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Guide to Local
Government
Finance in
California
Guide to LocaL Government Finance in caLiFornia
Chapter 4. The General Fund: The Flexible Fund ...................................... 31
What Municipal General Funds Pay For ....................................................... 31
Sources of Money for the General Fund ...................................................... 32
Taxes ................................................................................................................... 32
Fees ..................................................................................................................... 40
Other General Fund Revenues ....................................................................... 41
Summing Up ...................................................................................................... 42
Chapter 5. Special Revenue Funds: The Inflexible Funds .......................... 45

Local Special Taxes ........................................................................................... 45
State Subventions .............................................................................................. 46
Community Development Block Grants (CDBG)
and Other Grants ............................................................................... 49
Development Impact Fees .............................................................................. 49
Summing Up ..................................................................................................... 50
Chapter 6. Enterprise Funds: The Business-like Funds ............................. 53

What Is a Local Government “Enterprise” Service? .................................. 54
Setting Rates ...................................................................................................... 56
Rate Review Frequency .................................................................................... 58
Rate Structure .................................................................................................... 59
Rate Setting Policy ............................................................................................ 61
Rate Approval .................................................................................................... 62
Revenue Collection ........................................................................................... 63
Summing Up ...................................................................................................... 64
PART III
THE PRACTICE
Chapter 7. Budgets and Fiscal Policy: Allocating Resources

and Ensuring Financial Health ....................................................... 67
Requirements for Adopting Budgets and Financial Plans .......................... 67
Budget Preparation ........................................................................................... 68
Approaches to Budgeting ................................................................................ 69
Traditional Versus Emerging Budget Practices ............................................ 75
The Importance of Public Policy in Resource Allocation ......................... 78
Gauging a Local Government’s Financial Health ........................................ 83
Summing Up ...................................................................................................... 89
Chapter 8. Labor: Employing People .......................................................... 93

The Cost of the Workforce ............................................................................. 93
How Compensation and Benefit Levels Are Determined ......................... 95
Labor Relations and Collective Bargaining ................................................... 99
Major Compensation Issues: Pensions and Retiree Health Costs ........... 104
Adding It Up: Estimating the Cost of the Workforce .............................. 109
Strategies for Containing Workforce Costs ................................................ 110
Summing Up .................................................................................................... 112
viii
contents
Chapter 9. Purchasing: Buying Things and Contracting
for Services ..................................................................................... 115
Placing Purchasing in Context ...................................................................... 115
Basic Purchasing Tasks .................................................................................. 116
Emerging “Best Practices” ............................................................................ 117
Summing Up .................................................................................................... 123
Chapter 10. Capital Improvements and Debt

Financing: Building Things .......................................................... 125
Capital Improvement Plans ........................................................................... 125
Paying for Capital Improvements ................................................................ 126
Major Types of Debt Instruments for Local Agencies in California ..... 130
Summing Up .................................................................................................... 136
Chapter 11. Investiments: Managing the Public’s Portfolio ...................... 137

Fundamental Principles for Investing Public Funds ................................. 137
Surplus Funds: Why Do They Exist? .......................................................... 141
Investment Authority ..................................................................................... 142
Investment Management ............................................................................... 143
Investment Policies ......................................................................................... 144
Investment Oversight Committees .............................................................. 151
Reporting ......................................................................................................... 152
Summing Up .................................................................................................... 153
Chapter 12. Reporting: Accountability and Telling

the Financial Story ......................................................................... 155
Fund Accounting Concepts .......................................................................... 155
Annual Reports ............................................................................................... 156
Interim Financial Reporting .......................................................................... 160
Summing Up .................................................................................................... 161
PART IV
DEVELOPMENT AND MUNICIPAL FINANCE
Chapter 13. Local Economic Development: Fostering

Business Vitality ............................................................................ 165
Reasons for Economic Development ......................................................... 166
Thinking about the Local Economy ........................................................... 167
Business Attraction ........................................................................................ 169
Economic Development Strategic Planning .............................................. 170
Tools of the Trade .......................................................................................... 174
Redevelopment ................................................................................................ 178
Summing Up .................................................................................................... 182
Chapter 14. Real Estate Development Feasibility and the

City as Developer: Perspectives and Roles .................................... 185
The Developer’s Perspective ......................................................................... 185
ix
Different Kinds of Feasibility ....................................................................... 186
Players in the Development Process ........................................................... 188
Capital Requirements ..................................................................................... 191
Debt Financing ............................................................................................... 192
Financial Feasibility ........................................................................................ 194
Market Studies ................................................................................................. 197
Local Government as Developer ................................................................. 199
Partnering with the Private Sector: It’s Complicated ................................ 201
Managing the Complications and Risks ...................................................... 202
Summing Up .................................................................................................... 206
Chapter 15. Fiscal Impact Analyses: Costs and Revenues

of New Development .................................................................... 209
The Effects of New Development on Municipal Finance ...................... 209
Fiscal Impacts Over Time ............................................................................. 210
Uses of Fiscal Impact Analyses .................................................................... 212
Consultants and Third Party Analysts ......................................................... 213
Typical Techniques ......................................................................................... 213
Criticisms ......................................................................................................... 217
Fiscalization of Land-Use Planning ............................................................. 218
Summing Up .................................................................................................... 218
PART V
LOOKING BACK, GOING FORWARD:
THE ROAD TO REFORM
Chapter 16. Looking Back: A Brief History of California

Local Government Finance ........................................................... 223
The Early Constitution and Local Home Rule .......................................... 223
Proposition 13 and the Era of Limits ......................................................... 226
The Gann Limit .............................................................................................. 230
The 1980s: State Fiscal Retrenchment and Local Responses .................. 231
ERAF: Educational Revenue Augmentation Funds ................................. 232
Proposition 218 (1996): “The Right to Vote on Taxes Act” ................... 233
Proposition 26 (2010): Refining the Definition of “Tax” ...................... 233
Proposition 1A (2004) and Proposition 22 (2010) .................................... 235
Summing Up ................................................................................................... 236
Chapter 17. Going Forward: Outlook and Reform .................................... 239

Towards Reform ............................................................................................. 239
Reform Efforts ............................................................................................... 240
Challenges to Reform .................................................................................... 241
Common Flaws in Reform Efforts ............................................................. 244
Defining the Problem .................................................................................... 246
Principles of Local Government Fiscal Reform ....................................... 249
Summing Up .................................................................................................... 252
x
contents
Appendix A. An Overview of Public Finance Theory ............................... 255
Appendix B. Detailed City Budget Process ............................................... 261
Appendix C. Presenting Financial Information ........................................ 279
Appendix D. Useful Information Sources ................................................. 297
Bibliography ............................................................................................... 307
Glossary ...................................................................................................... 309
Index ........................................................................................................... 325
xi
Preface to the
Second Edition
T
he reasons for writing a second edition of this book remain essentially the
same as those when we undertook the first edition in 2012. In California, a
complex array of local governments—cities, counties, and special districts—
provides a wide range of important public services to its citizens. How those local
governments pay for those services involves a municipal finance system that is
complicated, with a byzantine structure governed by arcane rules. Yet, recognizing
how that system works is critical to making effective and responsive public policy.
Thus, the primary purpose of this book is to provide a solid foundation for those
who are interested in better understanding and navigating the complexity of Cal-
ifornia local public finance. This, we hope, will not only result in better decisions
within the current system but will also help in efforts to reform and improve it.
To do so, this book provides a broad overview of local government fi-
nance in California: the structure of government service delivery; the respon-
sibilities of different types of local governments; the sources of revenues and
their limitations; the fundamentals of public budgeting and accounting; and
the ways money can be borrowed to build infrastructure. Such an overview re-
quires some grounding in the convoluted history of the relationship between
the state and local governments. It must also touch on topics that are funda-
mental to both an understanding of the problems and the possibility of reform,
such as labor relations and the fiscal implications of development.
The problem with covering so dynamic a subject is that it is constantly
changing: economic conditions evolve, new laws are enacted, different issues
become especially topical to the public and the academy. That said, the main
picture of local government finance in California as presented in the first edi-
tion remains largely recognizable. But changes in the scene accumulated to the
point where a new edition seemed warranted.
Foremost, much of the statistical information contained in the numerous
charts and graphs has been updated. While the “big picture” hasn’t changed much,
the data are more current. Also, some court decisions have occurred related to
rate structures and pensions; some of the fiscal reforms that were emerging in
2012 have been advanced (or dropped); and other incremental changes to the
system have taken place. These modifications are noted in this current version.
xiii
When the first edition was submitted for publication, the Great Recession
and its immediate aftermath dominated the financial discussion, and the compe-
tition for scarce resources between the state and its local governments was acute.
Since then, the economy has recovered; state finances have, for the time being, at
least, been restored; and some semblance of stability has resulted. At the time, the
viability of some local governments was in doubt (and, indeed, drastic cuts in serv-
ices and even a few bankruptcies occurred). While most local agencies have now
weathered the worst times, there has been substantial interest in the early diagnosis
of possible fiscal difficulties. This edition includes a discussion of that issue.
In 2012, redevelopment, a long-used financing tool, had just been elim-
inated by the state with the resulting transfer of billions of dollars away from
local to state coffers. The way that the redevelopment agencies would “wind
down” was unclear. Again, since then, much of that restructuring has occurred;
a more recent focus has been on how some of the benefits of redevelopment
that were lost might be recaptured. A discussion of some of these ideas, in-
cluding Enhanced Infrastructure Financing Districts, has been added.
The glossary has been significantly expanded to help clarify some of
the technical terms used in the book. Graphics have been improved. In sum,
we hope that this new book not only brings the financial picture up to date,
but also makes the book even easier to use.
The original idea for the book rose from an undergraduate class in city
and regional planning taught at the California Polytechnic State University in
San Luis Obispo. As part of the required curriculum, students studied the fi-
nancial impacts that their hypothetical plans and developments would have on
the communities in which they would occur. No single textbook seemed to
cover these topics comprehensively, especially as they related to the unique cir-
cumstances in California. And it was equally apparent that there was a need for
such a book to assist not only budding planners, but also other students with
an interest in local government as well as newly appointed and elected public
officials, local government staff, and citizens at large.
In outlining the scope of the topics, it became clear that the effort
would benefit from the perspectives, experiences, and expertise of multiple au-
thors, including especially practitioners in the field who appreciate not only just
the technical issues, but also the cultural, historic and political elements.
We thank the many readers, including local government officials and
the professors and students at a growing number of universities and colleges,
for finding the book valuable. We hope that the second edition continues to
help people understand that complex but fascinating subject of local govern-
ment finance in California.
Michael Multari, Kenneth Hampian, and Bill Statler

