Which statement best describes how intergovernmental revenue differs from property tax revenue?

Which statement best describes how intergovernmental revenue differs from property tax revenue?

• A. Intergovernmental revenue is raised locally through assessments, while property tax comes from federal grants.
• B. Intergovernmental revenue is a fixed fee charged by the city, while property tax comes from state subsidies.
• C. Intergovernmental revenue comes from other governments (federal/state grants, shared revenues), while property tax is raised locally through assessments.
• D. Intergovernmental revenue is only used for capital projects, while property tax funds routine services.

Answer: (C)

Intergovernmental revenue is funds that come from outside the local government, such as federal or state grants and shared revenues, while property tax revenue is raised locally through assessments of property values within the jurisdiction. This distinction is the core idea: where the money originates (other governments versus local property owners) and how it is obtained. Intergovernmental receipts can be grants or allocations with often restricted purposes, and they may support operating costs or capital projects depending on the agreement. Property tax money, collected through local property assessments, typically funds local services like police, fire, streets, and general operations. The other statements mix up where the money comes from or how it’s used. For example, intergovernmental revenue is not a local assessment, and property tax is not a source of state subsidies. It’s also not accurate to say intergovernmental funds are limited to capital projects.

Intergovernmental revenue is funds that come from outside the local government, such as federal or state grants and shared revenues, while property tax revenue is raised locally through assessments of property values within the jurisdiction. This distinction is the core idea: where the money originates (other governments versus local property owners) and how it is obtained.

Intergovernmental receipts can be grants or allocations with often restricted purposes, and they may support operating costs or capital projects depending on the agreement. Property tax money, collected through local property assessments, typically funds local services like police, fire, streets, and general operations.

The other statements mix up where the money comes from or how it’s used. For example, intergovernmental revenue is not a local assessment, and property tax is not a source of state subsidies. It’s also not accurate to say intergovernmental funds are limited to capital projects.