How State Policies Affect The Health Of Cities

Despite recent signs of economic and fiscal recovery, many U.S. central cities continue to struggle with declines or slow growth in population and employment, higher tax burdens, lower quality public services, and poorer performing schools compared to their suburban neighbors. This paper examines the factors that have led to fiscal distress in central cities, and fiscal disparities between cities and suburbs, in three states – California, New York and Wisconsin. The paper suggests that further devolution of federal programs to states, like welfare reform, may worsen cities' fiscal problems.