Trachtenberg School of Public Policy and Public Administration PPPA 6005 Public Budgeting, Revenue and Expenditure Analysis Spring 2016 Jason Juffras

Transcription

1 Trachtenberg School of Public Policy and Public Administration PPPA 6005 Public Budgeting, Revenue and Expenditure Analysis Spring 2016 Jason Juffras Class Meeting: Section 10 Corcoran 106 Wednesday 6:10 to 8:30 p.m. Course Objectives Funding for public programs is inseparable from the operation of those programs. All public managers therefore find themselves needing knowledge and skills in the principles of public finance and budgeting (as do those working in government consulting, non-profit policy advocacy, and other private-sector positions with a public policy focus). Whether you are an official who is immersed in public budgeting on a day-to-day basis, or you must make policy based on the relationship between dollars and program goals and objectives, an understanding of these concepts is vital to both your personal success and the success of your organization. This course will survey two broad areas of finance and budgeting in the public sector: (1) budgeting and public expenditure, and (2) revenue analysis and management. At the conclusion of the course, students should have a generalist's familiarity with each of these two key areas of governmental finance. In addition, students should become familiar with a variety of basic analytical techniques appropriate for the analysis of revenue, spending and debt issuance. It is also an important objective of this class that students continue to develop their ability to read quickly, analyze issues carefully and critically, and communicate effectively, particularly by developing their skills in professional writing. Required Text (available at Bookstore) Robert D. Lee, Ronald Johnson, and Philip Joyce, Public Budgeting Systems, 9th Edition (Jones and Bartlett Publishers, 2013). Other assigned readings are posted on Blackboard.

2 Course Requirements The factors that determine a student s final grade are listed below. Specific instructions for the assignments will be passed out at a later time in advance of the assignment due date. Day Care Budget Preparation Exercise 25% Mid-Term Examination 25% Final Examination (budget simulation) 35% Class Participation and Presentation 15% All assignments and the final examination will be take-home, and must be done by students working alone. The due dates are listed in the course schedule shown below. Unless an exception is made by the instructor, late work will be penalized with a one grade step reduction (e.g. from an A- to a B+) per day. Incompletes will be dealt with consistent with school policies. Please note that this syllabus is intended as a guide to the course for the student. Sound educational practice requires flexibility and the instructor may, with appropriate notice, change content and requirements at any time during the semester. Class Schedule at a Glance 1. January 13 th Introduction and the Public Sector in Perspective 2. January 20 th Government, the Economy, and Economic Development 3. January 27 th Budget Cycles and Budget Preparation Guest Speaker: John Hill, Chief Financial Officer, City of Detroit Day-Care Budget Exercise Available on Thursday, January 28 th 4. February 3 rd Cost Analysis Day-Care Budget Exercise Due on Tuesday, February 9 th, at midnight 5. February 10 th Budget Approval Guest Speaker: Pete Fontaine, former Assistant Director for Budget Analysis, Congressional Budget Office 6. February 17 th Federal Budget Process 7. February 24 th Budget Reforms Take-Home Mid-Term Exam Available on Thursday, February 25 th 2

3 Class Schedule at a Glance (continued) 8. March 2 nd Budget Execution and Fiscal Discipline Take-Home Mid-Term Exam Due on Wednesday, March 2 nd, at 5 pm 9. March 9 th Capital Budgeting, Debt and Cash Management 10. March 23 rd Financial Management NO CLASS MARCH 16 th SPRING BREAK 11. March 30 th Introduction to Tax and Revenue Guest Speaker: Norton Francis, Senior Research Associate, Urban/Brookings Tax Policy Center 12. April 6 th Income and Payroll Taxes 13. April 13 th Property and Sales Taxes California Budget Challenge Available on Thursday, April 14 th 14. April 20 th Fiscal Federalism and Course Wrap-Up Take-Home Final Exam (based on California Budget Challenge)-Due on Friday, April 29 th by 5 pm 3

4 Course Outline and Reading List The outline lists topics and reading assignments by course session. Reading assignments include the text (Lee, Johnson and Joyce), and readings posted on Blackboard. Week 1. Introduction and the Public Sector in Perspective (January 13 th ) Lee, Johnson, and Joyce, Chapters 1 and 2 V.O. Key, The Lack of a Budgetary Theory, American Political Science Review, December Week 2. Government, the Economy, and Economic Development (January 20 th ) Lee, Johnson, and Joyce, Chapter 3, pp , Merl Hackbart and James Ramsey, The Theory of the Public Sector Budget: An Economic Perspective, in Budget Theory in the Public Sector, Aman Khan and W. Bartley Hildreth, editors. Quorum Books, Chris Edwards and Tad DeHaven, Corporate Welfare Spending vs. the Entrepreneurial Economy, testimony before the U.S. House of Representatives Committee on the Budget, June 1, Ed Harris and Frank Sammartino, Trends in the Distribution of Household Income, , presentation to the NBER Conference on Research in Income and Wealth, August 6, Douglas Elmendorf, Designing Federal Budget Policy to Spur Economic Growth, speech to the National Association for Business Economics, October 13, Week 3. Budget Cycles and Budget Preparation (January 27 th ) Lee, Johnson, and Joyce, Chapter 4 (entire) and Chapter 8, pp , , and David Primo, The Uses and Misuses of Budget Data. The Mercatus Center at George Mason University, Elizabeth McNichol and Dylan Grundman, The Current Services Baseline: A Tool for Understanding Budget Choices. Center on Budget and Policy Priorities, October 21, President Barack Obama, The Budget Message of the President, February 2, Read one of the following: U.S. Department of Homeland Security, Fact Sheet: Department of Homeland Security Fiscal Year 2016 Budget, U.S. Department of Labor, FY 2016 Budget Fact Sheet, U.S. Department of State, Department of State and U.S. Agency for International Development 2016 Budget: Fact Sheet, or U.S. Department of Veterans Affairs, FY 2016 Budget Fact Sheet. 4

