HomeMy WebLinkAboutFinancial Management Manual Section 540540-1
Section 540
OVERVIEW
Formal amendments to the budget (including increases or reductions in both revenues and
expenditures) may be required for a variety of reasons, including:
Supplemental appropriations approved by the Council.
Changes in Memorandums of Agreement.
Acceptance of grant programs.
Revisions to currently funded programs, projects and activities.
Intra-departmental revisions between and within program areas.
A standard Budget Amendment Request form is used to document all budget changes.
Amendments to the budget that do not have significant policy impacts and will not affect
budgeted fund balances or working capital may be administratively approved; all other changes
require Council approval.
POLICIES
Budget Control
Through adoption of the two-year Financial Plan, the Council sets major City goals and program
objectives, approves timeframes and departmental responsibility for accomplishing them,
establishes service levels, and appropriates the resources necessary to achieve objectives and
deliver services.
Under our program budgeting approach, departments are provided with significant flexibility in
managing the resources allocated to them for these purposes: although detail line item budgets
are prepared for each of our operating programs, formal budget control is maintained at the fund
level by department. However, in order to help assure that this overall budgetary control goal is
achieved, more detailed financial reporting and budget control guidelines are internally used at
the program and object level as more fully discussed in Section 560: Monthly Expenditure
Reports of the Financial Management Manual.
Budget Amendment Authority
Council. As provided under City Charter, the Council has the sole responsibility for adopting
the City's budget, and may amend or supplement the budget at any time after its adoption by
majority vote of the Council. After budget adoption, all supplemental appropriations from
fund balance or working capital require Council approval.
City Manager. The City Manager has the authority to make or approve administrative
adjustments to the budget as long as those changes will not have significant policy impacts
nor affect budgeted year-end fund balances or working capital.
BUDGET AMENDMENTS
Budget Amendments
540-2
Director of Finance & Information Technology. The Director of Finance & Information
Technology (IT) has the authority to make or approve administrative adjustments to all line
item accounts at the department and program level, and to adjust offsetting revenue and
expenditure accounts based on policies or programs approved by the Council. However, any
such adjustments must not have significant policy impacts nor affect budgeted year-end fund
balances or working capital.
Department Heads. Department Heads have the authority to make administrative
adjustments within and between their program budgets as long as those changes do not have
significant policy impacts nor affect department totals at the fund level for current and future
fiscal years. Budget adjustments approved by Council may be made by Department Heads
without further approval.
Exceptions. Certain budget amendments require approval from the City Manager:
Moving budgeted funds between capital improvement plan (CIP) projects.
NOTE: Moving funds between phases (e.g. Design to Construction) of the same CIP
project may be approved by the Budget Manager.
Budget changes to staffing accounts, including moving funds between programs.
Budget increases to travel, meetings and dues at the departmental level.
NOTE: Moving funds among travel, meetings and dues line items between programs may
be approved by the Budget Manager.
Budget Amendment Request
To ensure that all changes to the budget are correctly recorded and appropriately authorized, a
standard Budget Amendment Request form is used to document all budget changes, including
those approved by the Council. As such, any Council Agenda or City Manager Report that
amends the budget should be accompanied by a completed Budget Amendment Request when
submitted to the Finance Department as part of the review process. However, as noted below, a
Budget Amendment Request will not be included with the Council Agenda packet.
PREPARING THE BUDGET AMENDMENT REQUEST
Completing the Budget Amendment Request form is largely self-explanatory. A sample is
included at the end of this section. Consider the following in preparing the form:
More than One Department. The signatures of all Department Heads are required if more
than one department is affected.
More than One Fund. Only one fund should be affected per form to ensure that any budget
transfers between funds will not result in changes in ending balance for any of the funds.
Regular Staffing. When proposing to use savings from regular staffing costs to fund other
cost areas, the contra-account of Salary Savings (707) should be used instead of directly
Budget Amendments
540-3
reducing all the other affected line accounts (regular salaries as well as related benefits). This
approach has several benefits: it reduces the number of specific line item accounts that would
otherwise have to be adjusted to correctly reflect the savings; and it retains the budgeted cost
for authorized regular staffing levels for information and financial reporting purposes.
City Manager Approval. Whenever City Manager approval is necessary as discussed
above, the sponsoring department shall forward the approved City Manager Report and
Budget Amendment Request to Finance for processing as soon as possible.
Council Approval. The Council must approve all budget amendments if total amendments
for expenditures do not equal zero, or if total amendments for revenues and expenditures are
not equal.
Reason for the Amendment. In most cases, the space provided on the form under “purpose”
should be sufficient to describe the need for the requested change (supporting documentation
may be attached if appropriate but it is not required). If the amendment implements Council
or prior City Manager approval of a budget change, the date of this action should also be
referenced in this section.
PROCEDURES
Initiating the Amendment. The operating department requesting an amendment is
responsible for completing the Budget Amendment Request. If the request requires a new
program or account number, the Department of Finance & IT should be contacted before
completing the form for the assignment of appropriate account numbers. Department Head
approval of the request is required before its submission to the Department of Finance & IT.
Finance Review. All requests should be submitted to the Budget Manager who will review
the request to determine the affect of the change on fund balances and to verify account
numbers. If required, the request will be forwarded to the Finance Director for approval.
Human Resources Review. All requests that affect staffing accounts require review and
approval by the Human Resources Director.
Council Agenda Reports. Budget Amendment Requests that are related to a Council agenda
report will be pulled by the Department of Finance & IT and held pending Council action. If
the Council approves the item, the request will be processed by the Department of Finance &
IT without further action required by the department. Items disapproved or changed by the
Council will be returned to the originating department for further action as appropriate.
Implementation. After the Budget Amendment Request has been submitted and approved,
the operating department should review the next Monthly Financial Report to ensure that the
change has been processed as requested.
Original policy issued in 1988. Revised by the City Manager January 1996, July 2001, July 2004, October 2014.
Budget Amendments
540-4