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    August 4, 2022

    A Comparative Analysis of the City of Detroit’s Budget and Staffing

    In a nutshell:

    • The City of Detroit’s budget, including its General Fund budget, is larger than four peer cities of Cleveland, Columbus, Memphis, and Milwaukee.
    • The City of Detroit employs more staff than its four peer cities.
    • The lack of economic wealth held by Detroit’s residents contributes to higher demand for government services and contributes to the relatively large budget and staff. 

    Almost a decade removed from bankruptcy proceedings, the City of Detroit is on a stable financial footing, but a comparison with several peer cities shows that Detroit has budgeted for relatively higher levels of spending and more staff. 

    Detroit’s $2.5 billion FY2023 total budget ($1.2 billion General Fund) took effect on July 1. The budget supports 10,513 full-time positions, a 1.8 percent increase above the FY2022 budget

    Our analysis of the city’s budget prior to adoption utilized historical data to understand how the city’s fiscal plan has changed over time and what challenges may lie ahead. This blog provides a comparative analysis to several peer cities selected based on key economic and fiscal measures. We benchmark Detroit to other peer cities using their FY2022 budgets as a way to better understand how the city appropriates money and staffs its operations.

    Benchmarking is a process by which a government or organization can measure its performance to comparable entities using a variety of factors and indicators. The objective here is to provide a high-level analysis of Detroit’s current fiscal situation. 

    Comparing Peer Cities Using Descriptive Statistics

    Four peer cities similar in size and economic conditions were selected for this comparative analysis: Cleveland, Columbus, Memphis, and Milwaukee. These cities were selected based on five key measures, such as population, land area, population density, median household income, and percentage of the population below poverty level. 

    In a comparative analysis, it is important to identify peer cities that are similar in population. Two important measures of a population are population size and population density, the number of individuals per unit area or volume. Cities serving larger populations often are called upon to provide more services and require larger staff.

    Of the five cities, Columbus has the largest population while Cleveland has the smallest. Detroit’s population ranks in the middle, as does its geographic size.

    Cities covering larger land areas may require larger staffs and more funding to meet the service needs of their constituents. Memphis has the largest geographic area, while Cleveland has the smallest. 

    Similarly, local governments that serve large numbers of people located in close proximity to one another are called upon to provide more services and services at higher intensity levels than local governments that serve sparsely populated areas. Milwaukee is the most densely populated city in the sample with Memphis ranking last. Detroit’s population density falls in the middle of the pack ranking. 

    Economic indicators such as median household income and percentage of the population below poverty level provide glimpses of the needs within a population. Populations with lower household median income levels and higher poverty levels often have a higher demand for public services. 

    Columbus has the highest and Cleveland has the lowest household median income, while Detroit ranks fourth on the list. All of the five peer cities fall below the average household median income in the United States of $67,521. 

    Income level corresponds with the level of poverty in each city. Columbus, for example, has the highest household median income and the lowest percentage of the population living below the poverty level. 

    Detroit has the highest percentage of its population living below poverty level, with Cleveland close behind. The official poverty rate for the United States was 11.4 percent in 2020, of which all five peer cities exceed. 

    Demographic and Economic Indicators For Five Peer Cities 

    CityClevelandColumbusDetroitMemphisMilwaukee
    Population372,624905,748639,111633,104577,222
    Area (sq mi)82.5226142.9304.696.8
    Pop. Density4,5174,0084,4722,0785,962
    Median Income$31,838$54,902$32,498$41,864$43,125
    % Population Below Poverty Level32%19.1%33%24.6%24.6%

    Source: US Census Bureau

    Total Spending and Municipal Employees

    Total fiscal year 2022 city budgets range from $2.3 billion (Detroit) to $1.4 billion (Memphis), while General Fund budgets range from $1.1 billion (Detroit) to $610 million (Milwaukee). 

    Budgets and Staffing in Five Peer Cities, FY2022
    (thousands)

    GF BudgetTotal BudgetTotal Positions by FTE
    Cleveland$647.9$1,783.45,038
    Columbus$1,033.0$1,821.28,673
    Detroit$1,138.4$2,337.910,324
    Memphis$716.0$1,407.47,698
    Milwaukee$610.9$1,756.87,749

    Source: City of Detroit CAFR; City of Cleveland CAFR; City of Columbus CAFR; City of Memphis CAFR; City of Milwaukee CAFR

    Detroit has the largest General Fund and total budget among the five peer cities. This could be attributed to the fact that Detroit has the highest poverty level and has relatively low median household income among the five cities. In addition, it is the second most populated city.  

