Category Archives: State & Local Finance

Transparency, Performance Management, And The Public Trust

Source: Public Manager, Volume 38, Number 1, Spring 2009
(subscription required)

This Forum contains the following articles:

– Introduction – Cal Clark and Don-terry Veal
This introduction opens a forum whose articles have been adapted from the Symposium on Advancing Excellence and Public Trust in Government that was held at the National Press Club in Washington, DC, on September 17, 2007. The forum examines how promoting greater transparency and measuring performance can help restore America’s trust in the public sector.

– Bringing Transparency to Municipal Budgets – Irene Rubin
Budgeting certainly reflects reality, but this is often hard to see. The “telephone directory” approach often taken overwhelms its audience with page after page of data without emphasizing the important information. Consequently, although the budget contains the key facts and figures, the audience can’t discern them, which creates a sense of unreality. Municipal budgeting tends to be incredibly detailed but very unrevealing.

– Using the Internet to Make State Budgets Transparent – Sandra Fabry
To achieve accountability, government expenditures should be transparent and accessible. After all, the consent of the governed from which government derives its just powers is much more meaningful if it is informed. In today’s environment, we need a new standard of access because much of the fiscal information is available to the public due to sunshine laws at the state and federal levels. However, being subject to, say, the Freedom of Information Act doesn’t necessarily mean easy access.

– Measuring Government Performance to Promote Transparency – Richard Greene
The Government Performance Project is an effort funded by (and now within) the Pew Center on the States that examines each of the fifty state governments every three years in four major areas of management: human resources, infrastructure, strategic planning, and performance measurement.

– Targeted Transparency – David Weil
Transparency is a fundamental component of democratic government. It concerns the right of citizens to know about the activities of their government. Transparency policies have expanded to protect against institutional corruption, a notion that underlies Louis Brandeis’s famous quote: “Sunlight is said to be the best of disinfectants.”

– Transparency, Governance, and Civic Engagement – Christopher Hoene
This article opines that it’s not enough to just consider transparency in a budgeting sense. Planning and setting priorities, and then making the budget fit accordingly, is more important. Our system of public finance is broken. We’re making choices about services that everybody needs using revenue and finance mechanisms based on nineteenth and twentieth century economies. We’re in a twenty-first century economy that is creating wealth in many new and different ways, such as the Internet, but we are not figuring out how to tap that wealth and make it contribute equitably.

Sustaining Progress in Times of Fiscal Crisis

Source: Paul E. Peterson, Henry Lee Shattuck, Eric A. Hanushek, Martin R. West, Florida State Board of Education, March 16, 2009

From the press release:
Despite the current economic crisis, Florida has a unique opportunity to improve its current K-12 education system by protecting policies that provide incentives for higher achievement while cutting back on those that do not contribute to performance, according to a new report co-authored by three scholars at Harvard Kennedy School, Stanford University, and Brown University.

Raising State Income Taxes on High-Income Taxpayers

Source: Elizabeth McNichol, Andrew Nicholas and Jon Shure, Center on Budget and Policy Priorities, April 20, 2009

As states face increasingly difficult choices for closing the gap between available resources and the cost of needed programs and services, one potential revenue source can be found at the high end of the income tax spectrum.

The personal income tax, a major source of revenue for 41 states, can yield a significant amount of money from small rate increases that involve a relatively low number of taxpayers — those that are best able to afford the cost. This is because wealth in the United States has become concentrated among the nation’s richest households to an extent not seen since the late 1920s.

Infrastructure Ventures

Source: Urban Land, April 2009
(subscription required)

Urban Land looks at infrastructure issues in light of the U.S. federal economic stimulus plan and the opportunities and challenges it poses for the development community. Articles include:

Structured Parking for Transit-Oriented Development

By Timothy H. Haahs and James M. Zullo
Federal stimulus money could be used to bridge the financial gap associated with the cost of structured parking in transit-oriented development projects and provide a meaningful strategy to advance such projects and smart growth.

