The goal of the 2015-2016 Budget Strategy is once again to develop a budget that preserves existing levels of service provided to the community in the base budget, while maintaining cost savings and incentives for departments to continue strategic management of budget resources. Departments should develop their budget to reflect a spending plan that identifies the appropriate level of service as approved by the Board of Supervisors. Departments are encouraged to develop long-range departmental budgets. As part of the Final Budget process, the Chief Executive Office will be providing a template for modeling budgets out five years, similar to the General Fund long range model.
TIMELINE AND DELIVERABLES
Deadline Date / Requested ActionMarch 11, 2015 / Identified General Fund Departments receive Funded Service Level spreadsheet
March 17 & 31, 2015 / Board meeting to set Public Hearing for fees
March 25, 2015 / Deadline for General Fund Departments to submit Funded Service Level spreadsheet
March 27, 2015 / Chief Executive Office will issue match and General Fund contribution to departments
April 6, 2015 / Deadline to submit Proposed Budget to Chief Executive Office
April 28, 2015 / Public Hearing for all Fee Agenda Items
Please return all required documents to the Chief Executive Office attention Kellie Edwards at Monday, April 6, 2015 by 5:00 PM.
LINKS AND ATTACHMENTS
Before reading instructions, verify that you received the following department specific attachments:
· Department Memo (PDF)
· Department’s custom budget template (Word)
· Salary Projections (Access)
· Cost Allocation Plan Charge sheet by budget unit (Excel)
· Organizational Chart (PDF)
Non-Department specific files associated with the Budget Instructions can be found online at:
http://www.stancounty.com/budget/budget-instructions-main.shtm
· Department Memo (PDF)
· Budget Instructions - (this document)
· Vehicle Acquisition Form (PDF)
· Contract Summary Worksheets: over $100,000 and between $50,000 and $100,000 (Excel)
· Punctuation Consistency and New Budget Terminology (PDF)
· Staffing Template (Excel document)
· Staffing Terminology (PDF)
· Staffing Forms can now be found on the intranet at http://intranet/departments/hr/classification
- Classification Guidelines (PDF)
- Classification Process (PDF)
- New Position Request Form (Word)
- Position Description Incumbent Questionnaire (Word)
- Supervisor Information Request (Word)
- Human Resource Manager/Department Head Request (Word)
· Chief Executive Office Department Assignments
2015-2016 PROPOSED BUDGET PROCESS
All Departments
Ø The 2015-2016 Proposed Budget Instructions, will include the following for each legal budget:
o Department’s custom budget template in Word.
o The Salary Projections Program.
o Cost Allocation Plan Charge Sheet
Ø Please note that prior to preparing departmental budget submissions, departments are encouraged to review the five year revenue and appropriation history. Departments should be prepared to explain variance from historical trends.
General Fund Legal Budget Units
Ø For General Fund budgets, no net county cost will be issued. Instead, departments who are identified as being in Phase II or entering Phase II are requested to develop a “zero-based” budget for each General Fund LBU that would fully fund the current level of service and allocated positions. These departments are:
Ø Area Agency on Aging – Veteran Services
Ø Assessor
Ø Clerk Recorder & Clerk Recorder Elections
Ø Cooperative Extension
Ø County Counsel
Ø District Attorney
Ø Parks and Recreation
Ø Planning
Ø Probation
Ø Sheriff
In order to assist in the development of a common foundation for departments and Chief Executive Office staff to work from, we will use a zero based budget template/analytical tool that will assist in determining the funded service level needed for each legal budget unit. The template, including detailed instructions, will be shared with impacted departments by Wednesday, March 11th with a requested return date of March 25.
Departments are encouraged to continue preparing their proposed budgets with the following assumptions:
o All positions included in the Salary Projection are fully funded.
§ Departments are required to add Step/Pay for Performance increases and block-budgeted promotions.
§ Salary Projections are based on a Budget Year that has 2096 hours.
§ Positions for which dedicated funding (grants, contracts, etc.) has diminished or been eliminated will not be backfilled with General Fund dollars.
