Does Agency Autonomy Foster Public Participation (pages 64–74)
Competing Incentives in the Budget Process
Competing considerations are likely to be present when public Citizens, however, lack specialized policy knowledge or budget managers allocate public monies: the budget process involves sorting expertise. Th ey might even be reluctant to devote time and eff ort to out competing claims for limited public resources, and thus there
understand the policy implications of budget options or learn the are inherent trade-off s. To put it another way, budgeting determines language of fi nancial management. Th e chronic low attendance at which programs will be funded and to what extent, and as such, it
public hearings is an indication of such reluctance on the part of inevitably makes winners and losers of some policy constituents.
the public. Besides the cost imposed on participants, there are also Moreover, the allocation decisions should square with compet-
administrative costs associated with public participation (Ebdon ing values within the public managers’ realm, values coming from
and Franklin 2006; Irvin and Stansbury 2004; Robbins, Simonsen, both bureaucratic and democratic ethos. Th e process should be
and Feldman 2008; Th omas 1995). Participation has the poten- concluded at a minimal cost, as required by the values of effi ciency
tial to slow down decision making because the public needs to be and bureaucratic rationality, and should refl ect public preferences,
informed and even educated fi rst in order to meaningfully partici- as required by the values of democratic governance. Supposedly,
pate in the budget process. Organizing public forums is a resource- with public input, agencies’ allocation decisions would better refl ect consuming exercise in terms of both time and money. As Irvin citizen preferences. As Anderson and Smirnova (2006) note, public
and Stansbury put it, “the per-decision cost of citizen participation budgeting is simultaneously an economic instrument that is used for groups is arguably more expensive than the decision making done fi nancial planning purposes and a political instrument that should
by a single administrator” (2004, 58) with the appropriate expertise refl ect the particularities of the political environment. In sum,
and experience. Th ere are concerns that administrators might lose during the process of public budgeting, managers need to tackle
control over the process (Kweit and Kweit 1984; Moynihan 2003)
Does Agency Autonomy Foster Public Participation? 65
66 Public Administration Review • January | February 2014
Indeed, when an agency enjoys greater autonomy, its managers face strong incentives to go beyond the values of bureaucratic ethos. Administrators will be strongly motivated to reach out to the public as a means to validate their decisions in terms of both practicality and legitimacy. Involving the public can also increase compliance with rules and regulations. Nabatchi (2010) argues that citizen participation is associated with various types of benefi ts: (1) norma- tive (or intrinsic) benefi ts, meaning that it has value in and of itself, regardless of outcomes; (2) instrumental benefi ts for citizens, that is, educational and empowering eff ects through increased knowl- edge of the policy process and the development of citizenship skills and dispositions; (3) instrumental benefi ts for communities, such as capacity building within the community; and (4) instrumental benefi ts for policy and governance. In a study on participatory budgeting, Ebdon and Franklin (2006) point out that the benefi ts from participation range from sharing information with the public and educating citizens about budget complexity to gaining input for administrative decision making and enhancing the public’s trust in government. Engaging citizens in the resource-allocation process might alleviate antigovernment sentiment and cynicism among citizens (Berman 1997; Ebdon and Franklin 2006) and help citizens develop greater appreciation for the job of public administrators (Ho and Coates 2006).
Extant research also relates public participation to better policy outcomes (Fung 2004; Fung and Wright 2001; Guo and Neshkova 2013; Moynihan 2003; Neshkova and Guo 2012; Roberts 1997;
Sirianni 2009). Citizens possess practical knowledge and local experience and thus can provide public managers with context- specifi c information that might not otherwise
be available. Fung argues that the diversity of policy environments requires the use of context-specifi c means to achieve broad public goals: “Such variation makes it diffi cult for
a centralized body of experts or managers to accurately specify a uniform asset of tasks or procedures that will eff ectively advance even the most general of public ends” (2004, 18). Based on their local knowledge, citizens can also warn administrators about some unintended consequences of policy decisions and thus prevent costly errors. Moreover, citizens can off er “innovative solutions to public problems that would have not emerged from traditional modes of decision making” (Moynihan 2003, 174; see also Fung and Wright 2001 for an earlier version of this argument). Broad public support for agency actions also means greater societal acceptance of administrative decisions.
In sum, there are two competing hypotheses about the behavior of public managers in agencies with more autonomous budget proc- esses. Th e fi rst hypothesis expects that when given greater discretion, administrators will be more likely to rely on the traditional modus operandi and their technocratic expertise rather than seek citizen input on budget issues. A contrary perspective, derived from the par- ticipatory budgeting literature, expects that greater discretion comes with greater need for accountability, and thus administrators will be more likely to invite public comment as a means of increasing the legitimacy of agency actions and securing the support of critical con- stituency. In addition, involving the public can improve compliance rates and enhance the quality of administrative decision making.
and powerful interest groups might take over. Th e participatory budgeting literature also warns that citizens who are most active often represent private interests that might be very diff erent from the broad public interest (Ebdon and Franklin 2004; Landre and Knuth 1993; Robbins, Simonsen, and Feldman 2008).
