Sample Budget Model - Management Partners · 2018-08-02 · Sample Excerpts from a Recent Budget Model Every budget model prepared by Management Partners has a “control panel”

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Management Partners Financial Sustainability for Local Governments Sample Excerpts from a Recent Budget Model

Every budget model prepared by Management Partners has a “control panel” in which major variables are located. Successive screens of assumptions appear by paging down. The key fund balance chart is always visible, showing the net impact of recessions, PERS discount rate cuts, COLA changes, added costs, staffing increases, potential cuts and new revenues.

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A comprehensive dashboard of over 30 charts is organized by topic, and updates automatically as assumptions are revised.

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An interactive graphing function shows historical and projected amounts for all revenue and expenditure categories in the forecast. Short-term and long-term trend lines provide context for the projection. The impact of revised growth rates can be immediately seen.

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The forecast is compiled using key cost drivers and revenue sources, in a manner consistent with the agency’s traditional budgeting. The model is designed to be used in a public setting, where the impacts of alternative scenarios can be changed on the fly, either manually or by using pre-programmed macros, and the impact immediately observed. This makes the budget model more than a static forecast: it is a powerful decision-making tool that demonstrates the parameters for long-term financial sustainability. (The balanced scenario below results from sample changes highlighted in pink.)

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The budget model typically focuses on the General Fund. While it contains detailed financial history and calculations of personnel and other costs, it includes a summary of the forecast and assumptions for easy reference.

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The budget model file belongs to the local agency, and staff is encouraged to continue to update the file and use it in future years. The forecast it produces is not a substitute for the agency’s budget process, during which its near-term spending priorities are established, but as the Government Finance Officers Association states in its Best Practices: “The forecast is an integral part of the annual budget process. An effective forecast allows for improved decision-making in maintaining fiscal discipline and delivering essential community services.”

For information contact: Andy Belknap, Regional Vice President: [email protected] (805) 320-1702

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Sample Budget Model - Management Partners · 2018-08-02 · Sample Excerpts from a Recent Budget Model Every budget model prepared by Management Partners has a “control panel”