§ Long-standing vacancies for which funding has not been available should be moved to the unfunded list. Chief Executive Office staff will review these with departments.
o If extra-help/overtime/contract employees are needed to preserve your current service levels after funding allocated positions, please include those costs and be prepared to validate them.
o All Cost Allocation Plan charges are fully funded.
o Services and Supplies and Fixed Assets should be funded within a range similar to the 5-year average of those costs.
§ Requests that fall outside the 5-year average range should be explained.
o Revenue projections should be based on knowledge of the programs.
o New programs or positions that have not been previously authorized by the Board of Supervisors should NOT be included in the zero-based budget.
Ø Chief Executive Office staff will review each General Fund budget with departments. In reviewing, it is expected that Chief Executive Office staff and departments will agree to the level of General Fund support (“funded service level”) required to provide the current level of service. As part of the review process, Chief Executive Office staff will reduce department budgets to assume a 5% vacancy factor for all allocated positions. Departments with 10 or fewer allocated positions will be exempt from the 5% vacancy factor.
Ø In the event the funded service level is greater than the 2014-2015 General Fund contribution, departments are expected to use any existing net county cost savings to absorb the additional need. If a department does not have sufficient net county cost savings to absorb the additional need, the department’s issued base will be revised.
Ø In the event the funded service level is less than or equal to the 2014-2015 General Fund contribution, departments will receive the same amount as the 2014-2015 General Fund contribution.
Ø Upon reaching agreement, Chief Executive Office staff will issue the General Fund funded service level “base” amount to departments and will enter that amount into the Budget Submittal System.
All Departments
Ø By the April 6, 2015 deadline date, all departments are expected to enter in their funded service level budget into the Budget Submittal System. Departments may also use the System to request unmet needs in the event there are other needs such as requests for additional staffing or new programs. Also by this date, departments should complete the narrative in each LBU template, and submit any additional forms needed such as any staffing requests, Contract Summary Sheets and/or the Vehicle Acquisition Form.
AREAS OF IMPORTANCE IN THE DEVELOPMENT OF THE 2015-2016 PROPOSED BUDGET
General Fund Contribution (Net County Cost) – As mentioned above, General Fund departments will not be issued a net county cost number. The Departments and the Chief Executive Office will determine a mutually agreed upon General Fund Funded Service Level base amount.
Match Departments – Match departments will continue to be supported at the lower of the prior year Adopted Final Budget level, or the minimum mandate level if program requirements have changed. The departments and the Chief Executive Office will determine a mutually agreed upon Approved Match amount for 2015-2016 prior to March 27, 2015.
General Fund Net County Cost Savings – All General Fund Departments anticipating net county cost savings carryover, must estimate funds as part of the 2015-2016 Proposed Budget submittal. The request should include an estimate of the calculated net county cost savings and an explanation of the planned use of the carryover funds. Once the Oracle Financial Management System is closed for Fiscal Year 2014-2015, the Chief Executive Office will work with departments to finalize the net county cost savings amount. Going forward, a strategy has been developed to appropriately fund current levels of service in General Fund budgets once all net county cost savings have been exhausted, while maintaining an incentive to allow Departments to benefit from continued efficient operations. The goal is for departments to be funded at the service level needs.
Phase I – Net County Cost Savings Program – Department will remain in the current net county cost savings program until any additional General Fund contribution has been received. Funds are to be used as first resource for any department needs.
· Fiscal Year 2014-2015 – 75% of the net county cost savings.
· Prior Fiscal Years – 100% of the net county cost savings.
Phase II – Strategic Savings Program – Once Departments receive additional General Fund contribution, Departments will participate in the Strategic Savings Program.
· Departments may be eligible to carry forward up to 50% (may be less) of year-end net county cost Savings.
· The program focus is on rewarding improved business efficiencies and department led efforts to improve departmental revenue.
· Departments are required to submit information during the 2015-2016 Proposed Budget Process on how the year-end savings have been developed.
