Councilman Green introduces legislation to require disclosure of fiscal data

PHILADELPHIA, PA – City Councilman-At-Large Bill Green today introduced a package of legislation that would increase the useful, relevant information available to legislators and citizens both during the annual budget hearing process and generally when considering pending legislation in City Council.

“Budgeting, and governing, is choosing between competing ideas for good.  Particularly given the challenging fiscal environment the City continues to face, it is essential we have the information needed to make the best choices for citizens,” said Councilman Green.  “Without knowing the specific costs and benefits of the functions performed with City funding, or the costs related to new legislation, our ability to meet this basic duty to our constituents is significantly compromised.”

The package consists of bills requiring:  (1) the submission of program-based budgeting information for all functions supported by City funding detailing the true cost of performing the function and how the City measures the function’s effectiveness; (2) the submission of cost-benefit analysis for all proposed capital projects; and (3) the availability of fiscal impact analysis, upon request, for any bill introduced in City Council.

Governments across the United States – including cities, states, and the federal government – utilize the type of program-based budgeting, cost-benefit analysis, and fiscal impact analysis the legislation provides for. 

“Until we know the cost and effectiveness of what we do, we’ll remain stuck in budgetary default mode:  making incremental changes to department budgets year over year – more often than not, upwards adjustments – without sufficiently understanding the value received for the spending,” Councilman Green noted. 

 

Program-Based Budgeting

The program-based budgeting bill requires data about the component costs of performing each function supported with City funding, including:

  • Direct salary costs, including the number of employees performing the function, as well as fringe benefits costs;
  • space rental and maintenance costs, listed separately for each building or other facility used, as well as materials, supplies, and equipment costs, fleet costs, and energy costs; and
  • any revenue generated by performing the function.       

The required program-based budgeting procedure also includes developing specific performance goals for each function funded with appropriations in the City budget and annual reporting on how well the goals are being met.

 

Cost-Benefit Analysis

The legislation regarding cost-benefit analysis for capital projects requires the City to provide information for each proposed capital project including:

  • The life-cycle cost of the project, including all initial project costs, periodic or continuing costs of operation and maintenance, and any anticipated costs of future decommissioning or disposal of the capital asset;
  • the benefits of the project, including any performance benefits (e.g., improved working conditions for City employees or increased utilization of facility by City residents) and quantitative benefits (i.e., lower utility expenses as a result of upgrading an HVAC system); and
  • analysis of any alternatives to the proposed investment, projected return on the investment (i.e., manner in which benefits of project exceed its cost), and anticipated payback schedule.

 

Fiscal Impact Statement

The third bill in the package provides for the preparation of fiscal impact statements, upon request, regarding pending legislation and requires the Finance Director or Controller, as requested, to prepare such statements.  The fiscal impact analysis would determine whether the proposed legislation would have an impact, positive or negative, on the City’s costs and revenues.

 

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"I ran for office four years ago and I am running today because I love this City... My campaign theme in 2007 and still today - 'beholden to none, accountable to all' - reflects my commitment to be a strong, independent voice for all Philadelphians." - Bill Green