Is having the Budget Committee a good idea?

[MattPublicover]

Gary Krupp posed this question at Candidates' Night and also on this forum:

Given that the sum total of all budget committee changes in the last 5 years represents only two-tenths of a percent (0.2%) of this year's total operating budget, how would you characterize the need for this committee on a spectrum ranging from unnecessary bureaucracy to absolutely essential oversight?

I think the question is important and deserves its own thread.

To answer you, Gary, I believe Merrimack would be better off without this Budget Committee, but not because it has made few changes to the budgets over the past years. The reasons go deeper than that. Here they are:

1) The Budget Committee is too weak to perform the job it should be able to perform. It was pointed out frequently that cuts, additions and lateral moves of money can all be ignored by the School Board, which is the body charged with managing the school system. Therefore, the only change the BC can implement that they can actually make stick is a bottom line cut that is so deep no surplus can be expected to cover it. I think it is not simply not helpful, I think it is dangerous to have a committee whose only tool is not a scalpel but a machete.

2) The Budget Committee interferes with the voice of the people in the school budgeting process. Sounds contradictory, but because the budget that gets presented at the deliberative session is technically the BC's budget, the BC is the body that holds the only public hearing on the budget, at the very tail end of the process, when it is extremely hard to make any changes. Even if residents made good arguments at the public hearing, sufficient to convince the BC to make last-minute changes, the BC is too weak to enforce those changes if the School Board disagrees. If the BC did not exist, the School Board would be the one to hold the public hearing -- and they are the body that has the power to make changes in how the money is actually spent. People currently have the right to speak to the SB during the budgeting process, but a public hearing is the time officially set aside for the voice of the people, and is the time likely to attract the greatest response from residents.

3) The Budget Committee is anti-democratic by its nature. The predecessor to this School Budget Committee was a Municipal Budget Committee, which had a unique function in town. It was the only one to look at all three budgets (town, school, water district) and make recommendations. But the School BC only looks at the school budget. Residents should have the right to elect the officials who are responsible for taxing us and spending our money. The residents have such an elected body -- it is called the School Board. If the elected BC changes the SB's budget, it is in effect taking away the authority of the elected representatives of the people. And when you stop to think about it, the School Board and the Budget Committee are elected by the same constituency, the same voters, in the same elections -- why would the voters seek different viewpoints on the two committees? Why would they want the two boards to disagree?

4)The Budget Committee is anti-democratic in practice. It is a large, 12-member body in a relatively small town. Over the past 5 elections, there have been a total of 30 seats up for grabs, and almost all of those seats have been unopposed. A representative board should offer the voters a choice of opinions (as I have stated elsewhere) or it cannot be said to truly represent the views of the majority except by chance. The School Board, on the other hand, is a small, 5 member board. Residents treat it as a more important board, and therefore it is extremely rare to have uncontested School Board races. Personally, I would rather put the budget decisions in the hand of the elected board that represents the majority's choice.

Creating the Budget Committee was a reasonable idea in the beginning, but actual practice has led me to the conclusion that the residents and the School District would be better off without it. No change in the membership of the committee would solve its structural problems, and in the hands of the wrong folks, the BC could be a destructive weapon. For the sake of efficiency, democracy, and giving more of a voice to the people in the School District budgeting process, I suggest residents give serious thought to the merits of a change.

[andysinnh]

Matt - I certainly want to respond to this in more detail, but won't be able to until this evening. But I wanted to put in a quick note that I'm a bit concerned that the labels you placed on the 4 areas of concern are very misleading, especially if someone just decides to quickly glance at your post and not read the details. I personally believe that there are areas for improvment in the way the bud comm operates, and if you remember correctly I tried to get the membership to look at ways to change this year. We took some small steps, but more are obviously available to us. But using words like "weak", "interferes" and "anti-democratic" I believe aren't really accurate in describing how the bud comm itself could exist - and frankly very misleading to the concept of the committee itself. I'll expound on that in my more detailed response later today.

andy

[Jeannine Stergios]

I believe budget committees in other towns have more license to make cuts than they do in Merrimack. Is this because of the rules in place in Merrimack? Or is it possible that our Budget Committee hasn't bothered to challenge the status quo?

