Priority Based Budgeting

Overview of Priority Based Budgeting

Glossary - Priority Based Budgeting

What Exactly is Priority Based Budgeting?

• New approach to developing County Executive’s budget proposal
• Modeled after Governor Locke's Priorities of Government Budgeting Process started two years ago

Why do Priority Based Budgeting?

• Forecast budget shortfall
• Business as usual means ‘thinning the soup’
• Need to restore public confidence
• Need to focus - delivery quality services and long term fiscal solvency

Traditional Budget Approach

• Used previous year’s cost as base
• Added in inflation for those costs, plus enhancements ("decision packages")
• Argued about cuts (anything less than newly adjusted costs)
• Justified agency needs & costs in budget submissions - not about producing results

How Does Priority Based Budgeting Work?

1. Set the ‘price of government’  which includes total taxes, fees and charges
2. Determine the key results that citizens expect from county government - their priorities
3. Choose indicators to monitor progress towards those results
4. Identify proven/promising strategies the county should pursue to achieve the results
5. Ask for "offers" to advance each result
6. Allocate expected county resources across the results - the "price" for each priority
7. Prioritize the purchase of activities to best accomplish the results

The Price of Snohomish County Government

7 Draft Priority Results

• Transportation: I want reasonable & predictable travel times
• Safety: I want to feel safe where I live, work, and play
• Education: I want kids in my community to pass the State school achievement tests
• Health & Vulnerability: I want to improve the health of people in the community and reduce the vulnerability of those at risk
• Community: I want to live in a thriving community, one with infrastructure sufficient to support planned growth
• Security: I want my community to be prepared to respond to emergencies
• Effective, Efficient, Trustworthy Government: I want to get the level of service I need at an affordable price and see that my dollars are spent wisely
  • Will be split into 2 teams - County Leadership & Support Services

Indicators of Success

• Three high-level metrics that indicate whether success is being achieved
• Example:  In the state’s Health result, there were three indicators:
  • Epidemiological index of health
  • Citizen self-assessment of health
  • Percentage with health insurance

Map What Works

• Identify the key factors (based on best available data and research) that contribute to the intended result
• Build a "strategy map" showing the pathway to the result
• Example:  To improve health of Washingtonians, one key strategy was to "Increase Healthy Behaviors" by doing things such as reduce tobacco use, promote healthy eating & exercise, and promote safe sexual behavior.  See strategy map.

Strategies to Produce Results

• Create a purchasing strategy to produce your result (i.e., an RFP) within your allocation
• Choose the mix of strategies that you want to invest in to achieve your assigned result
• Example - to improve student achievement, the WA team chose three purchasing strategies:
  • School-ready kids & families
  • Student-ready teachers
  • Learning-ready schools
  • High school connections to college and jobs

Department Offers

• Chose which Results Teams’ RFPs - which results to achieve
• ID specific activities
• Tied to specific results
• At a specific price
• May propose as many as want

Financial Allocation to Each Result

• Helps the County think about all the financial resources (not just General Fund) that can be invested in producing these results
• Challenges the historical notion of a pre-defined department "base"
• Based on judgment of the value citizens would place on achievement of each result

Prioritize Activities to Produce the Results

• Starts the conversation differently - "how can we spend these limited resources incredibly well?" versus "where do we cut?"
• Helps identify alternative approaches to service delivery, potential opportunities for more efficiency, as well as possible duplication of services

Key Roles in PBB Process

• County Executive
• County Council
• Guidance Team
• Results Teams
• Staff Steering Team
• Public Strategies Group

The Guidance Team

• Individuals chosen by County Executive drawn from local government, business, and non-profit communities
• Not intended to be representative of interest groups or subject-matter experts
• Expected to bring an outside, "executive" perspective; wear the "citizen’s hat"
• Role is to review, strengthen, affirm the work of Results Teams
• They also recommend the initial allocations to each team

Results Teams

• Each consists of 6 to 8 subject-matter experts and "good heads" drawn from County and municipal government
• Expected to bring experience and appreciation for implementation issues, but also wear the "citizen’s hat" (versus representing their agencies)
  

What Do Results Teams Do?

• Develop 3 indicators of success for their result
• Develop strategy map that shows the causal factors that make the most difference in achieving the result
• Create a purchasing strategy/RFP for achieving the result
• Invite proposals from agencies on how to achieve the result
• Prioritize the proposals
• Submit purchasing plan to Guidance Team

Timeline

• April 22:  Results Team kick-off
• May 27: Tollgate #1 (Guidance Team reviews strategy maps, purchasing RFPs, and determines allocation of funds)
• Week of July 5: Departments submit responses to RFPs
• Week of July 26: Tollgate #2 (Guidance Team reviews preliminary rankings and buying decisions)
• Week of August 23: Tollgate #3 (Revised proposals, including cross-team efforts)
• Fall: Evaluation of process by Guidance Team