Course Syllabus

O’Neill School of Public and Environmental Affairs

V186 Introduction to Public Budgeting and Finance (Section 37344)

Fall 2026

Instructor: Faisal Cheema, fscheema@iu.edu

Teaching Assistants: Josephine Wise, wisejos@iu.edu

Class Meeting: Monday and Wednesday: 5:30 pm – 6:45 pm, Geology Building (GEOL 1045)

Office Hours: Wednesday, 4:00 pm - 5:00 pm in Room SPEA 375C, or by appointment (please schedule your individual meeting with the instructor in advance)

Breaks & Holidays: Fall Break (Oct 09 - Oct 11); Thanksgiving Break Nov 22 – Nov 29

Course Description

The public and non-profit sectors play an important role in today's world. Together, they provide resources and produce goods and services that are crucial for a well-functioning society. However, fulfilling this role requires solid plans that encompass what will be produced, how it will be financed, and how it will be accounted for. This course explores these questions.

We first explore the budgetary process that governs spending (which public goods and services will be financed and provided). Next, we walk through the various revenue sources that are used by governments at different levels to finance these goods and services. Finally, we study the accounting documents that are used to record financial activities in the public and non-profit sectors. The course will use practical applications including real budgets, tax forms, and accounting documents to convey useful information to students. Comparisons to the for-profit sector are made throughout to emphasize some of the key features of the not-for-profit sectors.

Although this course mostly focuses on public finance in the context of the U.S. (at federal, state, and local levels), we will also discuss relevant international practices of taxation, budgeting, and debt management that will help us understand the most important theoretical principles of government budgeting and finance.

For students with majors in the O'Neill School, this course will set the stage for your undergraduate career. As a graduate of the O’Neill School, we expect every student to have a solid understating of how revenues are sourced and how expenditures are determined in the public and non-profit sectors. This course is the starting point for acquiring this knowledge, and it will play a critical role in your ability to succeed in upper-level courses.

Learning Outcomes

Students should be able to do the following at the end of this course:

Describe the role of the public sector and public goods.
Describe the budgetary process.
Identify and describe the main types of spending functions in the public and non-profit sectors.
Identify and describe the main revenue sources in the public and non-profit sectors.
Identify and distinguish between debt and deficit and explain when/why both are a reason for concern.
Identify and read public and non-profit sector financial documents.
Demonstrate an understanding of the basic tools of financial analysis.
Have a working knowledge of how to use spreadsheets.

How much time should you be spending on this class: If this is a standard 3-credit semester-length class, you are expected to spend an average of 6 or more hours outside of class per week on reading, studying, assignments, etc. If this is a 6- or 8-week 3-credit class, you are expected to spend at least 12 hours outside of class per week on these activities.

Learning Modules (see Modules in Canvas for more information)

Market Failure and the Role of the Public Sector (Week 1)
Tax Systems and Principles of Sound Tax Policy (Week 2)
Income Taxes (Week 2 & 3)
Consumption Taxes (Week 4)
Property Taxes, User Fees, Municipal Debt (Week 5)
Intergovernmental Fiscal Relations (Week 6)
Public Choice and Intro to Budgeting (Week 7)
Midterm Exam (Week 8)
Budgeting: Principles, Stages, and Policies (Week 9)
Federal Budget Process, Public Spending (Week 10)
Federal Debt and Deficit (Week 11)
State and Local Budgeting (Week 12)
Time Value of Money and Capital Budgeting (Week 13)
Accounting Standards (Week 14)
Analysis of Financial Statements (Week 15)
Final Exam (Week 16)

Required Text

Finkler, Steven A., Calabrese, Thad D., Smith, Daniel L. Financial Management for Public, Health, and Not-for-Profit Organizations, 7th Edition, E-text version. (Feel free to use the 7th Edition as well.)

I will be teaching this class with IU eTexts. Your copy is available on your Canvas class page. For more information and the Engage e-reader tutorial, I recommend you review The Student Guide to IU eTexts before the first day of class. If you have problems, please consult this Troubleshooting Guide.

Links to supplementary texts (e.g., from Brookings, Tax Policy Center, Tax Foundation) will be provided on a weekly basis.

