Ferndale manager presents scaled-back Headlee rollback for May; council holds first reading of FY26–28 budget

City Manager Colleen O'Connell outlined a revised Headlee rollback millage proposal scheduled for the May 6 election and told the City Council the May measure is substantially smaller than the version voters rejected in November 2024. O'Connell said the new proposal would reset the city's operating rate to the 2015 level for a 10-year period and would be dedicated to essential operations — primarily police, fire and public works — and facilities maintenance.

Why it matters: O'Connell said the November package included a charter amendment and a full millage reset that would have set a 20-mill charter rate and raised the city's rate by about 4.3 mills; voters approved the charter language but rejected the full millage reset. The May question, she said, is designed to be lower and time-limited: "There's no planned increases to staffing levels as a part of this millage request. It is primarily for police, fire, and public works operations. There is also a set expiration date of 10 years," O'Connell said.

O'Connell gave several numbers and examples from the city's budget work: the city currently budgets 144 full-time positions, the voted override millage previously supported approximately 34 jobs in the budget-cut scenario the city modeled (about 26 of those positions are in police, fire and DPW), and police/fire/DPW account for roughly 78% of the city's general fund labor costs. She said roughly 72% of projected millage revenue would be used to preserve staffing and 28% for facilities maintenance.

O'Connell also highlighted deferred facility needs and a near-term maintenance gap. She pointed to examples at Fire Station 1 and Fire Station 2 (converted restroom to a shower; cramped sleeping quarters next to HVAC) and said the FY26 general-fund facilities maintenance gap is about $1.5 million.

Impact on homeowners: The manager said the city is using a conservative estimate of a 1.1644-mill increase when communicating to residents but that the realistic net impact likely falls in a range of roughly 0.7647 to 0.8736 mills; using the conservative number, she estimated the cost to most homeowners is about $5 to $15 per month for properties with taxable values between $60,000 and $150,000 (she said that range covers about 90% of residences in Ferndale).

Budget hearing and first reading: After the presentation the council opened a public hearing on the FY26–28 triennial budget. O'Connell said the document before council is a one-year legally adopted budget with two forecast years; because a voted millage is not guaranteed, the budget projections currently show a worst-case scenario with no voted millage revenue in years two and three, which would create multimillion-dollar deficits ($6 million in year two and roughly $4 million in year three unless the council shows offsetting reductions). She recommended showing balanced forecasts and told council that doing so would require substantial line-item reductions, likely including wage reductions across departments, if the vote fails.

Public comment and council discussion: Residents who spoke during the hearing included Quinn Ziegler, who chaired the resident-led finance review committee; Jason Storms and Christopher Hall, who urged voters to support the millage to preserve services; and Jim McLaughlin, who framed the decision as a "math problem." Ziegler asked the council to continue benchmarking spending and to report annually on efficiency opportunities. Several council members pressed staff for line-by-line comparisons between the workshop budget and the first-reading document and requested an interfund-reimbursements schedule to clarify how non-general-fund revenues relieve pressure on the general fund.

Council action: Council voted to open and close the public hearing and to acknowledge receipt of the FY26–28 budget for first reading and set a second reading for the April 28, 2025 regular meeting. The motions passed on recorded roll calls.

Next steps: Staff said they will incorporate council feedback ahead of the second reading. O'Connell encouraged residents to review the budget workshop materials online, attend a finance department presentation on April 24 about Headlee and taxable value, and contact city staff via the dedicated email address the manager provided.