This paper deals with an efficiency of current municipal expenditure on environmental protection and suggests a methodology for assessing this efficiency. A proposal of methodological procedure for evaluating efficiency of municipal environmental protection expenditure uses multi-criteria evaluation, where a dominant criterion of performance is modified method of Cost-effectiveness analysis. It was implemented in open source software. The efficiency in the methodology is intended in terms of 3E methodology – Economy, Efficiency and Effectiveness, together with the methodology of sustainable development – social, environmental and economic part of sustainable development. This procedure is applied to a set of environmental protection expenditure data that come from the representative sample of municipalities in areas of waste management which were used in a project of the Ministry of Environment of the Czech Republic SP/4i1/54/08 “Analysis of municipal budgets efficiency in relation to the environmental protection”.