Milpitas, CA, Moves to Strategic Budgeting

From Incremental to Strategic Budgeting in Three Steps

Coming into his new role, Walter Rossmann knew there was a better way to work. His first action as Deputy Finance Director was to buy a new budget system for the City through a competitive procurement process.

Recognizing that without changes to the way the budget was developed the City could not find the savings it needed, Rossmann worked with the City Manager’s office, department directors and budget liaisons to gain buy-in across teams to transition to a strategic budget process that allowed for greater efficiency and scenario planning:

The budget team uploaded the previous year’s budget for each department to establish Council-approved service level costs and provide teams with a base budget in OpenGov.
With access to scenario planning capabilities via OpenGov, the budget team easily ran multiple scenarios with available data to prepare for the potential impact in revenue shortfalls due to the impact of the COVID-19 pandemic. Enabling teams to be agile helped them prepare for uncertainty with confidence.
After the base budget was established, departments submitted service level changes for finance review and the City Manager’s consideration.

Key Results for the City of Milpitas

This newfound clarity provided Milpitas with the confidence it needed to reduce expenditures as part of the base budget process, resulting in savings of more than $4 million over two budget cycles (1% of the annual base budget). Strategic budgeting saved jobs too; the new approach provided a way for the City of Milpitas to bridge revenue shortfalls and avoid critical service and position cuts. The City also saved over 100 hours in staff time, which allowed them time to develop a more accurate and refined forecast of expenditures and revenues.

With enhanced content that provided detailed descriptions of proposed service level changes, including information of the impact to performance and a no-funding decision, questions from the Council and the public were proactively addressed. The City also published its transparency portal to share key budget details with the public in an interactive online site.

“By showing only relevant updates to the budget to Council and sharing our analysis proactively, we reduced the usual two hour session to a two question discussion,” described Rossmann, who was recently promoted for his leadership in steering the City’s finances and improving public engagement and transparency.

“OpenGov’s highly detailed trainings helped ensure that everyone was ready to make the change to a strategic budget process and fully utilize OpenGov’s powerful capabilities.”
Walter Rossmann, Deputy City Manager, City of Milpitas, CA

Showing and Sharing Their Work

This renewed focus on transparency and public information was amplified by the COVID-19 pandemic. The importance of disseminating information and engaging citizens prompted Milpitas to expand its use of OpenGov’s Open Town Hall software, where they’ve been hosting a variety of virtual meetings, in addition to gathering virtual survey feedback on strategic priorities from the public, often in multiple languages. For example, Milpitas also used Open Town Hall to source ideas from the community when recruiting a new chief of police.

Milpitas’ experiment in innovative leadership to meet urgent needs has paid off for the City both in terms of budgeting performance and community engagement. The City’s story offers a playbook for using challenging times to create opportunities for positive change, both in terms of strategic budgeting and with community engagement.

About Milpitas, CA

Located at the southern tip of the San Francisco Bay, the City of Milpitas is a progressive community that is an integral part of the high tech Silicon Valley. With a very diversified resident population of 70,817, Milpitas features quality schools, conveniently located neighborhood parks and shopping centers. The City is rich in diversity.