TEST BANK FOR STATE AND LOCAL GOVERNMENT

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CHAPTER 8
Public Administration: Budgeting and Service Delivery

 LEARNING OBJECTIVES
 To understand the state budgetary process, including key actors and critical processes.
 To be familiar with the components of merit systems.
 To be able to explain the challenges of representative bureaucracy and affirmative action,
sexual harassment, and public employee unionization and collective bargaining.
 To explain the clash of politics and bureaucracy.
 To describe new public management and its strategies, including privatization and e-
government.

 SUMMARY OVERVIEW
Bureaucracy often takes the blame for all the ills of government. It is depicted as all -
powerful, out of control, inefficient, wasteful, and drowning in red tape. Bureaucrats are
often described as insensitive and uncaring. Nearly everyone, from elected officials—
presidents, governors, mayors, and legislators at all levels as well as talk-show
commentators, television and film script writers, bloggers, and even product advertisers have
stridently bashed the bureaucrats, blaming them for all imaginable governmental sins of
omission and commission.
In reality bureaucrats are responsible for operationally defining key components of public
policies and putting the policies into effect. Some bureaucracies make our lives more
difficult, but others improve the quality of our existence by enforcing the laws and punishing
the criminals, putting out the fires, repairing and maintaining the roads, and helping the poor
and disadvantaged among us. Heroic, life-saving actions by police and firefighters are
commonplace, but seldom recognized publically.
The quality and capacity of public administration have improved markedly in the vast
majority of the country’s states, municipalities, and counties in terms of the characteristics of

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66 Chapter 8: Public Administration: Budgeting and Service Delivery

employees and the efficiency, effectiveness, and professionalism with which they perform
their duties. Government workers are just as motivated, competent, and ethical as private -
sector workers. Public employees are much more accountable and responsive to political
actors and to the public than they are popularly perceived to be. These state and local
government employees constitute more than 19 million Americans. Government work tends
to be labor-intensive. As a result of this fact and because of inflation, personnel expenditures
for states and localities have risen even faster than the number of workers. Total payroll costs
for state and local governments exceed $278 million per month. California, for instance, has
some 2.25 million state and local employees on its payroll, compared with only 48,802 in Vermont.
Public employees include the police officer on patrol, the welfare worker finding a foster home for
an abandoned child, the eleventh-grade English teacher, the state trooper, and the college
professor who works for the state university. Their tasks are as diverse as their titles: sanitation
engineer, animal-control officer, heavy-equipment operator, planner, etc. Approximately one of
every six working Americans is employed by government at some level. If bureaucrats are the
enemy, we have met them, and they are us.
To understand public administration, one must have a grasp of budgetary politics. It is a policy
statement of what government intends to do (or not do), detailing the amount of the taxpayers’
resources that it will dedicate to each program and activity. The outcomes of the budgetary
process represent the results of a zero-sum game—for every winner there is a loser—because
public resources are limited. The process of governmental budgeting is best understood as a cycle
with overlapping stages, five of which can be identified: preparation, formulation, adoption,
execution, and audit.
Four main actors participate in the budget process: interest groups, agencies, the chief executive,
and the legislative body. Interest groups organize testimony at budget hearings and pressure the
other three actors to pursue favored policies and programs. To cope with such complexity and
minimize political conflict over scarce resources, decision makers “muddle through.” They
simplify budget decision making by adopting decision rules. That is, instead of searching for
the optimal way to address a public policy problem, they search only until they find a feasible
solution. As a result, they sacrifice comprehensive analysis and rationality for incrementalism,
in which small adjustments (usually an increase in good times) are made to the nature and
funding base of existing programs.
A major way in which the bureaucracy has changed is through the adaption of the merit system.
In an effort to avoid the problems associated with patronage, the public sector has sought to
hire based on an objective approach, mostly in the form of testing given to all applicants. This
system has had mixed results, faring better in some states than others. This is, in part, due to the
fact that many states have not eliminated patronage even though they have appeared to do so.
There have also been many attempts to modify a purely objective system by incorporating
principles in the bureaucracy that attempt to help some disadvantaged groups gain access.
These controversial procedures include such concepts as representative bureaucracy and
affirmative action.
Another controversial aspect of the personal system has been the unionization of public
employees. Unions are controversial because many citizens believe that their existence
undermines the merit system and makes it difficult for government to implement policy in an
efficient and effective manner. Despite these criticisms public sector unions remain an
important and powerful component of state and local politics.
Innovation has become an important aspect of personnel management at the state and local
level. The concept of reinventing government has had a significant influence introducing such
ideals as entrepreneurship in bureaucrat procedures. At the same time privatization has become

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 Chapter 8: Public Administration: Budgeting and Service Delivery 67

a way to manage public services in difficult times. It has resulted in transferring many public
services to the private sector. This has included many different functions ranging from garbage
collection to public safety. The results are mixed especially when it comes to saving money.
State and local governments in the twenty-first century are now extensively involved with
technology. It is changing the way various government activities are conducted and making the
face of government more user-friendly. For example, many state and local governments permit
online tax filing and renewal of licenses and registrations. Technology is also making government
more interactive. Citizen complaints and opinions are easily sent to government officials. Also, in
some states and localities it is becoming easier to engage more actively in government by voting
online and viewing government meetings on the Web.