    The same observations can be drawn when analyzing the number of total positions by full-time equivalent (FTE) employees for each city. Detroit ranks highest for the number of FTEs. The number of FTEs range from 10,324 FTEs (Detroit) to 5,038 FTEs (Cleveland). 

    Comparative Analysis 

    It is important to note that when looking at these numbers, it can be hard to provide an apples-to-apples comparison of city budgets and FTEs because functions and services provided vary from city to city. All cities pay for police, fire and a myriad of other public services but at differing levels. 

    These differences can be overcome by scaling the data using appropriations per capita and staff per 1,000 residents.

    Detroit appropriates the largest amount per capita through its General Fund budget and the second largest amount, behind Cleveland, through its overall city budget. Milwaukee appropriates the least amount per capita through its General Fund and Columbus appropriates the least per capita through its overall city budget.

    Detroit’s General Fund budget and total budget are both relatively large compared to these peer cities. One of the main reasons for this could be due to the appropriations the city makes to provide its residents with services that are necessary to ensure a greater quality of life. Detroit struggles with high poverty levels and low median household income, which creates a higher demand for public services.

    Another reason for the city’s budget size could be attributed to the unique menu of services it provides that its peer cities do not. For example, Detroit is the only city in the sample that runs its own bus system which adds to cost. 

    Detroit also has an expansive demolition program managed through a designated Demolition Department within the city. With a large geographic area and a spread out population, the city is tasked with maintaining and supporting a city that was once built to service a population of two million people.

    The large exodus of the population over a seven decade period brings abandonment and blight throughout large parts of the city. Population decreases but geography and infrastructure do not. Thus, the city must appropriate more money to departments and personnel to service the maintenance and revival of struggling parts of the city to service its residents. This can be seen when comparing the number of staff per 1,000 residents. Detroit budgets for more staff positions than any other peer city in the sample.

    Comparative Budgets and Staffing Among Peer Cities, FY2022

    General Fund Appropriations Per CapitaTotal Budget Appropriations Per CapitaStaff Per 1,000 Residents
    Cleveland$1,739$4,78613.5
    Columbus$1,140$2,0119.6
    Detroit$1,781$3,65816.2
    Memphis$1,131$2,22312.2
    Milwaukee$1,058$3,04413.4

    Source: City of Detroit CAFR; City of Cleveland CAFR; City of Columbus CAFR; City of Memphis CAFR; City of Milwaukee CAFR

    Columbus is the most populated city and has the fewest staff per 1,000 residents (9.6 FTE). Columbus’ per-capita appropriations also rank low indicating the city is not spending as much as other cities. Detroit is the second most populated city with the highest staff per 1,000 residents ratio. Cleveland has the lowest population and the second to highest staff ratio behind Detroit. 

    Both Detroit and Cleveland rank low for household median income and rank high for poverty levels. This could be a contributing factor to why appropriations per capita and staff ratios are higher compared to peer cities. 

    Discussion

    Comparative studies like this can be a helpful exercise to gain perspective of city budget spending and how residents are being serviced based on geographic and economic needs. However, it can be difficult to draw conclusions about whether a city’s appropriations per capita or number of staff per 1,000 residents compared to another city is indicative of better quality services or quality of life for residents.

    Some cities in the sample are spending more money to provide the same services as other cities with smaller populations. When comparing the five peer cities similar in size and service demands, the data shows that Detroit has higher levels of appropriations for spending and budgets for more positions to employ staff. This could be attributed to unique services the city provides its residents. 

    This piece provides a high-level analysis of Detroit’s city budget, comparing it to peer cities similar in size, demographics, and economic measures. Such a high-level comparative analysis can be useful to determine similarities and differences between city appropriations based on the needs and priorities of its constituents. There are also limitations that come with high-level analysis. Nevertheless, benchmarking Detroit to other peer cities allows readers and policy makers to gain perspective and a better understanding of how and why the city makes fiscal decisions at the level it does.

