Maxwell School of Citizenship and Public Affairs
State and Local Government Finance
426 Eggers Hall
Class Location: Maxwell 111
Class Time: 12:45-2:05 MW
Office Hours: In person: 3:00-4:00 MW & Online: By appointment
Class Lecture Slides – Coming Soon!
Course Overview and Requirements
This course examines the expenditure and revenue decisions of state and local governments and fiscal aspects of intergovernmental relations. The principal objectives of the course are to describe the fiscal institutions of the U.S. federal system; to develop analytical tools, primarily drawn from microeconomics, for understanding the behavior of voters, public officials, businesses, and other actors affected by state and local policy; and to provide tools that will help students make fiscal policy decisions. The course is designed for students who plan to be practitioners, that is, who plan to make decisions about state and local expenditures and revenues or about intergovernmental aid. The emphasis of the course is therefore more on institutions and on applications than on the fine points of theory, and students will be given many opportunities to apply their analytical skills to actual policy problems.
All students are expected to meet the highest standards for academic integrity. The university standards on this topic are described at http://academicintegrity.syr.edu.
Any student who believes that he or she may need accommodation because of a disability should contact the Syracuse University Center for Disability Services (https://disabilityresources.syr.edu/).
All students are expected to treat other students with respect. Disagreements about ideas are fine; personal attacks are not.
This course will be taught following the Syracuse University COVID guidelines. When this syllabus was prepared, the SU policy was to teach all classes in person with masks, worn appropriately, for both students and teachers. All students will be expected to meet these guidelines—or future guidelines that replace them.
As described in detail in the attached class schedule and reading list, the class will cover the following topics:
- State and Local Government Expenditures
- State and Local Government Revenues
- Financing State and Local Capital Projects
- Fiscal Aspects of State and Local Economic Development
- Intergovernmental Fiscal Relations
Time & “Place”
The class will meet in Maxwell 111 from 12:45 to 2:05 on Mondays and Wednesdays.
Class sessions will consist of a mix of lectures, case discussions, and student presentations. Questions from students are also encouraged.
This class will make extensive use of the internet. Students should expect to make frequent use of the professor’s web site. Many issues in state and local public finance are covered in The New York Times (http://www.nytimes.com/). The first few articles you read each month are free and The Times contains a wealth of information about state and local public finance. Other potentially useful sites include:
Education Finance and Accountability Program http://cpr.maxwell.syr.edu/efap/index.html
Education Week http://www.edweek.com/
Government Finance Officers Association http://www.gfoa.org
International City/County Management Association http://www.icma.org/go.cfm
National Conference of State Legislators http://www.ncsl.org/research/fiscal-policy/federal-tax-reform-and-the-states.aspx
National Education Access Network http://www.schoolfunding.info
National Governor’s Association http://www.nga.org/
National League of Cities http://www.nlc.org/
National Tax Association http://www.ntanet.org/
The Rockefeller Institute at SUNY Albany http://www.rockinst/org/
U.S. Census of Governments http://www.census.gov/govs/
U.S. Conference of Mayors http://www.usmayors.org/
The course is designed for students with previous exposure to microeconomic analysis. Some background in statistics and regression analysis is also desirable, but not required. Any student who has taken ECN 601 or PAI 723 with a grade of B or better may take this course. Other students must receive the instructor’s permission in order to enroll.
All students are required to (1) participate in class discussions, (2) prepare a professional memo based on one of the cases, (3) draft a memo with recommendations concerning state or local public finance in a jurisdiction of their choosing (4) present their recommendations to the class (after feedback from the professor), and (5) prepare a final version of their policy memo for posting on the class web site. Students may work in groups for the last three assignments. Students also may discuss the first two assignments with each other, but each student should work alone in writing the professional memo (the second assignment).
These assignments are designed for master’s students. Any PhD students in the class should consult the professor to design alternative assignments that are appropriate for his or her course of study.
(1) The first assignment is to participate in formal class discussions. As listed on the following class schedule, there are five case discussions in the class. Each student must play a lead role in one of these case discussions. The class web page (on the professor’s web site) includes a form that allows each student to indicate the cases on which he or she would like to play a lead role. This form should be downloaded, filled out, and turned in to the professor by e-mail (or delivered to the receptionist at the Center for Policy Research) on or before Monday, January 31. Students will be assigned to a case on a first-come, first-served basis. The final assignments will be available on the class web page before class on Wednesday, February 2 (with the first case to take place on Monday, February 7). Guidelines for the case discussions, including suggestions for students who are playing the lead role, are posted on the class web page.