Supplementary Text (not required)

Stiglitz, Joseph E., Rosengard, Jay K., Economics of the Public Sector, 4th Edition (or earlier editions).

This textbook may be used by advanced students interested in the economic theory of the public sector who have a sufficient background in microeconomics and experience in dealing with simple economic models.

Course Requirements and Policies

Your understanding of the course material will be evaluated via homework assignments (multiple-choice and essay questions), discussion forums, and two exams. Important announcements are distributed through Canvas and/or email. You should check your IU email and the Canvas inbox regularly.

Grading

Your final grade in the course will be based on:

Weekly homework assignments: worth 10% of your final grade.
Lab-Session Quizzes: worth 14% of your final grade
Discussion forums: worth 10% of your final grade.
Participation and attendance: worth 6% of your final grade.
Two exams worth 60% of your final grade:
1. Midterm Exam worth 30%.
2. Final Exam worth 30%.

If your score is		Your letter grade is
less than	but greater than or equal to	Your letter grade is
100%	97%	A+
97%	93%	A
93%	90%	A-
90%	87%	B+
87%	83%	B
83%	80%	B-
80%	77%	C+
77%	73%	C
73%	70%	C-
70%	67%	D+
67%	63%	D
63%	60%	D-
60%		F

Note: Small rounding will be used. If your final grade is within one-half of one percentage point below the next highest grade, it will be rounded up to the higher grade. For example, a final grade of 89.57% will be rounded up from B+ to A-. You can read more about IU’s grading policies here.

Attendance: Attendance will be taken in each class in TopHat. You are allowed three absences through the semester for any reason. After that, your attendance grade will be reduced by 0.5 percentage points for each additional absence (e.g., if you miss 5 classes, you can get a maximum of 4 points for attendance). There is an exception to this rule for any classes you miss due to COVID-19 or another illness. If you receive a positive COVID-19 test, I expect you to miss 1-2 classes (self-quarantine, isolation, etc.) without any penalty. Please contact me if that is the case and I will work with you to enable you to still participate in the class if isolation is required.

Modules: Each week's module will be published in Canvas on the Friday of the previous week. You can expect to see reading assignments, homework, and discussion forums in each module. Please read all instructions carefully and plan to spend at least six (6) hours a week studying the material provided.

Schedule of Assignments: Posted in the respective module of the course in Canvas. Weekly homework is due on Sunday, 11:59 pm.

Reading Assignments: Additional readings and/or videos will be posted on Canvas and will be strongly influenced by current events relevant to the course. They may be subject to change as the situation develops.

Late Assignments: All homework assignments must be submitted via Canvas. You may trade points for late submissions. Each hour that your assignment is late costs 5% of the grade for the assignment in question. For example, suppose assignment 1 is worth 100 points and you submit it 8 hours late. In this case, the maximum grade you can get on assignment 1 is (100 - 8*5%*100) = 60. If you need an extension due to illness or another reason, notify me in writing before the deadline.

Exam Dates:

Midterm: Wednesday, Oct 14, 5:30 pm –6.45 pm (in person, closed book. You will have 75 minutes to complete the exam)
Final: Tuesday, as per date and fixed by the school (in person, closed book. You will have 2 hours to complete the exam)

Make-Up Exams: Please plan your schedule around the exam dates. The possibility of a make-up exam will only be considered under extraordinary circumstances. The definition of an extraordinary circumstance is solely at the discretion of the instructor. If you feel you have an extraordinary circumstance for missing an exam and would like to take a make-up exam, then you must submit your request for a make-up exam in writing prior to the exam date. Your written request must be made before the day of the exam and must include supporting evidence.

Discussion Forums: Part of your grade (10%) will be assessed through your participation in three (3) discussion forums held throughout the semester. In each discussion forum, you will have to provide one (1) substantive comment on the readings and two (2) shorter comments on your colleagues’ responses. For details on the logistics of these forums and what is expected, visit About Discussion Forums in Canvas.

More on IU’s grading policies can be found here: https://policies.iu.edu/policies/aca-66-grades-and-grading/index.html.

