The role of special districts and intergovernmental constraints

Christopher Goodman

Chapter 9 in Research Handbook on City and Municipal Finance, 2023, pp 173-186 from Edward Elgar Publishing

Abstract: Special districts are commonplace in U.S. local governance; however, they often provide services that other forms of local government provide. This chapter poses two questions: why do special districts exist, and what are the implications for local fiscal outcomes? The main conclusion is that special districts exist because they are highly adaptable, particularly in potentially circumventing state fiscal restrictions. This adaptability makes them attractive to solving problems at both the sub-city and extra-city levels. Generally, the literature agrees that the proliferation of overlapping special districts inefficiently increases the size of the local public sector far beyond the size demanded. The connection between special district growth and the objectives of state fiscal restrictions is an essential missing link in state policymakers’ thinking about the efficacy of such rules.

Keywords: Economics and Finance; Politics and Public Policy Urban and Regional Studies (search for similar items in EconPapers)
Date: 2023
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