Students who do not have a lead role for a particular case are still expected to attend and participate in the class discussion. Students are also expected to attend and participate in all three sessions of the class conference (discussed under the fourth requirement).
A student’s grade in class discussion will be based primarily on the case for which he or she plays a lead role. However, exceptionally helpful (or counterproductive) contributions in other case discussions and in the discussions during the class conference also could influence a student’s grade.
(2) The second requirement is to prepare a short (2‑page), professional memoranda to an imaginary decision maker. This memo must be based on one of the five case studies. Instructions for the memos, tips for professional writing, and examples of the professor’s professional memos can be found on the professor’s web site. A student may select any of the five possible memos, but a memo must be turned in at the beginning of the class during which it is discussed. Late memos will not be accepted. Plan ahead! These memos will be graded on presentation as well as on substance. Although only one memo is required, a student may submit two memos; his or her grade will be based on the best one.
(3) The third requirement is to draft a professional memorandum on a topic in state and local public finance selected by the student. This topic must either be taken directly from the course syllabus or be approved by the professor. Some topics in the class obviously will not have been covered by the time this draft is due. Students selecting one of these topics are expected to complete the relevant readings before drafting their memo.
The memo must include a policy recommendation for a particular state or local government, so this assignment involves some investigation both of a topic in state and local public finance and of the circumstances facing a particular government.
The memo should be between two and four pages in length (plus supporting tables and figures, if desired). Students are strongly encouraged to form groups to complete this assignment (and the following two assignments, which are related). A memo from a group should be two to four pages per student.
This memo must also have an annotated bibliography. This bibliography must list the sources used for the memo along with an evaluation of the credibility of the information from each source. This bibliography should indicate, for example, whether a source is a peer-reviewed journal article. Information about the credibility of each key sources should also be incorporated into the text of the memo where appropriate.
This draft memo is due on April 4. Unless specifically authorized by the professor, late memos will receive a grade penalty. The professor will provide comments on each student’s draft memo by April 15.
These draft memos (and their final versions, which are discussed below) will be graded largely on the quality of the analysis on which the recommendation is based. A terrific recommendation that is not backed up by good analysis will not receive a good grade. The readings for the course provide many examples of the type of analysis that can strengthen a memo and help to back up a recommendation. Additional material can be found in the National Tax Journal, Public Budgeting and Finance, Public Finance Review, the Economics of Education Review, Education Finance and Policy, and other professional journals.
These policy memos will also be graded on presentation, following the same guidelines as the case-based memos.
(4) The last four days of class (April 25 and 27, May 2 and 4) will be run as a conference on state and local public finance. Each student (or group of students) will present the topic and recommendation in his or her (their) memorandum (the third assignment), as revised in response to the professor’s comments. To the extent that time permits, each student (or group) will also respond to questions from the class. A schedule for the presentations will be posted on the class website by April 20. All members of a group should participate in the presentation.
(5) The fifth assignment is for each student (or group) to complete a final version of his or her (their) policy memo, incorporating both the professor’s comments and issues that arise in the discussion at the class conference. This final version should not exceed five pages (or five pages per student for groups), plus supporting tables and figures, if any. The final memo is due on May 9. Unless specifically authorized by the professor, late memos will receive a grade penalty.
All final memos will be posted on the class website, where they can be viewed not only by other students but by anyone with access to a web browser.
The professor may award a prize to the best memo. This prize will be announced on the web site. Several other memos may receive honorable mention, which will also be indicated when the memos are posted.
The following weights will be used to determine each student’s final grade in the course:
Case Discussions: 10%
Case Memo: 20%
Draft Policy Memo: 10%
Policy Presentations: 20%
Final Policy Memo: 40%
A typical final grade distribution for this class will have a median grade near the A-/B+ border, few straight A’s, and no B-‘s (at least for students who complete all the course requirements on time).
All “highly recommended” reading, which is listed on the following reading list, is available through the internet or on the class blackboard page.
WEEK 1 January 24-26
A. Introduction and Overview.
Course overview, description of the state and local public sector, principles of public finance.
