Budgets at the Federal, State, Local and Agency Levels - Term Paper Example

?A Comparison of Public Budgets Public budgets are instruments of the government at the federal, and local levels. They are instruments in theexecution of government spending policies and a forecast of expenditures and revenues. All of them combined contribute to the national economy and are affected by policy measures and practices at each level. All of them collect revenue, usually through the form of taxes and make necessary expenditures for the operation of the various departments that comprise their role as provider to the people. With the exception of salaries and other operational expenses, their primary responsibilities are to provide services, programs and funding to various segments of the population. Federal, state, local and agency levels all have their own various programs, offices and duties that contribute to the intricate workings of the national economy as a whole. They are though each inherently individual decision-making bodies. Thornhill summarizes the most important features of a public budget as follows: • The budget, after its approval by the legislative authority, is enforceable. • The results of most of the objectives to be realized by the budget are not quantifiable. • The budget brings together a variety of considerations. • As the objectives of action taken by public institution differ widely from those of private organizations, the processes for determining the content of a public budget are therefore unique. • Authorities do not always adapt their expenditure to fit their available revenue. (check citation from original Thornbill, 1984) . Budgets at the Federal, State, Local and Agency Levels Faced with the past decade of national deficits, the recession, and other difficult situations, the United States government has had to set forth a plan to reduce debt, cut spending and increase revenues. In the news as of late because of our enormous debt and the need to raise the debt ceiling or face negative ramifications by defaulting on our loans from the World Bank. Paying higher interest rates and a reduced credit rating that would cost the US a substantial amount in interest would also have increased our debt rather than alleviate it. The government therefore has had to arrive at a budget for the coming year that would substantially cut spending to stave off further economic decline. In efforts to balance the budget, President Obama has focused on reducing military spending by reducing the number of troops in both Afghanistan and Iraq, minimal cuts in other government programs and increasing revenue with more uniform tax rates for all citizens coupled with fewer loop holes for corporations and other businesses. The nations budget is characterized by largely proportionate amounts set forth for areas of prime importance. Defense at roughly 30% , Health care at 21.5% , Social Security, 20%, Income Security at 14% and although considerably lower at 8.5% for education and job training. Other areas such as NASA and scientific discovery, Natural Resources, Immigration and Immigration Law Enforcement are all set at nearly 1- 2% and comprise the remaining 15%. In the political climate of today it is essential to spend on matters of defense and the US as leaders in promoting democracy and assisting our neighbors in need has come to the forefront since the beginning of the century. Social Security, Healthcare and Income Security, in total amount to roughly 55% is a huge sum of the budget assigned to taking care of the nation’s people. President Obama firmly believes that the road to recovery is in educating the nation’s youth and enhanced job training, so that we can advance with the times and better prepare ourselves to grow as leaders in the highly competitive world. He specifically points to areas of medicine, technology and science. 8.5% for education and job training. President Obama also hopes to increase our Gross Domestic Product with an increase in exports and foreign investments. By creating a greater demand globally and enhancing foreign trade relations. In accordance with this plan to improve trade, he has incorporated improvements in infrastructure to ensure that America’s products reach their final destinations in a more efficient manner. A rather high 5.5% is allocated for highways, and other ground transportation. For the various budgets, I chose New York State, New York City and the New York City Police Department. In New York State the budget is characterized by Governmental Funds that account for different subsections of the budget and monies are collected and then allocated and distributed according to each’s function. The sections are State Operating Funds which includes General Funds and those for specific purposes but does not include Federal Funds or Capital Project Funds. State Operating Funds include the General Fund, State Special Revenue Funds made up by certain taxes and fees, and Federal Special Revenue Funds that are recipients of Federal Grants. The States General Funds come from the majority of state taxes and all income not allocated to a specific program or purpose. The Capital Projects Funds used for costs involved in building and maintaining infrastructure and the Debt Service Funds used to pay the principal, interest and fees of the state. The areas of Higher Education, Health and Human Services, Corrections and Rehabilitation, Business, Housing, Transportation, Natural Resources, Labor and Workforce Development, Government Agencies are all funded by the state budget with revenue coming from Federal funding, personal income taxes, business taxes and sales tax. The New York City Budget is divided into sections for areas handling the various governmental agencies that exist in New York City. Among them are the Police Department, Fire Department, Sanitation and Department of Corrections, Health Care, Education (rising) Health and welfare – Social Services, Children’s Services, Homeless Services, Health Care and Education, Other Agencies – Housing Preservation & Development, Environmental Protection, Transportation, Parks and Recreation, Libraries, Department of Cultural Affairs Cuts from the state level have resulted in necessary cuts in their own spending and increased costs to residents for services and programs. New York City