Troy City Government is going BANKRUPT by 2016.

[Parkguy]

Financing cities via a capped property tax [[as in Michigan) means that they are always in peril once they are built out. Infrastructure ages and has higher maintenance costs. If there is inflation, property taxes don't keep up. If there isn't, property values fall as the buildings age. The only situation that works is lots of turnover [[to reset the cap), and property inflating faster than the general price level, and I think that story is over for the next couple of decades. Expect more municipal distress unless the state is willing and able to cough up more money for local government.

You've got it exactly right. And around here, all of the growth since the first oil embargo has been an illusion. There was no significant growth in population in the region-- it just shifted. It has all been growth on the fringes at the expense of Detroit, but now we are beginning to see that this pattern will ultimately come down hard on everyone, city and suburban alike. The developers who drove the push to ever-greener fields are long gone, leaving the legacy costs behind. And frankly, I think Headlee was a big mistake. I have been in my house over 30 years, so I certainly benefit from limits on property tax increased, but I believe that it sets up an artificial incentive for people to stay in the same home beyond the time they normally would. This leads to gray-haired enclaves where houses aren't rehabbed, repairs aren't made, and local businesses dry up from reduced local spending. Then, housing doesn't turn over to new buyers for "starter homes." Schools close because of fewer young kids, and new schools have to be built in the far suburbs because that is the only place young families can afford housing. Roads, sewers, water, power, fire services, etc.-- all have to be rebuilt in new places while perfectly usable [[or good for renovation) infrastructure sits unused and crumbling. And then we pile on layer after layer of replicated organizational costs every 10 years when a new wave of sprawl starts it all over again. End of rant.

[Detroitej72]

I find it hard to believe that Troy is the next Highland Park. Given that they have a huge office, retail and industrial base, they would probably be among the last Michigan cities to suffer from changes in residential composition [[and I don't even think that's remotely true).

If they keep giving huge tax subsidies to keep companies like Kelly Services, and keep the tax burden on their residential base, with these falling housing values it certainly could happen. That's the problem with corporate welfare.

[douglasm]

Mikey.....
.....the problem is not if you use federal funds, but how. We didn't use the stimulus funds to prop up our budget like some cities did, we used it to build the new sewer system. One local jurisdiction had state and federal funds available to build a roundabout at a main intersection. They didn't want it, so they turned it down.

Those cities who used funding to sustain a budget that was unsustainable, that's their problem. But grant funding when used correctly is a wonderful thing for smaller municipalities.

RO Resident.....
......thanks for the info. I had forgotten that in Michigan.....and I assume it's still the law......local income taxes are an option. Memory says that when I worked in Detroit, they took a share, and Ferndale [[where I lived) got a cut. I do very much think, though, that a capped city sales tax is an option that should be considered. We're probably going to have to go that route [[in Washington, it's an option....we have no income tax) to help finance our contract with the county for police services.

[Cincinnati_Kid]

A lot of this is also tied with Lansing trashing personal property tax. If an alternative tax source isn't made to replace Personal Property you will see many Cities with EMF come 2014-2016 and some will probably file bankruptcy and may even dissolve.

With the Changes in Personal Property Tax Cities and School need other options for funding. How you go about raising that revenue is another thing. The way sales tax is distributed to communities also needs a major overhaul but Lansing isn't going to do that. It would need to be a constitutional amendment.

Your BOY Snyder runs state government like he ran Gateway Computers, and how did that work out?

[Mipade]

I've worked in Troy for almost 15 yrs and it's a ghost town compared to a decade ago.
I view Troy as one of the most pro-business communities around the metro area and if austerity doesn't work for them why would it work anywhere else?

[Bham1982]

I've worked in Troy for almost 15 yrs and it's a ghost town compared to a decade ago.

Right, Troy is a ghost town even though its population has grown considerably over the last 15 years, and has established the most desirable shopping complex in the Midwest.

