The revenue prospects of Michigan city governments are bad and not getting better. That’s the message of the Michigan Municipal League, an advocacy group for cities and townships.
The League points to state tax structure including property tax caps as one problem. But at an MML event on Monday, speakers especially focused on a sharp drop in state revenue in recent years.
MML Associate Executive Director Tony Minghine says revenue sharing with cities dropped 56 percent between 2002 and 2012, even though state revenue grew 29 percent during that that time.
“You don’t have to be a math wizard to figure out those numbers just don’t match up. We are strategically disinvesting in our communities right now,” Minghine says.
Great Lakes Economics Consulting’s Mitch Bean was one of the speakers on Monday. Bean says tax policy combined with the drop in revenue sharing has played a big role in the financial crises in cities like Flint and Detroit.
“The primary cause has been state policy. Now I’m concerned that unless the state addresses municipal finance, this may simply be a preview of coming attractions,” he says.
City of Wayne Mayor Susan Rowe also spoke at the event. Rowe says despite the city’s best efforts, Wayne is projected to run out of money at the end of next year.
“Folks, we are all at risk here. We are all one step away from becoming a Flint and a Detroit. The difference is we started cutting eight years ago in the city of Wayne, but you cannot cut your way out of this,” she says.
The League says it’s launching a campaign to draw attention to the issue.
