October 10, 2011
The State of Illinois will take public testimony this week on the goals, priorities and performance measures that are being developed as part of an ongoing effort to reform the State’s annual budget process.
As previously described here, the State began a process known as Budgeting for Results in the fall of 2010 in preparation for the FY2012 budget. Under the statutory requirements passed as part of the FY2011 budget, a Budgeting for Results Commission was formed to advise the Governor in setting outcomes and goals. The law requires the Commission to submit a report to the Governor and General Assembly by November 1 of each year.
The members of the Budgeting For Results Commission were announced on August 22, 2011 and include current members of the General Assembly, local government officials, former government administrators, business leaders, government research organizations and advocacy groups. State Senator Dan Kotowski, who originally sponsored the Budgeting For Results legislation, was picked to lead the Commission as chairman.
In several meetings since August, the Commission has deliberated on the six prioritized budget results, or outcomes, of state government set forth by Governor Pat Quinn during the FY2012 budget process. These results, along with sub-goals that could be more specifically measured by state agencies to judge the effectiveness of programs, were sent out to agency directors on October 3, 2011 as part of the Governor’s budget instructions for FY2013. The instructions asked department heads not to base appropriation requests in FY2013 on the funding amount appropriated in the previous year but rather to consider how to best achieve the results and sub-goals. They were then asked to estimate how much the State should pay for those services. The instructions also included a request for information from each agency explaining which budget results and sub-goals it will meet, how the results will be achieved, how much the services should cost and how the results will be measured. The responses are due by November 1, 2011 for small agencies and by November 15, 2011 for large agencies.
The law that established the Commission requires it to hold at least two public hearings a year—one in Springfield and one in Chicago. The following two public hearings have been scheduled:
Springfield Public Hearing
State Capitol, Room 409
Tuesday, October 11, 2011
11:00 AM- 1:00 PM
Chicago Public Hearing
James R. Thompson Center
100 W. Randolph, Concourse Level
Wednesday, October 12, 2011
2:00 PM- 4:00 PM
As required by law, the Commission is reviewing approximately 1,700 statutory mandates, many unfunded, to determine if any of the mandated expenditures should be eliminated. The Commission is also considering how to include legislatively required transfers as part of overall budget deliberations, rather than allowing some of them to be automatically renewed each year.
The Civic Federation has long recommended that the State use performance measurements to ensure efficient use of government resources and supports Budgeting For Results as a positive effort in that direction. The process includes many of the steps recommended by the Government Finance Officers Association for governments seeking to transition to an outcomes-based budgeting process. The GFOA recommends that governments take the following steps:
- Determine how much money is available. The budget should be built on expected revenues. This would include base revenues, any new revenue sources, and the potential use of fund balance.
- Prioritize results. The results or outcomes that matter most to citizens should be defined. Elected leaders should determine what programs are most important to their constituents.
- Allocate resources among high priority results. The allocations should be made in a fair and objective manner.
- Conduct analysis to determine what strategies, programs, and activities will best achieve desired results.
- Budget available dollars to the most significant programs and activities. The objective is to maximize the benefit of the available resources.
- Set measures of annual progress, monitor, and close the feedback loop. These measures should spell out the expected results and outcomes and how they will be measured.
- Check what actually happened. This involves using performance measures to compare actual versus budgeted results.
- Communicate performance results. Internal and external stakeholders should be informed of the results in an understandable format.