Financial Administration in the City of San Antonio TX - Essay Example

? Financial Administration Number Financial Administration Budgeting in the of San AntonioTX is done by the office of Management and Budgeting. It is meant to act as a financial guide, a policy paper and a financial plan (Maria, 2011). The city of San Antonio TX budget is well formulated and executed. The budget presents an adequate overview of the entity and its financial position. This is so because it provides a summary of all the budget components, its allocation and the role of these components in enhancing the objectives of the city. The budget summary covers the element of public safety, where the police and the fire department of the city are committed to respond to the safety needs of the city residents. The budget seeks to increase the number of officers in patrol and also the fire vehicle technicians. Street maintenance is another element covered by the summary, with an additional $ 1.8 for pavement preservation and some more $6 million provided to cater for advanced transport (Maria, 2011). Animal care services will be catered for by a $1.7 million while education and library services will be funded to a tune of $30.6 million, which will cater for the construction of new libraries and fund the operations of the already existing ones. Employee compensation and Economic development are the other components of the budget, allocating $32 million towards civilian salary adjustments and $7 million to support the creation of new jobs, support new business development and encourage new investments (Maria, 2011). This gives a brief overview of the budget and its components, while giving information about the city objective at a glance, to make the city government smarter and more efficient. The greatest percentage of the operating budget is accounted for by public safety, which involves fire and police department, financed to a tune of $343 million, in a total adopted budget of $948 million. The reason for such huge funding of the department is because the public safety is the priority of the city of San Antonio TX (Maria, 2011). To enhance this public safety through community policing and neighborhood teamwork, the budget seeks to increase the number of officers in patrol for narcotics by 17 more. It also seeks to add another 25 officers to the service of the people and an additional 4 fire vehicle technicians to enhance rapid response services to the public. The department is also to be awarded with two more management analyst to enhance the management of the police and the fire department, and to enhance its effectiveness and efficiency. The technology used by the department is to be advanced through new software development and installations, meant to improve the payroll division of the department. Owing to the above needs for improvements in the department of fire and police, and due to the crucial role it plays of providing public safety, the city’s office of management and budget sought to allocate more fund to this department (Paul, 1998). The department alone accounts for close to 40% of all the funding done in the annual budget of 2012. This is a clear indication that the interest of the city residents takes priority in the city’s management issues. Police protection is the category within that area that accounts for the greatest budget, being a key service that is very crucial for the wellbeing of the people. A total of $1.5 is to be dedicated to the improvement of neighborhood and narcotics patrol. This is meant to increase the presence of police in all the areas of the city, thus reduce the rates of crimes and drug abuse. $850,000 is meant to reassign 17 police officers to patrols, while $597,000 is meant for increasing the number of officers serving the community neighborhoods. A new helicopter mechanic, and another new helicopter mechanics supervisor are to be hired to increase the efficiency and effectiveness of services delivered to the people by the fire and the police department. This will be funded to a tune of $113,310. The number of uniformed police officers is to be increased to 2,375 (Maria, 2011). The fire and emergency medical services are also crucial to the welfare of the people, having a total of 300,000 invested to improve fire operations. While $200,000 is budgeted for the hire of new emergency vehicle technicians, the $100,000 is dedicated to improve the payroll administrative support. The uniformed firefighters are to be increased to total 1,658. Firefighting and paramedic training are to be carried out in the year, so as to improve on the skill of the fire fighters and the paramedic staff, to ensure the provision of quality services to the people in case of emergencies (Maria, 2011). The city of San Antonio TX operates a total of $2.21 billion as the budgeted funds for the year 2012. The funds are subdivided into $1.65billion for total operating expenditure and $565 million to cover capital expenditure. The funds are drawn from various sources. Property tax revenues account for the 25% of the annual budgeted funds, sales tax revenues accounting for 21%, cps revenues accounting for 31% and other sources accounting for the remaining 23% of the total budget amount for the year 2012 (Paul,1998). The