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Article: A capital budgeting methodology for a small town. (Spotlighting Small Governments)
- Article from:
- Government Finance Review
- Article date:
- April 1, 1993
- Author:
CopyrightCOPYRIGHT 1993 Government Finance Officers Association. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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A problem faced by many local governments is to provide a stable level of services to a growing population without continually accelerating tax increases. The normal practice to accommodate growth is to wait until capital expenditures are required and then either raise taxes or float a bond issue to pay for them. This "incremental" spending approach generally results in abrupt increases in taxes, causing voter resentment and making it difficult for local governments to function effectively.
Good planning for growth can balance revenues and expenditures over long periods and reduce costs to taxpayers, as well. This article describes the financial planning methodology ...