Many local governments today face a difficult dilemma: how to stretch a reduced budget to meet the growing demand for more and better services, comply with new regulatory requirements, and cover escalating pension and infrastructure costs. A range of new technology solutions may hold the key.
The financial crisis that devastated many businesses and homeowners also hit local governments hard, according to a report by the Pew Charitable Trusts. By 2009, state aid and property taxes, which typically make up more than half of local revenues nationwide, covered a smaller share of local expenditures than at any time since the U.S. Census began tracking those two funding sources in 1972. In fiscal year 2010, state funding and property tax revenue for local governments declined simultaneously for the first time since 1980.
An Ongoing Challenge
Although budgets have been increasing slowly over the past few years, they are barely outpacing inflation. Meanwhile, cities are being asked to 'do more with less' by lowering costs and increasing efficiency while expanding and improving their service offerings. Unfortunately, such demands coupled with reduced budgets often force local governments to make hard choices that lead to lost jobs and fewer services. For example, in 2011 Ohio state officials cut Cleveland's 2012 budget by $36 million, about 7 percent of the city's annual general fund revenues. To cope with the cuts, Cleveland laid off more than 300 employees ' more than half of them police officers and firefighters ' and left another 145 open positions unfilled. The city also shut down five fire companies and six trash crews. Asking residents to wait longer for garbage and recycling collection is bad enough, but no city should be forced to seriously compromise public safety and emergency response because of reduced funding ' especially when there are technology solutions that can help local government leaders avoid such dilemmas.