sources of revenues can further be broken down into city sales tax, which is a revenue obtained from the taxation of business involved is sales, CPS energy revenue which is a revenue collected from the CPS energy project, through the taxation of the forms of energy the project produces and sells, such as electricity, natural gas, solar and wind power and revenues generated from licenses and permits to operating business. The other sources of revenues include general government operations, where in the municipal courts collects revenues from the state after the payment of fines by defendants in this courts, health revenues including payments made to obtain birth and death certificate, other fines charged by the city management to offenders who breaks the rules and regulations of the city and revenues collected from other city agencies (Paul, 1998). There are also revenues generated from interest earnings in the projects that the city’s management has invested in as well as recovery of expenditures from sources such as insurance checks. The city operates a separate capital budget from the normal operational budget, which is financed to the tune of $565 million, for the year 2012. The city has adapted immediate development programs to be undertaken within the financial year 2012, and a long term development program, which is to be run for the next 6 years period. These developments are to be covered for by the capital budgets set aside each financial year. The immediate capital expenditure program include the distribution of the budget $565 million to various development programs (Maria, 2011). These programs include: The construction and renovation of streets, which will be funded at $193,245, building air transportation infrastructure, funded at $88,689, construction of drainage systems at $100,147 and the construction of law enforcement facilities and public parks funded at $41,456 and 30,062 respectively (Paul, 1998). The capital expenditure for the year 2012 also entails the construction of Municipal facilities, funded at $67,602, purchase of fire protection equipment to a tune of $ 22,358 and the installation of information technology devices, funded at $10,185. It is also within the objectives of the city’s management to construct new libraries at a cost of $3,601, funded from the budgeted capital expenditure budget for the year 2012 (Maria, 2011). On top of the immediate short term developmental programs, there are other long term development projects, which are to be funded through capital budgets set aside every year for the next 6 years duration. The city’s management has forecasted the total capital expenditure for the next six year period, and the activities the capital budget would finance (Emily, 2011). The capital expenditure to be extended for the next 6 years will cover the same development projects covered by the capital budget for the year 2012. This expenditure is forecasted to be as follows: The total capital budget for the six years period will amount to $1,034,334. The capital expenditure fund is meant to cover the development projects through funding them, at $229,559 for the construction of and renovation of streets, $422,136 for the construction of air transport facilities and $ 117,043 for the construction of ample drainage system in the city. $ 41,456 will be used for the construction of law enforcement facilities over the six year duration, while $92,254 and $ 92826 will be used to construct public parks and municipal facilities respectively, for the entire duration of six years (Paul, 1998). There will be a purchase of fire protection equipment, funded to a tune of $25,147, installation of advanced information technology facilities funded at $10,185 and a construction of Libraries at a cost of 3,601 for the extended period covering between 2012 and 2017 (Emily, 2011). This serves to clearly indicate that the San Antonio TX city’s management are development minded, adopting both short term and long term developmental projects, so as to meet the growth objective of the city in the long run. The development agenda is well catered for by the actual capital expenditure budget for the current year and the forecasted capital expenditure for the subsequent five years. There are some indicators of the financial health of the City of San Antonio, TX. The fact that the sales tax receipt for the first three months of 2012 exceeded the budget by a 1.2% margin is a clear indication that the city’s financial system is healthy (Maria, 2011). Revenues collected for the first quarter of the financial year 2012 are observed to be encouraging, and the total collection for the whole year, from license and permits revenues for food establishments is forecasted to reach a high of $206,000. The revenue collection for the first quarter from other city agencies is observed to be higher than the budgeted. Furthermore, revenues collected from recovery of expenditure are set to increase, based on the high value obtained in the first quarter as compared to the budgeted amount. This is set to increase these revenues to a high of $150,000 by the closure of the financial year 2012 (Paul, 1998). The continuous increase in the amount of capital expenditure budgeted for the next six years period is