 CHAPTER OUTLINE
I. PUBLIC EMPLOYEES IN STATE AND LOCAL GOVERNMENTS: WHO THEY
ARE, WHAT THEY DO
 Bureaucracy is paradoxical.
o Bureaucracy is often viewed negatively.
o Public employees often do an outstanding job of enacting public policy.
o Public employees should not be seen as scapegoats for all that is wrong
with government.
 Controversies in States and Localities: Damned If You Do . . .
 Facts about bureaucracy
o About 20 million people are employed by state and local governments.
o The number of bureaucrats varies from state to state.
o Occupations are widespread, from police to doctors
o One out of six Americans is a state and local government worker.
II. BUDGETING IN STATE AND LOCAL GOVERNMENTS
A. The Budget Cycle
 Formulation
o The initial phase of the budget cycle involves demands by
groups that want their share.
o The budget includes all who seek government funds.
 Adoption
o Based on history of past budgets
o Often amended to satisfy the powerful
 Execution
o Protect the status quo and balance the budget
 Audit
o Fiscal audit are conducted to verify expenditure records.
o Performance audits examine agency activities to assure
government efficiency, effectiveness, and accountability.
 Governing in Tough Times: Escaping (at Least for the Time Being) Fiscal
Disaster
B. The Actors in Budgeting
 Interest groups
o Testify and lobby to get what they want

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68 Chapter 8: Public Administration: Budgeting and Service Delivery

 Agencies
o Seek political strategies, such as always asking for more money
 The chief executive
o Designs budget to fit priorities
 The legislature
o Modifies the initiatives of the chief executive
o Reviews agency demands
o Responds to constituents desires
C. Pervasive Incrementalism
 Objectives unclear and often in conflict
 Not easy to determine rational process
 Resorts to incrementalism—essentially relying on previous budget with
marginal changes
D. Types of Budgets
1. Control Through Line Item Budgets
 Specifies amount each agency receives
 Accounts for all expenditures
 Shows where money goes
2. Budgeting for Performance
 Allows for more rational and flexible decision-making
 Seeks to ensure priorities are carried out
 Implements formal programs and policy evaluations
3. Capital Budgets
 Examines big ticket purchases, such as hospitals, libraries,
bridges over long periods of time
 Shows how debt is paid back
 Funded through general obligation bonds
III. HUMAN RESOURCE POLICY IN STATE AND LOCAL GOVERNMENTS:
FROM PATRONAGE TO MERIT
A. The Merit System
 Merit principle is used to determine all personnel decisions.
 Neutral competence: Primary criterion for obtaining government jobs.
 Many states have enacted merit-based civil service.
 Merit system has had mixed results.
B. State and Local Advances
 State and local personnel systems are improving.
 Making executive branch more efficient
 Using new methods such as pay-for-performance
C. Merit System Controversies
1. Representative Bureaucracy
 Bureaucrats have discretion.
 Workforce represents the pubic it serves.
 It provides symbolic evidence of a democratic form of
government.
 Equal employment opportunity is mandated by law.

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 Chapter 8: Public Administration: Budgeting and Service Delivery 69

 A controversial problem is how to achieve representation

without sacrificing merit.
 Affirmative action means hiring groups who have been
discriminated against.
2. Sexual Harassment
 Sexual Harassment can consists of various behaviors:
o Unwanted touching or other physical contact of a sexual
nature
o Implicit or overt sexual propositions
o Extortion of subordinate by supervisor
o Hostile working environment
 Sexual harassment is widespread in the workplace.
3. Unions
 Unions are a threat to merit principle.
 They are most powerful in Midwest and Northeast.
 About 32 percent of state and 42 percent of local government
workers are unionized.
 Public employee unions yield considerable power.
 Unions engage in collective bargaining.
IV. THE POLITICS OF BUREAUCRACY
A. Joining Administration and Politics
 Bureaucrats are involved in public policy making.
 Civil servants have considerable bureaucratic discretion.
 Success of public policy depends on administrators.
 Power is derived from knowledge, expertise, information, and
discretionary authority.
V. NEW PUBLIC MANAGEMENT
 New Public Management (NPM): The argument that government should
manage for results, through entrepreneurial activity, privatization, and
improvements in efficiency and effectiveness.
A. Alternative Service Delivery Mechanisms
1. Intergovernmental Cooperation
2. Privatization
 Shift state and local services to the private sector
 The belief is that privatization will save money.
 Some state and local governments attempt competition among
private businesses.
 Results have been mixed.
B. E-Government
 Use of information technology
 Paperless offices
 Governmental services online
VI. THE QUALITY OF PUBLIC ADMINISTRATION
 Quality has improved.
 Doing better at managing money, people, infrastructure, and information
 In partnership with private sector, able to achieve more