San Luis Obispo, 2017
Michael Coleman
Davis, 2017
xiv
Acknowledgements
E
ven though each author has extensive practical experience in local gov-
ernment finance, writing this book proved even more challenging than
we anticipated. Local government finance in California is stunningly com-
plicated, layered and at times baffling—even for those of us who have worked
within the system for years. Fortunately, we have had a lot of help along the
way in getting the facts right, expressing complex issues as clearly as possible,
and keeping pace with the vagaries of a rather wild system.
Foremost, we thank our publisher Solano Press and Ling-Yen Jones,
with special appreciation for Natalie Macris for her encouragement, without
which the project would never have been launched. We also thank Corinne
Dwyer of North Star Press for her work on format and production, Maggie
Cox, who gave us sound advice on graphics, and Michael Coleman, who de-
signed all the charts, graphs, and many of the tables.
We were also assisted by several experts who most generously and gra-
ciously devoted their time reading drafts and providing key insights: Monica
Irons, whose knowledge of labor relations was especially valued; Claire Clark,
for her review of the economic development chapter that resulted in an im-
portant course correction; Dennis Moresco, who brought the perspective of
his successful career to the discussions of real estate development feasibility;
Kay Chandler and Ned Connelly, who reviewed the chapter on investments;
and Karl Mohr, whose insights on development and fiscal analysis were greatly
appreciated.
In addition, several people read the entire manuscript, for which we
give undying thanks: Gere Sibbach, who provided an important county per-
spective to our city-centric tilt; Roger Picquet, whose years as a city attorney
and superior court judge provided us with both a legal eye and the perspective
of a careful general reader; and Bob Leland, who lent his many years of wis-
dom and practical experience as a highly respected city finance officer.
xv
Of course, any errors in the book are our own responsibility.

We’d also like to thank Chris Clark, who offered advice and direction
early on and encouragement throughout, and Dr. John Nalbandian, who gen-
erously allowed us to share his wisdom regarding the role of political values,
gained through years of academic study and practical experience in local
elected office.
Lastly, we thank our spouses—Denise Fourie, Suzan Dargahi Hampian,
Mary Ann Statler, and Ruth Coleman—for indulging us the time we spent at
research and writing, for patience with us when staring at computer screens
made us oblivious to any other sensory events, and for their essential support.
— MM, KH, WCS, MC
xvi
Introduction and Overview
Part I
Introduction
Chapter 1
A
The Heart of the Matter
society’s capacity to deliver effectively basic day-to-day services to its

