Here’s How One City in Kansas Has Been Pushing to Improve Its Budgeting Process

Keeping the streetlights on in the city of Shawnee, Kansas, costs upwards of $1 million annually.

City Manager Carol Gonzales said that sometimes when area residents hear that number, they find it hard to believe, and respond along the lines of: “Oh, it can’t cost that much.” But it does. “Yeah, it costs that much,” Gonzales said during a phone interview last Wednesday. “By the time we pay the electricity, we replace the bulbs, we pay the people who service them, we buy the equipment needed to take care of them, it’s $1.2 million a year to run our streetlight system.”

Gonzales can swiftly point to that figure because, during recent years, Shawnee has gone through the process of breaking its budget down in terms of programs. With this approach, costs tied to something like the city’s streetlight system—considered a program—are added up into a single figure, even if they fall across different departments, or are included in numerous budget line items. “Having those kinds of facts at our fingertips has been really helpful,” Gonzales said.

Located about 10 miles southwest of Kansas City, Shawnee has almost 65,000 residents, according to the most recent U.S. Census Bureau estimates. The city began the push to inventory its programs about five years ago. In 2013, Shawnee also moved to ingrain priority-based budgeting into its budget-making process.

Priority-based budgeting involves a community identifying its most important priorities. Programs are then scored based on how well they align with those priorities. These scores help to guide how budget dollars are allocated.

Shawnee continues to construct a traditional budget each year with funds and line items. But the priority-based system informs this process by showing how the city's money has previously been allotted for each of its programs.

“It’s just really giving it a different look, it doesn’t replace it,” the city’s finance director, Maureen Rogers, said by phone last week, referring to how priority-based budgeting is combined with the traditional approach to budget-making. “It’s kind of layered on top of it,” she added.

What Is A Program?

Inventorying Shawnee’s programs was not an especially easy task.

Caitlin Gard, Shawnee’s assistant public works director, has also helped coordinate the city’s priority-based budgeting efforts. Referring to the program inventory process she said: “That was a little bit difficult for us.” One of the main challenges, according to Gard, had to do with answering a seemingly straightforward question: What is a program?

“That was definitely the biggest issue,” Gard said. “Explaining that to an engineer and then, say, a police officer, I mean, you have to explain it differently,” she added. “And we wanted everybody’s programs to be, kind of, the same level of size.”

The number of budget dollars and employee hours that went toward certain city government activities were two criteria that Shawnee’s staff used to define programs.

So, for instance, every department did not get to designate the work they do issuing various types of permits as a full-fledged program. In some departments this work did not involve significant enough expenses and manpower to make that cut.

“Of course every single department wanted a permitting-type program,” Gard said. “But some departments, like our stormwater division in our public works department, that’s really small.”

A spreadsheet summarizing the city’s program costs, posted on Shawnee’s municipal website, lists 228 programs, such as payroll, fire investigation and public defender services.

The city also maintains program inventory web pages, which allow users to click on an individual program to see its cost, goals and activities.

For example, the cemetery management program, which falls under the Parks and Recreation Department, cost the city $63,061 as of September 2014. It involved activities such as providing consultation with families for about 20 burials per year, and maintaining 8.5 acres of grounds.

Gard believes the program inventory web pages could be more “user friendly.” But she added: “It’s definitely way better than where we started.”

An objective going forward, she said, is to get a more interactive online interface in place, which will allow for greater public engagement with this type of budget information.

‘Where Does It Say We’re Required To Do That?’

When Shawnee’s city staff came up with scores for the city’s various programs, it wasn’t just department heads that participated in the process.

“We used a multitude of different employees,” Gard explained. “Some maintenance workers were involved.”

Guiding the scoring were Shawnee’s seven priority-based budgeting goals: an attractive, healthy, and well-maintained community; economic growth and vitality; effective mobility and reliable infrastructure; an environmentally sustainable and well-planned community; quality cultural and recreational opportunities; community safety; and good governance.

The programs that go furthest toward achieving these results get ranked the highest.

Gonzales, the city manager, pointed out that the city used cross-departmental teams to do the scoring. So someone from public works might have helped score a law enforcement program, while someone from the police department might have helped score a program related to parks.

This gave department staff a chance to learn about city services they might not have been acquainted with. “Organizationally, everybody got better educated,” Gonzales said.

