According to this model, analysts must also consider the overall costs of services that the community provides. The community's cost burden will be mitigated if substantial aid is received from other sources. Then evaluate this result to see if the cost is potentially too high by performing a statistical fit to determine whether the cost ratios that fall in the top 10 percent to 5 percent of the tail are high. This analysis is based, in most cases, on the need for capital improvements and access to sources of financing. Some sources of revenue and borrowing may be accessible to one community but not to others.
Intergovernmental flows can also greatly alter apparent costs.
The second model proposed by the task force emphasizes rationales for financial relief. It begins with a basic screening test, as in the first approach. The burden of proof then falls on the municipality or system. Clearly define the economic rationales for granting municipalities relief and discuss the links between the relevant rationales and the specific methodologies used. Utilize financial tests that are simple to use, even for non-finance personnel, and tailored to the data available for small systems.