Over the next few days we’re going to hear a lot about Michigan, the comeback state.  About how, after over a decade of economic decline, our state is on the rebound, retaining and attracting small and large companies, and creating jobs.  We’ll hear about how we have a $500 million rainy day fund and a projected surplus of nearly $1 billion. And we’ll hear a lot about how this was achieved by an administration that has received accolades across the country for their financial wizardry at getting it done.  Yes, there will be lots of hand shaking, back slapping and a general declaration of victory.

Of course there are always two sides to any story and the other side of this one provides a stark contrast in reality. For instance, ask economists of any particular stripe and they’ll tell you that Michigan’s economic recovery has largely been accomplished on the foundation of the auto bailout.  And the dirty little secret is that it’s also been accomplished by the shift and shaft budget prowess of those who make such decisions, moving money away from various areas like funding local government services, education, and other services to fill budget gaps and fulfill other priorities. And that all comes at a price.

The reality at the local level is the one I’d like to focus on for a moment. I’ve heard it said time and again that all local government officials and administrators need to do is share services more, get a handle on pension costs, and forecast and plan better.  That’s tough to do when the partnership between state and local governments to provide local services has been broken. Over the past 12 years, payments to local governments have been slashed by a cumulative amount of $6 billion. That’s right $6 billion. Couple that with the loss in property tax revenue that communities are still recovering from due to the financial crash of a few years ago, along with the fact that our state limits the ability of locals to raise their own money, and the picture becomes more complicated.

The reality is that our municipal finance system, or that system which funds local services, has been broken for some time.  And while there will be those declaring victory, the fact is that there are more local units on the state Department of Treasury fiscal distress watch list than at any other time in this state’s history. People can blame local officials for that all they want, but it’s only because of the work by local officials that there aren’t more communities in bankruptcy.

So before we go about declaring victory, let’s remember there is still a lot of work to do to ensure Michigan’s economic recovery is long-term and sustainable and not just made into a platform for term-limited politicians seeking to declare their legacy as having fixed the place.

I had the opportunity to attend the recent national meeting of CEOs for Cities. This is one of the first organizations I came into contact with as we began exploring new and innovative strategies being used to create economic prosperity in communities across the county and the world.  Its annual meetings have always been a great way to meet people involved in economic development, non-profit work, foundations and local government among others and network, learn and steal ideas.

While the focus of the meeting was on collaboration, one of the recurring themes from speakers was that city leaders are on their own when it comes to working to make their communities better places.  Certainly, we should expect little or no help from the federal government. Even when they get their act back together, the fact is that federal resources will increasingly be directed toward mandatory spending, squeezing out discretionary program spending such as CDBG that communities have used to improve quality of life.

So let me repeat what I heard in the strongest possible terms.  First from Bruce Katz of the Brookings Institution who noted that power and responsibility for getting things done is clearly being forced down to city leaders and those finding success understand that the restructured economy relies on innovation and creativity. Furthermore, they also understand that cities are made up of not just governments but networks, and successful networks build upon their unique assets. Most importantly however is the fact that metros thrive only when their cores thrive.

Anil Menon, President of Cisco Smart+Connected Communities, followed the next day by telling people that the answers to creating wealth and prosperity lies within our cities. That there is not time waste in “waiting till later” and that cities cannot continue to address issues in silos. If you look at your city and say this is not what I would build today, you need to start over. And, while its fine to act locally, you better have a global focus.

The next several years will continue to be disruptive and full of change. We need to be spending our time, energy and resources on what counts…developing our assets and getting about the business of building our economy.

The Governor Snyder administration has announced a new regional initiative. Dubbed “Regional Prosperity Initiative” the effort is meant to better coordinate service delivery and strengthen local economies through greater regional collaboration.

The initiative, first unveiled in the Governor’s 2014 budget request, is making $2.5 million through a competitive grant process for existing state-designated planning regions and Metropolitan Planning Organizations. The goal is to empower local and regional partners to develop a consensus vision and implementation plan for economic success.

According to a press release, all state government departments will begin serving 10 regions across the state, enhancing service delivery and encouraging communities to collaborate on a regional basis. The new regional map supports the governor’s vision that economic development must be viewed as a system that encompasses and coordinates talent and infrastructure along with traditional economic development strategies.