Budget Autonomy and Participation
Broadly defi ned, budget autonomy denotes the independence of
a lower-level unit from higher-level authorities in determining its revenues and expenses. In the case of state and local governments, autonomy can only be understood in relative terms because their budgets need to be approved by legislative bodies. Th e more discre- tion is left to governments in the budget process, the more control they have when performing various budgetary activities.
Given the long-standing reliance of public administrators on the values of technical rationality and the presence of various costs associated with public participation, it seems likely that managers in agencies with greater budget autonomy would rather rely on their own expertise to decide on how to allocate public resources than wait for citizens to reveal their spending preferences in the resource- consuming process of public participation.
On the contrary, the literature on participatory budgeting at the local level clearly associates the degree of budget autonomy with public participation (e.g., Fung and Wright 2001; Krenjova and Raudla 2013; Santos 1998). On the one hand, fi scal autonomy is viewed as an enabling condition that facili- tates the process of participation. As Krenjova and Raudla contend, a certain degree of autonomy is needed “in order to make any form of PB [participatory budgeting] con- ceivable” (2013, 27). Clearly, governments with more self-generated revenue will have greater amounts for discretionary spending compared to governments that rely more on external transfers, which often have restraints attached to them. Describing in detail the participatory budgeting experiment in the city of Porto Alegre in Brazil, Santos points out that “[g]iven the dependence of the municipal budget on federal transfers, an exogenously generated fi scal crisis may endanger the sustainability of the PB by undermining its capacity to deliver in
a context of growing popular demands and expectations” (1998, 506). A study drawing on data from German municipalities fi nds that people are more likely to participate and have greater demands for effi ciency in service provision if local governments enjoy greater fi scal autonomy, measured as the amount of generated own-source revenues (Geys, Heinemann, and Kalb 2010).
On the other hand, the participatory budgeting literature stresses the need for political will on the part of the government to open space for public participation (Baiocchi 2003; Fung and Wright 2001; Postigo 2011; Santos 1998). If budget autonomy creates the possibil- ity for such space, public managers play an important role in making participation happen. Santos (1998) emphasizes the willingness of municipal administration to cogovern with the communities in the case of Porto Alegre. In her book on municipal budgeting, Rubin (1998) observes that during the last few decades, public offi cials have generally become more open to citizen input in the budget process.
Citizens possess practical knowledge and local experience and thus can provide public managers with context-specifi c information that might not otherwise be available.
Budgeting in the States
funding varies over time and often comes with restrictions on how Public budgeting at the state level exhibits some unique char-
the monies can be spent. In sum, state agencies diff er considerably in acteristics that make it diff erent from both the federal and local
their budgetary practices, and various constellations aff ect the amount levels. Comparing the levels of government and power distribution
of spending discretion and control exercised by agencies. between the executive and legislature, Th urmaier observes that “[r]elative executive infl uence ranges from formidable executive
Methodology
dominance of the process at the local-government level to a more
Data
equalized level of infl uence at the national level, with state-level Th e study utilizes both subjective and objective data from two state- budgeting in between depending on the budget process and the
level agencies—departments of transportation (DOTs) and depart- line-item veto powers of the governors” (1995, 449). Governors
ments of environmental protection 3 across all 50 states. Th e survey commonly have stronger veto power than the U.S. president, as
data used here were collected as part of the 2005 Government they can veto parts of a bill instead of just accepting or rejecting a
Performance Project (GPP). 4 Th e project started in 1998 with the bill in its entirety. Forty-three state governors have line-item vetoes
main objective to assess the performance of states. 5 Besides overall that allow them to block any expenses they disagree with that are
state governments, the project surveyed several state agencies. An listed as a separate line in the budget. Th irty-fi ve governors have the
online questionnaire was sent to state offi cials, administrators, and power to strike the budget of an entire program or agency (for an
managers. 6 Th e data on citizen input were collected within the in-depth discussion on how chief executives use their veto power,
fi nancial management section of the survey. Specifi cally, the data see Abney and Lauth 1985; Rubin 2010).
come from a subsection seeking information on whether the state/ agency provides opportunities for public input in the budget proc-
Th e structure of the budget process also varies signifi cantly from ess. Th e survey asks administrators to identify the strategies used by state to state. It depends on the level of centralization of budget
their agencies to generate input from citizens about spending priori- development, power distribution between the branches of govern-
ties, budget development, and assessment. 7 Th e survey responders ment, and degree of openness of decision making to the public
are given a matrix in which the rows are various participatory strate- (Rubin 2010). In most states, the governor dominates the budget
gies, including citizen surveys, budget simulations, focus groups, process, while in others, power is more balanced between the
open forums, public hearings, citizen advisory boards, and tel- executive and legislative branches. Th ere are few states in which the
ephone hotlines. Th ere is an option to write in a strategy that is not legislature is given signifi cant power over the budget formulation.
