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fiscal health

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News

Fiscal health: Mixed signals for Michigan’s local governments

Dec 11, 2019
ANN ARBOR—More than two-thirds of Michigan’s local government leaders rate their jurisdictions’ current fiscal stress as relatively low, according to a new survey by the University of Michigan’s Center for Local, State, and Urban Policy. On the...
State & Hill

CLOSUP’s Michigan Public Policy Survey turns 10

Nov 14, 2019
It’s been a tumultuous decade in Michigan: three governors, a cratered economy and its recovery, the largest municipal bankruptcy in U.S. history, a public health disaster in Flint, and more. Through it all, the Michigan Public Policy Survey...
CFLP Blue Bag Lunches

Local Government Fiscal Health: Do subjective self-assessments match "the numbers"?

Mar 14, 2019, 12:00-1:00 pm EDT
Jeffries Hall Room 0220
Local government fiscal health is typically assessed using objective financial indicators, but little is understood about how local officials subjectively understand their own fiscal health. We compare self-assessment data from the Michigan Public Policy Survey with financial data on Michigan local governments to explore the extent to which self-assessments align with conventional financial indicators. Qualitative results reveal that local officials emphasize long-term spending pressures (e.g. roads, infrastructure) and external factors, such as uncertainty around property values and state aid (i.e. revenue sharing) payments, when assessing their fiscal health. Quantitative results provide some corroborating evidence, but in general, conventional indicators are not powerful predictors of self-assessments, especially for high-stress governments. We believe that part of the disparity is that financial indicators do a poor job of capturing what local officials say they are most worried about. We suggest that self-assessments may be a useful supplement to conventional measures in capturing “true” fiscal health.