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How to Select the Best Budgeting Software Solution for Local Government

| January 5, 2023 | By

Local government budgets allocate funds for a broad range of community services, from repairing potholes to addressing public health crises. But without effective budgeting software, many funding decisions about these essential programs and services are made in a vacuum.

Government budgeting software gives decision makers a more holistic view of where funds are allocated, how programs align with community needs, and how changes to one program can impact another.

This is a departure from the traditional approach to government budgeting that primarily focuses on line items at the departmental level. These line-item budgets limit visibility into where funds are going and whether they are impacting the right programs and services


Priority-based budgeting takes line-item and programmatic budgeting to the next level.

When used in concert, line-item, programmatic, and priority-based budgeting provide a high level of transparency into the what, why, and how of a local government budget. Together, they: 

Provide context.

Looking at programs rather than line items creates a greater understanding of what specific services do for the community.

Show the true cost of programs.

The allocation of line items to programs provides insight into what resources are needed for each program and how much those resources cost.

Communicate data-driven decisions.

Priority-based budgeting takes the guesswork out of how and why funds are allocated to a specific program or service.

Demonstrate alignment with goals.

Instead of basing new budgets on the previous year’s budget, priority-based budgeting builds accountability with annual evaluations that ensure programs align with community priorities.


What features should you look for in software solutions for local governments?

There are many budgeting software solutions for local governments, but they are not all designed to support priority-based budgeting. 

To ensure you select the right budgeting software, let’s look at the must-have feature sets in the context of the priority-based budgeting capability they support. 

Download the 2022 Annual Impact Report to explore the future of government  budgeting. >>>

Program Inventory

Creating a program inventory helps budgeting teams maximize transparency by clearly communicating what each program does. This helps decision makers understand the true cost of doing business and reduce redundancy by allocating line-item personnel, non-personnel, and revenue to programs instead of departments. 

Program inventories also align resources with changing community priorities. Each service is evaluated annually so funds can be allocated appropriately.

Software features that support program inventory capabilities:

Look for software that provides starter inventory recommendations based on previous local government inventories. This will help you build out the best list of programs for your department, without starting from square one.


Cost Allocation

In priority-based budgeting, cost allocation is the bridge that takes line items and makes them relevant to leadership and decision makers. By providing actual data about how much it costs to run a program and how many people and departments contribute to that program, you can identify cost savings and reduce redundancies.

This data can also be applied to budget requests to show department heads how approving funds for one program will impact another. 

Software features that support cost allocation capabilities:

Agility is key when it comes to using software to visualize your cost allocation options. 

Look for a solution that allows you to:

  • Switch from a line-item view to program view to immediately understand department line-item allocation to programs.
  • Drill down into each program to see exactly who and what contributes to the cost of the services you provide.
  • Apply filters to view program data by department, division, funds, position name, and more.



Scoring is the process that allows budget teams to compare programs to priorities and determine overall alignment and alignment to specific areas, such as infrastructure or fiscal stewardship.

Aligning scores to specific areas also helps separate internally facing and externally facing programs so you aren’t scoring public safety programs against employee recruitment initiatives, for example. 

Software features that support scoring capabilities:

Peer review tools allow you to input feedback from department leaders, executive sponsors, elected officials, and even community members, and then validate the scores.

Your software should also be able to assign data points to each program so decision makers have a full data package to refer to during budget deliberations.



Program insights lead to outcomes and actions that inform and instruct where budgets could or should go. Insights provide the opportunity to review where services could be provided in new and alternative ways and inspire innovation at all levels within the organization.

Software features that support program insight capabilities:

Look for a budgeting solution that includes a repository where you can store innovative ideas throughout the year to improve your organization or achieve a specific outcome.

Draw on these ideas for opportunities to reallocate resources or generate new revenue, and ensure alignment with community priorities by encouraging social contribution through voting and comments.



ResourceX Helps Local Governments Launch Their Priority-Based Budgeting Initiatives

Not all budgeting software is a good fit for the specific needs of local and state governments—especially those looking to make priority-based budgeting part of their process. 

ResourceX is a top choice for government organizations that want to look beyond the line item to create budgets that align with programs and larger outcomes, like climate, equity, and resilience.

Download the 2022 ResourceX Annual Impact Report to learn how we help communities drive real change, one priority-based budget at a time. 

Discover how organizations of all sizes benefit from priority-based budgeting