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Performance Based Budgeting Needed In County & City Hall

Filed under: Erie County, Local Politics

BuildingBetterBudget140

Section 2503 of the Erie County Charter states in part:

“Quantification: Program measures and performance standards to be used in monitoring and evaluating the delivery of services, including the specification of appropriate evaluation cycles and milestones, and a description of the manner in which the citizens of the County will be able to obtain access to the results of such monitoring and evaluations.”

The language above requires Erie County to establish performance measures to monitor and evaluate the delivery of services. Several years ago citizens of Erie County approved in a public referendum a new Charter, which among other changes required the county to utilize performance based budgeting. While this language is in the Erie County Charter, performance based budgeting has not been implemented. The City of Buffalo has its CitiStat program, but the tracking of city departments is not tied to an overall strategy.

A recent article at the IBM Center for the Business of Government, titled Performance Budgeting, Texas-Style, provides some great tips on implementing performance based budgeting in government. As stated in the article:

“There is no one single definition of performance-based budgeting (PBB). A review of the literature does, however, suggest what it means commonly. Most observers of—and experts on—public budgeting do agree that, generally speaking, PBB is the allocation of funds to achieve program­matic goals and objectives as well as some indication or measurement of work, efficiency, and/or effectiveness.”

The four points below are excerpts from the article.

Four Key Implementation Insights

First, don’t separate budget and finance systems from the strategic goals of political leaders.  These processes and systems need to be tied to the overall strategy of the city or state via committed leadership in both the executive and legislative branches.  For example, Baltimore City’s mayor , Stephanie Rawlings-Blake, has identified six priorities for the city and the city’s budget is organized around those priorities. 

Second, use analytics and evidence-based approaches to inform budgeting priorities.  This increases the likelihood that resources will be targeted to the root cause of a problem rather than its symptoms.  For example, in Virginia, evaluations have shown that third grade reading levels are a strong predictor of future academic performance.  As a result, the state has targeted additional budget resources to third grade reading programs. 

Third, budgets should be organized around the outcomes or initiatives in the strategic plan – and not around the traditional agencies and programs that populate the organization chart.  In Iowa, for example, former governor Tom Vilsack proposed a set of priorities and agencies “bid” on what they services would contribute, and at what cost, to implement the priority.  This was then used to develop the budget proposal taken to the legislature.

Fourth, to make this possible, states and localities need to create a budget and finance structure that can accommodate such flexibility.  This means creating common classification standards across budget, grant, contract, and financial systems that can show how discrete inputs can be tied back to broader outcomes.  This more technical requirement tends to be a prerequisite for providing budget and financial information in various formats to ensure accountability by various stakeholders.

Performance Budgeting In Texas

Texas has used performance budgeting for more than two decades.  The governor prepares a strategic plan, uses its to prepare a budget proposal and the legislature adopts a biennial budget for the state that includes specific levels of performance linked back to the strategic plan. A 2005 IBM Center study by Joe Adams provides a good overview, beginning with the creation of a statewide strategic planning process in 1991.

recent guide that explains the process says that the governor and the Legislative Budget Board prepare a mission statement and core principles, and then the 200 relatively independent state agencies each prepare a strategic plan.  The most recent strategic plans covers the period 2011- 2015 and are used to develop agency budget proposals. 

Each agency’s budget proposal includes:

  • A Goal
  • An Outcome (or results, or impact)
  • One or more Strategies
  • One or more Outputs (volume)

These are then followed with Performance Measure Targets for each outcome and output.

Erie County and Buffalo have not identified a few key priorities to focus on. Without a clear vision and focus, organizations drift. We need leadership at the top and in the legislative bodies to push for a discussion on establishing high priority goals that are measured to determine success.

