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Distressed municipalities that receive over $100,000 in additional aid are required to use the AIM funding to: (i) minimize or reduce the real property tax burden; (ii) invest in economic development or infrastructure to achieve economic revitalization and generate real property tax base growth; or (iii) support investments in technology or other reengineering initiatives that permanently minimize or reduce operating expenses.

In addition, these municipalities are again required to submit a comprehensive fiscal performance plan (PDF) to the Director of the Budget and the Office of the State Comptroller within 60 days of their adopted budget. The plans include:



* A multiyear financial plan;
* A fiscal improvement plan that includes key fiscal performance goals and action plans necessary to achieve long term fiscal stability; and
* A fiscal accountability report that describes accomplishments toward achieving efficiency and improvements, and that details how AIM funding has been spent.








he Office of the State Comptroller is authorized to perform compliance reviews of the accountability requirements, and may recommend the withholding of AIM funding to municipalities that do not comply.

As an accountability measure, cities with additional aid under $100,000 that receive inflationary increases and large villages that meet all four fiscal distress indicators are required to prepare multiyear financial plans.

The 2008-09 Enacted Budget expands local reporting requirements to further improve local fiscal management practices and transparency. All municipalities will be required to post financial reports on their websites, including their most recent budget, independent audit, and multiyear financial plan.



Local Government Efficiency Grant Program

The 2008-09 Enacted Budget creates a new Local Government Efficiency Grant (LGEG) program based on the recommendations of the Commission on Local Government Efficiency and Competitiveness. This new program, funded at $29.4 million, restructures the current Shared Municipal Services Incentive program with enhanced focus on consolidation and major service sharing arrangements that will save taxpayer dollars. The program features new 21st Century Demonstration Projects that will support countywide or regional service models in areas like education, highway maintenance, policing and smart growth planning. LGEG also places greater emphasis on service and governmental consolidations, program evaluation, technical assistance and new State agency efforts to achieve local efficiencies. These grants will be administered by the Department of State.