| Monitoring the fiscal stress levels of local governments at the state level is a critical strategy for predicting and preventing fiscal crises. The State of Michigan currently monitors the fiscal stress levels of its local governments using a set of indicators created in 2002. These indicators, however, are not capturing all types of fiscal stress and are not being utilized to their fullest. In this report, we outline proposed changes to the current system, calculate the proposed indicators, and then compare them to the current system. The new fiscal stress indicator system proposed here builds upon the current system in five ways. First, it better captures different types of fiscal stress that are being missed in the current system, including those caused... |
