PA 5114
Budget Analysis in Public and Nonprofit Organizations
Humphrey Institute of Public Affairs, U of MN (1.5 Credits)
4 – 5:30 M, W, F (01/20/2016 – 02/19/2016)
Blegen 130
I. Course Description
There is increasing demand for public and non-profit organizations to manage
their finances well while providing quality services. Governments are pressured to “do
more with less” and nonprofit organizations are expected to “do better in doing good”. In
order to meet these challenges, it is important that managers and employees of public and
nonprofit organizations possess the fundamental skills of budgeting analysis and
management.
This course focuses on analysis of financial resources for public and nonprofit
organizations. Emphasis is placed on operating and capital budgeting.
The primary objective of this course is to help students understand and use
analysis to develop solutions for budgets of public and nonprofit organizations.
Conceptual frameworks and analytical techniques will be emphasized and applied to
analyze real-world budgets.
II. Desired Student Outcomes:
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Understand budgeting as an integral part of nonprofit/public management
Obtain basic knowledge, terminology, and skills in nonprofit/public budgeting
Develop capability to perform basic budget analysis functions of nonprofit/public
organizations
Understand key financial theories such as time value of money, cost-benefit
analysis, break-even analysis, sensitivity analysis, and fiscal analysis.
Improve critical thinking, analysis, communication, and writing skills regarding
financial matters
III. Instructor
P. Jay Kiedrowski, EdD
Senior Fellow
Phone: 612-626-5026
Email: kiedr003@umn.edu
Room HHH 248
Office Hours: M 1:30-3:30
Other Appointments by Request
IV. Learning Design
A. Learning Methods:
• Reading and Studying All Assigned Materials
• Completing Assignments before Class
• Analyzing Case Studies before Class
• Participating in Class Discussion
B. Assignments:
For each class, there will be a set of questions/problems and/or a case study that
you are to prepare in writing. I will ask one or many of you to present the solution to each
problem/question and case study questions. We will review the problems/questions and
case studies together in class. You will be asked to hand-in the assignment at the end of
class, and it will be returned at the next class with 1 point representing your assignment
and participation grade for that class.
Participation in preparation of your assignments, presentation of
problems/questions and case studies in class, and involvement in the discussions in class
will constitute 35% of your grade. Participation will be graded on the quality of your
contributions, not the quantity. Hallmarks of good participation include a) risk taking presenting an opposing view or a different interpretation of the data; b) listening - trying
to understand what others are saying and why they are saying it; c) bringing your own
experiences when relevant into discussions; d) monitoring your own participation in
terms of both amount and quality; and, e) completing all of your assignments well.
There will be an exam worth 65% of your grade. The exam will be a set of word
questions and financial problems based on the assignments.
Participation
Exam
Total
35 points
65 points
100 points
C. Textbooks/Reading Materials

Textbook – There will be no single textbook in this class because no one text
book covers the material of this class. Rather we will use chapters from
numerous books to inform us.

Moodle – The course website is an important part of the course and is located
on Moodle (see below for instructions on usage). You must check the website
before each class to attain the necessary readings, assignments, power points,
and grades. We will also be using the website for timely class announcements.
Moodle is a course management system that emphasizes online learning
communities with built-in tools, including peer-review forums and glossaries
that students build together. We will use the basic functions of Moodle and
will also explore opportunities to facilitate online communication and group
work within the class. If you are not familiar with Moodle, a good way to get
started is to watch the “student orientation” at
https://umconnect.umn.edu/moodleorientation or visit the support page at
http://www1.umn.edu/moodle/students/.
Moodle sites can be accessed on any computer that has an internet connection
and a web browser. The UMN Moodle support team recommends using
Mozilla Firefox. For more information, including a free Firefox download, go
to http://www1.umn.edu/moodle/start/technical.html.
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To access the Moodle course website, go to http://moodle.umn.edu. Once
logged in, you will see links to the sites to which you have access. For
additional questions, you may contact Mary Lou Garza at garza001@umn.edu
or me.

