Thomas F. Stinson
Fiscal Status of Local Governments
Local government services make a major contribution to the quality of life in rural America. Citizens demand education, health care, and public safety just as they demand food, clothing, and housing; and the location of industries and households is said to be influenced by both the quality and the cost of local public services. Although the financial problems of the large central cities and the metropolitan areas have been well publicized and the subject of much research, surprisingly little is known about the finances of smaller local governments.
Research has been limited by problems of measuring service quality, fiscal capacity, and tax effort, just as it has in the urban areas. The lack of a consistent set of annual data has been still another constraint. The Census of Governments, conducted once every five years, is the only source of detailed, consistent national data on the finances of small cities, counties, and school districts. This data limitation has resulted in a concentration and perhaps overanalysis of the status of local government finances during census years, with little attention paid to long-term trends.
This chapter follows that same tradition. It offers no answers to the question of whether rural local governments faced more serious financial problems in 1977 than they did in 1962 or 1972. Instead, it reviews and updates basic information about the finances of smaller local governments. An update seems particularly important now, because several major changes have occurred since 1972 in the institutional____________________