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City finance staff reports $939,779 current-year deficit as council hears preliminary budget
Summary
At a council public hearing, city finance staff presented the preliminary fiscal-year budget, reporting a current-year deficit of $939,779, a reduced unassigned fund balance (down ~1 percentage point) and a projected tax rate of 15.7944 mills under the Headley rollback; final adoption is scheduled for May 18.
Anna, a city staff member presenting the preliminary fiscal-year budget, told the Alpena City Council the city is facing a deficit in the current fiscal year and that the FY27 projection has grown since April. “We are estimating a deficit for the current fiscal year of $939,779,” she said during the public hearing. She added the draft shows the unassigned projected fund balance dropping about one percentage point from 16 percent as compared with the earlier draft.
Anna walked council members through the revenue and expenditure picture in the draft. She reported total general-fund estimated revenue of $13.4 million and expenditures of $14.5 million. On property taxes, she said the city’s projected levy would fall to 15.7944 mills because of the Headley rollback; last year’s levy was 15.8436 mills. Using last year’s levy and the updated taxable value, she said the city’s tax revenue estimate under the new levy is roughly $5.2 million, noting that exemptions and collection shortfalls make that number conservative.
On special funds, Anna said brownfield tax-increment revenue was small (she cited about $3,400 in tax increments) and that the Downtown Development Authority (DDA) shows roughly $388,000 in taxation revenue and total DDA revenues near $1.2 million with similar estimated expenditures. She said boat-launch fees in the draft reflect existing rates ($60 for nonresidents, $30 for residents) and that the draft increases the municipal contribution to “HHS” to $30,000 and TNR to $5,000 (as reflected in the posted draft).
Council members asked whether cruise-ship docking revenue was included; Anna said those receipts are recorded in the marina fund but that large projects and needed repairs mean the marina continues to require transfers from the general fund (she estimated the general fund was subsidizing marina operations by roughly $85,000 in the current plans). She also confirmed, per the city charter timeline discussed on the record, that final budget adoption is scheduled for the second meeting in May (she identified May 18 as the planned adoption date).
No members of the public spoke during the allotted public-comment period for the hearing. The council did not adopt the budget at this meeting; the draft will return for final adoption on the date Anna noted.