And, let me guess, Detroit is a boomtown in spite of the massive concurrent population and business losses?

[BrushStart]

Right, Troy is a ghost town even though its population has grown considerably over the last 15 years, and has established the most desirable shopping complex in the Midwest.

And, let me guess, Detroit is a boomtown in spite of the massive concurrent population and business losses?

Such a predicatbale troll.. You will go to no end to defend your fanaticism with sprawl. The conversation here isn't about the city of Detroit, it's about the city of Troy, a posterchild for suburban Oakland County. Why can't you admit when you are wrong? Your nauseating one-sidedness damns your credibility to hell.

[Bham1982]

Such a predicatbale troll.. You will go to no end to defend your fanaticism with sprawl.

LOL.

If you think I'm a "fanatical troll" because I happen to cite official Census data when someone else claims Troy has become a ghost town, so be it.

You obviously have no use for peer reviewed research or government sanctioned data. It's obviously all lies, promulgated by "fanatical trolls".

[Jimaz]

I've worked in Troy for almost 15 yrs and it's a ghost town compared to a decade ago.
I view Troy as one of the most pro-business communities around the metro area and if austerity doesn't work for them why would it work anywhere else?

I suspect austerity would work very well on Wall Street. Doubt that's going to happen without radical reforms though. Corruption, tolerated, grows.

[jerrytimes]

Typical 'Detroiters' here, happy to see a suburban city like Troy file bankruptcy, just like Detroit! What is wrong with you people? Number one, IF Troy files for bankruptcy in 2016, it's nothing like what Detroit is going through. Detroit has been hacking and slashing services and cops and firefighters for more than a Decade. Troy is still yet to do this. Detroit can't even keep the street lights on for Christ sake! Yet, this makes you happy. What is wrong with you?

And to Mark Smiles, so you're mad that they have cops that give you seat belt tickets? So is the alternative better, not having enough cops on duty to even respond to a traffic accident?

[Gistok]

Geeze.... I don't usually agree with Bham1982 or jerrytimes... but they're both spot on.... Detroit's fiscal mess doesn't mean that schadenfreude should be the order of the day...

Danny posts his sensational "5 PM News" type of thread title... and some here are already almost apoplectic with glee 3 years too early... Troy is undergoing what most every city in Michigan is undergoing... nothing more... nothing less...

Let's keep that in mind...

I'd say revisit this subject in 2 years... and we're likely then to say "much ado about nothing"...

[Det_ard]

Quite the alarmist thread, virtually devoid of facts.

From a quick read of Troy's most recent budget:

Annual Budget: ~$130 million
Fund surplus: $17 million
Fund surplus will be depleted in 5 years due to excess of spending over revenue
Average annual fund surplus decrease = $17 million/5 = $3.4 million/year
Troy's property tax revenue per mill: $4.26 million

So, raise taxes by 0.8 mills, and the fund surplus will stay at $17 million. Or cut spending and raise taxes by some combination that equals $3.4 million per year.

FYI, the SMART millage is 0.59 mills. If Troy dropped out and put that money toward their city's budget, they'd only need to cut spending by $890K per year and their budget would balance. Not that they'd do that, they know it would piss off six people on DYes.

Does the fact that Troy is projected to spend 2.6% more than they take in really justify the alarmist tone, and talk of bankruptcy, EFMs and general civic collapse? Hell no. Metaphorically speaking, they just need to cancel cable, or sell a few vintage concert tickets on Ebay.

[iheartthed]

I'd say revisit this subject in 2 years... and we're likely then to say "much ado about nothing"...

I wouldn't be so sure about that. Troy may avert bankruptcy but it will probably be more than "much ado about nothing."

[poobert]

Danny posts his sensational "5 PM News" type of thread title... and some here are already almost apoplectic with glee 3 years too early... Troy is undergoing what most every city in Michigan is undergoing... nothing more... nothing less...