I would like to know because as Mr Publicover states, what's the point when there's so little change? I had hoped with a new Chairman we would see more changes, but if the committee's role is so limited, then it's worthless and not what the taxpayers intended.

[ggkrupp]

Thanks Matt for reposting my question as it is a topic that I am interested in gaining more perspective on. A couple of items came to mind when reading your initial post.

- Because most BC elections are unopposed, does that necessarily make it undemocratic? That COULD happen for any office, right?
- Is having two elected bodies (SB & BC) with budget responsibilities all that different from the House and the Senate, the Governor and the Council or a number of other checks & balance systems with overlapping responsibilities that exist in all levels of Government?
- Is efficiency the goal in getting through the budget process? Or are voters looking for a deliberate thorough vetting of the budget?
- The BC clearly has authority in my read of the RSA but has been unwilling or unable to exercise it for whatever reason (Admin & SB did their work and put tight defend-able budgets forward or maybe the BC has been too fragmented to agree on changes or any number of other potential causes). Is that such a bad thing?
- Many talk to the relative low cost of the Budget Com but there are costs in having school officials propose and defend budgets to three bodies (Admin, SB & BC). Is this overhead worth it when relatively small changes if any are ever made by the BC?

[Tim Tenhave]

Hi Matt,

I agree...period...thanks for posting your observations. This is what I said 4 years ago would be the case and your perspective shows that I was not far off of the mark.

To All,

I would like to add:

The Budget Committee has no responsibility for its vote and does not have to live with the consequences. Yes the members have to worry if their vote will prevent them from being reelected but I also realize many have no fear of that given there is no line waiting to be elected. The truth is that the BC can change the bottom line but if they do change it, they don't have to live with it. The Administration and SB has to deal with the budget the Voters pass. They have skin in the game you might say. The BC goes home after the deliberative session and does not have to deal with any consequences (except for possibly being the parent of a child in the system or being a taxpayer). If the BC had skin in the game and had to make tough decisions to stay within the budget, it would be a better system. At the Deliberative Session it is moved and talked to by the Budget Committee Chair and members. That is where it ends.

Jeannine,

Our BC is governed by the State RSA's as are most others. Because ours behaves differently is their decision.

Gary,

Yes, it is all that different. The BC does its work during budget season and then does not have to deal with any consequences. The House and Senate deal with their decisions.
You are right there is a cost for the BC. The cycle time for a budget is extended. It means the administration has to start 8-10 months ahead of when the budget takes effect and they have to have a crystal ball to anticipate the economy, enrollments, etc. The SB has to start 6-7 months ahead, etc. This lengthing of the process keeps the SB from being agile and adjusting as circumstances change. Just look at the recent SB action to reduce the BC budget by $500K. The whole process could shift to the right without a BC and keep the responsible body in charge of directly selling/defending their budget that in the end they have to live with.

Tim

[MattPublicover]

Gary, you posed some follow-up questions. I thought I would give other people a chance to weigh in first, but here now are some of my thoughts.

- Because most BC elections are unopposed, does that necessarily make it undemocratic? That COULD happen for any office, right?

Right. The design of the committee is not anti-democratic, as the possibility has always been there to have choice among candidates. It has only been de facto undemocratic because of the consistency with which a lack of choice is presented to voters. I think the fact that 5 years running there has been little or no choice is statistically unlikely, leading me to the conclusion that the structure of the committee is inappropriate for a town our size.

It is similar to the old town meetings and school district meetings, which always provided every voter a chance to speak -- but the residents opted to go to an SB2 form of government because in actual experience, many people found they could not find the time to attend the meetings. Town meeting was more democratic in design, but less democratic in actual experience, and the difference was related to the structural limitations of the meeting. Same is true of the Bud Com elections. Perhaps a smaller committee would have more of a chance to produce contested elections and voter choice in a town the size of Merrimack.

