Go to Admin » Appearance » Widgets » and move Gabfire Widget: Social into that MastheadOverlay zone
The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.
By Roger Kemp
May 16, 2017
An Enterprise Fund is created when a public service generates sufficient revenues to pay for its cost. It is a simple concept, and one gaining in popularity among public officials in local governments throughout our national, because of:
… The nationwide aversion to increasing property taxes.
… The publics’ aversion to increasing revenues from other local forms of taxation.
… Fewer funds from our States and Federal Governments.
… Certain public services should not be subsidized by taxpayers who do not use them.
… A service that does not directly benefit the public should paid by the users.
… It is easier for politicians to raise user fees rather than increasing taxes.
Traditionally, several public services have been financed by Enterprise Fund revenues. Such as the following public services:
In recent years the following public services are increasingly being financed this way:
Under the Enterprise Fund financing concept:
It is usually more politically acceptable to raise user fees a little each year, rather than to have a larger user fee increase every few years. It makes sense not to have non-service user taxpayers pay for public golf course operations. It also makes sense not to have taxpayers that are non-boat-owners subsidize a municipal-owned marina. Only the users should pay for such services, since they are the only one benefiting from them.
The use of Enterprise Funds treats a public service as a “profit center” – where only the users pay for the cost of the service!
If you feel that the service only benefits those who use it, then the service may be suitable for Enterprise Fund financing. Think about it. This trend is here to stay!
Author: Roger L. Kemp, PhD, ICMA-CM, is a Professional in Residence, University of New Haven; and a Distinguished Adjunct Professor, Golden Gate University. Roger is also past-president of two state ASPA Chapters (The Monterey Bay Area, CA, and the State of CT).
Robert Chatenever
February 27, 2022 at 5:15 pm
If the enterprise fund for harbor operations levies a vessel tax in excess of the funds needed to operate the harbor, can those funds then be used by the general fund?