    About The Author

    Esmat Ishag-Osman

    A Comparative Analysis of the City of Detroit’s Budget and Staffing

    In a nutshell:

    • The City of Detroit’s budget, including its General Fund budget, is larger than four peer cities of Cleveland, Columbus, Memphis, and Milwaukee.
    • The City of Detroit employs more staff than its four peer cities.
    • The lack of economic wealth held by Detroit’s residents contributes to higher demand for government services and contributes to the relatively large budget and staff. 

    Almost a decade removed from bankruptcy proceedings, the City of Detroit is on a stable financial footing, but a comparison with several peer cities shows that Detroit has budgeted for relatively higher levels of spending and more staff. 

    Detroit’s $2.5 billion FY2023 total budget ($1.2 billion General Fund) took effect on July 1. The budget supports 10,513 full-time positions, a 1.8 percent increase above the FY2022 budget

    Our analysis of the city’s budget prior to adoption utilized historical data to understand how the city’s fiscal plan has changed over time and what challenges may lie ahead. This blog provides a comparative analysis to several peer cities selected based on key economic and fiscal measures. We benchmark Detroit to other peer cities using their FY2022 budgets as a way to better understand how the city appropriates money and staffs its operations.

    Benchmarking is a process by which a government or organization can measure its performance to comparable entities using a variety of factors and indicators. The objective here is to provide a high-level analysis of Detroit’s current fiscal situation. 

    Comparing Peer Cities Using Descriptive Statistics

    Four peer cities similar in size and economic conditions were selected for this comparative analysis: Cleveland, Columbus, Memphis, and Milwaukee. These cities were selected based on five key measures, such as population, land area, population density, median household income, and percentage of the population below poverty level. 

    In a comparative analysis, it is important to identify peer cities that are similar in population. Two important measures of a population are population size and population density, the number of individuals per unit area or volume. Cities serving larger populations often are called upon to provide more services and require larger staff.

    Of the five cities, Columbus has the largest population while Cleveland has the smallest. Detroit’s population ranks in the middle, as does its geographic size.

    Cities covering larger land areas may require larger staffs and more funding to meet the service needs of their constituents. Memphis has the largest geographic area, while Cleveland has the smallest. 

    Similarly, local governments that serve large numbers of people located in close proximity to one another are called upon to provide more services and services at higher intensity levels than local governments that serve sparsely populated areas. Milwaukee is the most densely populated city in the sample with Memphis ranking last. Detroit’s population density falls in the middle of the pack ranking. 

    Economic indicators such as median household income and percentage of the population below poverty level provide glimpses of the needs within a population. Populations with lower household median income levels and higher poverty levels often have a higher demand for public services. 

    Columbus has the highest and Cleveland has the lowest household median income, while Detroit ranks fourth on the list. All of the five peer cities fall below the average household median income in the United States of $67,521. 

    Income level corresponds with the level of poverty in each city. Columbus, for example, has the highest household median income and the lowest percentage of the population living below the poverty level. 

    Detroit has the highest percentage of its population living below poverty level, with Cleveland close behind. The official poverty rate for the United States was 11.4 percent in 2020, of which all five peer cities exceed. 

    Demographic and Economic Indicators For Five Peer Cities 

    CityClevelandColumbusDetroitMemphisMilwaukee
    Population372,624905,748639,111633,104577,222
    Area (sq mi)82.5226142.9304.696.8
    Pop. Density4,5174,0084,4722,0785,962
    Median Income$31,838$54,902$32,498$41,864$43,125
    % Population Below Poverty Level32%19.1%33%24.6%24.6%

    Source: US Census Bureau

    Total Spending and Municipal Employees

    Total fiscal year 2022 city budgets range from $2.3 billion (Detroit) to $1.4 billion (Memphis), while General Fund budgets range from $1.1 billion (Detroit) to $610 million (Milwaukee). 

    Budgets and Staffing in Five Peer Cities, FY2022
    (thousands)

    GF BudgetTotal BudgetTotal Positions by FTE
    Cleveland$647.9$1,783.45,038
    Columbus$1,033.0$1,821.28,673
    Detroit$1,138.4$2,337.910,324
    Memphis$716.0$1,407.47,698
    Milwaukee$610.9$1,756.87,749

    Source: City of Detroit CAFR; City of Cleveland CAFR; City of Columbus CAFR; City of Memphis CAFR; City of Milwaukee CAFR

    Detroit has the largest General Fund and total budget among the five peer cities. This could be attributed to the fact that Detroit has the highest poverty level and has relatively low median household income among the five cities. In addition, it is the second most populated city.  

