CBO Issues Brief Roadmapping Bankruptcy Paths for State & Local Governments

December 10th, 2010
in News, Background

The Congressional Budget Office has issued a brief describing the economic conditions and budgeting practices that can lead to significant budgetary challenges--often termed fiscal stress--at the local level. The brief also reviews the options available to local governments, state governments, and the federal government for addressing such financial difficulty. Last, the brief examines two options that local governments very rarely use: defaulting on their debt or filing for bankruptcy.

Follow up:


Local governments--including counties, cities, towns, school districts, and special districts--play a significant role in people's lives and in the nation's economy. In 2009, the expenditures of local governments equaled 8.7 percent of gross domestic product, and those governments employed just over 9 percent of the labor force. That year, local governments as a group cut their spending in real (inflation-adjusted) terms. This year and in upcoming years, they expect to constrain spending and services--primarily because of reductions in state aid and falling revenues. In particular, revenues from property taxes are poised to decline to reflect lower property values. To the extent that local governments address budget gaps by reducing spending or raising taxes, such changes will partially counteract the federal government's fiscal support for the economy.

Complete report: click here

Make a Comment

Econintersect wants your comments, data and opinion on the articles posted. You can also comment using Facebook directly using he comment block below.

 navigate econintersect .com


Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day


Asia / Pacific
Middle East / Africa
USA Government

RSS Feeds / Social Media

Combined Econintersect Feed

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution



  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2018 Econintersect LLC - all rights reserved