The Boyne City Commission had a Tuesday March 18 work session planned to go over its 2014-2015 budget. (Results next week)
Commissioners are working with a proposed budget of $12,391,898, which would see the city’s total operating levy of 15.51 mills remain as it has for the last few years.
“The City of Boyne City continues to be in excellent financial health,” stated Boyne City Manager Michael Cain in his March 11 budget narrative. “It allows us to maintain excellent services to our customers while undertaking a steady amount of significant projects to improve our community.”
According to Cain, the budget as proposed also maintains current staffing and service levels.
“The proposed general operating millage rate remains at its lowest rate since 1999, and the proposed overall city millage rate is now the lowest the city has levied since before 1975, over 38 years ago, when the rate was 16.0 mills,” stated Cain…. “Since (1991) the overall city millage rate has been reduced 18 percent, or by 23 percent if the library is excluded. Since the library was a city function back in 1991 it was included in the overall city total.”
He further stated, “The millages levied by the schools have dropped some 21 percent for non-homestead properties over that same period and a whopping 68 percent for homestead properties due to the changes in state school financing. County-wide funding has gone up by some 41 percent, primarily due to new voter approved millages for items such as road repairs, senior services, and recycling.”
The proposed contributions from the city’s general fund to both the major and local street funds totals $621,402—down from the previous year’s approved amount of $925,765, and nearly half of the $1,114,947 from two years ago.
“This remains a significant portion of the proposed 4.9-plus-million-dollar general fund budget for the coming year,” Cain stated. “During the last 14 fiscal years, total general fund street contributions have ranged from a low of $449,000 in 2001 to the high of $1,225,000 approved in the 2011-2012 fiscal year budget.”
He added, “This coming year’s general fund contribution is equivalent to approximately 3.41 mills of street millage.”
Boyne City is authorized, by its charter, to levy up to 20 mills.
According to the proposed budget narrative, the 4.49 mills that the city is below its charter limits represents nearly $722,828 in unused capacity annually.
While the proposed budget does not include plans to raise millage levels, Boyne City Mayor Ron Grunch did recently request a projection of what a one-mill levy would raise in tax revenues over both a 30- and 40-year period. Grunch made the inquiry during a recent Boyne City Commission discussion on the city facilities architectural bids.
According to Cain, each mill levied in Boyne City generates nearly $161,000. Therefore, a 30-year millage would generate $4.83 million; a 40-year millage at that rate would generate $6.44 million. It should be noted that no discussion outside of Grunch’s request for a projection has taken place among commissioners.
“In order for the city to levy a millage rate higher than 16.01 mills, a vote of the public would be necessary,” Cain stated.
According to the proposed budget, Boyne City’s Cemetery, Ambulance, Fire, Rubbish, Major and Local Street funds continue to require contributions from the general fund.
Conversely, the city’s marina and airport funds do not appear to require contributions for at least the upcoming fiscal year.
Most of the city’s rates will remain unchanged. However, a 1.6 percent increase has been proposed for the city’s water and sewer rate in order to maintain the system.
“We have gone with smaller rate increases on an annual basis in the recent past in order to avoid less frequent but larger future increases,” Cain stated… “If we are to continue undertaking important infrastructure improvements, including the underground city utilities, we need to raise additional funds.”
The Boyne City Municipal Airport Board is recommending increasing daily hangar rental rates because the $20-a-night is not covering the city’s expenses.
According to the proposed budget, taxable values for properties in Boyne City are expected to decrease for yet another year, this time by .4 percent—nearly $800,000 since last year.
Boyne City’s taxable value is at its lowest point since the 2007-2008 fiscal year.
“Those values impact not only our residents and property owners, but also have a direct effect on our largest source of revenue: property taxes,” Cain stated.
“Through a combination of lower millage rates and lower taxable values, our taxpayers will be paying an estimated $18,746 less in taxes to help support the city and its services to them compared to the year before.”
He further stated, “That means that we are proposing to accomplish what we are with a projected $398,694 less in taxes to work with than we budgeted for in the 2009-2010 fiscal year.”
According to Cain, the city will actually end its current fiscal year in better financial shape than originally projected.
“Overall, Boyne City continues to fare much better than many other communities in the state and around the nation,” Cain stated.
“We have a very good workforce, one that continues to improve and serve our customers better and better each year.”