Assignment 2: Budget Request Revision

Budget Proposal For Miami-Dade County For Fiscal Year 2018/19

Introduction

This paper reviews the budget proposal for Miami-Dade County for fiscal year 2018/19, the budget process, sources of revenue and expenditure.

Overview And Budget Process.

Miami-Dade County is one of the counties in the USA and contains 13 districts. Miami-Dade County has a population of 2.71M people with a median age of 39.9 and a median household income of $45,935. Between 2015 and 2016 the population of Miami-Dade County grew from 2.69M to 2.71M, a 0.74% increase, and its median household income grew from $43,786 to $45,935, a 4.91% increase. The legislative and the governing body of the county is the Board of commission elected into office by the registered voters in a non-partisan election. One county commissioner is elected from each county for the term of four years each; the county chatter normally sets the salaries for each commissioner. The Commissioners elect a Chairperson, who then appoints the Chairperson, Vice-Chairperson, and members of all committees.

The Miami-Dade County commissioners normally plays a lot of roles which includes; reviews and adopts comprehensive development land use plans for the County, licenses and regulates taxis, transportation network entities, sets policy regarding public transportation systems, regulates utilities, adopts and enforces building codes, establishes zoning controls and establishes policy relating to public health, safety services and facilities, recreational and cultural facilities, housing and social services programs, and other services.

The BCC normally sets the tax rates and approve the county budget every financial year. Each year, the commission sets the property tax millage rates and approves the County’s budget, which determines

The expenditures and revenues are necessary to operate all County services, and enacts the County's strategic plan. The County Commission Board may override a Mayoral veto at its next regularly scheduled meeting by a two-thirds vote of those present. The Miami-Date county citizens do not directly play a role in the budget process, but the BCC normally represents them by making policies and advocate them at all levels of government. The Miami-Dade FY 2018/2019 annual budget began on 1st August 2018 and ended 30th June 2019. The budget process takes place in several stages which are a formulation, approval implementation, and audit. Documents essential to the budget process include the budget circular, the budget review, outlook paper, the county fiscal strategy paper, and the county budget estimates. The county has a budget performance analysis which is conducted by each department of the county, and it’s done through the analysis of the outcomes and results. The budget does not include the forecast for future years or prior years. The budget document gives detailed information on sources of revenue and expenditures. The budget report posted in the county’s websites gives information on the revenue analysis and expenditure analysis.

Expenditure and Revenue Trends

The main source of revenue in Miami-Dade County is tourism as a tourist which contributes 5.1% of the total revenue, also property tax and income tax which give approximately 9.9% of the total income and sale tax. In the FY 2018/19, Miami-Dade County registered 28,418 of the total revenue, which is 1.32% increase as compared to that of the previous fiscal year. From table 1, it can be noted that the biggest source of revenue in the FY 2018/19 was general fund countywide $17518 which is 61.87% of the total revenue, this was an increase of 11.64% compared to the previous year.

The county spent 28,418 in the FY 2018/19 which was an increase of 7.46%. Salaries were the main source of expenditure in the FY 2018/2019, recording a total of $15406, that is, 54.21% of the total expenditure. The major sources of growth over this period was from other departments where the expenditure increased by 50.21% this was caused due to low absorption of development budget due to increased population. Other sources of revenue are recorded in table 2.

Table 1 Miami-Dade County 2018-2019 Revenue
	2016 Actual	2017 Budget	Change
Revenue	Amount($ .millions)	% of Total	Amount($ millions)	% of Total	$ Change	% Change
General fund countywide	15,691	59.67	17518	61.87	1827	11.64
General Fund UMSA	5230	19.89	5839	20.54	609	11.64
Carryover	4827	18.36	4823	16.97	-4	-0.082
Interagency Transfer	550	2.08	578	0.62	28	5.1
Total Revenue	26,298	100	28418	23.13	50.11	1.32

Table 2 Miami-Dade County 2018-2019 Expenditure
	2018 Actual	2019 Budget	Change
Operation and non operation Expenditure	Amount $	% of Total	Amount $	% of Total	$ Change	% Change
salaries	14,086	53.56	15406	54.21	1320	9.37
Fringe Benefits	4894	18.61	6046	21.27	1152	23.54
Contractual Services	45	0.171	51	0.18	6	13.33
Other operations	1878	7.14	1870	6.58	-8	-0.43
Charges for county service	491	1.86	482	1.70	-9	-1.83
capital	77	0.29	80	0.28	3	3.90
Reserves	4827	18.36	4883	17.18	56	1.16
Total Expenditure	26,298	100	28,418	100

Conclusion and Recommendation

Even though the county government is trying to reduce the expenditure in the period which in this case it has not achieved. The number of expenditures in the FY 2018/19 increased compared to that of the FY 2017/18. Also, the county own source revenue collection declined by 12.4% from the FY 2018/19 which implies that the county is undergoing major challenges when it comes to management of revenue collection. Therefore the fiscal health of the county does not look good generally. Since the county expenditures seem to increase over time and the revenue collection declining consequently, then it can be concluded that the outlook future of the government does not look promising. As the government experienced fiscal stress, therefore, it increased county taxes to generate more revenues to cover for county increasing expenditure and this in return may scare away investors who may have interest in investing in the county, therefore, losing more revenue.