For more information visit www.michigan.gov/regionalprosperity

Arnold Weinfeld is Director of Strategic Initiatives for the Michigan Municipal League. He can be reached at 517-908-0304 or at aweinfeld@mml.org

Since beginning work at the MML some 8 years ago, I have always marked the official start of summer by the annual trip to visit members in the Upper Peninsula through our Region 7 meeting.  Always an anticipated event not just because of the opportunity to enjoy the beauty of the UP and the hospitality of local officials in the region, but also because it means a road trip with colleagues and an opportunity to relive such events of years gone by.

This year was no different as we rolled our way across the bridge to Bessemer in the far western UP.  Ten hours in a car with family, let alone co-workers, is a challenge at any point in time, but this year was made easier by the outstanding weather, scenery and of course the company.

And as is the case with any of the League’s meetings, there was a lot of listening and learning from each other and presenters. I was even given the opportunity to present on the League’s place-based strategies with a focus on the MIPlace Partnership Initiative. However, what I hoped would be an uplifting session was in the end as challenging as any I’ve given, having forgotten the golden rule of presentations…know thy audience.

It hit me during the question and answers session. A councilman spoke to thank me for the session, since it made clear for him that he did not want his community becoming anything like those I had spoken of. Having lived in larger communities downstate, he was now very satisfied being in a small town that offered amenities more in tune with a family lifestyle than with that of attracting a young and talented workforce.

As we talked, I noted that at the end of the day it is up to the local community and its leaders to figure out who they are and what they want to be.  And as I thought about our discussion later and talked with colleagues, I realized that what I should have been focusing on was the larger picture of what it means in 21^st century terms for local officials to provide a high “quality of  life”.

You see, my presentation focused on the latest demographics and market research showing the groups prevalent today and what they’re looking for in a community.  And while that is all well and good, what got lost in translation is the fact that the amenities the two largest groups in society today (young people and empty nest baby boomers) are looking for relate back to quality of life not just for them but for all of us.

Attributes such as walkable downtowns and neighborhoods, quality public spaces such as parks, different housing options including mixed-use commercial residential in our downtowns, and transportation options like bike lanes are all part of a broader package of qualities that work to make a community vibrant and resilient, whether you are looking to attract young professionals, families, retirees or all three groups.

This has always been the point of the League’s emphasis on “place” and we are finding it to be true time and again as we uncover successes across the state in communities big and small, urban, rural and suburban.  If nothing else, our trip not only again confirmed how geographically large and diverse our state is, it also confirmed that each and every community across the state has something to offer toward providing a high quality of life for residents and visitors alike.

 Typically I like to write posts that celebrate the good things going on in communities across the State of Michigan. This serves to present a different dialogue and change the conversation from the usual norm. It is an honest effort to showcase the efforts of local leaders, from public officials, to those in business and non-profit as well as caring and thoughtful residents and neighborhood activists. But it is not meant to gloss over the challenges facing folks such as these and our communities in general. So without further delay, it is time for a reality check.

I have heard it said many times in many places over the last couple of months that Michigan is coming out of its recession. This is due to a number of factors, from the federal bailout of the auto industry to aggressive and sometimes controversial actions at the state level as well as efforts at the local level. As is usually the case it is never any one thing.

But despite all the talk about Michigan’s economic recovery there is no amount of relentless, positive action that can disguise the fact that many of our communities, large and small, still face, and without immediate policy changes will continue to face, fiscal distress.

We are all too familiar with the financial troubles besetting Detroit. However, a recent article in the on-line publication, the Bridge, brings to light the financial issues facing other cities across Michigan. And these are communities that are generally considered to be well run.

The article features a study by a private sector firm, Munetrix, which found dozens of communities around the state, from SE Michigan to SW Michigan and Northern Michigan facing financial stress.

Examples include Kalamazoo, which I had the opportunity to visit not too long ago. I was told by local officials and city staff that deep cuts to the budget will continue without some changes and as the article points out they are seeking to trim their work force through early retirement. Our state capitol city, Lansing is also facing some tough times as they try to close a $5 million deficit.

As the article notes, and my organization, the Michigan Municipal League has been pointing out for some time; it has been a series of events over the past decade that is taking their toll on local revenues.  This includes lower property values, foreclosures, $6 billion in lost state revenue sharing, limitations of Proposal A and of course the rising costs of pension and health care benefits.

