Financial Management for Local Governments
- Local Government Finance Issues
- Local Revenue Sources
- Local Government Budgeting Process
- Strategic Planning Tools
- Financial Management Handbook and Guide Examples
Local governments face challenges that impact their ability to provide both current and new community services. This online guide provides local officials access to full-text resources discussing local government finance issues. The first section covers issues ranging from unfunded mandates to home rule to changing tax policies and expenditure limits. The second section includes information resources on the variety of revenue sources available to local officials including revolving loan funds, community development financial institutions, local option transportation taxes, block grants, and more. The third section provides information on the local budget process such as balancing the budget, improving budget performance, budgeting for outcomes, implementing best practices, and involving citizens in the process. The fourth section lists resources to assist local officials plan economic development strategies for community growth including tool kits, best practices, models, handbooks and guides, and assessment tools. The last section includes examples available to local officials of various financial management handbooks from schools, local and state governments.
This resource guide was revised and updated by Patricia L. John in 2005.
Rural Information Center Publication Series; no. 67 2005
Last modified: July 2013.
The use of trade, firm, or corporation names in this publication (or page) is for the information and convenience of the reader. Such use does not constitute an official endorsement or approval by the United States Department of Agriculture or the Agricultural Research Service of any product or service to the exclusion of others that maybe suitable.
For more information see National Agricultural Library Policy and Disclaimers: http://www.ars.usda.gov/disclaim.html#access
"Economic and Financial Management of Small Water Supply Systems: Issue Introduction." John B. Braden and Philip C. Mankin. Journal of Contemporary Water Research & Education. 128 (June 2004): 1-5. http://www.ucowr.siu.edu/updates/128/Braden.pdf [PDF file]
The Effect of Home Rule on Local Government Behavior: Is There No Rule Like Home Rule? Gyusuck Geon, Geoffrey K. Turnbull. Atlanta: Georgia State University, 2004. 18 p. http://aysps.gsu.edu/urag/workingpapers/2004/urag_0405.pdf [PDF file]
Local Budgets and Tax Policies in California and U.S. Cities: Surveys of City Officials. Mark Baldassare, Christopher Hoene. Presented at the National League of Cities Congress of Cities and Exposition, Session on Taxing Choices: Local and State Responses to Tax and Spending Limits Indianapolis, Indiana December 3, 2004. San Francisco: Public Policy Institute of California, 2004. 36 p. http://www.ppic.org/content/pubs/op/OP_1204MBOP.pdf [PDF file]
Local Government Finance Issues in the United States, Robert L. Bish. Working Paper, 5. Victoria, BC: Center for Public Sector Studies, Local Government Institute, University of Victoria, 2002. 16 p. http://www.ipp.org.nz/localgovtfiles/Funding%20and%20rating/US%20lg%20finance%20issues%20Bish%2002.pdf [PDF file]
"Local Government Financial Capacity and the Growing Importance of State Aid." Mildred E. Warner. Rural Development Perspectives. 13, no. 3 (1999): 27-36.
http://www.ers.usda.gov/publications/RDP/Rdp1098/rdp1098d.pdf [PDF file]
A Report on Local Government Funding: An Overview of National Issues and Trends, Gordon Shuford and Richard Young. Columbia: Institute of Public Affairs, Center for Governance, University of South Carolina, 2000. 99 p. http://www.strom.clemson.edu/teams/ced/lgp-reports/Trends.pdf [PDF file]
"Rural America at the Turn of the Century: One Analyst's Perspective." David Freshwater. Rural America. 15, no. 3 (2000): 2-7.
http://www.ers.usda.gov/publications/ruralamerica/sep2000/sep2000c.pdf [PDF file]
Rural Roads and Bridges: Financing Local Roads and Bridges in Rural Areas. Norman Walzer, Steven C. Deller. Washington, DC: U.S. Department of Agriculture, Agricultural Marketing Service, Transportation and Marketing Division, 1997. 15 p. 1997. http://ntl.bts.gov/lib/12000/12100/12198/IIRA_Other_189.pdf [PDF file]
"Salvaging Our Failing Infrastructure: A Public Works Challenge." Tom Black. American City and County, vol. 113, no.
