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Peter’s Take: Reform County Board’s Fiscal Year Close-Out Process

peter_rousselot_2014-12-27_for_facebookPeter’s Take is a weekly opinion column. The views and opinions expressed in this column are those of the author and do not necessarily reflect the views of ARLnow.com.

Early in 2016, the new County Board should overhaul the seriously-flawed process the current County Board uses to allocate any surplus funds left over at the close of the County’s fiscal year.

Background

Both the County Board and the School Board have fiscal years that end on June 30. Each Board is required, by law, to adopt a balanced budget. In many years, the County Board has closed its fiscal year with substantial surpluses. Since the School Board receives the lion’s share of its revenues from the County Board, the School Board receives a pro-rata share of any such locally-generated surpluses.

However, each Board currently has very different processes for deciding what to do with such surpluses. The School Board’s approach is far superior to the County Board’s approach.

Discussion

At its Nov. 19 meeting, the County Board is scheduled to vote to allocate tens of millions of dollars in prior fiscal year surplus funds. The County Board has scheduled that vote based on a proposed allocation contained in a staff report not posted on the County website when this column was submitted to ARLnow.com. This is exactly the same process the County Board has followed for years. You can review last year’s County staff report’s recommendations regarding how to allocate prior fiscal year surplus funds here.

Many activists believe that the County overestimates expenses and underestimates revenues in the operating budget it adopts each spring. They claim the County does this deliberately so that during the following fall’s fiscal year close-out, the County can eliminate a public review of its close-out recommendations comparable to the public review the budget receives in the spring. County staff counters indignantly that any such suggestions are false because the County’s spring budgeting approach simply demonstrates prudent financial planning for which the staff should be praised.

It isn’t necessary to resolve this heated annual debate over motive because there is a far better process available to guard against the possibility that the activists are correct.

The School Board first receives, posts on its website, and discusses in a public meeting its staff’s recommendations regarding how to allocate any surplus funds. But, the School Board does not vote on its staff’s proposal until the following month. This much fairer and more transparent process allows the School Board to:

  • discuss the initial APS staff recommendations at a public meeting,
  • receive a public report from the APS Budget Advisory Committee, and
  • wait a month to get further input from the general public, before finally
  • adopting the final allocation of any APS surplus funds.

Conclusion

The new County Board should adopt the School Board’s close-out process.

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