Monday, December 27, 2010

Getting to the Bottom Line

A lot has been said and continues to be said about the adoption of a State Budget by July 1.  This is a good idea.  It means that when the State's new fiscal year begins on October 1, departments and legislators know exactly what the numbers are.  It virtually eliminates the chance for a government shut down.  Would that the same scenario could be said in Townships.

For fifteen of the twenty-one budgets I was involved with at West Bloomfield Township, the budget was required to be done sixty days prior to the start of the fiscal year.  In 2003, the law was changed to require a budget be prepared and adopted by December 31.

For West Bloomfield, which starts its fiscal year on January 1, this cuts the adoption really close.  For the majority of townships in Michigan, the fiscal year begins on April 1 (such is the case with Bloomfield Township).  Adopting a budget by December 1 means that they have to adopt a budget earlier than before. 

I have tried to make sense of how and why this passed, but have never been able to do so.  Some of the sponsoring legislators had townships with January 1 dates and others with April 1.  It meant that all would have a longer time to prepare their budgets, but that those communities with January 1 years would be cutting it pretty close.  And since tax rates are set in October, communities already have pretty solid tax revenue numbers to work with.  The State budget has been set so that revenue sharing numbers, while estimated, are still pretty solid. 

The law requires that Township Department Heads submit their budget requests 150 days prior to the start of the fiscal year and that the Supervisor submit a budget to the Township Board no later than 120 days prior to the fiscal year.  That gave Township Boards prior to the law change at least two months to approve budgets and adopt them. 

No matter the change in the law, there is nothing stopping Townships from adopting their budgets in a timely manner, well in advance of the start of the fiscal year.  Let's hope that our Legislators in Lansing do the same.

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