10, September 1998: 64-91. http://www.americancityandcounty.com/mag/government_salvaging_failing_infrastructurea/
State Mandates on Local Governments. Program Evaluation Report. St. Paul: Minnesota Office of the Legislative Auditor, 2000. 84 p.
http://www.auditor.leg.state.mn.us/ped/pedrep/0001all.pdf [PDF file]
Tax and Expenditure Limits on Local Governments. Daniel R. Mullins, Kimberley A. Cox. M-194. Washington, DC: Advisory Commission on Intergovernmental Relations, 1995. 68 p.http://www.library.unt.edu/gpo/acir/Reports/information/M-194.pdf [PDF]
"Transition Year Brings Changes for Rural Development." Richard J. Reeder. Rural America. 17, no. 2 (2002): 44-53.
http://www.ers.usda.gov/publications/ruralamerica/ra172/ra172g.pdf [PDF file]
Unfunded Mandates: The Florida Experience. J. Stanley Marshall. Policy Report No. 25. Tallahassee, FL: James Madision Institute, 1999. 10 p.
http://jamesmadison.org/pdf/materials/166.pdf [PDF file]
Are Revolving Loan Funds a Better Way to Finance Rural Development? James. J. Mikesell and George B. Wallace. Agricultural Information Bulletin No. 724-05. Washington, DC: Economic Research Service, U.S. Department of Agriculture, October 1996. 4 p.http://www.ers.usda.gov/publications/aib724/AIB72405.pdf [PDF file]
Best Practices in Revolving Loan Funds for Rural Affordable Housing. Amy L. Rose and Christopher Holden. Washington DC: Housing Assistance Council, 2003. 71 p.
http://www.ruralhome.org/storage/documents/revolvingloanfunds.pdf [PDF file]
Credit in Rural America. AER 749. Washington DC: Rural Economy Division, Economic Research Service, 1997. 111 p.
The Effects of Tax Increment Financing on Economic Development. Richard F. Dye and David E. Merriman, Working Paper #75. Urbana: University of Illinois, Institute of Government Affairs, 1999. 44 p. http://igpa.uillinois.edu/system/files/WP75-TIF.pdf [PDF file]
Evaluating Alternative Revenue Sources. Ian J. Allan. Research Bulletin. Chicago, IL: Government Finance Officers Association, 1992. 13 p.
http://gfoa.org/services/dfl/bulletin/BUDGET-Evaluating-Alternative-Revenue-Sources.pdf [PDF file]
Financing Rural America, Proceeding of the December 4-5, 1996 Financing Rural America Conference. Kansas City, MO: Federal Reserve Bank of Kansas City, 1996. 197 p. http://www.kc.frb.org/PUBLICAT/fra/framain.htm
"Financing the New Rural Economy." Deborah M. Markley. In Exploring Policy Options for a New Rural America, Proceeding of the April 30 - May 1, 2001 Exploring Policy Options for a New Rural America Conference. Kansas City, MO: Federal Reserve Bank of Kansas City, 2001. pp 69-80. http://www.kansascityfed.org/PUBLICAT/Exploring/Exploringmain.htm
A Guide to Funding Resources. Patricia LaCaille John. Beltsville, MD: Rural Information Center, National Agricultural Library. 2004. 25 p. https://www.nal.usda.gov/ric/ricpubs/fundguide.html
"How Would Rural Areas Fare Under Block Grants?" Richard J. Reeder. Agricultural Information Bulletin No. 724-03. Washington, DC: Economic Research Service, U.S. Department of Agriculture, April 1996. 4 p. http://www.ers.usda.gov/publications/aib724/AIB72403.pdf [PDF file]
Investing in Community: Community Development Financial Institutions in Native Communities. Sarah Dewees. Kyle, SD: First Nations Oweesta Corporation, 2004. 37 p.
