University Public Budgeting, Revenue, and Expenditure Analysis Report

This report presents an analysis of public budgeting, revenue, and expenditure, focusing on a memorandum to the Secretary of the Department of Energy. The assignment involves evaluating different proposals for a discretionary spending program, including a baseline scenario and a counter-proposal, considering factors such as budget authority, spendout rates, and annual baseline inflation. The analysis includes detailed projections of spending over a ten-year period, comparing the financial implications of each proposal. The report highlights the potential cost savings of the counter-proposal and its impact on government revenue. The student's response includes a summary table and a detailed evaluation of the financial aspects of each proposal, providing insights into the most profitable approach for the government.

Running head: PUBLIC BUDGETING, REVENUE AND EXPENDITURE ANALYSIS
Public Budgeting, Revenue and Expenditure Analysis
Name of the Student:
Name of the University:
Author’s Note:
Course ID:

1PUBLIC BUDGETING, REVENUE AND EXPENDITURE ANALYSIS
Answer to Question 4:
Memorandum
To: The Secretary of the Department of Energy
From:
Date: 10/02/2019
Subject: Evaluation of the proposals under consideration
After consideration of all the possible aspects, it has been evaluated that the estimated
budget authority would increase by 2% each year owing to the annual baseline inflation. By
the end of 2029, the overall estimated budget authority would stand at $10,950. The main
change has been made in the prior year funds, while the total amount has remained the same.
This fund is necessary to be incurred for fulfilling the overall objectives. For funding the
project, the funds from the prior year would be used, which is $500. In 2019, the funds to be
generated would be $1,480. Hence, by taking into account all the aspects, the total amount
that is required to be incurred for the project is $11,726 for the ten-year period. This amount
is related to 50% cut in overall spending.
In this context, it is noteworthy to mention that capital investment helps the
government agencies in analyzing the potential profit margin of a long-term investment. The
following summary table is prepared for presenting the projections of spending:
Summary Table
Baseline 21,862 Proposal 12,400

2PUBLIC BUDGETING, REVENUE AND EXPENDITURE ANALYSIS
50% Cut 11,726 Counterproposa
l
6,693
10,136 5,708
The above table is prepared by considering a number of assumptions, in which the
outlay per year is estimated to change over the years. The main change has been made in the
prior year funds, while the total amount has remained the same. In case of the counter
proposal, the estimated spending rate is observed to decline over the years. There would be
no change in annual baseline inflation, since it would remain the same as 2%. However, there
would be significant decline in the estimated budget authority to $5,291 from the years 2020-
2029, which has been above $10,000 in the other two plans. This clearly implies the
possibility of minimizing significant amount of spending and as a result, the cash outflows
could be minimized largely.
The amount to be used from the prior-year funds would remain the same at $500, as
in the case of the two other proposals and the situation is similar in the current year as well.
However, considerable reduction could be observed in the cash outflows of the next years,
which is almost half of the amount estimated in the other two proposals. As a result, the total
baseline outlays would be $6,693 for the counter proposal, which is much lower in
comparison to the other two proposals. Therefore, by taking into consideration all the
identified facts and figures, it could be found that the counter proposal put forward is more
profitable for the government than the other two proposals in terms of spending. This is
because nearly half of the project budget would be saved for the government by adopting the
counter proposal and hence, the revenue expected to be generated would help in earning more
profit in future.

3PUBLIC BUDGETING, REVENUE AND EXPENDITURE ANALYSIS