Municipal reporting and the implementation of the FDTA
XBRL US held its GovFin2023 conference in Washington DC yesterday. The event brought together a significant number of experts from the XBRL community, US regulators as well as state and municipal reporting experts to discuss the upcoming implementation of the Financial Data Transparency Act or FDTA. There were a number of presentations of note, including the opening keynote from Mark Funkhouser. Mr Funkhouser, a former municipal Mayor, is looking at the implementation of the FDTA for municipal securities not from the perspective of investors, but from the perspectives of cities and towns themselves.
He argues that access to digital financial statements prepared by these municipalities will provide a powerful lens for action. Today’s municipal reporting is buried in dense PDF reports that are pretty much impenetrable and are almost entirely ignored. In an era in which municipalities face significant structural deficits, including through unfunded pension obligations, services are under pressure and citizens are generally unaware why. By unlocking the data that today is exceptionally opaque, it will be possible for local governments — and their residents — to understand local finances, understand the local balance sheet and focus on necessary change. As he says — Money is Power and too many officials at a local level simply don’t understand their current situation, leading to deepening mistrust.
A fascinating talk, not just relevant to US municipalities! Available soon at XBRL US.