments and constitutional officers saw virtually no change in their budgets

compared to the prior year; however, departments that have minor capital projects in their

operating budgets specifically Public Works and Parks and Recreation, bore the brunt of the

budget cuts. Of special note, Parks and Recreation increased their FTEs by 6 employees, but

they reduced FTEs by 50 in FY 2009-2010. In FY 2011-2012 Housing and Human Services saw

a reorganization and a drastic reduction in the Housing program because of expiring grant

funding, but the rest of the budget cuts, just like in FY 2010-2011 were due largely to

maintenance and minor capital deferrals, and reductions in capital investments. Parks and

Recreation deserves a special note in FY 2011-2012. Their budget was reduced by a whopping

$121,000,000 or 59% of their final FY 2010-2011 budget. This amount represents nearly half of

all the cuts in FY 2011-2012 compared to the final adopted budget for FY 2010-2011. Of that

amount, $81 million was a reduction in debt payments. They also eliminated 15.75 positions. In


FY 2011-2012 the Planning Department’s budget reduction was mostly in grants to others

(Brevard County, 2011).

The Capital Improvement Plan (CIP) is a five-year plan that is adjusted yearly. The bulk

of the revenue, roughly a quarter of the county’s annual budget, is generated from ad valorem

taxes that were approved as part of referendums by the voters. The revenues for CIP projects are

allocated mostly to Facilities, Natural Resources, Parks and Recreation, Solid Waste and Public

Works Departments. The aggregate amount of the CIP projects for each department is included

in each individual department summary of the budget. The summary of revenues and

expenditures include operating and capital costs. Each CIP budget for each department is listed

separately in its own section of the County Budget website tab. The details of each of those

projects are found there (Brevard County, 2010).

Brevard County meets the NACSLB standards for level 8: (a) staff developed a budget

calendar; (b) the board gave guidelines to staff; (c) department heads provided individual budget

requests to the budget office; (d) staff developed the mechanisms--board workshops, board

meetings, e-town hall meetings, public hearings--to coordinate budget preparation and review;

(e) staff identified opportunities for stakeholder input. All stakeholders were invited to

participate at all these meetings and the minutes from these minutes reveal the high level of

interest in the proceedings. The level 9 standards are almost met: (a) long-range financial

planning was accomplished in FY 2011-2012 by developing the strategic plan; (b) capital

revenue projections were provided through 2015; (c) property tax valuations were analyzed

through 2015; (d) declining revenues and reluctance to increase the aggregate millage meant

base-level services would be affected either through elimination, or decreased levels of service;

(e) increased user fees were considered; (f) consensus was reached on the projected revenues; (g)


revenue sources were identified easily in the budget; (h) expenditures were projected; (i)

department heads and senior level county administrators reviewed expenditure options; revenue

options, other than user fees, were not discussed since the board had already stated their

reluctance to increase taxes; (j) a CIP was developed (Brevard County. 2011; NACSLB, 1999)

Budget Document

The Brevard County budget document, as to be expected with numerous “businesses”

within the business, is a consolidation of individual budgets. Each department and constitutional

office has its own budget. The Brevard County budget office prepares the document and

provides a color-coordinated pie chart with the various revenue sources in one pie chart and the

various expenditure categories in the second pie chart. The budget summaries all contain the

same categories. For operating revenues, the following consolidated line items are shown: (a)

taxes; (b) permits, fees, special assessments; (c) intergovernmental; (d) charges for services; (e)

fines and forfeitures; (f) miscellaneous; (g) statutory reduction. For non-operating revenues, the

following line items are displayed: (a) balance forward, (b) transfers from general revenue, (c)

transfer from others, (d) other finance sources. For operating expenditures the following line

items appear: (a) compensation and benefits, (b) operating expenses, (c) capital outlay, (d) grants

and aid (to others). The non-operating expenditure categories are: (a) CIP, (b) debt service, (c)

