Monday, August 13, 2012

Richardson's Budget - Black or Red?

If you've been a regular reader of this blog for more than a year (I'm deeply sorry) then you know of my quest for a "balanced budget." Each year, Richardson claims to have a "balanced budget," yet often expenditures exceed revenues. What gives?

In 2011, when I last explored this subject, I came to two conclusions.

First, that Richardson considers the budget to be balanced if expenditures are less than revenues plus reserved fund balance, and other financing sources.

Second, that over a multi-year cycle that reserved fund balance sometimes has a surplus that can be drawn down, and sometimes it doesn't. So, even with the more common dictionary definition of balanced budget, one that doesn't consider reserved fund balances, Richardson's budget is cyclically balanced, even if year by year it might run slight deficits or surpluses.

Still, my hope each year is this will be a year in which Richardson doesn't rely on reserved fund balances to make up for an excess of expenditures over revenues. I vowed I wouldn't make a big deal of it again this year, but I confessed that I wouldn't be able to resist taking a sneak peek at those bottom line revenue and expenditure numbers.

After the jump, that sneak peek. Revenues vs expenditures. Black or red. Which is it?

Budget FY 2012-13
Net Budgeted Revenues: $198,370,281
Net Budgeted Expenditures: $198,235,950
Surplus/(Deficit): $134,331

A surplus! Ta-da! Woohoo! WE DID IT! A proposed budget that's in the black. Balanced by any measure, without use of that sneaky asterisk ("plus reserved fund balance and other financing sources"). Congratulations to the city staff and city council. I'm happy. See, was that so hard?


mccalpin said...

And to follow up on your comment (and enthusiasm ;-) ), the net "revenue" would have been even more than the fairly small $134,331, except that the City increased contributions to a number of funds.

Indeed, if I read the proposed budget correctly (, it appears that the General Fund should increase by somewhat more than $200,000 over the year, and the Water & Sewer Fund will increase by just under $1.4 million.

Note all funds will increase, but these are the largest two funds and show that this year is a "building" year when it comes to fund balances.


mccalpin said...

"Note all funds will increase"

should be "Not all funds will increase"

Please accept my apology for the typo...