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Berkeley council adopts FY2026–27 budget, keeps overall millage steady while approving utility rate increases
Summary
The Berkeley City Council adopted the FY2026–27 budget and millage rates after a detailed presentation of revenues, capital needs and constraints from Michigan property‑tax law. The council also approved an 8% increase to variable water and sewer rates (about a 4.7% average bill increase).
A majority of the Berkeley City Council voted May 4 to adopt the city manager’s proposed FY2026–27 budget and the accompanying millage rates, approving a multiyear financial plan that staff said balances constrained revenue growth with a pressing capital program.
City Manager (name on file with the city) and Finance Director Carl Johnson presented the budget, highlighting a widening gap between assessed and taxable values under Michigan’s Proposal A and Headley rules that limit the city’s ability to grow tax revenue. Johnson said the city’s taxable value stood near $904 million and assessed value near $1.2 billion, leaving a buffer that reduces short‑term revenue risk but limits long‑term capital flexibility.
The budget package directs funding to infrastructure priorities, including lead‑service‑line replacement, sewer lining and the recently approved Bacon Avenue water‑main and road reconstruction project. Staff emphasized that construction costs have risen sharply in recent years and that many water mains date to the 1930s, increasing the urgency of planned work.
To support the capital program and rising utility costs, staff recommended an 8% increase to the variable rates for water and sewer service. Staff explained that the variable rate change translates to an estimated 4.7% increase on the average residential bill (15 units per billing period) and would help cover operational costs, treatment and infrastructure maintenance. Council approved updates to the fee schedule that incorporate the proposed rate changes.
Council members thanked staff for the extended outreach and detailed presentation. The council voted to adopt two resolutions — one adopting the FY2026–27 budget (with acknowledgments of projections for 2027–29) and a second adopting the proposed millage rates — and the motions passed on roll call.
The adopted budget is effective July 1, 2026. Staff said details and supporting documents are posted on the city website, and additional work sessions and materials will be available for residents who want further explanation.
