A federal judge granted Detroit’s Chapter 9 bankruptcy filing earlier this month, making it the largest municipal bankruptcy in U.S. history. Bankruptcy is frequently the product of a history of problems. The unrelenting decline in manufacturing and the more recent collapse of the housing market resulted in a shrinking population, rampant unemployment and high debt, which have devastated the city.

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In order to determine the performance of the nation’s largest cities, 24/7 Wall St. reviewed the 100 largest U.S. cities by population. We considered a variety of factors, including the area’s economy, job market, crime level, and welfare of the population. This year, the best-run city is Irvine, California, while the worst run is San Bernardino, California.

Identifying appropriate criteria to compare cities can be challenging because large cities vary so much. Some have wealthy tax bases, while others fight declining populations and home values. A few have been burdened by struggling industries, while others have healthier service- or innovation-based economies. Because of such differences, a spending or tax policy that can be frugal in one city can be disastrous in another.

Many of the cities that rank poorly have faced difficulties outside of their control. In San Bernardino, Stockton, North Las Vegas, and Hialeah — all bottom-ranked cities — homes lost more than 40% of their value in the past five years, inflicting a severe economic hit.

Cleveland, another poorly ranked city, has suffered from the national decline in the manufacturing industry. Like Detroit, the cities’ poverty rates are more than double the national rate.

Still, some of those factors can be at least mitigated if a city is well-managed. It is the responsibility of city planners to prepare for the worst. Mayors, school boards, and city councils all have a role to play in that regard and must work with the resources available to keep budgets balanced.

In some cases, this means facilitating growth of emerging industries that attract skilled, educated, and well-paid taxpayers to a region. Seattle, Austin, and Scottsdale, all among the best-ranked cities, have managed to do this well.

Strong or weak fiscal management also has an impact on city ranking. Looking at a city’s debt rating as an indicator of fiscal management shows a clear pattern. The debt of the majority of the best-run cities is rated Aaa by Moody’s Investors Service. None of the worst-run cities received that perfect score. And some, such as Detroit, Stockton, and North Las Vegas, are rated below investment grade.

These are the Best- and Worst-Run Cities in America

The Best-Run Cities in America

10. Raleigh, NC
> Population: 424,000 (40th largest)
> Credit rating: Aaa, stable
> Violent crime per 100,000: 423 (25th lowest)
> 2012 Unemployment rate: 6.9% (30th lowest)

Located in the north-central part of North Carolina, Raleigh is the state’s second-largest city. Along with Chapel Hill and Durham, it makes up what is known as the Research Triangle. Because the area is a research and academic center, many of the city’s job are high-skill scientific and academic positions. Largely as a result, Raleigh has an educated and relatively prosperous population. As of 2012, 46.8% of Raleigh’s adults had at least a bachelor’s degree, much higher than the national rate of less than 30%. Raleigh’s unemployment rate was 6.9% in 2012, compared to a national rate of 8.1% that year, and the city’s poverty rate was lower than most of the nation’s largest cities. Like many of the best-run cities, Raleigh’s credit is rated a perfect Aaa by Moody’s.

9. Chesapeake, Virginia
> Population: 228,000 (87th largest)
> Credit rating: Aa1
> Violent crime per 100,000: 369 (15th lowest)
> 2012 Unemployment rate: 6.0% (tied-13th lowest)

Chesapeake residents are relatively wealthy. The area’s median household income of $65,562 last year was well above the national median — despite many in the area working in retail, an industry which has many low wage jobs. More than 15% of the jobs in Chesapeake were in retail as of 2012, more than any large U.S. city except for Stockton, California. According to Moody’s, the city has a diverse economy and tax base, both of which Moody’s considers favorably, although it noted that the city’s tax base had shrunk in recent years. The city also had low unemployment and a high rate of health insurance coverage last year.

