Budgeting is examined in view of the increasingly complex relationship between colleges and universities and state governments. It is noted that there needs to be dramatic revisions to improve the responsiveness of state government to the needs of society, and institutions of higher learning have a stake in the outcome of this so-called governmental transformation. The contributors to this book analyze in separate chapters the following: (1) ways in which college and university administrators set out to build a budget (Gene A. Budig); (2) ways in which higher education budgets are packaged and sold to the general public (John W. Hicks); (3) factors that are used by governors in the review of higher education budgets (T. N. Hurd and Donald Axelrod); and (4) factors involved when state legislators scrutinize the budgetary submissions (A. Alan Post). These essays should be helpful references for governors and state legislators, their respective budgetary staffs, college and university administrators, and graduate students of state governments and higher education. (Author/LBH)