The latest data show that, over the past two years, revenues from property taxes and recurrent fees increased 58% in Albanian municipalities which implemented tax management technology with the support of the USAID’s Planning and Local Governance Project (PLGP) versus an 11% increase in other municipalities. That translates to the equivilant of millions of additional dollars in these municipalities for public services and facilities.

“We see tangible evidence of the success of our initiatives just about every day,” says the USAID Project’s Chief of Party Kevin McLaughlin. “We can point to several areas of  increased productivity, increased revenues, and people empowered through information.”

When the USAID Project  began working in Albania in 2012, local governments had limited political autonomy and even more limited fiscal and administrative authority. Inadequate legislation defined national/local responsibilities and scarce financial resources strained the capacity of municipalities to deliver services.

The USAID Project helped the national government draft major laws on territorial-administrative reform, which merged 373 local government units into 61 municipalities; on fiscal decentralization, which gave municipalities more control over their finances; and on local government finance, which gave local governments a greater annual share of national unconditional grant funds. The Project has trained public officials and staff on how best to implement those laws and deliver effective public services.  And it has emphasized citizen engagement.

“The changes in Albania have been extraordinary,” says McLaughlin. The USAID Project’s measurable success in helping governments guide that change has provided many lessons learned. What does the Project’s nearly seven years of experience teach us?  “I think there are a few key factors to our success,” says McLaughlin.

• “There’s nothing ad hoc about what we do. Our comprehensive approach achieves an effective balance between the various aspects of our intervention: legislation, institutional capacity building, public service delivery, citizen empowerment, training on grant writing, public-private partnerships, and raising local own-source revenues. Our approach maximizes the effectiveness of governance, as one aspect reinforces the other.
• “We work effectively with multiple municipalities with an agreed framework which expresses our mutual commitment and clearly outlines areas of responsibility and facilitates cooperation. We work intensively with 13 partner municipalities and often share our findings with all 61 municipalities. We work with them to solve practical problems, in such areas as urban planning, economic development, water system management, and property tax collection. There are ample opportunities for peer-to-peer exchange to generate a shared understanding of common issues.
• “We have been able to deliver our approach and investment over the long term. Achieving and maintaining institutional change is a long-term effort of encouraging and incentivizing new patterns of behavior so they are replicated across the institution until they become routine and improve overall performance.
• “Our evidence-based approach includes not only sharing international best practices but creating original data. Often in policy debates or practical planning, crucial data are unavailable or unreliable to give us adequate insight. Rather than make less-than-rigorous arguments or risk producing a product that isn’t of the highest quality, we will conduct research, analyze the findings, produce a report and other content, and share both the findings and the methodology used to produce them.

“The second “P” in PLGP stands for ‘Project’, but it really should be ‘Process’”, says McLaughlin. “We long ago evolved to where our process informs how we distribute resources, how we meet defined and practical needs.”

“Our process-based approach allows us to fully consider the resources that are required and the context in which they must work-the laws, policies, and multiple constraints that apply.” Kevin McLaughlin, Chief of Party of the USAID’s Planning and Local Governance Project