City of Plymouth Proposed 2022-2023 Budget - Flipbook - Page 282
CRC Memorandum
Daytime Populations. A revenue distribution methodology based on a measure of daytime populations
would better reflect where interaction between people occurs. Many local governments have daytime
or seasonal populations that are remarkably different
than their census, or nighttime, populations. Communities that host office buildings, commercial centers of commerce, and industry tend to have larger
daytime populations than their census populations
would indicate. Conversely, Michigan’s bedroom
communities tend to empty out during daylight hours
when residents commute to places of employment
or commerce.
While the daytime and seasonal populations are
preferable to census or nighttime populations as
pseudo measures of need, this measure is still less
than desirable for several reasons. Most significantly,
like the nighttime population, this measure does not
account for differences in density.
The greatest obstacle to using daytime populations
as a factor in distribution calculations is the lack of
reliable data. The problem is that there is not a third
party that counts the number of people that come
to these places. Each tourist attraction, shopping
mall, etc. can have incentives to overestimate their
popularity, and there are no means to audit or validate the populations that they may report.
Population Density. Population density is an alternative to the use of the census population. This is
simply a measure of the average number of people
living within each square mile of land area in a community. Since the population density of different
communities is highly correlated with the number
and intensity of services that the communities provide, this measure better reflects the demand for
governmental services.
Building Counts and Building Density. In addition
to services provided to people, local governments
provide a number of services to properties. Fire
protection, refuse collection, storm sewers, and
snow removal are examples of services for which the
intensity and cost of services depends to a greater
extent on the number of buildings than the number
of people being served.
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Unit Type. Historically, residents of a community
have chosen a level of incorporation – city, village,
or township – for their local government to reflect
the level of services they expect from that unit. The
1998 reforms to the state revenue sharing distribution formula included a measure of the unit type that
was based on the contention that service delivery
costs are a function of the type of unit and population
size within a given unit type.
Evaluation of Service Demand Factors. Population
density, building density, and/or unit type could be
used, individually or in combination, to reflect the
greater service demands on some local governments
as opposed to others. They could be used to create
weights that would be applied to the local government’s population, as measured by the decennial
census or the American Community Survey.
Funding Certain Key Places
Part of the state’s exercise in defining its relationship
with local governments and the goals it hopes to
achieve through a revenue sharing program might
include an assessment of whether some places are of
extra significance to the state. Of course, the state
has an interest in all local governments operating at
their respective peak, but it has a stronger interest in
some local governments. This strategy would direct
state resources to those places for which the state
has the strongest interest to the exclusion of other
places or public services.
Agricultural communities, while important to the
state economy, do not require a great deal of local
government services. Forestry is a very important
part of the state economy as well, but again it requires little by way of local government services. The
idea here is that Michigan’s core cities, commerce
centers, manufacturing hubs, and tourist destinations, require a higher level of intensity in local
government service delivery. Therefore since such
places contribute significantly to the state economy
and are important to outsiders’ perceptions of the
state, servicing these locations ought to be a priority.
Directly Fund Key Services
State policymakers could also drop the pretense of
providing this funding for unrestricted use by local