members fundamentally affects whether those people can live in a
healthy, safe and fulfilling way or must struggle near the ragged edge of
survival. In the United States, local governments (also called “municipalities”)
are typically at the forefront in providing these basic services—for example,
enforcing the law, putting out fires, delivering clean water, safely disposing of
unhealthy sewage, and maintaining local roads for the orderly movement of
people and things. Therefore, how local governments are funded, and how well
they are funded in order to carry out their mission, matters—a lot.
The great majority of people in California
live within incorporated cities: eighty-three Figure 1-1.
percent of the state’s almost forty-million Where Californians Live
residents in 2016.1 Cities, therefore, provide most
Californians with some or all of their local public
services. As of 2016, California’s 482 incorpor-
ated municipalities ranged in population from
over four million (Los Angeles) to fewer than 100
(Vernon).2 If one sets aside the four largest cities
(Los Angeles, San Diego, San Jose, and San
Francisco) and the dozen or so very small ones
with fewer than 1,000 people, the average size of
a California city is just over 50,000 people. Thus,
most of the city governments that provide local
public services serve modestly sized communities,
and, despite some unfortunate exceptions, are
typically highly accountable and responsive to Source: california department of Finance, 2016.
their citizens.
1
California’s municipalities also include counties,
What Are the Financial Duties of Local Governments? which provide many state-mandated services to all
county residents as well as services similar to those
While they are organized in a variety of ways, every municipality must of cities for those people who live in their
handle certain financial functions, including:
unincorporated areas. In addition, thousands of
• Revenue Collection and Accounting. the collection of taxes, fees other local governments, collectively called “special
and other revenues owed to the local agency, and accounting for those districts,” deliver a wide array of public services
monies. throughout the state. The boundaries of special
• Resource Allocation and Accounting. the expenditure of revenues
for appropriate purposes that reflect the priorities of the community,
districts are idiosyncratic, often owing more to
and accounting for those expenses. historical events and circumstances than to any
• Payments—Controller. the payment of bills owed by the agency to contemporary analysis as to the appropriateness or
others, including payroll, vendor payments and disbursements to other efficiency of this form of local government.
government agencies.
• Purchasing. the fair and competitive procurement of goods and
The large number and variety of local
services within the authorizations set by law and by the agency’s governments in California make the study of their
budget and policies. financial affairs complex, sometimes frustrating,
• Budgeting and Financial Planning. the forecasting of revenues and but also immensely interesting.3 Regardless of
expenses, establishing goals and priorities, allocating resources, and
making adjustments, as needed, in response to actual revenues and
form, to meet their public service duties, these
expenses. agencies must raise, manage and allocate many
• Auditing and Financial Reporting. the review and tracking of millions of dollars4 each year, employ staffs,
financial activities to ensure fairness, consistency, and conformity with negotiate and manage contracts, and build and
proper procedures, as well as transparency for the public and regu-
lators.
operate public facilities, among many other
• Employer. the employment of competent staff, including negotiating obligations, and do all this within a setting that
and providing wages, salaries and benefits, as well as maintaining must be continually open and accessible to the
appropriate working conditions. public. This is a remarkable and most challenging
• Cash Management and Investments. the proper maintenance of
cash holdings and investments in light of day-to-day cash flow needs
undertaking, especially given the daunting financial
while assuring security of assets, providing liquidity, and generating a limitations most agencies operate within today.
responsible level of yield, in that order. Money for delivering local government services
• Capital Financing and Debt Management. the use of debt financing in California is raised largely through an intricate
tools to manage temporary short-term cash flow issues as allowed by
law, as well as for paying for expensive and long-lived capital improve-
system of taxes and fees—a finance system that is
ments. complicated and unique. That unique nature of the
system is due to many factors of law, history, and
culture, including state constitution provisions
enacted by voter initiative that prescribe strict limits on how municipalities can
raise revenues—and even how they can spend their money. In addition, recurring
financial crises in the state government have had dramatic repercussions at the
local level, further stressing municipal revenues and services.
How local governments decide to use their limited resources leads to a
complicated intersection of public policy, community planning, and budgeting. In
a democratic society, this intersection must be navigated with transparency and
ongoing accountability to the community. The allocation of resources almost
always involves more than only technical financial “efficiency” considerations.
Major budget decisions often depend as much on the values held by the decision-
makers than any financial analysis.
2
chapter i: introduction
It is not uncommon for the proposal of a major development project
to bring many concerned people to a public meeting, while city council or board
of supervisor hearings on the adoption of a budget may generate little interest.
This is perhaps a testament to the skills of municipal finance officials, but it
may also reflect the perception that financial planning and budgets are mostly
boring and routine. But running a city or county is much more than approving
or denying the controversial shopping center or condominium development.
The heart of the matter, in fact, is the ongoing work to balance limited revenues
with the public demand for costly and often vital services and facilities.
Purpose of the Book
As diverse and complex as California is, there is one thing most Californians
can agree on: major state-local financial reform is needed. However, it is also
safe to say that most people do not have a good understanding of the system’s
byzantine structure. Improvements to how Californians pay for needed and
desired local public services and facilities can be realistically accomplished only
with a sound understanding of the system, with all its wonderful, frustrating
and sometimes illogical complexity. Unfortunately, however, even those who
have toiled within the system for years can struggle to understand it.
This book provides a guide to the many financial aspects of local
government in California. The goal is to offer added understanding and new
insight for both the general public and practitioners, whether novices or
veterans of the financial system. The book is also intended to aid local
government managers and staff, including community planners and policy
analysts. And, it is hoped, the book will find an audience with elected officials
because they will be critical in leading the way toward an improved public
finance system. The book will also be helpful to teachers and students in our
state’s colleges and universities, from where so many future agency staff, elected
leaders, as well as voters, will come.
Here are some ways that these different readers can benefit from this
book:
Public agency managers and staff. The book offers city and county
managers a single resource covering the wide range of local public finance
topics tailored to the conditions found in California. Managers can also use
this book to build deeper financial understanding and skills within the larger
agency staff. For example, the book explains key laws that limit the ways
public money can be raised and spent; it also outlines how competing
priorities are reconciled through financial planning and budgeting. There is
a natural tendency for agency staff to focus on their own departmental
circumstances; this book will help broaden their understanding of “the big
3
picture” and help to soften the boundaries between agency functions, leading
to a stronger integration of services.
Planners and public policy analysts. Any serious planning practitioner or
municipal policy analyst needs to understand how local government is
financed. This book provides the necessary economic context for policy
review and development. This subject is especially important for city planners
who implement, revise and update community general plans. Plans that are
not rooted in economic and financial reality are rarely implemented and,
thus, often little more than exercises. Curiously, state law does not require
an economic or financial element in a general plan. But a plan that does not
consider the fiscal impacts of the proposed land uses may result in a
financially unsustainable community. Furthermore, economically infeasible
plans can undermine community development and revitalization, occupying
shelves and websites while land remains vacant or underutilized and
pressures build to develop it in ways contrary to the overall community
vision. This book helps planners understand the basic economic and financial
considerations that are part of sound planning practices, at both the project,
and, more importantly, the general plan levels.
Elected and appointed officials. Many elected officials are surprised by the
depth and scope of responsibilities they must undertake upon taking office.
They are suddenly in charge of organizations with multi-million dollar budgets
with unpredictable funding sources and demands for expanded and improved
services, all occurring in a highly complicated legal context that is under
continual public scrutiny. City council members, especially, will find this book
to be a valuable overview of municipal finance, covering not only such basic
topics as revenue sources in California, but also labor relations and negotiating,
debt financing, budgeting and financial reporting, investment of public monies,
assessing fiscal impacts of new development, and a better understanding of
what drives local economies. Although the emphasis is on cities, many of the
elements of theory and practice presented in the book are highly applicable to
California’s other local governments, namely, its counties and special districts.
Thus, the elected counterparts in counties and special districts will find the
book useful. Throughout the text, key differences between cities, counties, and
special districts are highlighted.
The book will similarly benefit most appointed officials—including
planning commissioners, parks commissioners, and others—to better
appreciate the relationships between their specific duties and the broader
purposes and financial capacities of the organization.
Citizens. The book will be interesting to anyone who wonders how local
communities have developed and paid for their systems of public facilities
and services, and how those systems are maintained, changed and expanded.
4
It will also be helpful to persons perplexed about why their local government
seems to be frequently stressed by financial problems, often linked to the
ups-and-downs of the general economy and to the state budget. Anyone
who has asked what income sources actually underlie municipal budgets or
why certain services suffer cuts while others are expanded, or who have
heard their local officials decry the intrusions of state government dimin-
ishing their ability to maintain services such as police patrols or road repairs,
will find this book valuable. The book also assists citizens interested in
reform by offering criteria for judging proposals put forth by those in elected
office or those seeking office.
Students. This book should be of practical help to students, particularly at
the college and university levels, studying local government, planning and
public policy. As great as California may be, its current financial system is
not sustainable into the future, statewide or at the local level. Changes are
needed, but these changes will only come about through leaders, agency staff,
and citizens who are grounded in a practical understanding of the system,
including how it has evolved and what is needed in the future.
This book has been written primarily to provide a practical understanding of

the current system, its past, and the bumpy road to reform. However, for
readers looking for some basic background on the theoretical underpinnings
of public finance, Appendix A provides a very brief overview of the most
common philosophical questions dealt with in this field.
Roadmap to the Major Topics
The book is organized into five parts: I, this introduction and an overview of what
California local governments do; II, a review of a fundamental aspect of local
government finance: the concept and management of “funds;” III, the key topics
in the practice of municipal finance, including budgeting, labor, purchasing, capital
improvements, investing and reporting; IV, topics related to development and local
government finance including the municipality’s roles in real estate development,
fiscal impact assessments of plans and projects, and community economic
development; and, V, a look back at the history that has led to today’s severely
stressed financial system and a look ahead toward the future with suggested
principles for reforming that system.
Part I: Introduction and Overview
Anyone who wants a thorough grounding in municipal finance—what it

consists of, how it works, and the political and economic forces that influence
5
it—will find the entire book useful. The book is also a written as a guide for
those needing to learn about specific topics of greater interest or urgency. The
remainder of Chapter 1 provides short summaries of the topics covered in
each chapter.
Chapter 2 sets the stage by providing an overview of what California local

governments do. There are almost 6,000 local governments in California (not
counting school districts) that have different legal bases, wide-ranging
responsibilities for providing public services, and varied and sometimes
competing funding sources. This chapter summarizes the principal differences
among cities, counties, and special districts, and gives a statewide perspective
on the types of local services these municipalities provide in California, how
much money is expended in their delivery, and the main ways of paying for
them.
Part II: Funds
Chapter 3 introduces the concept of funds—how money from different

sources and intended for various uses must legally be accounted for by public
agencies. This chapter explains the concept of funds and the basic language of
municipal finance needed to understand the more detailed topical discussions
that comprise the remainder of the book.
Chapter 4 examines the “general fund,” the flexible fund that holds a local
agency’s “unrestricted” revenues to pay for such important services as police,
fire, parks, and roads. The kinds of local taxes that contribute to the general
fund in California cities and counties are described, as well as other sources of
general purpose income. These revenues are nothing less than essential to cities
and counties, and yet they are subject to numerous limits that diminish the local
community’s control over them. When local governments talk about their fiscal
woes, they are almost always talking about the general fund.
Chapter 5 looks at “special funds,” restricted funds whose revenues must be

earmarked for specific purposes only. These inflexible funds include special
taxes, subventions, and grants. They comprise significant revenues to cities, but
are especially important to counties, which are charged with providing such
critical and expensive services as welfare and public health that are both
mandated and largely funded by the state.
Chapter 6 focuses on the “enterprise funds,” the business-like funds

supporting services that agencies deliver much like the private sector by
charging fees directly to customers for services such as water, sewage disposal
6
and garbage pick-up. Based on their revenues and expenditures, statewide, these
enterprises account for about a third of what local governments do in
California. In many ways, enterprise functions are afforded greater flexibility
when it comes to raising needed money, and, with some important exceptions,
typically aim to be financially self-supporting. This chapter specifically includes
some practical suggestions related to rate setting processes and principles.
Part III: The Practice
Chapter 7 introduces the “kingpin” of local government financial practice,

budgets and fiscal policies. Budgets are king because it is through the
allocation of resources that an agency declares its priorities (overtly or not).
And yet budget processes are often misunderstood, poorly executed or even
ignored. This chapter describes the purposes, types, and requirements of
municipal budgets. It also discusses the importance of basing budgets on open,
accessible processes that articulate community goals and priorities. The chapter
includes examples of the types of financial questions faced by elected officials
when adopting budgets whose answers are not necessarily technical in nature.
Appendix B provides practical suggestions for developing and adopting an
effective budget.
Chapter 8 discusses the foremost budget driver—labor, the cost of employing

