MSU Extension Center for Local Government Finance & Policy

The City of Detroit’s Fiscal Year (FY) 2013 budget, beginning on July 1, 2012, marks a period of significant restructuring to restore financial stability. The Mayor presented a recommended budget to the City Council in April 2012 that eliminated 2,500 positions and reduced costs by $250 million to align revenues with expenditures and make progress toward eliminating a significant general fund deficit. At the end of May 2012, the Council approved a budget with amendments to the Mayor’s recommended budget, which he accepted. Despite the difficult decisions made during the budget process, the real challenge is now just beginning: successfully carrying out the budget plan.

This Question and Answer document explores issues that directly affect residents and taxpayers. A larger audience is interested as well. Detroit is representative of many older, industrial cities that have lost population and tax base while supporting a government organization and infrastructure built by previous generations. Detroit’s successes and setbacks will provide important lessons for municipal leaders who are balancing fiscal constraints with providing reliable, quality services.