FISCAL SUSTAINABILITY MELALUI PENDAPATAN ASLI DAERAH, BELANJA MODAL, DAN DANA PERIMBANGAN

This paper analyzes the influence of Locally Generated Revenue (PAD), capital expenditure, and Intergovernmental Transfers (Balancing Funds) on fiscal sustainability in Situbondo Regency. A quantitative approach was employed using secondary data derived from the monthly Budget Realization Reports (LRA) of Situbondo Regency for the period 2021–2025. The study utilized a saturated sampling technique, with all monthly observations included in the analysis (n = 60). Fiscal sustainability was measured using the regional fiscal independence ratio, which reflects the ability of the local government to finance its expenditures through its own-source revenue. Data were analyzed using multiple linear regression. The findings reveal that Locally Generated Revenue (PAD) has a positive and significant effect on fiscal sustainability, indicating that stronger revenue-generating capacity enhances regional fiscal independence and supports the sustainability of local public finances. Capital expenditure exhibits a negative but insignificant effect, suggesting that capital spending has not yet been optimally translated into improved fiscal capacity and long-term fiscal sustainability. In contrast, Intergovernmental Transfers (Balancing Funds) have a negative and significant effect on fiscal sustainability, implying that excessive reliance on central government transfers may weaken regional fiscal autonomy and increase fiscal vulnerability. These findings highlight the importance of strengthening local revenue sources and improving the effectiveness of public expenditure management to support sustainable fiscal development at the regional level.