This week's events with the Merrimack budget started a discussion which lead into the question of how budgets work in NH. As someone who's served six years now as a member of the budget committee in Merrimack I can help shed some light on the over all basics of the process as well as what some of the numbers voters see mean and what power voters have to make changes along the way.
Voters are presented with two numbers on their ballots, a budget amount and a default amount but what do these numbers mean and represent, let's dive in and see...
The budgets start at the administration level where a budget book is put together with individual line items each with dollar amounts associated with them. Depending on the town these line items look a little different. Some towns I've seen give very detailed specifics where as others such as Merrimack have more generic lines. You can look at Merrimack's budget in the same form the budget committee receives HERE.
A sample line would look like this:
100-1270-30-8322-13 Gift & Tal/Prog DEV/TFS
2009-2010 Budgeted $1,200.00
2009-2010 Expended $1,099.00
2010-2011 Budgeted $1,200.00
2011-2012 Budgeted $1,200.00
To provide the students enrichment and differentiated programming. This account funds the Gateway program and includes Art, Music and Physical Education enrichment activities.
The governing board has first say on these numbers. They can remove lines, add to lines, lower lines or whatever else they wish.
After they have their final say on the numbers in the budget book the budget is passed to the budget committee assuming the town has one. In the case of Merrimack the budget committee had its role changed after the charter was passed so now the committee only has say over the school budget where as before it had say on the town and village district as well. Other towns are different.
Assuming there is a budget committee in the process they review the budget and can make changes making motions to add, decrease or remove line items.
At this point in the process there is some debate on the true power of the budget committee. Since the governing board can redirect funds at any time the budget committee is really only impacting the bottom line. But the catch is the governing body has to have a line they can charge against. If a line for a new vehicle is lowered to $1 the governing body can still take money from elsewhere in the budget to buy that new vehicle where as if that line were set to $0 and removed then they couldn't.
In Merrimack's case several items are usually combined under single lines so "maintenance" will have the costs of a new roof, new desk, new carpeting or whatever is all mixed together. If the budget committee objected to the desks for instance and cut that amount the board could still buy them on that same line item with money from elsewhere in the budget.
After the governing body and then budget committee has had their say they each open the budget up for the town to comment in a public hearing. These are the publics first and best opportunities to seek changes to the budget since the governing boards at this point can change the specific lines in question.
Once the final public hearing has been had the budget moves on to the deliberative session. In the case of Merrimack this meeting is separate from the town elections, in other towns the two are combined as one.
At this point in the process the public no longer has any say on individual lines. If your upset about an amount being spent on a specific issue you can make a motion at the meeting to cut the budget by that specific amount but it doesn't remove the line and ultimately at this point it's up to the board to determine where it is actually cut. They may decide to keep that item and take the money cut from somewhere else. Likewise if money is added to a budget for the intent of a specific item the board may choose not to spend it at all or they could choose to use it for something totally different as long as it can be justified against a line item somewhere in the budget and the bottom line isn't exceeded.
Once passed the deliberative session, towns like Merrimack that have separate voting dates are left with two numbers, the final bottom line that came out of the different meetings and the default budget.
The default budget is a number that could very well be a full article of itself but to sum it up briefly it's the budget from the prior year adjusted to meet contractual obligations minus any one time expense as defined by the governing body. This "one time expense" is subject to debate because depending on how the budget line item is worded you can have large expenses carried into the following years default budget.
Example of this would be if a building had new carpeting put in. If a line is created for "new carpets" that would clearly be a one time expense, however if it is put under a line for "building maintenance" that's something you would have every year.
For this reason you will find that you may have a default number greater then the budget itself.
Unfortunately other then complaining to the governing body and stating you disagree with the default number the average citizen has no real say on it.
When all is said and done, the final number approved by the voter becomes the bottom line the local branch has to spend. Hope this is helpful in some way.