Why now? To effectively manage church funds, there
must be a meeting of the minds (agreement) on what authority the budget
carries. As we look to bolster our fiscal accountability, we should
concurrently shore up some areas where we have operated on individual
presumptions for decades. I have included various perspectives for
consideration, including my draft and a prompt for yours.
From the Federal Perspective. Budget Authority (BA)
is the authority provided by law to enter into obligations that will result in
immediate or future outlays. It may be classified by the period of
availability, by the timing of congressional action, or by the manner of
determining the amount available.
Family Budget (many, not all). This is a strict to-the-penny
layout of how every cent with be allocated. There is no debate or discretion to
alter the budget, well, until the first time someone uses the phrase, but we
need it. Typically, this is a set-the-numbers within the expected income,
and hope it works, and there is nothing unexpected ahead. Multiple revisions
are often needed.
Cavalier Budget. Words and numbers are used for the
sake of display, but at best, they are a guide. This is often the first draft
of a family budget when the family is reluctant to do the budgeting work.
From the Oklahoma Municipal League.
Budgets,
Do I really have to have one? Who is responsible for creating the budget? Are
there legal deadlines?
Who is
responsible for creating the budget? Are there legal deadlines?
Developing
a Budget is a never-ending process. It begins the moment you begin your fiscal
year and ends, only to begin again.
There
are two basic budget options for Oklahoma municipalities. The Municipal Budget
Act (11.O.S. §§ 17-201 through 17-216) and the Estimate of Need Law ( 68 O.S.
§§ 3001 through 3033 & 62 O.S. § 461). You will need to determine which one
is Applicable to your municipality.
It will
depend on your form of government on who prepares the budget.
Aldermanic
form of Government - Mayor prepares the budget
Council-Manager
form of Government - City Manager prepares the budget
Strong-Mayor
form of Government - Mayor prepares the budget
Town
form of Government - Council prepares the budget
The
legal deadlines for municipalities under the Municipal Budget Act are as
follows:
Chief
Executive Officer must submit the budget to the Governing Body thirty (30) days
prior to the beginning of the fiscal year. (June 1st)
Governing
Body must hold a public hearing on the proposal no later than fifteen (15) days
prior to the beginning of the fiscal year. (June 15th)
Notice
of the date, time and place of the hearing together with the proposed budget
summary shall be published in a newspaper of general circulation in the
municipality not less than five (5) days before the date of the hearing. (June
11th)
Governing
Body must adopt budget by resolution at least seven (7) days prior to the
beginning of the fiscal year. (June 24th)
Adopted
budget must be filed with the State Auditior & Inspector and Municipal
Clerk on or before the first day of the fiscal year. (July 1st)
Within
fifteen (15) days after filing with the State Auditor & Inspector, any
taxpayer may protest alleged irregularities.
The
legal deadlines for municipalities under the Estimate of Need Law are as
follows:
Governing
Body must begin preparing Estimate of Need and report of revenues, the first
Monday in August. (1st Monday in August)
Excise
Board convenes July 1, to set schedule for public meetings. (July 1st)
Prepare
Estimate of Needs. (by September 1st)
Submit
financials and needs of estimate to county excise board.
Incorporated
towns by August 22nd. Cities by August 27th
Publication
affidavit filed at least 5 days after budget filing.
Presbytery Budget is formulated by committee input
(generally formed in the summer meetings), the moderator, and the finance
committee. Committee requests should be
as detailed as practical. Unlike the local church sessions, the finance
committee will apportion the budget expense among the several congregations of
the presbytery.
For the Church Budget (Tom’s Draft)
The budget is the authority for designated individuals to
obligate and expend funds. It is in effect for a prescribed period, typically
12 months. It may be changed or modified by the same authority that established
it (in this case the session).
The budget organization is the line item. Many line items
are the sum of other line items. Budget amendments typically are addressed by
the line items affected and the total. While funds may be obligated absent the
presence of funds, all expenditures are subject to the availability of funds.
It is binding upon those authorized to expend funds, but
recognizes that sometimes, the dynamic nature of the organizational mission
creates gaps in reconciliation, and expenses may unintentionally exceed the
authorized funds. The overspending need not result in punitive action, but
further expenditure must cease until more funds are authorized.
To best manage a budget, Fund Administrators (FA) should be
assigned where possible. All expenditure within a specific line item should be
routed through and approved by the FA. In the small church, the FA expends most
of the funds authorized by the budget line item.
Funds may not be moved from one line item to another unless
approved by the session, even when the same FA manages both/all. Some purchases
involve multiple line items. In those cases, FAs need to be especially
attentive to those obligations and expenditures within their purview while
coordinating with other FAs. In practice, most FAs are just managing a check
register as they are also the exclusive expender of the funds authorized.
Your Draft
