West Bank and Gaza - Municipal
Finance and Service Provision : Annexes

The main general objective of this study
is to promote a deeper understanding of municipal finance in
the West Bank and Gaza, including identification of the key
issues that local governments currently face. The paper
discusses the policy implications associated with its main
findings as potential policy options for future decision
making on local government reforms. As such, this study aims
at facilitating the process for a future policy dialogue
between the World Bank and the Palestinian Authority (PA) or
Ministry of Local Government (MoLG). Furthermore, it is
expected that the identification of the main issues,
together with their policy implications, may assist the PA
or MoLG in the selection of the key areas that could
potentially benefit from the World Bank's technical
assistance. In particular, this study attempts to: (i)
clarify the actual role that municipalities play in the
provision of local services; (ii) evaluate the current
assignment of municipal revenue sources and determine their
adequacy to cover current expenditure functions, including
an analysis of whether there are unfunded mandates, and if
so, identify the main contributing factors; and (iii)
determine the balance between expenditures and revenues
aiming primarily to assess whether the current revenue
sources cover the estimated costs of the municipal services
that are being provided, and draw the corresponding
conclusions on the current municipal fiscal situation.
Furthermore, this Economic and Sector Work (ESW) highlights
the nature and magnitude of current fiscal imbalances across
municipalities in the West Bank and Gaza.