Chapter 7.12
BUDGET MANAGEMENT

Sections:

7.12.010    Definitions.

7.12.020    Budget submission.

7.12.030    Budget hearings.

7.12.040    Assembly action on education budget.

7.12.050    Assembly action on assembly proposed budget.

7.12.060    Budget amendments.

7.12.070    Service area appropriations.

7.12.080    Budget transfers.

7.12.090    Budget form.

7.12.100    Ordinance and resolution form.

7.12.110    Supplemental and emergency appropriations.

7.12.120    Capital improvement program.

7.12.130    Budget administration.

7.12.140    Effect of procedural error.

7.12.010 Definitions.

As used in this chapter the following definitions apply:

Administrative department” means grouping of borough activities established by ordinance or separate borough offices and organizational units which are to be budgeted, appropriated, and accounted for individually; including, but not limited to, the assembly, mayor’s office, borough attorney’s office, etc., but not including the school district.

Borough” means the Fairbanks North Star Borough, including the school district, unless otherwise indicated.

Encumbrance/obligation” means a commitment to expend appropriations.

Expenses” means the total disbursements and encumbrances made against an appropriation.

Fund” means a separate accounting entity established for a specific purpose.

Fund balance” means those funds remaining in a fund which have not been appropriated.

School district” means the Fairbanks North Star Borough school district.

Service area’s available fund balance” means the unreserved, unappropriated fund balance of a service area remaining at the close of the preceding fiscal year, as certified by the chief financial officer, less 20 percent of the service area’s appropriated expenditure level. (Ord. 90-028 § 12, 1990; Ord. 89-009 § 4, 1989; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.300.)

7.12.020 Budget submission.

A. The board of education shall submit to the assembly and the borough mayor, by April 1st of each year, their formally adopted budget which includes the total cost of school operations for the next fiscal year, and the carry over funds for both state and local sources. Also included in the submission shall be a schedule of estimated revenues which the board expects to receive from all sources, including federal grants, state grants, and miscellaneous collections through local efforts such as facility rental, student activities, lunch sales, etc. The numerical difference between the total budgeted expenses and the total estimated revenues shall be indicated on the schedule as the “Request for Local Support” to balance the schedule with the budget.

B. The borough clerk shall submit the assembly’s budget for the next fiscal year to the mayor no later than 14 days prior to the first Thursday of April.

C. The borough mayor shall deliver to the assembly, on or before the first Thursday following April 1st of each year, the total proposed comprehensive budget of the borough, the recommended allocation of funds to each proposed expenditure category within the proposed budget, and appropriation ordinances in the form provided for in FNSBC 7.12.100(A). Included in this submission shall be:

1. The board of education’s budget as submitted to the mayor;

2. The assembly’s proposed budget as submitted to the mayor by the borough clerk;

3. The budgets of the various departments of the borough executive branch;

4. Each department identified and grouped according to whether it is a direct public service department, a support service department or a governance department, as provided in FNSBC 2.08.030 together with a subtotal for these three groupings;

5. The proposed capital improvement budget;

6. The proposed borough service area budgets accompanied by an estimate of unencumbered funds by service area;

7. The proposed budgets of each fund authorized by the borough, including special and enterprise funds;

8. The mayor’s recommendations on all the budgets;

9. A schedule of all revenues and grants expected to be received during the fiscal year;

10. A proposed appropriation ordinance implementing the mayor’s recommendations on the total budget;

11. The amount of local taxes required to fund the budget and the tax levies required by the area to generate the required taxes;

12. A proposed resolution implementing the mayor’s recommendation for local support to the board of education;

13. A proposed resolution implementing the mayor’s recommendations for local tax levies. (Ord. 2001-10 § 2, 2001; Ord. 90-028 § 2, 1990; Ord. 89-101 § 2, 1990; Ord. 89-001 § 5, 1989; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.010.)