people. It is indeed through people that most local public services are delivered—
thus, issues related to staffing costs are fundamental to municipal finance. The
chapter identifies the typical components of compensation, including benefits
and other obligations, that account for the real cost of labor. It discusses why
these costs typically increase faster than the general inflation rate. Labor negoti-
ations and collective bargaining often overwhelmingly shape budgets in many
local jurisdictions. The chapter covers negotiation processes, the key players, and
different routes to reaching agreement.
Chapter 9 is about purchasing—buying things and contracting for

services. While supplies, minor equipment and service contracts typically
comprise a smaller percentage of a budget than labor, government procurement
garners considerable attention—for good reason. Historically, it is an area where
corrupt officials have manipulated the processes for personal gain, with ensuing
scandals that launched major local government reform movements in America.
Past reforms have included emphasizing formal and centralized procurement
systems. Such systems, however, sometimes lead to unnecessary bureaucracy
and inefficiencies. This chapter describes emerging best practices that aim to
assure the integrity of the procurement process while fostering improved
efficiency.
7
Chapter 10 addresses the final major part of most local government budgets,
capital improvements and debt financing; that is, planning and paying for
long-lived facilities and infrastructure like police and fire stations, roads,
wastewater treatment plants, parks, libraries, and city halls. Public agencies often
borrow money through the issuance of bonds to construct capital improve-
ments and pay off the debt service over the lifetime of the facility. This chapter
explains municipal bond basics and the types of debt financing instruments
available to California local governments.
Chapter 11 addresses another vital practice, investment, managing the

public’s portfolio. This is also an area that has been rocked by calamities and
scandals due to unwise practices. The chapter answers key questions such as:
What should agencies do with the public’s portfolio until saved money is needed?
How can officials assure that the investments are being managed properly? The
chapter suggests best practices, including that agencies follow the “SLY”
maxim: safety, liquidity, and yield (and in that order).
Chapter 12 covers reporting and accountability—the ways that an agency

presents its financial condition to regulators and the public. While auditing and
financial reporting may sound dull, these functions are at the center of govern-
mental integrity by opening the organization’s books to answer such important
questions as: Is proper stewardship of the public’s resources being exercised? Is
the governing body performing in a transparent and open way? Can citizens rely
on their government’s financial statements? This chapter describes the types of
required reports and their essential contents and purposes. In addition, given the
severe financial distress faced by many municipalities over the last decade, the
chapter discusses how properly to diagnose California local government financial
health. Appendix C expands on this topic, detailing best practices for
presenting financial data in a thorough, yet understandable, way for decision
makers and the public.
Part IV: Development and Real Estate Finance
Chapter 13 examines a field of municipal finance that currently earns a lot of

interest, local economic development—fostering business vitality. Despite
the enthusiasm for economic development, especially in recessionary times,
many local governments have learned that success in this area is difficult
without careful planning and analysis. The chapter starts by exploring what
constitutes a “local economy” and then discusses goal-setting and strategic
planning, business attraction and retention, before briefly describing several
contemporary economic development techniques.
8
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Chiefly through the researches of Hilgard attention has been called to
the true character of these soils which are found throughout a large part
of the Western United States and which are known by the common
name of alkali. The following description of the origin of these soils is
compiled chiefly from Hilgard’s papers on this subject. Wherever the
rain-fall is scanty, and especially where the rains do not come at any one
time with sufficient force to thoroughly saturate the soil and carry down
through the subsoil and off through the drainage waters the alkali
contained therein, favorable conditions exist for the production of the
alkaline soil mentioned above. The peculiar characteristic of this soil is
the efflorescence which occurs upon its surface and which is due to the
raising of soluble salts in the soil by the water rising through capillary
attraction and evaporating from the surface, leaving the salts as an
efflorescence.
Soils which contain a large amount of alkali are usually very rich in
mineral plant food, and if the excess of soluble salt could be removed,
these lands under favorable conditions of moisture would produce large
crops.
The formation of the alkali may be briefly described as follows: By the
decomposition of the native rocks, certain salts soluble in water are
formed. These salts in the present matter are chiefly sodium and
potassium sulfates, chlorids and carbonates. The salts of potash
together with those of lime are more tenaciously held by the soil than
the soluble salts of soda, and the result of this natural affinity of the soil
for soluble potash, lime and magnesian salts is seen in the formation at
the surface of the earth, by the process of evaporation above described,
of a crust of alkaline material which is chiefly composed of the soluble
salts of soda. In countries which have a sufficient amount of rain-fall,
these soluble salts are carried away either by the surface drainage or by
the percolation of water through the soil, and the sodium chlorid is
accumulated in this way in the waters of the ocean. But where a
sufficient amount of rain-fall does not occur, these soluble salts carried
down by each shower only to a certain depth rise again on the
evaporation of the water, reinforced by any additional soluble material
which may be found in the soil itself. The three most important
ingredients of the alkali of the lands referred to are sodium chlorid,
sulfate, and carbonate. When the latter salt, namely, sodium carbonate,
is present in predominant quantity, it gives rise to what is popularly
known as black alkali. This black color is due to the dark colored
solution which sodium carbonate makes with the organic matters or
humus of the soil. The black alkali is far more injurious to growing
vegetation than the white alkali composed chiefly of sodium sulfate and
chlorid.
This black alkali has been very successfully treated by Hilgard[33] by
the application of gypsum which reacting with the sodium carbonate
produces calcium carbonate and sodium sulfate, thus converting the
black into the white alkali and adding an ingredient in the shape of lime
carbonate to stiff soils which tends to make them more pulverulent and
easy of tillage.
This method of treatment, however, as can be easily seen, is only
palliative, the whole amount of the alkaline substances being still left in
the soil, only in a less injurious form.
The only perfect remedy for alkaline soils, as has been pointed out by
Hilgard, is in the introduction of underdrainage in connection with
irrigation. The partial irrigation of alkaline soils, affording enough
moisture to carry the alkali down to and perhaps partially through the
subsoil, can produce only a temporary alleviation of the difficulties
produced by the alkali. Subsequent evaporation may thus increase the
amount of surface incrustation. For this reason in many cases the
practice of irrigation without underdrainage may completely ruin an
otherwise fertile soil by slowly increasing the amount of alkali in the soil
by the total amount of the alkaline material added in the waters of
irrigation.
As Hilgard has pointed out, if a soil can be practically freed from
alkali by underdrainage connected with a thorough saturation by
irrigation, it may be centuries before the alkali will accumulate in that
soil again when ordinary irrigation only is practiced. It may thus
become possible to reclaim large extents of alkaline soil little by little by
treating them with an excess of irrigation water in connection with
thorough underdrainage. The composition of the alkali on the surface of
the soil due to the causes above set forth is thoroughly illustrated by the
analyses of Hilgard and Weber, which follow:
Table Showing Composition of Alkali Salts in San Joaquin Valley.
FRESNO COUNTY.
Sections 13 and 24 T. 14 S. R. 19 E., 4 miles S. W. Miss Austin’s N.W. Cor. N ½ Easton. Emigr’nt
from Fresno. Ranch, Central Sec. 20 T. 14 S. R. Ditch.
Colony. 21 E.
Alkali Alkali Spot, 1889. Surface Surface Surface Surface
soil, 1 inch 18 26 42 soil, soil, No. soil. soil.
1888. surface. inches inches inches No. 1. 2.
bel. bel. hardpan.
surface. surface.
Soluble salts 0.76 0.20 0.18 0.16 3.54 1.90 1.20 2.69
in 100
parts soil
Potassium small moderate
sulfate
[D]Potassium small
nitrate
Potassium
carbonate
(Saleratus)
Sodium large small small very very slight large large much moderate large
sulfate slight
(Glauber’s
salt)
Sodium very large small large large small chiefly small small chiefly
carbonate slight
(Sal-soda)
Sodium chiefly moderate chiefly moderate moderate chiefly large chiefly chiefly large little
chlorid
(Common
salt)
[D]Sodium
phosphate
Calcium moderate small very very very slight small moderate small small much
sulfate slight slight
(Gypsum)
Magnesium small much
sulfate
(Epsom
salt)
Organic
matter
D. Very generally present, but not always in quantities sufficient for determination.
TULARE COUNTY.
Goshen Peopl’s Ditch Near Lake Tulare Visalia Lemoore Tulare Exp’t Station
Surf’ce soil Alkali crust Surf’ce soil Surf’ce soil Alkali crust Alkali crust
Soluble salts in 100 parts soil 1.40 0.83 1.26
Potassium sulfate small
[E]Potassium nitrate small
Potassium carbonate (Saleratus) 18.80
Sodium sulfate (Glauber’s salt) 44.24 1.22 31.30[F] 13.4 chiefly 32.8
Sodium carbonate (Sal-soda) 32.98 88.09 18.2 45.3 36.16
Sodium chlorid (Common salt) 16.74 1.00 4.4 little 31.16
[E]Sodium phosphate 1.97 0.22 10.4
Calcium sulfate (Gypsum) little
Magnesium sulfate (Epsom salt) 8.1 moderate
Organic matter 1.59 9.21 7.5 5.37
KERN COUNTY.
Alkali crusts from the Smyrna artesian belt. Townships 25 and 26 R. 23 E. W. S. Summer. Kern
W. from Delano, S. P. R. R. Island
No. 1 No. 2 No. 3 No. 4 No. 5 No. 6 No. 7 No. 8 Alkali Alkali
crust crust
Soluble salts in 100
parts soil
Potassium sulfate 4.72
[E]Potassium nitrate
Potassium carbonate
(Saleratus)
Sodium sulfate small moderate moderate moderate large small small small 19.20 70.61
(Glauber’s salt)
Sodium carbonate (Sal- 14.82
soda)
Sodium chlorid large moderate large large small large small large 37.14 4.13
(Common salt)
[E]Sodium phosphate
Calcium sulfate small small small small small small small small 0.96 0.08
(Gypsum)
Magnesium sulfate small small small small small small small small 18.31
(Epsom salt)
Organic matter 20.87
F. Common and Glauber’s salts.
50. Adobe Soils.—In many parts of the arid regions of this country which can be
recovered for agricultural purposes by irrigation the soil has peculiar characteristics.
The name adobe as commonly used applies to both the sundried bricks of the arid regions
of the West and Southwest, and to the materials of which they are composed. The material is
described by Russell[34] as a fine grained porous earth, varying in color through many shades
of gray and yellow, which crumbles between the fingers, but separates most readily in a
vertical direction. The coherency of the material is so great that vertical scarps will stand for
many years without forming a noticeable talus slope.
Distribution.—The area over which adobe forms a large part of the surface has not been
accurately mapped, but enough is known to indicate that it is essentially co-extensive with
the more arid portions of this country. In a very general way it may be considered as being
limited to the region in which the mean annual rain-fall is less than twenty inches. It forms
the surface over large portions of Colorado, New Mexico, Western Texas, Arizona, Southern
California, Nevada, Utah, Southern Oregon, Southern Idaho, and Wyoming. Adobe occurs
also in Mexico and may there reach a greater development than in the United States, but
observations concerning it south of the Rio Grande are wanting.
In the United States it occurs from near the sea-level in Arizona, and even below the sea-
level in Southern California, up to an elevation of at least six or eight thousand feet, along
the eastern border of the Rocky Mountains, and in the elevated valleys of New Mexico,
Colorado, and Wyoming. It occupies depressions of all sizes up to valleys having an area of
hundreds of square miles. Although occurring throughout the arid region, it can be studied
to best advantage in the drainless and lakeless basins in Nevada, Utah, and Arizona.
Composition.—When examined under the microscope, the adobe is seen to be composed
of irregular, unassorted flakes and grains, principally quartz, but fragments of other
minerals are also present. An exhaustive microscopic study has not been made, but the
samples examined from widely-separated localities were very similar. The principal
characteristics observed were the extreme angularity of the particles composing the deposit
and the undecomposed condition of the various minerals entering into its composition. It is
to be inferred from this that the material was not exposed even to a very moderate degree of
friction, and had not undergone subaerial decay before being deposited. Adobe collected, at
typical localities is so fine in texture that no grit can be felt when it is rubbed between the
fingers; in other instances it contains angular rock fragments of appreciable size.
The composition of the material is illustrated by the following analyses:
Analyses of Adobe.
By L. G. Eakins.
Constituents. No. 1. No. 2. No. 3. No. 4.