included on the list. Survey respondents are asked to select the strat- Yet scholars of budget politics agree that the executive branch tends
egies used by their agencies in relation to their usefulness in advanc- to dominate state budgeting at the expense of the legislative branch
ing the outcomes of the four stages of the budget process (given in (Rubin 2010; Th urmaier 1995). In fact, the executive budget move- the columns), 8 namely, (1) information sharing, (2) budget discus- ment of the twentieth century mostly aimed at strengthening the
sion, (3) budget decision, and (4) program assessment. Specifi cally, powers of governors (Clynch and Lauth 2006).
for the fi rst stage, respondents are invited to identify each strategy that “has advanced information sharing between citizens and agency
Th e budget cycle generally begins when agencies are called to submit offi cials.” For the second stage, they need to mark each strategy their requests for funding to the governor in accordance with his or
that “has advanced budget deliberations and discussions of budget her guidelines and recommendations. Upon receipt, the executive
trade-off s between citizens and agency offi cials.” For the third stage, budget offi
ce reviews the proposals and meets with agency heads to the survey inquires about strategies that have “provided information clarify the requests. 2 Legally, the executive budgets are the fi nancial
that agency offi cials use to make budget decisions.” For the last stage plans of the chief executives, and thus they should refl ect the gover-
of the budget process, the administrators need to select each strategy nor’s programmatic and political priorities. Governors can also modify that “has provided information that agency offi cials use to assess departmental requests after an initial review of their budget offi ces.
program results.” Table 1 shows the number of strategies found Evidence shows that governors trust state budget offi ces and adopt 95
useful by respondents at each stage of the budget process by agency percent of their funding recommendations (Th urmaier 1995).
type.
Executive budget offi ces are tasked with various functions, such as Th e GPP survey also collected information on the relative auton- developing revenue forecasts, caseload projections, predictions of state omy of state departments in performing their budgeting activities, business activities (NASBO 2008). Administrative agencies, in turn,
such as allotment control, forecasting authority, and development have varying degrees of autonomy from the executive budget offi
of multiyear plans. 9 For each activity, responders can choose the both the development and implementation phases of the budget proc- level of responsibility of their agency versus the state’s executive ess. Rubin (2010) identifi es two types of budget processes: bottom-
ce in
ce. Th e categories include primarily an executive budget up and top-down. In its most extreme form, top-down budgeting
budget offi
ce and 25 virtually ignores bureau heads, and agencies lack any autonomy in
offi
ce responsibility; 75 percent executive budget offi
percent agency responsibility; responsibility shared about equally; the budget process. “Th e chief executive may not ask bureau chiefs
ce and 75 percent agency respon- for their budget requests or may give them detailed instructions on
25 percent executive budget offi
sibility; and primarily agency responsibility. Th e GPP survey was how to formulate their requests” (Rubin 2010, 87). In bottom-up
sent to both state DOTs and state environmental agencies in the budgeting, agencies have much greater say in the process and are
same year, and each agency was asked to respond to all parts of the given greater responsibilities in the development and implementa-
survey, including the citizen input section and the section about tion of budgets. Finally, agency budget autonomy can be restricted by its relative autonomy from the state budget offi
ce in performing the amount of federal aid that the state receives; the available federal
budgeting activities. States that provided valid answers to both
Does Agency Autonomy Foster Public Participation? 67
Table 1 Number of State Agencies Utilizing Citizen Participation Strategies
developed by the International Association for Public Participation
a. Transportation
(IAP2). IAP2 ranks participation processes into fi ve stages of
Budget Process Stage
“increasing level of public impact”: inform, consult, involve, col-
laborate, and empower. Th e seven strategies listed in the GPP survey
Strategies
Sharing
Discussion Decision Assessment
question fi t into the three middle stages of the IAP2 classifi cation.
Telephone hotlines
Citizen/client surveys
21 12 17 21 Telephone hotlines and citizen surveys are categorized as processes
Focus groups
25 16 15 12 that seek to consult the public. Th e participatory mechanisms at
Open forum
Public hearings
26 17 18 17 this stage aim to “obtain public feedback on analysis, alternatives
Citizen advisory boards/
23 17 21 15 and/or decisions” (IAP2 2007). Yet telephone hotlines require less
commissions
eff ort from administrators than surveys because citizens initiate the
Budget simulation/contin-
“input” process by calling the agency. Th erefore, telephone hotlines
gent valuation
Other
21 12 17 21 assume a weight of 1. With citizen surveys (coded as 2), administra-
Note: The total number of responding state transportation agencies is 39.
tors need to initiate the process by designing and sending out the
questionnaires.
b. Environment
Budget Process Stage
Focus groups, open forums, public hearings, and budget simulations
with citizens can be classifi ed as processes that aim to involve the
Strategies
Sharing
Discussion Decision Assessment
18 2 6 14 public. According to IAP2 (2007), at this stage, administrators seek
Telephone hotlines
Citizen/client surveys
11 3 10 14 “to work directly with the public throughout the process to ensure
Focus groups
16 7 13 19 that public concerns and aspirations are consistently understood and
Open forum
17 6 13 20 considered.” Clearly, mechanisms involving two-way communica-
Public hearings
tion allow for better understanding of public preferences: citizens
Citizen advisory boards/
commissions
23 10 17 20 get to discuss policy issues with professional administrators and sort
Budget simulation/
out competing claims (Kathlene and Martin 1991; King, Feltey, and
contingent valuation
4 3 4 11 Susel 1998; Robbins, Simonsen, and Feldman 2008; Th omas 1995).