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8. Austin, Texas
> Population: 843,000 (11th largest)
> Credit rating: Aaa, stable
> Violent crime per 100,000: 409 (22nd lowest)
> 2012 Unemployment rate: 5.4% (6th lowest)

Austin is located in one of the nation’s fastest-growing metropolitan areas. Last year, the Austin-Round Rock-San Marcos economy grew by 6.5%, compared to a 2.5% uptick nationally. IHS Global Insight, an international information company, estimates the city will continue to grow at a relatively rapid clip. Austin also has the highest available credit rating (Aaa) from Moody’s, which notes that the city is a “large, diverse and regionally important economy.” Jobs are also readily available in Austin. The city’s average unemployment rate was just 5.4% in 2012, among the lowest for any major city and far better than the nation’s 8.1% unemployment rate that year. Austin’s median home value also rose by nearly 6% between 2008 and 2012, one of the largest increases among all large cities.

7. Seattle, Washington
> Population: 635,000 (22nd largest)
> Credit rating: Aaa, stable
> Violent crime per 100,000: 598 (44th lowest)
> 2012 Unemployment rate: 6.4% (tied-20th lowest)

Nearly 94% of Seattle adults had a high school diploma in 2012, while just 6.4% of the city’s workforce was unemployed, both considerably better than the respective national rates. The city’s 2012 median household income of $64,473 was also quite high. The Seattle area’s economy has been quite strong in recent years, growing 3.3% in 2011 and 4.6% in 2012, better than most other metro areas. A number of major companies, including Costco, Microsoft, Amazon, and Starbucks are based in or near the city. The metropolitan area is also a major hub of science, technology, engineering and math (STEM) jobs, according to the Brookings Institution. Having workers qualified for STEM jobs can attract employers and promote economic growth.

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6. Scottsdale, Arizona
> Population: 224,000 (89th largest)
> Credit rating: Aaa, stable
> Violent crime per 100,000: 147 (4th lowest)
> 2012 Unemployment rate: 5.7% (tied-10th lowest)

Scottsdale has some of the wealthiest residents of any large U.S. city. A typical household in the area made $72,102 last year, about $20,000 more than the national median income. Residents are well off by several other measures as well. As of last year, more than 95% of adults had a high school diploma, 10 percentage points better than the national rate. Additionally, poverty and crime rates are among the lowest, compared with other large cities. The city’s credit is rated Aaa by Moody’s. The agency lists the city’s wealth and strong fiscal management as reasons for its perfect rating. Like many Arizona cities, Scottsdale was hit hard by the housing crisis. Home prices fell by 23% between 2008 and 2012, compared to a 12.9% decline nationally. However, Scottsdale’s foreclosure rate was considerably better than those of Phoenix, Tucson, and many other major cities in the Southwest.

5. Virginia Beach, Virginia
> Population: 447,000 (37th largest)
> Credit rating: Aaa, stable
> Violent crime per 100,000: 169 (6th lowest)
> 2012 Unemployment rate: 5.6% (9th lowest)

Virginia Beach’s economy did not have particularly strong growth in 2012, expanding by just 1.9% that year, compared to the 2.5% national growth rate. Still, by most measures, the city had a healthy economy. The unemployment rate was just 5.6% in 2012, compared to a national rate of 8.1%. Median household income in the city was more than $10,000 higher than the national figure of $51,371, and just 8.8% of residents were living in poverty, tied for the third-lowest percentage among the 100 largest U.S. cities. The city was also one of the safest in the country, with a violent crime rate of less than half the national rate.

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4. Lincoln, Nebraska
> Population: 265,000 (67th largest)
> Credit rating: Aaa, stable
> Violent crime per 100,000: 397 (19th lowest)
> 2012 Unemployment rate: 3.4% (the lowest)

By many measures, Lincoln’s economy has emerged from last decade’s recession relatively unscathed. The city’s unemployment rate was just 3.4% in 2012, the lowest among the nation’s 100 largest cities. Between 2008 and 2012, home values remained flat in Lincoln even as they fell nearly 13% nationwide. And more homeowners have been able to afford their mortgage payments. In 2012, just one out of every 811 housing units was in foreclosure, one of the lowest rates among all large U.S. cities. Lincoln is home to the University of Nebraska-Lincoln, which is one of the city’s largest employers. As the capital of Nebraska, many jobs in Lincoln are in the public sector.

