Howell City Council Exploring Future Budget & Road Options
April 4, 2019
Howell City Council has scheduled another budget work session as it explores different mechanisms to deal with revenue shortfalls attributed to a broken state fiscal model.
Another City Council work session is scheduled April 15th at 6pm to review the proposed 2019-2020 annual budget. During the most recent Howell City Council meeting, Mayor Nick Proctor noted the trials and tribulations of the budget and the Headlee Override that was turned down by voters last November to support current levels of service and infrastructure improvements. He says they have labored to make some significant cuts to rectify a structural deficit for the next fiscal year and ensure a balanced budget. However, Proctor said he is also thinking about their successors several years from now who will be wrestling with the same budget issues, but also a more deteriorated infrastructure and roads system.
Thus, Proctor said he questioned if it would be fair to punt the pile of issues to them to solve. He said some roads will get to the point where they have to reconstruct the entire base versus just the surface and the cost will be disproportionately higher. That being said, he proposed Council consider a special assessment for the Rolling Oaks subdivision, which is self-contained with no thru traffic. Proctor said he feels it is council’s responsibility to try and do something so future councils won’t have to deal with it, as unpopular as it may be. Staff noted they receive complaints about roads in the subdivision, which are about 25 years old but have a good base so it would be mostly surface work. Proctor stated they are in a tough position but also feels they have a certain responsibility as elected officials to try and fix roads through different mechanisms and there would be a public hearing process.
Councilman Bob Ellis stated that if they were to just impose an assessment, then there would be a lot of upset people. Ellis said he would be more open to proceeding if people petitioned council. Councilwoman Jeannette Ambrose agreed about reaching out to residents, commenting it made her uncomfortable to think that the city might impose an assessment on a self-contained community when other residents and businesses have already received help for their roads that were previously done. However, Ambrose said she was not opposed to understanding the process and cost. It was ultimately agreed to direct staff to put together a cost estimate and how the process works before deciding how to officially proceed.
Later in the meeting, Proctor commented it’s his belief that at some point in the next 24 months, they will likely have to go back to voters for a Headlee Override, although it might be a lesser amount than originally sought. He suggested Council convene a panel to examine the budget, revenues, expenditure, debt and pension liability and make some non-binding suggestions to council on how to handle things going forward. Proctor said that may give current or future councils something else to point to, to further justify whatever millage or override they might decide on in the next few years. He acknowledged there are potential downsides and they have to go in with eyes open, in that they might be told something they don’t want to hear but that could also be good for them. Council was supportive of the concept and also creating a charging document to spell out what the task force is charged with - not to restrict but rather keep the group focused and also let individuals know what they’re getting into.
Proctor noted the city’s bond rating, award winning financial staff and audits demonstrate they are not mismanaging anything. He said while they can tweak spending a bit, he believes it’s predominantly a revenue problem with a dysfunctional state system. Councilman Michael Mulvahill said during the Headlee Override process, he was directly told the budget was being mismanaged so he welcomes any direction or guidance or new ideas. He supports the group concept, as it offers an opportunity to look at the budget and understand what they’re spending, why and how much they’re generating. Councilman Bob Ellis heard many people suggest an “across the board” spending cut but he said that is not practical and it doesn’t work that way, adding there were organized groups spreading misinformation during the override. Mayor Pro-Tem Steve Manor commented that the city budget is much different from a family budget or business enterprise - noting the expenses and charges are different, with various legislative mandates and they can’t make a profit.
A future decision will be made as to the panel group’s composition. It would be comprised of not more than nine or ten people who are city residents and business owners and people of both political persuasions. The finance director and city staff would also be involved. Proctor told WHMI they can’t take their foot off trying to solve this problem, thus his proposals to consider special assessments to repair roads and convene a working group of citizens and business owners to look at the City’s revenue stream, expenditures, debts, pension liabilities and the whole budget to come up with some non-binding suggestions on how to tackle the problem. Proctor says in his opinion it’s always good to get other views and eyes on the problem because maybe they can see something they’re not so he feels it’s worth exploring and council is heading toward that goal. (JM)