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National Advisory Council on State and Local Budgeting.

The National Advisory Council on State and Local Budgeting (Council) was established in 1995 by eight associations of state and local government, including the GFOA, and charged with developing recommended practices in the area of state and local budgeting. The Council is an unprecedented cooperative undertaking on the part of associations representing elected officials and the professional managers of local and state governments to jointly make a comprehensive assessment of the current practice of state and local budgeting. The goals of the Council are 1) to educate government decision makers about the potential of budget systems to serve as a sophisticated tool for the planning, analysis, and management of their community's resources; 2) to help them assess their own budget and resource-allocation systems; and 3) to provide them with a set of good budget practices that they can look to as a model.

The Council's work will aid GFOA members in a variety of ways. First, as a body that includes elected officials and top-level managers as well as finance professionals, academicians, and members of the public and the media, the Council will provide an authoritative voice of support for budgeting reforms or innovations. The examples and illustrations that will accompany the Council's practice statements will give members immediate, detailed guidance in the implementation of recommended practices. The Council's recommendations also will become convenient reference points for ongoing discussions and exchanges of best practices.

This national advisory council was created at the recommendation of two precursor bodies: a national symposium hosted by GFOA in January 1993, and an interorganizational task force, which concluded its work in December 1993. The symposium and task force members found that too little information on effective budgeting practices exists and that an effort to identify and share recommended practices in budgeting was needed, leading GFOA and other associations to create the Council. Other associations participating in the Council are the Association of School Business Officials International, Council of State Governments, International City/County Management Association, National Association of Counties, National Conference of State Legislatures (NCSL), National League of Cities, and U.S. Conference of Mayors (USCM). The Council is chaired by USCM representative Mayor Paul R. Soglin of the City of Madison, Wisconsin, who is assisted by vice-chair Delegate Nancy Kopp of the Maryland House of Delegates, the representative of the NCSL. Representing GFOA on the Council are past president Timothy Riordan and Alec Andrus, who chairs the association's Committee on Governmental Budgeting and Management. Also serving on the 25-member Council are representatives from labor, industry, the media, citizens' groups, and academia. The GFOA Budget Committee, an early advocate of creating national forums for the discussion of budget issues, has been tireless in providing support and technical assistance to the precursor bodies as well as the Council.

The Council's work emphasizes a long-term approach to budgeting, recognizing the benefits of the multiyear planning horizon, and highlights the unique potential for budgeting to integrate and implement other key efforts, such as the strategic plan and comprehensive land-use plan. It also underscores the importance of relating resource allocations to the achievements these allocations are expected to bring about and of linking goal setting to performance measurement and appropriations. Perhaps most importantly, the Council seeks to help governments think more creatively and comprehensively about involving citizens in the development of the budget and communicating to the public an understanding of the goals, assumptions, and tradeoffs inherent in the budgeting process.

The Council will promulgate descriptive, rather than prescriptive, practice statements that embody its recommendations. The statements are intended to serve as models, not mandatory requirements or regulations, and will be sufficiently flexible to allow for varying local circumstances. The practice statements, based on a conceptual model of budgeting prepared by the Council, cut across the functional areas of government organization and reflect political and managerial as well as the financial and technical aspects of budget development.

Recommended practices are at the heart of the Council's work. Practice statements are being prepared that stress the importance of conducting thorough community-needs assessments, with extensive input from citizens, and comparing these needs and desires with a top-to-bottom review of existing programs, services, and capital assets. To remind governments that a key component of sound budgeting is the adoption of financial policies that provide a long-term perspective, the Council has developed practice statements relating to a range of financial policies: creating stabilization funds, the use of fees and charges, weighing tax expenditures for attracting economic development, applying revenue and expenditure forecasting analyses, and other areas. Some practices deal with the establishment of an effective budget process; others speak to budget implementation, performance monitoring, comparing actual revenues and expenditures to budgeted figures, and stakeholder satisfaction with programs and services. All of the recommended practice statements are accompanied by illustrative examples from actual budgets and related documents, which are intended to spur thinking about how the practices can be implemented.

When its set of recommended budget practices is completed, the Council will develop plans for their widespread dissemination and promotion. Participating associations have agreed to incorporate Council recommendations into their publications and training programs, to pursue other means of dissemination, and to engage in cooperative dissemination efforts with other members of the Council. The Council is scheduled to go out of business after creation of the practices and dissemination plan have been completed in 1998.

The creation and work of the National Advisory Council on State and Local Budgeting is a cooperative and self-directed initiative of practitioner groups aimed at developing and disseminating best practices in state and local budgeting. As budgeting is the lens through which governments plan, make decisions, manage programs, and control resources, a new set of tools for enhancing the budgeting process carries enormous potential to improve the quality of governmental decision making and management. The contributions of GFOA members and the association's organizational support have been pivotal in furthering this path-breaking step for the profession of public budgeting.

JEFFREY L. ESSER is GFOA's Executive Director.
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Author:Esser, Jeffrey L.
Publication:Government Finance Review
Article Type:Editorial
Date:Dec 1, 1996
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