Applying Public Finance Concepts to Texas Agencies
Walden University · College of Health Sciences and Public Policy
Theories and Concepts to Help Understand Budgeting and Finance
Week 1 Application Essay: apply finance and budgeting theory to a Texas public organization you know well.
Module: Week 1
Type: Application Essay
Length: 2 pages
01Context and Overview
Walden University students in PPPA 8431, Finance and Budgeting for the Public Sector, begin this Application Essay by looking at why fiscal skill sits at the center of public administration. People sometimes treat finance as intimidating, but the money side of government decides which programs run and which stall. Sixteen of the thirty largest spending organizations in the United States are government agencies, so administrators who cannot read a budget cannot fully do their jobs.
The three traditional sectors of the U.S. economy, meaning government, non-profit organizations, and for-profit firms, share many financial functions such as strategic planning, accounting, and reporting. Public organizations differ in one respect that shapes everything: they answer to citizens, and often to higher levels of government as well. That accountability pulls two sets of stakeholders directly into the budget process. This week you examine budget and finance concepts, apply them to a public organization you know, and consider how government budgets shift depending on whether the agency sits at the federal, state, or local level.
02Assignment Instructions
Write a two-page Application Essay that works through the four tasks below in order. Treat the paper as a short analytical piece rather than a personal reflection; ground each claim in the Learning Resources.
- Consider how finance and budgeting theories and concepts apply to a specific public organization.
- Construct a brief description of a government organization within Texas that you know from work, study, or the media.
- Explain how you would apply at least two basic finance or budgeting concepts or theories to that organization.
- Provide a short definition of each concept or theory, then give a specific example of how it plays out in the agency.
What “specific” looks like
A vague answer names a theory and stops. A graded-A answer says which line of the agency’s budget, which revenue stream, or which reporting requirement the theory explains. If you choose incrementalism, point to how last year’s appropriation anchored this year’s request. If you choose fiscal federalism, name the federal grant the agency depends on.
03Requirements and Formatting
- Length: 2 pages of body text, double-spaced, excluding the title page and reference list.
- Structure: brief introduction, organization description, application of two concepts with examples, short conclusion.
- Sources: cite at least two of the week’s Learning Resources; peer-reviewed or government sources strengthen the work.
- Format: APA 7th edition throughout, including title page, in-text citations, and references.
- Voice: formal, third person, evidence-based; define specialist terms the first time they appear.
- Originality: submit through the Turnitin link; keep the similarity report within program limits.
04Grading Rubric and Marking Criteria
| Criterion | Proficient expectations | Points |
|---|---|---|
| Organization description | Names a real Texas government organization and describes its mission, level of government, and funding base clearly and concisely. | 20 |
| Application of two concepts | Applies at least two finance or budgeting theories to the agency with logical, well-reasoned links to its operations. | 30 |
| Definition of concepts | Defines each concept accurately in the student’s own words and cites a supporting source for each. | 20 |
| Specific examples | Grounds each concept in a concrete, verifiable example drawn from the agency’s budget, revenue, or reporting. | 15 |
| Scholarly support | Integrates at least two Learning Resources; evidence supports rather than decorates the argument. | 10 |
| APA 7th and mechanics | Follows APA formatting, grammar, and academic tone with few errors. | 5 |
05Sample Answer Writing Help
Two Concepts at Work in TxDOT
The Texas Department of Transportation, known as TxDOT, plans, builds, and maintains the state highway system and reports to the Texas Legislature and the governor. Its finances show two budgeting concepts at work almost every biennium. Performance-based budgeting appears first: the Legislative Budget Board ties agency appropriations to measurable goals such as lane-miles maintained and project delivery times, so funding follows results rather than habit. The department must justify requests against those strategic targets, which pushes managers to defend spending in terms of outcomes citizens can see. Fiscal federalism appears second, because a large share of TxDOT’s construction dollars flows from the Federal Highway Administration under the federal-aid highway program. That intergovernmental transfer carries conditions, so a state agency ends up administering funds shaped by national policy priorities. The OECD’s review of budgeting and public expenditures across member states notes that linking money to performance targets is now standard practice in most advanced governments (OECD, 2019).
Both concepts help explain choices that look confusing from the outside. Performance-based budgeting clarifies why TxDOT publishes dashboards on pavement condition and congestion; those metrics feed directly back into the next appropriation cycle. Fiscal federalism explains why the agency cannot simply redirect highway trust funds to unrelated needs, since federal matching requirements bind the money to eligible projects. A public administrator who grasps these two ideas can read the agency’s Legislative Appropriations Request without getting lost. The example also shows the accountability that separates public finance from private finance, because citizens, legislators, and a federal partner all watch the same ledger (Mikesell, 2018). Incremental budgeting could serve as a third lens, since each biennial request tends to start from the prior base rather than a blank sheet. Choosing two concepts and defending them with agency-specific detail is what earns full marks on the application and definition criteria. The reasoning stays concrete, and every claim points back to a source.