accounts for 60% of the State of New York total revenue in Income Taxes. The budget for an agency is much more simplistic than the other government budgets because it handles only one area of the local services provided to the people. The New York City Police Department budget is subdivided by operations and their unique departments. Patrol Borough Operations are broken up by the 5 existing boroughs with separate precincts for Manhattan North and South, Bronx, Brooklyn North and South, Queens North and South and Staten Island. Law enforcement officers and their commanders are each responsible within their respective boundaries. Within these precincts are Special Enforcement Units that handle specific areas of criminal activity such as narcotics, organized crime, gambling, prostitution, and domestic violence. The salaries and pensions of the officers and expenses involved with carrying out their duties are the primary expenditures of the agencies budget. They operate with state funding and revenue generated from fines and fees. Differences and Similarities The similarities exist to a great extent for federal, state and local budgets in the areas and programs they handle and the necessary expenditures required to operate them Health Care, Education, Arts, Natural Resources are but a few. While accounting for the same areas they are all handled at the above mentioned subsequent levels. The budget of an agency differs considerably because it accounts for only one sector of the public responsibilities at handled at a local level. Major Sources of Revenue The major sources of revenue at the Federal level are individual income taxes, social security taxes, corporate income taxes, other taxes and fees. Responsible itself for all of its expenditures with the exception of borrowing, the United States Government has a huge burden to uphold. The existing deficit has accumulated over the past ten years because of the tremendous amount spent on defense. In an effort to reduce this, taxation will have to undergo reform. At the state level, they receive federal grants and subsidies to assist them in their operations. Still, much like the federal budget, they rely primarily on taxes derived from income takes, sales tax and other fees. Local governments are supported by property taxes, business income taxes, personal income taxes, and the costs of licences and permits issues by the city. Agencies within the local government receive their funding from the local government in large part and in this case the New York City Police Department also generates revenue from fines and other fees. Possible Changes in Future Revenue Amounts President Obama is setting forth measures for tax reform to increase the amount of revenues generated from them. He has stated that a compromise was made at the beginning od his administration to prevent a rise in taxes on middle income families, he plans to oppose a permanent extension in tax cuts for families that earn in excess of $250,000 per year. His goals also include a 30% reduction in itemized deductions for those in higher income brackets. In New York State the Executive budget did not call for any increases in taxation. Instead they hope to modernize the existing tax system and has already authorized initiatives geared toward furthering that aim. Corporate taxes have grown and if they continue to do so are expected to result in a considerable gain in corporate taxes. With consumer spending increasing sales taxes are also expected to show an increase if they continue to do so. I was unable to find any information for this area What types of changes can be expected in revenue? Local - Property taxes, business income taxes, personal income tax, sales tax and revenue generated from the issue of licences and permits. They also receive assistance from the state and federal The New York Police Department does not have any projections for increasing revenue in the coming year but rather will enact a series of personnel reductions. Positions held by civilians, and 160 positions held by Police Cadets will occur. They also plan to eliminate Voluntary Vacation Pay. Federal - What they spend on for the purposes of their mission statement? according to Senator Brent Hill, the Federal Gov’t’s mission statement is defined by the Constitution We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America. (cite Brent Hill) State- What they spend on for the purposes of their mission statement? Local- What they spend on for the purposes of their mission statement? An Agency- What they spend on for the purposes of their mission statement? - New York Police Department The Mission of the New York City Police Department is to enhance the quality of life in our City by working in partnership with the community and in accordance with constitutional rights to enforce the laws, preserve the peace, reduce fear, and provide for a safe environment.- this is taken directly from the NYPD Web Site, do not use verbatim unless citing it References - Your paper must contain at least five references, and may include Internet sources, books, and professional journals or resources related to the profession. 1.Theoretical Approaches to Public Budgeting by Mihaly Hogye http://lgi.osi.hu/publications/2002/216/101-Theory.pdf 2.THE BUDGET MESSAGE OF THE PRESIDENT, Barack Obama The White House, February 14, 2011., http://www.whitehouse.gov/sites/default/files/omb/assets/budget/03_Presidents_Message.pdf) 3.Government’s Mission Statement:The Constitution, by Senator Brent Hillhttp://www.senatorhill.com/articles/2002-07Constitution.html 4. NEW YORK STATE ENACTED BUDGET FINANCIAL PLAN FOR FISCAL YEAR 2012, http://publications.budget.ny.gov/budgetFP/2011-12EnactedBudget.pdf 5. Briefing on Mayor Bloomberg’s Preliminary FY 2012 New York City Budget, March 2011, http://www.fiscalpolicy.org/FPI_NYCBudgetBriefing_20110302.pdf 6. Understanding New York City’s Budget, A Guide, New York City Independent Budget Office http://www.ibo.nyc.ny.us/iboreports/understandingthebudget.pdf 7. NYPD- Official Cite of the New York City Police Department http://www.nyc.gov/html/nypd/html/home/mission.shtml 8. Hearing on the Mayor’s Fiscal Year 2012 Preliminary Budget & the Fiscal Year 2011 Preliminary Mayor’s Management Report, March 2011, http://council.nyc.gov/html/budget/PDFs/2012/nypd_056.pdf Read More