Michigan local government officials report improved fiscal health after a year of COVID-19

Largest jurisdictions seeing strongest rebounds, but overall not to pre-pandemic levels

December 16, 2021
Contact: Daniel Rivkin rivkind@umich.edu,
Jeff Karoub jkaroub@umich.edu

Michigan’s local governments report improvement on many fiscal health measures after a year of struggles with the COVID-19 pandemic, but for much of the state the situation has stayed the same or has declined, according to a new Michigan Public Policy Survey report.

Based on spring data, 27% of local governments say they are better able to meet fiscal needs compared with last year, up from 15% in 2020, but still below the 36% saying the same in 2019. Yet, 48% report no change, and 21% say they are currently less able to meet their needs, though that is down from 34% the previous year.

The largest jurisdictions by population size had reported the largest declines in measures of public health at the start of the pandemic, and now report the greatest rebounds, moving from 38% net decline in 2020 to 20% net improvement this year.

The spring 2021 wave of the Michigan Public Policy Survey (MPPS) was conducted April 5-June 7 by the Ford School of Public Policy’s Center for Local, State, and Urban Policy (CLOSUP) at the University of Michigan. It offers a snapshot of most jurisdictions reporting low stress levels overall, and notes rebounds in property tax revenue, and state and federal aid.

“The stresses caused by the public health crisis, economic shutdowns and changes in the labor market took a toll in 2020. Local government leaders have expressed a welcome easing of that stress,” said Tom Ivacko, CLOSUP executive director. “Yet, many indicators show the rebound has not been particularly strong, as many governments say they are simply holding steady.”

“We see some jurisdictions are planning to increase services, including spending on public safety and infrastructure needs, at a much higher rate than last year,” said Debra Horner, CLOSUP project manager. “That reflects a rebound in optimism about the future of their local economies and their own governments’ fiscal capacity.”

The MPPS is a census survey of all 1,856 general purpose local governments in Michigan conducted by CLOSUP since 2009. Respondents include county administrators, board chairs and clerks; city mayors, managers and clerks; village presidents, managers and clerks; and township supervisors, managers and clerks from 1,364 jurisdictions. The survey is conducted with the Michigan Association of Counties, Michigan Municipal League and Michigan Townships Association.