3. Plano, Texas
> Population: 271,000 (65th largest)
> Credit rating: Aaa
> Violent crime per 100,000: 131 (2nd lowest)
> 2012 Unemployment rate: 6.0% (tied-13th lowest)

More than half of Plano’s adult population had at least a bachelor’s degree last year, one of the best rates in the nation. Plano’s close proximity to Dallas, combined with efficient public transportation, offers residents easy access to jobs in the larger city. More than 12% of Plano workers were employed in the finance industry last year, roughly double the percentage nationwide, and more than nearly all other large cities. Employment in this traditionally high-paying sector could partially explain the relatively wealthy population in Plano. In 2012, the median household income in Plano was $81,475, more than $30,000 higher than the national median. The city is also a safe place to live. There were just 131 violent crimes per 100,000 residents last year, one of the best rates among major cities. Plano’s housing market also remained strong, with just one out of every 255 homes in foreclosure in 2012, better than the vast majority of large cities.

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2. Fremont, California
> Population: 222,000 (91st largest)
> Credit rating: not rated
> Violent crime per 100,000: 140 (3rd lowest)
> 2012 Unemployment rate: 6.5% (24th lowest)

Fremont was the wealthiest large U.S. city last year. It not only had the highest median income, but also the lowest poverty rate. A typical Fremont household earned more than $100,000 in 2012, or nearly double the national income that year. Meanwhile, the poverty rate of 6.7% was less than half the national rate. Home values in the city didn’t escape the housing crisis unscathed, falling by nearly 12% between 2008 and 2012. Last year, however, a typical Fremont home was valued at $582,100, still more expensive than those in the vast majority of large cities. Sharing the San Francisco Bay area with Silicon Valley, Fremont is a hub for tech manufacturing — 17.5% of workers in the city are employed in manufacturing, one of the highest percentages in the nation.

1. Irvine, California
> Population: 230,000 (86th largest)
> Credit rating: not rated
> Violent crime per 100,000: 51 (the lowest)
> 2012 Unemployment rate: 5.7% (tied-10th lowest)

Irvine has a very well-educated population. Last year, 97% of Irvine adults had at least a high school diploma, and more than two-thirds had at least a bachelor’s degree. The city is home of the University of California, Irvine, which is the top local employer. The heavy concentration of well-educated adults has also led to higher incomes. Irvine’s median household income was around $96,000 last year, exceeding that of nearly every other large city. The typical Irvine home cost about $630,400 last year, more than any other large U.S. city except San Francisco. The city was also one of the safest in the nation, with only 51 violent crimes per 100,000 people.

The Worst-Run Cities in America

10. Milwaukee, Wisconsin
> Population: 599,000 (28th largest)
> Credit rating: Aa2, stable
> Violent crime per 100,000: 1,294 (10th highest)
> 2012 Unemployment rate: 10.1% (27th highest)

Milwaukee struggles with poverty and high crime rates. Last year, a typical household made just over $34,000, and nearly 30% of people lived beneath the poverty line, considerably worse than the country’s figures. There were nearly 1,300 violent crimes per 100,000 residents in 2012, more than three times the national rate of 387 violent crimes per 100,000 people. The city’s socioeconomic problems were among the reasons Moody’s assigned Milwaukee a Aa2 rating. The agency also expressed management-related concerns, specifically highlighting the city’s debt burden and the complexity of its debt financing.

9. Hialeah, Florida
> Population: 232,000 (83rd largest)
> Credit rating: not rated
> Violent crime per 100,000: 347 (12th lowest)
> 2012 Unemployment rate: 11.7% (14th highest)

Just 71.2% of the adult population in Hialeah had a high school diploma in 2012, one of the worst rates among large cities. Also only 14.5% of adults had a bachelor’s degree or higher that year, about half the national rate. Nearly 15% of jobs in Hialeah were in the generally low-paying retail industry in 2012. The city’s median household income was just $28,878 in 2012, one of the lowest among major U.S. cities. Nearly 36% of residents didn’t have health insurance last year, the most among the 100 largest U.S. cities. Like many other areas in Florida, Hialeah’s recovery from the housing crisis has been strained. One in every 19 homes was in foreclosure at the end of 2012, tied with Miami for the worst foreclosure rate among large cities. This is not surprising, given that the median home value in the area plummeted by 43.1% between 2008 and 2012, one of the sharpest declines over that period.