B. Demand for Local Public Services I: Determinants.
Determinants of demand, mechanisms of demand articulation
WEEK 2 January 31-February 2
A. Demand for Local Public Services II: Collective Choice plus Tax & Expenditure Limitations.
Aggregating demand through voting, implications of demand for our system of local governments, including inequitable sorting
B. Demand for Local Public Services III: Public Safety
Demand for police and fire services, key policy issues concerning public safety
WEEK 3 February 7-9
A. Demand for Local Public Services IV:
*CASE DISCUSSION #1: Revising New York’s School Tax Relief Program.
B. Public Sector Cost Determinants I: Concepts.
Production and cost concepts, governmental inefficiency
WEEK 4 February 14-16
A. Public Sector Cost Determinants II: Policy.
Competition, privatization, and contracting out
B. Public Sector Cost Determinants III: Application.
*CASE DISCUSSION #2: Private Highways
WEEK 5 February 21-23
A. State and Local Revenue Sources: Overview.
Evaluating revenue sources, introduction to the property tax.
B. Property Tax I: Capitalization.
Property tax capitalization and assessment reform
WEEK 6 February 28-March 2
A. Property Tax II: Equity and Efficiency.
Impact of the property tax by income class, programs for property tax relief
B. Property Tax III:
*CASE DISCUSSION #3: State Regulation of Local Property Tax Assessing
WEEK 7 March 7-9
A. State and Local Income and Sales Taxes.
Definitions of tax bases, administrative feasibility, equity and efficiency
B. Sin Taxes.
Evaluating Taxes on liquor, cigarettes, marijuana, and lotteries.
WEEK 8 March 14-16
WEEK 9 March 21-23
A. State and Local Infrastructure.
What is capital spending? When is long-term financing appropriate? Who bears the burden?
B. State and Local Bonds I: Bond Markets.
What is a municipal bond? How do bond markets work?
WEEK 9 March 28-30
A. State and Local Bonds II: Issuing Bonds.
Procedures for issuing municipal bonds, rating and bidding
B. Fiscal Aspects of Economic Development I: Conceptual Tools.
Macroeconomic models; agglomeration Economics.
WEEK 10 April 4-6
A. Fiscal Aspects of Economic Development II: Policy.
Evaluating alternative state and local policies.
** Draft Policy Memo must be handed into the professor by April 4
B. CASE DISCUSSION #4: Subsidies to Firms?
WEEK 11 April 11-13
A. Intergovernmental Relations: Introduction.
Division of responsibilities in a federal system, theory of intergovernmental grants
B. School Aid I.
Objectives and design of education aid programs
WEEK 12 April 18-20
A. School Aid II.
Accountability, choice, and other issues related to state aid reform
B. School Aid III.
*CASE DISCUSSION #5: Campaign for Fiscal Equity vs. New York
WEEK 13 April 25-27
A. Class Conference: Day 1
B. Class Conference: Day 2
WEEK 14 May 2-4
A. Class Conference: Day 3
B. Class Conference: Day 4
**Final Policy Memo must be handed in to the professor by May 11.
CLASS OUTLINE AND READING LIST
An optional textbook for the class, which nicely supplements the other readings is State Tax Policy by David Brunori, 3rd Edition (The Urban Institute Press, 2011). It is abbreviated “Brunori” on the reading list. All highly recommended readings are available through the internet or on the class blackboard page. The reading list also provides several optional readings, most of which are available on the internet. State and Local Public Finance, 4th Edition, by Ronald C. Fisher (Routledge, 2016), abbreviated “Fisher” on the reading list, also provides excellent supplementary material for interested students. A few key chapters from Fisher are also posted on the class blackboard page.
Highly recommended readings are marked with an asterisk (*). Completing these readings before the class for which they are assigned will help a student understand the lectures.
INTRODUCTION AND OVERVIEW
- The Structure of Local Governments (Monday 1/24)
*U.S. Bureau of the Census. 2019. “From Municipalities to Special Districts, Official Count of Every Type of Local Government,” 2017 Census of Governments, October 29. (Skim)
C. Hogue. 2013. “Government Organization Summary Report: 2012.” Government Division Brief G12-CG-ORG, September 26.
Fisher, Chapters 1, 2, and 6. Available through the class blackboard page.
D. Green and E. Loualiche. 2021. “State and local government employment in the COVID-19 crisis.” Journal of Public Economics 193.
