Participatory Budgeting

Description and History

According to the Participatory Budgeting Project, participatory budgeting (PB) is “a democratic process in which community members decide how to spend part of a public budget. It gives people real power over real money” (PBP 2024). Through PB, residents create project or budgetary proposals, which are then voted on and funded by the government. On a smaller scale, an individual organization—like an anchor institution or a school—can also engage in participatory budgeting.

PB started in Porto Alegre, Brazil in 1989 for everyday citizens to have greater control over how public money was being spent, specifically to address poverty in the region. Since then, more than 7,000 cities across the world have carried out some type of PB process (PBP 2024). These range from small towns with 21,000 residents to regions with 14 million people (Menser 2018). In the United States, at least 64 cities and counties have conducted PB processes, in addition to 258 districts or wards and over 260 schools—allocating over $360 million (Miller 2024). Funding for PB can come from a variety of sources, including: discretionary funds of elected officials; city, county, or state budgets; public agency budgets; school, school district, or university budgets; federal funding like Community Development Block Grants; Community Benefit Agreements (CBAs); Tax Increment Financing (TIF) dollars; anchor institution community benefit funds; philanthropy; nonprofits; and/or grassroots fundraising (PBP 2017).

Participatory Budgeting, Locally Rooted Finance, and the Community Wealth Building Wedge 

Participatory budgeting is associated with a range of positive outcomes: promoting social well-being, supporting civic associations, and empowering individuals. Research on municipalities in Brazil with PB documented a significant shift in spending toward meeting social needs—dramatically increasing investment in health care, sanitation, infrastructure, and education—reducing infant mortality and dramatically increasing school enrollment (Malleson 2014). 

On an individual level, PB allows people to develop their civic skills as they discuss community issues and work toward their resolution. This process provides the opportunity for people to develop their sense of political agency—meaning they feel capable of effecting change and/or that the political system is amenable to change. In New York City, for example, voters who participated in The People’s Money were seven percent more likely to vote in future general elections (PBP 2018). PB also has a record of bringing new voices into the political process, particularly those from marginalized communities, which is especially important for CWB. For example, people of color and lower income residents have been better represented in New York City’s PB processes as compared to local elections (Menser 2018). 

This expansion of “little d” democracy is critical to equipping individuals and communities with the tools they need in order to redirect resources toward and effectively govern CWB actions. 

Examples

Durham Participatory Budgeting 

In Durham, North Carolina, residents are engaged from idea sollicitation to budget delegation to voting to implementation and evaluation. Now in their third cycle of advancing PB, the City of Durham collected over 600 ideas from residents all across the city including the five winners: additional security measures, lighting at the parks, sustainable improvements of parks, pedestrian safety, and teen equipment at recreation centers. The City was able to engage more than 12,000 residents—who matched the racial composition of the city at large—promoting not just participation, but true ownership over $2.4 million of public money (Durham Participatory Budgeting n.d.). It is important to note here, however, that the City’s total budget is over $900 million, so expanding such efforts beyond a meager 0.2% is critical to advancing control. 

Phoenix Union High School District (PUHSD)

The first school district to engage in a PB process was Phoenix Union High School District (PUHSD) in Arizona. In 2017, five schools in Phoenix came together to transform educators’ and students’ ideas for school improvements into project proposals to be voted on by 3,854 students—an average of over 80% turnout rate. During the initial process, students directly decided how to spend $26,000 in school district funds (PBP 2017). Not only did students and staff learn from the process, but in exercising democracy, the overall school community was strengthened. In 2024, that number is $1.2 million of the School Safety Officer (SRO) budget, with students, staff, and parents/guardians allocated a piece of the pie to distribute (Phoenix Union High School District 2024). 

Challenges & Limitations

Success with PB is not assured. First and foremost, while several cities around the world have implemented PB processes, many have simply moved from ignoring their constituents to consulting them (Movement Strategy Center 2019). Second, participation can be biased toward those with the means to attend meetings and suffer from the “tyranny of the eloquent,” where those with specific skills or qualities (e.g., those perceived as extroverted, charismatic, or articulate) dominate participation. Oftentimes, this domination falls along lines of race and class (Stacy et al 2022). Third, PB may also myopically focus on short-term or easy-to-solve issues while larger, more systemic issues go unresolved. Fourth, PB can suffer from insufficient funding or funding can be eliminated altogether when political circumstances change. In one article from the Urban Institute, researchers encourage crafting legislation to ensure that the process can continue over time, weathering the storms of electoral politics (Stacy et al 2022). Finally, as noted in the Durham example above, most PB efforts are for a small, fairly insignificant part of an organizational budget. 

Taking It Forward

To address the aforementioned challenges, participation can be facilitated by providing technical assistance, meeting facilitation training, popular political education sessions, childcare, transportation, targeted outreach, and compensation for participation in research, planning, and monitoring processes. Scholars have also suggested that residents participate in assessing community needs, along with the implementation and monitoring of PB projects to help ensure substantive issues—not just the most conspicuous ones—are effectively addressed (Hildreth and Miller 2018).

Additional Resources