Connecting state and local government leaders
Several localities are marrying up their strategic planning and budget process to be more nimble and better measure performance.
Denton, Texas, is growing—fast. Between 2021 and 2023, the city added nearly 13,000 residents, according to the U.S. Census Bureau. The county that Denton sits in is also rapidly growing; it ranked fourth in the nation in 2022 for total population gains.
To keep up with the speed of growth, Denton needs budget dollars and a strategy to meet the infrastructure and service needs of a growing city. But the traditional budgeting process makes that difficult.
Local governments like Denton have long relied on incremental, line item budgeting where last year’s budget becomes next year’s budget with a few changes on the margins. The approach makes it hard for cities to quickly adapt to changing conditions. So Aimee Kaslik, Denton’s chief strategy officer, has started to marry the city’s budgeting process with its long-term strategic plan and overarching goals.
The city is just one example among several local governments that are looking to have a more transparent budget process that combines short-term budgetary thinking with long-term strategic planning. The overhaul comes amid a push by three government associations for cities and counties across the country to rethink the budgeting process.
Launched last year, the Rethinking Budgeting initiative “considers new ways of thinking, new technologies and updated practices to better meet the changing needs of communities.”
The initiative also calls on local governments to engage the public in the budgeting process to better incorporate resident sentiment, which then can be used to better inform strategic planning and budgeting.
The goals set out in strategic plans and budget documents can be tracked through performance metrics via public dashboards and other ways that show progress towards those goals in a transparent way, said Stefan Baerg, head of enterprise and mid-market sales for Euna Solutions and co-author of a recent white paper on the rethinking budgeting initiative.
“A lot of cities and counties over the years have said this transparency thing is a great thing,” he said. “But it's happening in a silo independent of the planning process, or independent of the budget, and it's just a complete disconnect. You're not able to go to that extent of budgeting for outcomes, when you don't start with what are the outcomes we want to get to in the first place.”
For Denton, the city council last year set six key focus areas that include pursuing organizational excellence, fostering economic opportunity, and promoting healthy and sustainable communities. They are ambitious goals, and go hand-in-hand with the city’s 2040 comprehensive plan that looks to shape Denton’s long-term future.
Cognizant that those goals could be a tough ask for the city’s 27 agencies and departments, Kaslik believes bringing the two processes together will foster a more coherent and focused strategy. She is focused on working with them on how to measure their progress against the city’s goals and how to use the data collected in budget requests.
“The thing for me is always making sure that [agencies] understand I'm not doing the work for me,” Kaslik said. “It's not my data, it's their data. I always want to make sure that they know what's in it for them as a department, as a director, as a manager, as a supervisor.”
Being one of the first cities in the nation to truly embrace this new way of budgeting and planning has meant that Kaslik, agency heads and department managers have had to chart their own path forward.
Kaslik has hosted several workshops, the first of which focuses on which aspects of the strategic plan agencies work to support, the goals they want to achieve and the services they offer to help do so. A follow-up workshop helps determine how that performance is measured, including on whether they are spending tax dollars in the best way.
Determining those performance metrics can be tricky, Kaslik said, as it can be hard to explain to agency heads that “not everything needs a target.” Instead, she said, departments should determine which metrics are the most “meaningful” to track.
“If you stop measuring, who would notice, what impact would that have on you?” she asked. “And is it even something you're ever asked for? In that way, I've been able to weed out some of those metrics that really don't add value. We want to focus on what adds value in the decision-making and department operations oversight.”
Kaslik admitted to some departments being “a little bit more apprehensive” at the start of this new planning process, something that is overcome with education and helping leaders understand why the work is important.
Baerg adds that buy-in from executive leadership like the mayor or city manager can also help alleviate those nerves, as well as overcome the so-called “Weebies” in government, who say, “We’ve been here before you, we’ll be here after you.”
Liz Steward, vice president of marketing and research at Envisio who also co-authored the white paper with Baerg, said the more adopters there are to a new system will increase “psychological safety” and the likelihood that it will catch on more widely.
Kaslik adds that city leaders should learn from those already using data and performance metrics to measure their progress towards their goals.
“Look to your peers who are having a lot of successes and learn from them,” she said. “We're the government, we share willingly, we share freely because I want to share what we do. I want other people to experience the benefits that we get from having that data, having that transparency, having those plans in place, and really putting them into action.”