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Innovative budgeting gives communities a say in spending

Illustration of a hundred dollar bill with cut lines dividing it up into pieces.
Illustration: Aïda Amer/Axios

To address problems bubbling up from communities, some local governments are putting money directly into the hands of their citizens.

The big picture: Participatory budgeting (PB) is a tool that enables residents to determine how a portion of taxpayer dollars are spent. It's getting traction from California to North Carolina.

How it works:

  • Communities are allotted a portion of public dollars to spend as they see fit.
  • Volunteers identify pressing local needs — looking at sectors like transportation, housing, and education — and collaborate with public officials to draft viable budget proposals for how to use the allocated funds.
  • These proposals go to the entire community for a vote before they are enacted.

History lesson: The PB process can be traced back to a successful experiment in Brazil in 1989.

  • After a brutal military dictatorship, the city of Porto Alegre enacted PB to introduce transparent, responsive decision making and government accountability.

The impact: The World Bank and the United Nations Development Program have called participatory budgeting a best practice in democratic innovation, and Portugal is the first country to use it on the national scale.

What we're watching:

  • In Boston, residents ages 12-22 can participate and allocate $1 million per year.
  • Seattle recently expanded an existing program, and now anyone age 11 and older can participate in allocating $2 millon per year.
  • In New York City, over half of the city council allocated a portion of their discretionary funds to the process, which is open to residents as young as 11. Between 2012 and 2018, that resulted in more than $210 million dollars flowing into projects like new technology in libraries.

The bottom line: PB goes beyond creating a process for incorporating civic input into budgeting — it makes civic engagement possible for marginalized communities and involves young residents who aren't yet eligible to vote.

Hollie Russon Gilman is a fellow at New America's Political Reform Program, Georgetown's Beeck Center for Social Impact & Innovation, and Columbia's School of International and Public Affairs.

Public finance