The commission’s second budget workshop for fiscal year 2027 revealed financial hurdles. A topic was the projected millage rates and associated deficits. A millage rate of 4.05 would result in a deficit near $1,375,000. To break even, a unanimous vote would be required to raise the millage rate to 4.8306. The absence of capital improvement projects in the general fund was a concern, with only an $8,000 fryer for sports and recreation approved as a necessary expenditure. Additionally, many city vehicles have exceeded 100,000 miles.

The commission also highlighted a lack of proposed cost-of-living adjustments for 2027, although the first year of a salary study is set to be implemented. Budget proposals included significant reductions in training and travel expenditures, with only essential funds retained for necessary training.

In a bid to cut costs, the commission is considering modifications to employee benefits. Proposed changes include reducing leave accrual, eliminating the PTO buyback program, and cutting paid holidays from 13 to 11, with potential savings estimated around $22,000. The commission has yet to decide which holidays will be cut, with options including the day after Christmas and Good Friday. Proposals to eliminate retirement and longevity bonuses and to remove benefits from part-time employees working less than 32 hours per week were also discussed.

The commission debated the adequacy of sponsorships to cover event costs, noting that all city events have been removed from the budget. Future events will rely on sponsorships obtained at least 90 days in advance, or 180 days for larger events like July 4th, due to extensive planning requirements. The July 4th event previously cost the city $126,000, with sponsorships totaling $15,750, resulting in a net cost of about $110,849.50, including approximately $43,000 in overtime expenses.

Sanitation services were another focus area, with the budget projected to finish in the red again, with a shortfall of around $490,000. Despite having no debt, sanitation operations have been depleting reserves, forecasted to drop from over $3 million to approximately $2.8 million by the fiscal year’s end. The commission discussed the possibility of rate increases to address these financial issues.

The discussion also turned to potential revenue-generating measures. One suggestion was contracting with a company for lien searches, allowing the city to earn $100 per search, with the frequency estimated at 10 to 15 searches per week. Considerations were also raised about cemetery plot sales, with the city charging $1,000 per plot in contrast to private cemeteries’ $5,000 to $7,000 rates. Increasing the sale price was suggested to help cover annual maintenance costs.

The commission is exploring outsourcing various municipal tasks, such as culvert installations and asphalt repairs, evaluating whether this could yield cost savings. Staff efficiency was also a topic of discussion, with potential furloughs and workforce reductions on the table for 2027. Health insurance costs are projected to have a zero percent increase, but restructuring plans may result in employees bearing a larger share of premiums.

As the city prepares for upcoming budgetary deadlines, including a max millage approval set for July 28 and tentative budget approval scheduled for September 8, the commission stressed the importance of making informed decisions. The legal constraints surrounding discussions of votes were acknowledged, with some frustration expressed over the inability to openly discuss preferences regarding the millage rate.

Public comments highlighted the need for a balanced approach to budget cuts, with emphasis on the disparity in funding between senior centers and youth sports programs. Community events and their budgetary impacts were also discussed, with suggestions to eliminate sponsorship for certain events as part of a broader effort to streamline expenses.