Reserves-operating, (d) Reserves-capital, (e) Reserves-restricted, (f) transfers to others. Each

department and constitutional office provides in the summary the following: (a) mission

statement, (b) programs and services, (c) trends and issues, (d) major service level impacts, (e)

budget analysis, (f) program changes, (g) goals, (h) major accomplishments for the preceding

fiscal year, (i) initiatives for the coming fiscal year, (j) performance measures which align with

the board’s strategic plan. The Adopted Budget Message document cites major trends and


challenges and a short-term, but not a long-term financial plan. The Budget and Financial

Policies document contains all the financial policies that guide budget development. The Budget

Philosophy and Strategic Framework document contains the method of accounting the county

utilizes: modified accrual and accrual basis of accounting. Recommended budget summaries,

prior to budget adoption, are uploaded to the website for public review. The summaries for FY

2012-2013 are already on the website. They provide neither revenue and expenditure line items

for operating and non-operating categories, nor the pie charts, but the total budgets for all

departments and the CIP are listed. For fiscal years 2010-2011 and 2011-2012, both budgets

were adopted on-time. Since Brevard County is not introducing new programs, its focus has

been on reviewing existing services. Brevard County meets all the NACSLB standards for levels

6, 7.3 and 10 with the exception of providing a long-term operating financial plan (Brevard

County, 2011).

Financial Policies

Florida Statutes. Under the County Budget heading on the website’s home page,

Brevard County lists its financial policies. The first policy is Florida Statute, Chapter 129 which

guides budget development and policies. The statute requires (a) the fiscal year begin October 1,

(b) a balanced budget, (c) reserves for various accounts, (d) the budget exclude 5% of projected

revenues from operating revenues, (e) balances be recognized and carried forward, (f)

commissioners to appoint a budget officer, (g) the budget officer to submit a tentative budget

within 15 days of receiving certification of property values, (h) the budget to regulate

expenditures, (i) the budget document to state whether modified accrual or accrual basis of

accounting is utilized, (j) the budget to be amended, if necessary, within certain parameters

(Brevard County, 2011).


Florida Statute, Chapter 200 guides property tax revenue generation policies. Brevard

County is responsible for assessing and collecting property taxes not just for itself, but also for

municipalities and special districts. Additionally, voters in the past may have elected to tax

themselves further and those rates, millages, are included in the total tax calculation. Once the

county’s property appraiser has certified property values, agencies have 35 days to submit their

proposed tax rate which cannot exceed 10% unless approved by a referendum. Within 55 days

after the values are certified or within 10 days of tax roll approval, the property appraiser will

issue the proposed tax rate. Each taxing authority only has 65 days after values are certified to

hold a public hearing of their proposed budgets and millage rates. Each taxing authority is then

required to publish an advertisement for one final public hearing to review the final budget and

millage rate (Brevard County, 2011).

Board of County Commissioner Policies. Brevard County has had long-standing

budget and financial policies. The current policies were approved on February 7, 2006 and have

been reviewed annually. For FY 2011-2012 a few minor changes were made to policies on April

19, 2011 but nothing substantial to affect the review of the county’s budget and financial policies

(Brevard County, 2011). Because the policies encompass both the budget and financial policies,

NACSLB levels 4, 11, 7.2, 12.1 and 12.2 are satisfied. The board’s stated objectives for its

budget and financial policies are as follows: (a) provide clear direction to staff in managing

finances and development of the operating budget and CIP, (b) provide “careful planning and

long-term financial management”, (c) raise credit rating to highest possible level, (d) develop the

budget and provide financial management that complies with Government Finance Officer’s

Association standards (Brevard County, 2011, p. 1). The board’s directives introduce separation

of duties. It calls for the budget office to develop the CIP and for the County Manager to provide


direction for the development of the budget. The capital portion of the budget is required to be

included in the annual operating budget as well. The board also lists among other requirements

that (a) a financial impact statement for all proposed capital projects, (b) staff will consider

privatization, (b) mandated programs will have priority over non-mandated programs, (c) budget

and financial policies are to be reviewed annually, (d) a flexible budget will be adopted that can

be amended during the fiscal year. The accounting and reporting is designated to the Clerk

Finance Department and that department is required to be in compliance with the Uniform

Accounting System of the State of Florida and Generally Accepted Accounting Principles

(Brevard County, 2011, p. 5). The board requires the Budget Office to submit quarterly budget

and financial reports that include department summaries and any budget variances. These

reports are to be compiled from the information generated by the Clerk Finance Department.