[MattPublicover]

Gary, as for your next question:

- Is having two elected bodies (SB & BC) with budget responsibilities all that different from the House and the Senate, the Governor and the Council or a number of other checks & balance systems with overlapping responsibilities that exist in all levels of Government?

The examples you quote are not comparable. In the House and Senate, one body cannot completely ignore the decisions of the other body if it so chooses. Legislation does not proceed unless they come to agreement. The Bud Com does not meet formally with the School Board at any point to hash out any differences of opinion. The Bud Com is not a co-equal body with the power to change the way the money is spent, as its decisions can be ignored in most cases by the body with executive power.

The Governor, like the president of the US, does not originate legislation, but can suggest it, and has end of the road veto power. The legislatures have the power to override vetos, but only with a significant majority. Executive and legislative have different roles and responsibilities. But the Bud Com has no function other than to duplicate the budget review already performed by the SB. It does not look at town and Village District budgets. Except for the viewpoints of the specific individuals serving on the BC, it provides no outlook on the budget that is any different from what the SB already provided. It has no concerns to weigh that are different from or additional to the SB's concerns. It is pure redundancy.

[MattPublicover]

Question 3:

- Is efficiency the goal in getting through the budget process? Or are voters looking for a deliberate thorough vetting of the budget?

Efficiency is unimportant to me, as long as some benefit is provided by the administrators and department heads having to repeat their presentations twice (to the SB and the BC). Frankly, I think the SB is more attuned to the nuances and details of the budget than the BC is, even with the BC's liaison committees and more lengthy presentations of each segment of the budget. The SB works with the school system all year long, while the BC only looks at the budget on a part-time basis.

If the BC did not exist, the SB would not have to hand off the budget by early January, and would have another full month to dive deeper into the budget, allowing each administrator or department head time to give a more detailed presentation for the benefit of educating the public. If people think the BC understands the budget better than the SB, wouldn't we want the SB to have more time to understand the budget, since they are the one who has to implement it?

[RBarnes]

One thing everyone should consider is not just how the Merrimack bud com works but how bud coms in other towns work. Ours is VERY dysfunctional compared to some of the other town's committees I've seen. The amount of information Merrimack's committee gets (or asks for) is next to nothing compared to other towns.

I agree with a point Matt made here, that perhaps a smaller committee would be a more functional one, assuming that people are elected who are at least willing to put in the time. But if a smaller committee also resulted in more contested elections it may also give voters a chance to find and elect those who are most dedicated.

One additional issues is that many voters also don't know a lot of the people running in the smaller elections. We don't give voters things like candidate nights for bud com candidates, planning and building candidates etc. This results in people voting for names the recognize but they may not necessarily "know" anything about those names.

[ggkrupp]

Matt & Tim,

You make some good points but one thing I should clarify is that you both latched on to my analogy of two Houses of congress having overlapping responsibilities which I meant to be a loose analogy at best. My point was merely that there are examples throughout our Government at all levels which have overlapping responsibilities by design. It is debatable whether this is a good thing in some cases but it is certainly common. Maybe the House and the Senate was a bad choice to cite on my part. Maybe organizations that have appointed members are a better example. The FCC, for instance, has no "skin in the game," as Tim puts it, yet they still make rules that affect voters and directly impact laws enacted by Congress (e.g. selling off bandwidth to corporations ... something I've always thought was a little like selling air ... regulate, sure, but sell?? How did they get to do that? but I digress). Judges are also appointees in most cases that rarely have to live with the consequences of their official decisions. Whether I've given the best examples off the top of my head or not, I think my question is still valid. Do the voters in Merrimack desire a bottom-line check & balance at the end of the budget process? It appears like this is what the BC really is ... Maybe it should be included in the next town survey?

