Smithfield Budget Process — An Effective Process in Fact Finding, Transparency and Fiscal Management

Posted

June 3, 2023

Written By

Kenneth J. Sousa, PhD

The Chalkboard Foundation

Transparency – Something transparent, especially a picture, design, or the like on glass or some translucent substance, made visible by light shining through from behind.  (Dictionary.com)

Great definition if you are working with physical components.  However, how is transparency defined in a business context?

According to Forbes, “Business transparency is the process of being open, honest, and straightforward about various company operations. Transparent companies share information relating to performance, small business revenue, internal processes, sourcing, pricing, and business values.”

Budgeting 101

Many business, education and governmental leaders have a responsibility to their owners, stockholders, regulators, and customers.  It is termed a fiduciary responsibility.  Some people take this responsibility too lightly.

A fiduciary accepts legal responsibility for duties of care, loyalty, good faith, confidentiality, and more when serving the best interests of a beneficiary. Strict care must be taken to ensure that no conflict of interest arises to jeopardize those interests. (Investopedia)

Budgeting and fiscal management require a tedious and decisive process to scrutinize past and recommended expenditures.  Ultimately, it is a plan.  The definition of a plan is deciding what you are going to do before you do it.  Plans require outcomes.  Ultimately, the fiscal decisions should (I would argue must) be connected directly to outcomes, not to arbitrary, past norms or ‘institutionalized” practices.

Fiscal Management for Governments

The City of Baltimore employs a great practice … “Outcome Budgeting is a budget process that aligns resources with results. The budget is organized at the service level around the City's Priority Outcomes.”  From an article in Budgeting for a Better Baltimore, one section hit the bullseye!  Here is an excerpt from the article.

Why Outcome Budgeting?

Traditional budgeting may have worked in the past, but the economy we face today requires a more strategic, transparent budget process. Outcome Budgeting does just that, by …

  • Addresses fiscal constraints
  • Rewards innovation
  • Measures performance
  • Makes the budget process more transparent

Think this hit the nail?  Absolutely!  Now the real challenge is to place verbs in sentences creating real action to implement this exceptional fiscal mindset.  In government, that’s the opportunity to be exceptional.

Smithfield’s Budget and Financial Review Board Process

As a member and Vice Chair of the Budget and Financial Review Board, it is important that we analyze and examine all Town departments’ budget submissions as well as the Town Manager’s recommended budget.  The budget process cannot be approached as a “rubber stamp.”  In addition, we also must focus on a fiduciary responsibility to the taxpayers and residents of our Town without any political or personal favoritism.

At the April 19 meeting, I prepared several questions to ask the School Department.  The meeting was lengthy.  Unfortunately, due to the late hour, I was not able to ask my questions.  I was told to submit my questions through ClearGov (the Town’s budget software application).  I conveyed that I would not do this because many of my questions were not specific to a budget account number rather more high-level question scope.  Additionally, only registered users can view the question and responses, not the public.

I compiled my questions in a document and sent the questions to Superintendent Bartz on April 22.  I received her responses on May 5.  I appreciate the responses to the questions on behalf of SPSs.

On May 8, the BFRB agenda included a final review and vote for the Smithfield Public Schools budget.  I attended the meeting with three documents: 1) the original questions, 2) SPSs response, and 3) a compilation of SPSs responses combined with follow-up questions.  Knowing that there would not be ample meeting time to review the dialogue of questions and responses, I provided the three documents to the BFRB’s meeting recording secretary to attach to the minutes.  These minutes have not been approved as of June 2.  Therefore, I am publishing these documents combined with the budget report for SPS.

Budget and Financial Review Board Process

The files are provided below.

Additional follow-up will be forthcoming.