Down The Sewer Pipe – Politically Speaking

After you have been in office a while your staff, or your treasurer will let you know that it is time to begin considering the budget your municipally, state, county, or Homeowners Association functions under. You will learn what the revenue streams are, what the expenses are, which projects take the biggest number of resources to do, and how the monetary system for your area functions. Not unusual for a city to be required to put a monthly bond payment in an account that can’t be touched. Making the bond payment of, say, twenty thousand dollars per month, and at the same time putting the same amount in an account that is inaccessible is quite common.

But that brings to the fore just what a budget is. A budget is a plan on how public money, regardless of source, is to be spent. A budget is not money. This surprises a lot of people. I have lost count of how many times I have had to explain that a budget is a spending program. It will list the income source, the expectation of revenue for the coming year, and the expenses that the income is to be spent on. However, just because a hundred thousand dollars is budgeted for road repair doesn’t mean that you can spend that amount of money to actually repair the road.

In order to make the road repair your town, city, county, state, Homeowners Association needs to have that amount of money in their checking account. Otherwise, you will spend money that you do not have to make the repair, or your treasurer will have to rob another account, say building maintenance, to ensure that checks drawn on the entity’s checking account don’t bounce.

The basic difference between money and a budget, is that a budget is what will be done with money, once money is received.