Few people pick where they want to live because of low taxes.
They pick a place because it offers the things that matter to them. But in Michigan, we remain anchored to a decades-old funding model that does not direct revenue in a way that will invest in the things that really matter. Make no mistake, businesses value talent above all else and if we can attract and retain the talent, the businesses will follow.
The research supports community-based placemaking strategies as a way to strengthen both our economic and social future. Walkable urban places command a premium of over $20 a square foot, generate 10 times the tax revenue, and maintain higher values during recessionary times. Property values are typically 5 percent higher when homes are located near parks. Investments in the arts create jobs. Transit and multimodal infrastructure are correlated with increased jobs and wages. It is time to begin investing in Michigan’s future, and Michigan’s future is in its communities.
To grow and prosper, we must invest our resources in a way that will foster that growth. This holds true for individuals, businesses, and governments.
In Michigan we have endured some of the most heinous examples in the country of what disinvestment can bring. Our largest city was forced into bankruptcy. A former industrial hub is dealing with the most significant human and infrastructure crisis in memory, and many other communities were forced into emergency management as the solution to “their” problem. The popular answer is we aren’t living within our means, or mismanagement, or some other self-inflicted ailment. The real answer is arguably worse.
This is all the result of Michigan’s systematic disinvestment in local government. With the new budget proposal, we now stand at over $7 billion in revenue having been diverted from cities, villages, townships and counties to fund state government.
These are dollars that should have flowed to your hometown and mine to provide services that help foster better places to live. We previously raised the impacts of disinvestment in “the Great Revenue Sharing Heist” article. First published in the Michigan Municipal League’s Review magazine, it laid out the difference those dollars would have made to our in a number of core cities.
Believe it or not Michigan is the only state in the country that reduced total funding for municipal government from 2002-2012. Our state is investing less in creating strong communities than it did in 2002. We are 50th in the nation in local funding, and every other state has increased their total funding levels during that time. The 49th state, Ohio, has increased total municipal funding by over 25 percent. The average increase nationwide is nearly 50 percent, but Michigan is down almost 9 percent in total and the state’s investment in communities is down over 56 percent.
In spite of a strong economy, the proposed state budget is another in a long line that fails to make strategic investments that promote strong communities. This strategic choice fails to recognize the enormous role that cities play in our economy, and more importantly in our daily lives.
We need great cities that will enable Michigan to attract and retain talent, because in 2016, that is what truly drives prosperity. This budget simply does not recognize that strong vibrant communities are necessary to drive a strong economy and every year that we continue on this course we lose ground. Attractive business taxes mean nothing without great places to attract those businesses to.
Michigan needs to rethink its priorities and begin investing where the greatest return exists, and that is locally. This budget provides no increase in statutory revenue sharing, even though projected sales tax collections are up. This is currently the only significant discretionary money from the state’s general fund that flows to Michigan communities. If we truly want a great Michigan, then we must commit to a strategy of investing in what really matters: our communities.