FGFOA Conference

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FGFOA Conference
Budgeting for Outcomes to Managing for Results

• June 1, 2009

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• Planning for Results
• Community determines the Priorities they
  desire from government
• Held Focus Groups
• Citizens identified 7 Results it expects
  from Government
• A Result Team was formed for each of the 7 Result
  Areas
• Involves Citizens at all steps along the way

• Managing for Results
• POLK PERFORMS
• Accountable for Program Success
• Orchestrate strategies for improvement
• Measure improvements throughout year
• Check back with our customer

Budgeting for Outcomes To Managing For Results

• Program Results
• Reported
• Projected vs. actual
• Benchmarking
• Verification of measures
• Outcome/Guidance Teams/Community
• Did we get what we bought?

• Budgeting for Results
• Set the price of government
• Program Budget offers are submitted/aligned to
  a priority
• Program offers are ranked within each Result
  area according to the best performance measures
  promised results/outcomes.
• Programs are purchased using ranking tool
  until money is gone
• Budget to buy the best Results for the
  priorities

Deliver Services Measure Results
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Benefits of Budgeting For Outcomes(BFO)

• Focus on results/outcomes, not inputs
• Involves citizens in the budget process
• Fosters competition
• Combines Zero Based and Performance-Based
  Budgeting approaches

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Budgeting For Outcomes (BFO)

• BFO combines the best of several budgeting
  methods
• Its focus is on programs rather than departments,
  but more specifically, it takes no existing
  programs as givens. In other words, no program
  gets a free pass.
• Instead it asks all programs to compete with
  other public (and sometimes private)
  organizations to deliver results at the best
  price!
• At its heart are results most important to
  citizens (who have input in the process)
• By re-examining priorities every budget cycle and
  encouraging all kinds of organizations to compete
  to deliver programs it produces valuable
  results!

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Why is BFO Different?
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How Does BFO Work?
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BUILDING BLOCKS FOR BOARD DECISIONS 2009
BoCC Approves Budget / Programs
Sep. 3rd Sep. 10th Budget Public Hearings
Guidance Team reviews purchases made by County
Manager
July 16
County Manager presents FY09 Budget and Board
Reviews Program Ranking and Purchases made by
County Manager
July 10
Guidance Team reviews Board Rankings
June 16
County Manager Purchases Programs
June 8 June 19
Board Workshop to Compare Board Results Team
Rankings
June 4
Guidance Team reviews Result Team Rankings
May 27
May 12 May 29
Board Ranks Programs
Board Workshop to Review Results Teams Rankings
May 11
May 8
County Manager Steering Committee Reviews
Ranked Programs w/ Results Teams
May 7
Results Teams Complete Rankings
Apr. 10 May 6
April 9
Guidance Team reviews program Strategies
developed by Results Teams
Mar. 20 Apr. 10
Mar. 20
Feb. 27 Mar. 20
Feb 27
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Step 1

• Set the Price of Government available revenues.
• The price of Government is the amount of revenue
  available to the county. The Price of Government
  in Polk County has been established through
  property tax reform and the slowdown in the
  economy.

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Step 2

• The Community determined the major priorities for
  government Told us their expectations through
• Five Community Focus groups comprised of 812
  citizens
• These Focus Groups Identified 7 Results expected
  from Polk County Government.
• At these focus groups, the citizens identified
  the results they expected from Government.
  They were then asked to assist in identifying 3 -
  4 indicators of success (performance measures)
  which the county could report back to the
  citizens to see if the county is moving in the
  right direction, towards achieving their desired
  results
• Our Citizen Survey and data from Polk Vision were
  also used to validate these Priority Results

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Step 2 ContinuedPriority Results

• BASIC NEEDS All Polk County Residents who are
  at risk because of health or economic status will
  get basic needs met, and become as
  self-sufficient as possible.
• ECONOMIC DEVELOPMENT Good-paying jobs and
  business opportunities are available here in Polk
  County, and our people are appropriately trained
  and educated to take advantage of them.
• GOOD GOVERNMENT Citizens trust that Government
  is well run and is a good steward of their tax
  dollars.
• GROWTH AND INFRASTRUCTURE Polk County grows in
  a manner and pace that county residents find
  livable, and allows them to move around the
  county safely and without excessive congestion.
• NATURAL RESOURCES AND ENVIRONMENT Polk County
  has clean and plentiful natural resources for a
  healthy environment.
• RECREATION AND CULTURAL ARTS Polk County offers
  safe, plentiful and diverse recreation and
  cultural arts opportunities
• SAFETY People feel safe from crime, fire, and
  the effects of emergencies and natural disasters

