The past two years have garnered more challenges than many local government leaders have experienced in their entire careers. However, with such hardship comes the unique opportunity for innovation, growth, and serious breakthroughs in all areas of local government. One such area that needs some extra attention, now more than ever, is budgeting. Communities around the world are facing unprecedented economic challenges, making the need to rethink budgeting processes much more prevalent. Municipalities all over the world are taking an innovative approach to curating budgeting strategies that fit their communities, and we have gathered five standout practices that add an innovative touch to the budgeting process.

Transparent

Garnering trust from your community requires total transparency in all areas, but especially in finance. Giving citizens the tools to see their tax dollars at work will help them grasp the inner workings of local government and foster an environment of greater understanding. Many communities around the world are utilizing financial transparency tools to give citizens the power to interact with their community’s financial information. Las Vegas, Nevada, displays its commitment to financial transparency through an open data portal designed to provide residents with quick, user-friendly, centralized access to financial planning, documents, and data. Residents can view current, upcoming, and past budgets, spending reports, taxes, revenue, performance updates, and more. This type of financial transparency leaves little to the imagination by eliminating the question of how the budget is being spent, ultimately building much-needed trust between residents and community leaders.

Citizen-Driven

Take transparency a step further by allowing citizens to give input on how the budget should be allocated. This shows the community that the power to make changes is not just in the hands of local government officials, but in their hands as well. Participatory Budgeting is a practice used by several communities, where residents are given the power to directly decide how to spend a portion of the public budget. Greensboro, North Carolina, utilizes Participatory Budgeting to engage with residents who are 14 years of age and older by allowing them to submit ideas for projects and programs, and vote on which ones to fund. Since kicking off the participatory budgeting process in 2015, 73 projects have been approved by resident votes. Through this innovative budgeting process, residents are given a direct outlet to make a difference in their everyday lives by harnessing a decision-making power that they may have never experienced before.

Equitable

Taking a look at your budget through an equity lens can open your eyes to more positive outcomes for each member of your community. San Antonio, Texas, utilizes a specially curated Budget Equity Tool to weave racial and economic equity considerations into the city’s budget development process. This tool is designed as both a product and a process, which presents a set of questions to help guide city departments and offices on a path to assessing how their budgets can either benefit or burden each facet of the community, especially neighborhoods of color or low socioeconomic status. Applying such tools to the budgeting process can open your eyes to disparities between different parts of the community, which paints a clearer picture of exactly where each part of the budget is needed most.

Efficient

With budget cuts and economic downturns being a harsh reality for many communities, it is time to get creative with leaner funding. Going hand in hand with both equitable and citizen-driven budgeting practices is efficiently handling a slimmer budget. When the city of Sefton, in Merseyside, England, cut its $300,000 annual budget for its community meals program, Peter Moore, the head of the social services department, took it upon himself to reach out to those individuals who received community meal deliveries in order to determine what their broader needs were. By involving the residents who received these meals in the conversation, the overwhelming response was that many did not actually like the meals that they were receiving, but they mostly enjoyed the human contact they experienced through the meal program. To address both the loneliness and meal issues, Moore got crafty and ignited partnerships with a volunteer organization called Age Concern as well as local food businesses. Age Concern helped connect individuals with city cycling groups, walking groups, social services, and money management to help them deal with their loneliness issues. To address the lack of meal funding, 40 different local food businesses banded together to offer hot meals to residents at no cost to the city. This also gave residents more variety in meals offered, which solved the issue of them not liking the previous meals offered. Getting creative by involving residents in tough decisions regarding budget cuts not only gives them ownership of how leaner budgets should be allocated, but can open the door to better and more inexpensive ways to address their needs in the first place.

Recovery-Focused

Communities around the world have shared unprecedented crisis that has flipped just about everything on its head for the past two years. Utilizing your budget to help stimulate economic recovery will collectively promote healing throughout your community. Bessemer, Michigan, is allocating a portion of its budget to stimulate the local small business economy through the City of Bessemer Pop-Up Shop Program. This program acts as a launchpad for new, local entrepreneurs by giving them the opportunity to get their business off the ground with the help of up to three months of free rental assistance (up to $500 per month), followed by up to six months of 50 percent rental assistance on locations within most of the commercial areas in Bessemer. Utilizing your budget to prioritize similar initiatives that promote the health of the local economy and the entrepreneurs that fuel it, will ensure that local businesses and the residents that love them will weather any storm.

Blaze a Path Forward

While making financial decisions can be challenging, employing principles of transparency, participation, equity, efficiency, and recovery to the budgeting process helps paint a much clearer picture of what your community can look like. For more ways to revitalize your community through the budgeting process, refer to ICMA’s array of finance and budgeting resources.