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Government Revenue Stabilization Program

You are the Assistant City Manager for Centropolis, a city of 500,000 people in the Midwest region of the United States. The City employs 6,000 people in 25 departments, with a budget of more than $1 billion. Centropolis is the core of a metropolitan area with a population of almost two million people. The city shares borders with many other jurisdictions, including a booming group of suburban communities. Centropolis itself has recently undergone a downtown redevelopment and moderate population growth.
Within its 300 square miles, Centropolis is diverse in development patterns (ranging from urban core to first ring suburb to new growth suburb) as well as population demographics. Likewise, the city draws its revenues from many sources, including taxes (property, earnings, utility, sales) and fees. Like many other local governments during the economic downturn, Centropolis feels pressure from citizens to reduce or eliminate revenue sources, while maintaining or increasing service levels. The City seeks to stabilize its revenue outlook, particularly for its General Fund, which is the primary source of funding for administration, public safety, solid waste, streets, parks and code enforcement.

Draft a memo to the City Manager on your approach to stabilizing General Fund and other revenues while remaining responsive to citizen concerns. Include consideration of management, budgetary and political implications of your approach, as well as how your suggestions would impact the public and other external stakeholders.

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FOR: The Manager, Centropolis City
FROM: Assistant City Manager and Chairman, Finance Committee
SUBJECT: Proposed City General Fund and Other Revenues Stabilization Program
DATE: 29 January 2011


Part of the functions of the committee in which I was designated to lead is fund acquisition and allocation. While there have been no major problems in the past, the recent downturn in the economy adversely affected the capacity of our constituents to purchase their basic necessities. From the dialogues regularly conducted with with non-government organizations, the undersigned was informed of demands by some sectors that tax rates and other fees collected be reduced. This would mean a considerable deduction from expected revenue collections and would ...

Solution Summary

A proposed program that aims to stabilize the General Fund and other revenues of a developing city, while remaining responsive to citizen concerns.