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Ishpeming finance director warns of shrinking general fund; council weighs a millage option
Summary
City finance staff presented April financials showing declining general, major and local-streets funds and outlined options including a hypothetical 2.5‑mill ballot proposal; council agreed to public open houses and to prepare budgets with and without a millage.
City staff told the council the city's general fund and street-maintenance accounts are shrinking and that winter plowing costs have pushed major and local-streets budgets beyond anticipated appropriations.
The finance director presented the April 30, 2026 financial excerpt and said the general fund recorded $105,000 in tax revenue for April while noting large expenditures for pension-bond debt service. The director said major streets had collected $79,000 in gas-and-weight taxes in April but faced heavy winter maintenance costs; local streets had expended about 140% of its plowing budget year to date and had a smaller reserve. The public-improvement fund includes roughly $500,000 in state FEMA Section 19 grant money, some of which subsidized the 3rd Street storm-sewer work.
Staff outlined five broad options to respond to the fiscal stress: reduce wages/benefits, cut staffing, cut services, pursue a millage, or pursue development to expand the tax base. As an illustrative example, staff projected a 2.5‑mill general fund increase would raise roughly $399,000 communitywide (net of retiring the fire-equipment millage), translating to an estimated $90 annual increase for a typical primary residence in the city's example. Staff emphasized the 2.5 number was a hypothetical figure for discussion, not a formal recommendation.
Councilors expressed concern that a 2.5‑mill increase might not be sufficient for long-term needs and asked staff to provide numbers for a 3‑mill scenario. Members also discussed alternatives to a millage, including adjusting user fees (the finance director pointed to cemetery rates as an example), pursuing grant-matched debt for roadway projects, and asking townships that use the library to contribute more. Staff said open houses are scheduled to collect resident input and that, if a millage is put on the ballot, staff would prepare two budget scenarios (with and without the millage).
At the meeting the council voted to adopt Resolution 13-2026 to strike the fire-equipment millage from the levy and to apply surplus funds to pay down other general-obligation debt; that measure passed by voice vote. Council also tabled first-quarter budget amendments pending full-council consideration and additional information.
