Historical March 1987 report or notice. Original dates, prices and contacts describe the source period; current availability has not been established.
On April 7 1987, voters of the City of St. Louis will consider an amendment to the City’s Charter which, if approved, would greatly impact the operation of city government.
The amendment mandates a timeframe in which the City’s operating budget must be approved.
The Charter amendment requires that the City’s operating budget be approved by May 1, the beginning of the fiscal year Under the amendment, the City’s Board of Estimate and Apportionment, consisting of the Comptroller, President of the Board of Aldermen and myself, must submit the City’s operating budget to the Board of Aldermen at least 60 days before the beginning of the fiscal year.
The Board of Aldermen must approve the budget before May 1, the beginning of the fiscal year.
In the event the Board of Aldermen has not approved the budget by the May 1 deadline, the budget is automatically approved.
In either case, the City will begin the fiscal year with an adopted operating budget. Of the major cities in the nation, St. Louis is one of two cities that has not instituted a formal timetable or structure pertaining to the budgetary process.
Since such a timetable is not utilized, the budgetary process often extends into the current fiscal year.
As a result of the delays by the Ways and Means Committee, the current year’s budget was not approved until 6 months into the fiscal year. Delaying the budgetary process is not only fiscally irresponsible but has greatly impacted the delivery of city services.
If the budget is not approved by the beginning of the fiscal year, legislation is required so that departments can continue to operate.
However, departments must maintain expenditures at the level of the previous fiscal year. Due to the uncertainty of available funding, contracts cannot be executed and new projects must be postponed.
This results in increased costs and lost opportunities. Additional administrative expenses are also incurred by delays in the budgetary process.
The constant revision of the budget document requires that administrators focus attention on the current year’s budget rather than planning and forecasting for the coming year.
Instead of a guide to anticipated revenues and expenditures, the budgetary process has become strictly an accounting exercise. Of greater impact, the City’s bond rating is also affected by the lack of a formalized budgetary timetable.
The City’s bond rating is Baa or the lowest investment grade rating.
This means that the City has to pay higher interest costs and higher bond insurance rates to borrow money.
Since rating agencies consider the budget an expression of administrative capability, it is essential that the City institute sound, financial planning measures. Instituting a specific timeframe would promote efficiency as well as fiscal control in the budgetary process.
In order to adopt the Charter amendment, approval of 60% of the voters is required.
It is imperative to the financial future of our City that the amendment be adopted.
Originally published in The Times of Skinker-DeBaliviere, March 1987.
Read this article in the original newspaper issue.
Original source: SD_Times1987_03.pdf, printed page(s) 7; PDF page(s) 7.
