Zero-based budgeting has generated some buzz on the campaign trail during St. Albert’s municipal election but a current and former city manager say it’s a practice that’s already largely in place.
A number of candidates seeking seats on city council are calling for the adoption of zero-based budgeting, a system where spending is reset at zero each year rather than building on the previous year’s budget. City manager Bill Holtby said the approach wouldn’t be that new.
“We do use the principles of zero-based budgeting in the preparation of our budgets,” Holtby said.
He noted that, rather than city council, it’s city staff who are in charge of managing the budgets that essentially start from scratch every year.
“If council were to probe down into each of the thousands of services that we provide it would be, I believe, an insurmountable challenge to get into that level of detail,” Holtby said. “There might be a desire to go deeper into the level of detail. We’re more than open to do that.”
During budget deliberations, councillors are provided a budget synopsis but also have access to line-by-line information if they want, Holtby said.
Council’s role is generally to lay out the level of services required or desired and it’s administration’s role to calculate the cost to deliver the services in the most cost-effective manner, something city staff take very seriously, Holtby said.
“It’s a question of governance over administration,” he said.
“Is it the professional transit director that knows the details of how to run a transit system versus an elected official that knows that they want transit to run every 15 minutes throughout the community?”
One idea commonly heard on the campaign trail is that city council only debates incremental increases in the budget rather than historic funding levels. Holtby refuted that.
“They may focus their discussion on increases but the information is available in terms of the trending and the history,” he said.
The budget process usually comes as a shock to new councillors, said retired city manager Norbert Van Wyk.
“If people could live that process for a period of time I think they might have a different view of it,” he said.
Typical municipal budgeting involves a hybrid of zero-based and incremental budgeting, he said.
“Council doesn’t just focus on the increases. Council focuses on the entire budget,” said Van Wyk, who was city manager in St. Albert from 1991 to 1998 and Red Deer from 1998 to 2006.
He refuted another commonly-held belief, that city budgeting leads to excessive spending out of fear of getting less money in the next budget if the current year’s budget isn’t exhausted.
“The system does not create, in my experience, a spend it or lose it attitude,” Van Wyk said. “That simply is not what I have experienced in any manner whatsoever in all my years in local government.”
Using a pure zero-based budgeting system in a municipality is unheard of, said former mayor Richard Plain, an economist.
He thinks there is merit to the intent behind some candidates’ desire for more budget scrutiny. Plain feels council could achieve such oversight by calling for rolling reviews of the city’s business plans, which would allow councillors to ask probing questions and seek justification for all expenses.
“All those things are good,” Plain said, “but to claim that there’s some type of superiority built into a zero-based budget plan that would really sort things out, I just don’t think it’s practical or desirable.”
