How to Align Budget Dollars with Strategic Plans to Achieve Long-Term Community Goals

Strategic planning is an invaluable part of any organization achieving its long-term goals, public sector or otherwise.

And when it comes to the importance of great planning, nobody summed it up better than Yogi Berra: “If you don’t know where you are going, you’ll end up someplace else.”

Okay, maybe Yogi didn’t quite say it best. But the quippy baseball hall of famer had an important point — especially for public agencies. 

Oftentimes, local governments and school districts have long-term aspirations for their communities — a place they want to go. But they need a strategic plan to formalize precisely where they’re going and how they’ll get there. Without a plan in place, they often end up “someplace else” — a place of unmet goals and status quo operations.  

Forward-thinking budgeting plays a major role in enabling strategic plan creation and implementation. But local governments and school districts employing a traditional budgeting model often scope their budgeting too narrowly, concentrating more on maintenance than future-focused strategic planning. Budgets that aren’t aligned with strategic plans produce missed opportunities to properly plan strategically for the community’s future.

That’s why a modern Budget Cycle Management (BCM) approach is needed when building strategic plans. BCM is a strategic framework that transforms budgeting into a holistic, streamlined set of planning and budget management practices that any public agency can implement. Planning & Tracking is the first of four interconnected stages of the BCM model — followed by Budgeting, Reporting, and Engagement.

Read on to learn why traditional budgeting constrains strategic planning, and how modern BCM facilitates it.

The Dilemma: Incremental Budgeting Hinders Strategic Planning

Traditional budgeting often looks to the past and immediate future to determine its allocations. It’s typically more aligned with precedent and day-to-day responsibilities than long-term plans. 

As the Government Finance Officers Association (GFOA) and the International City/County Management Association (ICMA) note in their report, “Why Do We Need to Rethink Budgeting?,” traditional budgeting is practically synonymous with incremental budgeting — building an annual budget using the previous year’s version, while only making marginal changes to the new budget. 

These marginal changes often affect spending allocations towards routine operations-related line items. And public agencies often base these new allocations on precedent, too.

It is useful to refer to your previous budget for a baseline understanding of totals to help you compare it with the new year’s allocations. But using last year’s budget as the majority of your new budget is problematic for a few reasons. Incremental budgeting can naturally retain past decision-making and bake it into current and future budgets without regard for feasibility. This can produce wasteful spending, inefficient programs, and unrealistic expenditure projections.

On a higher level, basing allocations solely on current needs doesn’t allow public agencies to spend money towards their communities’ long-term goals, capital needs, or emerging challenges. So, they end up “someplace else” by not being more proactive with a budgeting strategy.

By keeping one foot firmly planted in the past and eyes on the present, governments and school districts can’t align budget dollars in forward-thinking ways. This hurts their present budgeting and their future plans.

The Best Practice: Building an Active Strategic Plan that Informs Your Budgeting

In contrast to traditional budgeting, strategic planning and tracking are a living part of the budgeting process in the modern BCM model. Planning and tracking are intrinsically linked to the budget cycle — strategic planning informs budgeting, while budgeting influences strategic planning. 

This means that practicing BCM effectively entails building an active, ongoing strategic plan for your community. This is an exciting, invigorating process that allows you to improve your community. Feel free to get out your party hats.

Strategic plans built using BCM principles utilize the following:

• A diversity of input from community stakeholders, local organizations and businesses, other government agencies, and internal staff. 

• A wide range of internal records and external resources, such as census data, economic reports, citizen surveys, and even partnerships with universities or think tanks.

• SMART goals — Specific, Measurable, Achievable, Relevant, and Time-bound — that are also realistic with current resources and aligned with the community’s long-term vision.

• Actionable strategies with steps, timelines, milestones, and key performance indicators (KPIs).

• Centralized planning documentation, data monitoring, and performance reviews to track progress, with specific initiative owners actively contributing to the strategic plan.

• Shared ownership of keeping the community up to date on progress.  

In BCM, your strategic plan directly informs your budgeting. Instead of allocating funds solely to day-to-day operations-related line items, budgets aligned with strategic plans can build your community’s future while taking care of present needs. 

Align your budget dollars with your community’s strategic plan by doing the following:

• Estimating costs for major initiatives.

• Linking your budget plan to specific accounts’ spending to better determine impacts.
  
• Allocating budgets and resources to ensure that your plan is funded through the coming years.

• Tracking your budget spend along with your data to inform subsequent years’ allocations.

• Communicating to the public your budget’s effects on fulfilling community priorities. 

In Practice: How the City of Flowery Branch, GA, Aligns its Strategic Plans with Budgeting and Engagement

Flowery Branch, GA is a great example of a community for whom strategic planning had been a longtime focus. Flowery Branch’s strategic plans have long helped the city meet its long-term vision and goals. 

But Flowery Branch needed a better way to collaborate with multiple departments to produce a cohesive plan. They also needed an easier way to communicate goals and progress with council members and the community.

Flowery Branch brought its strategic planning practices in line with BCM principles and made them more collaborative, efficient, and transparent. Using ClearGov Strategic Planning, Flowery Branch consolidated all of its strategic initiatives into one document. This single source of planning truth vastly simplifies data input and updates. Flowery Branch also uses its strategic plan to inform its budgeting processes, which has helped keep departmental budget developers focused on city-wide goals.

To improve engagement, Flowery Branch also made its comprehensive planning document transparent to the public. Giving the public a detailed look into the city’s future priorities helps community members understand the city’s focuses and how they benefit the community. 

Flowery Branch now has its five strategic priorities of public safety, infrastructure improvements, internal operations, financial stability, and economic development mapped out within an accessible online planning document and dashboard. Within each priority, the city includes individual goals, action items, key performance indicators, and status updates.

The city’s planning dashboard streamlines the creation of necessary documentation for transparency purposes. And its transparency has also reduced the volume of questions and complaints the city receives. View Flowery Branch’s strategic plan.

“We feel very strongly about strategic planning—it’s a vital part of the operating budget and functioning of a city.” 

– Krystie Hightower, Budget & Purchasing Manager, Flowery Branch, GA

Planning & Tracking with ClearGov Strategic Planning and Capital Project Tracking

As Flowery Branch and over 1,300 communities have seen, ClearGov Strategic Planning and Capital Project Tracking help communities set a forward-thinking standard for planning financial health and budgeting accordingly. These tools also enable you to make your plans transparent so that stakeholders can get a full view of your strategic plans and track their progress.

ClearGov Strategic Planning helps you drive collaborative progress, real-time insights and budget impact for your strategic plans. And ClearGov Capital Project Tracking lets local governments centralize capital project progress, track spending and report the results to the public with ease.

To quote the wise sage Yogi Berra once again, “The future ain’t what it used to be.” With BCM and proper tools in place, your community’s future doesn’t have to be what it used to be, either. Instead, it can be an improved, forward-thinking future defined by funding and accomplishing actionable goals within your strategic plan and budget.
Our public finance experts are here to help you apply BCM principles to your strategic planning. Reach out to us for a demo to see how BCM can work for your organization.