ABSTRACT
Benefits ofDecentralization The Government of Nicaragua transferred the management of the local water service in Matagalpa to the municipal government in February 1991. The transfer resulted in efficient, cost-effective water service. Since 1991 the number of families connected to the service has increased by 59 per cent. The municipality incorporated innovative methods of community involvement in developing the municipal system and covered some of its capital costs through municipal bonds held by municipal employees. The transfer has received a particularly strong response from the community's poorer citizens and the expansion of service has created many jobs.
