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Details Title: Peng Test 2 Description: Cards for Peng test 2 Total Flash Cards: 55 Created: 03/28/2006 19:37:37	To study from this set of flash cards, or to create your own your own study flash cards, register HERE. If you are already a registered user, CLICK HERE.
Cards Term Captial budget Definition a budget for financing capital projects Term operating budget Definition budget for day to day operations Term 3 models for deciding what captial projects to fund Definition 1. rational actor 2. organizational process 3. governmental politics Term rational actor model Definition - rationally come up with a decision package - based on benefits the projects can create - cant rely on this because benefits are hard to compare Term organizational process Definition 1. Is it mandated 2. Will it pay for itself 3. Establishing a process (like a committee) 4. Establishing criteria Term governmental politics Definition mainly pork barreling Term funding of captial projects Definition - long term in nature - should match strategic plan of city Term Financial planning Definition - how does this years actions effect multi year planning - everything is based on current year - everything in future is a projection Term four concepts of budget balance Definition 1. annual balance 2. biennial balance 3. structural balance 4. cyclical balance Term annual balance Definition - balacing the budget every year - required to be balanced on a cash basis - allows for delayment of payments Term annual balance equation Definition revenue (recepts) = spending (disburcements) Term biennial balance Definition - budget is balanced on a two year basis - more difficult - can not delay payments Term biennial balance equaltion Definition Annualized Receipts= Annualized Disbursements Term structural balance Definition - looking at if recurring revenue is equal to recurring spending - two levels: year to year and long term Term year to year structural balance Definition Take out all one time spendings and revenue and look and see if it is balanced Term long term structural balance Definition - Making long term projections about spending and revenue growth - If spending is greater than revenue, then you have a long term structural problem Term structural balance equation Definition Recurring receipts = recurring disbursement Term cyclical balance Definition - In the long run revenue behaves with an up and down movement on a graph - Spending remains fairly constant upwards - When revenue is more than spending = cyclical surplus - When revenue is less than spending = cyclical deficit Term cyclical equation Definition cyclical surplus = cyclical deficit Term what factors can cause a budget shortfall to occur? Definition 1. economy 2. forecasting error 3. governmental tax policy 4. spending 5. courts 6. federal government Term two types of budget shortfalls Definition known and unknown Term known budget shortfall Definition You know that you have a deficit after baseline budgeting is done Term unknown budget shortfall Definition You may have a balanced budget but during the fiscal year you can still incur a deficit Term gap closing approaches Definition 1. short term solutions to known budget shortfalls 2. solutions to unknown budget shortfalls 3. programatic cuts 4. budget gimimicks Term short term solutions to known budget shortfalls Definition - decrease spending - increase revenue Term decreasing spending in short term Definition - across the board cuts - delay maintance - no new programs - partical funding Term increasing revenue in short run Definition - raise selective tax (like Tobacco) - create tax amnesty so people will pay - increase user fees - temporary broad base tax increase - perminent broad base tax increase Term solutions to unknown budget shortfalls Definition - limit appropriations to a percentage of estimated revenues - budget stablization funds Term budget stabilization funds Definition - Money you can draw from when there is a deficit - buys you time without having to take action - replace money later Term K-12 cuts Definition - per student - will never be less than last year Term Higher Ed cuts Definition - takes big cuts because it is discretionary (no subject to federal guideline and has other sources of revenue) Term healthcare cuts Definition - need to control program growth Term ways to control healthcare growth Definition - sticter eligibility - controlling drug costs - increase copayments - cut abuse out of system Term Criminal Justice Cuts Definition control cost by 1. Look at the offenses that send people to jail 2. Look at sentencing 3. Private prisons Term across program cuts Definition 1. freeze salaries 2. freeze hiring 3. cut positions Term state budget adoption Definition • Once it gets proposed by the Governor it goes to Budget Analysts to determine if anything is wrong • Legislature gets it, negotiates, adopts • Goes back to governor for signature or veto Term federal budget adoption Definition • Once it gets proposed by the prez it • Legislature gets it, sets a budget resolution, negotiates, adopts • Goes back to prez for signature or veto Term leg vs. exec in budgeting Definition prez is more nation center, leg is more state centered Term variables that affect executive success in budgeting Definition 1. size of budget office 2. veto power 3. where you are in election cycle(easier in first couple years) Term test of success for executive in budgeting Definition - If they get their priorities - Changes (how different is the final budget from the one they proposed) - Growth rate of the budget Term legislative players in budgeting Definition 1. leaders 2. committee chairs 3. memebers 4. staff Term legislative leaders priorities Definition 1. Maintain majority 2. Increase Majority Term committee chair trends Definition - involed in own programs - favor increased spending Term legislative memeber trends and priorities Definition 1. reelection 2. increase party strength 3. have diverse interests Term legislative staff trends Definition - keep party in power - find money for party Term interest groups influence on budgeting Definition 1. vote for candidates 2. money 3. initiatives Term two goals in budget execution Definition 1) Execute the budget as planned 2) Change the plan if the conditions change Term two main functions in budget execution Definition 1. control 2. monitoring Term Parts of control Definition 1. allocation: giving out money 2. witholding: not giving money if u know changes need to me made Term Budget monitoring Definition variance anaylsis: making the needed changes to execute the budget and know why they occur Term Why preformance budgeting? Definition accountability, evaluation, benchmark Term performacne measures Definition Input, Output, Outcomes, Efficiency Term 2 levels of incentives Definition Organizational, Individual Term organizational incentives Definition budget increase, gain sharing, carry over, less oversight, recognition Term individual incentives Definition promotionl, bonus, raise, recognition