Other relevant materials will be distributed throughout the semester.
D. Student Assessment
Grading levels are as follows:
•
A
•
A•
B+
•
B
•
B•
C+
•
C
90.0-100.0 Points
85.0-90.0 Points
80.0-85.0 Points
75.0-80.0 Points
70.0-75.0 Points
65.0-70.0 Points
60.0-65.0 Points
I (Incomplete) may be assigned at the instructor’s discretion if, due to
extraordinary circumstances, the student was prevented from completing their course
work on time. The assignment of an Incomplete requires the written agreement between
the instructor and the student specifying the time and manner in which the student will
complete his/her unfinished work.
There is no “extra credit” available in this course.
E. Attendance:
All students are expected to read all the material, complete the problems assigned,
attend class, and be on time. Points will be deducted from your Participation Grade for
missing class without cause. If you are absent from a session, you must make
arrangements to obtain notes and handouts from other students. There will be class
discussion, so active class participation is encouraged. You need to turn in your
assignment for a missed class if you want any credit for that class.
F. Student Conduct Code:
The University seeks an environment that promotes academic achievement and integrity,
that is protective of free inquiry, and that serves the educational mission of the
University. Similarly, the University seeks a community that is free from violence,
threats, and intimidation; that is respectful of the rights, opportunities, and welfare of
students, faculty, staff, and guests of the University; and that does not threaten the
physical or mental health or safety of members of the University community.
As a student at the University you are expected adhere to Board of Regents Policy:
Student Conduct Code. To review the Student Conduct Code, please see:
http://regents.umn.edu/sites/default/files/policies/Student_Conduct_Code.pdf.
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Note that the conduct code specifically addresses disruptive classroom conduct, which
means "engaging in behavior that substantially or repeatedly interrupts either the
instructor's ability to teach or student learning. The classroom extends to any setting
where a student is engaged in work toward academic credit or satisfaction of programbased requirements or related activities."
G. Use of Personal Electronic Devices in the Classroom:
Using personal electronic devices in the classroom setting can hinder instruction and
learning, not only for the student using the device but also for other students in the class.
To this end, the University establishes the right of each faculty member to determine if
and how personal electronic devices are allowed to be used in the classroom. For
complete information, please reference:
http://policy.umn.edu/Policies/Education/Education/STUDENTRESP.html.
For PA 5111, all phones should be shut off not used in class for any purpose. Laptop
computers may be used in class.
H. Scholastic Dishonesty:
You are expected to do your own academic work and cite sources as necessary. Failing to
do so is scholastic dishonesty. Scholastic dishonesty means plagiarizing; cheating on
assignments or examinations; engaging in unauthorized collaboration on academic work;
taking, acquiring, or using test materials without faculty permission; submitting false or
incomplete records of academic achievement; acting alone or in cooperation with another
to falsify records or to obtain dishonestly grades, honors, awards, or professional
endorsement; altering, forging, or misusing a University academic record; or fabricating
or falsifying data, research procedures, or data analysis. (Student Conduct Code:
http://regents.umn.edu/sites/default/files/policies/Student_Conduct_Code.pdf) If it is
determined that a student has cheated, he or she may be given an "F" or an "N" for the
course, and may face additional sanctions from the University. For additional
information, please see:
http://policy.umn.edu/Policies/Education/Education/INSTRUCTORRESP.html.
The Office for Student Conduct and Academic Integrity has compiled a useful list of
Frequently Asked Questions pertaining to scholastic dishonesty:
http://www1.umn.edu/oscai/integrity/student/index.html. If you have additional
questions, please clarify with your instructor for the course. Your instructor can respond
to your specific questions regarding what would constitute scholastic dishonesty in the
context of a particular class-e.g., whether collaboration on assignments is permitted,
requirements and methods for citing sources, if electronic aids are permitted or prohibited
during an exam.