Sante Fe, New Fort Wingate, New Humboldt, Salt Lake City,
Mexico. Mexico. Nevada. Utah.
SiO₂ 66.69 26.67 44.64 19.24
Al₂O₃ 14.16 0.91 13.19 3.26
Fe₂O₃ 4.38 0.64 5.12 1.09
MnO 0.09 trace 0.13 trace
CaO 2.49 36.40 13.91 38.94
MgO 1.28 0.51 2.96 2.75
K₂O 1.21 trace 1.71 trace
Na₂O 0.67 trace 0.59 trace
CO₂ 0.77 25.84 8.55 29.57
P₂O₅ 0.29 0.75 0.94 0.23
SO₃ 0.41 0.82 0.64 0.53
Cl 0.34 0.07 0.14 0.11
H₂O 4.94 2.26 3.84 1.67
Organic matter 2.00 5.10 3.43 2.96
99.72 99.97 99.84 100.35
51. Vegetable Soils.—The heavy soils whose origin has been described are essentially of
a mineral nature. The quantity of organic matter in such soils may vary from a mere trace to
a few per cent, but they never lose their mineral predominance. When a soil on the other
hand is composed almost exclusively of vegetable mold it belongs to quite another type. Such
soils are called tule, peat or muck. In this country there are thousands of acres of peat or
muck soils; the largest contiguous deposits being found in Southern Florida. The origin of
these soils is easily understood. Whenever rank vegetation grows in such a location as to
secure for the organic matter formed a slow decay there is a tendency to the accumulation of
vegetable mold in shallow water or on marshy ground and where conditions are favorable to
such accumulations. In Florida the muck soils have been accumulated about the margins of
lakes. During the rainy season the marshes bordering these are partly covered with water,
but the vegetation is very luxuriant. The water protects the vegetable matter from being
destroyed by fire. It therefore accumulates from year to year and is gradually compacted into
quite a uniform mass of vegetable mold.
The composition of the muck is illustrated in the following table which shows the
character of the layers at one, two and three feet in depth:[35]
Carbon. Hydrogen. Nitrogen. Volatile matter.

1 foot 57.67 per cent 4.48 per cent 2.24 per cent 90.60 per cent
2 feet 47.07 „ 5.15 „ 1.40 „ 72.00 „
3 feet 8.52 „ 0.53 „ 0.31 „ 15.00 „
In this sample, No. 3, the muck was only three feet deep, resting on pure sand. As the
bottom of the deposit is approached the admixture of sand becomes greater and the
percentage of organic matter less.
No reliable estimate of the time which has been required to form these deposits can be
given, but in the Okeechobee region in Florida the deposit of vegetable mold in some places
exceeds ten feet in depth.
The purest muck or peat soils contain only small quantities of potash and phosphoric acid,
and especially is this true of the Florida mucks which have been formed of vegetable growth
containing very little mineral matter.
It is not at all probable that the flora now growing on any particular area of virgin peat
contains all the plants that have contributed to its formation. The principal vegetable
growths now going to make up the muck soils of Florida are the following:
Common names. Botanical names.

Saw grass Cladium effusum
Yellow pond lily Nymphea flava
Maiden cane grass Panicum Curtisii
Alligator Wampee Pontederia cordata
Sedge Cyperus species
Fern brake Osmunda „
Mallow Malva „
Broom sedge Andropogon „
Arrow weed Sagittaria „
The above are only the plants growing in the greatest profusion and do not include all
which are now contributing to increase the store of vegetable débris.
52. Humus.—The active principle of vegetable mold is called humus, a term used to
designate in general the products of the decomposition of vegetable matter as they are found
in soils. In peat and muck are found a mixture of humus with undecomposed or partially
decomposed vegetation.
According to Kostytchoff[36] vegetable matter decays under the influence of molds and
bacteria. Molds alone produce the dark colored matters which give soils rich in vegetable
matter, their color. One chief characteristic of humus is its richness in nitrogen. Black
Russian soil contains from 4 to 6.65 per cent of nitrogen. This soil is estimated to contain
sixty million organisms per gram and much of the nitrogen which it holds must be in the
form of proteids. The first development in decaying vegetable matter is of bacteria and there
is a tendency of the decaying matter to become acid. This causes a decay of the bacteria and
the ammonia produced by this neutralizes the acid. The various kinds of mold grow when
the reaction becomes neutral. Afterwards the bacteria and the molds develop together. This
statement of Kostytchoff is not a very satisfactory explanation of even our limited knowledge
of the decomposition of organic matters in the soil. Ammonia and ammonia salts are formed
not by the decay of some forms of bacteria but by the activities of other forms. Warington
found that in nitrification there were three distinct forms of bacteria concerned in the final
products of ammonia, nitrites, and nitrates. Humus always contains easily decomposable
matter and consequently the rate of decay at any observed periods is nearly the same. In
humus which is produced above the water-level Kostytchoff states that all trace of the
vegetable structure is destroyed by the leaves being gnawed and passed through the bodies
of caterpillars and wire-worms. Under the water-level the vegetable structure is preserved
and peat results. The decay of humus is most rapid in drained and open soils. For this reason
the presence of clay in a soil promotes the accumulation of humus. Inferior organisms are
the means of diffusing organic matter through the soil. The mycelia of fungi grow on a dead
root for instance, ramify laterally and thus carry organic matter outward and succeeding
organisms extend this action and the soil becomes darkened in proportion. Humic acid in
black soil is almost exclusively in combination with lime.
A more common view of the difference between the formation of humus above and below
the water-level is that above the water-level there is a very free access of air and even the
harder parts of the leaf skeleton can be oxidized through the agency of bacteria, while under
the water-level there is a very limited supply of air and this oxidation cannot proceed as
rapidly. The harder parts of the leaf skeleton are preserved, and from the freer access of air
humus is oxidized more readily in drained and open soils, and accumulates in clay soils
where there is less circulation of air.
The real composition of humus is a matter which has never been definitely determined.
Composed of many different but closely related substances it has been difficult to isolate and
determine them.
Stockbridge[37] gives the following composition of the bodies which form the larger part of
humus:
Ulmin and Ulmic Acid.
Carbon 67.1 per cent Corresponding to C₄₀H₂₈O₁₂ + H₂O.
Hydrogen 4.2 „
Oxygen 8.7 „
Humin and Humic Acid.
Carbon 64.4 per cent Corresponding to C₂₁H₂₄_O₁₂ + 3H₂O

