Eight Biggest Challenges for Local Governments Today

Local governments are on the front lines of tackling some of the toughest challenges facing the US today. From navigating declining public trust to embracing new technologies and securing financial stability, these issues shape the future of our cities and towns.

How effectively local leaders address these challenges will be vital in building resilient, thriving communities.

As 2025 quickly approaches and following the recent International City/County Management Association (ICMA) Annual Conference in Pittsburgh, we wanted a clearer picture of what lies ahead for city management.

So, we asked practitioners and thought leaders around the nation to share their thoughts on the biggest challenges facing local governments throughout the coming year.

1. Full Adoption of AI Tech for Public Service

Matthew Schmitz “I think hugely important is figuring out how to maximize the opportunity of artificial intelligence advancement in an ethical and fair manner to help the populations we serve as much as possible. This will be a challenge we all have to figure out in the coming year. And then, of course, is the challenge of finding money to pay for programs.” – Matthew Schmitz, City Manager, City of Independence, Iowa

2. Investing in Basic Services and Infrastructure

Pam Davis “The fundamental value of local government rests on clean water, safe streets, green spaces, emergency response – things that are often invisible and taken for granted. We need to ensure that we can sustain them for future generations. This means creating more compelling stories to engage our communities and elected officials on the dire importance of investing in maintaining our basic services and infrastructure. ” – Pam Davis, Assistant City Manager, City of Boulder, Colorado

3. Solution-Driven Community Engagement Despite Civil Discord

Brent Stockwell “The challenge will be continuing to pursue engagement on difficult issues with the community in the midst of increasing civil discord. As things get more difficult, sometimes the temptation is to withdraw or withhold, rather than pressing on with the tougher work of continuing to communicate, consult, and collaborate with our communities to solve the tough problems we face together.” – Brent Stockwell, Assistant City Manager, City of Scottsdale, Arizona

4. Community Mental Health and Social Support

Adrienne Wise “From a trauma-informed care perspective, one of the biggest challenges for local governments is ensuring equitable access to mental health services and support systems for individuals affected by trauma, particularly in the wake of events such as the COVID-19 pandemic. This involves recognizing the widespread impact of trauma on community members and integrating trauma-informed practices within various public services, including healthcare, education, and social services. Local governments need to train staff across departments to understand trauma and its effects, create safe and supportive environments, and foster collaboration among agencies to provide comprehensive support. Additionally, addressing systemic issues such as housing instability, poverty, and discrimination is crucial, as these factors can exacerbate trauma and hinder recovery. The challenge lies in creating a cohesive strategy that prioritizes trauma-informed approaches while also addressing the broader social determinants of health.” – Adrienne Wise, CEO, Wise Choice Counseling & Consulting Services®

5. Financial Stability and Resilience

“Ever important is ensuring financial stability to sustain services, promote growth, and maintain resilience.” – PJ Gagajena, Assistant City Manager, City of Moorpark, California

6. Rapid Change and Risk Management

Michelle Kobayashi “Communities across the nation are changing at an unprecedented rate, and local governments are struggling to provide the leadership and oversight required. Americans have faced pandemics, natural disasters, an aging workforce, and increasing polarization and misinformation at the national level, eroding public trust. While technology holds great promise to address many of these challenges, local governments may struggle to determine the best ways to leverage it. Furthermore, since government is not typically known for innovation and risk-taking, bold leadership and a strong focus on change management will be essential.” – Michelle Kobayashi, Principal Research Strategist, Polco

7. Employee Recruitment and Retention

“Public service has lost its appeal as a career option. How can we change our roles, work environments, and expectations to make a career in public service desirable again to attract and keep the very best candidates?” – Cory Poris Plasch, CEO, CP2 Consulting

8. Strategic Leadership Ahead of Uncertain Times

Tobin McKearin “City managers face the challenge of focusing on being prescriptive rather than reactive. There are so many things going on, from positives like advancements in technology and funding access to negatives like increasing polarization and greater demands on public services. Everything that local governments manage has become more complex. It is easy to get caught up in the daily grind to survive. But local governments need to think of the future: how do we set ourselves up now for success in one year, three years, ten years, etc? Communities need governments to lead us there now for the best outcomes.” – Tobin McKearin, VP of Data Science, Polco

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