1. Week 10: Budget Analysis Categories of analysis Criteria for analyzing budget requests Review sample LAO analyses Budget analyst’s vocabulary Special case of “positions” Budget analysis exercises

2. Categories of Budget Analysis Revenue related Technical Budget management Workload/caseload Policy Program redesign Audit/compliance

3. Criteria for Analyzing Budgets did they provide enough information? is the information accurate? are current and/or proposed programs effective? are programs cost effective? are appropriated amounts sufficient to do what is proposed? are there any equity issues to be considered? is this proposal administratively feasible? are there legal issues with ongoing or proposed budgets? is the proposed timing reasonable? are funding sources used appropriately? is it reasonable, given past history or other similar situations? are appropriated funds being used as intended? are there issues of Legislature oversight?

4. Budget Analyst’s Vocabulary workload/caseload marginal cost v average cost opportunity cost hard v soft money baseline v one-time costs/revenues salary savings carry over decentralization/flexibility micro-management

5. Budget Analyst’s Vocabulary – cont. “May Revise” supplemental report language budget bill language technical adjustment budget deficiency/deficiency request structural budget problem current year revised budget merit salary adjustments (MSA) (unfunded/funded) reimbursements

6. Budgeting for Positions Position budgeting –good workload measure; analytical tool; control –limits flexibility for managers; can be manipulated Position v dollar budgeting Premium on positions: generate ongoing $$, increases Salary savings Position “games” –by agencies: to generate savings –by DOF: cut the size of state bureaucracy

7. Preview of Week 11 Eureka Budget Simulation –Tim Hodson, Executive Director, Center for California Studies, CSUS http://www.csus.edu/calst/Civic_Education/eureka.html –bring your Eureka guides no reading; no email questions mid-term due by beginning of class