PART I: LOCAL GOVERNMENT EXPENDITURES
A. Demand for Local Public Services
- Determinants of Demand (Wednesday 1/26)
*Fisher, Chapter 3. Available on the class blackboard page.
*J. Yinger, “Bidding and Sorting,” In J. Yinger, editor, Poverty and Proficiency: The Cost of and Demand for Local Public Education (World Scientific Publishing, 2020), pp. 51-71. Available on the class Blackboard page.
- Collective Choice and Tax and Expenditure Limitations (Monday, 1/31)
*Fisher, Chapter 4. Available on the class blackboard page.
T.A. Downes and D.N. Figlio, 1999. “Do Tax and Expenditure Limits Provide a Free Lunch? Evidence on the Link Between Limits and Public Sector Service Quality,” National Tax Journal, (March): 113-128. Available through Journals at the SU library.
T.R. Hodge, G. Sands, and M. Skidmore, 2015. “Assessment Growth Limits and Mobility: Evidence from Home Sale Data in Detroit Michigan,” National Tax Journal, 68 (September): 573-600.
S.N. Kioko, 2011. “Structure of State-Level Tax and Expenditure Limits.” Public Budgeting & Finance, (Summer): 43-78. Available on the class blackboard page.
W. Duncombe and J. Yinger, 2011. “Making Do: State Constraints and Local Responses in California’s Education Finance System.” International Tax and Public Finance, (June): 337-368. Available on the class blackboard page.
L. Meckler and Kate Rabinowitz, 2019. “The lines that divide: School district boundaries often stymie integration.” The Washington Post, December 16.
S.F. Reardon and K, Bischoff. 2016. “The Continuing Increase in Income Segregation, 2007-2012,” CEPA Report, Stanford University.
- Public Safety (Wednesday, 2/2)
*A. Brown and I. Urbina. 2014. “The Disappearing Volunteer Firefighter.” The New York Times, August 16.
* E. Owens and B. Ba, 2021, “The Economics of Policing and Public Safety.” Journal of Economic Perspectives 35 (4) (Fall): 3–28.
* S. Dewan. 2021. “Adding More Police to Fight Crime? The Evidence Is Mixed.” The New York Times, November 8.
* J. David Goodman. 2021. “A Year After ‘Defund,’ Police Departments Get Their Money Back.” The New York Times, October 10.
* G. Witte. 2021. “In New Mexico, a bold experiment aims to take police out of the equation for mental health calls.” Washington Post, October 9.
R.C. Auxier. 2020. “What Police Spending Data Can (and Cannot) Explain amid Calls to Defund the Police,” The Urban Institute, June 9. Available at: What Police Spending Data Can (and Cannot) Explain amid Calls to Defund the Police | Urban Institute .
Office of the New York State Comptroller. 2017. “Fire Protection in New York State: How Is It Provided in Your Community?” March.
U.S. Department of the Census. 2011. “Census of State and Local Law Enforcement Agencies, 2008.” July.
W.C. Horrace and S.M. Rohlin. 2016. “How Dark Is Dark? Bright Lights, Big City, Racial Profiling.” Review of Economics and Statistics 98 (2) (May): 226–232.
Kim Barker, Michael H. Keller and Steve Eder. 2021. “How Cities Lost Control of Police Discipline.” (Updated) January. Available at: How Cities Lost Control of Police Discipline – The New York Times (nytimes.com)
E. Badger and Q. Bui. 2020. “Cities Grew Safer. Police Budgets Kept Growing.” The New York Times, June 12.
- Application (Monday, 2/7)
*Case Discussion #1: Revising New York’s School Tax Relief Program.
*J. Yinger, 2014. “The Last Word on STAR?” It’s Elementary, July. Available on the class blackboard page.
T. Eom, W. Duncombe, P. Nguyen-Hoang, and J. Yinger. 2014. “The Unintended Consequences of Property Tax Relief: New York State’s STAR Program.” Education Finance and Policy 9 (4) (Fall): 446-480.
B. Public Sector Cost Determinants
- Concepts (Wednesday, 2/9)
*J. Yinger. 2005. “Calculating the Added Costs of Educating Disadvantaged Students.” It’s Elementary, January.
W. Duncombe, and J. Yinger. 2011. “Are Education Cost Functions Ready for Prime Time? An Examination of their Validity and Reliability.” Peabody Journal of Education 86(1): 28-57. Available on the class blackboard page.