Use of generative AI (such as ChatGPT) in this class. Using AI to assist in completing assignments will be allowed only in the following ways:

List acceptable uses here, e.g. “ChatGPT may be used to find sources.” OR “In Assignment x, will be using and citing ChatGPT as part of the assignment. See Assignment x for details.”

All other use of AI is prohibited. You are permitted to use the free version of Grammarly and Microsoft Word’s spelling and grammar tool.

If you use AI in an unauthorized manner, you will be committing plagiarism* and will be subject to penalties in this class and sanctions by Indiana University.

WARNING: Submitting any questions, assignments, notes, slides, or other instructor-produced course materials into Generative AI without permission is a violation of the faculty member’s exclusive rights and will be reported to the Dean of Students as academic misconduct.

*Plagiarism: Plagiarism is defined as presenting someone else’s work, including the work of other students, as one’s own. Any ideas or materials taken from another source for either written or oral use must be fully acknowledged, unless the information is common knowledge. https://studentcode.iu.edu/responsibilities/academic-misconduct.html. (emphasis added)

Academic Misconduct and General Academic Policies

Cheating and plagiarism are forms of academic dishonesty that cannot be tolerated in university education. Definitions of various types of academic misconduct and University policies for dealing with violations are included in the Code of Student Ethics. Any student found cheating or plagiarizing will receive a failing grade for the course.

Note Selling: Several commercial services have approached students regarding selling class notes/study guides to their classmates. Selling the instructor’s notes/study guides in this course is not permitted. Violations of this policy will be reported to the Dean of Students as academic misconduct (violation of course rules). Sanctions for academic misconduct may include a failing grade on the assignment for which the notes/study guides are being sold, a reduction in your final course grade, or a failing grade in the course, among other possibilities. Additionally, you should know that selling a faculty member’s notes/study guides individually or on behalf of one of these services using IU email, or via Canvas, may also constitute a violation of IU information technology and IU intellectual property policies; additional consequences may result.

Materials: The faculty member teaching this course holds the exclusive right to distribute, modify, post, and reproduce course materials, including all written materials, study guides, lectures, assignments, exercises, and exams. While you are permitted to take notes on the online materials and lectures posted for this course for your personal use, you are not permitted to repost in another forum, upload to AI, distribute, or reproduce content from this course, or sell the instructor’s course materials (including notes and study guides) without the express written permission of the faculty member.

Violations of this policy will be reported to the Dean of Students as academic misconduct (violation of course rules). Sanctions for academic misconduct may include a failing grade on the assignment for which the notes/study guides are being sold, a reduction in your final course grade, or a failing grade in the course, among other possibilities.

Additionally, you should know that selling a faculty member’s course using IU email, or via Canvas, may also constitute a violation of IU information technology and IU intellectual property policies; additional consequences may result.

O’Neill School of Public and Environmental Affairs, Student Honor Code

The O’Neill School takes matters of honesty and integrity seriously. We expect O’Neill

students will, at all times, maintain academic integrity and civil and professional standards of

conduct.

O’Neill’s Student Honor Code applies to all courses and programs offered by O’Neill, and to all students who participate in O’Neill classes and programs, regardless of whether students are admitted to O’Neill. Students studying at O’Neill are expected to continue their commitment to ethical behavior in all their endeavors, including, but not limited to, coursework inside and outside of O’Neill, internships, community service, and overseas study.

O’Neill’s Student Honor Code incorporates IU’s Code of Student Right, Responsibilities, & Conduct and extends to matters of civility and professional conduct, including, expectations about class attendance, punctuality, participation in class, and decorum in class and at other school functions.

O’Neill School expectations of civility and professional conduct [1]

O’Neill requires that all students treat others with mutual respect and behave professionally in

the classroom and during all academic and non-academic activities.

