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Fort Collins, Colorado uses a "budgeting for outcomes" system that officials say prioritizes initiatives that are likely to help the city achieve its overall goals.
Municipal budgeting typically involves government officials appearing before administrators to make a case for programs and initiatives that need funding. Citizens usually see the budget only after officials have compiled a rough draft, and funding levels traditionally follow predictable patterns from year to year as overall costs increase or decrease.
Not so in Fort Collins, Colorado. Since 2005, the city has put together its biennial spending plan via a process known as “budgeting for outcomes,” which emphasizes accountability in government by allocating funding based on measurable results. Priorities are arranged under an umbrella of seven strategic objectives—things like transportation, safe community and economic health—which citizens are encouraged to weigh in on by indicating the types of programs they’d like their tax dollars to pay for.
The result, said City Manager Darin Atteberry, is a wide-ranging process that’s allowed the city to focus on desired outcomes rather than simply directing money to departmental requests.
“Budgeting for outcomes has been transformational and has been an excellent system that helps us become more results-driven versus just funding local government,” he said. “I think it’s had a profound change on our culture. It’s not the only budgeting tool, but it’s the one that works very well for the city of Fort Collins.”
City officials said they adopted the practice after Fort Collins lost a hefty share of sales tax revenue due to big-box stores opening in nearby municipalities, forcing administrators to make difficult budget cuts. Budgeting for outcomes, which has also been used in cities like Baltimore, added transparency to the process, allowing citizens to understand what their tax money was paying for and giving city employees a new way to think about funding requests.
“It was about moving from a ‘trust us’ model of government to a results-based model,” Atteberry said. “The ‘trust us’ model—where you give us your tax money and trust that we’ll use it wisely—didn’t work well when we had to start looking at cutting back city services.”
The city used an outside contractor that first year to set up the process, informing departments of the new structure. It was hard, Atteberry said, and resulted in some turnover. At its core, the system is based on the premise that city departments make proposals for programs that help Fort Collins move toward achieving one of its seven strategic objectives.
“We call them offers,” said Mike Beckstead, the city’s chief financial officer. “It allows us to rank the different things that staff wants to accomplish and prioritize them in a very transparent qualitative and quantitative way that makes sure that you’re spending your dollars on the initiatives that will have the greatest impact on the outcomes you desire.”
Citizens have multiple opportunities to participate in the process. Residents can join a budgeting-for-outcomes team focused on one of the city’s objectives, helping officials sort through department proposals to help “evaluate and rank them and decide what we fund and don’t,” Beckstead said. “They then become ambassadors of the budget, talking to the community about it, as do the 50 to 60 staff members serving on those teams.”
Residents and community groups can also fill out an online survey indicating their feelings on city services and projects. They can build their own budgets via an online tool. And they can attend workshops and presentations, given by city staff in the weeks leading up to the budget's debut. All the information from those outreach efforts is compiled in a summary that’s given to the city council and helps Atteberry draft his budget proposal.
“What’s kind of cool is that the process is such that we’ve had changes as we’ve gone through the budget process,” Atteberry said. “Council has their deliberations and our residents have had the ability to significantly affect items that are important even through the end of the process.”
During the last cycle, one of the most popular requests from residents was an expansion of the city’s transit hours to include Sundays and holidays. It was something that Atteberry hadn’t included in his budget proposal, but the program was added during deliberations after council members saw how important it was to residents.
“I did not recommend that in my budget, but the process was engaging and transparent and nimble enough to allow our council to change it and adopt that version,” he said. “As we look back on that decision over the last two years, it was a fabulous choice. We now have people who are transit-dependent who have access to it 365 days per year.”
The system has yielded other tangible results as well. The city is in the process of building its own broadband network, with the first customer scheduled to come online in August. The project started with an objective to explore how to ensure that Fort Collins was a “connected city,” which led to funding a team to explore whether the city should “get into the broadband business, and if so, in what fashion,” Atteberry said.
The results of that research led the city to compile a $142 million broadband business plan that was eventually approved by the city council. The entire project came to life because of the budget strategy, Atteberry said.
Because of those results, both Atteberry and Beckstead believe that budgeting for outcomes will remain a permanent fixture in Fort Collins even if the city’s leadership gets shaken up in the future.
“In the early years I think the process may have been dependent on its leader,” Atteberry said. “But the way it’s matured and been integrated into the city’s long-term planning, I have no doubt that even if I went away or the mayor went away, budgeting for outcomes is here to stay.”
Kate Elizabeth Queram is a Staff Correspondent for Route Fifty and is based in Washington, D.C.