Council approves proposed 2021 fiscal year budget, COVID-19 impacts felt

Campground among budgets hit by pandemic-forced closures

MANISTIQUE – The 2020-21 fiscal year budget for the city was approved Tuesday during an online meeting of the Manistique City Council. The city’s fiscal year ends each June 30, with the new year beginning July 1.

According to City Manager Sheila Aldrich, she and the city treasurer, Zach Sanville, working with city department heads to create the budget. She noted that most line items from the proposed budget were “pretty typical” and remain the same as the current fiscal year.

“Property tax continues to be our largest source of revenue,” Aldrich said. “As you can see, it hasn’t increased much in the past … several years. So that continues to be a little bit of a challenge.”

Aldrich explained that the constitution and statutory sales revenue sharing from the state have decreased as well.

“From the time that Zach and I were putting these (budgets) together over the last couple of weeks, just as we were about to print them … these sales constitutional … had dropped $30,000 or $35,000,” she said. “What we did to offset that … transferred from the (city’s) fund balance (in the amount of) $34,000 to cover that shortage. Hopefully, that won’t get any worse.”

According to Aldrich, the budget of the Manistique Marina will be based on the 2019-20 fiscal year budget, as construction continues and affects usage. She noted that the city has submitted an application to the state to have the marina project classified as an “emergency repair” so that construction can recommence.

The Manistique Public Safety Department budget, Aldrich explained, was allocated less for the 2020-21 fiscal year as they did not have vehicle purchase budgeted for the year. Additionally, the Manistique Department of Public Works had fewer expenses budgeted in the coming fiscal year due to the loss of an equipment payment.

In the budget for the Manistique Lakeshore Campground, Aldrich said that site reservations are forecasted to be lower due to the forced closures in May and most of June because of the COVID-19 pandemic. Additionally, the campground’s transfer to the Downtown Development Authority increased to $180,000 as the payments to the bank for the campground’s initial construction loan increased.

“We’re certainly glad that we had money in the fund balance for that and also to pay for the shoreline restoration in this year’s budget,” Aldrich explained. “Those are the reasons you see the smaller figures in the revenue. Hopefully, next year, we are back to normal.”

The water and sewer budgets for the city included increased expenses, due mostly to the city’s combined sewer overflow projects and an emergency repair on U.S. Highway 2, as well as planned water and sewer rate increases (see related story).

In the city’s recreation department budget, Aldrich noted that the early closure of the Little Bear West Arena due to the COVID-19 pandemic negatively impacted revenues.

“We’re projecting the fiscal year 2021 budget as if it will open as usual, although I have talked to people from hockey and they haven’t decided what they’re going to do about hockey yet this fall,” Aldrich said, adding that anticipated revenue from the arena may have to be amended if the pandemic continues.

Additionally, Aldrich explained that the recreation director and recreation board were apprised of the circumstances of the budget. Upon learning of the planned deficit of the budget, Aldrich said the recreation director suggested their position be cut to save the department money.

“It was suggested that, for this year, for the time being, to eliminate the position,” she said. “The Folk Fest was something that the recreation always oversaw – that’s out of the cards. The (recreation) golf outing, too. So that’s the route that we’re projecting the budget to get it through.

Otherwise, we would have been asking the general fund for a bigger transfer than we already do,” Aldrich continued. “Right now, the general fund is having a challenge themselves. I appreciated that the recreation director was willing to (step out) and made the suggestion.”

Aldrich said that other city employees would assist in covering the gaps created by the position being cut.

City council members unanimously approved the proposed 2020-21 fiscal year budget unanimously.

“This community has managed a challenging time with such resilience that it is amazing,” Aldrich said in a memo to city council members regarding the budget. “We will continue to handle what comes at us. If we are given lemons, we make lemonade.”

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