HOUSTON COUNTY BUDGET PREPARATION PROCESS

Presented by:Bill Dempsey, CAO

CALCULATING DEPARTMENTAL EXPENSES

We divide our departmental expenditures into three different categories:

1)Salaries and Benefits

2)Operations

3)Capital Expenditures

FY 13-14 Total 13-14 $ Variance $ Variance FY 12-13 Actual Amended Actual / Projected 14 Budget vs FY2014-2015 Budget to

Object Fund Department/Function Number Expenditures Budget Expenditures 14 Actual/Proj Budget Budget

001 Accounting 51110113 Other Salaries and Wages 50,468 52,292 52,060 (232) 54,359 2,067116 Overtime 0 0 0 0 0 0121 Retirement 3,163 3,629 3,612 (17) 3,952 323122 Health Insurance 9,658 9,998 9,928 (70) 9,998 0123 Life Insurance 47 47 50 3 50 3124 Social Security - FICA 3,635 4,000 3,822 (178) 4,158 158125 Worker's Compensation 255 224 231 7 199 (25)126 Unemployment Insurance 0 0 0 0 0 0140 Compensated Absences 0 0 0 0 0 0

TOTAL SALARIES & BENEFITS 67,226 70,190 69,703 (487) 72,716 2,526

170 Training/Educational Service 0 0 0 0 0 0171 Organization & Assoc Fees 25 25 25 0 0 (25)191 Other Professional Services 2 2,000 0 (2,000) 2,000 0192 New Employee Physical Exams 0 0 0 0 0 0195 Contract Services 101 100 100 0 100 0207 Safety Supplies 0 0 0 0 0 0211 Office Supplies & Minor Office Equipment 8,506 11,800 11,400 (400) 12,000 200219 Other Misc Supplies 0 0 0 0 0 0228 Copier Service Charge 0 0 0 0 750 750233 Repairs & Mtce-Office Equipment/Copy 1,545 1,500 1,500 0 1,600 100235 Repairs & Mtce-Data Processing Equipment 4,080 4,080 4,080 0 4,800 720252 Postage 2,487 3,000 3,000 0 3,500 500253 Advertising 1,134 1,350 1,134 (216) 1,350 0259 Long Distance Service 0 0 0 0 0 0262 Mileage 0 0 0 0 0 0264 Lodging & Meals 304 455 407 (48) 525 70265 Meeting & Conference Fees 260 535 535 0 555 20266 Gasoline for County Vehicles 0 0 3 3 12 12273 Surety Bonds 61 121 55 (66) 55 (66)274 Insurance-General Liability/Theft 1,787 1,588 1,601 13 1,390 (198)410 Books and pamphlets 0 0 0 0 0 0425 Bank Service Charges 2,253 0 0 0 0 0631 Long Term Debt - Principal 0 2,300 0 (2,300) 0 (2,300)

TOTAL OPERATING EXPENSES 22,545 28,854 23,840 (5,014) 28,637 (217)

541 Equipment & Furniture-Direct Cost 0 0 5,010 5,010 0 0581 Central Processing Units 0 0 0 0 0 0583 Printers 0 0 0 0 0 0

TOTAL CAPITAL PROJECTS 0 0 5,010 5,010 0 0

Total Expenditures 89,771 99,044 98,553 (491) 101,353 2,309

Houston County CommissionBudget Comparative Analysis & Projections

JUNE SEPTEMBER

Mid-June we hold our departmental manpower, capital and major expense meeting for the coming year.

Around July 10th we hold our departmental operations meeting in which department heads are given their operations budget expenditure target for the coming year.

E/July department heads submit their operations budget estimated expenditures for July ~ September and their coming years operation budget object detail based on their operations budget target.

During July, using our revenue data base, departmental input and/or abstract calculations, the CAO determines projected yearly revenues for the current and new year.

This step is repeated in late August.

By early August, prepare first-pass budget. Throughout August we tweak the budget with Commissioners and Department Heads.

Target final budget approval the first Commission meeting in September.

THE BUDGET PROCESS INCLUDES FORECASTING REVENUE & EXPENDITURES FOR JULY – SEPTEMBER IN THE CURRENT YEAR AND REVENUES/EXPENDITURES FOR THE NEW YEAR.

EXPENSE CALCULATIONS: Labor & Benefits, Capital and Other Major Expenditures

During this mid-June meeting, any department head that seeks to add people, add capital equipment or requests funding for a major spending project (other than normal Road and Bridge projects) presents their detailed justification to the Commission.