Other
9 4 5 11 In terms of weight, focus groups, open forums, and public hearings
Note: The total number of responding state environmental agencies is 39.
carry equal weight (coded as 3). Budget simulation exercises are assigned a higher weight (coded as 4) because they not only employ
questions constitute the cases used for this analysis. Specifi cally, 39 two-way communication but also make citizens aware of budget states provided information on their citizen participation practices
intricacies and trade-off s, and as such, they contribute to more (78 percent response rate), and 38 states responded to the questions
informed decisions on the part of citizens (Ebdon and Franklin about their autonomy in performing budgeting activities (76 per-
cent response rate). Yet some of the states that responded to the par- ticipation question failed to provide data on the autonomy question, Finally, citizen advisory boards or commissions are coded as proc- and vice versa, causing a drop in the number of useful observations
esses that collaborate with the public, and they are assigned the to 55 in the models using survey data. Th e study also utilizes data
highest weight (coded as 5) among the participatory mechanisms available from the National Association of State Budget Offi cers, the considered. Th e processes at this stage seek to “partner with the Environmental Council of the States, and other sources.
public in each aspect of the decision including the development of alternatives and the identifi cation of the preferred solution”
Dependent Variables
(IAP2 2007). Although citizen advisory boards can be very formal Th e dependent variables in this study are the measures of citizen
and ineff ective, research shows that members are likely to develop input, operationalized through two sets of indices based on the
extensive knowledge on policy issues and understand the multiplic- citizen participation practices provided in the GPP survey responses. ity of budget constraints and trade-off s faced by governments when Th e fi rst index is additive, and each strategy for collecting citizen
allocating scarce resources (Robbins, Simonsen, and Feldman 2008). input assumes the same weight. Th e strategies from all four budget stages are summed. In this way, each state agency receives an index
For both indices, higher values are associated with greater use of score for the whole budget process. Because there is no perfect
citizen input strategies by administrators in the budget process. method for obtaining citizen input (see, e.g., Ebdon and Franklin
Th e additive index ranges from 0 to 25, with a mean of 9.5 strate- 2004; Robbins, Simonsen, and Feldman 2008), public agencies are
gies per agency, while the range for the weighted index is from 0 to advised to employ a variety of methods. As Ebdon and Franklin
109, with a mean of 42.26. Also, the data show that, on average, argue, “Governments using more than one method on a regular
state DOTs employ a greater number of strategies compared to state basis might be more likely to attain eff ective participation by off set-
environmental agencies: 10.54 and 8.46, respectively. 10 ting the weaknesses of one method with the advantages of another” (2004, 35). Th us, summing the strategies for collecting citizen input Admittedly, there are several drawbacks of these indices as measures can serve as a useful proxy for the agencies’ outreach eff orts.
of citizen input. First, they refer to the quantity of strategies rather than to their quality; the indices do not refl ect the substantive value
To construct the second index, each participatory strategy is given of public comment or its practical applicability. Second, they do not
a diff erent weight based on the spectrum of public participation account for the intensity of use for diff erent strategies: the survey
68 Public Administration Review • January | February 2014 68 Public Administration Review • January | February 2014
Table 2 Descriptive Statistics for the Models
not how often. Th ird, the weighting mechanism ranks the strategies
Variables
Description
Mean SD Min. Max.
in terms of their expected impact, but it does not take into account
Dependent Variables
how well they were implemented in practice. Although limited, the
Citizen Participation
indices provide valuable insights about participatory practices at the
WEIGHTED INDEX Weighted index of citizen
state level and can serve as ordinal indicators of the degree of agency
participation
openness to the public.
ADDITIVE INDEX
Additive index of citizen
participation
Independent Variables
Key Explanatory Variables
Agency Autonomy
Th e key independent variables in this study are the measures of
ALLOTMENT
Degree of agency respon-
budgetary autonomy. Th e term refers to the degree of agency
CONTROL
sibility to allot funds
independence from the state executive budget offi 2 ce or federal
FORECASTING
Degree of agency respon-
AUTONOMY
sibility in developing
government. Th e independence of administrative agencies is only
spending forecasts
in relative terms, as their budgets need to be approved by the state
OWN SOURCE
Percent of agency own-
legislature and the budget offi
ce. Th e states vary considerably
REVENUE
source funds
in their budgetary practices and the limits put on the agencies’ Controls
BUDGET
Percent of agency budget
discretion. Such variation allows us to explore whether the degree
of the total state
of autonomy matters when public managers decide on the level of
budget
public participation.
