Governments frequently use financial incentives to encourage the creation, expansion, or relocation of businesses within their borders. Research on financial incentives gives little clarity as to what impact these incentives may have on governments. While incentives may draw in more economic growth, they also pull resources from government coffers, and they may commit governments to future funding for public services that benefit the incentivized businesses. The authors use a panel of 32 states and data from 1990 to 2015 to understand how incentives affect states’ fiscal health. They find that after controlling for the governmental, political, economic, and demographic characteristics of states, incentives draw resources away from states. Ultimately, the results show that financial incentives negatively affect the overall fiscal health of states.

Tax and expenditure limits (TELs) are restrictions placed on governments limiting their ability to collect and spend revenue. Residents support these TELs, as they desire lower tax burdens and more government efficiency; yet, residents still desire the same level of public services. Property tax rate limits, a specific type of TEL, are placed upon local governments to limit their ability to collect revenue and expand authority. Rate limits were implemented on the assumption that governments would tax at their highest maximum possible rate, but this is not always the case. This article studies why some local governments choose not to utilize their maximum allotted property tax rate. Using an open systems governance approach, a panel data analysis was conducted using data from 67 Florida counties from 2008 to 2017.Results of the analysis show that the use of special districts and the age of the residential population have significant effects on property tax rate decisions. | INTRODUCTIONTax and expenditure limits (TELs) are restrictions on governments that limit their ability to collect and spend revenue.Property tax TELs come in various forms, including assessment limits, levy limits, and rate limits (see Mullins & Joyce, 1996). Although each type of property tax TEL operates in different ways, all serve to limit local government revenues and expenditures and control the growth of local government authority (

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For the past seven years, the state spent more from the General Fund than its tax structure generated. To help cover the difference, the state borrowed from institutional investors. Should Californians be concerned? More broadly, how does debt fit into the annual budget debate? Evaluation of debt loads help Californians assess the fiscal prudence and sustainability of the state's fiscal structures.