Beverly A. Cigler

The County-State Connection: A National Study of Associations of Counties

importantpart of the rethinking and restructuring ofgovernment in the 1990s, and this research helps shape the discussion. Interest is growing in the roles, responsibilities, and performance of the nations 3,042 counties as they assume increasing responsibilities in the federal system. National associations representing local governments (e.g., National Association of Counties [NACo], International City/County Management Association [ICMA]), the U.S. Advisory Commission on Intergovernmental Relations (U.S. ACIR), several state ACIRs, and the National Civic League (NCL) have shown interest. A wide variety of journal articles, symposia, and edited books have been published on aspects of county government in the last five years (Menzel et al., 1992; Berman, 1993; Thomas, 1993). The University of Arizona and Penn State Harrisburg have hosted recent conferences on statecounty relations.

Service Challenges and Governance Issues Confronting American Counties in the 21st Century: An Overview

The American county?long consid ered to be the bedrock of local gov ernment in the United States?has grown in importance since the middle of the 20th century. Between 1962 and 2002, the county government share of county and municipal revenues grew from 39.3 to 47.3 percent, and expenditures grew from 33.7 to 46.5 percent. As a consequence of this substantial growth in county financial activity, there has been a con comitant and stunning increase in the types and level of county government services. Re latedly, the county workforce has increased dramatically, more than tripling in size from around 700,000 full-time equivalent employ ees in 1962 to 2.3 million in 2002. In 2002, county employees accounted for 48.6 per cent of the county and municipal workforce compared with 35.7 percent in 1962. Today, counties employ almost as many people as do municipalities. Coincident with this growth, American counties face a number of challenges as ser vice-delivery agents and instruments of gov ernance in the early 21st century. Viewed from a global perspective, perhaps the most daunting challenge is whether or not coun ties can meet the myriad and far-flung expec tations that accompany the service roles coun ties are expected to play. A growing number of county governments must simultaneously function as traditional, local, and regional governments (see Benton 2002a). As tradi tional governments, counties serve as ad ministrative or political arms of their state governments and thus perform a number of state functions (many of them mandated) and services to all county residents.1 When counties function as local governments, they provide municipal-type services to residents of unincorporated areas.2 In addition, densely populated counties often serve as regional governments when they provide urban-type services to residents of both unincorporated and incorporated areas.3 This enlargement of the service role and prominence of counties and the wholly new approach to daily operations that is required means that county governments must deal with several governance issues. Indeed, these issues are part and parcel of the very essence of counties as they strive to provide tradi tional as well as municipaland urban-type services and meet the heightened expecta tions of democratic governance. As function ing full-service governments, three questions in particular are salient. First, what is the most suitable form of county government in terms of responsiveness to escalating service expectations and ability to negotiate with

U.S. Floods: The Necessity of Mitigation

Floods are the costliest natural hazard events in the United States in terms of lives and property losses. The financial costs of flood disasters are unsustainable, especially for the national government, which assumes the most costs while state and local governments have the greatest ability to avoid great losses due to their influence over land use, economic policy, and other areas that can help mitigate floods and reduce the high costs of relief and recovery. This article summarizes the types, causes, and occurrence of floods in the United States and their unsustainable economic and social costs. It explains that the growing burden to taxpayers from disaster response and recovery has resulted in increased interest by national decision makers in shifting more disaster responsibilities and costs to state and local governments. The article reviews the broad tool kit of mitigation strategies available to local governments and their residents in taking greater responsibility for the impacts of flood events.

Fiscal Effects of Local Government Boundary Adjustments

This chapter focuses on the effects of local government boundary adjustments on local finances. The topic deserves special consideration because boundary adjustments are very common and their fiscal implications are complex and sometimes unexpected. The chapter presents a detailed case study of an actual consolidation to show how the fiscal effects of the consolidation were projected and what actually happened after the consolidation occurred. The case study is presented to show how a simple, straightforward analysis can be done and to illustrate the impossibility of making precise, accurate predictions beforehand. The case study shows how two small cities implemented their consolidation. The case study provides a framework for projecting the fiscal and serviced impact of consolidation and validated the projections through post-consolidation events. The results show that it is possible to project the impacts of a municipal consolidation on public services and finance by using data from the former cities and making realistic assumptions.

