Howell Looks At Deficit In Post-Election Budget Talks
November 13, 2018
Officials with the City of Howell are in budget discussions, after a Headlee Override request failed to gain voter approval in last Tuesday’s general election.
City Council met for a work session Monday night with a goal to reach a consensus on budget targets for the next few fiscal years. The target levels were categorized by small, medium and large, with respect to the size of the city’s structural deficit that grew with each option as the inclusion of money for infrastructure grew. The smallest option of a $200,000-$300,000 deficit would address the structural deficit alone, the medium option of a $500,000-$600,000 deficit would address the deficit while providing a small amount of money for infrastructure, and the large option would result in a $1-$1.5 million deficit to provide a significant amount of money for infrastructure.
Council discussed those target levels after a financial forecast presentation that included a budget update, future year analysis, and information on future projects, challenges and opportunities. City Manager Shea Charles says the consensus among council members is to develop possible cuts in the 2019/2020 budget totaling $150,000 to $250,000, with the potential for the total to reach $300,000. Council members committed to maintaining services and to not reduce the budget in order to fund infrastructure projects.
Council also agreed that future infrastructure projects should only be considered if they’re 80% grant funded or more. There are two upcoming infrastructure projects; one being the reconstruction of State Street, which council plans to move forward with in 2019 as the City will be receiving a $2 million grant that will fund 90% of the project. Council members then directed staff to look at options for the second project, the reconstruction of East Clinton Street, to determine if there is any grant dollars available in addition to the $1.8 million grant they’re expected to receive for the project that's scheduled in 2021.
Despite the decision to maintain city services for the current fiscal year as well as 2019/2020, Charles says council members did direct staff to develop options for potentially cutting city services in fiscal years beyond that. Those options will be discussed at a future budget meeting, which has not yet been scheduled. City Council member Michael Mulvahill doesn’t want to take away services, but says “the reality is something’s got to give.”
Monday’s work session followed voters’ decision to turn down a Headlee Override request that would have generated roughly $1.4 million per year for the next five years to be used primarily on roads and infrastructure, while around 20% would've been used to correct the deficit and maintain city services at their present level. Mayor Nick Proctor stated “elections do have consequences”, after voicing his thought that the city’s fiscal forecast is “gloomy”. (DK)