http://www.firstnations.org/Publications/NativeCDFIPaper-Final.pdf [PDF file]
Local Government Funding in South Carolina: Trends and Challenges. Holley Hewitt Ulbrich. Columbia: Center for Governance, Institute of Public Affairs, University of South Carolina, 2000. 72 p. http://www.strom.clemson.edu/publications/ulbrich/govfunding-2.html
Local Option Transportation Taxes in the United State. Todd Goldman, Sam Corbett and Martin Wachs. Research Reports, UCB-ITS-RR-2001-3/4. Berkeley: Institute of Transportation Studies, University of California at Berkeley, 2001. 2 v. http://www.its.berkeley.edu/publications/localoptiontax/localoptiontaxmain.html
New Governance for a New Rural Economy: Reinventing Public and Private Institutes, Proceedings of the May 17-18, 2004 Conference. Kansas City, Mo: Federal Reserve Bank of Kansas City, 2004. 156 p. http://www.kansascityfed.org/PUBLICAT/NewGovernance04/NewGovernance_main.htm
Partners in Community Building: Mainstream and Community Development Financial Institutions. Valjean McLenighan and Kathryn Tholin. Chicago: Woodstock Institute, 1997. 51 p. http://woodstockinst.org/document/partners.pdf [PDF file]
"A Quiet Revolution in Transportation Finance: The Rise of Local Option Transportation Taxes." Todd Goldman, Martin Wachs. Transportation Quarterly. 57, no. 1 (2003): 19-23. http://www.uctc.net/research/papers/644.pdf [PDF file]
A Revenue Guide for Washington Cities and Towns. Revised Edition. Report no. 46. Seattle: Municipal Research & Services Center of Washington, 1999. 52 p.
http://www.mrsc.org/Publications/revguide.pdf [PDF file]
A Revenue Guide for Washington Counties. Seattle: Municipal Research & Services Center of Washington, 2001. 36 p.
Types of Property Tax and Assessment Limitations and Tax Relief Programs. Nikolai Mikhailov. Cambridge, MA: Lincoln Institute of Land Policy, 1998. 14 p.
"Which Federal Programs Are Most Important for the Great Plains?" Rick Reeder, Faqir Bagi, and Samuel Calhoun. Rural
Development Perspectives, 13, no. 1 (1998): 52-58. http://www.ers.usda.gov/publications/RDP/RDP298/rdp298h.pdf [PDF file]
"Who's Vulnerable to Federal Budget Cuts?" Richard Reeder, Faqir Bagi, and Samuel Calhoun.
Rural Development Perspectives, 11, no. 2 (1996): 36-42. http://www.ers.usda.gov/publications/rdp/rdp296/rdp296f.pdf [PDF file]
"Application of BEA Economic Areas in the Development of the Great Basin Fiscal Impact Model." Thomas R. Harris, and others. Journal Regional Analysis & Policy. 3, no. 1 (2000): 75-92. http://www.jrap-journal.org/pastvolumes/2000/v30/30-1-5.pdf [PDF file]
"Budgeting for Outcomes: Delivering Results Citizens Value at a Price They Are Willing to Pay." David Osborne and Peter Hutchinson. Government Finance Review. October 2004: 11-14. http://www.gfoa.org/downloads/GFR1004.pdf [PDF file]
"Capital Budgeting Practices Among Tennessee Municipal Governments". Alex Sekwat. Government Finance Review. June 1999: 15-19.
http://www.gfoa.org/services/dfl/bulletin/BUDGET-CapBudgJun99.pdf [PDF file]
"Citizen Participation in Local Government Budgeting." Maureen Berner. Popular Government. 66, no. 3 (2001): 23-30.
http://ncinfo.iog.unc.edu/pubs/electronicversions/pg/pgspr01/article3.pdf [PDF file]
"Defining Performance Budgeting for Local Government." William C. Rivenbark. Popular Government. 69, no. 2 (2004): 27-36.
http://ncinfo.iog.unc.edu/pubs/electronicversions/pg/pgwin04/article3.pdf [PDF file]
"Finding Opportunities in Fiscal Stress: How to Balance Your Budget and Improve Performance." Anne Spray Kinney, Peter Hutchinson, and David Osborne. Government Finance Review. August 2002: 12-15. http://www.gfoa.org/services/dfl/bulletin/BUDGET-Kinneyarticle.pdf [PDF file]
A Grassroots Advocates Guide to Influencing the Local Government Budget Process: Influencing Policy-Making Where You Live: at the City and County Level. Darold Johnson and Makani Themba-Nixon. Washington, DC: The Praxis Project, nd, 12 p. http://www.thepraxisproject.org/tools/Guide_to_budgets.doc
Guidelines for Public Expenditure Management. Barry H. Potter and Jack Diamond. Washington, DC: International Monetary Fund, 1999. 69 p.
