U.S. Cities in Bad Shape Now, But 80% Say Next Year Likely to be Even Worse

Mayors from across the nation anticipate their cities will be in worse financial shape next year as sales tax revenue, revenue from service fees, and property tax revenues all are expected to decline. Findings from the U.S. Conference of Mayors survey indicate that while two out of three mayors expect budget shortfalls this year, four out of five are projecting shortfalls in their next fiscal year and those shortfalls are expected to be the same or larger than this year’s experiences.

More than half of the 158 mayors surveyed say that despite the funding provided through the American Recovery and Reinvestment Act, the current budget situation has affected their ability to engage in job-creating projects. Moreover, the U.S. Conference of Mayors and IHS Global Insight project job losses will continue into 2010 and will not regain their 2007 peak until late 2012. The most common actions being taken by cities to avoid budget shortfalls this year include postponing projects or initiatives (81 percent), eliminating city positions through attrition (75 percent), and reducing purchasing and procurement (73 percent).

The full survey is available at: http://www.usmayors.org/pressreleases/uploads/SurveyonCityFiscalConditions11709.pdf