Governmental Budgeting Process

Governmental Budgeting Process

Budgeting in the public sector is typically performed with the culmination of many departments. It combines planning and budgeting to assist individual departments in developing their budget to be consistent with specific objectives as well as strategic goals. Revenues can be particularly challenging to forecast due to unknowns such as enrollment and state funding. “Black Hawk College relies on three primary sources of revenue: tuition and fees, property taxes including Corporate Personal Property Replacement Tax (CCPRT), and state funding” (Black Hawk College, 2009). In addition to these revenue sources, the college receives revenue by way of interest income, facilities rental, federal sources, customized training, and contingency funding.

Tuition and fees comprise 42 percent of overall revenue received. During the process of budget building the Chief Financial Officer is charged with determining an appropriate increase to tuition and fees which is then voted upon at the February board meeting. Fees included are instructional materials fee, auxiliary fee, and technology fee.

Property taxes from the nine (9) counties the college serves are levied each year for all taxable real property in the district on the basis of the equalized assessed property values (EAV). The assessed values are established by each of the respective counties. CPPRT is classified as local source revenue.

State funding is received through two primary sources: Illinois Community College Board (ICCB) Equalization Grant and ICCB Credit Hour Grant. “The equalization grant attempts to reduce the disparity in local funds available per student among each district” (Black Hawk College, 2009). The credit hour grant is...

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... retraining or enhanced training.

In conclusion, revenues can be particularly challenging to forecast due to unknowns such as enrollment and state funding. It is imperative the college be able to forecast when revenues will be received and in what amounts as well as when expenditures will occur and in what amounts over the course of the fiscal year and beyond. With a watchful eye on the economic conditions in the area and a keen sense of forecasting the community wants and needs, it is possible to make accurate predictions as to revenue.

Works Cited

Black Hawk College. (2010, October). Comprehensive Annual Financial Report Fiscal Year Ended June 30, 2010. Retrieved February 16, 2011, from http://www.bhc.edu/DocumentView.aspx?DID=1809

Lee, R.D., Johnson, R.W., & Joyce, P.G. (2008). Public budgeting systems (8th ed.). Massachusetts: Jones and Bartlett