Managing Local Intergovernmental Revenues: The Imperative of Diversification

Abstract

Municipal governments have employed a variety of strategies to address their ongoing revenue crises throughout the past several decades. One such strategy that has been employed with great consistency is the use of intergovernmental revenues (IGR). Given this trend, coupled with the fact that we know little about the dynamics of IGR, this paper presents one of the first multi‐year examinations of its use at the local level. Using data from 76 villages and cities in Cook County, IL (greater Chicago) for 1996–2000, we examine IGR use from the perspective of revenue diversification. The analysis indicates that during this period, local governments in Cook County (1) diversified their own‐source revenues and decreased dependence on the property tax; (2) maintained a consistent dependence on IGR; and (3) diversified and significantly altered their IGR structures. We also examine the demographic and organizational correlates of IGR diversification, and find it to be unrelated to characteristics such as population, property tax base, professional administration, and organizational capacity. As a result, we conclude that IGR diversification is a strategy that ought to be considered by all municipalities regardless of size or structure.     

The Flypaper Effect Revisited: Intergovernmental Grants and Local Governance

Abstract

Local governance arrangements shape the incentives of local actors, which may in turn influence fiscal choices. By emphasizing the role of local government institutions in local fiscal choices, we seek to bridge between median voter and Leviathan models prevalent in the literature. We then offer some preliminary evidence to support this explanation by empirically testing several propositions regarding the flypaper effect in intergovernmental grants. One limitation of the median voter model is that the model does not consider political institutions and their influences on government expenditures. In this study, we attempt to capture the influence of political dynamics in determining public expenditures by considering institutional variables. Test results show that the political institutional variables could be one of the explanation variables for the flypaper effect.     

Inside the Matrix: Integrating the Paradigms of Intergovernmental and Network Management

Abstract

The basic research concepts of intergovernmental and network management are examined with regard to blending the two into a unified theory of collaborative management. A substantial literature in both fields has emerged and is ripe for conceptually enhancing interorganizational management in the public sector. The collaborative management concepts forwarded emanate from the authors' comprehensive study of collaborative public management in 237 cities. The major concerns that are found to be ready for knowledge unification include: (1) multiple network complexity and the emergence of governance through policy networks, (2) strategic behavior and its implementation through networks, (3) the role of government institutions in network governance, and (4) the use of myriad policy instruments and multiorganizational activity. Each of these research arenas are representative of the kind of knowledge base that can be blended and extended to help public managers understand how to operate in the vertical/horizontal matrix of intergovernmental network management.     

A Survey of Perspectives on Intergovernmental Relations: A Comparative Analysis of the Czech and Slovak Republics

The results of a survey of local government officials from the Slovak and Czech Republics taken in December of 2005 are presented and analysed. Attitudes about and perspectives on intergovernmental fiscal relations in the two republics are probed. Differences and similarities in Czech and Slovak views are established regarding some of the perceptions of local autonomy and the sufficiency of available funds; whether or not public services are supplied by the appropriate levels of government; the potential benefits of adopting a serious rather than a nominal property tax; and the flexibility of local budget planning in Czech and Slovak cities and towns.