THE OPTIMIZATION OF LOCAL GOVERNMENT ASSET UTILIZATION IN SUPPORTING LOCAL INCOME (PAD): AN EMPIRICAL STUDY IN SALATIGA CITY, CENTRAL JAVA, INDONESIA

Abstract

This study aims to optimize the utilization of the Local Government's asset in supporting Local Original Income (PAD) in Salatiga City, involving: (1) Asset lease to a third party not based on leasing tariff because Salatiga City Government has not had Local Regulation yet about redistribution of local wealth; (2) The direct use of income resulting from the asset leasing to the third party in which the leasing income is used directly for repairing the damaged object. It is because of an agreement loosely governing right and obligation; and (3) Inadequate supervision over object/asset that the third party can utilize. This research uses a survey method conducted in Salatiga, Central Java, Indonesia, which involves relevant regional apparatus organizations, resource persons, and community leaders. The local asset has strategic value. The quality of asset management should be improved along with the attempt to optimize local income. The effectiveness and efficiency of institutional management can be seen, among others, from the comparison between asset size and income. Asset management of Salatiga City Government is conducted, not merely referring to legislation. However, it should also pay attention to usefulness value to improve local original income and usefulness to the people. This research found that asset optimization is inhibited by the function sustainability of internal management and legislative technique.