IPN Proposal Scrutinized—

Mangiafico, Bienkowski Join Skeptics Of Zero-Based Budgeting For Newtown

By John Voket

In his private sector experience, Paul Mangiafico, a school board member and Republican candidate for Board of Selectman, has seen zero-based budgeting work extremely well. But when it comes to the practice that is being touted as the next best thing for Newtown’s municipal and school budgets by the same Independent Party of Newtown that endorsed Mr Mangiafico, the candidate said candidly that it may not be possible.

“We are not a zero-based budgeting government,” Mr Mangiafico said in a recent interview with The Newtown Bee. “It would probably destroy the structure of the budget. Psychologically, people can’t deal with zero-based budgeting if they aren’t working with it already.”

And even in the narrow scope where zero-based budgeting is being technically employed in the Newtown school district budget, in certain areas of staffing, Business Manager Ronald Bienkowski admits, the practice has its drawbacks.

“Zero-based budgeting works well in the private sector, but when you are in as controlled a financial situation as we are, there’s no sense in adding to the [transparency] with a zero-based strategy,” Mr Bienkowski said this week.

When even the prospect of balancing a checkbook can make a person’s eyes glaze over, ongoing discussions about zero-based budgeting are, for most, neither stimulating nor encouraged. But a committee of petitioning candidates, organized as the Independent Party of Newtown, came out of the gate early with a platform that, in part, called for zero-based budgeting to be instituted in Newtown’s municipal and school financial arenas.

Representatives of that political group have continued to suggest as much in a series of letters to the editor in recent weeks, which have brought out many critics of the accounting practice, and as many who, like Mr Mangiafico and Mr Bienkowski, are skeptical of its full-scale application in a fluid municipal government finance environment.

Among five IPN platforms issued September 8, number four reads: “Create a budget process that necessitates that a detailed justification of annual expenditures be provided for legislative and public review. Each of the town’s departments and the Board of Education will be required to submit an annual budget that does not simply renew or escalate the previous year’s expenditures; instead, each department budget will start at zero and each individual item to be included must be publicly justified each year.”

A Changing Position?

In recent days, however, there has been an apparent shift in the interpretation of IPN’s platform, its self-described “Declaration of Independents,” at least by one of its Legislative Council candidates.

In the space of a few weeks, IPN’s First District council challenger Albert Roznicki appears to have reversed his own position on the practice. In a letter to The Bee September 11, Mr Roznicki wrote: “The Independent Party of Newtown strongly recommends the implementation of a zero-based budget system. Financial planners start from a zero base and assume that no program is necessary, therefore no money need be spent. For a program to be accepted, it will have to be proven worthwhile and financially sound in an evaluation of all elements of revenue and spending. In zero budgeting, each program is examined in order to justify its existence, and is compared to alternative programs. Priorities are established and each cost center is challenged to prove its necessity.”

And in a letter Mr Roznicki sent to the newspaper October 17, he writes: “IPN’s overall objective relative to budgeting is to create a process that allows for the creation of a justified and transparent budget that the citizens of Newtown can understand, challenge, and can ultimately feel assured that their tax dollars are being spent as effectively and efficiently as possible. While ZBB [zero-based budgeting] is a common method to meet such an objective and some IPN members support some form of ZBB, IPN is open to review any alternative solutions that would meet its overall objective.”

Two Democratic candidates, Mr Roznicki’s District 1 challenger Christopher Lyddy and unopposed finance board incumbent James O. Gaston, who is also the Borough of Newtown’s top elected official, have repeatedly taken issue with the feasibility of the practice.

In a letter in this week’s edition, Mr Gaston writes, “Without any foundation, IPN stated no loss-of-services were anticipated, but the reality is clearly to the contrary. ZBB is heavy-handed and will cost our town and schools dearly, making them worse, not better.

“…it is clear that either IPN does not understand zero-based budgeting or they support massive cuts to town services and children’s education,” Mr Gaston continues. “Perhaps some in their group don’t understand while others want such destructive cuts.”

Mr Lyddy’s letter not only takes issue with the IPN’s position on the practice, it takes the petitioners to task for not identifying which of its members support that aspect of their platform, and questions why the IPN committee acknowledges such a system already exists at the school district while at the same time, calling for the district to institute the practice.

“What’s interesting is that if IPN truly believes that the school system is using ZBB then why are they proposing a new ZBB for the school system?” Mr Lyddy asks in his letter.

GOP Challenges Practice

Local Republicans have also weighed in on the matter, with First District council incumbent and finance subcommittee chairman Joseph DiCandido questioning whether or not the IPN can find any greater measure of savings by applying zero-based principles to proposed future school district projects as a practical exercise.

“I would challenge IPN to candidly discuss how they will pay for these projects with their zero-based budget,” Mr DiCandido said. “Given that built-in benefits and increases amount to 92 to 98 percent of this budget, you’re only looking at around $5 million to play with. With zero-based budgeting, a new high school would be mortgaged off to our children at the additional cost of millions, maybe tens of millions to Newtown taxpayers.”

The school business manager points out that while zero-based budgeting certainly creates volumes of paperwork and a substantially greater draw on personnel resources, the prospect of debating whether to prebuy 750 or 850 cases of copy paper and then holding meeting after meeting to determine how to apply any savings is not practical.

Mr Bienkowski also questioned how the district could quickly respond to imminent financial concerns if it was mired in a zero-based budgeting system.

“If a chimney is falling down, you have to fix it. You don’t have time to keep plugging things into decision packages,” the business director said, adding that the school budget is fluid and changes dramatically between its development and the end of each fiscal cycle.

“You go to the trouble to get to the bottom line, and by the end of the year it’s all misaligned,” Mr Bienkowski said. “How are you going to track that under zero-based budgeting?”