True, and Troy will never, in our lifetimes, anyway, become Highland Park. However basically the only redeeming feature of all of our suburbs - and for Troy this is more true than most - was their outstanding city services. Schools were great. If someone so much as farted they'd get a blight ticket. Crime was nonexistent because hoards of police officers had nothing to do. Parks could be mowed and doused in DDT multiple times a day. The suburbs could jump and shout that they were everything Detroit isn't. As you can see from this thread, which initially had nothing to do with Detroit, they still fall back on that as a Hail Mary.

Fact: the money for all those gold-plated services isn't there anymore. Even the fanatical Oakland County martyrs [[you know who they B'are) here have admitted that.

So the question remains: what on God's green earth does a place like Troy have to offer, then???

Troy isn't going to be the new Brighmoor. However expect things akin to the now notorious title "south Warren" to creep into everyday conversation. Remember a place like that used to be the anti-Detroit suburban paradise, as well.

[Novine]

Bham1982 forgot to mention that going by the Census, Troy's best days are behind it. The population was 80,959 in 2000. In 2010, it was 80,980. We've seen how this plays out in Southfield, Warren, etc. Once a suburban sprawl community hits its population peak, what follow is a slow decline of population loss coupled with declines in property values. Maybe Troy will be the community that escapes that pattern but the history doesn't look good for it.

[DTWflyer]

I grew up in Troy, and surprisingly Troy does have a lot to offer.

Despite the bias this message board has, not everyone desires to live in the city or an urban environment. Some people actually do want to live in a suburban environment, surprise, surprise.

Troy's assets are its schools, services, parks, shopping, and proximity.
A lot of people who work in Detroit, Warren, or Auburn Hills live in Troy. You see a lot of two-income families where one may work downtown and the other may work in Auburn Hills. Troy has good access to all of the major business communities in the region.

Plus, it is probably the closet suburb to the city where you can start to find housing on larger lots. Believe it or not, some people like to live on larger pieces of property.

The part about Troy is that is has a strong appeal to the international community. A lot of ethic groups are established in Troy, and the community is actually well-known as a place that is friendly to the international community.

[D_Town]

Speaking of Southfield...how are their city finances? I heard they actually are doing better than Troy

[poobert]

Troy's assets are its schools, services, parks, shopping, and proximity.

The first three are dependent on brimming coffers, which Troy no longer has nor will it have. You conveniently ignore that.

So that leaves "shopping" and "proximity". In Metro Detroit, that means "malls" and "freeways". Which nearly EVERY other suburban community has.

So then we come back to the tired old shtick of "NOT EVERYONE WANTS UBRAN LIVING!!!111" Okay, yeah, of course. Except it's not like it's a choice between Troy or Manhattan. In fact you're far more hard-pressed to find anything close to urban living in Metro Detroit than you are to find something like Troy. For all intents and purposes, it's indistinguishable from most other suburbs in the region. And this isn't New York City. Virtually everyone outside of Hamtramck and Midtown have a substantial yard.

And finally...yeah, Janice Daniels seems so welcoming to outsiders. What an open and friendly message she sends to the world.

If Troy had stock and I were a shareholder, I'd be sell everything right now.

[Wesley Mouch]

You've got it exactly right. And around here, all of the growth since the first oil embargo has been an illusion. There was no significant growth in population in the region-- it just shifted. It has all been growth on the fringes at the expense of Detroit, but now we are beginning to see that this pattern will ultimately come down hard on everyone, city and suburban alike. The developers who drove the push to ever-greener fields are long gone, leaving the legacy costs behind. And frankly, I think Headlee was a big mistake. I have been in my house over 30 years, so I certainly benefit from limits on property tax increased, but I believe that it sets up an artificial incentive for people to stay in the same home beyond the time they normally would. This leads to gray-haired enclaves where houses aren't rehabbed, repairs aren't made, and local businesses dry up from reduced local spending. Then, housing doesn't turn over to new buyers for "starter homes." Schools close because of fewer young kids, and new schools have to be built in the far suburbs because that is the only place young families can afford housing. Roads, sewers, water, power, fire services, etc.-- all have to be rebuilt in new places while perfectly usable [[or good for renovation) infrastructure sits unused and crumbling. And then we pile on layer after layer of replicated organizational costs every 10 years when a new wave of sprawl starts it all over again. End of rant.

