An Assessment of Local Revenue Mobilaztion And Expenditure Management Efforts: With Particular Emphasis to City Administration of adama

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Date

2007-07

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Addis Ababa University

Abstract

This study exammes the local rcvcnu e mobilization and expenditure management efforts of City Admi n is tration of Adama using municipal revenue and expendi ture a nalysis to identify the magnitude of the problem of urban fin a n ce. Qu a li ta tive and quanti tative d a ta were colleted form s econdary and primary so urces . Revenue and expenditure reports, plan and budget documents both from Regional and City Administra tion level, interviews and questionna ires a re major sources of the data. The evidence in the study leads to conclusion that the city Administration of Adama is s hort of efforts to mob ilizc its local revenue potential and the expenditure ma n agement a ppears to be in-a ppropria te . The expenditure management is faced by problems of capital budget under spending, low level of municipal services provision a nd the existence of huge surplus fund. Pa radoxically enou gh, the City Admin is tra tion Adama is cha ra cterized by low level of urban services provision a t the pres ence of huge surplu s fund accumula ted over a decade. Furth er , the findings of the study revealed tha t the exis te nce of fiscal gap in City Adminis tration 's finance. Revenue enhan cemen t plan based on improvemen t of tax a dminis tration system, municipa l borrowing for ca pital fina n cing, pUblic-private partnership options in providing services, in tergovernmental tran s fer restructured in u rban setting, revis ion of user ch arges and fees and introduction of new municipa l taxes are th e a lternatives recommended to fill the fiscal gap.

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Keywords

Local Revenue Mobilaztion

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