Hydrogen 4.3 „
Oxygen 31.3 „
Crenic Acid.
Carbon 44.0 per cent Corresponding to C₁₂H₁₂O₈?

Hydrogen 5.5 „
Nitrogen 3.9 „
Oxygen 46.6 „
Apocrenic Acid.
Carbon 34.4 per cent Corresponding to C₂₄H₂₄O₁₂?

Hydrogen 3.5 „
Nitrogen 3.0 „
Oxygen 39.1 „
He further states that there are, aside from these humus compounds, others still less
known and the action of which is not yet understood; among them xylic acid, C₂₄H₃₀O₁₇,
saccharic acid, C₁₄H₁₈O₁₁, glucinic acid, C₁₂H₂₂O₁₂, besides a brown humus acid
containing carbon, 65.8 per cent, and hydrogen, 6.25 per cent, and a black humus acid
yielding carbon, 71.5 per cent, and hydrogen, 5.8 per cent.
According to Mulder humic acid has the following composition, C₆₀H₅₄O₂₇, while
Thenard[38] ascribes to it the formula, C₂₄H₁₀O₁₀.
At the present time we can only regard the various forms of humus bodies as mixtures of
many substances mostly of an acid nature and resulting from a gradual decomposition of
organic matter under conditions which partially exclude free access of oxygen.
For analytical purposes it is only necessary to separate these bodies by the best approved
processes. A further knowledge of their composition can then be derived by determining the
percentages of carbon dioxid and water which they yield on combustion.
53. Soil and Subsoil.—Many subdivisions have been made of the above varieties of soil,
but they have little value for analytical purposes. For convenience in description for
agricultural purposes, the soil, however, is further divided into soil and subsoil. In this sense
the soil comprises that portion of the surface of the ground, usually from four to nine inches
deep, containing most of the organic remains of plants and animals and in which air
circulates more or less freely for the proper humification of the organic matter, which
usually gives a darker color to the soil than to the subsoil. The subsoil proper lies below this,
and has usually more characteristic properties, especially in respect of color and texture, as it
has been less influenced by artificial conditions of cultivation and the remains of vegetation.
The subsoil extends to an indefinite depth and is limited usually by deposits of
undecomposed or partly decomposed rock matter, or by layers of clay, sand or gravel.
Inasmuch, however, as the influence of the subsoil on growing crops is of little importance
below the depth of eighteen inches the analysis of samples from a greater depth has more of
a geologic than agricultural value.
Hilgard regards as subsoil whatever lies beneath the line of change, or below the minimum
depth of six inches. But should the change of color occur at a greater depth than twelve
inches, the soil specimen should nevertheless be taken to the depth of twelve inches only,
which is the limit of ordinary tillage; then another specimen from that depth down to the
line of change, and then the subsoil specimens beneath that line. The depth to which the last
should be taken will depend upon circumstances. It is always desirable to know what
constitutes the foundation of a soil to the depth of three feet at least, since the question of
drainage, resistance to drought, etc., will depend essentially upon the nature of the
substratum. But in ordinary cases ten or twelve inches of subsoil will be sufficient. The
sample should be taken in other respects precisely like that of the surface soil, while that of
the material underlying this subsoil may be taken with less exactness, perhaps at some ditch
or other easily accessible point, and should not be broken up like the other specimens.
In the method of soil sampling adopted by the Royal Agricultural College of England, the
soil is regarded as that portion of the surface of the ground which is reached by ordinary
tillage operations, generally being from six to nine inches deep; the subsoil is that portion
which is ordinarily not touched in plowing.
AUTHORITIES CITED IN PART FIRST.
1. Comptes rendus, Tome 110, p. 1271.
2. Wyatt, Phosphates of America, p. 66.
3. Engineering and Mining Journal, August 23, 1890.
4. American Journal of Science, Vol. 41, February, 1891.
5. Preliminary Sketch of Florida Phosphates, Author’s edition, pp. 18, et seq.
6. Journal für praktische Chemie, 1st series, Band 38, S. 388.
7. Annual Report Connecticut Experiment Station, 1890, p. 72.
8. Annual Report Massachusetts Experiment Station, 1887, p. 233.
9. Bulletin 21, Rhode Island Experiment Station, 1893.
10. Chemical Composition of Food-Fishes. Report of U. S. Commissioner of Fish and Fisheries, 1888, pp.
679 et seq.
11. G. Brown Goode, American Naturalist, Vol. 14, July, 1890.
12. Comptes rendus, Tome 101, 1885, pp. 65, et seq.
13. Royal Agricultural Society Journal, Vol. 13, 1852, pp. 349 et seq.
14. Gîtes Mineraux, par Fuchs et DeLauny, Tome 1, p. 425.
15. El Salitre de Chile; René F. LeFeuvre y Artūro Dagnino, 1893, p. 12.
16. Crampton, American Chemical Journal, Vol. II, 1890, p. 227.
17. Potash, pamphlet of German Kali Works, pp. 3, 4.
18. Gîtes Mineraux, p. 429.
19. Bulletin of the Philosophical Society of Washington, Vol. II, p. 142.
20. Handbook for the Department of Geology of the U. S. National Museum, by Geo. P. Merrill.
21. Vid. supra, p. 506.
22. Vid. supra, Plate 120.
23. Merrill, op. cit. p. 521.
27. Mineral Physiology and Physiography, p. 251.
28. Bulletin No. 52, United States Geological Survey, p. 16.
29. bis (p. 48), Vid. supra, p. 38.
30. The Formation of Vegetable Mold through the Action of Worms.
31. Rocks and Soils, pp. 131–2.
32. Comptes rendus, Tome 110, p. 1370.
33. Bulletin No. 83, California Experiment Station.
34. Geological Magazine, Vol. 7, No. 6, pp. 291–92.
35. Wiley, Agricultural Science, 1893, pp. 106 et seq.
36. Travaux de la Société des Naturalistes St. Petersburg, Tome 20, 1889.
37. Rocks and Soils, p. 134.
38. Beilstein’s Handbuch der Organischen Chemie, Band I, Ss. 891–2.
PART SECOND.
TAKING SAMPLES OF SOIL FOR ANALYSIS.
54. General Principles.—It would be unwise to attempt to give