Municipal Budgeting. Michael Schaeffer. Municipal Finance 4. Washington, DC: World Bank, 2000. 40 p.
Public Expenditure Management Handbook. Washington, DC: World Bank, 1998. 177 p. http://www1.worldbank.org/publicsector/pe/handbook/pem98.pdf [PDF file]
"Putting the NACSLB Recommended Budget Practices into Action: Best Practices in Budgeting." Roland Calia, Salomon Guajardo, and Judd Metzgar. Government Finance Review. April 2000: 1-9. http://www.gfoa.org/services/dfl/bulletin/BUDGET-BudgetingBPApr00.pdf [PDF file]
Recommended Budget Practices: A Framework for Improved State and Local Government Budgeting. National Advisory Council on State and Local Budgeting. Chicago, IL: Government Finance Officers Association, 1998. 78 p. http://www.gfoa.org/services/nacslb/mainmenu.htm
"Searching for a Role for Citizens in the Budget Process." Carol Ebdon and Aimee Franklin. Public Budgeting & Finance. 24, no. 1 (2004): 32-49.
http://www.chs.ubc.ca/participatory/docs/Ebdon_Franklin(A).pdf [PDF file]
Unreserved Fund Balance and Local Government Finance. Ian J. Allan. Research Bulletin. Chicago, IL: Government Finance Officers Association, 1990. 13 p.
http://gfoa.org/services/dfl/bulletin/BUDGET-Unreserved-Fund-Balance.pdf [PDF file]
Alternative Development Strategies for Rural Communities: Views From the Great Plains. John C. Allen, Rebecca Filkins, and Sam Cordes. Presented at the Annual Rural Sociological Society Meeting in Washington, DC on August 13-17, 2000. Lincoln: Center for Applied Rural Innovation, University of Nebraska-Lincoln.
Building a Local Government Decision-Making Tool Kit -- The Oklahoma Experience. Gerald A. Doeksen. Paper Presented at Economic Conference in Kansas City, Missouri, November 7, 1997. 9 p. http://www.rupri.org/CPAN/publications/papers/doeksen97.pdf [PDF file]
Building Communities Together: Strategic Planning Guide. Washington, DC: U.S. Department of Housing and Urban Development, 1998. 81 p.
http://www.hud.gov/nofa/ez/stratpln.pdf [PDF file]
Community Guide to Development Impact Analysis. Mary M. Edwards. Madison: Wisconsin Land Use Research Program, University of Wisconsin-Madison, 2000. 111 p.
http://www.lic.wisc.edu/shapingdane/facilitation/all_resources/impacts/CommDev.pdf [PDF file]
Effective Strategies for Community Development Finance. Washington, DC: US Dept of the Treasury, Office of the Comptroller of the Currency, 2000. 2 v.
http://www.occ.treas.gov/cdd/strategy.pdf [PDF file]
Planning for the Future: A Handbook on Community Visioning. 2nd edition. Harrisburg: Center for Rural Pennsylvania, 2000. 39 p.
http://www.ruralpa.org/visioning.pdf [PDF file]
"The Power of Vision: Making the Strategic Plan Come Alive." Fred D. Baldwin. Appalachia, vol. 30, no. 3 (1997): 6-13.
Rural Infrastructure as a Cause and Consequence of Rural Economic Development and Quality of Life, Proceeding of a Regional Workshop Birmington, Alabama. February 1997. Edited by Joe Schmidt. SRIEG-16 Publication No. 5, SRDC Publication No. 207. Mississippi State, MS: Southern Rural Development Center, 1997. 144 p.
