The Budget & Appropriation Process

The budget document is the instrument used by the budget-making authority to present a comprehensive financial program to the appropriating body. The legalistic view is that a budget is a plan of financial operation embodying an estimate of proposed expenditures for a given period of time and the proposed means of financing them. In the general sense, budgets are the financial expression of plans prepared by managers for operating an organization during a time period and for changing its physical facilities and its capital structure.

The budget preparation process for all cities is governed by Massachusetts General Law ( M.G.L.) Ch. 44. The General Laws require that the budget be supported by revenues earned during the year plus any savings from prior years. Mass General Law also requires public involvement in the process including the requirement for a public hearing on the proposed budget.

The Mayor provides leadership in the budget process by developing budgetary policy and working closely with department heads and the City Council to assure that the process identifies community needs and priorities and develops a farsighted and well-crafted plan. The Mayor initiates the budget process that provides the policy context for identification of priorities and development of initiatives. The Charter dictates the process, including timeline.

The Finance Department prepares budget packages for each department in November. The Mayor holds a meeting, attended by all department heads and finance personnel, with a general overview of the state of the economy and an outline of specific guidelines for the preparation of individual department budgets. In consultation with the Finance Department, each department then prepares an operating budget entering their requests directly into the MUNIS accounting software and a providing a narrative outlining their projected goals for the future. These operating budgets are reviewed by the Finance Department and then prepared for the Mayor’s review.

The School Department’s budget is prepared by the Superintendent of Schools and the School Business Manager and the Budget Finance Subcommittee to the School Committee, and then approved by the full School Committee. The process is dictated by Section 5-2 of the City Charter. At least 111 days before the start of the next fiscal year, the School Committee’s budget is submitted to the Mayor.

During the month of March, the Mayor finalizes the budget for submission to the City Council. The proposed budget documentation is prepared by the Finance Department. The City Council accepts the budget and submits it to the Ways and Means subcommittee. The City Council subcommittee then holds meetings with the Mayor, Finance Director, City Auditor and department heads to review each departmental budget. The budget must be approved by a majority vote of the City Council within 60 days of receipt of the budget, but no later than June 30 of each year.