Fisher, Chapter 8. Available on the class blackboard page.
- Policy (Monday, 2/14)
*W.J. Baumol, and others. 2012. The Cost Disease: Why Computers Get Cheaper and Health Care Doesn’t. New Haven: Yale University Press, Introduction, Chapters 1 and 2. Chapters 3 and 4 are optional. Available on the class blackboard page.
*Key Findings from 50-State Assessment of Evidence-Based Policymaking: http://www.routefifty.com/2017/01/key-findings-50-state-assessment-evidence-based-policymaking/135042/?oref=rf-home-latest-top
M. Warner, and R. Hebdon. “Local Government Restructuring: Privatization and Its Alternatives.” Journal of Policy Analysis and Management (Spring 2001): 315-336. Available through Journals at the SU library.
Editorial Board. 2014. “Not Getting Their Money’s Worth.” The New York Times, January 3. Available on the class blackboard page.
R. Nixon. 2011. “Government Pays More in Contracts, Study Finds.” The New York Times, September 12. Available on the class blackboard page.
G.L. Berlin, 2016. “Using Evidence as the Driver of Policy Change: The Next Steps in Supporting Innovation, Continuous Improvement, and Accountability.” Testimony before the Senate Finance Committee, May 10. Available on the class blackboard page.
M.S. Spivack. 2021. “Struggling Local Governments May Get Help from the Private Sector.” The New York Times, January 19.
“Putting Evidence at the Heart of Making Policy,” MDRC, February 2017.
- Application (Wednesday, 2/16)
*Case Discussion #2: Private Highways. Available on the class blackboard page.
*J. Kile. “Public-Private Partnerships for Highway Projects,” Testimony before the Panel on Public-Private Partnerships, Committee on Transportation and Infrastructure, U.S. House of Representatives, March 5, 2014.
M. Laris. 2015. “How Virginia paid more than $250 million for a road that never got built.” The Washington Post, May 30.
PART II: STATE AND LOCAL GOVERNMENT REVENUES
A. Overview and Introduction to the Property Tax (Monday, 2/21)
*J. Yinger. 2020. “The Property Tax in the United States.” In J. Yinger, Editor, Poverty and Proficiency, the Cost of and Demand for Local Public Education, World Scientific Publishing. Skip Sections 3.2, 4.3, and 4.4. Available on the class blackboard page.
*Brunori, Chapters 1 and 2. Available on the class blackboard page.
*R.C. Fisher, 2009. “What Policy Makers Should Know about Property Taxes,” Land Lines, (January): 8-14.
U.S. Bureau of the Census, “Annual Survey of State and Local Government Finances.”
Fisher, Chapters 13. Available on the class blackboard page.
B. Property Tax
- Capitalization (Wednesday, 2/23)
*J. Yinger. “Property Tax Capitalization,” In J. Yinger, Editor, Poverty and Proficiency: The Cost of and Demand for Local Public Education (World Scientific Publishing, 2020), pp. 75-86. Available on the class Blackboard page.
J. Yinger, H. Bloom, A. Börsch‑Supan, and H. F. Ladd. 1988. Property Taxes and House Values (Academic Press), Chapter 1, and Chapter 7. Available on the class blackboard page.
K.R. Ihlanfeldt. 2011. “Do caps on increases in assessed values create a lock-in effect? Evidence from Florida’s amendment one.” National Tax Journal (March): 7-26. Available on the class blackboard page.
- Equity and Efficiency (Monday, 2/28)
*J. Yinger. 2020. “The Property Tax in the United States.” In J. Yinger, Editor, Poverty and Proficiency, the Cost of and Demand for Local Public Education, World Scientific Publishing. Sections 3.2, 4.3, and 4.4. Available on the class blackboard page.
P. Cohen. 2015. “Study Finds Local Taxes Hit Lower Wage Earners Harder.” The New York Times, Business Day, January 13. Available on the class blackboard page.
Fisher, Chapter 14. Available on the class blackboard page.
M. Skidmore, C.L. Ballard, and T.R. Hodge. 2010. “Property Value Assessment Growth Limits and Redistribution of Property Tax Payments: Evidence from Michigan.” National Tax Journal, (September): 509-538.