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8. North Las Vegas, Nevada
> Population: 223,000 (90th largest)
> Credit rating: Ba1, stable
> Violent crime per 100,000: 764 (34th highest)
> 2012 Unemployment rate: 13.3% (7th highest)

Incorporated in 1946, North Las Vegas is part of the Las Vegas Valley but is separate from its larger namesake to the south. While both cities were hit hard by the recession and housing crisis, North Las Vegas fared slightly worse. Between 2008 and 2012, the median home value in North Las Vegas fell by 50.7%, the second-largest decline of any large U.S. city over that time. Additionally, last year 13.3% of the city’s workforce was unemployed while one in every 29 homes were in foreclosure. Both figures were not only among the worst in the nation, but were also worse than neighboring Las Vegas — often seen as a poster child for the negative effects of the housing crisis.

7. Cleveland, Ohio
> Population: 391,000 (46th largest)
> Credit rating: A1, stable
> Violent crime per 100,000: 1,384 (8th highest)
> 2012 Unemployment rate: 9.5% (30th highest)

In general, Cleveland residents are not wealthy. A typical household made $24,257 last year, less than half the national median income. Meanwhile, the city’s poverty rate was 36.1%, more than double the national rate and worse than every large U.S. city except for Detroit. According to Moody’s, the city’s socioeconomic profile and long-running population loss remain challenges. Additionally, crime was considerably worse in Cleveland than in most other populous cities, with 1,384 violent crimes per 100,000 people in 2012. High levels of poverty and crime may make it difficult to attract residents to the area. Among large U.S. cities, Cleveland had the second-highest rate of vacant homes at 22.8% in 2012, trailing only Detroit.

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6. Fresno, California
> Population: 506,000 (32nd largest)
> Credit rating: Ba2, negative
> Violent crime per 100,000: 543 (39th lowest)
> 2012 Unemployment rate: 14.3% (5th highest)

Fresno appears to have made immense progress in fighting organized crime. Following a major crackdown on the Fresno Bulldogs gang, the city’s violent crime has declined. According to FBI statistics, there were 543 violent crimes per 100,000 people last year, worse than the national rate but better than most large cities, where crime tends to be higher. However, the city still faces big challenges. Roughly 25% of adults lacked a high school diploma as of 2012, versus just 13.6% nationally. Additionally, Fresno’s poverty rate of 31.5% was one of the highest among large U.S. cities. Agriculture is a major part of the economy in Fresno and the San Joaquin Valley. While the industry supplies many of the area’s jobs, many residents are often unable to find work. In 2012, the city’s 14.3% unemployment rate was considerably higher than the 8.1% national rate.

5. Stockton, California
> Population: 298,000 (59th largest)
> Credit rating: Ca, developing
> Violent crime per 100,000: 1,548 (5th highest)
> 2012 Unemployment rate: 18.3% (2nd highest)

The housing downturn, as well as years of poor fiscal management by city officials, led Stockton to file for bankruptcy in 2012. Even as it is preparing to exit bankruptcy, pension obligations still loom over the city’s finances. Stockton’s debt currently carries a Ca credit rating from Moody’s, lower than that of any other major city. The local economy struggles as well. Stockton’s average unemployment rate of 18.3% in 2012 trailed only Detroit among large cities. Also, one in every 40 homes was in foreclosure in the fourth quarter of this year, again one of the highest rates among large cities. Crime remains a major issue, with 1,548 violent crimes per 100,000 people last year, worse than all but a handful of major cities.

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4. Miami, Florida
> Population: 413,864 (42nd largest)
> Credit rating: A2, negative
> Violent crime per 100,000: 1,172 (15th highest)
> 2012 Unemployment rate: 10.3% (24th highest)

Miami’s credit is rated A2 with a negative outlook, one of the worst among large cities. Roughly one in 10 jobs in Miami is construction related, more than the vast majority of the largest U.S. cities. Miami’s poverty rate of 31% last year was roughly double the national rate. Job growth in Florida’s construction industry has improved somewhat recently, but the sector has a long way to go after it was slammed by the housing crisis. Between 2008 and 2012, Miami home values fell by nearly 40%, one of the worst drops among major U.S. cities. Last year, one in every 19 homes in the area were in foreclosure, worse than all but one other large city. On the other hand, Miami has recently been experiencing a boom in condo construction.