any single method of taking soil samples as the only one to be
practiced in all circumstances. In the methods which follow it is
believed will be found directions for every probable case. The
particular method to be followed will in each case have to be
determined by circumstances.
The sole object in taking a sample of soil should be to have it
representative of the type of soils to which it belongs. Every
precaution should be observed to have each sample measure up to
that standard.
The physical and chemical analyses of soils are long and tedious
processes and are entirely too costly to be applied to samples which
represent nothing but themselves.
The particular place selected for taking the samples as well as the
method employed are also largely determined by the point of view of
the investigations. The collection of samples to illustrate the geologic
or mineralogical relations of soils is quite a different matter from
gathering portions to represent their agricultural possibilities. In a
given area the sum of plant food in the soil would only be determined
by the analyses of samples from that particular field, while samples
illustrating geologic relations could or should be taken at widely
distant points. Again the chemist is content with a sample of a few
grams in weight while the physicist would require a much larger
quantity. Much popular ignorance exists respecting the importance
of the collection of soil samples. As an illustration of this may be
cited a recent instance in which a sample of soil was received by the
author with a request for a complete analysis and a statement of the
kinds of crops it was suited to grow. No data relating to the locality in
which the sample was taken accompanied this request. The sample
itself, which weighed a little less than 3.6 grams, was not a soil at all
in an agricultural sense but a highly ferruginous sand.
The collector of samples who understands the purpose for which
he is working will find among the approved methods which follow
some one or some combination of methods, by means of which his
work can be made successful. In these cases it is the collector rather
than the method on which reliance must be placed to secure properly
representative samples.
55. General Directions for Sampling.—The locality having
been selected which presents as nearly as possible the mean
composition of the field a square hole is dug with a sharp spade to
the depth of eighteen inches. The walls of this hole should be smooth
and perpendicular. The soil to the depth of six to nine inches is then
removed from the sides of the hole in a slice about four inches thick;
or the sample of soil may be taken to the depth indicated by a change
of color. Any particles which fall into the bottom of the hole are
carefully collected and added to the parts adhering to the spade. The
whole is thrown into a suitable vessel for removal to the laboratory.
The sample of soil having been thus secured, the subsoil is taken in
the same way. To insure uniformity in the samples, it is well to take
several of them from the same field. Where more than one sample is
taken it is advisable to mix all the sub-samples in the field, remove
large sticks, stones, roots, etc., and take a general sample of from
three to five kilograms. The character of the débris, etc., removed
should be carefully noted.
It is sometimes desirable to take samples of the subsoil to a greater
depth than eighteen inches. A post-hole auger or large wood auger
will be found very useful for this purpose. It is rarely necessary to
take samples of subsoil to a greater depth than six feet. In taking
samples the geologic formation and the general topography of the
field should be noted, also the character of the previous crops, kind
and amount of fertilizers employed, character of drainage and any
other data of a nature to give a more accurate idea of the forces
which have determined the physical and chemical properties of the
sample.
56. Method Of Hilgard.—Hilgard[39] recommends that samples
should not be taken indiscriminately from any locality you may
chance to be interested in, but that you should consider what are the
two or three chief varieties of soil which, with their intermixtures,
make up the cultivable area of your region, and carefully sample
these first of all.
As a rule, and whenever possible, samples should be taken only
from spots that have not been cultivated, or are otherwise likely to
have been changed from their original condition of virgin soils and
not from ground frequently trodden over such as roadsides, cattle
paths, or small pastures, squirrel holes, stumps, or even the foot of
trees, or spots that have been washed by rains or streams, so as to
have experienced a noticeable change, and not be a fair
representative of their kind. He further suggests that the normal
vegetation, trees, herbs, grass, etc., should be carefully observed and
recorded, and spots showing unusual growth be avoided whether in
kind or quality, as such are likely to have received some animal
manure or other outside addition.
Specimens should be taken from more than one spot judged to be
a fair representative of the soil intended to be examined as an
additional guarantee of a fair average.
After selecting a proper spot pull up the plants growing on it, and
scrape off the surface lightly with a sharp tool to remove half-
decayed vegetable matter not forming part of the soil. Dig a vertical
hole, like a post-hole, at least 20 inches deep. Scrape the sides clean
so as to see at what depth the change of tint occurs which marks the
downward limit of the surface soil, and record it. Take at least half a
bushel of the earth above this limit, and on a cloth (jute bagging
should not be used for this purpose, as its fibers, etc., become
intermixed with the soil) or paper break it up and mix thoroughly,
and put up at least a pint of it in a sack or package for examination.
This specimen will, ordinarily, constitute the soil. Should the change
of color occur at a less depth than six inches the fact should be noted,
but the specimen taken to that depth nevertheless, since it is the least
to which rational cultures can be supposed to reach.
In case the difference in the character of a shallow surface soil and
its subsoil should be unusually great, as may be the case in tule or
other alluvial lands or in rocky districts, a separate example of that
surface soil should be taken, besides the one to the depth of six
inches.
Specimens of salty or alkali soils should, as a rule, be taken only
toward the end of the dry season, when they will contain the
maximum amount of the injurious ingredients which it may be
necessary to neutralize.
Whatever lies beneath the line of change, or below the minimum
depth of six inches, will constitute the subsoil. Should the change of
color occur at a greater depth than twelve inches the soil specimen
should nevertheless be taken to the depth of twelve inches only,
which is the limit of ordinary tillage; then another specimen from
that depth down to the line of change, and then the subsoil specimen
beneath that line.
Hilgard justly calls attention to the fact that all peculiarities of the
soil and subsoil, their behavior in wet and dry seasons, their location,
position and every circumstance in fact, which can throw any light on
their agricultural qualities or peculiarities should be carefully noted
and the notes sent with the samples. Unless accompanied by such
information, samples can not ordinarily be considered as justifying
the amount of labor involved in their examination.
57. Whitney[40] suggests that a geologic map of the region to be
sampled should always be at hand and that all samples should be
rejected from spots showing local discrepancies, washings or other
disturbances.
The kind of analyses to which a sample is to be subjected also
largely determines the method to be pursued in selecting it: For
instance, a sample to be used for determining the size of the particles
therein, may be taken in quite a different manner from that designed
only for the determination of moisture.
58. In the directions collated by Richards[41] and which have been
largely followed by the correspondents of the Department of
Agriculture, it is recommended to select in a field, four or five places,
at least, per acre, taking care that these places have an homogeneous
aspect, and represent as far as possible the general character of the
whole ground. If the field, however, present notable differences,
either in regard to its aspect or its fertility, the samples gathered
from the different parts must be kept separate.
The sampling of arable soil should be made only after the raising
of the crop and before it has received any new manure. In other soils
the sample should be taken only from spots that have not been
cultivated.
59. In the method of soil sampling adopted by the German
Experiment Stations[42] it is directed that the samples of soil should
be taken according to the extent of the surface to be sampled, in
three, five, nine, twelve or more places at equal distances from each
other. They should be taken in perpendicular sections to the depth
turned by the plow; and for some studies of the subsoil to a depth of
sixty to ninety centimeters. The single samples can be either
examined separately or carefully mixed and an average portion of the
mixture taken.
60. Method of the Official French Commission.—The
official French commission[43] emphasizes the fact that the sample of
soil taken for analysis, should represent a layer of equal thickness
through the total depth of its arable part. An analysis of the subsoil
taken in the same way, will often be useful to complete the data of
the soil study.
First of all, according to this authority, it is necessary to determine
the point of view from which the sample is to be taken. If the object is
a general study, having for its aim the determination of the general
composition of the soils of a definite geologic formation, the sample
should be taken in such a way that the different characteristics of the
soil alone should enter into consideration without paying any
attention to its accidental components, which have been determined
by local causes, such as are produced by continued high cultivation,
the application of abundant fertilizers, or the practice of a particular
line of agriculture. The samples of soil therefore, with such an object
in view, should be taken on parts of the earth which are beyond the
reach of the causes mentioned above and which tend to modify the
nature of the primitive soil. In such a case it is the soil which has not
been modified, or better still, virgin soil, such as is found in the
woodlands and prairies, which should be taken for a sample,
choosing those places in which the geologic formation is most
perfectly characterized. In such a case a soil taken in one spot
corresponding to the conditions before mentioned, would be the best
for the purposes in view. The sample would thus represent a true
type to be studied, not one of a mean composition got by taking
samples from different localities and mixing them into a
homogeneous parcel. This last method of proceeding could introduce
into the sample earth modified by culture or by influences purely
accidental. However, it would be wise, in a region characterized by
the same geologic formation, to take a certain number of samples in
different localities, and examine singly each one of them in order to
be assured that there is a uniformity of composition in the whole of
the soils.
If, on the contrary, it is the purpose of the investigation to furnish
information to the cultivator concerning the fields which are worked,
it is necessary to approach the problem from a different point of
view. In this case the earth which is under cultivation should be first
of all considered with all the modifications which nature causes or
practical culture has caused, in it. But it often happens that upon the
same farm the natural soil is variable, caused either by the washings
from the adjacent soils, by the accumulation at certain points of
deposits formed from standing water, or from other reasons. In such
a case it would be necessary to take samples from every part of the
field which exhibited any variation from the general type, in order to
get a complete mean sample of the whole. It is necessary to be on
guard against making a mixture of these different lots which would
neither represent the different soils constituting the farm nor their
mean composition. It would be better to examine each of these
samples alone and then from those parts which appear to have a
similar composition, to take a general sample for the mean analysis.
Most often it is necessary to confine our studies to the really
important part of the farm the composition of which would have a
practical interest. The aspect of the spontaneous vegetation in such a
case, will often serve as a guide to determine the parts of the farms
which are similar in nature. The sample should represent the arable
layer, properly so-called, that is, that part of it which is stirred by the
agricultural implements in use and in which the root system of the
plant takes its greatest development and which is the true reservoir
of the fertilizing materials.
When a trench is dug in the soil it is easy to distinguish the arable
layer from the subsoil. In the first place, its color is different,
generally being modified by vegetable débris which forms the supply
of humus. The depth of the arable layer is variable, but it is most
frequently between 200 and 300 millimeters. In the analysis the
depth and layers should be indicated since the chemical composition
of the earth varies according as the sample is taken to a greater or
less depth. As an example of this it may be said that the quantity of
nitrogen decreases in general in proportion as the depth of the layer
is increased. The sample, therefore, should be limited exactly to the
arable layer of soil.
61. Caldwell[44] advises that according to the purpose of the
analysis samples be taken:
a, from one or from several spots in the field, in order to subject
each sample to a separate analysis; or
b, for an average representation of the soil of the whole field; in
this case, several portions of earth are taken from points distributed
in a regular manner over the field, all of which are most carefully
mixed together, and 4–6 kilograms of the mixture, free from any
large stones, are preserved as the average sample.
An excavation in the soil 30–50 centimeters deep, or through to
the subsoil, and 30–50 centimeters square, with one side as nearly
vertical as possible is made and a slice taken from this side of
uniform thickness throughout, weighing 4–5 kilograms. If the
subsoil is to be examined, a sample of it should be taken out in the
same manner as directed for the upper soil, to the depth of about 60
centimeters.
If the character of the soil varies materially in different parts of the
field, samples from several spots should be analyzed separately.
A small portion of the sample should be put at once in a well-
stoppered bottle; the remainder may be allowed to become air-dried,
by exposing it in a thin layer, in summer, to the common
temperature in the shade, or, in winter, to that of a warm room, or a
moderately warm drying-chamber, heated to 30°–40°; in either case
it should be carefully protected from dust.
At the time of taking the sample of the soil, observations should be
made in regard to the following points:
a. The geognostic origin of the soil.
b. The nature of the underlying strata, to the depth of 1–2 meters,
if practicable.
c. The meteorology of the locality, by consulting meteorological
records, if possible; otherwise, by the general opinion of the
neighborhood; in this connection, the height of the locality above the
level of the sea should be noted also.
d. The management and rotation of crops in previous years.
e. The character of the customary manuring.
f. The amount of the crops removed in the preceding year, and, if
possible, the average amount of each of the more important crops
yielded by the field.
g. The practical judgment of neighboring farmers in regard to the
field.
Caldwel’s method is practically identical with that of Wolff[45]
which was one of the earliest of the systematic schemes for taking
soil samples.
62. Wahnschaffe[46] insists on rather a fuller preliminary
statement to accompany soil samples but gives essentially the
method of Wolff with some unimportant variations which add little
to the value of the process.
63. Method Of Peligot.—According to Peligot[47] the taking of
samples of soil of which the physical and chemical properties are to
be determined is a delicate operation.
These samples should represent as nearly as possible both the
good and bad qualities of a soil.
In the field selected are chosen a certain number of places at least
four or five per hectare. The spots selected should have a
homogeneous appearance—resembling as nearly as possible the
general aspect of the field.
By means of a spade a few kilograms of earth are removed to the
depth of the subsoil being careful to include in the sample no
accidental detritus which the upper part of the soil especially may
contain.
The samples should be taken immediately after the crop is
harvested and before any fresh fertilizer is applied. The samples are
carefully mixed and placed in a glass bottle or flask.
The sample of subsoil is obtained in the same manner. If the field
presents notable differences in surface or fertility all the samples
taken should be examined separately.
64. Method of Whitney.[48]—An ordinary wood auger, 2½
inches in diameter is so arranged as to admit of additions to the stem
to enable the operator to take samples at different depths. It may be
fitted with a short piece of gas pipe for a handle and the several
pieces of which it is composed may be taken apart and carried in a
knapsack.
In taking a soil sample the boring is continued until a change in
color shows that the subsoil has been reached. The auger cuts a very
clean sample save in excessively sandy soil. After the soil sample is
secured the hole is cleaned out and the sample of subsoil taken by
the same instrument. The soil is conveniently preserved in heavy
cloth bags of which the usual size is 6 by 8½ inches. Where larger
samples are required the size of the bag is correspondingly increased.
Each bag is to be tagged or labeled to correspond with the entry in
the note book.
Samples to determine the amount of empty space in a soil are
taken as follows: The sampler is a piece of brass cylinder about nine
inches long and about 1½ inches in diameter. A piece of clock spring
is soldered in one end and sharpened to give a good cutting edge.
This arrangement permits the sample to pass into the cylinder
without much friction. The area enclosed by the clock spring is
accurately determined and a mark is placed in the cylinder six inches
from the cutting edge. The cylinder is driven into the soil to a depth
of six inches, a steel cap being used to prevent the hammer from
injuring the cylinder. The earth is next removed from about the
cylinder with a trowel, and the separated cylinder of earth is cut
smoothly off by a sharp knife and removed together with its brass
envelope. The sample is taken to the laboratory in a cloth bag, dried
and weighed.
65. Taking Samples for Moisture Determination.—A
number of brass tubes is provided nine inches long and ¾ inch in
diameter and with a mark six inches from the bottom.
The tube is pushed down into the soil to the mark and the sample
of soil removed with the tube. There is but little danger of the sample
dropping out of the tube even in sandy soils. When the tube is
withdrawn each end is capped with a rubber finger tip making a
perfectly air tight joint. The tubes containing the samples can be kept