EMPLOYEES
Percent of agency
employees to the total number of state
I consider three measures of agency autonomy. Th e fi rst two come
employees
from the GPP project and are more or less subjective, based on the
CONSTITUENT
Number of lobbying fi rms
perceptions of the survey respondents about the level of responsibil-
POWER
per state per industry
0.34 0.48 0 ity of their agencies in performing various budgeting activities. Th 1 e
MORALISTIC
Moralistic type of state
CULTURE
political culture
third measure, more objective, refl ects the percentage of an agency’s
INDIVIDUALISTIC
Individualistic type of
own-source revenue.
CULTURE
state political culture
TRADITIONALIS-
Traditionalistic type of
Th state political culture e fi rst two variables are related to specifi c budgeting activities performed by agencies, namely, the power to allot agency funds
TIC CULTURE
(Allotment Control) and the authority to develop spending forecasts (Forecasting Autonomy). 11 Th e measures refl ect the degree of agency
ce, then the variable is coded as –1. responsibility for these activities versus the executive budget offi ce. Budget autonomy takes a value of 0 if responsibility for allotment Allotment refers to the portion of an appropriation (the dollar
responsibility of the budget offi
control or spending forecasts is shared about equally between the amount authorized by the legislature) that may be expended or
ce. A value of 1 is assigned if encumbered during a given period (NASBO 2008). In most states,
agency and the executive budget offi
the particular budget activity is 75 percent agency responsibility. appropriations are not available for expenditure until they have been Finally, a value of 2 is assigned when the activity is primarily agency allotted. In other words, appropriations are made through budget
responsibility. Presented as percentages, the agencies forming the bills and translated into spending authority through the allotment
sample of this study have, on average, 56.6 percent of responsibility process. Moreover, expenditures cannot exceed allotments. An
for allotment control and 97.3 percent of responsibility for develop- appropriation may be obligated up to a greater amount but may
ing spending forecasts. Transportation agencies enjoy, on average, only be spent up to the allotted amount. Allotment control is an
slightly greater allotment autonomy (61.8 percent) than environ- integral part of the budget process, and responsibility for it can rest
mental agencies (51.3 percent). Th ere is practically no diff erence with either the executive budget offi
ce or the agency leadership, thus in the rate of forecasting autonomy between the two types of state aff ecting the level of agency autonomy. 12 Forecasting—an important agencies—96.7 percent for transportation and 97.9 percent for part of fi nancial planning—refers to the process of estimating the
environmental agencies.
amount of infl ows and outfl ows of the organization based on cur- rent law and the amount that will be available to support operating
Th e third measure of budget autonomy is the percentage of costs and capital outlays in the current and future fi scal years. Th e an agency’s own-source revenues (Own Source Revenue), which
authority to develop spending forecasts allows organizations to iden- refl ects the independence of state agencies from the federal gov- tify the areas of future shortfalls and arrange their resources in a way ernment. Because intergovernmental transfers often come with that will account for such events. When done properly, forecasting
strings attached, they place limits on state-level agency autonomy. can enhance fi scal stability and enable corrective actions as needed.
Moreover, the amount of federal aid varies over time, making this source of revenue less predictable and controllable. In the realm
Both variables, Allotment Control and Forecasting Autonomy, are of funding diversifi cation, it is crucial for agencies to have greater operationalized on a fi ve-point scale ranging from –2 to +2, from
resource independence. Own-source revenues of agencies come minimal to relatively full autonomy. Table 2 provides descriptive sta- from taxes, fees, service charges, permits, and licenses. Th us, the tistics for the variables used in the study. In terms of coding, if the
more funds an agency generates on its own, the greater the level budget activity is primarily an executive budget offi
of its spending discretion. 13 Th e variable is calculated by subtract- then the variable is coded as –2. If the budget activity is 75 percent
ce responsibility,
ing all federal aid. Th e data on the amount of intergovernmental
Does Agency Autonomy Foster Public Participation? 69 Does Agency Autonomy Foster Public Participation? 69
environmental agencies’ budget fi gures come from a report of the the Environmental Council of the States (2008). Th e agencies in
Environmental Council of the States (2008). the sample have, on average, 69.8 percent of their revenues coming from own sources. 14 In contrast to the fi rst two variables, environ-
Political environment can encourage the use of citizen input by mental agencies have slightly greater revenue autonomy than DOTs: setting the expectations toward public managers. Th e signals
70.9 percent and 68.8 percent, respectively. they receive regarding the role of citizens in government might
be aff ected by the broader political culture in the particular state It should be acknowledged that the three measures used here by
(Ebdon 2000 Elazar 1972; Lieske 1993; Lowery and Sigelman no means capture all diff erent aspects of budget autonomy and
1982). Elazar’s (1972) typology diff erentiates among three types represent only some of the possible operationalizations of such
of political subcultures: moralistic culture (found predominantly variables. 15 Th e fi rst two measures are perception-based and suff er
in the Northern states), individualistic culture (associated with from all of the drawbacks associated with survey data. In addition,
middle parts of the country), and traditionalistic culture (refl ecting they refl ect particular budgetary activities rather than the whole
the attitudes and values of Southern states). Participation is greatly budget process. Although not perfect, they are still useful proxies for encouraged within the political traditions of moralistic states; the degree of agency budget responsibility vis-à-vis the state budget
individualistic states stress less participation, as they tend to regard offi ce.
government more as business; and traditionalistic states employ a paternalistic approach, within which only elites are expected to be
Controls
active.