7.12.030 Budget hearings.

A. The assembly shall hold at least one public hearing on the proposed annual budget. Prior to the public hearing the proposed budget shall be submitted to the finance committee and the finance committee shall make recommendation(s) to the assembly on the proposed budget and/or propose a substitute appropriation ordinance. The mayor shall make available at the finance committee meeting(s) appropriate staff members to assist in the finance committee review of the budget.

B. At least five days prior to the public hearing, the assembly shall have published in a newspaper of general circulation in the borough, a summary of the proposed budget, and mill levies. A summary of both the proposed substitute appropriation ordinance, if proposed, and the finance committee budget recommendations shall be available to the public at the public hearing. (Ord. 90-028 § 3, 1990; Ord. 89-101 § 3, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.020.)

7.12.040 Assembly action on education budget.

A. The assembly shall by June 30th determine the total amount of the board of education budget. The assembly may increase or decrease the budget of the board of education only as to the total amount.

B. The assembly shall determine the total amount of money to be made available for local support and shall by resolution furnish the board of education with a statement of said sum, not more than 30 days after the date on which it first received the education budget.

C. If the assembly does not comply with the provisions of subsection (B) of this section, the amount requested in the education budget for local support as initially submitted to the assembly by the board is automatically approved.

D. Notwithstanding the rules of the assembly, no action of the assembly in accordance with this section may be reconsidered, rescinded, repealed or otherwise modified if the presiding officer determines that such modification cannot be completed within sufficient time to enable the assembly to meet the time limits specified in subsections (B) and (C) of this section. The presiding officer’s determination may be challenged in accordance with the assembly rules for challenging any other ruling of the chair. If the presiding officer’s determination that insufficient time exists is thus overruled, a proposed reconsideration, rescission, repeal or other modification may be considered if it otherwise complies with the assembly’s rules and other provisions of law. (Ord. 2005-42 § 2, 2005; Ord. 90-028 § 4, 1990; Ord. 89-101 § 4, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.030.)

7.12.050 Assembly action on assembly proposed budget.

A. The assembly may increase or decrease any item and may add or delete items in the mayor’s proposed budget except as provided in FNSBC 7.12.040(A).

B. The assembly shall, by May 31st of each year, approve the annual budget and shall by ordinance appropriate the necessary funds including the amount to be made available for local support to education. The amount appropriated for local support shall not be less than the amount determined by resolution provided for in FNSBC 7.12.040(B) but it may be higher.

C. If the assembly fails to appropriate the total amount of money to be made available for local support to education, as established by the resolution required by FNSBC 7.12.040(B), on or before May 31st of each year, then on June 1st the amount stated in said resolution shall be appropriated to the school district for the following fiscal year by operation of law.

D. Notwithstanding the rules of the assembly, no action of the assembly in accordance with this section may be reconsidered, rescinded, repealed, or otherwise modified if the presiding officer determines that such modification cannot be completed within sufficient time to enable the assembly to meet the time limits specified in subsections (B) and (C) of this section. The presiding officer’s determination may be challenged in accordance with the assembly rules for challenging any other ruling of the chair. If the presiding officer’s determination that insufficient time exists is thus overruled, a proposed reconsideration, rescission, repeal, or other modification may be considered if it otherwise complies with the assembly rules and with other provisions of law.

E. The appropriation ordinance adopted by the assembly must include an appropriation for each department, fund, capital project or service area.

F. At the same time as the assembly adopts the appropriation ordinance, it shall also adopt a resolution approving the budget document which allocates the appropriations to various expenditure categories. Once the assembly has adopted a resolution approving the final budget document, transfer of funds within appropriations and between categories are permitted only in accordance with FNSBC 7.12.080. (Ord. 90-028 § 5, 1990; Ord. 89-101 § 5, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.040.)

7.12.060 Budget amendments.

A. The mayor or board of education may submit, through the assembly presiding officer, proposed amendments to the annual school district budget during assembly deliberation of the budget; however, these amendments shall not be included when the provisions of FNSBC 7.12.040(C) and 7.12.050(C) apply.