What do you think about implementing performance based budgeting in government?

www.reinventinggov.org

 

 


  • Chris

    It is our right to know how our tax dollars are being spent. A programmatic budget achieves that goal by clearly articulating the objectives and goals of every program, with dollars deemed necessary to achieve the objectives and measurements for determining effectiveness. As a member of the Erie County Charter Review Commission and Chairman of the Finance Committee we spent a lot of time discussing transparency and accountability in budgeting – It was obviously necessary after the 2005 budget meltdown. On the revenue side we suggested checks and balances between the County Executive, the Comptroller and the Legislature to ensure revenues were realistic at budget time and were monitored throughout the year for unforeseen variances. On the expense side we called for programmatic budgeting because we recognized that line item departmental budgeting was to opaque, with no real ability to connect the dots between the objectives of the department and how money is being spent and no measurements for determining effectiveness. The process for approving and monitoring revenue is working in Erie County even if it looks like political football at times, however we are on our third County Executives now and we still are not following the charter, we still do not have a programmatic budget that is transparent and accountable to tax payers. Maybe this year the County will get around to it… – Chris Duquin

    • Wrongful Acquittal

      Chris:
      Please explain, because I’m sure you guys discussed this issue. When performance metrics are not met, as in the case I portray above (which I think is accurate), what would you do to a department like that of the District Attorney? DAs aren’t paid anywhere near what many can make on their own. Therefore, you can’t easily replace people with all that prosecutorial experience. In fact, Sedita’s performance measures may be the result of his purge of experienced people when he took over.

      • Peter_A_Reese

        If I can Buttinski here, I think the answer to your question is that you do nothing charterwise and let citizens decide to replace their elected officials when performance is inadequate. I have always felt that performance based government is desirable because it enables the citizens to see what services are being delivered at what price. That doesn’t mean that voters will actually avail themselves of this information or take action on it. One would hope that increased accountability will lead to better governance, but that isn’t necessarily true. We all have a constitutional right to vote for fools and felons. However, in the absence of performance based measures, we don’t even possess the information needed to make informed choices. For all we know, Erie County has the most effective and efficient government in the history of man. Or the worst. It’s unacceptable not to know which.

      • Wrongful Acquittal

        You’re not being a Buttinski Peter. I welcome comments. I’m not sure if I’m for or against this “performance based government”, simply because I don’t know enough about it. To me, it sounds like just a repackaging of simple management and basic common sense. As I mentioned earlier, there are instances where this “unit based” method doesn’t take into account other realities. At the same time, obviously there is something wrong with the system when you see that Sedita’s performance, based on the reported numbers in the Erie County budget, go completely unnoticed or are questioned by the legislature. It’s simply not acceptable. And the public can’t be expected to sift through line items in a gigantic budget to decide. Sedita went unapposed last time. The Republicans are partly to blame for not providing a candidate, and show by these statistics (and other things) that Sedita is incompetent and not worthy of the public’s trust.

      • Peter_A_Reese

        You are correct. This is just a common sense attempt to give the people of EC a budget they can use to evaluate the cost and quality of the services they receive and perhaps compare them to other similar governments elsewhere. See http://www2.erie.gov/law/index.php?q=article-25-financial-procedures-charter
        In Section 2503, we clearly stated that objective: “Intent. It is essential that the proposed and adopted budgets be presented in a form which is both usable and understandable by the citizens of the County.” There is no magic solution here, just an attempt to make things much more transparent than they were in 2006. Quite frankly, I cannot figure out where my money is going. I don’t think county legislators can either. That’s unacceptable.

  • Peter_A_Reese

    The language from the Erie County Charter quoted above is brilliant. Whoever wrote it is clearly a genius.

  • Wrongful Acquittal

    A couple of years ago, when I started getting really annoyed by Frank Sedita, I researched the Erie County approved budgets to look at Sedita’s performance measures compared to his predecessor. I created back then a comparison spreadsheet, which I just found after reading this article. In the major categories, Sedita’s DA office performance is nearly half of the previous DA. Sedita’s tenure is the area shaded pink.

    • marks

      If SEDITA has less cases why does he refuse to prosecute election fraud?

      • marks

        Also notice how the narcotic cases have dropped!