Revenue Source Trends and Changes in Local Governments: A Case Study of Georgia
Keywords:
Local revenue sources, revenue diversification, special purpose local option sales tax, user feesAbstract
Financial stability poses a considerable challenge for many local governments, particularly during periods of resource unpredictability. While diversifying revenue sources is frequently touted as a remedy for fluctuating revenue streams, limited research has delved into the specific new revenue modalities adopted by local governments and how these have transformed their overall revenue structure. This research evaluates revenue diversification trends by analyzing revenue data spanning 1985 to 2015 from 121 of Georgia's largest cities. Findings indicate that special purpose option sales taxes emerged as a significant addition over the three decades. Concurrently, a growing number of local governments have embraced sources like hotel/motel taxes, business licenses, alcohol licenses, and parking fees. Notably, in a majority of the cities studied, revenues from enterprise funds surpassed those from general funds. The study concludes by drawing financial management implications from the observed trends.
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