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Explanation of the Budget
By Town Manager Josh Wright - Article 1 - 2013
As we head into the busiest part of the Town's annual budget season next month, I'd like to discuss how a few of the major components work as well as reiterate our commitment to transparency and accountability in how we conduct our financial affairs.
Private Sector
Although municipal budgets appear on paper to be vastly different from those of the private sector, in reality they're not all that dissimilar. There are still just 2 major sides to the equation - revenues and expenditures - and 1 must equal the other at the end of the day. Unlike the federal government, local governments don't print money and can't spend what they don't have.
Planning Document
One common misconception is that the town's budget reflects how much cash it has available to spend. Unfortunately, this statement is inaccurate (although it would certainly make our job a lot easier if it were true!). Rather, the budget is a planning document, assembled using our best estimates of how much money we might collect and spend based on historical trend. The reality is that town staff watches the numbers very closely throughout the year to ensure we stay on track, just like each of us does in our personal finances. If the money doesn't come in as we've planned, adjustments must quickly be made.
Cash Flow
Another common misconception is that the town is in poor financial condition or "has no money." These statements, thankfully, are also untrue. The town has actually experienced excellent financial leadership from Town Councils past and present, accumulating very little debt and managing to maintain services throughout the recent recession.
Tight Margin
Like most governments, though, Wickenburg operates on a tight margin, focusing on basic services with the limited revenue we receive. While changes can certainly be made at any time by the Council, all decisions to increase spending in 1 area must be accompanied by a decrease in spending somewhere else. The laws of physics also apply in budgeting: for every action, there is an equal, but opposite, reaction.
Through the end of the Town's fiscal year on June 30, citizens are welcome to watch their local government budgeting process play out live, either by watching study sessions and hearings on Channel 4 or by attending the meetings in person.
Questions
Town staff are also happy to meet with anyone who has questions or suggestions about the budget and how your tax dollars are spent. While final approval rests with the Council, we always approach the process with open ears and minds, recognizing that every dollar we spend is entrusted to us by you, the taxpayer.
As we head into the busiest part of the Town's annual budget season next month, I'd like to discuss how a few of the major components work as well as reiterate our commitment to transparency and accountability in how we conduct our financial affairs.
Private Sector
Although municipal budgets appear on paper to be vastly different from those of the private sector, in reality they're not all that dissimilar. There are still just 2 major sides to the equation - revenues and expenditures - and 1 must equal the other at the end of the day. Unlike the federal government, local governments don't print money and can't spend what they don't have.
Planning Document
One common misconception is that the town's budget reflects how much cash it has available to spend. Unfortunately, this statement is inaccurate (although it would certainly make our job a lot easier if it were true!). Rather, the budget is a planning document, assembled using our best estimates of how much money we might collect and spend based on historical trend. The reality is that town staff watches the numbers very closely throughout the year to ensure we stay on track, just like each of us does in our personal finances. If the money doesn't come in as we've planned, adjustments must quickly be made.
Cash Flow
Another common misconception is that the town is in poor financial condition or "has no money." These statements, thankfully, are also untrue. The town has actually experienced excellent financial leadership from Town Councils past and present, accumulating very little debt and managing to maintain services throughout the recent recession.
Tight Margin
Like most governments, though, Wickenburg operates on a tight margin, focusing on basic services with the limited revenue we receive. While changes can certainly be made at any time by the Council, all decisions to increase spending in 1 area must be accompanied by a decrease in spending somewhere else. The laws of physics also apply in budgeting: for every action, there is an equal, but opposite, reaction.
Through the end of the Town's fiscal year on June 30, citizens are welcome to watch their local government budgeting process play out live, either by watching study sessions and hearings on Channel 4 or by attending the meetings in person.
Questions
Town staff are also happy to meet with anyone who has questions or suggestions about the budget and how your tax dollars are spent. While final approval rests with the Council, we always approach the process with open ears and minds, recognizing that every dollar we spend is entrusted to us by you, the taxpayer.
By Town Manager Josh Wright - Article 2 - 2013
Local governments like the Town of Wickenburg operate on 2 fundamental principles that are the foundation of everything we do: accountability and transparency. We strive to demonstrate these core values every day in the way we interact with customers, deliver quality public projects, and use taxpayers' money to create lasting value.
Complicated Budget
As I've noted in previous columns, government budgeting is complicated. While the general concepts of revenues and expenditures are the same as 1 would have in a household or business budget, we use different terminology and are required by law to follow different regulations than individuals or private corporations.
Budgeted Vs. Spent
Many folks, understandably, become confused about how much money the town has and what's "budgeted" versus what's actually "spent." Unlike the federal government, the town doesn't have the power to overspend its budget or print money. We therefore sometimes budget more than we have on hand, hoping that we'll obtain a grant for a project or that revenues from state or local taxes will be better than in prior years. The bottom line, however, is that we can only spend what we have. If the money doesn't show up, it can't be spent.
Plan of Action
In other words, budgets are simply a "plan of action" based on our best assumptions at the time they are adopted. A separate document, called a Comprehensive Annual Financial Report, or CAFR, is produced at the end of each year and reflects what was spent and how much money the town actually possesses. The CAFR is also audited by an independent accounting professional.
Awards
Recently, the town received 2 awards for its commitment to transparency and accountability in managing our taxpayers' money, 1 each for our annual budget and our CAFR. Both awards were issued by the nonprofit Government Finance Officers Association, which puts the documents through an extensive examination by independent reviewers. Only the finest are selected for an award.
Our Team
I'm extremely proud of our town team for their stewardship of the community's financial resources. These awards help build trust in your local government and confidence in the programs we provide. It's part of a promise that our staff, and I personally, take seriously as public servants.
Local governments like the Town of Wickenburg operate on 2 fundamental principles that are the foundation of everything we do: accountability and transparency. We strive to demonstrate these core values every day in the way we interact with customers, deliver quality public projects, and use taxpayers' money to create lasting value.
Complicated Budget
As I've noted in previous columns, government budgeting is complicated. While the general concepts of revenues and expenditures are the same as 1 would have in a household or business budget, we use different terminology and are required by law to follow different regulations than individuals or private corporations.
Budgeted Vs. Spent
Many folks, understandably, become confused about how much money the town has and what's "budgeted" versus what's actually "spent." Unlike the federal government, the town doesn't have the power to overspend its budget or print money. We therefore sometimes budget more than we have on hand, hoping that we'll obtain a grant for a project or that revenues from state or local taxes will be better than in prior years. The bottom line, however, is that we can only spend what we have. If the money doesn't show up, it can't be spent.
Plan of Action
In other words, budgets are simply a "plan of action" based on our best assumptions at the time they are adopted. A separate document, called a Comprehensive Annual Financial Report, or CAFR, is produced at the end of each year and reflects what was spent and how much money the town actually possesses. The CAFR is also audited by an independent accounting professional.
Awards
Recently, the town received 2 awards for its commitment to transparency and accountability in managing our taxpayers' money, 1 each for our annual budget and our CAFR. Both awards were issued by the nonprofit Government Finance Officers Association, which puts the documents through an extensive examination by independent reviewers. Only the finest are selected for an award.
Our Team
I'm extremely proud of our town team for their stewardship of the community's financial resources. These awards help build trust in your local government and confidence in the programs we provide. It's part of a promise that our staff, and I personally, take seriously as public servants.