BUDGETING

by Alvin Keller Department of Local Government Affairs

A budget is a comprehensive plan of proposed programs for a given period of time. In a budget, the services, activities and projects comprising the program are spelled out along with the expenditure requirements and the available resources for their support.

Illinois Park Districts are required by law to annually adopt a combined Budget and Appropriation Ordinance either before or within the first quarter of each fiscal year.

The budget must contain a statement of the cash on hand at the beginning of the fiscal year, an estimate of the cash to be expected to be received from all sources during the fiscal year, a statement of the estimate of expenditures contemplated for the fiscal year and an estimate of cash expected to be on hand at the end of the fiscal year. Since legal requirements and generally accepted governmental accounting practices require fund accounting, the cash balances as well as revenues and expenditures should be on a fund basis.

It is well for each Park District to devise its own budget calendar, setting times for various phases of the budget process to be accomplished. The budget calendar should also state what activity is to be performed on said date and whose responsibility it is to perform that function.

Since budgeting is only one step in the planning cycle of planning, budgeting, levying, accounting and reporting, it is imperative that uniform terminology be used throughout. A Chart of Accounts should be devised which will be used in the budget preparation. This same Chart should be used in the tax levy document. The books of the district should reflect these same accounts. Later the periodic reporting will be on the same basis, so that comparisons can be made on progressive expenditures as against budget estimates. Thus management can enforce administrative fiscal control.

Legal requirements allow broad leeway in breakdown of information in the budget. However, efficiency demands detailed breakdown. The more minute and departmentalized a budget is, the more information a reporting system will furnish to the commissioners and the more accurate will be the budget forecasting in future years.

A balanced budget is essential. The statutes provide the tools for this, when they require the listing of the starting balances, listing of revenues and expenditures and computing an estimated ending balance. The mathematical equation will allow for a balance. If it does not, then the budget should be reworked and reduced to allow for a balance.

Citizens are becoming more sophisticated in ways of government, and are becoming more involved and concerned about their public bodies. Therefore, it behooves administrators to do a responsible job of fiscal control. The budget is the "bible" and the legal basis to all programs to be undertaken during the year.

In the budget, revenues should be started under such major headings as Taxes, Revenue from Use of Money and Property, Revenues from other State Agencies, and Other or Miscellaneous Income.

Taxes, of course, indicate Property Taxes and could further be broken down, if desired, between Receipts from Current Taxes and Receipts from Prior Year Delinquencies. This information can be obtained from the county treasurer.

Revenues from use of Money and Property would include such minor classifications as Rental Income, Receipts from Concessions, Income from Investment of Funds, Sale of Fixed Assets, and could include Receipts from Various Program Activities (detailed by activity if the authorities so desire).

Revenues from other agencies would include State Grants, Federal Grants, and possibly Grants from other Intra-state Local Governments.

Other income headings could include Inter-fund Transfers, Donations, Miscellaneous Income and Program Fees (if not listed under major heading of use of money and property).

On the expenditure side of the budget, generally accepted governmental accounting practices dictate major classification of Personal Services, Contractual Services, Commodities, Other Expenses, Short Term Debt Retirement, Long Term Debt Retirement and Capital Outlay.

Under Personal Services, there could be further breakdown: Salaries, Retirement Contributions, Hospital Insurance and Other Employee's Insurance.

Contractual Services would include such further subdivisions as Maintenance of Building, Maintenance of Grounds, Telephone, Utilities, Travel Expense, Training Expense, Legal Fees, Professional Dues and many other services contracted depending on size of district.

Under Commodities, a further breakdown

Illinois Parks and Recreation 10 January/February, 1976

would itemize Office Supplies, Other Supplies, Gas and Oil, etc.

Other expenses might include Interest Payments, Judgments and Claims and Sundry Expenses.

The Short Term Debt Retirement classification would cover expenditures in repayment of tax warrants that might have been issued in anticipation of tax receipts.

Long Term Debt classification would be the category used to budget the scheduled retirement of outstanding bonds issued by the district. Capital outlay classification would be used to list such minor classifications as Land Purchase, Purchase of Building and Permanent Improvements other than Buildings and Equipment.

Closely following these suggestions should insure good fiscal planning for the Park District or the Park Department of a municipality.

Additional information can be obtained from Alvin J. Keller, State of Illinois, Department of Local Government Affairs, 303 East Monroe Street, Springfield, Illinois 62706.

Illinois Parks and Recreation 11 January/February, 1976