Local governments from Second (New York, Northern New Jersey and Fairfield County, Connecticut) and Third (Eastern Pennsylvania, Southern New Jersey and Delaware) Federal Reserve District States are highly dependent on 1) state aid derived from personal income and sales taxes, 2) capital gains on asset valuations generated from the Financial, Insurance, and Real Estate (FIRE) industries, and 3) local property tax revenue.

This article is a supporting document from the Alliance for Innovation Navigating the Fiscal Crisis white paper.