These civility and professional conduct requirements foster an appropriate atmosphere inside and outside the classroom:

Students must act in accordance with the O’Neill School mission and values.
Students must regularly attend and be fully prepared for class, including completing readings.
Students must not behave in a way that interrupts or distracts from teaching or learning. For example, students must be punctual in their arrival to class and be present and attentive for the duration of the class. They must not sleep, do work for another class, or wander in and out of the classroom, pack up, or leave class early (unless an emergency exists).
Students must abide by the course policy regarding use of electronic devices in the classroom, including a requirement that no electronics are allowed or that students are not permitted to use devices for non-class related purposes.
Students must responsibly participate in class activities and during team meetings for course assignments.
Students must attend scheduled meetings with faculty or staff, events for which they have RSVPed, interviews with prospective employers, and student organization meetings.
Students must address faculty members, other students, and others appropriately and with respect, whether in person, in writing, or in electronic communications.
Students must show tolerance and respect for others.
Students must practice respect and responsible stewardship of the physical resources of the school, refraining from destroying or defacing school property, integrating practices of sustainability, and contributing to a clean and orderly physical environment in all buildings, classrooms, offices, and meeting spaces.
Students must comply with the personal misconduct responsibilities within the IU Code of Student Rights, Responsibilities, & Conduct.

Reporting

Students must abide by the O’Neill Student Honor Code themselves and hold their peers to the same standards. Students should report suspected instances of academic, civility, or professional misconduct to the instructor of the course. Students should report suspected instances of personal misconduct to the IU Office of Student Conduct.

Academic Conduct Requirements

All students enrolled in O’Neill courses are subject to the academic misconduct provisions found in the IU Code of Student Rights, Responsibilities, & Conduct.

Academic misconduct is defined as any activity that tends to undermine the academic integrity of the institution.

The IU Code of Student Rights, Responsibilities, & Conduct lists and defines many types of academic misconduct, including cheating, fabrication, plagiarism, interference, violation of course rules, and facilitating academic dishonesty.

Academic misconduct includes the use of any technology or assistance, including AI, that is not permitted by the instructor.

Additional Information for Students

Counseling and Psychological Services

For information about services offered to students by CAPS: http://healthcenter.indiana.edu/counseling/index.shtml.

Religious Observation

In accordance with the Office of the Dean of Faculties, any student who wishes to receive an excused absence from class must submit a request form available from the Dean of Faculties for each day to be absent. This form must be presented to the course instructor by the end of the second week of this semester. A separate form must be submitted for each day. The instructor will fill in the bottom section of the form and then return the original to the student. Information about the policy on religious observation can be found at the following website: http://vpfaa.indiana.edu/policies/bloomington/instructional-responsibilities/religious-observances.shtml.

Disability Services for Students

Securing accommodations for a student with disabilities is a responsibility shared by the student, the instructor and the DSS Office. For information about support services or accommodations available to students with disabilities, and for the procedures to be followed by students and instructors: https://studentaffairs.indiana.edu/student-support/disability-services/index.html.

Sexual Harassment

As your instructor, one of my responsibilities is to help create a safe learning environment on our campus. Title IX and our own Sexual Misconduct policy prohibit sexual misconduct. If you have experienced sexual misconduct, or know someone who has, the University can help.

If you are seeking help and would like to talk to someone confidentially, you can make an appointment with:

The Sexual Assault Crisis Service (SACS) at 812-855-8900
Counseling and Psychological Services (CAPS) at 812-855-5711
Confidential Victim Advocates (CVA) at 812-856-2469
IU Health Center at 812-855-4011

For more information about available resources: http://stopsexualviolence.iu.edu/. It is also important to know that federal regulations and University policy require me to promptly convey any information about potential sexual misconduct known to me to our campus’ Deputy Title IX Coordinator or IU’s Title IX Coordinator. In that event, they will work with a small number of others on campus to ensure that appropriate measures are taken and resources are made available to the student who may have been harmed. Protecting a student’s privacy is of utmost concern, and all involved will only share information with those that need to know to ensure the University can respond and assist. I encourage you to visit the website above to learn more.

Commitment to Diversity: Find your home and community at IU

Asian Culture Center

Address: 807 East Tenth Street, Bloomington, IN 47408

Phone: 812-856-5361

Email: acc@indiana.edu

Website: https://asianresource.indiana.edu/index.html

First Nations Educational & Cultural Center

Address: 712 E 8th St., Bloomington, IN 47408

Phone: 812-855-4814

Email: fnecc@indiana.edu

Website: https://firstnations.indiana.edu/contact/index.html

Jewish Culture Center