Local Government Finances with Derek Mobley | Ep. 78

• Derek explains that in the U.S., states are the foundation of government. Cities and counties are created by state legislatures, which also grant them taxing authority.

• Primary revenue sources include property taxes, usage fees (like water bills), sales taxes, and grants from state/federal levels.

The city and local governments, the way they're primarily financed is number one, you know, property taxes... They also charge you different fees for the services they provide... And then they can also do things like sales taxes.

• For issues like property taxes, start at the local level by engaging elected officials or supporting candidates. For broader policy changes, state legislators can pass laws affecting taxation or services across jurisdictions.

I would definitely say you start at the local level.

• Unlike the federal government, local governments must balance their budgets each year. If revenue is insufficient, services get cut. Local budgets are relatively transparent, often published in a few hundred pages.

• Residents can review budgets and water bill inserts to understand upcoming changes and service impacts.

• Bonds function like loans for large projects (e.g., school construction). They require voter approval via referendum and are repaid from future tax revenue.

If you vote for more spending and not higher taxes, you're kind of voting for cutting services somewhere else.

• Example: A school bond passed without a corresponding sales tax increase, potentially forcing future service cuts to repay the debt.

• Grants from state and federal governments help fund local programs like senior transportation. These funds often flow through counties, which administer services like Medicaid and social programs.

• City vs. county roles can overlap or require coordination, especially for shared infrastructure like roads.

• Macro: National policies like interest rates and deficits. Micro: Local program effectiveness and individual impacts (e.g., modeling WIC or food stamp outcomes).

• Understanding both helps residents anticipate economic shifts and adjust personal finances accordingly.

• From Adam Smith's Wealth of Nations (1776) challenging mercantilism, to the Great Depression prompting more government intervention, economic thought has evolved around the role of government in markets.

• COVID stimulus is the latest example of intervention, with potential long-term effects like inflation still unfolding.

• Derek is running for Guilford County Commissioner in District 3, motivated by concerns over education funding, economic development, and stagnant median incomes.

• He encourages involvement in local government and notes the importance of school boards in education policy.