Intergovernmental Fiscal Relations in California: A Critical Evaluation

This chapter provides an overview and evaluation of state and local finance in California. This evaluation may be timely, since national and state policy makers have again raised the issue of intergovernmental fiscal reform. Initiatives at the national level include the “New Federalism” of the Nixon and Reagan administrations, as well as more recent proposals by the Clinton administration and the Republican opposition to devolve the welfare function to state governments. The National Council of State Legislators has recommended that state governments reexamine the assignment of fiscal powers between state and local government. At the same time, policy makers in many other nations have expressed interest in governance reform, and particularly in decentralization of fiscal functions.