5 Week 4. Cost Analysis (February 3 rd ) Steven Finkler, Understanding Costs, excerpt from Chapter 4 of Financial Management for Public, Health, and Not-for-Profit Organizations. Pearson, Congressional Budget Office, The Budget Outlook: 2016 to January Read Summary and Chapter 1 on the budget outlook. (Note: this is a read-ahead for Week 5. Please take advantage of the light reading load for this week to gain ground for the next week). Week 5. Budget Approval (February 10 th ) Lee, Johnson, and Joyce, Chapter 9 Elizabeth McNichol, Iris Lav, and Kathleen Masterson, Better Cost Estimates: Better Budgets: Improved Fiscal Notes Would Help States Make More Informed Decisions. Center for Budget and Policy Priorities, November 24, Michael Neibauer, Norton on How Getting A Little Pregnant Saved DHS Consolidation at St. E s, Washington Business Journal, December 29, Chris Edwards, Special-Interest Spending, The Cato Institute, April Ronald Utt, The Bridge to Nowhere: A National Embarrassment. Heritage Foundation WebMemo #889, October 20, Week 6. Federal Budget Process (February 17 th ) Lee, Johnson, and Joyce, Chapter 10 Center on Budget and Policy Priorities, Policy Basics: Introduction to the Federal Budget Process. April 20, Scott Lilly and Eleanor Hill. Broken Budgeting: A View of Federal Budget Making from the Trenches. Center for American Progress, August Pete Domenici and Alice Rivlin, The Congressional Budget Process Is Broken, Drastic Makeover Needed. The Brookings Institution, July 27, Molly Reynolds, Five Things to Know About the Budget Deal. The Brookings Institution, October 28, Peter G. Peterson Foundation, Key Drivers of the Debt, December Peter G. Peterson Foundation, Spending. (undated) 5

6 Week 7. Budget Reforms (February 24 th ) Lee, Johnson, and Joyce, Chapter 7 Alice Rivlin, Biennial Budgeting: A First Step Toward Budget Process Reform, testimony before the U.S. House of Representatives Committee on the Budget, November 18, Ronald Snell, Zero-Based Budgeting in the States. National Conference of State Legislatures, January U.S. Office of Management and Budget, Delivering a High-Performance Government. January U.S. Department of Labor, Summary of Performance and Financial Information: Fiscal Year or U.S. Department of State and U.S. Agency for International Development, FY 2014 Joint Summary of Performance and Financial Information. Week 8. Budget Execution and Fiscal Discipline (March 2 nd ) Lee, Johnson, and Joyce, Chapter 11, pp National Conference of State Legislatures, Fiscal Brief: State Balanced Budget Provisions. October Donald Boyd, Stop Us Before We Tax Again. Nelson A. Rockefeller Institute of Government, February 8, Elizabeth McNichol and Kwame Boadi, Why and How States Should Strengthen Their Rainy Day Funds. Center on Budget and Policy Priorities, February 3, Center on Budget and Policy Priorities, Policy Basics: Supermajority Rules to Raise Revenues. February 11, Week 9. Capital Budgeting, Debt, and Cash Management (March 9 th ) Lee, Johnson, and Joyce, Chapters 13 and 14 Congressional Budget Office, Federal Investment Week 10. Financial Management (March 23 rd ) Lee, Johnson, and Joyce, Chapter 12 (entire) and Chapter 8, pp U.S. Department of the Treasury, A Citizen s Guide to the Fiscal Year 2014 Financial Report of the United States Government

