Sources Used for Analysis
For the current analysis, information from official governmental sources related to Montgomery County, MD’s budget planning is used. The department in the local government used for the evaluation is the Health and Human Services department. The selection of the agency focusing on public healthcare and social services is determined by their importance in the community’s life. The department works on various programs related to the well-being of all members of society, placing special emphasis on disadvantaged groups (Montgomery, MD, 1).
Therefore, this paper focuses on the Emergency Homeless Shelter program administered by the Department of Health and Human Services. It states that the budget planning and financial distribution in the program Emergency Homeless Shelter are adequate, as they allow the department to help vulnerable people. However, it still has some areas for improvement.
Financial Plan
The program to establish emergency shelters for homeless populations was coordinated by two government agencies, the Department of General Services and the Department of Health and Human Services. The budget plan for the program led by Montgomery County, MD, focusing on emergency homeless shelters, was finished and published in Spring 2022 (1). The total expenditures and funding for the project were $17.1M. The total expenses and financing during the six years were $0.12M (Montgomery, MD, 1).
The peculiar detail was that in 2022, the source of financing changed from G.O. Bonds to CDBG (Montgomery, MD, 1). As a result, that financial year was marked by the appropriation of the bond supplemental for $2,455,000 (Montgomery, MD, 1). The plan was supposed to focus on the social factors society faced before that moment. The COVID-19 pandemic was among the events that shaped shelter budget planning. It allows for stating that the budget should have some flexibility to adapt to the emergency issues.
For the current population and projected future growth, the County’s facilities for providing homeless shelters and related services are inadequate. Additionally, the maximum population at each County homeless shelter has been reduced due to COVID-19 to accommodate social distancing. These reasons underscore the need for an improved financial plan to implement the initiative.
The project aims to purchase and renovate an existing building to accommodate medical offices, case management offices, meal service, and gathering spaces (Montgomery, MD, 1). Beginning in the spring of 2021, the Taft Court facility in Rockville, which now offers these services to men, will close (Montgomery, MD, 1). When the pandemic eases to the point where programming may resume, space in leisure facilities that were utilized to shelter females and males during the pandemic needs to be replaced (Montgomery, MD, 1). The establishment will ensure that Montgomery County’s homeless people who require emergency shelter have access to the full range of services.
There were two sources of finance in the discussed project. 32.2% of the funding derives from the Community Development Block Grant ($5.503), while 67.8% comes from G.O. Bonds ($11.599) (Montgomery, MD, 1). There are five significant categories of budget expenditures. Planning, Design, and Supervision requires $1,365 (Montgomery, MD, 1). Land costs $5,503, Site Improvements and Utilities are $0 in the report, and Construction is $10,184 (Montgomery, MD, 1). According to the website, total expenditures are $17,102 (Montgomery, MD, 1). $9,933 was spent in the first half of 2022, and $7,044 was spent during the year’s second half (Montgomery, MD, 1).
Even though the project is expected to receive funding for the next 6 years, no information is available yet because the term has not yet ended. The net impact of the program implementation is $23,515, and this amount is supposed to be divided equally over the next 6 years (Montgomery, MD, 1). Maintenance costs for all six years are $656; energy costs are $773; and other expenses are $22,086 (Montgomery, MD, 1). It states that the last component of this plan lacks detail and specification because the categories do not distribute the comparatively large sum of funds.
In general, the budget for creating emergency shelters for homeless individuals is sufficient and appears adequate to meet the needs of this disadvantaged population. The program’s financial plan covers six years, starting in 2022, which is appropriate for long-term planning for social services and healthcare expenses. As the final assessment of the budget planning shows, the cumulative appropriation for project implementation is $17,102, expenditures are $10,052, and the unencumbered balance is $7,050 (Montgomery, MD, 1). The primary concern in this case is categorizing the unencumbered balance, as budget planning requires more precision to effectively implement positive changes in the healthcare and social services sector.
Improvement
Although leaders cannot account for every possibility, they can anticipate some challenges that can alter their initial budget and prediction. Reviewing external market and financial trends that could hurt the project’s implementation is an excellent place to start. An ongoing prediction is helpful to keep track of any positive or negative changes that can seriously affect the endeavor (Raymond, 2). Rolling projections also let project managers adjust as needed in response to newly disclosed information, ensuring that decisions are made based on current events rather than past performance.
Forecasting is used to predict the program’s financial future. Before a department makes a business choice, forecasting helps to understand the implications of that action. The leaders’ ability to predict the company’s financial future will be compromised if they lack clarity about the enterprise’s overarching objectives (Omerov, 3). As a result, the department overseeing the project needs to have a clear grasp of what is influencing the forecasts; otherwise, they are only educated guesses unrelated to the objectives of the Health and Social Services department.
Budget Proposal
Reviewing external market and financial trends and predicting alternative scenarios for the budget proposal are the main recommendations to improve the budget proposal. The analysis and evaluation of the given budget indicate that the plan lacks alternative scenarios for events that may occur during the hosting of homeless populations at the emergency shelter. In addition, the budget plan lacks specifications for several vital aspects that should be present in this type of social and healthcare facility.
For instance, there are no descriptions of the funds allocated to medical personnel, counselors, and psychologists, without whom emergency centers for the homeless cannot function (Hao, 4). It is possible to add such categories to the budget planning: volunteer expenses, personnel expenses, and equipment costs. As the previous investigation shows, these three categories are not mentioned in the local Department of Health and Social Services’ initial report.
Federal, State, and Local Submission Process
The federal, state, and local budget submission processes have a common source of finances, which is citizens’ taxes, but they have specific differences. Funding for local government budgets, such as those of cities and counties, comes from property taxes and additional sales taxes. They can also be eligible for funding from the federal and state governments in some underprivileged regions (Henderson, 5).
Local tax revenues from sales and income taxation fund state governments’ budgets. Service taxes, import charges, and federal revenue taxes fund the federal government. Bonds may be sold by any of the three tiers of government to raise additional funds for the budget, although interest must be paid on those bonds.
The topic of a financial deficit, a situation in which budgetary expenses exceed expected revenue, distinguishes the federal budget from local and state budgets. A budget balance is required for both municipal and state governments. The federal government can take on debt to fund its operations and run a deficit. State and municipal governments have more options for raising funds than the federal government, which collects the most taxes.
The primary funding sources for the federal government are capital gains, income, and Social Security taxes (Ross, 6). Sales taxes, gasoline taxes, property taxes, and fees associated with specific licenses and permits are all collected both by state and municipal governments (Ross, 6). This information shows that the process of budget collection and submission has much in common with various levels of government. The difference is in the number of resources the officials use for financial planning.
Sources
- Montgomery MD. 2023. Emergency Homeless Shelter.
- Henry F. Raymond. 2022. Quantifying Homeless Populations. p. 544.
- Pernilla Omerov. 2020. Homeless Persons’ Experiences of Health- and Social Care: A Systematic Integrative Review. p. 1-11.
- Haijing Hao. 2022. The Determinants of Length of Homeless Shelter Stays: Evidence-Based Regression Analyses. p. 1-10.
- Morgan Henderson. 2022. Designing Optimal Recommended Budgeting Thresholds for a Medicaid Program. p. 342–347.
- Thomas K. Ross. 2020. Budgeting for Results. p. 24–34.