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HomeMy WebLinkAbout13 - Consideration of Forming a Budget CommitteeCITY OF NEWPORT BEACH AGENDA ITEM NO. 13 TO: HONORABLE MAYOR AND MEMBERS CITY COUNCIL FROM: Homer L. Bludau, City Manager DATE: July 23, 2002 SUBJECT: Council Consideration of Forming a Budget Committee ISSUE: Should the City Council establish a Budget Committee with City Council and resident representation? RECOMMENDED ACTION: That City Council take no action to establish a Budget Committee, but instead work through the Public Information Officer, local media, and the City's web site to better publicize budget review meetings or workshops along with the budget and CIP themselves. BACKGROUND: On June 25, 2002, in both the Study Session and Regular City Council meeting discussions on the proposed FY 02 -03 budget, resident Barbara Johnson requested that the City Council establish a Budget Committee composed of City Council Members and residents. Ms. Johnson went on to say that by observing and participating in the budget review process, she understands the City's proposed budget but thinks that a Budget Committee would better serve the City Council and the community. The City's budget process begins in December of each year. The process involves the following steps: 1) the Administrative Services Department estimates potential revenues, estimates fund balances, and establishes departmental budget ceilings for the new budget year; 2) the City Manager issues budget preparation parameters to the departments; 3) departments prepare budget submittals; 4) City Manager reviews department budgets; 5) City City Hall • 3300 Newport Boulevard • Post Office Box 1768 • Newport Beach, California 92659 -1768 Council Consideration of Forming a Budget Committee Page 2 Manager recommends budget for new fiscal year to Council. The draft budget normally is available in early May and distributed to the City Council and departments at that time. In addition, copies are made available to the public through the public libraries, City Clerk's Office and the Administrative Services Department. The City's practice is to dedicate three full two hour Study Sessions to budget review. The public is welcomed to attend and participate in the discussions. Budget review meetings are taped and replayed at later dates. A noticed public hearing is held on the proposed budget as well. The City Council has established a Finance Committee, which is composed of City Council members and staffed by City employees. The purpose of the Committee is to review financial issues with staff (including the proposed budget) and to bring issues forward for Council's consideration. All Finance Committee meetings are agendized, noticed, and open to the public. In addition, the City produces the Resource Allocation Plan. This is not only a very user - friendly summary of the budget, but it also provides a lot of information that is often seen in a "program" budget. For members of the public who are interested in understanding the City's budgetary priorities, this document shows what the City's money is being spent on. The City Manager believes there is little to be gained by the public and by the Council in forming a Budget Committee. Such a Committee would have no more than 3 Council Members and a small number of residents. The City Manager believes that budget issues and information are better reviewed by a full City Council, in meetings where all community members can attend. Our City Charter assigns the responsibility for preparing annual budgets to the City Manager and the responsibility for adopting budgets to the City Council. Our residents elect Council Members to represent them in City decision - making. Establishing Council priorities through budgeting is the most effective way for Council Members to influence the community. Council Members are in contact with the members of the community on a daily basis throughout the year. Council Members' priorities and community needs are conveyed by Council Members to the City Manager on a constant basis. The City Manager takes those needs into consideration when preparing a budget. Council Members and residents often bring additional budgeting needs to the attention of Council and the City Manager during our budget review process. The process is intended to provide the Council and the public as much review and discussion as necessary for the Council to feel comfortable in adopting a budget. If the time frame or amount of budget review is not adequate, staff is certainly willing to provide more discussion opportunities. But the City Manager believes the current budget review process with the participation of all Council Members and all residents who desire to participate best serves the needs of the Council Consideration of Forming a Budget Committee Page 3 community, and the creation of a Budget Committee would not add significant community participation over the current process.