Multnomah County Auditor Releases Budget Process Audit: County needs better reporting on expenditures and more time for community involvement

October 2023 – Multnomah County: County needs better reporting on expenditures and more time for community involvement

Multnomah County develops its budget using a complex and time-consuming process, where departments create program offers – individual budgets for programs in their portfolio. The entire budget process takes about eight months. In fiscal year 2022, there were more than 600 program offers ranging from $20,000 to more than $436 million. The county meets Oregon budget law requirements by tracking and reporting on budgeted amounts compared to actual expenditures at the operating fund level by department.

Many components of the county’s budget process are consistent with best practices, but the county falls short of best practices in two important areas:

• Financial monitoring – the financial system is not set up to report budgeted compared to actual expenditures on a program offer basis. This means that the county does not publicly report how much it spends at the program offer level – the level at which the Board of County Commissioners makes budget decisions.
  
• Community engagement – the county has a multi-part approach to community engagement, but the complexity of the budget process and the short timeline available for community involvement limit the potential for impactful public engagement in the budget process.

Why we did this audit

We conducted this audit to assess if the county’s budgeting process is transparent and understandable for community members. Like other governments, Multnomah County allocates resources to programs and services that reflect its vision, strategies, and priorities through the budget process. This process is arguably among the most important things governments do.

What we recommend

• The central budget office and Chief Financial Officer should develop an ongoing process for all county departments to report to the Board of County Commissioners at least once each fiscal year to compare the adopted budget to actual expenditures at the program offer level.
  
• The Board of County Commissioners should develop a policy requiring departments to report to them when they intend to make expenditures in a way that that the Board defines as materially different than how they proposed to spend funds in program offers.
• The Chair should direct the central budget office and departments to engage community budget advisory committees earlier in the budget process so their comments have more time to be addressed before the release of the Chair’s proposed budget.
• The Board of County Commissioners should study whether the county should budget on an annual or biennial process and report on the results of this study.

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