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Board Report #99-5

Appendix A

Major Budget Policies 1999-2001

 

BUDGET TARGET POLICY/REDUCED BASE BUDGETING/INCREASED BUDGET FLEXIBILITY

Balancing the general fund budget in 1999-2001 will require spending restraint and spending reductions, especially in FY00. Tax relief initiatives will be the top priority and will absorb the majority of available revenues.

Base level funds will need to be used to meet high priority needs.

Each agency's GPR budget request should meet the budget target policy: For FY00, it should not exceed 100% of the FY99 adjusted base year. For FY01, GPR requests should not exceed 101% of the FY99 adjusted base.

Each agency must also include a reduced base budgeting plan for reducing its GPR budget base for state operations less debt service, plus aids to individuals and organizations, to 95% of base in each year. This means 5% of the adjusted base for FY00 and 5% of the adjusted base for FY01 for all state operations appropriations less debt service, plus aids to individuals and organizations. As part of this plan, and to provide greater flexibility for agencies to manage with limited resources, agencies are especially encouraged to consider the following elements:

The 95% reduced base budgeting plan and budget target policy will also apply to state operations administrative appropriations of the segregated Conservation, Transportation and Lottery Funds.

STRATEGIC PLANNING AND PERFORMANCE MEASUREMENT

Strategic Plans. All agencies should be engaged in strategic planning and budget requests should be linked to those plans.

Performance Measurement. Performance measurement will be implemented on a pilot basis in 1999-2001. Central training has already been provided to agencies that are required to include performance measures in their budget requests for the upcoming biennium. Other agencies are encouraged to begin identifying suitable measures for their budget programs. Based on experience gained in the pilots, standardized training will be provided to agencies in FY00. An appendix (Appendix K) to the budget instructions provides guidelines on performance measurement and budgeting.

BUDGET PREPARATION PROCEDURES

Standard budget adjustments for required salary and fringe full funding will place a large demand on 1999-2001 revenues. The adjusted base will build in only 75 cents on the dollar of 1997-99 pay plan costs - the amount that is estimated to be available for supplements in FY99. It is expected that the remaining 25% will be provided through the usual full funding adjustment. The costs of FY99 performance recognition awards and discretionary compensation adjustments in all funding sources will not be budgeted in 1999-2001.

Costs of an additional (27th) pay period for bi-weekly payroll agencies in FY01 need to be anticipated in all appropriations with positions. Non-GPR appropriations should estimate these costs and budget them as an explicit non-appropriated reserve, using variable fringe costs of 22.9%. All appropriations with bi-weekly payrolls will be given supplemental spending authority as in normal pay plan.

Agencies that were required to lapse 2% of their FY99 state operations funding (per s. 6ng. 1997 Wisconsin Act 27) will need to implement those lapses in their appropriations as permanent reductions to their funding and position levels. An assigned (standardized) decision item code of 4000 -- 2% State Operations Lapse Reductions -- must be used for this purpose.

Preliminary B-1 and B-9 reports will be produced and distributed to agencies so that coding errors in PMIS and the B-2 systems can be identified and corrected through standard file maintenance prior to production of the final B-1 and B-9 reports.

Copies of B-1 position listings and B-2 records of the adjusted base year will be provided to agencies in Excel format. This will facilitate calculation of the certain standard budget adjustments and permit agencies to reformat data to meet their individualized needs.

Agency budget officers are required to include with their agency's formal budget submission a signed Checklist that verifies that key components of budget preparation have been included. The Checklist may be taken from Appendix L.

To help standardize treatment of common budget preparation elements, a Model Budget, best practice section has been added to the instructions. See Appendix M.

BUDGETING FOR INFORMATION TECHNOLOGY

The Department of Administration strongly supports making appropriate investments in information technology (IT). Priority for new funding will be given to projects with demonstrable savings and with quick paybacks from savings.

Savings realized from previous IT investments should be applied to any new requests. Identifying specific savings from past IT items provides the best argument for further investments.

Base level budgets will be the best source to fund new and existing projects, including items agencies have identified as needed to migrate to basic information technology infrastructure standards.

Funding for projects to address the Year 2000 problem will have to be provided from base level IT budgets.

New GPR funds available for all initiatives in the 1999-2001 budget will be limited, including funds to meet IT standards or undertake new IT initiatives. Funds for these IT items may be requested but will be subject to the overall budget targets.

FEDERAL FUNDING

Agencies are encouraged to make sure that they are obtaining as many federal grants and as much in federal matching funds as possible.

Proposals to expend funds from newly created federal block grants must identify current state and federal law requirements, current Chapter 20 appropriations and the proposed purposes and appropriations for expenditure of the new federal block grant funds.

Federal-funding reestimates should use defined decision item codes as described in the technical instructions.

STATUTORY LANGUAGE

Agencies should not submit policy items that are unrelated to appropriation changes for inclusion in the Governor's budget. Please contact your DOA budget analyst if you would like to discuss whether a particular initiative is appropriate for submission as a budget request.

Agencies should not submit extensive lists of technical and administrative changes for inclusion in the Governor's budget. If you would like to propose such changes as separate non-budget legislation, please submit them separate from your budget request to the Department of Administration for review and approval. Again, please contact your DOA budget analyst if you intend to prepare and submit such a proposal.

As in past budgets, prior to September 15 agencies may work directly with the Legislative Reference Bureau preparing statutory language items for the budget. After September 15, however, all drafting (and redrafting) requests related to the budget must come from the State Budget Office.

See Appendix I in the detailed budget instructions for more discussion on this matter.

DUE DATES/BUDGET SUBMISSION PROCEDURES

The following deadlines are established for submission of these major budget policy components:

Agency budget directors will be required to include with their budget submissions a signed checklist of "budget elements completed." This will help ensure all necessary and appropriate materials have been included in the budget. The formal instructions for 1999-2001 will include this checklist.

State Budget Office staff will present a technical workshop on budget instructions and "best practices" on July 20. This will cover basics of budgeting and things to be careful of when developing budgets. It may be of particular interest to smaller agencies and new staff of all agencies.

 

TIMETABLE FOR BUDGET DEVELOPMENT
June 1, 1998 Budget Instructions are mailed.
June 17, 1998 Program/Appropriation printouts mailed.
June 30, 1998 Preliminary B-9's distributed to agencies.
July 2, 1998 GPR-Earned printouts are mailed for FY99 reestimate.
July 8, 1998 B-2 file maintenance fixing any errors on preliminary B-9's is due.
July 10, 1998 Final B-9 worksheets are distributed.
July 13, 1998 Program/Appropriations are verified to DOA.
July 20, 1998 Budget Workshop, 8:30, 041 GEF III.
July 22, 1998 Completed Final B-9's are due in DOA.
July 27 (week of) B-1 Position Printouts & electronic files are (e)mailed.
July 27 (week of) Adjusted base B-2's are returned to acencies.
August 3, 1998 Reestimated GPR-Earned printouts due in DOA.
August 3 (week of) DOA FY99 chargebacks (finance/risk management) go out.
September 15, 1998 Agency budgets are due in DOA & Legislative Fiscal Bureau.
November 16, 1998 Agency 95% budget recommendations due in DOA & LFB.

 

Board Report #99-5

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