Budget Guide and Best Practices for Government Agencies

May 8, 2012 — 1,060 views  
Become a Bronze Member for monthly eNewsletter, articles, and white papers.

When their budgets are different from what their constituents think they should be, state and local government representatives often get a lot of flack. Many taxpayers are very aware of how the government spends their money. The problem is that most taxpayers -- like most representatives -- have very different ideas of what effectively spent money looks like. However, there are some best practices that state and local governments can consider when developing a budget. The best practices will help these government agencies create a budget that satisfies more citizens.

1. Consider Public Opinion

Often, taxpayers are right when they say that government officials do not think about their needs and opinions when drafting the budget. This can be plainly seen in the controversy surrounding the President Obama's healthcare reform act. Individuals were concerned that the act allowed federal funding for abortions and staged a number of protests over that fact.

For this reason, state and local governments should consult with political analysts when completing their budgets to determine what public opinion on their line items may be. Of course, they may need to still appropriate money to the unpopular item, but they will at least have a better idea of how to explain that item to the public.

2. Hire Professionals

Professional consultants go a long way to legitimizing a government's budget. In addition to elected officials, state and local governments should hire independent, private consultants to offer their feedback on the budget before it is signed into law. Some areas in which professional consultants can be used are the following:

- To review the procedures for creating the budget, to ensure policies were unbiased and were adhered to

- To review calculations, accounting

- To determine the public opinion on certain budget items

- To estimate the cost of various tasks

3. Utilize Transparency

Where money is concerned, individuals are often skeptical of those who wish to maximize their own profit at the expense of others. For this reason, state and local governments should keep their accounting and procedure policies as transparent as possible. They should allow individuals to look at records from budget meetings and other related documentation.

Preparing a budget is often one of the hardest things for a state or local government to do. However, keeping these best practices in mind will help budget preparers at both levels.