Memos to the Governor
Introduction to State Budgeting, Second Edition, Updated
Dall W. Forsythe, Foreword by Governor Mario M. Cuomo
Introduction and Overview;
As a new Governor, you have a variety of engrossing responsibilities and prerogatives. Among the most important is the central role you now play in formulating the state’s budget. As you will discover, your executive budget does not come with an ‘‘owner’s manual,’’ so these memos are designed to help you begin thinking about budget strategy and tactics.
New governors come to office from a variety of backgrounds, with different kinds of experience in budgeting. Some have held legislative posts or run executive-branch agencies. Some bring private-sector experience in financial management. A few have served as elected or appointed finance officers in state or local government. If you are taking office with a limited background in governmental budgeting, these memos will give you a broad overview of the issues and problems you will face in the budget arena. If your background in financial management is more extensive, you might still find this discussion to be a handy checklist and review of the dynamics of statehouse budget making. The heavy emphasis on budget strategy and tactics might also provide some new insight into these vital topics. Whatever your background, the discussion of budgeting and the economic cycle contains important information for political and financial survival.
During your term in office, you will spend many long and sometimes painful hours preparing your budgets and trying to sell them to the legislature. For the public, your success or failure in these activities will be one key factor in forming judgments about your gubernatorial record. Almost by definition, success in budgeting marks a governor as a strong leader, while failure in budgeting makes a governor look weak and ineffectual. When the economy slows or slides into recession, budget deficits and adoption battles can become chronic ailments, and governors typically find reelection difficult under such circumstances. In the recession of 1990–91, the leading examples were in the Northeast, where the economic downturn hit hardest and gap-closing donnybrooks were annual events for many years. As those battles wore on, chief executives, including Governors Madeleine Kunin of Vermont and William O’Neill of Connecticut, chose not to run for reelection. Others, including Governor Michael Dukakis of Massachusetts, were defeated in their reelection bids. Only Mario Cuomo, running against a weak Republican novice and aided by a conservative third-party candidate on the ballot, was reelected. A decade later, budget conflict in California, which labored under the largest projected state deficit in history, fueled a successful movement to recall Governor Gray Davis.
More substantively, budget success is the key to reorienting government. New programs, changed priorities, tax cuts or shifts in tax burdens, a larger or smaller role for government in the state’s economy— all of these objectives must be won in the budget arena.
There are no simple definitions of ‘‘budget success.’’ In these memos, a successful budget is one that delivers on a governor’s programmatic objectives and does so within financial constraints that help achieve or maintain structural budget balance. Successful budgets are not simply the result of prudent choices in the annual or biennial process of formulating an executive budget. Budget success also requires a clear understanding of the impact of the business cycle on state finances, careful consideration of long-term strategic goals, and effective negotiating tactics to get executive recommendations adopted. These three points will be emphasized again and again in these memos.
Memo 1 discusses your relationship with your budget officer and the kind of skills you should be looking for in that important member of your team. Memo 2, on budget strategy, suggests that you are most likely to succeed in achieving your programmatic goals if you fit them into a multiyear budget plan. This memo also reminds you that somewhere in your term in office you are likely to face a recession. You might try to read these two memos first, before getting into the details of budget making.
Memo 3 outlines the approach most budget offices take to budget preparation. This memo is longer and somewhat more technical than the other sections, but it will help you understand the framework for your budget choices. Memo 4 discusses the kinds of choices you may face in the late stages of budget preparation.
Memo 5 focuses on the important topic of budget tactics. As you work your way through the difficult choices that go into your executive budget, you should also be thinking about the legislature and its reaction to your recommendations. Memo 6 discusses your role in presenting the budget to the public, the press, and the legislature.
Memo 7 describes the legislative phase of the budget adoption. Memo 8 discusses the implementation of the budget adopted by the legislature. A final section emphasizes again the importance of your role in laying out a long-term budget strategy and overseeing the tactical plan aimed at passing your executive budget
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