3. Application (Wednesday, 3/2)
*Case Discussion #3: State Regulation of Local Property Tax Assessing
C. Other State and Local Taxes
- Income and Sales Taxes (Monday, 3/7)
*W.B. Alfonso. 2019. “The Barriers Created by Complexity: A State-by-State Analysis of Local Sales Tax Laws in Light of the Wayfair Ruling.” National Tax Journal 72 (4) (December): 777-800.
*J.B. Stewart. 2013. “The Myth of the Rich Who Flee From Taxes.” The New York Times, February 15. Available on the class blackboard page.
J.L. Mikesell, and Justin Ross. 2019. “After Mayfair: What are State Use Taxes Worth?” National Tax Journal 72 (4) (December): 7801-820.
V.J. Karplus. 2013. “The Case for a Higher Gasoline Tax.” The New York Times, February 21. Available on the class blackboard page.
L. Chiou, and E. Muehlegger, 2014. “Consumer Response to Cigarette Excise Tax Changes.” National Tax Journal, (September) 67(3). Available on the class blackboard page.
Brunori, Chapters 5, 6, 8 and 10. Available on the class blackboard page.
Fisher, Chapters 15 and 16. Available on the class blackboard page.
R.H. Frank. 2011. “Find the Taxes That Do Double Duty.” The New York Times, Economic View, February 18. Available on the class blackboard page.
J. Alm, and J. S. Leguizamon. 2015. “Whither the Marriage Tax?” National Tax Journal 68 (June): 251-280.
S.H. Giertz, and M.S. Tosun. 2012. “Migration Elasticities, Fiscal Federalism, and the Ability of States to Redistribute Income.” National Tax Journal, (December): 1069-1092. Available on the class blackboard page.
2. Sin Taxes (Wednesday, 3/9)
*Brunori, Chapters 9. Available on the class blackboard page.
*L. Dadayan. 2019. “States’ Addiction to Sins: Sin Tax Fallacy.” National Tax Journal 72 (4) (December): 723-754.
C. Mace, E. Patel, and N. Seegert. 2020. “Marijuana Taxation and Imperfect Competition.” National Tax Journal 73 (2)(June): 545-591.
B. Hansen, K. Miller, B. Seo., and C. Weber. 2020. “Taxing the Potency of Sin Goods: Evidence from Recreational Cannabis and Liquor Markets.” National Tax Journal 73 (2)(June): 511-544.
J. Yinger. 2008. “Don’t Gamble with New York’s Lottery.” January. Available on the class blackboard page.
Fisher, Chapter 18. Available on the class blackboard page.
R.H. Mattoon. 2015. “Sin Taxes: The Sobering Fiscal Reality,” Essays on Issues, The Federal Reserve Bank of Chicago, Number 339. Available on the class blackboard page.
PART III: FINANCING CAPITAL PROJECTS
A. State and Local Infrastructure (Monday, 3/21)
* A. Bhatia, and Q. Bui. 2021. “The Infrastructure Plan: What’s In and What’s Out.” Upshot, The New York Times, August 10.
* M. Gold, M. Zaveri, and A. Wong. 2021. “What the Infrastructure Bill Means for the New York Region.” The New York Times, November15.
*A. Malinovskaya, and D. Wessel. 2017. “The Hutchins Center Explains: Public Investment. The Brookings Institution.” January 3.
*American Society of Civil Engineers, Investing in Infrastructure: Our Nation’s Economic Engine.
*San José State University Department of Economics, “An Introduction to Benefit-Cost Analysis.”
H. Lawrence. 2014. “Summers, Idle workers + Low interest rates = Time to rebuild infrastructure Rebuilding the nation’s airports, highways, and bridges will boost the economy and jobs.” The Boston Globe, April 11. Available on the class blackboard page.
U.E. Reinhardt. 2012. “America’s Mid-20th-Century Infrastructure.” Economix: Explaining the Science of Everyday Life. The New York Times, November 16.
J. Schwartz. 2013. “Governments Look for New Ways to Pay for Roads and Bridges.” The New York Times, February 14. Available on the class blackboard page.
W. Wang, W.D. Duncombe, and J. Yinger. 2011. “School District Responses to Matching Aid Programs for Capital Facilities: A Case Study for New York’s Building Aid Program.” National Tax Journal (September) 64 (3): 759–794. Available on the class blackboard page.
B. State and Local Bonds
- Bond Markets (Wednesday, 3/23)
*The Bond Market Association. “An Investor’s Guide to Bond Basics.” (scroll down to find this guide).