 There is also a second part to this reality check and that is the worsening relationship between the state and local units. As noted above over the past decade, the state (legislatures and governors) has reduced revenue sharing payments by a total of $6 billion in order to shore up other areas of the budget. The new revenue sharing program, known as the “Economic Vitality Incentive Program” has, since its inception two years ago, only become more burdensome and less helpful as local leaders continue to do all they can to collaborate with other communities.

And this leads to some thoughts about another article I came across last week, noting that worsening relationships between state and local governments is not just confined to Michigan.

The article, titled “States Power Grab Quashes Local Governments’ Authority” is written by David Morris, director of the Public Goods Initiative at the “Institute for Local Self-Reliance. In it, he notes that Republican governors and legislatures are pre-empting and abolishing the authority of communities to protect their residents’ health and welfare.

• Earlier this year Wisconsin passed a law eliminating the authority of cities, villages and counties to require public employees to live inside city limits. Michigan banned local residency requirements for police and fire employees many years ago.
• A few weeks ago Kansas enacted a law prohibiting cities, counties and local government units from requiring private firms that contract with them to pay more than the state minimum wage or to require other benefits and leave policies.
• The Florida House recently voted to pre-empt local governments from enacting “living wage” and “sick time” ordinances. It would overrule counties, like Miami-Dade and Broward, which require companies they contract with to pay wages higher than the federal minimum wage.
• In November 2010, Pittsburgh became the first U.S. city to ban fracking within city limits.  In February 2012, the Pennsylvania legislature passed a law allowing fracking in all parts of the city, in essence abrogating cities’ traditional zoning powers to protect against noise, odors and industrial dangers.
• 19 states (including Michigan) severely restrict or abolish the right of local governments to build their telecommunications networks.

Now I don’t know about you, but I am fascinated to learn that these actions are occurring in Republican states.  And while it is true that over the course of our country’s history court cases have made it clear that municipalities are creatures of the state, it is also true that there has been much said, a lot of it critical, about the federalist nature of our system of government. And with over 300 million people now part of our great nation, it is hard to argue that some form of consistency is needed.

But, consistency in thought and action is also needed from those who argue against federalism in terms of the relationship between states and local governments.  In Michigan, time is of the essence. Local communities need a partner, not a parent, to work with them to ensure that quality services are not just maintained but enhanced. At the end of the day, this means resources must be made available through a system of governance and finance that makes sense for the 21^st century.  Without such a platform, the economic momentum we are beginning to gather will surely stall as discerning workers and business will go elsewhere to find the quality of life they say is so important to their well being.

Anyone who recognizes this particular saying will recall it as the refrain from Sargent Joe Friday of the once popular police series, Dragnet.  I title this particular blog in that manner because one of my primary goals these days is to get people to understand the facts about our society and the impact these facts have on public policy decision making.  

Having attended the recent AARP “Aging in Place” conference (which the Michigan Municipal League and others co-sponsored), the message and strategies that my organization and others have been advocating about the need to invest in building vibrant communities was once again affirmed not by political or special interest rhetoric, but by facts. 

Demographic and market research surveys presented by a number of speakers prove out that the trends that were identified several years have not changed. And unless policy makers truly understand what is occurring, they will continue to use scarce resources to make the same bad investments as they have in the past. So here, they are…just the facts.

Census figures continue to show that as compared with the United States as a whole, Michigan has a greater percentage of those aged 65 and older (15% to 13%) and less people in the 18-34 years age bracket (22% to 24%).  Nothing we didn’t already know. But we need to slice into the numbers further to show what is occurring. 

Michigan also has less in the way of younger singles/couples (18% to 24%), less in the way of families (29% to 30%), and more in the way of empty-nesters/retirees (53% to 46%).  Let’s keep digging.  deeper. 

We hear a lot of talk about the need to accommodate families. And yet, census figures show that households with children in Michigan make up barely 32% of our population. And of that number, only 20.4% of Michigan households are those that have a married couple with children.  Let me repeat that, barely one-fifth of our state’s population is married couples with children!  

 If not families, then what is the make-up of Michigan’s 21^st century households. The fact of the matter is that a large majority of Michigan’s population, 61.8%, is made up of one or two-person households. National figures show the same. About one-third of all households across the country are those with children, and that number is project to fall to 25% over the next 20 years. 

So why is it that policy makers concentrate on a picture of society from the “Leave it to Beaver” days? 