3. Newark, New Jersey
> Population: 227,718 (38th smallest)
> Credit rating: A3, negative
> Violent crime per 100,000: 1,155 (18th highest)
> 2012 Unemployment rate: 15.0% (4th highest)

After spending years working to revitalize Newark as mayor, Cory Booker was elected New Jersey’s newest senator. Booker’s legacy, however, remains mixed, with some unconvinced he has produced real improvements or long-lasting changes. The city still faces massive challenges: As of 2012, barely two-thirds of adults 25 and older had a high school diploma; 15% of the workforce was unemployed; and the city’s violent crime rate was nearly three times the national rate. The city’s school district has worked to improve the quality of education. Last year, it moved to base compensation on performance, and it recently announced broad restructuring plans, according to The Newark Star-Ledger. However, the city’s financial management is still lacking. Moody’s has criticized Newark officials for not filing budgets and audits in timely manner, and points to the city’s use of financing to cover cash shortages.

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2. Detroit, Michigan
> Population: 701,524 (18th largest)
> Credit rating: Caa3, negative
> Violent crime per 100,000: 2,123 (the highest)
> 2012 Unemployment rate: 18.6% (the highest)

In July, Detroit became the largest city in American history to file for bankruptcy. The city has had to cope with high debt, a declining population, and extremely poor management — former Mayor Kwame Kilpatrick is currently in prison for corruption. The city faces a long road to recovery — even now its bankruptcy is being disputed in court by its pension plans. Detroit may have to resort to selling valuable pieces of art from its collection. Residents are struggling as well. The city’s 18.6% unemployment rate was the highest among large cities in 2012, and its median household income was less than $24,000, the lowest of any large city. More than 30% of housing units were vacant last year, far more than any comparable city.

1. San Bernardino, California
> Population: 213,298 (9th smallest)
> Credit rating: not rated
> Violent crime per 100,000: 941 (26th highest)
> 2012 Unemployment rate: 16.0% (3rd highest)

In the summer of 2012, San Bernardino filed for bankruptcy in the face of a $46 million deficit. The filing came in the wake of falling tax revenues, poor financial planning, including inaccurate reporting from city officials, and a housing market in crisis. Last year, home values were about half what they were in 2008. Nationally, home values fell by nearly 13%. San Bernardino — population 213,298 — was at the time the second-largest city to file for bankruptcy, behind Stockton. City residents have not been faring much better than the city itself. Median household income was $37,244 in 2012, well below the typical income across the country. Further, San Bernardino’s average unemployment rate was 16% last year, nearly double the national rate of 8.1%. Less than 11% of adults living in San Bernardino had a bachelor’s degree or higher last year, the smallest percentage of any large U.S. city.

In assessing the best- and worst-run cities, 24/7 Wall St. reviewed data from a number of sources for the 100 largest cities in the country, as measured by population figures from the U.S. Census Bureau’s 2012 American Community Survey. We relied on the U.S. Census Bureau’s American Community Survey for income and poverty data, as well as graduation rates, health insurance coverage, and the change in home values between 2008 and 2012. Unemployment rates are from the Bureau of Labor Statistics and are 2012 averages. Moody’s Investors Services provided the general obligation debt ratings as of December 23, 2013. Violent crime rates were obtained from the FBI’s Uniform Crime Report for 2012. Gross metropolitan product data for 2012 were obtained from the U.S. Conference of Mayors’ report U.S. Metro Economies. Foreclosure rates for the fourth quarter of 2012 were provided by RealtyTrac. Once we reviewed the sources and compiled the final metrics, we ranked each city based on its performance in all the categories. A few cities did not have credit ratings, foreclosure rates, violent crime rates; they were neither rewarded nor penalized for the missing data. All ranks, unless otherwise specified, are for the 100 largest cities. All data, unless otherwise specified, are for the full year 2012. All data represents the city as designated by the census. The exceptions are the Gross Metropolitan Product, which reflects the GMP of the metropolitan statistical area in which the city is located, and foreclosure rates, which are areas designated by RealtyTrac.

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