Blogs » A Constitutionalist & Believer in Natural Law » Are Cities and Counties Prepared?


I wonder how many cities in our area have a tentative cost cutting plan if there is a collapse of commercial property loans/leases.
This weekend I attended a get to gather of a few financial planner friends.
The general view is that next big financial crisis is going to be in commercial property/leases/mortgages. They are projecting that many retailers and restaurants will soon start closing their doors. 
Commercial buildings represent a large portion of city property taxes. Retailers and restaurants represent a major portion of sales tax revenues.  
I personally do not see any local governments plans to cut spending. Many new construction projects are planned. They are depending upon the stimulus bill to help in many of these expenditures, and they may. But many of these construction projects require some form of matching expenditures.
I contend that before school districts start building a new building, or cities or counties start new construction they look at the vacant commercial building markets. They also should keep enough reserves to ensure there are no lay offs in these government establishments. They should have a plan to cut all but essential services if necessary to prevent a tax increase.
The other prediction is that unemployment will be over 11% nationally this time next year.
I sure hope they are wrong. I am not a financial planner, but even they are expecting a drop in income of at least 50%.