RUNNING HEAD: OAKLAND COUNTY: A LESSON IN FISCAL RESPONSIBILITY
Oakland County: A Lesson in Fiscal Responsibility
Prof. Linda Pitsch
April 15, 2011
Oakland County is one of the more prosperous counties in the State of Michigan. While it has suffered along with other counties, it continues to balance its budget and successfully reduce its expenditures in response to the constricting financial environment engulfing many parts of the country.
County officials have developed a proactive strategy in dealing with revenue shortfall, and increasing retiree and employee benefit costs. Long-range planning initiatives, as well as cost reduction strategies have enabled the County to weather the economic downturn.
Additionally, the County’s ability to diversify its economic base has allowed the County to remain attractive to businesses engaged in activities other than manufacturing. Although a significant amount of jobs has been lost due to the automotive industry restructuring, Oakland County is poised for some growth in the job sector. This also makes it an attractive place to live, work, and play.
Oakland County, Michigan was incorporated in 1820. It covers an area of approximately 910 square miles and boasts a population in excess of 1.2 million people.
Many attributes make this County a world-class attraction for prospective residents, including its thriving downtown communities, excellent schools, and state-of-the-art medical facilities. Also, cultural entertainment abounds with such attractions as the Cranbrook Academy of Art and The Holocaust Memorial Center.
Oakland County has varied cities, towns, and villages, including many rural areas. There are also 370 miles of walking trails, 155 miles of bike paths, and 539 miles of safety/side paths.
Generally considered one of the better local economies in the United States, Oakland County has experienced challenging economic downturns in the past decade. Losing a large segment of it automotive workforce (est. at 60,214 in 2009), Oakland County has made significant strides towards diversifying its economic base. It has fared better than other local governments, mainly due to the fact that its economy is not as reliant on manufacturing.
In September 2010, Oakland County’s unemployment rate was 12.2%. While slightly lower than Michigan’s 12.3% rate, the County exceeded the national average of 9.2%. According to the University of Michigan’s April 2010 Oakland County Economic Outlook report, the County is moving toward a slight recovery with forecasted job gains of 2,421 in 2011 and 7,937 in 2012.
Throughout the past several years of recession/depression, Oakland County continues to introduce and support economic growth initiatives such as Automation Alley, Emerging Sectors, and Medical Main Street. These initiatives and others are examples of the area’s ability to re-invent itself and embrace change. As a direct result, the county continues to be a favorable location for businesses. 859 businesses are housed within Oakland County’s boundaries. These represent 721 foreign-parent firms and 57% of Fortune 500 companies or their subsidiaries.
Oakland County has experienced the same financial turbulence that other governments have suffered. Record-setting numbers of home foreclosures and declining property values have taken their toll. In response, officials have attempted to develop policies and procedures to maintain services despite the dismal economy. Ongoing operations are funded with recurring revenues, rather than through the use of fund balance, or debt. Also, the County has expanded its two-year budget to a three-year budgeting process.
Fiscal stability is further enhanced through the annual budget process which appropriates for full utilization of its 4,245...
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