This report’s main aim is to propose a methodology for assessing state-budget-funded projects based on a rigorous selection model, including clear and effective prioritization criteria. This report first argues that project prioritization and selection should be optimized against four dimensions: absorption, impact, legitimacy, and capacity. Second, it provides a diagnostic of the National Program for Local Development (PNDL), managed by the Ministry of Regional Development and Public Administration (MRDPA), as the most significant source of state-budget funding for local infrastructure projects. The PNDL’s current design and implementation leaves room for improvement, as reflected by the lack of strategic direction in allocating funds and the continued rise in the number of projects that get started without a feasible timeline for their completion. Further, this report makes recommendations for improvement of project evaluation and selection procedures for local infrastructure development projects, with a special focus on prioritization criteria and viable funding sources for each type of investment. The practical purpose is to enhance the efficiency and effectiveness of proposed investments, maximizing impact in the context of inherently limited available financial resources. A complementary focus is on opportunities for harmonizing and better coordinating investments across various sources of funding, in the context of nearly EUR 40 billion available to Romania from the EU for the 2014-2020 programming period.