Analysis and Interpretation

This chapter focuses on analysis with interpretation rather than just quantitative methods or straightforward numerical assessment. The difference between the two approaches to fiscal health analysis can mean the difference between a generic representation of local government finances, one that could seemingly have been conducted in a near automated fashion, and one that is a true representation of the complete fiscal condition of the local government. The chapter discusses numerous quantitative measures that are derived by using the three tools: ten-point test of fiscal condition, the financial trend monitoring system, and fiscal capacity analysis. Throughout the chapter application of the three tools and interpretation of their results revolve around examples from case studies of three fictitious local governments, each comprising a different economic base, population demographics, and consequently with their own unique set of fiscal challenges. Accompanying those measures is a brief summary of the context of the local government.

Macro Trends Affecting Local Governments

This chapter examines the macro trends that continue to affect the changing local, political, social, and economic environment. Local governments will look different in the future, and there may be fewer general-purpose local governments although special-purpose governments may continue to proliferate. Greater use of a variety of alternative service delivery mechanisms means that local governments will focus more on results not on processes. Local governments will need to be more concerned than ever about financing, monitoring, and evaluating. The big questions about local governments and their relationships with other governments and sectors involve who should do what, when, where, why, and how. These are highly contentious topics and the future is uncertain. Local government is in a long-term trend toward more professionalization of their management, technical, and financial responsibilities. The financial tools contribute to improved capability for dealing with the myriad of challenges facing local officials.

Tools for Analyzing Local Fiscal Health

This chapter discusses the three of many possible tools to analyze fiscal health, the ten-point test of fiscal condition, the financial trend monitoring system, and fiscal capacity analysis given the relative simplicity and ease of implementation of the three tools. In addition, the three tools have fairly modest data requirements for conducting the analysis of fiscal health. Periodic application of these tools can help a local government maintain a clear perspective on current or impending distortions in fiscal condition. Given the relative ease in conducting such an analysis, the burden for maintaining an ongoing review of fiscal health should be minimal. It is expected that this ability to monitor fiscal condition, preferably on an annual basis, will prove to be a cost-effective method of proactively maintaining fiscal health and fiscal direction long into the future. As with any type of fiscal analysis, extraordinary circumstances unique to the local government can easily explain what at first glance may seem to be an alarming analytical result.

Alternative Service Delivery Options

This chapter discusses an important type of expenditure reduction strategy, the use of alternative service delivery (ASD) options to reduce expenditures and achieve efficiency in the delivery of services. ASD tools were selected as a focus because of their variety and potential for achieving expenditure reduction. Cost savings through the use of ASD tools is a valuable way to enhance revenues without raising taxes, cutting services, eliminating positions, or employing other usually undesirable measures. However, turning to ASD options without first performing the needed analyses for ensuring success or entering into new agreements without careful monitoring and other safeguard could worsen the local revenue situation. Careful contract development, issuance of bids, and contract monitoring need not always be tied, either, to expensive legal assistance.

Fiscal Health Literature: Drifts and Reflections

The fractionating of literature across many disciplines stems from different purposes of the writers. Some authors have attempted to instruct or give practical advice to local governments on how to maintain and enhance their fiscal health. Others are more concerned with exploring the concept of fiscal health and the implications of using various definitions for research and practice. Some writers have also focused on the measurement of fiscal health. This chapter summarizes numerous perspectives on how to quantify a local governments fiscal health through various proposed indicators. There is a substantial literature on the factors influencing a governments fiscal health. There are also writings on the influence of fiscal health on other topics of interest to communities.

One – Introduction and Overview

Publisher Summary From the local government perspective, many things beyond the control of local officials have major effects on local finances. These include policies by higher levels of government; natural phenomena, such as weather and disasters; the overall state of the economy; and economic development policies of neighboring states. The fiscal managers work is to figure out what factors are truly beyond the scope of his or her influence and control versus the things he or she can do immediately and on an ongoing basis to improve their fiscal health. To have the capacity for fiscal health, local decision makers must have the ability to anticipate or think ahead about what will affect their finances over time. These influences include everything from demographic and climatic changes to changing demands for local services to changes in intergovernmental fiscal relationships. Local officials create policies that may enhance or hurt fiscal health. These policies may be geared toward economic development and public services that indirectly affect fiscal health or they may be explicitly designed to affect local finances. The programs that are developed and implemented rely on resources that must be absorbed by the government and managed well in order to be effective. In addition, continuous monitoring, improvement, and adjustment of policies help keep the fiscal health of local governments on track.