A Recipe for Fiscal Trust

Local governments need to make significant financial investments, and must raise revenues through taxes, user fees, and possibly new revenue tools. But before they can take these actions, they have to build trust to convince their residents that new revenues are needed and will be spent wisely. What does it mean to build trust? This paper examines the notion of trust and how governments can build it using:

• Good information: relevant data made accessible to citizens and attractively packaged to enhance transparency
• Good communications: good stories that are well told, with relevant information distributed through a variety of channels (using open government tools and techniques)
• Good engagement: inclusive and meaningful opportunities for dialogue about policy decisions to build the continuum of trust (using a variety of mechanisms)
• Credibility: building an effective track record and controlling costs (through better performance benchmarking and other approaches)
• Earmarking of funds: creating a dedicated fund that clearly links revenues raised to specific expenditures, and regularly reporting on the progress of projects funded