The city should clearly present the general fund structural deficit to the city council and the public in a budget that includes narrative and summary information to help users understand the city's budget process and its priorities and challenges, and that incorporates the elements for improved budgeting practices recommended by the Government Finance Officers Association (GFOA).
In order to address the recommendation to present the general fund structural deficit to the City Council and the public along with narrative and summary information related to the City's budget process and its priorities and challenges, staff worked to compile its inaugural "Budget Book" for release at the turn of FY 2017-2018.
The Budget Book documentation has been designed to supplement the 2017-2018 fiscal year budget by detailing the City's financial position, challenges, structural deficit, and individual department functions and expenses, with the goal of clearly depicting the City's overall economic outlook. The 2017-2018 Budget Book and related staff report were presented to Council and the public at the July 18, 2017 City Council meeting. The Budget Book is comprehensive resource that contains vital budgetary information and it is the first of its kind for the City of Vernon. Moving forward, it will be released annually along with each fiscal year budget as a companion document to the budget itself. In addition to presenting the Budget Book at its City Council meeting in July, the City has posted the document on its website in order to ensure convenient access to its content for businesses and residents in Vernon.
Staff is excited about this achievement and is looking forward to enhancing the Budget Book year over year with new, relevant information pertaining to the City and its financial status, important facts/figures, meaningful charts and graphs, and a compelling design.
On August 2, 2016, the Director of Finance presented a financial update to the public and City Council which addressed the topics of the City's investments portfolio, governmental and enterprise funds, general fund structural deficit, and provided a narrative on the City's budget process and its adherence to GFOA recommendations. The presentation that was delivered will serve as a template for future updates to review the City's financial status and ensure that the City Council and public is apprised of the most current priorities and challenges facing the City.
The City will plan to provide a detailed presentation and incorporate a discussion on the general fund structural deficit when proposing its budget to City Council in 2017.
On February 4, 2014, the City Council adopted the Budget Policies and Procedures Manual, which incorporates best practices recommended by GFOA, including Fiscal First Aid, and provides for the method of communication of budget information (see pages 7 and 12-13). These practices were implemented as part of the fiscal year 2014-2015 budget preparation process. Additionally, the Finance Director's fiscal year 2013-2014 2nd Quarter Financial Update to the City Council identified the need to address the General Fund and governmental activities structural deficit through the budget process. As part of the briefing of the fiscal year end 2015 financial statements, an indepth discussion and information will be provided on the general fund and governmental activities' structural deficit. Council will be briefed on options that will reduce the deficit amount. This will be further addressed on quarterly financial reports to the Council and in the 2016 budget cycle.
On February 4, 2014, the City Council adopted the Budget Policies and Procedures Manual, which incorporates best practices recommended by GFOA, including Fiscal First Aid, and provides for the method of communication of budget information (see pages 7 and 12-13). These practices were implemented as part of the fiscal year 2014-2015 budget preparation process. Additionally, the Finance Directors fiscal year 2013-2014 2nd Quarter Financial Update to the City Council identified the need to address the General Funds structural deficit through the budget process.
On numerous occasions throughout the two-year, collaborative process the City engaged in to address the structural deficit in the City's General Fund, staff presented numerous PowerPoint presentations to the City Council and the public at public meetings of the City Council and Business Development Committee, and at public workshops held specifically for that purpose. The presentations included graphs, charts, and narrative summaries of the City's expenses and revenues (current and projected), as well as detailed information on the City's goals, challenges, and proposed solutions. As part of the budget preparation process for the 2013-2014 fiscal year budget, City staff conducted three separate study sessions at public meetings of the City Council on May 7, May 21, and June 4, 2013, prior to the public hearing on subsequent adoption on June 18, 2013. A form PowerPoint was used by each department to provide revenue, expenditure, and staffing level comparisons to the prior two fiscal years, along with summaries of accomplishments, goals, and challenges. All meetings were properly noticed in accordance with the Brown Act and were well publicized through the City's website and the Vernon Chamber of Commerce.
The city provided its powerpoint presentations that individual departments presented to the city council which describe each departments challenges. The final powerpoint presentation is the only presentation that includes discussion of the city's general fund as a whole. There are two separate slides showing pie charts of the general fund revenues and general fund expenditures which if one compared can see there is a deficit. There is no specific discussion on the slides regarding the general fund deficit, challenges, priorities or how the city plans to address the deficit. In a follow-up with the city, the city indicates that various discussions were held and that further refinements are planned for implementation in the upcoming budget cycle. We would expect to see more narrative included in the budget documents specifically articulating the general fund deficit and the city's plan to address the deficit. Finally, the city does not address how it incorporated the budgeting practices that the GFOA recommends.
The city did not address its actions regarding this recommendation.
The city did not address this recommendation in its August 2012 response. (See 2013-406, p. 196)
Agency responses received after June 2013 are posted verbatim.