City Fiscal Conditions in 2010

City Fiscal Conditions in 2010

Weaknesses in the housing and retail markets continue to stress municipal budgets and promise continued fiscal challenges to local governments in 2011 and beyond, a new research brief from the National League of Cities finds. According to City Fiscal Conditions in 2010 (8 pages, PDF) — the league's annual survey of city finance officers — 87 percent of cities reported they are worse off financially in 2010 than they were in 2009, with revenues from property, sales, and income taxes expected to fall 3.2 percent in inflation-adjusted dollars, the fourth consecutive year of declining revenue. To balance their budgets, cities have made the largest cutbacks in spending in the survey's 25-year history, with expenditures dropping some 2.3 percent through layoffs, delayed or canceled capital projects, and/or modifications in health benefits. As a result, many cities are revisiting the range of services they provide and looking for new service-delivery models to minimize the impact of further cuts on residents.