Alpena council reviews preliminary FY25 budget, hears millage rollback and multiple fee changes

The Alpena City Council opened a public hearing on the preliminary fiscal year 2025 budget on May 19, where city finance staff outlined changes that narrowed the projected general fund deficit and explained a required millage reduction under state rules.

Anna Swick, clerk, treasurer and finance director, told the council the budget draft presented May 5 was updated to include a $50,000 transfer from the perpetual lot care fund, an added $4,200 cost for bagged leaf pickup for FY26–27 and a $17,666 correction for an insurance payment in the major streets fund. Swick said those changes reduced the previously presented FY25 general fund deficit from $907,926 to $857,926 and left a planned reduction from fund balance of $997,178 on the general fund schedule.

The budget presentation also explained the effect of Michigan’s millage reduction fraction (Headlee rollback). Swick said the city levied 15.9827 mills in 2024 but will be able to levy only 15.8436 mills for the 2025 tax levy because a millage reduction fraction of 0.9913 applies to the city operating millage; the downtown development authority’s (DDA) voted millage will drop from 1.9812 mills to 1.9465 mills under a separate fraction of 0.9825. Swick said the city’s taxable value for the 2025 tax year is $316,256,139 and explained the rollback calculation steps the county equalization office provided.

Council members asked clarifying questions about where revenues were estimated and whether the city budgets conservatively for collectible personal property taxes. Swick explained that the county reconciles collections March 1 and makes the city whole for uncollected real property taxes but that personal property collections are less certain.

Council members also reviewed proposed fee and policy language changes that staff flagged during the budget review. Council member Jenkins (referred to in discussion as Bridget) and staff agreed to remove a sentence that implied tenants paid rental-inspection appeal fees; Jenkins said tenants do not pay those fees and the language should be eliminated. The council discussed rental of courts at Bayview Park and asked staff to clarify what a $50 “sports courts tournament” rental would reserve (single court vs. multiple courts). On marina reservation policy, council members asked for language clarifying the nonrefundable nature of the $100 slip deposit when a slip is reserved and not paid for by the deadline.

On seasonal boat-launch fees, staff had proposed a single $40 seasonal fee for all users; council members debated restoring a resident discount (previously $25 for residents, $50 for nonresidents). One council member suggested proportionate percentage increases instead of a flat, uniform fee so city residents would not pay more than nonresidents. No final ordinance language change was recorded in the hearing; members said they would give direction to staff before the budget is finalized.

Staff said compost sales would remain limited to 5 yards per day per customer unless prior approval is obtained; the charge is $20 per yard, which staff said essentially covers the city’s costs for producing and managing the compost. Swick said contractors occasionally request larger amounts and that residents may arrange larger pickups through DPW.

During the meeting finance staff reported an ARPA (American Rescue Plan Act) balance of roughly $110,843 and recommended transferring $107,011.45 from ARPA to the general fund to pay for the city’s purchase of 800 megahertz radios requested by the police department. That transfer was described as a staff recommendation in the budget discussion; the transcript does not show the council taking a separate, recorded vote on that transfer during the public hearing.

Actions taken at the meeting that relate to the budget and consent items included approval of the consent agenda (which contained liquor-control items for cider-mill permit applications) and multiple housekeeping and procedural motions. Staff said more budget edits will be made before the June 2 meeting when the council will consider the final proposed budget.

Why it matters: The millage reduction fraction and the budget’s projected draw on fund balance determine how much general-fund service levels can be sustained without a voter-approved millage override; fee, rental and user-fee changes discussed at this hearing affect residents and seasonal users of city parks, the marina and compost service.

Council discussion continued across several line items; staff will return with clarified fee language and the council will consider final budget adoption at a later meeting.