When projected changes can jeopardize the county’s financial position, as happened in FY 2009-

2010 when projected property values declined, the County Manager is required to recommend

the proper actions. The Budget Office is required also to provide an annual report to the board

after the auditor completes the Comprehensive Annual Financial Report. Additional

requirements include that all department directors who expend bond funds comply with federal

regulations pertaining to any findings so that they can be included in the annual disclosure. The

board also has developed a debt management policy that requires the County Manager to develop

long-range financing plans and appropriate analysis and reports. Similar requirements pertain to

private activity debt financing that is used to lure businesses to Brevard County. In fiscal years

2010 and 2011, Brevard County has been able to defease loans either through paying them off, or

new debt with lower interest rate bonds or loans (Brevard County, 2011).


The board’s revenue policy requires diversification of revenues and appropriate levels of

user fees that reflect direct and indirect costs; however this is easier said than done at Brevard

County. There is a reluctance to raise taxes and increase user fees substantially. Also, the board

still reserves the right to waive fees. To amend the budget, the board requires that budget

amendments, transfer of funds over $100,000 and changes to reserve funds be reviewed and

approved in the following order: (a) department head, (b) Budget office, (c) County Manager, (d)

Board. Although the board has an adopted policy to manage contingency accounts, the Budget

Director told the Board of Commissioners that they do not exist. The contingency is in actuality

the reserve balances in separate accounts. The board requires 10% of operating funds to be held

in reserve which assists with cash flow issues that may arise. It is important to note that this

reserve balance requirement is in addition to the statutory reduction of 5% of projected ad

valorem revenues for the year. Based on the review of minutes, supporting budget documents

and the budgets, Brevard County’s budget and financial policies are in congruence, and adhered

to by the staff and board (Brevard County, 2011).

Management Strategies

The NACSLB level 7.1, development of management strategies, requires special

attention. Six of the sustaining strategies presented on February 10, 2011 are the following: (a)

partnerships, (b) outsourcing, (c) service level identification and review, (d) cost containment

and review, (e) investment and enhancement, (f) role change and innovation. Arrington-

Marlowe, LLC and Howard Tipton stressed to the board that current employees, in the wake of

all the layoffs and hiring freezes, have to carry a larger load and perform additional tasks that

may require additional training. Since 2006 Brevard County has shed 417 jobs, or 15% of its

workforce which stood at a high of 2,740 positions in 2006, to 2,323 in 2011. The Human


Resource budget shows 800 hours of training for FY 2011-2012 in employee development. It

will also require the departments to seek opportunities for outsourcing, reengineering services

and seeking ways that volunteers could provide some of those services. The Library Department

utilizes the equivalent of 43 FTEs, and the Human Resources Department processed 70

volunteers in FY 2010-2011. Employing volunteers will need to be expanded as will

automation. Arrington-Marlow LLC also stressed to the board the importance of investing in

information technology in an attempt to automate as many processes as possible. Despite the

economic turmoil, Brevard County will be adding employers to the region and will continue to

prioritize economic development. The low taxes in the region generally and the state specifically

appeal to employers looking to relocate (Brevard County, 2011; NACSLB, 1999).

Budget Office

The Brevard County “Budget Office” is a freestanding department within the

Management and Community Services Group which is overseen by the Assistant County

Manager. The Budget Director reports to the Assistant County Manager who in turn reports to

the County Manager. This is to be expected for a large county. Brevard County’s population is

greater than 500,000 and the budget is nearly $1 billion (Michel, 2002). There is no separate

Finance Department or office. The Budget Office has a functional organizational chart. The

organizational chart flows down from the citizens, commissioners to the county management.