Strategic Planning and Performance Measurement. Pat Dusenbury. Governing for Results and Accountability, no. 4. Washington, DC: Urban Institute, 2000. 8 p.
http://www.urban.org/UploadedPDF/governing_4.pdf [PDF file]
"The 10-Point Test of Financial Condition: Toward an Easy-to-Use Assessment Tool for Smaller Cities." Ken W. Brown. Government Finance Review. December 1993: 21-26. http://gfoa.org/services/dfl/bulletin/BUDGET-Ten-point-test.pdf [PDF file]
Tools for Small Towns, by David Harris and Danielle Tanaka. Auburn, AL: Center for Government Services, 2002. 81 p.
http://www.auburn.edu/outreach/cgs/documents/RuralToolKit_tools_for_small_towns.pdf [PDF file]
Strategic Planning for Economic Development: Moving Beyond the Overall Economic Development Program. Washington, DC: Corporation for Enterprise Development, 1999. 79 p. http://www.eda.gov/ImageCache/EDAPublic/documents/pdfdocs/1g3_5f8_5fcfed_2epdf/v1/
1g3_5f8_5fcfed.pdf [PDF file]
Arkansas Financial Management Guide. Little Rock: Arkansas Department of Finance & Administration Office of Accounting, 2004. 234 p.
Best Fiscal Management Practices for Rural Schools, by Jerry Johnson and Greg Malhoit. Arlington, VA: Rural Trust Policy Brief on Rural Education, 2004. 31 p.
CGIAR Financial Management. Revised. Financial Guidelines Series, No. 1. Washington, DC: Consultative Group on International Agricultural Research (CGIAR), 1999. 25 p.
Executive Guide: Creating Value Through World-class Financial Management. GAO/AIMD-00-134. Washington, DC: U.S. General Accounting Office, 2000. 57 p.
http://www.gao.gov/special.pubs/ai00134.pdf [PDF file]
Financial Management Handbook for Small Community Water Systems, by Audrey Boe Olsen. New Prague, MN: Midwest Assistance Program, 1999. 55 p.
http://www.cdphe.state.co.us/wq/drinkingwater/TMFResourceDocs/FinMgmtHandbook.pdf [PDF file]
Financial Management Manual for Counties, Tribes, and 51 Boards. Madison, WI: Department of Health & Family Services, 1994.
Guidelines for Financial Management. Revised. Santa Barbara: University of California Santa Barbara, Office of the Controller, 2002. 79 p.
http://www.controller.ucsb.edu/ResourcesandPresentations/pdf/guidelines.pdf [PDF file]
Local Government Management Guide. Albany: New York State Office of the State Comptroller, 2003.
Touching All the Bases: A Financial Management Handbook for Your Wastewater Treatment Project. Washington, DC: US Environmental Protection Agency, 1986. 72 p.
http://www.epa.gov/owm/pdfs/scandoc/bases.pdf [PDF file]
U.S. Department of Agriculture
Economic Research Services
Appalachian Regional Commission
U.S. Department of the Treasury
Office Comptroller of the Currency
Federal Reserve Bank of Minneapolis
Community Transportation Association of America
Government Finance Review
Government Finance Officers Association
Journal of Extension
U.S. Cooperative Extension System
Journal of Regional Analysis and Policy
Center for Community Economic Development
University of Wisconsin Extension
Main Street Economist
Center for Study of Rural America
Federal Reserve Bank of Kansas City
Institute of Government
University of North Carolina at Chapel Hill
Regional Development Digest
NADO Research Foundation
Rural Development News
North Central Regional Center for Rural Development
Iowa State University
American Planning Association
1776 Massachusetts Ave., NW
Washington, DC 20036
American Planning Association (APA) is a nonprofit public interest and research organization that focuses on urban and rural
planning. Sixty-five percent of its members are employees of state and
local government agencies. APA also sponsors a professional organization, the American Institute
of Certified Planners.
American Society for Public Administration
1120 G St., NW, Suite 700
Washington, DC 20005
American Society for Public Administration is the largest professional association of practitioners,
teachers, and students of public administration.
Economic Research Service
U.S. Department of Agriculture
1800 M St., NW
Washington, DC 20036
(202) 694-5050 (customer service)
Economic Research Service (ERS) is a federal government agency within the U.S. Department of
Agriculture. ERS provides economic analysis on issues related to agriculture, food, the
environment, and rural development and publishes Amber Waves.