    The same observations can be drawn when analyzing the number of total positions by full-time equivalent (FTE) employees for each city. Detroit ranks highest for the number of FTEs. The number of FTEs range from 10,324 FTEs (Detroit) to 5,038 FTEs (Cleveland). 

    Comparative Analysis 

    It is important to note that when looking at these numbers, it can be hard to provide an apples-to-apples comparison of city budgets and FTEs because functions and services provided vary from city to city. All cities pay for police, fire and a myriad of other public services but at differing levels. 

    These differences can be overcome by scaling the data using appropriations per capita and staff per 1,000 residents.

    Detroit appropriates the largest amount per capita through its General Fund budget and the second largest amount, behind Cleveland, through its overall city budget. Milwaukee appropriates the least amount per capita through its General Fund and Columbus appropriates the least per capita through its overall city budget.

    Detroit’s General Fund budget and total budget are both relatively large compared to these peer cities. One of the main reasons for this could be due to the appropriations the city makes to provide its residents with services that are necessary to ensure a greater quality of life. Detroit struggles with high poverty levels and low median household income, which creates a higher demand for public services.

    Another reason for the city’s budget size could be attributed to the unique menu of services it provides that its peer cities do not. For example, Detroit is the only city in the sample that runs its own bus system which adds to cost. 

    Detroit also has an expansive demolition program managed through a designated Demolition Department within the city. With a large geographic area and a spread out population, the city is tasked with maintaining and supporting a city that was once built to service a population of two million people.

    The large exodus of the population over a seven decade period brings abandonment and blight throughout large parts of the city. Population decreases but geography and infrastructure do not. Thus, the city must appropriate more money to departments and personnel to service the maintenance and revival of struggling parts of the city to service its residents. This can be seen when comparing the number of staff per 1,000 residents. Detroit budgets for more staff positions than any other peer city in the sample.

    Comparative Budgets and Staffing Among Peer Cities, FY2022

    General Fund Appropriations Per CapitaTotal Budget Appropriations Per CapitaStaff Per 1,000 Residents
    Cleveland$1,739$4,78613.5
    Columbus$1,140$2,0119.6
    Detroit$1,781$3,65816.2
    Memphis$1,131$2,22312.2
    Milwaukee$1,058$3,04413.4

    Source: City of Detroit CAFR; City of Cleveland CAFR; City of Columbus CAFR; City of Memphis CAFR; City of Milwaukee CAFR

    Columbus is the most populated city and has the fewest staff per 1,000 residents (9.6 FTE). Columbus’ per-capita appropriations also rank low indicating the city is not spending as much as other cities. Detroit is the second most populated city with the highest staff per 1,000 residents ratio. Cleveland has the lowest population and the second to highest staff ratio behind Detroit. 

    Both Detroit and Cleveland rank low for household median income and rank high for poverty levels. This could be a contributing factor to why appropriations per capita and staff ratios are higher compared to peer cities. 

    Discussion

    Comparative studies like this can be a helpful exercise to gain perspective of city budget spending and how residents are being serviced based on geographic and economic needs. However, it can be difficult to draw conclusions about whether a city’s appropriations per capita or number of staff per 1,000 residents compared to another city is indicative of better quality services or quality of life for residents.

    Some cities in the sample are spending more money to provide the same services as other cities with smaller populations. When comparing the five peer cities similar in size and service demands, the data shows that Detroit has higher levels of appropriations for spending and budgets for more positions to employ staff. This could be attributed to unique services the city provides its residents. 

    This piece provides a high-level analysis of Detroit’s city budget, comparing it to peer cities similar in size, demographics, and economic measures. Such a high-level comparative analysis can be useful to determine similarities and differences between city appropriations based on the needs and priorities of its constituents. There are also limitations that come with high-level analysis. Nevertheless, benchmarking Detroit to other peer cities allows readers and policy makers to gain perspective and a better understanding of how and why the city makes fiscal decisions at the level it does.

  • Permission to reprint this blog post in whole or in part is hereby granted, provided that the Citizens Research Council of Michigan is properly cited.

  • Recent Posts

  • Stay informed of new research published and other Citizens Research Council news.


    By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

    About The Author

    Esmat Ishag-Osman

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