I. Makeup Work for Legitimate Absences:
Students will not be penalized for absence during the semester due to unavoidable or
legitimate circumstances. Such circumstances include verified illness, participation in
intercollegiate athletic events, subpoenas, jury duty, military service, bereavement, and
religious observances. Such circumstances do not include voting in local, state, or
national elections. For complete information, please see:
http://policy.umn.edu/Policies/Education/Education/MAKEUPWORK.html.
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J. Appropriate Student Use of Class Notes and Course Materials:
Taking notes is a means of recording information but more importantly of personally
absorbing and integrating the educational experience. However, broadly disseminating
class notes or exams beyond the classroom community or accepting compensation for
taking and distributing classroom notes or exams undermines instructor interests in their
intellectual work product while not substantially furthering instructor and student
interests in effective learning. Such actions violate shared norms and standards of the
academic community. For additional information, please see:
http://policy.umn.edu/Policies/Education/Education/STUDENTRESP.html.
K. Sexual Harassment
"Sexual harassment" means unwelcome sexual advances, requests for sexual favors,
and/or other verbal or physical conduct of a sexual nature. Such conduct has the purpose
or effect of unreasonably interfering with an individual's work or academic performance
or creating an intimidating, hostile, or offensive working or academic environment in any
University activity or program. Such behavior is not acceptable in the University setting.
For additional information, please consult Board of Regents Policy:
http://regents.umn.edu/sites/default/files/policies/SexHarassment.pdf
L. Equity, Diversity, Equal Opportunity, and Affirmative Action:
The University will provide equal access to and opportunity in its programs and facilities,
without regard to race, color, creed, religion, national origin, gender, age, marital status,
disability, public assistance status, veteran status, sexual orientation, gender identity, or
gender expression. For more information, please consult Board of Regents Policy:
http://regents.umn.edu/sites/default/files/policies/Equity_Diversity_EO_AA.pdf.
M. Disability Accommodations:
The University is committed to providing quality education to all students regardless of
ability. Determining appropriate disability accommodations is a collaborative process.
You as a student must register with Disability Services and provide documentation of
your disability. The course instructor must provide information regarding a course's
content, methods, and essential components. The combination of this information will be
used by Disability Services to determine appropriate accommodations for a particular
student in a particular course. For more information, please reference Disability Services:
http://ds.umn.edu/student-services.html.
N. Mental Health and Stress Management:
As a student you may experience a range of issues that can cause barriers to learning,
such as strained relationships, increased anxiety, alcohol/drug problems, feeling down,
difficulty concentrating and/or lack of motivation. These mental health concerns or
stressful events may lead to diminished academic performance and may reduce your
ability to participate in daily activities. University of Minnesota services are available to
assist you. You can learn more about the broad range of confidential mental health
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services available on campus via the Student Mental Health Website:
http://www.mentalhealth.umn.edu.
O. Academic Freedom and Responsibility
Academic freedom is a cornerstone of the University. Within the scope and content of the
course as defined by the instructor, it includes the freedom to discuss relevant matters in
the classroom. Along with this freedom comes responsibility. Students are encouraged to
develop the capacity for critical judgment and to engage in a sustained and independent
search for truth. Students are free to take reasoned exception to the views offered in any
course of study and to reserve judgment about matters of opinion, but they are
responsible for learning the content of any course of study for which they are enrolled.*
Reports of concerns about academic freedom are taken seriously, and there are
individuals and offices available for help. Contact the instructor, your adviser, the
associate dean of the college, or the Vice Provost for Faculty and Academic Affairs in the
Office of the Provost.
* Language adapted from the American Association of University Professors "Joint
Statement on Rights and Freedoms of Students".
IV. Course Outline
1/20 Introduction to the Course
A. The Operating Budget
1/22 How Does One Budget in the Public and Nonprofit Sectors?
Read: Bland, B. (2011). Getting Hooked on Budgeting (Really), International
City/County Management Association, 1.
Read: Coe, C. K. (2007). Chapter 3 - Budgeting, Governmental and Nonprofit
Financial Management, Vienna, VA: Management Concepts, 47-102.
Prepare Problems: 2, 4, 6, 11, & 12 from Coe
1/25 How Do You Forecast Revenue in an Operating Budget?
