If you ever wonder how on earth OKCMAR & MLSOK budgets for the year I thought I would share the process with you. First we have a three year budgeting cycle which acts as a guide. This would be year 2. Second while the 3 year budget is a guide we are required to zero base budget which means we look at each line item separately and start at 0 and determine the current cost of a program and the current income (if any) of a program. The three year budget determines basic items in line with the strategic plan such as what trainings the board and/or staff will go to, how much will be spent on advertising & promotion, how many events will be put on, etc. All of these include a target income or loss for the year.
Today is the most difficult but also the most enjoyable part of the process. The department heads will develop proposals in alliance with the strategic plan and 3 year budget for their respective departments. They will argue passionately for items they believe are necessary for the development of the strategic plan and to further the goals of their assigned committees. At the end of today we will have preliminary budgets for each corporation. This year, is the first year in years that OKCMAR's budget will not have a projected/budgeted loss. Last year MLSOK operated at a substantial loss in order to take advantage of tax incentives but for 2011 MLSOK will operate slightly above break-even in order to replenish the reserves that were used to gain the tax incentives. Last year was the year of capital expenditures and capital improvements- this year and next we hope to reap the rewards of the planned spending.
Next the budgets go to the finance committee where the budgets are picked apart and members representing all of you discuss program cuts and program additions. If the budgets pass this stage (which is rare- last year this stage was repeated twice) they go on to the respective boards where the process is again reviewed. If the budgets pass this stage they become implemented if not they go back to committee and the process starts again. In an average year the budgets are revised at least 5 times. The staff, finance committees and the leadership totally know this is YOUR money and feel very responsible for spending it wisely.