TheReview_Jan_Feb_2022 Flipping Book

INSIGHT INTO Municipal Finance

FOR THE NON-FINANCE OFFICIAL

By Anthony Minghine

Y ou have been elected to serve in your community. Congratulations! Now you find yourself on the governing body or maybe the chief elected official of a multifaceted, multimillion-dollar organization. Even if you are accustomed to corporate accounting in a business setting, those are not the same rules that are used in governmental accounting and budgeting. Trying to sort this all out in a magazine article can be difficult, but we will try and give you a foundation to build on. Your best resources are the management, finance, and audit professionals in your local government . They will have the best understanding of your particular circumstance. What follows won’t make you a municipal finance expert, but it will give you some insight into the types of issues you will be faced with in your role.

Success is Different than in a Business First off, understand the business of the city or village. A municipality is a nonprofit service-based industry, and profit-based manufacturing techniques rarely apply. Success or failure of a program won’t be measured in income or return on investment, but more likely on service levels or residents served. Running government like a business may be a great catch phrase, but it can be a formula for disaster if you misapply that mindset. Looking for efficiencies like a business is appropriate; using income as a service evaluator typically is not.

30 THE REVIEW

JANUARY / FEBRUARY 2022