OP Budget Committee to target oversight
OCEAN PINES—The message conveyed by Ocean Pines Budget and Finance Committee Chair Dennis Hudson to the Board of Directors, during their Oct. 2 meeting, was that during fiscal year 2014-1215 the committee wants to offer its budget development assistance in a more proactive and targeted manner.
Hudson pointed out that the committee is required by the OPA by-laws and resolutions to provide guidance to the board prior to the budget preparation process.
“In the past we have gone through every department, good, bad or otherwise. We’ve decided that the major thing that we should be concerned about this year in the budget process is revenue—the generation and calculation of revenue,” Hudson told the board. Citing the committee’s oversight authority as proscribed under Resolution F-02 section 2, he said, the committee would concentrate heavily on the details of business plans supporting revenue calculation for the major fee-based revenue-generating departments.
“We’re not going to spend a great deal of time on other items,” Hudson said. “We will de-emphasize those departments who have in our review, processes that seem to have supporting documentation to support revenue forecasts.”
OPA President Tom Terry called the committee’s plans to focus on targeted revenue projections a “very good idea.” He added that some of the information compiled by the committee would be part of what the board would use when it provides guidance for General Manager Bob Thompson’s budget.
This is Hudson’s second budget cycle as Budget and Finance Committee Chairman. He said in an Oct. 8 interview that committee members felt that in past years the relationship between the committee and management had been adversarial. Last year the parties had worked to build more cordial relations, he said. The committee now wants to expand on that improved relationship by offering more assistance to management, he said.
Last year, the committee spent a week meeting with department managers to determine their responsibilities. The committee also conducted a line-by-line examination of department budgets, according to Director Bill Cordwell, who was previously a member of the committee and now serves as the board’s liaison to the committee. He said the information gleaned from the meetings and examinations proved to be “very enlightening” and was the basis from which the committee developed the guidance report provided to the board. He also noted the review showed department spending had been “lean.”
The board is now in the process of examining the committee’s review and analysis to determine which items to adopt for inclusion in its guidance to Thompson. The first of those meetings began Oct. 7, according to Cordwell.
He said he had a lot of respect for everybody who served on any of the OPA’s committees, because of the amount of time and effort he knew that service required.
Hudson said committee members did not want to review department budgets after they had already been completed. Rather, they wanted to participate in the budget development process, which he said would require cooperation and an open dialogue with both the board and management. But he told the board, “If you need us, we’re there. We want to see how the revenue process is constructed. When it comes time to approving the budget I think we can add a great deal to that by commenting on the accuracy of that process.”
The committee report requested explanations for the current year capital/reserve variances, along with the action plans to correct and reduce the errors. Hudson requested that Controller Art Carmine put explanations of variances of 5 percent or more in writing, including capital reserves variances.
Hudson said the committee wanted to delve into the causes for the variances, but acknowledged the need for a balance between requesting information needed for a effective uation and avoiding overwhelming staff with too many information requests.
The committee also requested information on the current process for making performance measurements. Hudson said the committee found two or three studies in the archives on how to measure performance, but it did not appear they had been fully implemented. Questions from the committee, he said, would include: what was the current performance measure criterion? How was it developed, and what new or additional processes needed to be implemented in the process?
The public presentation and final approval of the 2013-2014 budget were conducted in February this year.