Island County Comissioners’ Version of Zero Based Budgeting is Flawed. Their Cost Justification Lacks Accuracy and Prioritization; it’s a Useless PR Gimmick

Following is an example of trying to get Island County to consider using ZBB (zero based budgeting methodolgy):

Island County needs to correct its approach to budgeting

In August, 2010, John Barnes,  Communications Director for Washington Policy Center, a public policy research think tank in Washington state, and an expert in budgeting. and fiscal management published the following in The Herald (Everett) on August 29, the Stanwood-Camano News on August 31, and the Whidbey Examiner on September 1.

Island County Commissioners were copied on these articles

John Barnes,

 “Island County voters soundly rejected a proposed property tax increase this month. In doing so, they told county commissioners they want them to do what all of us have been doing lately — make do with less. The bottom line is clear: County government can’t ignore the new economic reality faced by the citizens who fund it.

What the Board of County Commissioners shouldn’t do, however, is use the blunt instrument of across-the-board budget cuts to address the deficit. It may make for better politics, but it’s not sound policy. The commissioners insist they have no choice, but that’s simply not true.

The traditional approach to government budgeting is to start with what’s called “maintenance level” — next year’s cost for doing exactly what’s being done this year. The problem is that, in addition to guaranteeing spending growth, this approach never forces county officials to re-evaluate the services they provide and how they provide them. As a result, when revenues flatten or drop, officials are unwilling to respond to new economic realities.

Two examples of a better approach are underway and offer a roadmap for Island County.

Gov. Chris Gregoire is telling state agency heads to re-evaluate all of their activities using several critical questions:

•Is the activity a core function of government or commercial in nature?
•If it is a core function, can the service be provided more efficiently and effectively through competitive contracting?
•Does it provide a broad public benefit or only serve a special interest?
•Does it duplicate the activities of nonprofits or other private initiatives?
•Does it duplicate the efforts of other agencies or programs?
•Does the activity demonstrate quantifiable performance?

This new thinking is taking place at the local level, too. Recently the city of Bellevue enacted a new budget process that City Manager Steve Sarkozy calls “a fundamental reset.”

Under the new process, before the funding an existing or new service, a department must submit it as a proposal and align it with a specific outcome. Evaluation teams write and rank the spending proposals depending on how each achieves the desired results, based on evidence and facts. The proposal has to precisely define what it is delivering in order to get funded. In other words, the city won’t just spend money on a program simply because it always has. This is known as performance-driven budgeting.

Bellevue’s “Budget One” plan is clear: there is no “base budget.” There are no guarantees of historical funding levels. The underlying assumption is that forecast revenues will likely be less than past budgets, so the expectation is that the cost of government will be less than the current budget. “Departments are expected to utilize innovation, collaboration and creativity to meet this expectation,” Bellevue officials say.

There are alternatives to across-the-board budget cuts in Island County, but commissioners must make bold decisions to truly scrutinize and prioritize services. The highest priority services should be funded first. If everything is a priority, then nothing is a priority.”

These articles continued with this:

County officials will likely claim they don’t have the time or money to do this sort of evaluation and prioritization. But in doing so, they’d be telling the county’s citizens that they’re not interested in determining whether tax dollars are being spent effectively and efficiently.

Island County officials have great local examples to tap for ideas in crafting a new budget that lives within the county’s means.

Taxpayers here work hard to provide for their families and communities. Officials owe it to them to do everything possible, no matter how difficult, to prioritize spending and ensure public money is spent well. No option should be off the table. No more sacred cows.

Island County Commissioners face difficult challenges. To meet those challenges they must do what they have not yet done: fundamentally rethink what the county does and how it spends money.

Their response must be innovative and outside-the-box. The times, and the county’s hardworking taxpayers, demand no less.”

For the past 2 years Commissioner Price-Johnson and ex-Commissioner Homola claim they have been using  their modified  version of Zero Based Budgeting successfully;

THAT’S NOT TRUE;  NO  DOCUMENTS  OF  FINANCILAL JUSTIFICATION AND  PRIORITYY RANKING S EXIST  FOR PUBLIC  SCRUTINY

My 25+ years SUCCESSSFUL experience working with ZBB involving both government and private business entities tell me that County’s Version of Budget is light years away from Zero Based Budgeting

For example last year County spent about $25,000 to fund Washington State Salmon Recover Board and Homola’s Swan Lake Watershed Preservation Group activities trying to prove that Swan Lake was an estuary 100 years ago and it must be restored to that condition to save the baby salmon

It was not an Estuary 100 years ago and we have several pictures taken in the 1900 era to prove it

SWAN lAKE  LAKE  AUGUST 1908:

That money the  Commissioners spent spent in 2012, resulted in nothing but talk and requests for more funding

The recently approved SMP identifies $50,000 more funding  planned  in FY 2013 to “Study” making Swan Lake an estuary

That’s NOT Zero Based Budgeting or anything close to it;  it’s “Relative” or “maintenance level” budgeting/spending, i.e., … spent $25K last year and need to spend more this year

How about it, Commissioners. Provide the voters financial justification  and priority ranking  documents for spending that $50,000;  the money you have wasted on this fiasco would have paid for repairing the tide gates with dollars to spare

County is out of money and but  the Commissioners continue dumping dollars they don’t have into non-mandated, socially justified schemes to please special interest groups

“Insanity is doing the same thing over and over again but expecting different results.”

This must stop