There is incentive for privatization of a wide range of government services from garbage collection to recreation, where the private sector can provide the services more efficiently than local governments. Great diversity is also evident in local government response to tax and spending limits in Colorado. The purpose of tax and spending limits is to constrain the growth of revenue and expenditures, and reduce the tax burden on citizens. At the local level tax and spending limits work pretty much as they were envisioned. Mill levies are adjusted to conform to these fiscal constraints.
Local governments have the option of seeking voter approval for an increase in the mill levy.
Nearly four thousand of these fiscal issues have been placed on local ballots in the past nine years. However the voting on these ballot measures reveals that taxpayers are discerning, decreasing as well as increasing taxes depending upon the level of government and the quality of government services they receive. Surveys show that Colorado citizens have more confidence in local government than state government, and least confidence in the federal government. Local tax competition gives Colorado citizens choices in where they shop, live, and work. Local tax competition gives firms a choice in where to invest.