Saturday, September 15, 2012

Fiscal stress continues for hundreds of Michigan jurisdictions, but conditions trend in positive direction overall (mpps-fiscal-health-2012.pdf (application/pdf Object))

mpps-fiscal-health-2012.pdf (application/pdf Object)

The Center for Local, State, and Urban Policy
Gerald R. Ford School of Public Policy, University of Michigan
Michigan Public Policy Survey September 2012

"For the first time since the MPPS began in 2009, fewer than half of local leaders expect their jurisdiction will be less able to meet its fiscal needs next year, as compared to this year. This may reflect a “new normal,” based on cuts in services and staffing that have been made by local governments over the last few years, thereby allowing them to get by with fewer resources.

Still, the overall improvement masks ongoing fiscal distress for hundreds of jurisdictions, for which the worst may be yet to come.  Further, even for those jurisdictions that may have turned the corner toward better times, other factors on the horizon could send them back on a negative path. In recent months, for instance, the U.S. economy appears to have been slowing once again, and should this continue or worsen, it could be expected that local governments would quickly experience negative effects.

In addition, state policymakers in Lansing are expected to re-start efforts to reform the Personal Property Tax, another significant source of funding for local governments. Any significant cuts in revenue from this source could also potentially threaten the nascent improvement in fiscal health for local governments statewide.

While conditions appear to be improving overall, there is no doubt this is still a challenging time for local government in Michigan."

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