Debt Limits and Borrowing Patterns in Twelve Southeastern States: Where There's a Will….

Abstract

Each year thousands of professional public administrators are taught the principles of capital budgeting and bond finance even as state legislatures move to restrict the ability of those administrators to practice what they have learned. The local borrowing decision is increasingly made at the ballot box, where cost‐benefit analysis is not as important as a good advertising campaign. Public administrators have long recognized that more democracy may mean less efficiency. This review of the way twelve southeastern states responded to borrowing restrictions, especially referenda requirements, suggests that the imposition of such restrictions may achieve results that are neither democratic nor efficient.