Something else interesting happened as city staff members carried out the scoring process, she noted. Initially, at least, “people thought, ‘Oh, we just have to do it,’” Gonzales said, referring to discussions about certain programs. “We’d sit there and go ‘well, where does it say we’re required to do that?’”

A taxi program for the elderly, as well as Shawnee’s decorative Christmas lights, were among the programs that did not score well based on the city’s priority-based budgeting goals, Gonzales said. But she noted that the council kept both of those programs intact. She stressed that the taxi service is “a fabulous program” with benefits that far outweigh its costs.

An Easter egg hunt the city used to organize did get axed. But, Gonzales said that “a-year-and-a-half later one of the big churches in town took it on.”

For fiscal year 2016, Shawnee’s budgeted expenditures total just over $79 million and general fund spending is set at close to $48 million. “Our Shawnee budget is very lean,” Gonzales said. “We’ve pretty much whittled it down to the core things we want to accomplish.”

‘Our Other Budgets, They Were Difficult To See’

Shawnee’s priority-based budgeting model now relies on 2014 budget numbers, according to Rogers, the finance director. She said city staff are trying to get those numbers updated with 2016 figures by the time fiscal year 2017 budget discussion kick off in the coming months.

In an ideal world, she said, the city would be able to craft its traditional budget, and simultaneously update the program spending figures in the priority-based model.

But there are limits to what Shawnee can take on.

“We don’t have anybody that’s solely dedicated to budget,” Rogers explained. “There are about five or six people who really work on the budget. But we all have many other things that we’re doing.”

Even so, she believes having the 2016 program spending figures on hand during the 2017 budget-making process will provide the City Council with another lense to look through as they consider how the city is spending, and how its money should be allocated in the next fiscal year.

“It’s not perfect,” Rogers said. “But it should have some value.”

Stephanie Meyer has represented Shawnee’s Ward 3 on the City Council since fall of 2013. During her early days as a city legislator she went through one budget-making process without the priority-based system. Since then Meyer has gone through two more with it in place.

Meyer said getting a bunch of budget spreadsheets, which do not aggregate spending items up into programs can be “hard to digest,” especially for a new council member. That’s one of the reasons she prefers the priority-based approach. “I think it’s a more efficient, and appropriate, way to look at budgeting as a whole, both for the policymakers and the citizens,” Meyer said.

Michael Sandifer who has served on the Council since 2004, took a similar view.

“Our other budgets, they were difficult to see,” he said. “In some cases our line items had other things thrown into them that you wouldn’t really think would be there,” Sandifer added. “You would have to open up every line item, and study every item that’s in that line in order to know what to cut and what not to cut.”

But not everyone on Shawnee’s City Council is fond of the direction the city’s budget-making process has been moving lately. “It was very, very confusing,” Councilmember Dan Pflumm said of last year’s process. “They changed everything around.”

“I’ve been through many budget cycles,” Pflumm, who has served on the Council since 2002, said last week by phone. “When I see a spreadsheet and, you know, here’s last year’s number, here’s this year’s number and it’s a certain percentage increase, or decrease, it’s very easy to determine if that’s a good thing or a bad thing.”

Despite his dissatisfaction with how last year’s budgeting process went, Pflumm said that he is open to using the priority-based system in the future.

Measuring Success

According to Gonzales, the city manager, Shawnee’s priority-based budgeting goals are well-aligned, at this point, with the city’s strategic plan. But the city is looking to refine its budget-making efforts even further by coming up with a new set of performance measures.

“That’s kind of our next goal, is getting our performance measures even more aligned with the strategic plan and the PBB results,” Gonzales said.

The city has been using performance measures from the International City / County Management Association. But Gonzales said they hadn’t been a perfect fit for Shawnee’s needs. So staffers have been working on a customized set.

“We need those measures to be meaningful to the departments that are accomplishing the work,” Gonzales said. “We don’t want every department to have 30. We want every department to have six, or seven that really matter.”

The new performance measures could get rolled out during this year’s budget-making process.

“I really think once we get those in place, then our strategic model is in really good shape in terms of: this is who we want to be, and here is how we’re allocating our resources in the ways to get there … And here’s how we measure our success.”

After that, she added, “I think we’ll have all the pieces.”