New York State's constitutional debt and tax limits on its substate governments have been praised as ensuring the fiscal solvency of local governments and the State. However, critics charge that they exert disproportionate burdens upon certain local governments and that sophisticated circumventions of the limits result in financial mismanagement.; Purpose and methodology. No existing study examines debt and tax limits in relation to the overarching concept of local discretionary authority ("home rule"). This dissertation attempts to begin to fill this gap in the literature.; We analyze thoroughly the legal environment and the interest group pressures that have helped to shape New York State's peculiar political culture as to the state-local relationship generally and the state-local fiscal relationship in particular. Additionally, we surveyed city and village mayors to determine the impact of the limits upon their financial practices and service provision priorities and to ascertain these officials' views as to the optimal system of state oversight of local finance.; We also evaluate New York State's limits in accordance with the criteria of (1) rationality, (2) equity, (3) efficacy, and (4) responsiveness.; Findings. Local discretionary authority varies widely among the fifty States and reflects each State's political culture and the relative strengths of the concerned interest groups in that State. Although New York is a "constitutional home rule" State, finance always has been an excluded area as a result of the success of taxpayer and municipal creditor pressure groups in the constitutional revision process.; Moreover, neither state legislation nor judicial decisions have broadened local fiscal powers significantly, and local officials also have been reluctant to endorse elimination of restraints on their fiscal authority. This particular aspect of New York's political culture explains the current state-local fiscal relationship and acts as a constraint on efforts to reform it.; We conclude that New York State's limits are (1) structured irrationally, (2) inequitable as they constrain local governments unevenly, and (3) inefficacious in that they discourage, rather than promote, sound local financial management systems. We were unable to form a definitive judgment regarding the responsiveness criterion.; We recommend the repeal of New York State's constitutional debt and tax limits and suggest the following statutory modifications of the state-local fiscal relationship: (1) state-authorization of advisory--as opposed to control--boards to assist financially-stressed local governments, and (2) partial state reimbursement of compliance costs of certain state mandates on local governments.
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