Council approves 2026 city budget with $478,667 increase; TIF use to be reviewed

Presque Isle — The City Council voted 6-0 on Wednesday to adopt the 2026 city budget, approving total appropriations of $20,294,183 and a net general fund spending level of $9,213,983, authorizing a $478,667 increase over last year.

Sonia, a city staff member presenting the budget, said the proposal “balances services, affordability, and long-term stability” and reflects council direction and prior workshops. She told councilors the budget package represents a 68-cent increase in the mill rate and a 3.11% overall increase for the year.

The budget includes an option that would use $175,000 from the tax increment financing (TIF) district to offset downtown expenses; that approach would reduce the net increase to $303,667 and lower the mill-rate impact. Sonia said the packet includes the TIF district guidance and a letter of agreement staff relied on in evaluating allowable uses, and she recommended the council fund the budget initially without relying on TIF until staff can confirm specific eligible expenditures.

Councilors asked for clarification on TIF availability. Staff responded that the TIF balance cited in the packet is “1.7” and cautioned that some of those funds are encumbered for projects; staff also said the district receives about $150,000 on average annually, so targeted use would not necessarily permanently deplete the fund.

Sonia identified several pressure points and policy changes underpinning the proposal, including reclassifying the deputy finance director position to accounts payable to better align staffing needs and modestly reduce costs, and capping outside funding requests at $5,000 per request based on council feedback. She said staff refunded $5,000 to “Cloggy Joe” and that the cumulative outside-request total under the new cap reduced prior larger totals to roughly $34,000.

A councilor raised a question about funding for the Area Agency on Aging; members clarified a proposed $1,200 increase (a correction of a verbal confusion earlier in the meeting) and indicated support for keeping that funding level.

At the meeting the chair called for a motion. Councilwoman Chassy moved to accept the 2026 city budget appropriations as presented, and Jim seconded. The clerk read the formal resolution language, which lists total appropriations of $20,294,183, total revenue of $11,080,200, and a net general fund budget of $9,213,983. The airport fund was listed with $5,899,026.99 in expenses and $5,898,704 in revenue, leaving a $565 net appropriation from the general fund.

The motion passed on a 6-0 vote. Council directed staff to continue monitoring revenues and expenditures, to provide regular (quarterly) updates, and to research and report back on whether and how TIF funds can be used for the downtown services identified in the packet. Staff also indicated no additional personnel changes were being recommended beyond the discussed reclassification.

The council offered thanks to staff for their work and moved on to other items on the agenda.