B. The assembly may amend the annual budget and general appropriation ordinance by subsequently adopting supplemental, transfer, or emergency appropriation ordinances. (Ord. 90-028 § 6, 1990; Ord. 89-101 § 6, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.050.)

7.12.070 Service area appropriations.

In the annual service area operating budget, the assembly may allocate each service area’s available fund balance to separate operating savings accounts. The mayor may prescribe procedures for the transfer of moneys from the service area’s operating savings accounts to other categories within the budget for each service area in accordance with FNSBC 7.12.080. (Ord. 90-028 § 7, 1990; Ord. 89-009 § 3, 1989. 2004 Code § 3.03.055.)

7.12.080 Budget transfers.

A. The mayor may approve budget transfers without assembly action as follows:

1. Transfers within an appropriation to or from the expenditure category “Awaiting Budget”;

2. Transfers within an appropriation for a specific capital project, and projects in the special revenue fund, enterprise project funds, and the pass-through grant funds;

3. Transfers within an appropriation for a specific service area;

4. Transfers within an appropriation between categories;

5. Transfers within an appropriation and within a category in any amount.

B. All transfers within an appropriation not specifically provided under subsections (A)(1) through (5) of this section involving amounts more than $20,000 shall be reported to the assembly through the administration by memorandum.

C. All transfers between appropriations to an administrative department, fund, capital project, or service area must be approved by the assembly by ordinance.

D. Transfer of the unencumbered balance within the school district between categories must be approved by the board of education.

E. The mayor may create new temporary employee positions within the limits of appropriated funds and subject to budget transfer limitations, without prior approval of the assembly; provided, however, that the mayor may not create permanent new positions without prior assembly approval.

F. 1. “Appropriation” means the amount appropriated by ordinance to a specific department, fund, capital project or service area.

2. “Category” or “expenditure category” means those allocations of appropriated funds grouped under the headings “Personnel Services,” “Commodities,” “Contractual Services,” “Capital Outlay,” “Awaiting Budget,” “Depreciation (Enterprise Funds),” “Intragovernmental Costs,” “Costs of Goods Sold (Enterprise Funds),” “Operating Transfer Out (Including Indirect),” “Current Operating Expenditures (Service Areas),” “Operating Savings Account (Service Areas),” “Claims and Judgments,” “Litigation Reserve,” “Debt Service Expenditures (Debt Service Fund),” and any other category adopted by the chief financial officer, designated as a category in the budget for an appropriation and approved by the assembly. (Ord. 2008-08 § 2, 2008; Ord. 93-038 § 2, 1993; Ord. 90-028 § 8, 1990; Ord. 89-101 § 7, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.060.)

7.12.090 Budget form.

A. Except as provided in subsection (B) of this section, the mayor shall prescribe the forms to be used by the assembly, administrative departments, other administrative offices, and borough service areas in preparing the budget documentation. In addition, the mayor may establish formal budget instructions and time deadlines. The mayor may review budgets by any method he deems appropriate, make recommendations, and shall submit his proposed budget to the assembly in accordance with FNSBC 7.12.020(C).

B. The board of education shall prescribe the forms to be used for the education budget documentation and is responsible for such budget review as it deems appropriate prior to submission of the budget to the assembly and mayor in accordance with FNSBC 7.12.020(A).

C. Budget documentation for the borough budget, excluding the school district, shall consist of at least fund, administrative department and division breakdown by programs, functions, or goals and objectives; and a comparison to the preceding fiscal year budget as amended. Detail pertaining to number of employees and classification of expenses shall also be included. The board of education is strongly encouraged to provide substantially similar information in its budget submittal. (Amended during 1993 republication; Ord. 89-101 § 8, 1990; Ord. 85-001 § 2, 1985). (2004 Code § 3.03.070.)