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Step 2 Continued

• Once the desired outcomes were determined, a
  Result Team was established for each Priority
  Result Area.
• Each Results Team consists of
• 3 Citizens
• 3 County staff members (knowledgeable about the
  programs being evaluated)
• 3 County staff members (NOT subject matter
  experts)
• 1 Budget office staff member

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Step 3

• Each team designated a team leader and
  facilitator.
• The Team Leader is responsible for the clarity
  and communication of its products, and for seeing
  that the team accomplishes its objectives and
  deliverables on time.
• The Team Facilitator is responsible for managing
  the process, setting meetings, and helping the
  team stay on track.

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Step 3 Continued

• Each Results Team reviewed the priority results
  statement and fine tuned the indicators of
  success
• Each Results Team then used the priority results
  statement and indicators of success to identify
  the primary and secondary factors that most
  contribute to achieving the priority results
  statement
• Using these factors, each results team identified
  a causal map (cause and effect factors) and
  strategies for obtaining the desired Outcomes

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Step 3 ContinuedSample Causal Map
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Step 3 ContinuedSample Strategies - Safety

• The causal map was used to develop the Purchasing
  Strategies
• WE ARE REQUESTING OFFERS THAT
• 1. Respond to emergency situations and unsafe
  incidents as quickly as possible to save lives
  and property
• 2. Respond to unlawful conduct as efficiently as
  possible to protect the community, punish the
  offender, compensate the victims and save tax
  dollars, in accordance with federal, state and
  local laws and regulations
• 3. Prevent the incidence of crime, loss of life,
  fire damage and improve citizen perception of
  safety
• 4. Prepare citizens to withstand the impacts of
  man-made and natural disasters

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Step 3 Continued

• The Results Teams then used the causal maps and
  purchasing strategies to develop the Request for
  Offers (RFO, which is like an RFP).

These first three steps were completed during
the past two BFO processes.
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Step 4

• Divisions/Programs review and study the RFOs and
  submit/respond to the Results Area that most fit
  their program

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Step 5

• After Departments/Divisions submit their Program
  Budgets towards the Priority Result Area of their
  choice, the Result Team members will review each
  offer and will rank the program offers based upon
  their contribution to meeting the objectives and
  purchasing strategies
• This ranking will be forced. Each results team
  will rank a third of the offers as high, a third
  as medium, and a third as low.

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Step 6

• The Board will meet with Results Teams in a
  workshop to discuss the rankings
• The Board will review and submit their own forced
  rankings

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STEP 6 ContinuedSafety Rankings (Example from
FY07/08)
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Step 7

• The County Manager and Board purchase programs
  that contribute
• most to desired outcomes

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Step 8 - GUIDANCE TEAM

• Polk- One for Each District
• They Watch the process transparency
• Dont Make Decisions
• Dont Make Recommendations
• May Not Agree with Ranking
• Do oversee the INTEGRITY of the process is
  followed was the process followed
• Do they think the process had value

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Integrity

• Throughout this ENTIRE process, a Guidance team
  comprised entirely of citizens (5-appointed by
  the BoCC) assures the integrity and credibility
  of the process
• This Guidance Team meets at each critical step in
  the process as follows
• Reviews Results Teams Strategies and Requests for
  Offers (RFO)
• Reviews Results Teams Rankings
• Reviews the Board/Results Teams Rankings
• Reviews the County Manager recommended purchases
• They make sure teams followed the guidelines and
  kept a close watch on the overall proceedings

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Steps in Budgeting for OutcomesSummary

• Set the Price of Government Identify available
  revenues
• Establish Priority Results through community
  input, and a Results Team for each result area
• Results Teams a) set indicators, b) identify
  primary and secondary factors, create Causal
  Maps, and d) form Request for Offers (RFOs) in
  order to purchase what works and matters most

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Steps in Budgeting for OutcomesSummary

• Divisions/Programs review and study the RFOs and
  submit to the Results Area that most fit their
  program
• Results Teams rank offers by contribution to
  outcomes
• Board Members rank offers by contribution to
  outcomes
• Manager and Board buy Programs that deliver
  results citizens want at the price they are
  willing to pay
• Guidance Team assures the integrity and
  credibility of the process.

