Rural Governments: Raising Revenues and Feeling the Pressure

Some local governments in nonmetro areas--especially those in the rural West and in highly rural areas--experienced high levels of fiscal stress in the midseventies that were associated with high and rising local taxes. These local governments may be forced to cut back their rural development activities in the eighties. This report looks at locally raised general revenues as a percentage of local income to assess the fiscal pressures local governments face in their efforts to raise revenues. Such revenue efforts increased in many rural areas whose income and population declined. The high cost of providing public services in sparsely populated areas contributed substantially to rural fiscal pressure.