Cities continue to flounder in financial messes of their own making. They continue to spend more than they have, and the most common response is a predictable oneâ€“raising existing taxes or cooking up new ones.
Here's the ugly snapshot:
[According to a survey of 328 cities by the National League of Cities] more than four out of five finance directors surveyed (81%) said their cities were less able to meet financial needs compared with the previous year, the largest proportion since 1990.
Spending increases outpaced revenue increases in cities' 2002-2003 fiscal year by 3.1 percent compared to the previous year ...
City finance officers said the biggest negative factors affecting budgets were:
? Costs of city workers' health benefits (cited by 63 percent),
? Costs of city workers' pensions (30 percent),
? Reduction in state aid (29 percent),
? The local economy (25 percent), and
? Infrastructure needs (25 percent).
In response to the deteriorating fiscal condition of cities:
? Nearly half (47 percent) of all cities increased fee rates in 2003,
? 30 percent reduced city employment,
? 29 percent imposed new fees or charges on services,
? 21 percent reduced actual levels of capital spending, and
? 11 percent reduced city service levels.