Massachusetts Public Library Trustees Handbook

Budget Preparation
	Chapter 7. Budgeting and Financial Management

Budget Preparation

Generally, the library director is responsible for the preparation of the budget request. The board of trustees is responsible for final approval and adoption of the proposed budget. The budget is the financial expression of the library's objectives, and as such, should mirror the priorities of the library community. As with other areas of library planning and policy making, the budget preparation is a cooperative process involving trustees, library director, library staff and municipal officials.

Budgeting is a continuous process. The library director and trustee finance committee should evaluate the budget and expenditures throughout the year. Is the budget on target for meeting expenditures? Are revenue sources providing income as expected? With the variety of local, state, and federal funding sources, differing fiscal deadlines, and the need to educate decision makers about these varying factors, it is always budget time.

There are two kinds of budgets: line item budgets and program budgets. A line item budget shows a different account number for each type of overall expenditure. Expenditure categories typically include:

Personnel: salaries and benefits
Library materials: materials that the patrons can use or borrow, such as books and videos
Operations: maintenance of the building, utilities, and supplies.

A program budget assigns a budgetary value to each major program category such as reference services, children's programs, or literacy outreach. The budget for each program item captures all the line item expenses that go into providing that particular service.

The library should develop both line item and program budgets, and integrate them into one document. Responsible resource management is made easier with this double entry system.

Ask your library director to contact your regional library system for sample budgets.

Role of the library director and trustee finance committee:

Develop budget calendar with key dates for completion, definition of tasks and assignment of responsibility (3 to 6 months before fiscal year begins)
Review the library's long range plans
Evaluate the prior year's actual line or program costs
Conduct preliminary discussions with trustees, key library staff, and municipal officials regarding anticipated expenditures
Make preliminary decisions about library priorities based on the library plan. Project anticipated library revenues.

Role of the library director and staff:

Develop a draft budget, including program and/or line item analysis defining services, anticipated revenues and expenditures.

Role of the trustee finance committee:

Analyze the budget draft
Present budget draft to full board. The finance committee studies, scrutinizes, and proposes amendments if necessary. The full board adopts final budget.


Chapter 7. Budgeting and Financial Management		Presenting the Budget