City reports $65.2 million year-to-date surplus and presents FY26 budget proposal to committee

Donnie Johnson, Detroit—s deputy budget director, told the Budget, Finance and Audit Standing Committee on March 19 that the city is $34 million ahead of year-to-date revenue projections and about $31.2 million under budget on expenditures, producing a $65.2 million surplus through the first seven months of fiscal year 2025.

Johnson said the mayor—s proposed fiscal year 2026 budget and four-year plan, presented Feb. 28, totals $1.58 billion for general fund activities and $3.02 billion across all city funds for the year beginning July 1, 2025. Johnson said Detroit is projecting to remain balanced and that City Council will vote on a final budget by April 7 and transmit the approved plan to the Financial Review Commission by April 30.

Johnson and Nikhil Patel, deputy CFO and treasurer, reviewed revenue and cash-flow details. The presenters said January collections were about $5 million behind January of last year—largely a timing issue driven by withholding and estimated corporate payments—but that February data indicated collections would recover. Cash-flow changes from 2024 to 2025 were driven by several items Johnson and Patel highlighted, including the real property tax fund contributions, capital project spending reductions, and ARPA drawdown.

The report noted the U.S. Bankruptcy Court for the Eastern District of Michigan approved a motion March 6 to amend combined pension plan documents to allow a $10 million payment to the General Retirement System and Police and Fire Retirement System components; committee members asked about timing for distributing that payment to retirees. Johnson said payroll and the pension system were working through the process; a committee member said attendees at a retiree task force expected distribution around May.

Committee members asked for clarification on employee counts and surpluses. Johnson said the city takes a conservative approach and does not finalize expenditure surpluses until year-end and audit adjustments are complete. Council member Mr. Corley noted the council had approved a budget amendment that reduced the projected $72 million revenue upside by roughly $46 million; Johnson said that amendment had been accounted for in subsequent materials.

The committee voted to receive and file the monthly financial report by unanimous consent: "Hearing no objections, that action shall be taken." Staff said they will provide additional detail in subsequent budget hearings.