another indicator that the financial system of the city of San Antonio is healthy. The other indicator that the financial system of the city is healthy is the observed increase in the funding of operations budget, as compared to the previous year. The number of uniformed police and uniformed fire fighter is set to be increased in the year 2012 (Emily, 2011). The increment of the allocation towards civilian salary and the increased allocation of funds to stimulate new business ventures and create employment opportunities are reasons enough to indicate that the financial system of the city is healthy. However, there are some financial dangers that need to be monitored. The CPS sales for the first quarter of the year 2012 were observed to have dropped from the budgeted sales. This is likely to lower the revenues generated from the CPS energy project sales by a reduction of $5.3 million (Paul, 1998). The revenues collected from the general government operations, notably the fines and fees collected by the municipal courts were observed to fall, as a result of low case cited in the first quarter of the year 2012. This is likely to lower the revenue projected for collection by the closure of the year. The revenues collected from the fees payable for the issuance of birth and death certificates were observed to have decreased in the first quarter of the year. This came as a result of a decrease in city usage to obtain the certificates. Consequently, this may affect budget by lowering the actual funds from the budgeted ones (Paul, 1998). The revenue collections from interest earnings may also limit the achievement of the budget targets. This is because; there was an observed decline in the interest earnings collected for the first quarter of the year. This was caused by a decrease in the rates of interest charged from a forecasted rate of 0.44% to a lower rate of 0.1822% (Emily, 2011). All the above factors indicate that that there could be some dangers associated with this budgeting, where the actual revenues collected could be lower than the forecasted amounts. The General funds balance is $6.9 million, with a general funds savings of $23,963,813. The various enterprise funds balance are as follows: Development services fund revenues increased by $2.2 million, an increase of purchasing and general services at with a margin of $0.75 from the planned and a decrease by 16% of liability claims and 10% worker compensation respectively (Paul,1998). This trend shows a growth in the general and expenditure balances in a manner that is adequate to meet the proposed budget growth. This is so because, most of the enterprise funds balances have indicated a steady growth of up to $.75 in some enterprise expenditure elements, while there has been a notable decline in the liability claims and worker compensation claims. This is good for the maintenance of a healthy financial system for the city. A very huge growth in the funds balance or a very small growth is unhealthy for the city’s management. At the same time, an increase in the liability and other enterprise expenditures is not suitable for the city’s management. Therefore, a steady growth that is within a range that can be controlled is desirable (Emily, 2011). It therefore follows that the budgets growth is sufficient to meet the future desired objectives of the city’s management, towards achieving efficiency and effectiveness, while making the government city a smart one (Paul,1998). In conclusion, the city of San Antonio is one of the fastest growing cities in the US. It is gradually becoming an industrial and business hub, integrating the current technologies to enhance the city’s growth. No wonder therefore that budgeting is a core activity of the city’s management, in a bid to ensure that the city’s growth is well planned for and all the essential facilities, infrastructure and public safety are integrated within the city’s growth vision. The budgeting of the city of San Antonio TX can be observed to be well executed. It has implemented its budget well, to an extent of affording it a surplus collection of revenues from some of its revenue sources. However, it is not without certain challenges such as a failure to meet the target budget funds in some of its budget areas. Worth noting is the fact that public safety is the most prioritized of the city’s budget items, having a higher funding relative to other budget items. Over the years, the amount of financial resources for budgeting has been constantly increasing. This has afforded the city’s office of budget management ability to plan for both operational and capital expenditures. The city has adopted a six year development plan, to commit its capital expenditure budget to improve its facilities and infrastructures. Therefore, the budget of the City of San Antonio TX has a well balanced budget. Works Cited Maria, D., et al. (2011). City of San Antonio: proposed annual operating and capital budget Fiscal year 2012. Office of Management and Budget. Emily, Hutchison (2011). The city of San Antonio TX. Journal of Economic Development analysis. Springer. Paul, K. (1998). San Antonio: Development for Environmental and Social Sustainability. Journal of Economic Issues. Association for Evolutionary Economics. Read More