I'll admit that I haven't made up my own mind yet on the need for a BC (hence my original question) but I am enjoying the conversation. I think the strongest point I've heard against a BC was the one concerning the need for the administration to start preparing the budget so early in the cycle. Having lived in that very situation while in the Air Force wherein Congress wants to pass a budget around Oct, the President must get inputs from his agencies ahead of that, the Department of Defense must get inputs from the Services before that, the Air Force HQ needs inputs from its Major Commands before that, and so on down the line ... bearing in mind that there are budget battles at each one of these levels ... you can see why we program managers were preparing budgets nearly a year out too ... a lot of "art" to budgeting in that environment rather than hard justifications and numbers. That is the nature of a bureaucracy ...

As for some of the doomsday arguments that the BC could get out of hand by making draconian cuts to a SB-vetted budget, I've found nothing in my research to lead me to believe that this scenario is likely to occur. The committee is large and despite the random population of its members, a quick read of the last 5 or so years of BC minutes indicates that the committee is rarely in consensus on even the smallest of cuts. Even if they were to somehow get together, unified in purpose to slash the budget, the RSA only allows the BC to change the bottom line by no more than 10% ... while painful, just about any organization can survive a 10% cut for one year and my guess is that if a 10% cut happened against the will of the town, the outcry against the out-of-touch budget slashing would provide more than enough political will for the SB, the BC and the voters to do their part to rectify the budget in the following year.

The final thing I would address is the level of participation (or lack thereof) ... possibly the lack of contested races is a direct result of the committees record. Some seem to believe it has no power, some that it refuses to use the power it has, some that it offers its members no real voice in the process and some (as discussed here) think that it is an unnecessary body all together. Those are reasons I've received while asking folks about their perceptions of the BC and they all of one glaring thing in common ... they discourage the public from participating in the process. Tough to say whether we are dealing with the chicken or the egg here but either perception is correct or the track record of the committee is leading to a false perception in some cases and discouraging participation. Whatever the case may be, there are opinions in the town that should be explored beyond the confines of this Forum (which is probably used by fewer residents than the TS ) j/k couldn't resist

Now that the BC only services the school budget, maybe a better organization would be to make it subservient to the SB, a sub-committee. They could do the vetting of the budget for the SB, take direction from the SB and report out to the SB leaving the SB to have the final say. Thoughts??

[TonyRichardson]

It wouldn't really make much difference what happens to the BC in my opinion.

There literally isn't a nickel's worth of difference between the SB and BC, and the BC is proud of this.

They are neither check or balance over the SB

Effectively they simply provide a body for the other one to point fingers at when residents get upset over the School Budget.

[Norman Phillips]

Tim Tenhave posted the following excerpt:
QUOTE:
You are right there is a cost for the BC. The cycle time for a budget is extended. It means the administration has to start 8-10 months ahead of when the budget takes effect and they have to have a crystal ball to anticipate the economy, enrollments, etc. The SB has to start 6-7 months ahead, etc. This lengthing of the process keeps the SB from being agile and adjusting as circumstances change. Just look at the recent SB action to reduce the BC budget by $500K. The whole process could shift to the right without a BC and keep the responsible body in charge of directly selling/defending their budget that in the end they have to live with. END OF QUOTE
Tim, I have several criticisms of this posting. (My reply has been delayed by forum software problems.)
1) The move to cut 500 thousand from the bottom line was not examined by the School BC. It was voted down by the audience at the DS.

2) Your words might give the impression to an unaware reader that it is the mere existence of the School BC that creates the 8-10 month delay between initial consideration of the budget by department heads and the beginning of the budget year on July 1. ( However I doubt that you intended to give that impression, Tim. ) A major part of that long delay arises from the insertion of the Deliberate Session about 4 months before July 1; the School BC only adds one month to the 3 months before the DS. Thus of the total of 8-10 months ahead of the July 1 implementation date, only one month is due to the School BC. (For a demonstration of this, simply consider the timing of the Town Council budget process, with no BC whatsoever!!)

