Are City Fiscal Woes Widespread? Are Pensions the Cause?


Summary:

This brief explores the extent to which economic factors, poor fiscal management, and/or high pension costs contribute to the challenges cities with financial problems face. (12/13)

Author(s):
Alicia H. Munnell, Jean-Pierre Aubry, Josh Hurwitz, and Mark Carafelli of the Center for Retirement Research at Boston College
Publication date:
12/13
Filed under:
Research Studies
Key findings:
  • Only a small number of cities overall face serious financial troubles and one-third of them are in California.
  • Pensions are a minor factor in financially troubled cities; fiscal mismanagement tops the list, followed by economic problems.
Download publication:
City_Fiscal_Woes_14-358

Detroit’s bankruptcy and Chicago’s pension problems have prompted a wave of speculation about city finances. What are the facts?

The underlying problems in financially troubled cities have been decades in the making:  population loss, declining tax bases, and other patterns of fiscal mismanagement.

Download supplement: Sketches of cities’ budgetary and economic challenges, based on local or national news media or city fiscal reports