7.12.100 Ordinance and resolution form.

A. The proposed appropriation ordinance submitted by the mayor in accordance with FNSBC 7.12.020(C) shall contain the following information in order by fund, administrative department, capital project or service area:

1. The total number of permanent full time equivalent employee positions, including grant or other funded positions;

2. The total estimated grant revenues by project;

3. Other estimated revenues by source and amount;

4. The total recommended appropriations of each fund, administrative department, capital project or service area;

5. The total estimated revenues;

6. The total appropriation to education;

7. Grand totals of all items;

8. A reference to all other items and schedules which are to be incorporated into the appropriation ordinance.

B. The resolution submitted by the mayor in accordance with FNSBC 7.12.020(C) shall contain the total estimated local property taxes required by area, assessed valuation by area, and the required mill levy for each area by service. (Ord. 89-101 § 9, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.080.)

7.12.110 Supplemental and emergency appropriations.

A. Consistent with limitations imposed by law, appropriations may be increased or decreased by the assembly during the course of the fiscal year.

B. Every supplemental and emergency appropriation introduced by the mayor, or an assemblyperson, shall be supported by the original budgeted appropriation for the administrative department, fund, capital project or service area, the expenses to date, the purpose and justification for the appropriation, any additional revenues estimated to be generated, the number of new employees to be hired, the proposed funding sources, the impact on the fund balance and the estimated mill levy and impact on the current and next year’s annual budget, when applicable.

C. In the event of a net shortfall of estimated undesignated revenue, the mayor or board of education shall immediately report this fact to the assembly with a recommended decrease in appropriation, employees or other revenues.

D. In the event of a shortfall of estimated grant revenue or other designated program receipts appropriated for a specific purpose, the appropriation enacted for that purpose is reduced by the amount of the shortfall on the date the shortfall becomes known to the assembly. The mayor or board of education shall report such a shortfall to the assembly immediately upon learning thereof. Should the assembly wish to continue the project or program at its original amount, a supplemental or emergency appropriation must first be enacted providing funds from another source. (Ord. 90-028 § 10, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.090.)

7.12.120 Capital improvement program.

The mayor shall submit to the assembly annually on a date the mayor deems appropriate a six-year capital improvement program including capital projects for education. The assembly shall hold at least one public hearing on the program prior to adoption. The first year plan of the program shall constitute the capital improvement budget and shall be part of the annual budget submission provided for in FNSBC 7.12.020(C). (Ord. 90-028 § 11, 1990; Ord. 89-101 § 10, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.100.)

7.12.130 Budget administration.

A. In accordance with law the mayor and the board of education shall execute the board of education and assembly budgets and the capital improvement program as adopted by the assembly.

B. No contract, agreement or other obligation involving the expenditures of money shall be entered into or be authorized by the mayor, assembly, board of education, employee, or any representative of the borough or school district unless funds have been appropriated for that purpose.

C. In certifying fund availability to the assembly prior to an appropriation, all moneys actually in the treasury to the credit of the fund from which they are to be drawn and all applicable anticipated revenue shall be considered.

D. A bond, contract, lease or other obligation requiring the payment of funds from the appropriation of a later fiscal year or of more than one fiscal year shall be made or approved by ordinance. Nothing in this section is intended to affect assembly authority as established by state law over appropriations to, expenditures by, or contracts of the school district. However, the assembly is not required to provide moneys for a multi-year bond, contract, lease or other obligation entered into by the borough or the school district until the assembly either appropriates said moneys or approves said bond, contract, lease, or other obligation in accordance with this section. (Ord. 2006-12 § 2, 2006; amended during 1993 republication; Ord. 89-101 § 11, 1990; Ord. 85-001 § 2, 1985. 2004 Code § 3.03.200.)

7.12.140 Effect of procedural error.

Failure of the assembly or the mayor to comply with procedures established by these provisions for budget preparation, submission, adoption or management shall not invalidate any subsequent assembly action approving a budget or enacting an appropriation ordinance. (Ord. 90-028 § 13, 1990. 2004 Code § 3.03.310.)