“The budget process is always a mix of subjective and the objective.” —City Manager Mark Jinks
In this year’s city budget process, the city government is test-driving a new outcome-oriented method of prioritizing public services.
Senior administrators think the new system will help optimize increasingly scarce revenues, and also help the public to weigh relative costs more consistently. City Council members offered mixed responses at a budget retreat on Saturday, Nov. 10. Some expressed concern that the new approach could over-automate what ought to be a political process, while others applauded what they see as improved meticulousness.
The system, known as Priority Based Budgeting, intends to “help us examine everything we do in the context of its relative influence over the city’s priorities,” said Lisa Henty, the city’s assistant budget director. Every service determined to have a low relative priority wouldn’t automatically head to the chopping block, but public expenditures continue to outpace revenues from year to year. Priority Based Budgeting aims to identify areas from which the city might reallocate existing funds, before resorting to new taxes as a last resort.
In building the city manager’s FY 2020 budget proposal, forthcoming this winter, inter-departmental staff teams numerically scored and ranked some 510 city services. Higher scores went to services that are mandated by the state or federal government; serve many residents; offset their costs through, for example, user fees; and rely on city government for their provision. Lower scores went to services that are locally self-imposed; serve fewer residents; generate little or no cost-recovery revenue; and could come from institutions other than local government.
Additionally, for community services, staff scored the degree to which each service advances relevant goals set out in the city’s Strategic Plan. For internal services, they scored how well each service advances characteristics of good governance — for example, “recruiting and retaining a high-quality workforce” and “maintaining the [city’s] bond rating,” said Morgan Routt, the city’s budget director. Higher scores went to services with “strong” or “some influence,” lower scores to those with “some,” “minor,” or “no” influence.
Finally, based on composite scores, all 510 services were divided into quartiles, with higher quartiles indicating higher “alignment” with the city’s big-picture priorities. Staff put about two-thirds of city service into the top two quartiles and about one-third in the bottom two, including about $40 million in the lowest portion.
“That doesn’t necessarily mean that we can cut $40 million from the budget,” said Routt. “But it does give [council] an area to look at” for potential service reductions and resource reallocation. The city manager’s budget proposal document will include each service’s ranking, as of yet unpublished, for public consideration.
Taking a more cautious view, Mayor Allison Silberberg said: “It’s really important to be data-driven,” but also to weigh the “humanistic side,” which scoring might not capture.
Similarly, Councilwoman Redella “Del” Pepper said: “When something [that’s important to people] comes forward, I don’t want to hear, as if it were a deciding factor, ‘Oh, but, we analyzed all of this and it’s a low priority,’” said
Taking a more positive view, Vice Mayor Justin Wilson said: “There’s always clearly going to need to be the council looking at what is proposed.” But “applying a pretty rigorous qualitative and quantitative rubric to all the spending in the city, in order to make proposals for reductions that are going to be difficult no matter what, … [is] a really, really good thing.”
Councilman Tim Lovain said: “Lots of times we budget by ‘squeaky wheel,’” referring to “passionate” sub-constituencies that resist cuts in their favored areas. By contrast, Priority Based Budgeting “provides some really good, objective basis for making these tough decisions.”
“The budget process is always a mix of subjective and the objective,” said City Manager Mark Jinks. “The intent here is to put … a lot more of the objective in, to establish a rigor in the budget process so the questions get asked. That’s a fairness issue, to make sure every program gets a thorough review, and this is one way of helping us identify areas to look at. But there’s still a subjective nature that says, what are the factors that aren’t neatly scorable …?”
Priority Based Budgeting isn’t objective in the strictest sense. Ranking a service’s strategic influence depends on how one interprets certain Strategic Plan goals, said Routt. But consideration “doesn’t just end when the number pops out.” The method’s primary value lay in its systemization and consistency across city government. It could also help the public to take a broader view, and not zero in on line item tweaks that amount to only a fraction of the total budget, he said.
For more, visit www.alexandriava.gov/Budget.