To isolate the eff ect of budgetary autonomy, I include a set of control variables in the models. Each control variable seeks to rule
Previous research has tested the eff ect of political culture in the out a possible alternative explanation about the level of citizen input context of city governments (Ebdon 2000; Ebdon and Franklin collected by administrative agencies.
2006) and fi nds that political cultures do aff ect the level of partici- pation, with moralistic states having the highest citizen involve-
As argued earlier, public participation in administration serves to ment, individualistic states having the lowest, and traditionalistic ensure the support of agency stakeholders, making constituency
states falling in the middle. To control for the eff ect of political power an important consideration when public managers decide
culture, I use three dichotomous variables derived from Elazar’s whether to involve the public and to what extent. Th e analysis of
typology: Moralistic Culture is coded as 1 for states with moralistic Yang and Pandey (2007) on state-level health and human serv-
political culture and 0 otherwise, Individualistic Culture has a value ice agencies demonstrates the importance of clientele infl uence,
of 1for states with individualistic political culture and 0 otherwise, recognizing that client groups can either support or undermine an
and Traditionalistic Culture is coded 1 for states with traditionalistic agency’s mission (see also Meier 2000). From a similar perspective,
political culture and 0 otherwise. To avoid perfect multicollinearity,
I exclude from the model Traditionalistic Culture, thus making it the the ordering of stakeholder relationships is a main predictor of how
a recent study by Handley and Howell-Moroney (2010) fi nds that
reference category.
bureaucrats exercise their discretion regarding the extent of citizen participation in administration. Th e authors argue that public man- Based on the participatory budgeting literature, I added a variable to agers make a greater eff ort to include the public if they feel greater
control for the eff ect of the agency size. Prior research reports that accountability to citizens in the community. Th us, I expect that a
agencies with greater manpower are more likely to invite participa- more powerful constituency will be associated with greater openness tion (Wang 2001). Th e variable is operationalized as the percent- of state agencies to the public. Although not perfect, the number of
age of agency employees to the total number of state employees organized interests in each state per policy area can serve as a good
(Employees).
proxy for their ability to mobilize and aff ect policy outcomes; 16 this
has been used in prior work on organized interests (e.g., Gray and
Estimation Routine
Lowery 1996; Gray et al. 2004). Th us, constituency power is opera- Two sets of models are estimated. An ordinary least squares regres- tionalized as the number of lobbyist organizations registered in each
sion model is used to estimate the equation using the weighted state by industry type (Constituent Power). I include all industry
index of citizen input as the dependent variable. Th e weighting areas corresponding to the two agencies of interest in the study. 17 mechanism makes the dependent variable an interval-level variable. When the additive citizen input is used as the dependent variable,
Th e amount of resources at an agency’s disposal is another factor
a negative binomial regression model is estimated. Recall that the believed to aff ect public managers’ decisions on the extent of public
additive index is just the count of citizen input strategies used by involvement. Seeking citizen input when making administrative
each state agency. A negative binomial model is preferred when the decisions is desired in democratic societies, yet it is also costly. Prior
assumptions of the Poisson distribution are violated and the mean research (Wang 2001) points to the need for suffi cient funding to
and the variance are not equal. Because the density of the mecha- ensure personnel and infrastructure needs associated with participa-
nisms used by public agencies to solicit citizen input does not meet tion. Th erefore, I expect that agencies with more resources will tend
the Poisson assumptions (the mean of the dependent variable is 9.5 to invite greater participation than agencies with scarce resources.
and the variance is 49.55), I estimate a negative binomial model. Th e share of an agency’s budget from the total state budget is used as an indicator of the relative resources that an agency has at its
Finally, because it is unlikely that the observations within one state disposal (Budget). Th e annual budget fi gures of DOTs are obtained
are independent, thus violating the independence assumption, the
70 Public Administration Review • January | February 2014
Table 3 Ordinary Least Squares Coeffi cients for Weighted Citizen Participation Table 4 Negative Binomial Coeffi cients for Additive Citizen Participation
Weighted Index of Citizen Participation
Additive Index of Citizen Participation
(2) (3) ALLOTMENT CONTROL
ALLOTMENT CONTROL
FORECASTING AUTONOMY
FORECASTING AUTONOMY
(0.247) OWN SOURCE REVENUE
OWN SOURCE REVENUE
(0.023) (0.019) CONSTITUENT POWER
CONSTITUENT POWER
(0.001) (0.001) MORALISTIC CULTURE
MORALISTIC CULTURE
(0.201) (0.183) INDIVIDUALISTIC CULTURE
INDIVIDUALISTIC CULTURE
–168.026 –212.828 Note: Models provide coeffi cients from ordinary least squares regression estima-
Adjusted R 2 0.131
25.22*** 35.67*** tion; robust clustered standard errors in parentheses.
