December 2011 Municipal Cost Index dips

Last month, the overall costs of goods and services purchased by local governments decreased 0.2 percent, according to American City & County's Municipal Cost Index. The December 2011 Municipal Cost Index value of 223.7 is 4.2 percent higher than last year.

Most items tracked by American City & County showed only slight price changes. However, after increasing 7.3 percent last month, diesel fuel (No. 2) decreased 5.5 percent, and natural gas prices continued to drop 5.9 percent after last month's decrease of 8.6 percent. Home heating oil and distillates also decreased 6 percent.

Overall, fuel prices show the greatest price increases over last year among the items tracked by American City & County. Diesel fuel is up 27.3 percent, gasoline is up 26.2 percent, and home heating oil and distillates are up 26.1 percent over the last year. Natural gas is down slightly (0.4 percent) from last year. Electronic computer prices have decreased 11.3 percent since last year, which is the greatest decrease of all items tracked by American City & County.

The Municipal Cost Index, developed exclusively by American City & County, is designed to show the effects of inflation on the cost of providing municipal services. State and local government officials rely on American City & County's Municipal Cost Index to stay on top of price trends, help control price increases for commodities, make informed government contract decisions and intelligent budget planning. Since 1978, readers have loyally referred to the Municipal Cost Index to determine the cost of inflation and, hence, the rising cost of doing business as a local government.

American City & County's Municipal Cost Index for December 2011 is available now at americancityandcounty.com/municipal-cost-index/2011. For a complete archive of the index since 1978, visit americancityandcounty.com/municipal-cost-index.