Soaring inflation rates, the threat of recession, increasing reliance on federal and state grants, taxpayer revolt, public employee unrest, and fears of default all describe the current economic and political envi­ronment in which local governments operate. Despite the uncertainties of this environment, government decision-makers must anticipate the future in making fiscal decisions that have implications for periods longer than the traditional single budget year. Collective bargaining negotiations often involve multi-year contracts, capital spending deci­sions imply long-term debt service and operating expenditure commit­ments, and decisions to increase service levels can have longer-term implications. The recent and considerable interest in multi-year fore­casts of expenditures and revenues is not surprising and is overdue.

In this paper we discuss, in general terms, how cities have approached the multi-year forecasting problem and how the outputs from such efforts have been used.