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Finance director proposes expanded budget policy, annual reviews and tighter spending controls
Summary
Staff presented an updated budget policy that clarifies roles and responsibilities, separates equipment replacement into a standalone policy, removes some city-administration approval steps and tightens cost-control rules requiring departments to be in-budget before spending.
Miss Holden presented a plan to update the city's foundational financial policies, providing the committee with the old policy followed by a revised, expanded version in the meeting packet.
She told members the revisions clarify roles and responsibilities among department heads, finance and city administration to create separation-of-duties safeguards and reduce fraud risk. "We made sure that we lined those out so that way we could document separation of duties within this policy to reduce fraud risk, misappropriation of funds," she said.
Holden said the equipment replacement portion of the old budget policy will be broken out into a separate capital/equipment replacement policy, and that the budget policy will include a stricter cost-control strategy: departments will need to be in-budget prior to spending rather than being allowed to overspend within chart-of-accounts classifications.
The proposal also narrows certain city-administration approval requirements for budget transfers; Holden said finance will hold the budget and that city administration will retain some review duties but will not be required to approve routine transfers that previously added delay.
She said the finance director and city administrator will review the policies at least once a year and return recommended changes to the committee. Committee members expressed support for the clarity and standardization the updates provide.
