Detroit hurts as state, federal aid dwindles

The Detroit News reports:

State and federal subsidies to Detroit are on the decline, and that's making the budget-balancing act even more difficult for a city that has relied on them for years.

Since 1996, Lansing and Washington have chipped in, on average, $1.34 for every $1 in income tax and property tax city residents and nonresident workers pay. That's more in state and federal support than any other big American city gets.

Except for casino taxes, which are on track to hit $200 million a year, receipts from Detroit's taxes aren't growing to make up for smaller state and federal payments, a Detroit News analysis of 11 years of city budgets shows.

The figures will be major factors as Mayor Kwame Kilpatrick unveils his budget next Thursday.

He will also be coping with the fact that the city income tax paid by residents and commuters, which totaled more than $337 million in 1996, dropped to $270 million in the current fiscal year. And property taxes, while up from $192 million in 1996 to $241 million in the current fiscal year, are actually down when inflation is factored in. Adjusted for inflation, $192 million in 1996 has the same buying power as $246 million in 2006 dollars, according to the Consumer Price Index.

The poster child for activist government is truly in decline.Maybe,Detroit could sell some real estate.