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City Finances, City Futures.

This publication is Volume 2 of The Challenge of a New Century: The Future of America's Cities, a joint effort of the Ohio Municipal League and the National League of Cities. The publication includes the primary author's work and comments related to the author's theme provided by three urban practitioners and observers: Roy Bahl, professor of economics and director of the Policy Research Center, College of Business Administration, Georgia State University; Peter A. Harkness, editor and publisher of Governing magazine; and John Petersen, president of Government Finance Group, Inc. and former staff member of GFOA. The underlying purpose of this book is to stimulate the reader to envision how the future cities will be financed. The author's introduction of the theme starts with a presentation of urban area statistics related to the country's largest cities. Per capita data by region of the country and by largest city in each state conclude that most wealth exists in the urban area surrounding a city. This is not a new revelation to those in large, mature cities.

Additional opinions on future federal or state assistance, the current composition of revenues with suggestions for the future, the expected fate of tax-exempt bonds and potential financial consequences of fiscal failure all lead into the author's conclusions concerning positioning for the future. He introduces eight elements that may help establish a sound fiscal strategy for the future city; these elements include tapping the full urban economic base, preserving infrastructure maintenance and development, improving property tax structures and administration, using broad sales and individual income taxes, and nonreliance on increases in federal assistance.

Undoubtedly, the author has not provided all of the answers, and the commentary of the reviewers clearly evidences differences of opinion, as well as new opinions concerning the fiscal course of the future city. The comments of John Petersen are the most pointed toward cities as we know them. One thing for sure is that there is no cookbook of solutions.

For those who have been involved in municipal finance for the past 20 or more years, it is easy to identify with the "shutting off of the federal financial faucet" and the federal government's consistent actions to "eliminate the tax-exempt status of municipal bonds." Both areas will continue to require supportive efforts from the state and local government levels so that the potential financial squeeze from these two resources does not materialize.

The book is an easy read. It offers a composite of the changes in urban economics in the decade of the 1980s and predictions for the 1990s and beyond. City administrators need to formulate strategies to assure their financial viability in the next century. The National League of Cities and the Ohio Municipal League's series are well on their way to succinctly stating the challenges to and ideas for such strategies.

City Finances, City Futures is available for $20 for NLC members ($30 for nonmembers), plus $4 shipping and handling, from the National League of Cities Publication Center, P.O. Box 491, Annapolis Junction, MD 20701 (301/725-4299).

Reviewed by John L. Andreyko, deputy director of finance, City of Cincinnati, Ohio, and member of GFOA's Committee on Governmental Debt and Fiscal Policy.
COPYRIGHT 1994 Government Finance Officers Association
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1994 Gale, Cengage Learning. All rights reserved.

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Author:Andreyko, John L.
Publication:Government Finance Review
Article Type:Book Review
Date:Feb 1, 1994
Words:531
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