Fiscal health trends reversing--and not for the better--in some Michigan communities

August 22, 2016

After five years of steady statewide improvement, fewer Michigan communities report that they are better able to meet their fiscal needs this year.

A University of Michigan survey polled top elected and appointed officials in the state's 1,856 units of local government and found that 2016 marked a change in earlier trends with 31 percent better able to meet financial needs and 22 percent less able to do so. That compares to 38 percent in 2015 saying they were better able to meet fiscal needs and 20 percent less able to do so.

"For the first time since the end of the Great Recession, the trend of more and more local officials reporting gradual improvements in fiscal health overall has reversed," said Thomas Ivacko, administrator and program manager of the Ford School's Center for Local, State, and Urban Policy. "The reversal includes jurisdictions of every size and type."

Percentage of Michigan jurisdictions better vs. less able to meet their financial needs. 

Overall, 45 percent of jurisdictions report no significant change in their fiscal health from last year. Particularly concerning is that among county governments, 19 percent rate their fiscal stress as high, up from 3 percent in 2015, Ivacko said.

The poll, part of the Michigan Public Policy Survey series at CLOSUP, reports:

  • Fewer local governments report property tax revenues are increasing and more report state aid is decreasing.
  • Nearly half of officials predict their community will have good times financially in the coming year, but just 28 percent believe their jurisdiction will be better able to meet its fiscal needs next year, down from 36 percent in 2015.

The study, conducted April 4-June 6, 2016, involved surveys sent via hardcopy and the internet to top elected and appointed officials in all counties, cities, villages and townships in Michigan. A total of 1,378 jurisdictions returned valid surveys, resulting in a 74-percent response rate. The survey had a margin of error of 1.3 percentage points.

--Michigan News release by Greta Guest, 734-936-7821, [email protected]. U-M has a satellite uplink TV studio and an ISDN radio line for interviews.