From there the budget office’s programs and services are divided into two separate functions:

(a) Financial, Revenue and Budget Program, (b) Performance Analysis and Capital Programming

Program. The Financial, Revenue and Budget Program is divided into (a) Budget Development,

Monitoring and Oversight, (b) Financial and Revenue Management. The Budget Development,

Monitoring and Oversight are responsible for (a) Budget Coordination, Processing and


Oversight; (b) Position Control; (c) Citizens’ Budget Development. Financial and Revenue

Management is responsible for (a) Costing of Service/Cost Allocation Plan; (b) Fee Analysis/Fee

Directory; (c) Fee Directory; (d) Revenue Forecasting, Analysis and Maximization; d) FEMA

Reimbursement and Oversight; e) Grant Management, Administration and Oversight; f) Long-

Range Financial Planning (Brevard County, n.d).

Performance Analysis and Capital Planning Program has two principle functions: (a)

Performance Management and Planning, (b) Capital Planning. Performance Management and

Planning has under its purview (a) Strategic Management and Planning, (b) Balanced Scorecard

and Performance Measures, (c) Business Process Improvement, (d) Financial Process and

Performance Audits, (e) Management Studies. Capital Planning’s area consists of (a) Capital

Planning, Analysis, Coordination and Oversight; (b) Debt Management Support; (c) Economic

Stimulus Reporting, Oversight and Monitoring. For all these functions the Brevard County

Budget Office has eight employees. The FY 2011-2012 Budget Office budget is $667,040. Of

that amount, approximately 86% comes from General Fund revenues, and approximately 14%

from transfers. Of the $667,040 budget, approximately 96% goes towards compensation and

benefits for the eight employees (Brevard County, 2011).

Brevard County Budget Conformance to Best Practices

Foregoing Maintenance

Brevard County as many other government agencies over the course of the last three

years has had to endure extremely difficult economic circumstances. Rapidly declining property

values have decreased resident wealth and county resources. It was not practical or possible for

Brevard County to adhere to all the principles of a good budget process (NACLSB, 1999, p. 4).

The decisions made by the County Administrator and later adopted by the Board of County


Commissioners reflect more a short- rather than the long-term view prescribed by the NACLSB

(1999, p. 4). For example, the Public Works Department, beginning in FY 2010-2011, has had

to forego road resurfacing. By not performing routine maintenance on its network of roads,

long-term, this decision will cause greater costs because these roads will eventually be beyond

the scope of a routine maintenance program and will have to be reconstructed (Brevard County,

2010).

Declining Employee Wealth

FY 2010-2011 brought Cost-of-Living-Adjustment freezes and increased employee

contributions to the health care plan for both board departments and constitutional officers.

Also, the management class and employees in the board departments lost 12 and 6 days,

respectively, to furloughs (Brevard County, 2010). FY 2011-2012 saw a different reduction to

their income. Each employee now contributes 3% of their income to the Florida Retirement

System which was dictated not by Brevard County, but by the State of Florida (State of Florida,

2011). The workforce has been reduced by 15% over the last six years. It is difficult to imagine

that these decisions motivate employees, but it is the reality of the difficult economic times the

nation faces today. Besides the decreased employee wealth and increased workload, Brevard

County continues to make decisions that align with stated goals and continues to engage the

public and operate in a transparent manner (Brevard County, 2011).

Budget Office Organizational Chart and Staffing

The Brevard County Budget Office, as a freestanding office reporting to an Assistant

County Manager, is typical for an organization as large as Brevard County. Forty percent of

organizations with a population over 500,000 have a freestanding budget office (Michel, 2002, p.

