Municipalities' Fiscal Outlook Is Gloomy Despite Economy

LANSING, Mich. (AP) - Eight years into Michigan's economic recovery, the fiscal outlook is still unnerving for municipalities seen as ill-equipped to withstand the next recession.

Despite continued job growth and record auto sales, the state's per-capita personal income lags the national average after a long-lasting downturn. Taxable values of property are below peak levels in 85 percent of municipalities. And their state aid is down 20 percent from 15 years ago.

The circumstances are alarming Business Leaders for Michigan, a group of executives at the state's largest companies and universities. It wants the Republican-led Legislature to do more such as addressing public retiree liabilities.

Municipal officials and Democrats say cities' problems extend well beyond legacy costs and there has been little discussion about other factors such as tax limitations and revenue-sharing cuts.
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