7 Iris Lav and Elizabeth McNichol, Misunderstandings Regarding State Debt, Pensions, and Retiree Health Costs Create Unnecessary Alarm. Center for Budget and Policy Priorities, January 20, Pew Charitable Trusts, The State Pensions Funding Gap: Challenges Persist. July Week 11. Introduction to Tax and Revenue (March 30 th ) Lee, Johnson, and Joyce, Chapter 5, pp , Chapter 8, pp , and Chapter 11, pp William Gale and Aaron Krupkin, Major Tax Issues in Budgeting for National Priorities Project at The Brookings Institution, undated. Robert Pear and Jackie Calmes, A Little Something for Everyone. The New York Times, December 16, Michael Greenstone and Adam Looney, Just How Progressive Is the U.S. Tax Code? The Hamilton Project, April 13, Peter G. Peterson Foundation, How Much Do Americans Pay in Taxes? April 15, Peter G. Peterson Foundation, Tax Primer. September 26, Week 12. Income and Payroll Taxes (April 6 th ) Lee, Johnson, and Joyce, Chapter 5, pp Congressional Budget Office, The Distribution of Income and Federal Taxes, November Congressional Budget Office, The Distribution of Major Tax Expenditures in the Individual Income Tax System. May William Gale, Aaron Krupkin, and Kim Reuben, The Growth Mirage: State Tax Cuts Do Not Automatically Lead to Economic Growth. Urban-Brookings Tax Policy Center, September 8, Center on Budget and Policy Priorities, Policy Basics: Federal Payroll Taxes. April 2, Week 13. Property and Sales Taxes (April 13 th ) Lee, Johnson, and Joyce, Chapter 5, pp , and Chapter 6 (entire) Leonard Burman, The Tax Reform That Just Won t Die (and Shouldn t). The Milken Institute Review,

8 Kevin DeGood and Michael Madowitz, Switching from a Gas Tax to a Mileage-Based User Fee. Center for American Progress, July Gilbert Metcalf, A Green Employment Tax Swap: Using a Carbon Tax to Finance Payroll Tax Relief. The Brookings Institution and World Resources Institute, June Week 14. Fiscal Federalism and Course Wrap-Up (April 20 th ) Lee, Johnson, and Joyce, Chapter 15 Wallace Oates, An Economic Approach to Federalism, Chapter 1 of Fiscal Federalism, by Wallace Oates. Harcourt Jovanovich, Congressional Budget Office, Federal Grants to State and Local Governments. March Kevin DeGood, Northern Beltline, Birmingham, Alabama: White Elephant Watch, Volume 4. Center for American Progress, December Chris Edwards, The Federal Emergency Management Agency: Floods, Failures, and Federalism. Cato Institute, November 18,

9 Policies Governing Trachtenberg School Courses 1. Blackboard: Blackboard will be used to communicate with students. Please make sure that you can access the course on Blackboard and that you regularly check whatever account Blackboard uses for you. If you have problems with Blackboard, contact the Helpdesk at or helpdesk.gwu.edu. 2. Attendance: Please try not to miss class! The concepts of budgeting build on one another and are closely related. If you do miss a class, please make sure you get notes from a classmate and download assigned materials from Blackboard. 3. Turning in Assignments: Assignments can be submitted electronically through Blackboard. 4. Late Work: Unless an exception is made by the instructor, late work will be penalized with a one grade step reduction (e.g. from an A- to a B+) per day. 5. Laptops: You are welcome to use a laptop to take notes. Please refrain from checking and surfing the web during class. It is extraordinarily distracting to people sitting behind you, and to the instructor! 6. Collaboration: All assignments must be completed by students working on their own. 7. Academic Honesty: All exams, papers, and other graded work products and assignments must be completed in conformity with the George Washington University Code of Academic Integrity (see Please note the prohibition on consulting former students or relying on prior answer keys when completing problem sets or take-home exams. 8. Incompletes: A student must consult with the instructor to obtain an incomplete before the last day of class. The student and instructor will sign the Columbian College of Arts and Sciences (CCAS) contract for incompletes and submit it to the School Director. Consult the TSPPPA Student Handbook for the relevant CCAS policy. 9. Grades: No grade changes can be made after the conclusion of semester, except for clerical error. 10. Accommodations for Students with Disabilities: In order to receive accommodations on the basis of disability, a student must give notice and provide proper documentation to the Office of Disability Support Services, Marvin Center 436, Accommodations will be made based on the recommendations of the DSS Office. ( 11. University Student-Support Resources: Help in addressing academic, social, and personal issues is available 24 hours a day, 7 days a week through the University Counseling Service, which can be reached at ( 9

10 Grading Standards A Excellent: Exceptional work for a graduate student. Work at this level is unusually thorough, well-reasoned, creative, methodologically sophisticated, and well-written. Work is of exceptional, professional quality. A- Very Good: Very strong work for a graduate student. Shows signs of creativity and a strong understanding of appropriate analytical approaches, is thorough and well-reasoned, and meets professional standards. B+ Good: Sound work for a graduate student; well-reasoned and thorough, without serious analytical shortcomings. This grade indicates the student has fully accomplished the basic objectives of this graduate course. B Adequate: Competent work for a graduate student with some evident weaknesses. Demonstrates competency in the key course objectives but the understanding or application of some important issues is less than complete. B- Borderline: Weak work for a graduate student but meets minimal expectations in the course. Understanding of key issues is incomplete. (A "B-" average in all courses is not sufficient to sustain graduate status in good standing. ) C+/ C / C- Deficient: Inadequate work for a graduate student; rarely meets minimal expectations for the course. Work is poorly developed or flawed by numerous errors and misunderstandings of important issues. F Unacceptable: Work fails to meet minimal expectations or course credit for a graduate student. Performance has consistently failed to meet minimum course requirements. Weaknesses and limitations are pervasive. 10