LOCAL BUDGET AS FINANCIAL BASIS OF DEVELOPMENT OF TERRITORIAL COMMUNITIES

Object of research are theoretical and practical issues of local budgets as the financial basis of local communities. Research objective is disclosure of local budget as a tool for social and economic development areas. Research methods. The paper applied a set of scientific methods and approaches, including systemic, structural, comparative, factorial methods, allowing to implement conceptual integrity of the study. Results of work. The essence of local budgets as the financial basis of local communities. The features of the formation of local budgets in terms of economic transformation. The essence of financial security of local budgets as part of intergovernmental relations, which is to use a set of institutional arrangements of local budgets, taking into account the degree of balance of financial and economic relations. At the present stage of the budget system is necessary to increase the financial capacity of local governments to strengthen their own revenue base of local budgets. Developed approaches to budget management of socioeconomic environment, the efficiency of planning the expenditure of local budget priorities based on socio-economic development of administrative units. It is proved that the system of intergovernmental relations needs further improvement based on the dynamics of financial and socio-economic indicators of areas based on quality standards to ensure local people sufficient level of social security. Scope of results. Local Finance. Local governments in the intergovernmental fiscal regulation. Conclusions. Formation of local budgets in budget management system is an important tool for implementing financial and economic policy, part of the mechanism of intergovernmental relations, the main lever of social and economic development of administrative units. Fiscal policy in the field of local budgets include activities related to revenue mobilization, redistribution, use, providing financial equalization territorial and municipal public funds of funds in the sustainable management of the budgetary resources of the state. Improving the quality of the intergovernmental system improvement is possible if the distribution of functions and powers between the state and local authorities on the basis of balancing national and regional interests. Separation of expenditure and revenue powers should be based on reasonable grounds, it is reasonable to improve the mechanism of distribution of intergovernmental transfers to local budgets. Further development of the local budgeting advisable to from the experience of developed countries and economies in transition in roles of increasing their own revenues, increasing the financial basis of local government.