Financial Accounting Foundation
401 Merritt Seven
P.O. Box 5116
Norwalk, CT 06856
Financial Accounting Foundation (FAF) administers a Financial Accounting Standards Board and the Financial Accounting
Standards Advisory Council. FAF defines standards of financial accounting for state and local governmental entities,
operates a library which houses the National Automated Accounting Research System, and publishes Financial Accounting
Series and Government Accounting Series.
Government Finance Officers Association
203 N. LaSalle St., Suite 2700
Chicago, IL 60601-1210
Government Finance Officers Association (GFOA) is the professional association of
state/provincial and local finance officers in the United States and Canada. GFOA provides updates
on current events, innovations, and federal legislation affecting public finance management. GFOA publishes the Government Finance Review.
International City/County Management Association (ICMA)
777 North Capitol St., NE, Suite 500
Washington, DC 10002
International City/County Management Association (ICMA) is the professional and educational organization representing
appointed managers and administrators in local governments throughout the world. ICMA provides technical assistance,
training programs, and publications for
local government officials and acts as a clearinghouse for local government information.
National Association of Counties
440 First St., NW, Suite 800
Washington, DC 20001
National Association of Counties (NACo) is an organization of county officials from all parts of
the United States. NACo provides legislative, research, technical, and public affairs assistance
to its members; acts as a liaison with other levels of government; works to improve public
understanding of counties; and serves as a national advocate for counties.
National Association of Development Organizations
NADO Research Foundation
400 North Capitol St., NW, Suite 390
Washington, DC 20001
National Association of Development Organizations (NADO) is a public interest group which provides training,
information and representation for regional development organizations in small metropolitan and rural America. NADO
advocates a regional approach to community and economic development and provides a network for its members to share
ideas and innovations.
NADO Research Foundation publishes the Regional Development Digest and sponsors the Economic
Development Finance Service, which provides training and information on revolving
loan funds and other small business finance techniques.
National Association of Regional Councils
1666 Connecticut Ave. NW Suite 300
Washington, DC 20009
National Association of Regional Councils (NARC) is a nonprofit organization of regional councils, local government
organizations created by joint agreements of the local governments they serve. Regional councils study problems that face
an entire area and promote regional approaches to
their solution. NARC provides a forum for these councils to share information and support.
National Association of Towns and Townships
444 North Capitol St., NW, Suite 397
Washington, DC 20001-1202
National Association of Towns and Townships (NATaT), a nonprofit organization, is a
federation of state and municipal organizations which provides assistance on problems and issues
of importance to local governments. NATaT researches and develops policy recommendations
to support the interests of small communities, sponsors conferences, training programs and
annual meetings, and publishes a newspaper ten times a years and various specialty reports of
interest to local public officials.
National Center for Small Communities
444 North Capitol St., NW, Suite 397
Washington, DC 20001-1202
National Center for Small Communities (NCSC) provides the elected leaders of America's small communities with tools to govern effectively.
NCSC carries a technical staff, which can provide technical assistance and training programs, often in partnership with
state agencies, Extension Service staff, regional development organizations, and other nearby resource providers.
National League of Cities
1301 Pennsylvania Ave. NW Suite 550
Washington, DC 20004
National League of Cities (NLC) works on the development of national municipal policy for both large and small municipalities.
NLC represents the interests of cities and towns before congressional and federal committees, commissions, and hearings.
National Main Street Center of the National Trust for Historic Preservation
1785 Massachusetts Ave. NW
Washington, DC 20036
National Main Street Center works with communities to improve all aspect of their downtown or central business districts,
offering direct technical advice and assistance. The Main Street program aims to preserve the character of American communities by protecting and promoting the local business economy and preserving historic commercial architecture.
218 D St. SE
Washington, DC 20003-1900
Northeast-Midwest Institute is a nonprofit policy center that engages in research and education to promote the economic
and general well-being of the Northeast and Midwest areas of the U.S.
Urban and Regional Information Systems Association
1460 Renaissance Dr. Suite 305
Park Ridge, IL 60068
Urban and Regional Information Systems Association (URISA) is the professional organization of Information System Professionals
who work in state, regional, and local government. Members also include individuals from the hardware and software industries who are
interested in keeping informed of the needs of government officials.
USDA, Rural Information Center
National Agricultural Library
10301 Baltimore Ave., Room 123
Beltsville, MD 20705-2351