Kalamazoo’s 2016 budget tops the agenda at tonight’s city commission meeting. Despite a general-fund gap of more than two million dollars, the city says it has managed to avoid patching the hole with service cuts. But the city does plan to raise the tax that pays for bulk trash and recycling, and reduce bulk trash pickup.
WMUK’s Sehvilla Mann spoke with City Manager Jim Ritsema about this year’s budget and Kalamazoo’s fiscal health going forward.
On what next year’s budget deficit will look like
Ritsema: 2017 is the year that we’re going to see a projected deficit of close to $2 million. Now we did realize some gains with the road funding package that the state approved late last year. And for Kalamazoo that means additional monies starting in 2017 that we’ll be able to use for the roads as intended. But also be able to reduce some of our subsidies that we were providing from the general fund to roads as a result of that additional road funding.
On proposed changes to the bulk trash millage
One of the areas that we’ve really had to look at for 2016 was the solid waste millage which funds our solid waste program, which includes residential recycling, and brush pickup, bulk trash pickup, leaf pickup and the like and tree trimming. And so one of the areas we had to look at changing to generate some savings which were needed to help balance the fund was in the frequency of bulk pickup. That is done on a monthly basis.
What we’re recommending and what the commission will be approving Tuesday night is a change to bimonthly, every other month, and we anticipate rolling that out and communicating that so they’re not surprised by that by summer and so there will be time to prepare so it’s one of those things that when we bid out the – we did a recent re-bidding of the contract and we looked at what savings could be generated by going to a different frequency schedule trash pickup and the savings were fairly dramatic.
So that’s something that residents will see as a change but it’s also – will allow us to have to levy a lesser millage. We were looking at 1.9 mills [from the current rate of 1.55 mills] and we were able to get that down to 1.8 mills.
On whether the gap in the general fund is expected to widen over time
Yes, we definitely have a structural deficit in our general fund. And a lot of it goes to the way we – what revenue we rely on as a city. That revenue predominantly is the property tax. And the way it’s set up is and this was all worked out, presented through the revenue panel, based on the revenue we’re projected to receive in 2016, that’s about the same amount of property tax revenue we were getting back in 2003.
And so you can see, costs certainly have gone up since 2003. So that’s a huge problem. And another fact that we pointed out was, if you go to the pre-Great Recession property tax revenue levels, so 2007, 2006 – to get back to those levels, from where we are now is projected to take at least 15 to 20 years.
