Fiscal First Aid

The Last Line of Financial Defense? Internal Loans in Emergency Situations

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The Last Line of Financial Defense? Internal Loans in Emergency Situations

General fund reserves are one of local governments’ primary resources for responding to unexpected financial losses, such as those brought about by natural disasters or man-made extreme events. However, it is neither practical nor desirable for a government to accumulate enough reserves to respond to every possible contingency it might face — that would simply not be affordable for most communities.


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