*J. Yinger. 2020. “Present Value and Discounting, with Applications to Local Public Finance.” Appendix A in J. Yinger, Editor, Poverty and Proficiency, the Cost of and Demand for Local Public Education, World Scientific Publishing. Section on Bonds. Available on the class blackboard page.
*I. Lovett. 2013. California Schools Finance Upgrades by Making the Next Generation Pay, The New York Times, February 9. Available on the class blackboard page.
*H.K. Galper, Rueben, R. Auxier, and A. Eng. 2014. “Municipal Debt: What Does It Buy and Who Benefits?” National Tax Journal, (December) 67(4): 901-924. Available on the class blackboard page.
- Issuing Bonds (Monday, 3/28)
*The Bond Market Association. “An Investor’s Guide to Municipal Bonds.” Start with “What Are Municipal Bonds;” click on the other entries on the left of the page to learn more.
*P. Sullivan. 2016. “Municipal Bond Defaults Shake Up a Once-Sedate Market.” The New York Times, April 22. Available at:
U.S. Municipal Bond Defaults and Recoveries, 1970-2011, Mody’s Investor Service, March 7, 2012. Available on the class blackboard page.
M.J. Luby. 2012. “Federal Intervention in the Municipal Bond Market: The Effectiveness of the Build America Bond Program and Its Implications on Federal and Subnational Budgeting,” Public Budgeting & Finance (Winter): 46-70. Available on the class blackboard page.
I. J. Law. 2011. “Unbreakable Bonds.” The New York Times, March 20. Available through the class blackboard page.
M. Williams Walsh. 2009. “Bond Advice Leaves Pain in Its Wake.” The New York Times, February 17. Available on the class blackboard page.
J. Yinger. 2009. “Municipal Bond Ratings and Citizens’ Rights,” American Law and Economics Review, (October):1-38. Available on the class blackboard page.
PART IV: FISCAL ASPECTS OF ECONOMIC DEVELOPMENT
A. Concepts (Wednesday, 3/30)
Readings on the cancelled Amazon deal with New York City.
*E. Moretti. 2010. “Local Multipliers,” American Economic Review: Papers & Proceedings (May):1-7. Available on the class blackboard page.
J.E. Anderson. 2012. “State Tax Rankings: What Do They and Don’t They Tell Us?” National Tax Journal (December): 985-1010. Available on the class blackboard page.
Fisher, Chapters 17 and 22. Available through the class blackboard page.
B. State and Local Policy (Monday, 4/4)
*Brunori, Chapter 3. Available on the class blackboard page.
* D. Hemel. 2021. “South Dakota’s tax avoidance schemes represent federalism at its worst.” Washington Post, October 7.
* Howard Gleckman. 2021. “South Dakota Turned Itself Into A Tax Haven. But Why?” The Urban Institute/Brookings Institution Tax Policy Center, October 14.
*J. Drucker and E. Lipton, 2019. “How a Trump Tax Break to Help Poor Communities Became a Windfall for the Rich.” The New York Times, August 31.
*D.A. Kenyon, A. H. Langley, and B. P. Paquin. 2012. “Property Tax Incentive Pitfalls.” National Tax Journal, (December): 1011-1022. Available on the class blackboard page.
S.M. Rosenthal. 2018. “Opportunity Zones May Create More Opportunities for Investors and Syndicators Than Distressed Communities.”
*D. Leonhardt. 2011. “A Conversation with Edward L. Glaeser.” The New York Times, Economix, February 15. Available on the class blackboard page.
*W.G. Gale, A. Krupkin, and K. Rueben. 2015. “The States Try Supply Side Tax Cuts.” The Milken Institute Review, Fourth Quarter.
H. Kang, L. Reese, and M. Skidmore. 2016. “Do Industrial Tax Abatements Spur Property Value Growth?” Journal of Policy Analysis and Management, Vol. 35, No. 2, 388–414. Available on the class blackboard page.
T.J. Bartik. 2017. “A New Panel Database on Business Incentives for Economic Development Offered by State and Local Governments in the United States.” W. E. Upjohn Institute for Employment Research, Report 225.
W.G. Gale, A. Krupkin, and K. Rueben. 2015. “The Relationship Between Taxes and Growth at the State Level: New Evidence.” National Tax Journal 68 (December): 919-942.
