Budget promises investments

By: Eric Czarnik | Sterling Heights Sentry | Published May 9, 2016

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STERLING HEIGHTS — Sterling Heights city officials say the newly passed 2016-17 budget will allow the city to follow its long-term plans.

The Sterling Heights City Council unanimously approved the proposed and amended 2016-17 budget during a May 4 council meeting. The 2016-17 fiscal year starts in July.

According to the city, the overall proposed budget is for around $170 million. Sterling Heights Finance and Budget Director Brian Baker said the total budget decreased by about $7.8 million, or 4.4 percent, compared to the previous year.

The general fund increased by about 0.6 percent, coming out to about $92.1 million, according to a budget summary.

“In terms of our future, the budget increases reserves and continues to follow the city’s long-term financial plan and fully funds long-term liabilities and realizes savings now for the first time,” Baker said.

As tabulated in the city’s budget charts, for the 2016-17 budget, the city listed its spending to be $170 million. In comparison, total expenditures were listed as $177.9 million in the 2015-16 budget column.

Meanwhile, in a year-end unappropriated fund balance comparison chart, the city anticipates that a total of about $19.2 million will be in its fund balance for the 2016-17 budget, and the fund balance was listed at $12.4 million under the 2015-16 budget column.

City officials said some cost savings came from eliminating retiree medical benefits for new hires. In terms of spending, the city expects to fund more capital investment in public safety and public works vehicles. It also aims to proceed with repairs of neighborhood and major roads.

The city also hopes to restore some job positions to full time and continue hiring new police officers, Baker said.

“In terms of taxes next year, we have the same low tax rate in the budget as we did last year. … Taxable values went up only the rate of inflation last year, and that was only 0.3 percent. … As a result, average tax bills remain $200.”

During two April workshops, the City Council reviewed the budget and was allowed to make amendments. For instance, amendments took into account items such as federal Community Development Block Grant funds, as well as savings from the new waste-hauling contract with Rizzo Environmental Services, officials said.

Sterling Heights resident Jeff Norgrove said he wanted to know whether, in the future, the Historical Commission could get some money for the Upton House and period furniture. He also wondered how much money was starting to be set aside for the city’s planned 50th anniversary celebration in 2018.

“That would be a lot of fun if it was a whole summerlong event, where we can combine everything in Dodge Park, the parades, and maybe we can even get a band that was popular in 1968 to come play,” he said.

Resident Harry Marchlones wanted to know whether the city was cutting back on anything — such as police, fire or roads — in order to get something else.

“Because the layperson like myself, we could read this (budget) all day long, and it won’t give us the information that we’d like to have,” he said.

After the meeting, Baker responded to Marchlones’ concern and explained to the Sentry that the city is continuing to increase capital reinvestment in roads, equipment and vehicles.

“There were no cuts in terms of staffing. The council approved ... additional full-time positions,” he said. “We have a budget for 18 new hires for police as people retire, so we’re advance-funding 18 additional officers to prepare for future retirements.”

During the meeting, Councilwoman Barbara Ziarko asked the city to explain a bond rating drop. Baker said three ratings agencies rate the city’s bond rating: Fitch Ratings, Moody’s Investors Service and Standard & Poor’s Financial Services.

“I think there’s, give or take, 20 different bond ratings. We’re the second-highest (bond rating) in two of them, and S & P dropped us from second- to third-highest,” he explained.

Baker attributed the drop to the agency using different criteria, particularly over legacy costs. He also said, “The community is just getting a little bit older, and they’re comparing us now to a little bit more older-type communities.”

Learn more about Sterling Heights by visiting www.sterling-heights.net or by calling (586) 446-2489.

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