The Future of Program Budgeting is Demonstrated in Fort Saskatchewan!

Fort Saskatchewan, Alberta, has been working with ResouceX since 2019. They utilize OnlinePBB for operating budgets and prioritize their Capital projects through the Priority Based Budgeting process. In the years since launching with ResourceX, they have demonstrated thought leadership, project ownership, and continuously push the program budgeting movement forward as leaders in the PBB community.

So, it came as no surprise that their 2022 Operating and Capital Budgets once again demonstrated a forward movement meriting recognition and celebration. But let's take a step back and think about why a movement forward in local government budgeting is so important. 

The budget is the most powerful tool a local government has to impact its community and should be utilized as such to increase innovation and new initiatives. 

The line-item budget turned 100 years old this year… Consider that. It has outlived many great minds, many great technologies, and many great methodologies. Those great minds passed on their ideas which have evolved and grown into new ideas, those technologies contributed to even more extraordinary innovations, and those methodologies are the foundations for new practices that are more efficient and effective. Yet, we’re still budgeting with line items. That is a thinker. 

Now, line items serve a purpose for spending control and appropriation management, but as a tool for resource alignment and decision making, I’m not sure how we haven’t moved on from this aged practice. How has this method not been replaced and made more efficient, effective, scalable, etc?  

GFOA believes that the public finance profession has an opportunity to update local government budgeting practices to take advantage of new ways of thinking and new technologies to better meet the changing needs of communities. And the Super User team in Fort Saskatchewan, led by: Shannon Andruchow, Marley Hanrahan and John Dance, are proof that it can be done. 

The work that the team in Fort Sask put into shifting their organization from a line item-driven budget to a Priority Based Budget deserves celebration and accolades! While this isn’t their first budget where programs have played a role, this 2022 Operating and Capital Budget reports all budget data at the program level, with the supporting line item data available for reference in the Appendix (starting all the way back on page 370). 

This is significant for several reasons:

The City has nearly 200 unique programs that describe the services provided to the community. Each program offers details into what it does for the City, how much it costs to provide it, how many staff contribute to its provision, and how it contributes to the achievement of the strategic priorities of the community.

• • • • • Citizens understand the services the organization provides.
        • Internally, other departments have clarity about what other areas of the organization are working on.
• Decision-makers have a complete understanding of where time is spent and where resources are going, and why.

PBB has provided a greater understanding of strategic priorities developed by Council through the Strategic Plan and other strategic documents, such as the Municipal Development Plan and the Community Sustainability Update.

• • • • Departments made requests based on impact to priorities and alignment to Basic program Attributes so that decision-makers had a complete data set to begin their process.
• Decision-makers can back up their decisions based on data ensuring that resources are going to programs supporting community and organizational needs that confirm city identity and priorities.

3. This budget represents a growing community that desires new initiatives to meet their needs, not a static document of incremental changes. It tells the story of their City. 

For the City of Fort Saskatchewan, PBB serves as a tool and a framework for evaluating programs and capital project options and alternatives to help make decisions about resource allocation. It is based on allocating budget dollars to programs that bring the most significant value to the community to optimize service delivery and maximize value for tax dollars. 

PBB has been critical in developing the 2022 Budget, as the COVID-19 pandemic has continued to bring uncertainty and constant change to the City’s operations and the overall economy. City departments used PBB tools and data to guide decisions for re-imagining and re-examining their budgets. Departments were able to change how they allocate current resources or devise new ways of bringing additional resources into the City.  

As part of the PBB process, departments analyze their programs to identify areas where they can save resources through service level decreases, internal or regional partnerships, cost recovery, program efficiency, program elimination and/or service level increases. For example, for 2022, three significant budget initiatives were made possible through budget reallocations that resulted in no increase in property tax revenue—In-house Electrician, Safety Codes Services and Organization Development and Technical Advisor. 

Each department includes a program-based budgeting display within this budget that helps explain the true cost of service delivery. 

“I am incredibly pleased with the City’s progression and continuous improvement with program and project budgets and PBB tools.  It is a team effort starting with our amazing PBB super users, Finance team, department Directors and staff and all supported by our City Council. The  2022 capital and operating budgets are great examples for transparency, readability/understanding and data driven  methods. I look forward to ResourceX’s new developments in program budgeting tools and our City’s use.” 

John Dance, General Manager, Corporate Services, City of Fort Saskatchewan, Alberta

A community gives its resources to a local government, and in turn, entrusts that local government organization to invest those resources towards a more prosperous future for all. Transitioning from a line-item driven budget to a program budget and budgeting programmatically within the context of priorities creates a clear path from resources to results. Thank you, Fort Saskatchewan, for providing this model for our PBB community and organizations looking to rethink budgeting. 

Priority Based Budgeting connects local government resources with the results most important to the community through program data. Priority Based Budgeting is recognized as a best practice by ICMA, GFOA and Alliance for Innovation. ResourceX has implemented this methodology in over 300 municipalities across North America. Learn more in our Essential Guide to Priority-Based Budgeting.