Read: McKinney, J. B. (2004). Chapter 4 – Revenue Management. Effective
Financial Management in Public and Nonprofit Organizations,
Westport, CT: Praeger Publishers, 127-165.
Review 2016 State of MN Revenue Forecast and answer the separate questions.
1/27 How Do You Forecast Expenditures in an Operating Budget?
Read: McKinney, J. B. (2004). Chapter 10 – Expenditure Forecasting. Effective
Financial Management in Public and Nonprofit Organizations,
Westport, CT: Praeger Publishers, 296-314.
Prepare Case: Minneapolis Library Financial Consolidation and answer the
questions within the case study.
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1/29 How Is the Operating Budget a Management Tool?
Read: Bland, R. L. (2007). Chapter 3 – Managing Budget Deliberations, A
Budgeting Guide for Local Government (2nd Edition), Washington, DC:
International City Manager’s Association, 149-174.
Read: Smith, K. & Thompson, F. (2010). Budgets? We Don’t Need No Stinkin’
Budgets: Ten Things We Think We Think We Know about Budgets and
Performance, Center for Governance and Public Policy Research,
Willamette University, OR.
Prepare Case: The Theater Budget and answer the separate questions.
2/1 Which Decision Tools Does One Use for Budget Analysis?
Read: Michel, R. G. (2001). Introduction and Chapter Two - Basic Decision Tools,
Decision Tools for Budgetary Analysis, Chicago, IL: Government Finance officers,
1-24.
Prepare Case: Daycare Comes to Northville and answer questions within case.
2/3 How Should a Leader Use Budget Performance Information?
Read: Kelly, J. M., & Rivenbark, W. C. (2003). Chapter 5 - Performance
Measurement in Performance Budgeting for State and Local
Government, Armonk, NY: M.E. Sharpe, Inc., 121-153.
Optional Read: Hatry, H. & Davies, E. (2011). A Guide to Data-Driven
Performance Reviews, Improving Performance Series, Urban Institute.
Review “Results Minneapolis Police” October 2013 and answer questions.
Prepare Case: A Career Manager and the Budget Process and answer the questions.
2/5 What is Performance Management in the Federal Government?
Read: U. S. Executive Office of the President of Management and Budget (2013).
Strategic plans, annual performance plans, performance reviews, and
annual program performance reports, Executive Summary.
Optional Read: Zients, J. D. (2009). Testimony Before the Budget Committee,
United States Senate, October 29, 2009.
Prepare Case: City Council Hearings in Orsan, Orewash (A) and answer the
questions.
2/8 How Does One Use Advanced Budget Tools?
Read: Michel, R. G. (2001). Chapters Three – Advanced Decision Tools, Decision
Tools for Budgetary Analysis, Chicago, IL: Government Finance
Officers Association, 25-88.
Prepare Case and Template: Costs and Constraints in the Arizona Inmate Medical
Transport System and answer the questions.
2/10 How Is the Budget Finalized?
Read: Lee, R. D., Johnson, R. W., & Joyce, P. G. (2008). Chapter 7: Budget
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Preparation: The Decision Process, Public Budgeting Systems, Sudbury, MA: Jones
and Bartlett Publishers, 187-244.
Prepare Case: Implementing Budget Cuts in the Basic Health Plan: A Case Study
and answer the questions at the end.
B. The Capital Budget
2/12 How Does One Calculate Net Present Value?
Read: Time Value of Money Overview
Prepare Problems 9-1, 9-3, 9-6, 9-12, 9-13, 9-22, 9-26, & 9-35
2/15 How Does One Develop a Capital Budget?
Read: Bland, R. L. (2007). Chapter 7 – Planning and Budgeting for Capital
Improvements, A Budgeting Guide for Local Government (2nd Edition),
Washington, DC: International City Manager’s Association, 149-174.
Answer Questions on Capital Budget
2/17 How Does One Do Capital Budgeting in a State?
Read the 2016 Minnesota Capital Budget and answer the questions.
2/19 Exam 4-6:00
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