Finally, the BC is a creation of the voters. It is beholden only to the voters, and it serves only the voters. Its function is not primarily to reduce the budget but to consider carefully the logic behind the budget as it is put forth by the School Board. This includes direct discussion, line by line, with the responsible administrators.
It is very unlikely that more than one or two voters have the time and inclination to examine the budget line by line. With the existing BC we are ensured that at least 12 voters do this.
I therefore view the BC as an important link in the chain from department supervisor to voter. I am sure that many voters view it this way, since the voters approved the formation of the School BC by a larger majority than approved the change from Selectmen to the Town Council.

[andysinnh]

Apologies for not replying sooner, as I'd hoped to after my initial response. Overall, I find it very interesting to see so many want to dismiss the budget committee as ineffective and not serving a purpose, primarily because the committee hasn't really made much of an adjustment over the past several years. Just because changes are not made does NOT mean the committee has no value. I believe that, in many ways, this result is due to the careful creation and review of the budget by the administration and school board before the budget committee even gets the budget to analyze and debate. Having spent a lot of time with our school administration and school board members over the past 4 budget cycles, I can say that every single one tries to balance cost with a quality education. And considering headcount cuts have been made for at least the last 4 years, nobody can say that taxpayer dollars are being spent "willy-nilly" without careful consideration of the overall picture.

In terms of how the BC operates, as compared to other towns, we do have a lot of leeway. The state RSA's only stipulate a few items that the BC must adhere to, including the requirement of a public hearing, the creation of open meetings, and the delivery of the budget a certain time prior to the district deliberative session. Beyond that, it's up to each town to decide how it gets run - or better said, how the committee itself decides it wants to run. For those of us who came into the budget committee after it was changed to be school-focused only, we found that a specific method of analyzing the budget was in place, and were told that it was the best way to move forward based on past experience. Many of us had questioned whether that was really true, and this past year when the committee honored me by voting me to be the chair, the first thing I did was to call a meeting in July to ask the simple question - how do we want to exist? We spent 2 meetings discussing every aspect of how we do business, and every member of the committee could offer up a way we could change.

The first vote we took as a committee was whether we wanted to set the overall budget target for the school district, and then have the administration and school board work towards that number (some towns in NH do this). The vote of the committee was a UNANIMOUS vote to NOT set that figure up front. We did vote to offer up an advisory letter to the administration, calling out areas of concern that the committee wanted the administration to pay attention to during the budget process - similar to what the school board does individually across all 5 members. In the end, we decided not to offer the letter, because the type of concerns that we had as a committee were so varied and indirect that the letter would have not been productive. But on a positive note, we did decide to create the liaison subcommittees early and start investigating the budget before the BC received it from adminstration. You'll notice the formal nature of review the BC took during the SB budget reviews, with the tables set up for our members, and over 50 percent of the committee attending each and every review. In the end, we changed a few things, but didn't make a holistic change to the way we reviewed the budget.

Looking ahead to next year, we'll be having an organizational meeting in May after the new members are elected next week, and we'll once again ask how we want to do business next year. It will be up to the committee to decide how to proceed, and the majority of the committee will decide the direction. I know that I took some heat from some members of the forum here for "not taking a stronger leadership role" in driving the committee towards more dramatic changes and tighter spending control. But if you review the minutes, I tried to get the committee to change how we did things - or at least consider it - and each time the vote of the majority decided not to make a change. Is this right or is it wrong? You decide. But if I get elected chair again this year, I'll be asking the same questions and offering the same opportunity to allow the BC to be whatever the membership want it to be.

I think that Norm Phillips, in his reply just before mine, hit the nail on the head - the committee is a set of voters, elected by the larger voting population, to look at the budget to make sure it's prudent to fund the education of our students. Whether these 12 voters are part of a large pool of candidates, or just 1:1 with a candidate per position - they're elected and represent the voters in Merrimack. And in many ways they offer an alternative to the TC form of town government, with a second set of eyes reviewing the budget before it gets to the DS.

