DETROIT (AP) — For at least one night, Detroit's troubled economy, blighted neighborhoods and budget problems played second fiddle to Mayor Dave Bing's guarded optimism that the Motor City slowly is driving toward a better future.

Bing's annual State of the City address Tuesday night even opened with a popular Chrysler 200 sedan television ad that makes no apology for Detroit's grittiness and features a voiceover that says the city has survived going through "hell and back."

"Others see that we are changing, but what do you see?" Bing asked residents, business leaders, other city officials and Republican Gov. Rick Snyder, who also was in attendance.

"It is time for us to look in the mirror and recognize that Detroit is on the right track," Bing said. "More importantly, it is time for all of us to think about what we can do to help our city."

The past few years have been tough for Detroit. A brutal national and local economy contributed to the struggles of Chrysler Group LLC, General Motors Co. and Ford Motor Co. Thousands of people lost their jobs at a time of rampant home foreclosures across the city.

Detroit appeared to scrape bottom when a sex scandal involving ex-mayor Kwame Kilpatrick led to criminal charges, his resignation and eventually his imprisonment. A federal corruption probe later snared a city councilwoman, Kilpatrick, his father, appointees and two of his closest friends.

Under Bing, who stepped away from his Bing Group steel supply companies to win the mayor's office in May 2009, the city has persevered, lopped off $180 million from a $330 million budget deficit, made a dent in the most violent of crimes and is putting together a plan to tackle decades of unchecked neighborhood blight.

But the professional basketball Hall-of-Famer tempered that with warnings that the Rust Belt city still has a long way to go.

"We are a work in progress," the 67-year-old Bing said. "Detroit is at a crossroads. We can choose to continue fighting change. Or we can embrace this opportunity to shape a new legacy to proudly hand down to our children and grandchildren."

Homicides and shootings dropped in Detroit in 2010 over the previous year. Homicides were down by 15 percent. Shootings dipped 17 percent as a new data-driven approach led to police saturation of high-crime areas with raids and blitzes.

Surprisingly, Bing also said unemployment in Detroit was down to its lowest levels in two years. Past estimates had put unemployment in the city at about 28 percent.

"It is evidence that we are headed in the right direction, but it is also a reminder of how far we need to go when nearly one in five Detroiters are still out of work and looking for a job," Bing said.

To an extent, Detroit also has been defined by the condition of its neighborhoods, many of which are blighted and overrun with vacant and abandoned houses. An ambitious plan to demolish 3,000 vacant houses through April of this year and another 3,000 next year is under way.

Detroit has lost more than a half-million people since 1970 and many areas in the 139-square-mile city are empty. Bing has suggested that some people in those areas be relocated to other neighborhoods closer to the central city to make them more viable. A draft of his plan for city neighborhoods is expected to be released in April.

Through spending cuts, concessions from city workers and hard-line negotiations with municipal unions Detroit's deficit has been trimmed to $150 million, Bing said, although the budget he presented last spring to the city council pegged the deficit at $85 million.

Snyder, a Republican, released a state budget last week that called for $100 million to be cut from revenue-sharing for local governments.

"The budget presented has potentially devastating consequences for Detroit," said Bing, a Democrat. "No city in the state has taken such an aggressive approach to such serious structural problems as Detroit. Yet, no city would be hit harder than us. It threatens the concrete but fragile gains we have made and we simply cannot afford it."

Bing's message was upbeat, but didn't gloss over issues still facing the city, said City Councilman Ken Cockrel Jr., who served about nine months as mayor after Kilpatrick's fall and lost to Bing in the 2009 special mayoral runoff.

"It's coming and it's something we gotta deal with," Cockrel said of the coming city budget process. "These are very challenging times, but we gotta rise to meet them. We're either going to change or we're going to die. The decisions that we make in the next year to 18 months are going to determine the next 20 years, if not more than that."

Council President Pro Tem Gary Brown said he is awaiting more details about Bing's budget plans "and how we're going to get out of the fiscal mess that we're in."

The city is better off under Bing than it was two years ago, according to 51-year-old Donele Wilkins, a Detroit resident who attended Tuesday night's address.

"I think we're out of the woods in terms of the negative sort of impressions people have about the city," she said. "We're on the right track in terms of some positive leadership that takes people's attention away from the past."