Great post. The organizational costs piling that never get adjusted downward and just keep 'piling up' is a great point that isn't often made.

Regarding Headlee, your point is also really important. The unintended consequences of regulation sometimes don't manifest themselves quickly, but they always do come out.

[Bham1982]

The first three are dependent on brimming coffers, which Troy no longer has nor will it have. You conveniently ignore that.

The comparison is relative, not absolute. How does Troy have [[on a relative level) decreased level of services compared to other Metro area cities?

If anything, there would be a flight to quality in tough times, and Troy's excellent services would be highlighted compared to the deterioration in Detroit and other declining communities

So that leaves "shopping" and "proximity". In Metro Detroit, that means "malls" and "freeways". Which nearly EVERY other suburban community has.

No city in Michigan has comparable shopping or freeways. Somerset has no competition, and I-75 has the highest traffic counts.

[Gistok]

Bham1982 forgot to mention that going by the Census, Troy's best days are behind it. The population was 80,959 in 2000. In 2010, it was 80,980. We've seen how this plays out in Southfield, Warren, etc. Once a suburban sprawl community hits its population peak, what follow is a slow decline of population loss coupled with declines in property values. Maybe Troy will be the community that escapes that pattern but the history doesn't look good for it.

80,959 and 80,980.... hmmmm... considering the downsizing of the metro area and the mortgage meltdown... just how is this number significant?

If anything Troy has managed to beat the odds in metro Detroit....

I will say this... no wonder this region will take a long time to amount to anything... just look at the mindsets on this thread...

[Cincinnati_Kid]

Speaking of Southfield...how are their city finances? I heard they actually are doing better than Troy

I don't haven't heard about the city finances, but I do know Southfield has some of the highest property taxes in Oakland County, even higher than Birmingham which is hard to believe.

[Anonymous]

80,959 and 80,980.... hmmmm... considering the downsizing of the metro area and the mortgage meltdown... just how is this number significant?

If anything Troy has managed to beat the odds in metro Detroit....

I will say this... no wonder this region will take a long time to amount to anything... just look at the mindsets on this thread...

Not picking on you, but you're just the most recent relevant post.

Troy can see stagnancy in its population, as the census numbers show, but lose lots of business.

In this sense, the guy that has worked there for 15 years may, correctly, characterize it as a ghost town in the context in which he experiences it, particularly if he commutes in and only sees a commercial/industrial area.

This would also, possibly, add another piece [[to declining prop values) to the "why is population stable but finances are getting worse?"

[DTFellow]

Not everything related to cities and neighborhoods breaks down nicely into statistical data. While the census numbers are useful, they don't take into consideration many of the nuances and subjective aspects of places. If Troy doesn't feel as bustling or as booming as it once was, even if the statistics say differently, it still doesn't feel that way subjectively. As much as we on this board might like to think that people are logical, the large proportion of humankind allow these cognitive biases and impressions color the statistical reality of a situation.

Long post simplified: If Troy feels like its stagnating, it likely is, no matter what the statistics say, and the whole metro area should be concerned. Where will we put the deck chairs next?!

[iheartthed]

80,959 and 80,980.... hmmmm... considering the downsizing of the metro area and the mortgage meltdown... just how is this number significant?

If anything Troy has managed to beat the odds in metro Detroit....

I will say this... no wonder this region will take a long time to amount to anything... just look at the mindsets on this thread...

The entire metro area lost population but the losses were not shared equally. The inner city, aging inner ring burbs, and built out suburbs lost population or had stagnant population. The new sprawlburbs posted double digit increases. If I were Troy this is the part of the story where I'd go... Pause.