In the event of a municipal financial crisis, what is one of the first actions a CMFO should take?

When faced with a municipal financial crisis, one of the first actions a Certified Municipal Finance Officer (CMFO) should take is to identify and assess the root cause of the crisis. Understanding the underlying issues is crucial for effectively addressing the situation and formulating a response plan. This analysis allows the CMFO to gather relevant financial data and assess the municipality's financial health, enabling informed decision-making.

By identifying the root cause, the CMFO can determine whether the crisis is due to revenue shortfalls, unexpected expenditures, or other financial mismanagement. This foundational assessment informs subsequent steps, such as preparing reports, holding public meetings, or adjusting budget strategies. Without this critical first step, any actions taken may be misdirected or ineffective in resolving the crisis. Therefore, recognizing and understanding the factors contributing to the financial distress is vital for effective crisis management and planning for recovery.