This is typically the only detailed meeting that the Commission will have with department heads. Due to the nature of the meeting, only a few department heads will meet with the Commission.

The final filtered outcome from this meeting will provide the basis for our coming year’s labor/benefits and capital expenditure budgets.

EXPENSE CALCULATIONS: Departmental Operations Budget

Key departments are given a bottom-line operations budget expense target. Within this target each department is expected to allocate their expenses to include departmental spending, property insurance allocation, liability insurance calculations and lease costs.

CALCULATING DEPARTMENTAL OPERATIONS BUDGET TARGETS

CURRENT YEAR’S OPERATIONS TARGET- CURRENT YEAR’S EXTRAORDINARY EXPENSES

+ NEW YEAR’S EXTRAORDINARY EXPENSES+/- ADJUSTMENTS FOR INSURANCE, LEASE COST, ELECTRICAL AND OTHER

ALLOCATIONSCOMING YEAR’S OPERATIONS BUDGET TARGET

Upon receipt of their operations budget target, department heads allocate their departmental expenditures object-by-object so that their bottom line operations budget does not exceed their allowed expenditure.

REVENUE CALCULATIONS

We use three sources of information for calculating revenues:

1)Revenue Tracking Data Base

2)Abstract Calculations (from the Revenue Department)

3)Department Head Recommendations

Most of our revenue forecasts are done through the use of a Revenue Tracking Data Base.

111-44190-8307 cent gas tax Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June Jly Aug Sept. Ttl.

2008/2009 Act. 102680.01 133858.17 120921.05 118898.64 123950.65 117234.85 120735.65 130581.38 131140.88 125062.07 137705.85 131484.34 1494253.542009/2010 Act. 111863.97 128314.17 122570.30 119460.71 120843.95 119126.18 123498.84 133463.98 137122.49 122375.36 138925.87 137237.18 1514803.002010/2011 Act. 113551.09 132191.82 125191.80 118981.64 116761.00 118119.28 119731.52 127066.01 134918.62 122140.23 133002.02 128817.41 1490472.442011/2012 Act. 114280.11 132924.02 126957.84 121558.53 123576.57 125235.23 124953.64 132563.81 139384.88 124711.58 136635.98 139472.15 1542254.342012/2013 Act. 108831.53 124077.12 137647.14 117886.35 122109.07 118295.02 123791.26 132163.62 140025.48 122208.88 138168.62 139426.90 1524630.992013/2014 Act. 112348.37 135208.19 126870.28 117463.21 123273.92 117745.11 121286.09 134142.46 140325.79 122785.70 142396.30 138003.94 1531849.36

Total actual 663555.08 786573.49 760158.41 714249.08 730515.16 715755.67 733997.00 789981.26 822918.14 739283.82 826834.64 814441.92 9098263.67YTD % 0.07 0.09 0.08 0.08 0.08 0.08 0.08 0.09 0.09 0.08 0.09 0.09 1

2014/2015 Budget 1534000.00Actual Received 114613.29 141782.38 124774.76 122347.30 503517.73

Projected Received 111877.77 132619.12 128165.44 120424.97 123167.49 120678.98 123754.54 133193.68 138746.96 124645.91 139407.30 137317.84 1534000.00Monthly Variance 2736 9163 -3391 1922 -123167 -120679 -123755 -133194 -138747 -124646 -139407 -137318 -1030482.27

YTD Actual Received 114613 256396 381170 503518 503518 503518 503518 503518 503518 503518 503518 503518YTD projected receipts 111877.77 244496.90 372662.34 493087.31 616254.79 736933.77 860688.31 993881.99 1132628.95 1257274.86 1396682.16 1534000.00

YTD Variance 2736 11899 8508 10430 -112737 -233416 -357171 -490364 -629111 -753757 -893164 -1030482

REVENUE TRACKING LOG

IN EARLY AUGUST WE COMPILE ALL EXPENSES AND REVENUES TOGETHER FOR OUR FIRST-PASS BUDGET

ESTIMATE

Revenues – Includes grants, normal revenues and projected unusual or one-time revenues.

Expenses – Departmental Expenses (Labor/Benefits, Operations/Capital)

Agency DonationsLong Term DebtGrant Spending

(EXAMPLE)

Current year beg. FB: $5,000,000 New Year est.FB: $3,800,000

Current years est. rev.: $4,700,000 New Year est. rev: $4,850,000

Current years est. exp.: $5,900,000 New year est.Exp: $5,300,000

Ending FB current year: $3,800,000 New Year est. end FB: $3,350,000

After arriving at a first-pass estimate ending fund balance for the new year we begin tweaking expenses and revenues to arrive at our final targeted ending total FB.