R.T. Greenbaum, and J. Landers. 2014. “The Tiff over Tif: A Review of the Literature Examining the Effectiveness of the Tax Increment Financing.” National Tax Journal, (September) 67(3): 655-674. Available on the class blackboard page.
D. Burnes, D. Neumark, and M.J. White. 2014. “Fiscal Zoning and Sales Taxes: Do Higher Sales Taxes Lead To More Retailing and Less Manufacturing?” National Tax Journal (March) 67(1): 7–50. Available on the class blackboard page.
D. Bruce, X. Liu, and M.N. Murray. 2015. “State Tax Policy and Entrepreneurship.” National Tax Journal 68 (Special Issue, September): 803-838.
J. Kolko, and D. Newmark. 2010. “Do Some Enterprise Zones Create Jobs?” Journal of Policy Analysis and Management (Winter): 5-38.
N. Bania, and J. A. Stone. 2008. “Ranking State Fiscal Structure Using Theory and Evidence.” Journal of Policy Analysis and Management (Autumn): 751-770.
C. Application (Wednesday, 4/6)
*Case Discussion #4: Subsidies to firms?
PART V: INTERGOVERNMENTAL RELATIONS
A. Introduction and the Concept of Fiscal Health (Monday, 4/11)
*H.F. Ladd, and J. Yinger, America’s Ailing Cities: Fiscal Health and the Design of Urban Policy, (The John Hopkins University Press) Chapters 5, Chapter 9, and Epilogue. These are available on the class blackboard page.
Fisher, Chapters 6 and 10. Available on the class blackboard page.
K. Bradbury, and B. Zhao. 2009. “Measuring Non-School Fiscal Disparities among ‘Municipalities’.” National Tax Journal (March): 25-56.
B. School Aid
- Aid Design (Wednesday, 4/13)
*J. Yinger. 2004. “State Aid and the Pursuit of Educational Equity: An Overview,” In Helping Children Left Behind, edited by J. Yinger, MIT Press, 2004. Skip sections 3.5 through 3.7 and 4.4 through 4.6.
*H.F. Ladd, and E.B. Fiske. 2011. “Class Matters, Why Won’t We Admit It.” The New York Times, Op-Ed, (December). Available on the class blackboard page.
*U.S. Census. 2009. Public Education Finances: Skim the “Introduction” and “Table 1.” Available at: http://www2.census.gov/govs/school/09f33pub.pdf
*Center for Educational Equity. 2021. “Recent Events” in New York, especially the section titled “New Yorkers for Students’ Educational Rights v. State of New York.” Available at http://www.schoolfunding.info/litigation-map/new-york/#1483935373027-36380f69-4a8a
E. Gutierrez, and J. Yinger. 2018. “How Fair Is New York State’s Foundation Aid Formula?” It’s Elementary, February.
J. Yinger. 2014. “The Impact of Education Finance Reform on Student Achievement in Massachusetts.” It’s Elementary, May.
Fisher, Chapter 19. Available on the class blackboard page.
- Topics Related to Aid Reform (Monday 4/18)
*S. Dynarski. 2015. “Urban Charter Schools Often Succeed. Suburban Ones Often Don’t.” The New York Times, November 20.
*J. Yinger. 2004. “State Aid and the Pursuit of Educational Equity: An Overview,” In Helping Children Left Behind, edited by J. Yinger, MIT Press, Sections 3.5 through 3.7 and 4.4 through 4.6.
M.W. Rothbart. 2020. “Does School Finance Reform Reduce the Race Gap in School Funding?” Education Finance and Policy 15 (4)(Fall): 675-707.
D. Figlio. 2004. “Funding and Accountability: Some Conceptual and Technical Issues in State Aid Reform,” In Helping Children Left Behind, edited by J. Yinger, MIT Press. Available on the class blackboard page.
K.Carey. 2017. “Dismal Voucher Results Surprise Researchers as DeVos Era Begins.” The New York Times, TheUpshot: School Choice, February 23.
- Application: School Aid Reform in New York State (Wednesday, 4/20)
*Case #5: Campaign for Fiscal Equity vs. New York. Available on the class blackboard page.
Center for Educational Equity. 2021. “Recent Events” in New York, especially the section titled “New Yorkers for Students’ Educational Rights v. State of New York.” Available at http://www.schoolfunding.info/litigation-map/new-york/#1483935373027-36380f69-4a8a