Wald χ 2 19.97***
0.319 0.360 *p < .10; **p < .05; ***p < .01.
Alpha
Note: Models provide coeffi cients from negative binomial regression estimation; robust clustered standard errors in parentheses. *p < .10; **p < .05; ***p < .01.
models employ robust standard errors that allow for the observa- tions to be clustered within each state. 18 of the variables indicates that the type of agency autonomy under consideration is important.
Findings and Discussion
Th e results from the models are reported in tables 3 and 4. Diff erent Th e coeffi cients of the control variables are mostly intuitive. Th e operationalizations of the autonomy variable yield diff erent
coeffi cient on Constituent Power is positive and signifi cant. One role outcomes.
attributed to lobbyists is to channel information to policy makers, so more lobbyists groups are associated with higher public input
Note from column 1 that the coeffi cient of Allotment Control is posi- in the budgeting process. In other words, agencies with powerful tive and statistically signifi cant. Th is suggests that agencies with more constituencies are systematically more likely to invite greater public autonomy (measured as the power to allot funds) are more likely to
participation than those with less powerful constituencies, measured seek comment from the broad public. Th e weighted index is almost
as the number of lobbyist organizations registered in each state by
25 points higher for agencies with primary responsibility for the
industry type.
allotment of agency funds (value of +2) than for agencies in which the executive budget offi
ce controls allotments (value of –2). By con- Somewhat surprisingly, the coeffi cients of the agency’s resourceful- trast, the coeffi cient of Forecasting Autonomy in column 2 of table 3
ness (Budget) and its staff (Employees) are not signifi cant. Finally,
is negative and marginally signifi cant at the 10 percent level. Th ough political culture is an important determinant of the agencies’ deci- counterintuitive at fi rst, this result is consistent with the idea that
sion to “listen” to the general public. Th e positive and statistically the forecasting activity requires specialized knowledge and expertise
signifi cant coeffi cient of Moralistic Culture suggests that agencies to be conducted properly. Th us, agency independence in developing
in states with moralistic political culture are more likely to foster spending forecasts is not associated with a need for greater public
participation than agencies operating in traditionalistic political input. Finally, column 3 of table 3 uses Own
environment. Th e results confi rm by and Source Revenue as the main variable of interest.
large the expectations regarding the low Th e point estimate of the coeffi cient of this
level of participation utilized by agencies in variable is positive and signifi cant. Th erefore,
Overall, we could infer from
states with individualistic political culture. agencies with higher percentage of own
this analysis that agencies with
Despite the small number of observations, the revenues, rather than federal funds, are more
more control over their allot-
ment process and agencies that explanatory power of the models is reason-
likely to involve the general public. Overall, able, from .10 to .17. we could infer from this analysis that agencies
manage to generate more funds
with more control over their allotment process
Table 4 examines the hypothesis using the and agencies that manage to generate more
on their own are more likely to
additive index as a measure of public par- funds on their own are more likely to consider
consider public insights, while
the opposite holds true for fore- ticipation; because of the nature of this vari-
public insights, while the opposite holds true
able, the estimation technique is a negative for forecasting control. Th e diff erential eff ect
casting control.
binomial model. Th e results confi rm the
Does Agency Autonomy Foster Public Participation? 71 Does Agency Autonomy Foster Public Participation? 71
tors face strong incentives to pursue more inclusive approaches, even participation in the budget process increases with the agency’s
at the expense of effi ciency. Being an unelected branch, bureaucrats autonomy, operationalized by the amount of appropriation that
are often blamed for being unresponsive to the public interest. Th us, may be expended or encumbered during a given period. By contrast, the inclusion of the public can potentially increase the legitimacy of column 2 of table 4 suggests that agencies with more autonomy in
agency decisions and ensure the support of critical stakeholders. their forecasting activities are less likely to seek input from the pub- lic. Th e coeffi cient of Forecasting Autonomy is negative and signifi -
Th e evidence presented here suggests that considerations of demo- cant at the 5 percent level. Th ese insights derived from the earlier set cratic legitimacy play a considerable role in public managers’ deci- of models are also confi rmed when I use Own
sion making: agencies with greater autonomy Source Revenue as a measure of agency’s auton-
(measured in terms of allotment control and omy. Th e coeffi cient of the variable remains
own-source revenues) are more likely to seek positive and signifi cant as shown in column
Th e evidence presented here
suggests that considerations
public input to inform their budget decisions.