FINAL BUDGET BY FUND BALANCE

After arriving at the Commission-authorized bottom-line fund balance, we prepare a fund allocation summary sheet.

NOTE:All money from all funds are included in one normal checking account (Exception: We have created special flow-through checking accounts for payroll and flex payments). We create the Funds Summary through detailed planned transfer of money between projected ending fund balances.

Projected ProjectedBeginning Proposed Proposed $ Variance NET Net Ending

Fund Balance Revenues Expenditures Expenditure (FB+Rev-Exp) Operating Fund BalanceFund Fund Name 10/1/2014 -Yearly- -Yearly- To Revenue Transfers 9/30/2015

001 General 7,012,247 16,615,246 20,174,316 (3,559,070) 3,453,177 1,039,913 4,493,090001 General Fund Grants 0 44,399 10,596 33,803 33,803 0 33,803003 Contingent Fund 4,015 0 12,000 (12,000) (7,985) 7,985 0006 Special Assessment Fund 530,796 0 5,000 (5,000) 525,796 0 525,796010 Farm Center 0 30,623 295,432 (264,809) (264,809) 264,809 0015 Sanitation 0 135,391 2,204,863 (2,069,472) (2,069,472) 2,069,472 0015 Sanitation Collections 0 2,065,000 257,384 1,807,616 1,807,616 (1,807,616) 0020 EMA 0 10,881 265,977 (255,096) (255,096) 255,096 0020 EMA Grants 237 98,565 50,952 47,613 47,850 0 47,850021 APCO Rep 96,479 82,485 82,878 (393) 96,086 0 96,086021 APCO Grants 0 0 0 0 0 0 0030 Revenue Commission 11,776 601,267 623,369 (22,102) (10,326) 10,326 0

0Total General Funds $7,655,550 $19,683,857 $23,982,767 ($4,298,910) 3,356,640 $1,839,985 5,196,625

111 Gasoline 0 2,921,701 10,233,222 (7,311,521) (7,311,521) 7,311,521 0112 Public Bldgs, Rds & Bridges 0 9,716,093 0 9,716,093 9,716,093 (9,716,093) 0113 Public Highway & Traffic 0 166,000 0 166,000 166,000 (166,000) 0117 RRR Gasoline Tax 0 1,248,000 0 1,248,000 1,248,000 (1,248,000) 0118 Secondary Road 0 0 0 0 0 0 0119 Special Five Cents Gas Tax 0 433,991 0 433,991 433,991 (433,991) 0

Total Road and Bridge Funds $0 $14,485,785 $10,233,222 $4,252,563 4,252,563 ($4,252,563) 0

115 AL Mineral Severance Tax 0 7,200 0 7,200 7,200 (7,200) 0116 Capital Improvement Fund 0 415,000 0 415,000 415,000 (415,000) 0120 Tax Reappraisal Fund 24,931 591,620 614,808 (23,188) 1,743 0 1,743125 Walden Gas Tax (Net) 0 97,506 56,104 41,402 41,402 (41,402) 0

Total Special Revenue Funds $24,931 $1,111,326 $670,912 $440,414 465,345 ($463,602) 1,743

300 Debt Service Funds 376,394 0 3,513,719 (3,513,719) (3,137,325) 3,137,325 0136 Trust Funds 20,887 3,000 2,500 500 21,387 0 21,387

187/ 188 Community Corrections/Wrk Rel 234,212 945,576 918,643 26,933 261,145 (261,145) 0

Total Funds $8,311,974 $36,229,544 $39,321,763 ($3,092,219) 5,219,755 $0 5,219,755

Houston County Commission Funds Summary

FY 2014-2015

• The final budget is normally presented for approval during the first scheduled Commission meeting in September.

• In November we present to the Commission a departmental over/under report indicating any overspending by a department for the prior year and the reason why. Commission authorization is requested to accept the overspending.

• In November we reconcile the prior year’s actual ending fund balance with the projected ending fund balance. If our projected ending fund balance is less than we estimated, we must adjust spending accordingly throughout the expenditure budget.

• Throughout the year the CAO is authorized to approve budget adjustments between objects within a department so long as the total adjustments do not increase that departments annual approved spending budget.