· The Chief Executive Office will determine eligibility for each department based on department budget submission. Savings generated by vacant positions generally does not qualify for year-end carry forward. Qualifying examples are:
i. Department receives increased revenue based on advocating for increased program funding at State/Federal level.
ii. Department implements improved business process which reduces the cost of providing services.
iii. Department identifies multi-year funding strategy to address known future cost liabilities not funded through the budget.
iv. Department initiated strategies to re-prioritize non-salary related expenses to create additional capacity.
Operational Priorities - Departments are requested to list three to five prior year accomplishments as well as three to five budget year objectives. Please consider how these objectives support the County vision and strategic priorities as well as the Department’s Mission. Departments are encouraged to include at least one objective focused on customer service enhancements as well as an objective tied to Focus on Prevention for the 2015-2016 Budget Year.
Risk Management Charges – As in previous years, General Liability, Unemployment, and Workers’ Compensation charges are being issued with the 2015-2016 Proposed Budget Instructions to all departments and are based on the funding of significant program expenditures. The following highlights the changes in department charges:
General Liability – Department charges for the General Liability Program are being increased by approximately $600,000 due to projected increases in excess insurance premiums. The budget will provide funding to pay back $450,000 of the fund’s $970,000 retained earnings deficit, consistent with the five-year payback plan approved by the Board of Supervisors.
Health Insurance – The cost to departments for health insurance (including medical, dental, and vision) is included in the salary projections program and has increased by approximately 1% overall for most departments beginning January 2015. Health Insurance costs for calendar year 2016 are unknown and will be determined after a thorough analysis of the self-insured medical, dental, and vision programs later this calendar year. It is recommended departments model an 8 - 10% increase in medical, dental, and vision costs beginning January 2016.
Unemployment Insurance – The quarterly Unemployment Insurance Benefit charges from the State remain stable. As a result, Unemployment charges will remain at $50 per employee for Budget Year 2015-2016.
Workers’ Compensation – The Workers’ Compensation excess insurance premium is anticipated to increase slightly in Budget Year 2015-2016 due primarily to the increase in payroll costs for the entire County. Sufficient retained earnings exist in the Workers’ Compensation Fund to cover this cost, so department charges will not increase overall. Individual department charges may vary, however, due to changes in staffing and claims paid in the last ten years.
Safety Incentive Program – If your budget includes funding for a Safety Incentive Program, please use Account Number 62401 when entering your numbers into the budget submittal system. Using the correct account number allows the County Safety Board to review and promote the County’s safety program. Costs that should be posted to this account are associated with rewarding employees for their safety efforts (for example, gift cards, luncheons, certificates of commendation, continental breakfasts, etc.).
Salary Projections – Salary Projections are included in the 2015-2016 Proposed Budget Instructions. The Salary Projections were downloaded on February 6, 2015.
Cafeteria Health – The amount for the plan changes that take effect January 1, 2015 are reflected in the Salary Projections.
Retirement – Budget Year 2015-2016 salary projections include retirement rate increases of 1.25% percentage points for safety and no increase for miscellaneous members over Fiscal Year 2014-2015 rates. This is the second year of the Board of Retirement approved two-year phase-in of the funding methodology required by the Government Accounting Standards Board (GASB). It is anticipated that departments will not experience significant increases in salary costs due to retirement rates. It is however unknown at this time if the Board of Retirement will make any additional changes that would impact the 2015-2016 Budget Year employer rates.
Vacancy Rate – For General Fund departments, the Chief Executive Office will reduce budgets to assume a 5% vacancy rate for all allocated positions. Departments with 10 or fewer employees are exempt from the 5% vacancy factor.
Unmet Needs – Departments that determine additional funding is required above the Funded Service Level needs, should describe the additional requested funding in the Program Discussion section of the template and should enter the unmet need amount into the Budget Submittal System. These additional needs will be reviewed by the Chief Executive Office and if approved, recommended in the 2015-2016 Proposed Budget.
Utilities – The Utility CAP charges include increases based on type of utility, including 4% for Modesto Irrigation District (MID) customers, 4% for Turlock Irrigation District (TID) customers, 6.8% for PG&E and 4.25% for all other utility payments.