The budget is one of the most important documents a state or local government prepares since it identifies the services to be provided and how the services are to be financed. Because of the time required to read and understand the entire budget document, a concise summary and guide to the key issues and aspects of the budget is valuable to ensure the education and involvement of the public.
GFOA recommends that budget documentation for a government include a concise summary and guide to the key issues and aspects of the operating and capital components of the budget to ensure the education and involvement of the public. A summary should be publicly available for both the proposed budget and the adopted budget.
The summary can be provided in many formats and can vary in size, scope, and level of detail. It may include one or more of the following: a transmittal letter, a budget message, an executive summary, and a budget-in-brief. At a minimum, a summary should do the following:
- Summarize the major changes in priorities or service levels from the current year and the factors leading to those changes.
- Articulate the priorities and key issues for the new budget period.
- Identify and summarize major financial factors and trends affecting the budget, such as economic factors; long-range outlook; significant changes in revenue collections, tax rates, or other changes; current and future debt obligations; and significant use of or increase in fund balance or retained earnings.
- Provide financial summary data on revenues, other resources, and expenditures for at least a three-year period, including prior year actual, current year budget and/or estimated current year actual and proposed budget.
- Define a balanced budget and describe state and local requirements for balancing the budget. State if the budget is balanced or not. If the budget is not balanced, explain why not.
- Best of Governmental Budgeting, Dennis Strachota, GFOA, 1994.
- Recommended Budget Practices: A Framework for Improved State and Local Government Budgeting, NACSLB, 1998.
- Recommended Budget Practices CD-ROM, NACSLB, 1998.
- Budget Awards Program: Illustrations and Examples of Program Criteria, Juliet Carol Powdar, GFOA, 1999.