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Battle Creek Times

Tuesday, November 26, 2024

CITY OF BATTLE CREEK: City changes, eliminates positions due to ongoing COVID-19 budget challenges

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City of Battle Creek issued the following announcement.

As city leaders work through the ongoing budget challenges caused by the COVID-19 pandemic, they made the difficult decision to eliminate 26 positions. 

City Manager Rebecca Fleury and other leaders notified those team members this week, and the changes will take effect for some on Jan. 1, 2021, and others on July 1, 2021 – the latter is the start of the 2021-22 budget year. 

“This is the hardest thing I’ve had to do as city manager,” Fleury said. “My senior leaders have worked for months to innovate and strategize, thinking of ways we can provide services differently. These eliminations have nothing to do with our wonderful team and their skills, and everything to do with our budgetary shortfalls; I must do what is in the best interest of the city’s financial health.” 

The City Commission on Tuesday approved a budget amendment reflecting the position eliminations, and projects using fund balance – the city’s rainy day fund – of $553,328 for the current fiscal year, which ends June 30, 2021.  

That is significantly lower than the $4.97 million of fund balance the commission approved in the original city budget resolution. At that time, the commission asked staff to closely monitor the budget, and develop ways to reduce the use of fund balance. The commission indicated, and staff agrees, that the city cannot sustain such a high use of that fund. 

The savings from eliminating positions are estimated at just under $400,000, for a portion of the 2021 budget year, which started July 1. Leaders expect that amount will at least double in budget year 2022, reflecting savings for an entire year, as well as the July 1, 2021 implementation date for some of the changes. That amount also accounts for several new city positions, and several we seek to fill that have been held vacant, as leaders restructure some service areas, including Assessing and Planning.  

The approved budget amendment also includes a revenue increase of just over $4 million, comprised of $2.47 million in CARES Act funding from the State of Michigan; revenue sharing increases of $1.1 million; and personal property tax replacement dollars totaling $430,680.  

“This funding helps us now, but we do not expect the same dollar amounts for fiscal year 2022,” Fleury said. “Our process to responsibly balance the city’s budget is not over, and we will watch our revenues and expenditures carefully as we move forward.” 

The city’s income tax is one, $16 million revenue stream, leaders will watch; right now those who telework in Michigan do not have to pay income tax in those communities that collect it. Battle Creek leaders and others are working on possible legislative solutions to address those impacts. 

Original source can be found here.

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