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Published on Monday, November 16, 2015

AWC Ad Hoc Committee on Municipal Finance considers the future of city fiscal sustainability

One of AWC’s major priorities to ensure sufficient and flexible revenue for essential city services. The current method of funding city services is fundamentally broken, and many available revenue options are either constricted, restricted, or unpredictable. Cities need stable revenue streams to provide essential services such as public safety, infrastructure, and environmental protection to our growing population.

In 2012, AWC brought together an Ad Hoc Committee on Municipal Finance. This committee of city elected officials, managers, finance directors, and intergovernmental relations staff were tasked with considering short and long-term strategies to address the challenges of current revenue options. The committee developed a number of recommendations that were successfully pursued during the 2014 and 2015 legislative sessions, including:

  • Preventing sweeps of liquor and other state shared revenues;
  • Advocating for a statewide transportation funding package;
  • Pursuing shared revenue from marijuana taxes; and
  • Educating legislators about the challenges of a 1% property tax cap.

While these short-term legislative priorities are extremely important to cities, they do not change a broken revenue structure that is insufficient.

In late October 2015, the committee reconvened to consider longer-term strategies to address the structural issues surrounding city funding. The committee discussed rapidly increasing costs, city revenue constraints, city authority and services, impacts of the recession, and the need to educate voters and legislators about the systemic city financing problem. Over the next several months, AWC will conduct additional research suggested by the committee. The committee’s goal is to develop additional legislative proposals for the 2017 session with recognition that city fiscal sustainability is a longer term goal.

If you have suggestions about how cities could achieve fiscal sustainability or would like more information about this AWC initiative, please contact Victoria Lincoln or Serena Dolly.

Categories: Budget & finance
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