The document analyzes public spending and budget cuts affecting Italian municipalities from 2010-2015. It finds that: 1) Municipalities' spending makes up less than 8% of total public sector spending. 2) From 2010-2014, budget cuts totaled over €1.8 billion for Lombardy municipalities, including nearly €1.2 billion from reduced state transfers. 3) Despite financial pressures, most Italian municipalities complied with budget rules, including over 99% of small municipalities subject to the rules for the first time in 2013.