Who is interested in a short story about the municipal budget process for Lawrence Township? Hmmm, well, I am going to proceed as if there are more than a few that are curious enough to read this article with the hope of being more informed on a topic that is generally a mystery to most. Before we begin, the NJ Municipal Budget Law and the books written in an attempt to interpret it are much more extensive and include much more details than the conversational description that follows. Please proceed with the knowledge that I intend to avoid the weeds….!
First
things first: a budget is the funding tool for the various operations of the
municipal government and the delivery of services to the community. In addition,
it lays out the capital program for the maintenance and expansion of the town's
infrastructure, equipment, and buildings. In our form of government (Council-Manager),
the Municipal Manager is responsible for preparing the municipal budget, and
the governing body (Council Members) is responsible for reviewing, considering,
and adopting the budget by their majority vote at an open public meeting. By doing
it this way, there is a check and balance system where the elected officials
act on behalf of the taxpayers in an open and transparent process to ensure that their money is used responsibly
to provide the essential services the community expects and deserves. Adopting a
budget is the most critical function of the governing body.
Our
"budget season" starts in October of the preceding budget year when
the Chief Financial Officer (CFO) (Peter Kiriakatis) directs the various
department heads of the municipal government (i.e., Public Works, Police, Fire/EMT,
Recreation, Health, Finance, Construction, Court, etc.) to prepare their
budgets. It requires them to determine what they need to deliver the services their
department provides to the community and how much it will cost. It also requires
them to forecast for anticipated and unanticipated future challenges and set a
course to improve and enhance the services over time. Once the departmental
budgets are received, they meet with the CFO to make changes, if necessary, to
better conform with the overall budget strategy created through the collaboration
of the CFO and the Municipal Manager.
The
Municipal Manager and the CFO often can determine early in any given year the
financial challenges they must address in the next budget year. For example,
this past year, we are all aware of the economic fallout from the world health
pandemic, with shortages across many industries that have led to inflation and
higher costs in all areas of our lives (i.e., energy, fuel, insurance, etc.,
etc., etc.). You need to know that the higher cost of living you are dealing with
in managing your household finances is the same challenge that municipal
governments face when preparing a budget to deliver services to the community
in the coming year. The only difference is that a municipal government must, by
law, prepare and adopt a budget that can only spend (appropriations) the same
amount it expects to receive in revenue or through taxation. It is called a balanced
budget, and unanticipated costs that arise during any given year are always problematic.
Preparing a thoughtful and responsible budget is crucial for a town's
financial strength.
After
the department heads complete their budgets, the CFO and Municipal Manager have
broader budget discussions and make decisions that result in the preparation of
a "recommended budget" presented to the governing body formally at a
council meeting. The CFO and Municipal Manager intend for the recommended
budget to reflect and be consistent with the policies the governing body has
established and directed them to achieve yearly.
The "recommended budget"
was presented to the council members on January 17, 2023, with a presentation by
the CFO providing a broad overview. It is available on our website for those
that are interested.
In
February, the department heads will appear at council meetings (open to the public)
and present a summary of their budget to the governing body and answer questions.
Also, during this period, the council members will review the recommended
budget line by line and often have questions or provide comments to the
Municipal Manager in anticipation of the formal "Introduction of the
Budget" scheduled to occur in the first meeting of March 2023. The budget
presented in the "Introduction" often differs from the "recommended"
budget after the governing body provides its input and direction for a budget it
would accept and adopt. But that's not
all! At the public hearing on the adoption of the budget, the public will have
an opportunity to comment and let their opinions and concerns be known to the
council members before they vote. We anticipate the public hearing and adoption
of the budget will take place on April 18, 2023.
