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City holds public hearing on budget

May 11, 2008
Mining Journal
MARQUETTE — The Marquette City Commission will hold a public hearing on the 2008-09 fiscal year budget at its meeting Monday.

The commission meets at 7 p.m. in commission chambers at city hall.

Over a span of three special budget meetings in April, commissioners cut about $300,000 from the city’s expenses.

City Manager Judy Akkala charged individual department heads with either finding additional revenue sources or cutting their department’s expenses by five percent.

Commissioners then voted on whether or not to accept the department heads’ recommendations.

City residents won’t see an increase in city taxes this year, but next year could be a different story.

The projection for a possible tax increase in 2009 was based on the need to begin debt payments next year for the $9.5 million in bonds the city issued.

The $9.5 million would be used for major city projects, including reroofing the city’s municipal service center’s salt barn, reconstruction of Wright and West Michigan streets, repairs of Alger and Champion streets and annual maintenance of streets and sewer lines.

Finance Director Gary Simpson said that, based on this year’s numbers, the debt service payments would be a problem for the general fund next fiscal year. However, he said revenues may increase next year as well due to increased taxable value of city property. He said if taxable value were to remain flat, the budget would run a deficit of a “couple hundred thousand dollars.” In that case, Simpson said the city would have to raise the millage by 0.46 mills to pay for general fund debt service next fiscal year. Currently, the city levies 15.27 mills.

City residents will see increases in their water/sewer and stormwater rates beginning July 1.

The city will have to raise the rates to help pay for the projected debt service of major reconstruction projects.

An average taxpayer pays about $4.74 a month in stormwater and that would increase by 35 cents for a new monthly rate of $4.74.

The average taxpayer pays about $45 a month for water/sewer. If the city paid back the bonds over a 20 year period, that rate would increase by $2.83 for a new monthly rate of $47.83.

The increase for water/sewer rates is on top of a previously scheduled increase to help pay for the $14.9 million Marquette Area Wastewater Treatment Facility improvement project — scheduled to be completed in October.

At an earlier audit presentation commissioners were told payments from state revenue sharing — which represents about 15 percent of general fund revenue — have decreased over the last few years and were unlikely to increase in the near future. The commission was warned that as health insurance costs go up and the price of gasoline and natural gas increases, the city will have to start looking at alternative ways to raise revenues, such as user fees.

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