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Open Budget, Open Process: A Short History of Participatory Budgeting in the US

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A simple twist on the traditional budgeting process has us paying attention to payoffs for transparency. Participatory budgeting (PB) is a political process that lets members of a community vote on how certain budget funds should be allocated. By including the public in decision-making, PB has the potential to be an agent of accountability, helping to demystify city budgets, to turn voters into active contributors and informed monitors of government progress, and to support efforts for proactive budget disclosure. As it stands today, PB helps communities explore many of these opportunities, and it serves as an important gateway to engagement with local government for a wide variety of residents, especially traditionally-underrepresented groups. It’s a transformative process -- one that may cost governments almost nothing, since it just reallocates existing funds -- and it's a process we’re eager to see explored in more detail as more and more communities hold a magnifying glass to budgetary data.

So how does it work?

Participatory budgeting has primarily been embraced by municipal governments. Each city has a slightly different process, but the basic timeline is the same. Residents are invited to neighborhood assemblies, where they discuss problems and possible solutions funded by the city's discretionary money. Budget delegates take those concerns and research them, identifying existing efforts and figuring out how each solution could actually be implemented. They come back with a slate of detailed project proposals that the citizens then vote on. The top projects are sent to the city council for approval, though this step is usually just a formality.

The process first sprang up in the Brazilian city of Porto Alegre in 1989, the first year of Brazilian democracy after years of military dictatorship. When the left-wing Workers’ Party won power, they started PB in response to community organizations' demands for greater inclusion in financial decision-making. The Porto Alegre PB began modestly, with less than 1,000 voters in the first year, though it quickly grew to 40,000 within a decade. Other cities around the world took notice of Porto Alegre's success with PB: Though its strongholds remain in Brazil, participatory budgeting can now be found globally, with about 1,500 municipalities recorded using it in 2012.

NYC-participatory-budgetingFrom what we can tell, PB made its way to the United States in 2009 by way of Chicago's 49th Ward. In response to community demand for increased access to information about city spending, Alderman Joe Moore decided to implement PB as part of an experiment. He set aside $1.3 million of his discretionary money to be decided by ward residents. The outpouring of residential interest (to the tune of 1,427 voters) inspired other cities to follow suit. Both San Francisco, California, and New York City, New York, have tried PB in a few districts, with funded projects including everything from streetlights to community gardens. Residents of Buffalo, New York, voted recently on how to spend the fines from environmental violations, their first foray into PB. And although St. Louis, Missouri, and Boston, Massachusetts, are exploring plans for citywide PB in the near future, they’ll be following in the footsteps of Vallejo, California. Responding to a disconnected public hungry for greater oversight, Vallejo implemented the first US citywide PB initiative in 2013 to help residents respond to and participate in the city’s regrowth post-bankruptcy. (So far, citizens and local transparency organizations seem pleased with the results.)

What is the impact?

PB can result in greater access to budget information and oversight and in greater restoration of important infrastructure projects - a sign of the process’s strength. A 2002 World Bank report on Porto Alegre studied what happens to the people who participate in PB. They found that PB helped empower citizens in four ways:

  • Information -- Participants learn about their communities in meetings where civic information is disclosed.

  • Inclusion/participation -- PB involves parts of the population that might not normally be included in this kind of decision-making. (This holds true in American cities, as we’ll discuss below.)

  • Accountability -- The administration has to share its financial position with the people, who monitor the status of work that they had voted on the year before.

  • Local organizational capacity -- The groups that form to help influence budget decisions remain a cooperative network long after the voting ends.

As for the claims about PB helping to foster citizen inclusion, initial results from New York City are promising. Across the board, underrepresented voters came out to the ballot box, according to an analysis of the participants in NYC's 2011-12 PB cycle by the Urban Justice Center and the PBNYC Research team. Of note among the report’s highlights is that a greater proportion of minorities and women voted for the PB process than in previous, standard local elections. Advocates speculate that PB connects with residents because it has a direct, tangible impact on improving their neighborhoods. Whatever the reason, its impact is clear: people who have historically been underrepresented in politics in general are open to exploring this new avenue of engagement with their local government.

There are some caveats, of course. Critics complain that participatory budgeting takes a lot of planning and effort for just a minuscule portion of the budget: The $5.6 million that PB voters were working with in NYC for 2011-12 represented less than 0.01 percent of the city's operating budget. And it requires concentrated effort to reach a diverse group of voters. Traditional strategies work, like phone banking, flyering, and canvassing, but these take time, and planners have additional challenges on their hands, like thinking through the details of structuring and scheduling relevant meetings. Holding PB prep meetings late at night excludes youth and seniors. To maximize accessibility, organizers need to consider options like serving food, providing childcare, and holding meetings in locations accessible by public transport. When Chicago failed to take some of these into consideration for their PB process, they found to their dismay that the participants leaned even more heavily white, educated, and middle-upper class than the voters in their normal elections.

But these difficulties are part and parcel of any democratic undertaking, and they don't diminish PB's impact. Many cities recognize the potential participatory budgeting has for building trust in in public finance -- which is why they invariably choose to continue the program after testing it out -- but we hope they’ll also recognize the catalytic effect PB can have for opening local budget data and greater public inclusion throughout the budgeting process, too.

Alderman John Arena might have said it best when he talked about the decision to expand participatory budgeting in Chicago for the third year in a row: “PB has energized my community. The creativity and collaboration has been inspiring. But more than that it has provided insight to the taxpayer about the process, limitations and possibilities of municipal spending." Not bad at all for money that's already sitting in your city budget.

Photo by Flickr user neotint