Rethinking Budgeting: Why Civic Engagement is the Future of Public Finance

by Polco Product Team on May 30, 2025

Polco's Rethinking Budgeting - the future of public finance

For decades, local governments have relied on incremental budgeting—adjusting last year’s numbers with modest tweaks. While this method offers familiarity, it often fails to address evolving community needs, strategic goals, and the demand for transparency. Recognizing these shortcomings, the Government Finance Officers Association (GFOA) launched the Rethinking Budgeting initiative, advocating for a transformative approach that emphasizes strategic alignment, flexibility, and public engagement.

The Shift Toward Strategic, Participatory Budgeting

GFOA's Rethinking Budgeting framework encourages local governments to:

Move beyond incrementalism:
Transition from merely adjusting past budgets to making decisions based on current data and future goals.

Focus on strategic priorities:
Allocate resources to areas that align with long-term community objectives.

Enhance decision-making:
Incorporate data-driven insights to reduce bias and improve transparency.

Eliminate budgeting games:
Foster collaboration over competition among departments.

This paradigm shift is not just about numbers; it's about transforming budgeting into a tool for community engagement and trust-building.

Polco’s Role in Advancing Rethinking Budgeting

Polco, in collaboration with Envisio, and Questica, co-authored the white paper A Roadmap for Real Collaboration in Budgeting. This guide offers a comprehensive approach to modernizing budgeting processes, emphasizing the integration of technology and community input.

Polco's suite of tools supports this modern budgeting approach:

Budget Simulation:
Allows residents to explore budget trade-offs, fostering a deeper understanding of fiscal decisions.

Taxpayer Receipt:
Provides individuals with a breakdown of how their tax dollars are allocated, enhancing transparency.

Prioritize:
Enables communities to rank services and initiatives, ensuring that budgeting aligns with public priorities.

Track Module:
Offers performance measurement systems to monitor progress toward strategic goals.

Real-World Impact: Building Trust Through Engagement

Communities implementing these tools have reported increased public trust and more informed decision-making. For instance, by involving residents in budget simulations, local governments have demystified the budgeting process, leading to more constructive public discourse and stronger alignment between community needs and fiscal policies.

Embracing the Future of Public Finance

The call to rethink budgeting is more than a procedural change; it's a commitment to transparency, strategic planning, and genuine community engagement. By adopting these principles and leveraging tools like those offered by Polco, local governments can transform budgeting from a routine task into a dynamic process that truly reflects and serves their communities.