Atlanta City recently approved a budget of $648.6 million for the fiscal year 2018 in which it is indicated that the minimum wage is increased to $13 per hour. In contrast, Georgia has a much-extensive budget of $26 billion for the current fiscal year (Atlanta City Council, 2018). Moreover, $15.5 per hour is set as the minimum wage for employees in Georgia. Georgia has a larger share of the federal budget each year. Nevertheless, it has also been observed that apart from the changes in the total value of the budget, the governments of Atlanta and Georgia allocate the budget in the field of education, healthcare, utilities, supplies, pensions, infrastructure, and tourism development, etc. (Butler, 2018).
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The fiscal budgets of Atlanta and Georgia are consistent with the federal budget as the federal government also allocates a budget for education, utilities, supplies, and healthcare. However, the major difference between the federal budget and state budget is that the federal budget applies to the entire country, whereas Atlanta/Georgia budget applies to a single state. Unlike the budget system of Atlanta/Georgia, the federal government’s budget is required to follow certain rules to propose or implement the budget, for example, the resident initially submits the budget request to the Congress, and the House and Senate creates subcommittees, which make use of the stated tools to allocate the budget to US states.
On the other hand, it is also evident that there are certain tools and techniques which are used by the government to formulate the budget. These tools include the revenue and spending projection tool, consensus-revenue forecast tool, pear budget tool, and GNU Cash tool to propose and allocate the budget. The main purpose of the selected budget tools and techniques is to find out the funding required by each state and city in the fiscal year.
Weimer and Vining (2017) while explaining the budget allocation system indicated that market inefficiencies play a significant role in the budget system in Atlanta and Georgia. Market inefficiency occurs when the current prices fail to comply with the demand and supply of goods and services in society. Therefore, if the market is in a poor condition, then the government is required to develop a feasible budget which tends to increase the efficiency of the market. However, it is also notable that in the case of market inefficiencies, reserve funds can be used by the governments of Georgia and Atlanta when the regular income decreases or disrupts due to market inefficiency and failure (Weimer & Vining, 2017). It has been discussed that market inefficiencies can hurt the government’s spending and overall budget system. As a result, the government is required to make use of Rainy Day Funds to ensure that the fluctuations in the market do not affect the operations of governmental offices and other public institutions. In my opinion, the Federal Government can also make use of a similar process to utilize Rainy Day Funds to make sure that its education, healthcare, and other programs continue to execute suitably in the event of a market failure.
It could be concluded that the budget system is excessively important for all cities and states in the country. For this reason, the Federal government develops and allocates a budget by using several tools. It has also been assessed that to reduce the negative impact of market inefficiency, the government of Georgia and Atlanta must develop a rule similar to Rainy Day Funds to ensure the endurance of operations within the states.
Atlanta City Council. (2018). Atlanta City Council approves fiscal year 2018 budget. Web.
Butler, T. S. (2018). Overview of Georgia’s 2019 fiscal year budget. Web.
Weimer, D. L., & Vining, A. R. (2017). Policy analysis: Concepts and practice (6th ed.). New York, NY: Routledge.