Remember, this process focuses on
programs/services that deliver most to the
desired outcome, not on those that will not be
purchased.
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• Planning for Results
• Community determines the Priorities they
  desire from government
• Held Focus Groups
• Citizens identified 7 Results it expects
  from Government
• A Result Team was formed for each of the 7 Result
  Areas
• Involves Citizens at all steps along the way

• Managing for Results
• POLK PERFORMS
• Accountable for Program Success
• Orchestrate strategies for improvement
• Measure improvements throughout year
• Check back with our customer

Budgeting for Outcomes To Managing For Results

• Program Results
• Reported
• Projected vs. actual
• Benchmarking
• Verification of measures
• Outcome/Guidance Teams/Community
• Did we get what we bought?

• Budgeting for Results
• Set the price of government
• Program Budget offers are submitted/aligned to
  a priority
• Program offers are ranked within each Result
  area according to the best performance measures
  promised results/outcomes.
• Programs are purchased using ranking tool
  until money is gone
• Budget to buy the best Results for the
  priorities

Deliver Services Measure Results
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Scorecard at a Glance
Polk Performs
Basic Needs
Economic Development
Good Government
Priority People in Polk County who are at risk
because of their health or economic status will
get their basic needs met, and are as
self-sufficient as possible.
Priority Good paying jobs and business
opportunities are available in Polk County, and
our people are appropriately trained and educated
to take advantage of them.
Priority Citizens trust that Government is well
run and is a good steward of their tax dollars.
Indicators
Indicators
Indicators
EXAMPLE
Improving
Improving
Improving
Worsening
Maintaining
Improving
Improving
Improving
Improving
Improving
Growth
Natural Resources Recreation
Safety
Priority Polk County grows in a manner and pace
that county residents find livable and allows
them to move around safely within the county
without excessive congestion.
Priority People feel safe from crime, fire, and
the effects of natural disasters.
Priority Polk County has clean and plentiful
natural resources for recreation and
environmental health.
Indicators
Indicators
Indicators
Worsening
Maintaining
Improving
Improving
Maintaining
Maintaining
Improving
Improving
Improving
Improving
Not Real Ratings Example Only
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Scorecard at a Glance
Polk Performs
Economic Development
Worsening
Indicator Annual Net Job Growth
Yearly Measure The number of net jobs created
annually by the county is an indicator of a
growing and prospering economy. In general, when
economists and economic development specialists
refer to the job growth or net increase in
employment level they tend to use measure of
non-farm business sector of the economy. The
non-farm business sector is a subset of the
domestic economy and excludes the economic
activities of general government, private
households, nonprofit organizations serving
individuals, and farms. The non-farm business
sector accounts for more than three-fourth of the
value of gross domestic product (GDP) of the
entire nation. Annual job growth or the number of
net. new jobs created annually for any given year
may be calculated by taking a difference between
the current year and prior year total employment
levels. Net Job Growth (t) Total Employment
(t) Total Employment (t-1) Polk County total
non-farm employment level and annual net job
growth since 1990 are presented in Figures 1 2.
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Scorecard at a Glance
Polk Performs
Economic Development
Improving
Indicator Average Wage Paid by All Polk County
Employers
Yearly Measure The Florida Agency for Workforce
Innovation publishes annual estimates for the
average (mean) hourly wages for major metro area
in the state for more than 700 different
occupational categories along with average for
all occupations together. To arrive at the
average annual wage one can multiply the average
hourly wage for all occupations with the total
number of hours a fully employed person works
during the full year. Average Annual Wage
2,080 x Average Hourly Wage for All Occupations
An average worker's wage is the mean salary of a
group of workers. The measure is generally
monitored and used by government (federal, state
and local) or other private and public
organizations as a benchmark for the average wage
of workers in an industry, local area or the
entire nation. Generally from local economic
development and workers point of view rising
wages are a welcome sign and represent growing
economy and better living standards due to higher
purchasing power assuming inflation does
seriously erode those gains. From purely economic
development perspective rise in average wages of
a local economy due to the types of jobs which
earn significantly higher pay are highly sought
after because that improves the social and
economic fabric of the local economy. Higher
paying jobs translates into higher spending on
education, health, local consumption of goods and
services and thus driving the engine of local
economy into a higher gear. A comparison of Polk
County and Floridas average annual wages for the
past four years is presented in the Figure 4.