U.S. Infrastructure Spending: How Much Is Enough?

By Sarah Jo Peterson
Although the private sector does invest in infrastructure, much, if not most, of the billions in spending comes from taxpayers. How much is enough? The guidance of engineers, economists, and environmental innovators shows that the answer depends on what people want out of infrastructure.

Transportation Reauthorization Options

By Jeffery Spivak
A virtual who’s who of transportation associations and interest groups is calling for an entirely new federal approach in the next long-term transportation bill.

The Role of Medicaid in State Economies: A Look at the Research

Source: Kaiser Commission on Medicaid and the Uninsured, Policy Brief, January 2009

The country is currently in the midst of a recession. Forty-four states are facing budget shortfalls in FY 2009 or FY 2010, state revenues are lower than projected, and unemployment rose to a fifteen-year high of 6.7 percent in November. Given Medicaid’s role as a major component of state budgets, as state policy makers grapple with closing budget shortfalls, Medicaid is often targeted as a potential area to gain savings. However, cutting Medicaid not only adversely affects beneficiaries and providers, but also has an impact on the larger state economy.

Reforming the Tax Treatment of S-Corporations and Limited Liability Companies Can Help States Finance Public Services

Source: Michael Mazerov, Center on Budget and Policy Priorities, April 8, 2009

Nineteen states impose only nominal taxes on businesses organized as subchapter S Corporations (S-Corps) or Limited Liability Companies (LLCs) even though these entities — which generate about one-fourth of all business receipts — benefit from state services just as businesses that are subject to state corporate income taxes do. In addition, many of the states that do impose meaningful taxes on S-Corps and LLCs would benefit by updating their tax laws in this area, such as by equalizing their tax treatment of the two kinds of entities. By reforming their policies toward S-Corps and LLCs, states can strengthen their revenue systems to help deal with budget problems states now face.

Policy Basics: Where Do Our State Tax Dollars Go?

Source: Center on Budget and Policy Priorities, April 13, 2009

Given the budget problems states face due to the recession, policymakers will confront important choices about how to pay for important government services and programs. To inform this crucial decision making, it is useful to examine where state tax dollars go as well as changing trends over time.

In total, the 50 states and the District of Columbia spent a little more than $1 trillion in state revenues in fiscal year 2007, according to the most recent survey by the National Association of State Budget Officers (NASBO).

Authority of State Legislatures to Accept Funds Under the American Recovery and Reinvestment Act of 2009

Source: Kenneth R. Thomas, Congressional Research Service, R40467, March 25, 2009

This report analyzes the language contained in §1607 of the American Recovery and Reinvestment Act of 2009 (Recovery Act), which provides that federal funds can be made available to a state by the federal government either after certification by a governor that such money will be requested and spent or after the adoption of a concurrent resolution by a state legislature. Although the language of § 1607 is arguably ambiguous, it does not appear likely that it would have the effect of significantly reallocating power between a state legislature and a state executive branch. Thus, once either a governor’s certification or the legislature’s acceptance has been made, § 1607 would have little or no apparent effect on the power of a governor, state or local official to choose whether or not to seek and administer these funds. Any interpretation of this language which did provide authority to a state legislature, by concurrent resolution, to direct the acceptance and spending of federal monies by state or local officials, would be likely to raise Tenth Amendment issues. Consequently, such an interpretation would be disfavored.

Source: Onvia, 2009

Welcome to and Onvia. This site was developed to bring unprecedented transparency and accountability to recovery spending and ensure that every business, regardless of size, has equal access to the projects associated with the recovery efforts. On this site you will find real-time data, maps, and graphs detailing the spending activity associated with the American Recovery and Reinvestment Act. Onvia tracks “every dime” of spending by Federal, State and Local government agencies, and allows you to explore these activities in great detail by State, by Congressional District, and by Community.