Texas and the Biennial Ledger
The Texas budget cycle rewards students who look past the theory label and into the mechanics. Texas writes a two-year General Appropriations Act, so agencies plan on a biennial rhythm that magnifies the effect of any single funding decision. Rubin (2019) argues that budgeting is fundamentally political, and the Texas dual-budget structure, where both the Legislative Budget Board and the Governor’s Office prepare recommendations, illustrates that tension in practice. A dataset such as the LBB’s Fiscal Size-Up gives verifiable figures for agency appropriations, which turns a general claim into evidence a grader can check. Pulling one or two real numbers from that source lifts an essay from summary to analysis. The habit also builds a skill that transfers directly to public service, since practitioners defend budgets with data, not adjectives.
Which Budgeting Theory Best Fits a State Agency?
For most Texas state agencies, performance-based budgeting is the strongest fit because state law already requires strategic planning tied to measurable outcomes. The choice should follow the agency, not the other way around. A regulatory body with stable duties often runs on incrementalism, where each request nudges the prior base up or down. A capital-heavy agency like a water development board leans on fiscal federalism and debt financing, since large projects draw on grants and bonds. Weigh three questions before committing: does the agency deliver measurable services, does it depend on outside funding, and does its spending change sharply year to year? Match the theory to whichever pattern dominates, and the definition and example fall into place naturally.
Common Missteps in Concept Selection
Several errors cost students points every term, and most are avoidable. Writers often name a theory without defining it, which forfeits the definition criterion outright. Others pick a private-sector concept that ignores the citizen accountability at the heart of public finance. A few compare theories at length but never apply either one to the chosen agency. Watch for these traps as you draft:
- Selecting an organization you cannot describe with specifics, which leaves the example thin.
- Confusing zero-based and incremental budgeting; the first rebuilds from zero each cycle, the second adjusts the existing base.
- Citing the textbook once and then arguing from opinion, which weakens the scholarly-support score.
Fixing these before submission usually moves a paper a full letter grade. The clearest essays read like a short briefing to a supervisor who wants the point fast.
06Research, Writing, Citation & Referencing
Frameworks and standards to reference
- Incrementalism: Aaron Wildavsky’s account of budgets that grow from the prior base.
- Performance-based budgeting: funding tied to measurable outputs and outcomes, standard under the Texas strategic planning statute.
- Fiscal federalism: revenue and authority shared across federal, state, and local governments.
- GASB standards: the Governmental Accounting Standards Board rules that govern public financial reporting.
Which Texas government organization should I choose for this essay?
Pick an agency whose budget you can describe with real detail, such as the Texas Department of Transportation, a local independent school district, a city government, or the Texas Health and Human Services Commission. The best choice is one with public budget documents online, because verifiable revenue and spending figures let you build concrete examples and satisfy the specific-examples criterion. Avoid organizations you only know by name, since the description and application sections need substance a grader can trace to a source.
Why This Matters in Practice
Public administrators defend budgets in council chambers, legislative hearings, and grant reviews, where a shaky grasp of incrementalism or fiscal federalism shows immediately. Reading a Legislative Appropriations Request or a GASB-compliant financial statement is a daily task for finance officers, program directors, and city managers. The skill this essay builds, meaning connecting a theory to a real ledger, is the same skill that protects programs when revenue tightens.
07References and Learning Resources
- Khan, A., & Hildreth, W. B. (Eds.). (2018). Budget theory in the public sector. Routledge.
- Menifield, C. E. (2020). The basics of public budgeting and financial management: A handbook for academics and practitioners (4th ed.). Hamilton Books.
- Mikesell, J. L. (2018). Fiscal administration: Analysis and applications for the public sector (10th ed.). Cengage Learning.
- OECD. (2019). Budgeting and public expenditures in OECD countries 2019. OECD Publishing. https://doi.org/10.1787/9789264307957-en
- Rubin, I. S. (2019). The politics of public budgeting: Getting and spending, borrowing and balancing (9th ed.). CQ Press.
Coming Next: Week 2 Application
Revenue Systems and the Public Budget Cycle (PPPA 8431, Week 2)
Week 2 shifts from theory to money coming in. You examine how public organizations raise revenue through taxes, fees, and intergovernmental transfers, and how those sources shape the budget cycle at federal, state, and local levels. In a 2- to 3-page Application Essay, identify the main revenue streams of the Texas organization you profiled in Week 1, and analyze how the mix of sources affects its budget stability and its accountability to citizens. Support the analysis with at least two Learning Resources in APA 7th format, and evaluate one revenue source using the criteria of equity, adequacy, and efficiency. Come prepared to compare your findings with peers on how revenue volatility influences service delivery.
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