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Fiscal stress has forced Ohio local governments to pay increasing attention to the importance of revenue forecasting. This paper identifies and examines two Ohio local governments’ revenue forecasting approaches and forecasting accuracy using the case study method. It compares the differences in forecasting methods used. This research finds that informal forecasting methods are used by the county and formal forecasting methods are used by the city, that forecast accuracy varies by level of revenue aggregation using the informal method, and that depending on the revenue source, simple methods are more appropriate than complex methods.

Strategic planning in all sectors of government is currently experiencing greater use. Strategic planning in the federal government, for example, is now mandated and the emphasis is on “managing for results” (Roberts, 2000). At the same time, capital budgeting in all sectors of government is also receiving greater attention because of the recognition of greater need for attention to funding infrastructure. In this study, the relationship between the municipal strategic plan and the capital budget and their effect on financial performance is examined. Based on the analysis, the strategic plan, when connected to the capital budget, was found to have a statistically significant effect on selected aspects of municipal financial performance. The findings for practitioners indicate that strategic planning and capital budgeting are a major influence on financial performance and that the combination of capital budgeting and strategic planning constitutes a strategic decision-making process.