Th is means that when given greater budget- control variables observed with the weighted
3 of the table. Furthermore, the eff ects of the
of democratic legitimacy play
ary discretion, managers would rather reach index remain qualitatively unchanged.
a considerable role in public
managers’ decision making:
out to an agency’s constituency than rely only on administrative expertise. More autonomy
agencies with greater autonomy comes with greater responsibility on the part
I also estimate a number of additional models
of public agencies, and their managers are First, I examine whether the balance of power
to rule out other plausible explanations. 19 (measured in terms of allot-
willing to go the extra mile to ensure that between the legislative and executive branches
ment control and own-source
revenues) are more likely to seek they have the support of the public. Th is is
in the budget process aff ects the relationship
not the case, however, if budgetary autonomy of interest here. NASBO provides yearly data
public input to inform their
is operationalized in terms of forecasting. on gubernatorial budget authority, including
budget decisions.
Conducting forecasting analyses requires the governor’s veto power, yet none of the
technical expertise and preparation to be indicators associated with a strong executive achieves signifi cance in
tackled properly. In fact, administrators are less likely to seek public the models. Second, one could argue that budgetary autonomy and
input if they enjoy greater independence from politics in estimating public participation are consequences of a managerial reform that
their future spending. Hence, agency autonomy can foster public grants agencies more responsibilities to meet citizens’ need (such
participation, but only if agencies are delegated greater autonomy need is better identifi ed through engaging the public directly). A
to decide on the allotment of the appropriated agency funds and if study by Lu, Willoughby, and Arnett (2011) reports data on the
they generate more funds on their own. Th ese fi ndings are consist- comprehensiveness of budgeting for performance reforms and ranks
ent with previous work by Th omas (1990, 1993, 1995), who argues the states in terms of the relative strength of their reform eff orts.
that the appropriateness of public participation in administration Th e results from the additional models fail to register any signifi cant diff ers depending on the need for quality and acceptability of agen- eff ect of the reforms on the relationships of interest here. Th ird,
cy’s decisions. Decisions on how taxpayers’ money should be spent because some states place greater emphasis on participation at the
require a high degree of public acceptance. In contrast, developing local level, I run an additional model to check for this eff ect. Berner
spending forecasts necessitates a higher degree of quality, and thus and Smith (2004) provide data on state requirements for participa-
public involvement is less appropriate.
tion at the county and city levels. Th e estimations show that citizen participation requirements at the local level do not signifi cantly
Th e results of this study have important implications for the design aff ect the amount of participation invited at state agencies. Fourth, I of state budget processes and the desirability of having more auton- test the robustness of the results against population size. Th e variable omous agencies. Th e fi nding that more autonomous agencies are is only marginally signifi cant and does not impact the major eff ects
generally more likely to seek public input in their budget processes registered under the original models. Finally, I employ a set of
means that state legislatures and governors should not be fearful that alternative variables to model the eff ect of political environment in
granting autonomy to agencies will make them run amok or lead to states, including a nominate measure of government ideology (Berry less participation and buy-in from the public. Just the opposite, hav- et al. 2010), as well as measures such as divided government and
ing greater budget autonomy comes with more responsibilities for two-party vote shares (Council of State Governments 2005). None
public managers and greater willingness to stay in tune with public of those new variables signifi cantly improves the models’ goodness
preferences.
of fi t or changes the inferences drawn under the original models. Future research should extend the investigation to other policy
Conclusion
areas and check whether the inferences registered here for trans- Agencies with greater autonomy in their budget processes face
portation and environmental protection departments hold in other confl icting incentives. On the one hand, independence from the
policy contexts. Both types of agencies included in this analysis executive allows agency management to deploy a strictly techno-
need to comply with federal requirements for public participation cratic and effi cient mode of operation that relies on the agency’s
set by legislative acts such as ISTEA and NEPA. Admittedly, there expertise and experience. Given the long-standing reliance of public
are legal requirements for public inclusion in many policy areas, administration on the values of bureaucratic ethos, it seems plausi-
but they can be met in a meaningful way or just as a formality. In ble that agencies would invoke instrumental rationality and ignore
this sense, future research should devote more attention to better
72 Public Administration Review • January | February 2014 72 Public Administration Review • January | February 2014
11. I initially considered one more operationalization of budget autonomy based
public input in situations in which competing incentives are likely
on agency authority to develop multiyear programs. Yet this measure has been
to be at play. Because the decisions about the forms and extent of
dropped from the analysis because of the lack of variation within it.
public participation reside solely with the administrators, it is of
12. It should be noted that in times of unanticipated revenue shortfalls, it is not
crucial importance to examine under what conditions they would
unusual for the executive to reduce allotments across the board to all state agen-
opt for meaningful participation. Are these decisions aff ected by
cies. Th
e executive may also reduce allotments for a specifi c agency for a variety
the values held by individual administrators? Or are they infl uenced
of reasons, for example, if the agency is overspending and the executive wants to
by the values shared within their respective agencies? In a sense,
reduce its autonomy.
both quantitative and qualitative studies are needed to prove the
13. I recognize that there might be important distinctions in the types of own-source
generalizability of these fi ndings and to better understand the causal
revenue; for example, agencies that utilize large amounts of general state income/
explanations behind statistical associations.