And a final comment to Tim in saying that the BC sets the budget and doesn't have to live with the impacts. I couldn't disagree more, because (as Norm said) we're representatives of the VOTERS, not the school board, and we offer our viewpoints of how we'd like to see money spent to educate the Merrimack students for that coming year. Our vote is no different than the broader set of voters in the town election in April, approving (or not approving) the budget. The only diference is that we have an opportunity to adjust the spending amount if we (as representatives to the voters) feel it's not appropriate based on all of the research that we do. We serve a purpose, and every member of that committee carefully balances the spending control with the education quality of the school district. It's not easy, and it really opens your eyes when you're in the middle of these reviews. I for one as a voter would not like to see the BC disappear. And if the BC members want to do things differently, they are free to decide that, each and every year.

andy

[Jeannine Stergios]

Andy

I think the focus of the BC has to change. In your above post you mentioned how your group thought of setting a budget number but then retracted, then considered submitting letter and then retracted that too. Why? What on earth would there be to lose by doing so? The worse that could happen would be for the SB to say no or ignore it. They're fairly reasonable people and I'm sure they would welcome all input. Exactly who is on this committee and what are their goals? If I were the BC Chairman (and yes I would happily take part if I were able) I would form small groups to be responsible for going over a certain part of the budget and see if there are items on autopilot (items that get thrown on the budget year after year and no one even questions what they're for), question sudden increases/decreases in spending, etc. It appears to me that some members have the sole purpose to sit on the BS is to prevent any spending cuts. Some of the reasons for not making cuts by some of the members last year were simply outrageous.

[andysinnh]

Andy

I think the focus of the BC has to change. In your above post you mentioned how your group thought of setting a budget number but then retracted, then considered submitting letter and then retracted that too. Why? What on earth would there be to lose by doing so? The worse that could happen would be for the SB to say no or ignore it. They're fairly reasonable people and I'm sure they would welcome all input. Exactly who is on this committee and what are their goals? If I were the BC Chairman (and yes I would happily take part if I were able) I would form small groups to be responsible for going over a certain part of the budget and see if there are items on autopilot (items that get thrown on the budget year after year and no one even questions what they're for), question sudden increases/decreases in spending, etc. It appears to me that some members have the sole purpose to sit on the BS is to prevent any spending cuts. Some of the reasons for not making cuts by some of the members last year were simply outrageous.

Jeannine- the liaison subcommittees are made up of 3 members who are assigned to look at each department budget, and do as the difficult questions about things that are either "always there", or where spending changes feel inappropriate. We also requested that Matt Shevenell do quarterly updates on the budget to see if there are any spending "red flags" that may impact the budget in future years. To date, virtually any spending question or request we've had for administration has been provided, and should the BC decide they want additional info, I'm sure we'll get it.

But I do want to talk for a minute about what the role of the BC is. You and some others feel that our role should be to "cut spending". In fact, the role is to balance spending along with delivery of a service. The membership is actually made up of a cross-section of voters that seems to match the sentiment of voters over the past few years. One group wants continued spending reductions, while another group believes the SB and administration know what needs to be provided, and the cost is reflected in the budget. And our debates (and the proposal for spending cuts or even additions during the BC deliberations) reflect that difference of viewpoints. If you look closely at the proposed cuts in the BC session this year, some were actually removed from consideration once the background on the spending item was better understood. And some other cuts were actually based off of a policy of what course of studies should be provided, which is not the responsibility of the BC. There were some proposals that were strictly related to spending (such as capital improvements) that showed the diversity of the BC members. Should the make up of the committee be different in an upcoming year, similar proposals might move forward rather than be defeated.

Personally, this is a healthy discussion about the BC, and my viewpoint of the value of the BC would be the same whether or not I was a member or not. I believe it provides a check-and-balance role in our budget process, and feel that the members care a LOT about the school district and overall spending. Viewpoints of what an appropriate spending amount is do vary from member to member, and year to year - and isn't what the committee is supposed to be all about?

andy