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70 Chapter 8: Public Administration: Budgeting and Service Delivery

 CRITICAL THINKING QUESTIONS

1. What are the pros and cons of privatization?
2. What is meant by the politics of the budgetary process?
3. What is meant by incrementalism in public policy and the budget?
4. How does incrementalism differ from program budgeting?

 LECTURE LAUNCHERS
1. Give a lecture on “reinventing government.” Be sure to include concepts, such as
empowering people rather than simply delivering services, injecting completion into
service delivery, and using market incentives to produce bureaucratic change. Include
examples where these methods have been tried. Discuss with your students how
attempting to apply private sector concepts often fail in the public sector because of the
differences between the two. Try to get your students to delineate the differences between
private and public sector delivery of services.
2. Lead a discussion on the pros and cons of privatization. Describe the expected results.
Talk about why state and local governments see this approach as an attractive alternative
to public sector bureaucracy. Use as many examples as possible that seem to reflect
positive results and some examples of those that have had negative outcomes.
3. Give a lecture on the budget-making process. Be sure and include the role of the
governor, the agencies, interest groups, and the legislatures. Review the material in the
text about the strategies used by agencies to get their way in the process. You may want
to review Wildavsky’s work in this area.

 IN-CLASS ACTIVITIES
1. Have students discuss the issue of representative bureaucracy. Is it a desirable goal? If so,
how should it be achieved? Compare an attempt to apply this principle in a democracy to
attempting to apply it in a bureaucracy. Have students talk about the differences between
bureaucracy and the political branches of government. How do the merit system and
other non-political and objective practices of a professional bureaucracy fit-in with the
concept of representative bureaucracy? Can a bureaucrat be both a representative and a
professional?
2. Have students examine how patronage is implemented at the state and local level in your
state. What jobs at the state and local levels are not covered by the merit system? Have
them develop a profile of some of these positions. Have them discuss whether or not the
public would be better served if these positions were no longer patronage.
3. Have your students examine how privatization has been implemented at the state or local
level. Ask them to search out examples and make an attempt to determine what has
changed for the better or the worse. See if it is possible in those cases where
improvements have not been made to revert back to the old system.

 KEY TERMS

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 Chapter 8: Public Administration: Budgeting and Service Delivery 71

affirmative action Special efforts to recruit, hire, and promote members of disadvantaged
groups to eliminate the effects of past discrimination.
bureaucracy The administrative branch of government, consisting of all executive offices and
their workers.
bureaucratic discretion The ability of public employees to make decisions interpreting law and
administrative regulations.
capital budget A budget that plans large expenditures for long-term investments, such as
buildings and bridges.
clientele groups Groups that benefit from a specific government program, such as contractors
and construction firms in state highway department spending programs.
collective bargaining A formal arrangement in which representatives of labor and management
negotiate wages, benefits, and working conditions.
e-government The use of information technology to simplify and improve interactions between
governments and citizens, firms, public employees, and other entities.
incrementalism A decision-making approach in the budgetary process in which the previous
year’s expenditures are used as a base for the current year’s budget figures.
line item budget A budget that lists detailed expenditure items such as personal computers and
paper, with no attention to the goals or objectives of spending.
merit system The organization of government personnel to provide for hiring and promotion on
the basis of knowledge, skills, and abilities rather than patronage or other influences.
neutral competence The concept that public employees should perform their duties competently
and without regard for political considerations.
New Public Management The argument that government should manage for results, through
entrepreneurial activity, privatization, and improvements in efficiency and effectiveness.
performance budgeting Budgeting that takes into account the outcomes of government
programs.
representative bureaucracy The concept that all major groups in society should participate
proportionately in government work.

 WEB LINKS
All major municipalities and states have web pages. Many provide links to jobs, New
Public Management initiatives, service-provision information, and other data. Innovative, award-
winning websites include Indianapolis’s “Electronic City Hall” at: (www.indygov.org), Service
Arizona at: (http://servicearizona.com), NC@YourService at: (www.ncgov.com), Access
Washington at: (www.access.wa.gov), and Delaware’s website at: (http://www.delaware.gov).
An Internet-based clearinghouse on GIS is maintained by the Center for Technology in
Government at: (www.ctg.albany.edu/gisny.html). Another interesting site on technology and
government is located at: (www.govtech.net).
Another interest technology site is The National Center for Digital Government. It is located at
the University of Massachusetts, Amherst. It, too, is interested in improving technology at all
levels of government. It is located at: (http://www.umass.edu/digitalcenter/research/index.html).

