Reviewed Date: 12/06/2022
The most important step of the budget process follows adoption: monitoring revenues and expenditures for the budget year. A few basic practices will help you adequately monitor the income and expenditures of your city.
First, devise a monthly report in order to give elected officials and department heads a current picture of the city’s finances.
Second, during the course of the fiscal year, prepare a quarterly or mid-year budget review. This will help with the third most important aspect of the monitoring process: budget amendments. Even the best budget will miss a line item. T.C.A. § 6-56-209 allows the governing body to authorize the budget officer to transfer a limited amount of funds set by the governing body from one appropriation to another within the same fund. Any transfers shall be reported to the governing body at the next reular meeting and shall be recorded in the the minutes. The law also allows for amendments to the budget in order to bring actual expenditures in line with the budget when transfers may fall short. The budget ordinance may be amended “in the same manner as any other ordinance may be amended.” T.C.A. § 6-56-208. A public hearing is not required for a budget amendment.
It is impossible to overemphasize the need for budget monitoring. Without it, the budget process is incomplete and may place the city in a tenuous financial position.