1. Week 2: Politics and Dynamics of Public Budgeting
• Budgeting: political or technical?
• The “baseline”
• Rubin’s model of budgetary decision making p.30
• Actors in the budget process
• Mini-case
• Budget process--goals, culture, characteristics
• Student issues from readings
• Preview week 3

2. Public Administration “Dichotomy” Debate
Classical Public Administration: 1880’s - 1930’s
• Focus on efficiency of large organizations
• Search for scientific principles of administration
• Expertise, not politics
• Left out concern for politics, values, ethics
Behavorial: 1940s - 1960s
• Dichotomy questioned
• From efficiency to effectiveness
• Human element, behavior, decision making in
organizations
• Led to new kind of science of administration
• Continued to ignore politics

3. Public Administration “Dichotomy” Debate (cont.)
The New Public Administration: 1970s -
• No dichotomy
• Try to bring managerial and political values together
• Two branches
– Public policy
• looked at politics in policy but not in administration
• PA moved to Business Schools
– Political management
• the governance function of public administration
• define the role of public managers in political system

4. Budgeting as Political
Budget (document) Budgeting (process)
• scope of government • preparing and
• redistribution of wealth defending requests
• priorities • strategy--what to
• reflects relative power reveal, what to conceal
• reflects public • roles in process--who
has power
consensus
• accountability to
public

5. Budgeting as Technical?
• estimating revenues
• estimating costs (benchmarks)
• knowing all rules and constraints
• spending limitations -- legal
• spending requirements
• limits on borrowing
• need for public referenda (spending and revenues)
• different funds
• presenting information
• accounting/allocating (baseline, one-time)

6. Budget Management: political or technical?
• Internal allocation
– how much is needed?
– aligning incentives
• Staying within budget
• Reallocation
• Determining and using reserves
• Publication -- how much to reveal
• Transfers among funds
• Year end strategies

7. Political v Technical
• Budget as a Document
___% technical
___% political
• Budgeting as a Process
___% technical
___% political
• Budget Management
___% technical
___% political

8. The “Baseline” Budget
How to compute it:
• Current year initial budget
• Current year revised budget
• Current year expenditures
• Current services level adjusted forward (inflation,
caseload)
• Current law
• Current year budget less one-time
• CSUS case study: Program of Dance

9. Rubin’s Model of Budgetary Decision Making
– Environment
– Process
– Strategies
– Outcomes

10. Rubin’s Model of Budgetary Decision Making
• Environment
– Affects outcomes directly
– Affects strategies
– Affects process
• Process
– Affects outcomes directly
– Affects strategies
• Strategies
– Affects outcomes directly
– Affects process

11. Actors in Public Budgeting
• Chief Executive
• Executive branch chiefs
• Control agencies
– executive
– legislative
• Legislators
• Interest groups
• Public

12. Mini-Case -- Indian Health Program
• What is the committee chair trying to accomplish?
• Why is the Bureau Chief in a difficult position?
• What power does the committee chair have over the
Assistant Secretary and the Bureau Chief?
• What power does the Assistant Secretary have over the
Bureau Chief?
• Did the Assistant Secretary do a good job of responding?
• Did the Bureau Chief do a good job of responding?

13. Budget Process
• Designed to meet organizational goals
• Reflects organizational culture
• Variables
– players
– rules/procedures/documents/timelines
– balance of executive/legislative power
– degree of centralization/coordination
– top-down/bottom-up
– openness to internal members
– openness to external community

14. Design a Budget Process for a School District
Units: Process Variables:
• 4 elementary schools • roles of various players
• 2 middle schools • authority/balance of
power
• 1 high school
• rules/procedure
• documents/timelines
Players: • executive v legis power
• superintendent/staff • degree of centralization
• school board • top down/bottom up
• 7 principals • openness to internal
• 7 PTAs • openness to external

15. Preview of Week 3
• Lots of different, but short, readings
– Congressional Budget Office
– Legislative Analysts Office
– Department of Finance
• Think about:
– Differences between State and Federal Processes
– Different roles of LAO, Finance
– In four sample LAO analyses, think about what they are trying to
accomplish
• Guest Speaker from Corrections, LAO, DOF (current)
• Remember first weekly email assignment (sample on web)