28). The organizational chart is functional and not hierarchical. The budget office is divided


into eighteen specialized functions; however, as stated, the office only has eight employees. It is

impossible to know from the functional chart how many supervisors are responsible for which

functions and how many employees are responsible for the eighteen specialized functions. This

is a departure from what Michel (2002) shows in the budget office structure.

The Brevard County Budget Office has taken on additional responsibilities at a time that

major budget cuts are being undertaken for numerous departments (Brevard County, n.d.). The

budget office did not lose employees from FY 2010-2011, but according to Michel (2002) the

Brevard County Budget Office has the minimum number of employees, eight, for a budget of its

size. With a budget of $931,931,814 for FY 2011-2012, the budget office’s expenditures, as a

percent of total government expenditures, is 0.07% which is at the low end of the range for

governments of its size (Brevard County, 2011, Michel, 2002, p. 67). Brevard County’s budget

office has 0.22% of all county employees which according to Michel (2002) is in the middle of

the range for large governments and slightly above the 0.19% average (Brevard County, 2011).

Long-Term Planning

The final observation to make about Brevard County is its lack of conformity to long-

term operating and capital planning. Brevard County is in the unenviable position, as has been

stated, of operating in extremely difficult economic times. The board instructed staff early in

2010 not to invest in projects that were tied to future residential housing growth. That seems the

right approach in light of all the deferred maintenance and capital expenditures. However, the

deferral of some of the maintenance and capital items such as replacing roofs and aging air

conditioning systems, and road resurfacing could lead to higher operating costs in the short-term

and higher capital costs in the long-term. It is one thing to cut the grass at parks less frequently,

but something quite different when repairs and maintenance need to be done. On the surface it


seems that the board’s decision not to address these critical items is short-sighted, but at the same

time quite understandable in the face of Brevard County residents’ economic suffering today and

the need to provide a basic level of service to them (Brevard County, 2010-2011).

Written in APA Style 6th

Edition


References

Brevard County. (2012). Retrieved from http://www.brevardcounty.us/

Brevard County. (2011, April 19). Meeting minutes. Retrieved from

http://www.brevardcounty.us/docs/budget-documents/budget-and-financial-policies-fy-

2011-2012-budget.pdf?sfvrsn=4

Brevard County. (n.d.). Meeting minutes. Retrieved from

http://brevardcountyfl.iqm2.com/Citizens/Calendar.aspx?From=1/1/2011&To=12/31/201

1

Brevard County. (n.d.) Meeting minutes. Retrieved from

http://www.brevardcounty.us/CountyCommission/Commissioners/District1/Home

Brevard County. (n.d.) Retrieved from

http://www.brevardcounty.us/CountyCommission/GovernmentOrganizationalChart

Jacksonville Transportation Authority (JTA). n.d. Retrieved from

http://www.jtafla.com/AboutJTA/showPage.aspx?Sel=27

Jacksonville Transportation Authority (JTA). n.d. Retrieved from

http://www.jtafla.com/pdf/Board_Agendas/Agenda-071212-rev2.pdf

Michel, R. Gregory. (2002) Organization and Design of an Effective Budget Functiontion.

Chicago, IL: Government Finance Officer’s Association

National Advisory Council on State and Local Budgeting (NACSLB). (1999). Recommended

Budget Practices. A Framework for Improved State and Local Government Budgeting.

Chicago, IL: Government Finance Officer’s Association

State of Florida, 31 May 2011. Retrieved from

http://www.miamidade.gov/hr/library/FRS%20contribution%20rates%202011.pdf


Appendix

1. Brief review of Michel and NACSLB literature.

2. Description, Analysis and Comparison:

a. Brevard County Budget Process-present in sequential order rather than presenting

by recommended budget practices

b. Budget Document

c. Financial Policies

i. State requirements

ii. Board requirements

d. Management Strategies

e. Budget Office

3. Conformity to Best Practices

a. Foregoing maintenance

b. Employee’s declining wealth

c. Budget office org chart and staffing

d. Lack of long-range financial planning

Documents

UWF Public Budgeting Model Research Paper