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Guide to Local Government Finance in

State and Local Government 11th Edition Ann O'M Bowman

Innovative Infrastructure Finance: A Guide for State

Corporatisation in Local Government: Context, Evidence

VBA for Accounting & Finance: A crash course guide:

Education Across the United Kingdom 1944–2017: Local

Financial Analyst: A Comprehensive Applied Guide to

Governing California in the Twenty-First Century

Vanishing Borders of Urban Local Finance: Global

Chapter 5. Special Revenue Funds: The Inflexible Funds .......................... 45

Chapter 6. Enterprise Funds: The Business-like Funds ............................. 53

Chapter 7. Budgets and Fiscal Policy: Allocating Resources

Chapter 8. Labor: Employing People .......................................................... 93

Chapter 10. Capital Improvements and Debt

Chapter 11. Investiments: Managing the Public’s Portfolio ...................... 137

Chapter 12. Reporting: Accountability and Telling

Chapter 13. Local Economic Development: Fostering

Chapter 14. Real Estate Development Feasibility and the

Chapter 15. Fiscal Impact Analyses: Costs and Revenues

Chapter 16. Looking Back: A Brief History of California

Chapter 17. Going Forward: Outlook and Reform .................................... 239

Appendix B. Detailed City Budget Process ............................................... 261

Appendix C. Presenting Financial Information ........................................ 279

Appendix D. Useful Information Sources ................................................. 297

Bibliography ............................................................................................... 307

Glossary ...................................................................................................... 309

Index ........................................................................................................... 325

Michael Multari, Kenneth Hampian, and Bill Statler

Of course, any errors in the book are our own responsibility.

— MM, KH, WCS, MC

society’s capacity to deliver effectively basic day-to-day services to its

Purpose of the Book

This book has been written primarily to provide a practical understanding of

Roadmap to the Major Topics

Part I: Introduction and Overview

Anyone who wants a thorough grounding in municipal finance—what it

Chapter 2 sets the stage by providing an overview of what California local

Part II: Funds

Chapter 3 introduces the concept of funds—how money from different

Chapter 5 looks at “special funds,” restricted funds whose revenues must be

Chapter 6 focuses on the “enterprise funds,” the business-like funds

Part III: The Practice

Chapter 7 introduces the “kingpin” of local government financial practice,

Chapter 8 discusses the foremost budget driver—labor, the cost of employing

Chapter 9 is about purchasing—buying things and contracting for

Chapter 11 addresses another vital practice, investment, managing the

Chapter 12 covers reporting and accountability—the ways that an agency

Part IV: Development and Real Estate Finance

Chapter 13 examines a field of municipal finance that currently earns a lot of

Constituents. No. 1. No. 2. No. 3. No. 4.

99.72 99.97 99.84 100.35

Carbon. Hydrogen. Nitrogen. Volatile matter.

Common names. Botanical names.

Humin and Humic Acid.

Carbon 64.4 per cent Corresponding to C₂₁H₂₄_O₁₂ + 3H₂O

Carbon 44.0 per cent Corresponding to C₁₂H₁₂O₈?

Carbon 34.4 per cent Corresponding to C₂₄H₂₄O₁₂?

TAKING SAMPLES OF SOIL FOR ANALYSIS.

54. General Principles.—It would be unwise to attempt to give