Overall the demographics are clear, the two largest groups in American society today are baby boomers (born between 1946 and 1964) and millennials (born between 1977 and 1996).  But perhaps, the interesting piece of this puzzle is that those baby boomers and the millennials have provided the same answers time and again as to what they’re looking for in a community.  And, it comes down to affordable housing, transportation options, safe/walkable streets, open spaces and parks, convenient shopping and services and cultural amenities.

 We don’t have much time folks. Other states are well aware of these trends as well and many have taken or are taking actions to work with leaders in the public, private and non-profit sectors to invest in building communities for all ages, not just any one particular demographic. We need to get to busy.

For more information check out:

MML Center for 21st Century Communities

AARP Public Institute for Livable Communities

MIPlace Partnership Initiative

Michigan Office of Services to the Aging Community for a Lifetime

Here is a great article about residential development in Lansing that again reflects where the housing market is headed as we get deeper into the 21st century.

Now I’m going to say that I and my colleagues at the MML “told you so”, but we have been telling whoever will listen that prosperous communities of this century look and feel far different than those of the last century.

In order to understand why, you have to understand demographics and the market shifts that are occuring. Such knowledge has been central to our message about the use of place-based strategies through mechanisms like the League’s “Center for 21st Century Communities.”

How many more of these kinds of articles are necessary before policy makers and the broader development/real estate community get it.

Well it’s the start of a new year, and as with any new year it comes with great anticipation of what might be.  And what might be always starts with us as individuals. That is why I was excited to see a series of articles in the Lansing State Journal featuring viewpoints from several individuals who are high on Lansing.  From Chamber Director Tim Daman, continued recognition about the power of talent and young professionals in creating prosperity. Danielle Robinson of Jackson National Life Insurance reminds us about the importance of a strong core city.  She has committed herself and her family to not just working in one, but living there as well. As a matter of fact there are more than half a dozen articles from Lansing area young professionals discussing what brought them here and what keeps them here today. The themes in each are consistent… collaboration, creativity, a diverse economy being built around entrepreneurs and young talent.

Of course, what is happening on the ground in communities often outpaces what some policymakers seem to think is important to creating economic growth. At the state level that has meant a focus on lowering the cost of doing business through changes to tax policy, labor law, and regulations. However, there are many who believe that only by raising earnings will we create prosperity in Michigan.

One of those who take this view is Lou Glazer, co-founder and president of the non-partisan think tank, “Michigan Future”. In a recent interview with Detroit Free Press Deputy Editorial Page Editor, Brian Dickerson, Glazer argued that it is earnings, not business costs that we should be using to measure economic success. And if we want to increase earnings, we need to recruit and keep talent and if we want to do that, Glazer argues that we should be investing in things such as education and cities, two items that have increasingly been found to correlate with keeping talent at home and creating economic prosperity.

As I noted at the start of this piece, a new year brings with it anticipation of what might be.  It does little good if your unemployment rate is among the lowest in the country, but so is your per-capita income and standard of living.  No, if we want to create prosperity we must be about investing. Such programs as the Michigan Municipal League “Center for 21st Century Communities” and the new “MIPlace Initiative” offer much in the way of guideposts,  Policymakers in other states, cities and countries have understood the importance of investing for far longer than we. I do not want to be known as living in “Michissippi”. Its a new year. Its time to get to work.

Over the course of one week I had the opportunity to visit two of Michigan’s urban centers, Battle Creek and Pontiac. Once again, I found in both communities passionate people working to use their assets and create prosperity anew in their downtowns and neighborhoods.

Both downtowns have great bones for future development. In Battle Creek I visited with the mayor and economic development officials and was also able to sit in on the first meeting of a new community engagement project being funded by Kellogg Foundation and led by the local United Way. City and community leaders are ready to continue the work that has been started, including an $85 million project to revitalize downtown, a new math and science center that will draw youth, affirming that BC will be the center for Kellogg Company global research operations and development of a national center for food protection. An intense effort is underway to attract residential development to the downtown and there is more than one property waiting.

Pontiac was no less enthusiastic about their future.  New loft developments in the downtown are ready and the private and public sector are working together to make the city the vibrant urban core of Oakland County.  The regional chamber of commerce is providing the catalyzing platform for bringing folks together.  And with a large hospital as an anchor in the downtown the eds and meds strategy is one that might just serve Pontiac well moving into the future.

My visits to these two cities again affirmed for me that there are good things going on in communities across our state. And it really doesn’t make a difference where I go, the key to bringing new dreams to fruition lies in the ability of both public, private and non-profit entities to work together and engage the greater community in their efforts.