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72 Chapter 8: Public Administration: Budgeting and Service Delivery

An informative public-employee union website is AFSCME’s at: (www.afscme.org).

For a step-by-step illustration of a state budget process, see:
(http://www.budget.state.ny.us/citizen/process/process.html). Check out Kansas, Texas, and
Missouri “see through budget” sites at:
(http://www.kansas.gov/KanView/;%20www.window.state.tx.us/); (www.mapyourtaxes.mo.gov).
To view streaming videos of public meetings in Indiana, visit: (www.stream.hoosier.net/cats).
Information on the Government Performance Project is found at: (www.governing.com).

 INSTRUCTOR RESOURCES
Readings
Blais, André, and Stephane Dion, eds. The Budget-Maximizing Bureaucrat: Appraisals and
Evidence. Pittsburgh, PA: U of Pittsburgh P, 1991.
Bozeman, Barry. Bureaucracy and Red Tape. Upper Saddle River, NJ: Prentice Hall, 2000.
Goodsell, Charles T. The Case for Bureaucracy: A Public Administration Polemic, 4th ed.
Washington, DC: CQ Press, 2004.
Gormley, William T., Jr., and Steven J. Balla. Bureaucracy and Democracy: Accountability and
Performance. Washington, DC: CQ Press, 2003.
Gosling, James J. Budgetary Politics in American Governments, 3rd ed. New York: Routledge,
2005.
Greene, Jeffrey D. Cities and Privatization: Prospects for the New Century. Upper Saddle River,
NJ: Prentice Hall, 2002.
Guy, Mary E., ed. Women and Men of the States: Public Administrators at the State Level.
Armonk, NY: M.E. Sharpe, Inc., 1992.
Hays, Steven W., and Richard C. Kearney, eds. Public Personnel Administration: Problems and
Prospects, 4th ed. Englewood Cliffs, NJ: Prentice Hall, 2003.
Kettl, Donald F., and John J. DiIulio, Jr. Inside the Reinvention Machine: Appraising
Governmental Reform. Washington, DC: The Brookings Institution, 1995.
-----, and James W. Fesler. The Politics of the Administrative Process, 3rd ed. Washington, DC:
CQ Press, 2005.
Lee, Robert D., Ronald W. Johnson, and Philip Joyce, Public Budgeting Systems, 7th ed. Boston,
MA: Jones and Bartlett Publishers, 2003.
Nice, David. Public Budgeting. Belmont, CA: Wadsworth, 2002.
Osborne, David, and Ted Gaebler. Reinventing Government: How the Entrepreneurial Spirit Is
Transforming the Public Sector. Reading, MA: Addison-Wesley, 1992.
-----, and Peter Plastrik. Banishing Bureaucracy: Five Strategies for Reinventing Government.
Reading, MA: Addison-Wesley, 1997.
Rubin, Irene S. Class, Tax, and Power: Municipal Budgeting in the United States. Washington,
DC: CQ Press (A Chatham House Title), 1998.
----. The Politics of Public Budgeting: Getting and Spending, Borrowing and Balancing, 5th ed.
Washington, DC: CQ Press, 2005.

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 Chapter 8: Public Administration: Budgeting and Service Delivery 73

Wildavsky, Aaron, and Naomi Caiden. The New Politics of the Budgetary Process, 5th ed. New
York: Longman, 2004.

Films or Videos
The Bureaucracy. (30 min.) The program provides a look at the relationship between bureaucracy
and the needs of citizens. It explores the issues of responsiveness of bureaucracy. Mainly focused
on the federal level, but many of the insights are transferable to state and local government.
Insight Media, 2162 Broadway, New York, NY 10024.
The Bureaucracy of Government: John Lukacs. (30 min.) Historian John Lukacs, a refugee from
Hungarian communism, discusses the liberal and conservative lament over the invisible
mechanism called bureaucracy. Films for the Humanities and Sciences, PO Box 2053, Princeton,
NJ 08543-2053.
Getting Out of Business: Privatization and the Modern State. (59 min.) Provides arguments
against the belief that government can provide services better than private business. Films for the
Humanities and Sciences, PO Box 2053, Princeton, NJ 08543-2053.
The Invisible Government. (20 min.) Bureaucratic procedures and problems illustrated. Narration
by the late Rep. Morris Udall. Relates to the federal level, but the material is transferable to
nonnational governments. Prentice Hall Media, 150 White Plains Road, Tarrytown, NY 10591.

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74 Chapter 8: Public Administration: Budgeting and Service Delivery

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