Budget Guide
Budget Overview
In order to understand the detailed information throughout the adopted budget document, this overview not only offers guidance in navigating the document, it also provides a critical narrative to understanding the city’s current financial position and challenges.
PURPOSE OF THE BUDGET
The budget provides a comprehensive financial agenda for all city activities during the two fiscal years. The budget is meant to serve the following five major purposes:
- To define policy, as outlined by the City Council.
- To serve as an operating guide to aid in the control of financial resources while still complying with State requirements for General Law Cities and Generally Accepted Accounting Principles for Government.
- To present the City’s financial plan for the designated fiscal years, showing appropriations and projected revenues by which the appropriations are funded.
- To serve as a communications document for the residents of San Bernardino and to ensure financial accountability and transparency regarding city operations, and the stewardship of public funds.
- To reflect community, Mayor and City Council vision and goals for the City of San Bernardino.
BUDGET AND FINANCIAL FORECASTING
The City previously budgeted on an annual basis. This biennial budget cycle marks the second ever Biennial Budget for the City of San Bernardino in over ten years. The City also conducts financial planning over a ten-year time frame; this is done to ensure that decisions are made within a larger financial perspective. Budget decisions are made such that resources and requirements balance over the ten-year plan.
THE BUDGET PROCESS
Mid-Year Budget Review
The City’s fiscal year begins July 1st and ends on June 30th. In January, internal data analyses and projections are conducted, as well as input from all city departments, to estimate what the expenditures and revenues will be by June 30th. The estimates are based on actual expenditures and revenues received through December (the first half of the fiscal year). Finance department staff analyzes the departmental estimates and makes adjustments to the amounts as needed. A report detailing expected expenditures, revenues, and a preliminary first estimate of the city’s budget needs for the upcoming year is then presented to the Mayor and City Council.
Preliminary Budget Preparation
Departments are given their budget instructions in December of the even-numbered year. The budget instructions include bottom-line departmental budget target amounts, personnel costs for currently authorized budgeted positions, current costs for internal service charges, instructions explaining how to use the OpenGov budget system, and current year revenue information. Internal service departments (Information Technology (IT), Fleet Services, and Risk Management) prepare their own expenditure and revenue budgets. Finance develops the allocation of these programs to other city departments.
Finance is responsible for analyzing and determining if departments are to be held to the same bottom-line budget amounts as allocated in the current budget year or if they are to be given a percentage increase for their maintenance and operations budgets. Allowable percentage increases are determined by the Director of Finance, Deputy Director of Finance, and the Budget Division Manager. Personnel costs are subject to increases or decreases contingent on negotiation agreements per bargaining unit; internal service charges are subject to increases or decreases contingent on costs allocated in the respective Internal Service Funds; retirement and health benefits are subject to increases or decreases contingent on selected provider rates; as well as any other specific changes approved by the Director of Finance and City Manager.
Preliminary Budget Presentation
Budget proposals are due back to Finance in January for review and analysis before the submittal and review phase with the City Manager. During this time is when Finance staff makes notes and adjustments to the departmental budget proposals as needed. Throughout the months of January – March, budget meetings are held with individual departments, Finance staff, and the City Manager. These meetings allow departments to present their budget and justify any requests for increased funding. Upon completion of the meetings with each individual department, the City Manager makes any final adjustments to the departmental proposals.
A preliminary budget document is developed which presents the cost of providing service to the community at current levels (no service reductions are included in the preliminary budget document) with any allowable increases that were determined in the Preliminary Budget Presentation phase. The preliminary budget document also presents the estimated funding resources available given the current economic outlook, legal restrictions, and the availability of state and federal funding. The preliminary budget document is presented to the Mayor and City Council in May.
Final Budget Adoption
A series of special council meetings are held to review the preliminary budget document and, if necessary, discuss options for balancing the City’s budget. The entity defines a balanced budget as one in which expenditures do not exceed revenues. Departmental suggestions for revenue enhancements and expenditure reductions are presented to the Mayor and Council for their consideration. Public input is invited through two hearing notices appearing in local newspapers on two sequential Sundays prior to final adoption. By June 30th, the council adopts a balanced budget or spending plan through passage of a resolution.
BUDGET BOOK ORGANIZATION
This document is the city’s first ever interactive Budget Book! The interactive book contains six main parts:
- Introduction & Background
City’s operational model and organizational chart. Brief history and current profile of the City. Strategic goals and vision for the City adopted by the Mayor
and City Council.
- Budget Overview
- Budget Narratives & Summaries
- Department Budget Detail
- Capital
- Grant Funding