Signature Associates

We're sorry, but our site is built to take advantage of the latest web technologies that Internet Explorer 8 and below simply can't offer. Please take this opportunity to upgrade to a modern browser, like Google Chrome or Internet Explorer 11.

Contact Us


Portage approves $93M budget, plans to reassess quarterly as coronavirus affects revenue

The Portage City Council approved a $93 million budget during its Tuesday, May 26, meeting, but plans to reassess the budget quarterly as revenues change due to the coronavirus pandemic, the city manager said.

Despite the economic impact of the pandemic, the city passed a balanced budget and retained a 24% reserve in its general fund. The budget shows planned general fund expenditures totaling $28,788,371.

Those reserves total approximately $7 million, Portage City Manager Joe La Margo said.

Neither the city’s tax rate nor fees will increase in the 2020-21 fiscal year, he said.

“We’re not asking for any more money from our residents, this is not the time to ask them for money,” La Margo said. “We’re going to live within our means. We are going to tighten our belts, but at the same time make sure that the core services are not being impacted.”

The city will likely lose 40%, or $2.6 million, of revenue expected through the Act 51 program, which provides the city with state transportation funds. Additionally, an expected 50% decrease in state revenue sharing, adding up to a potential $2 million loss, is being taken into account, La Margo said.

“We’re reviewing our budgets on a quarterly basis to make sure that our expenses are not outpacing our revenues,” he said. “The nice thing about budgets is they are living, breathing documents.”

If cuts happen, they will come from the $31.4 million capital improvement fund that covers projects like the senior community center and South Westnedge Avenue road improvements.

However, it will likely be “wants” that will be cut first like adding new trails and replacing equipment in city hall rather than the “needs” like everyday services, La Margo said.

In response to the stay-at-home order, the city furloughed 42 employees across all departments. As the restrictions have let up and more services have become in demand, such as park maintenance, half of those employees have been brought back to work, La Margo said.

Unless there is another shutdown the city does not anticipate another round of furloughs, La Margo said.

“It’s the worst thing you could ask a city manager to do — to remove an individual who has done nothing wrong and who has been a productive employee,” he said.

Coronavirus has dictated cuts across the county as budgets are being mended to reflect nearly three months of depleted revenue and expected reductions from the state level.

The Kalamazoo County administrator has estimated an $1.3 million loss in revenue due to the COVID-19 pandemic.

During the Tuesday, May 19 meeting county commissioners discussed a budget reduction to make up the revenue loss. The proposed reduction cut salaries and operational costs throughout the county.

An itemized list of cuts from each department will be made public during the next meeting on June 2. The board is expected to vote at that meeting on the proposed cuts.

About 25% of the city of Kalamazoo’s workforce will work reduced hours over the next two months to help lessen the financial impact of coronavirus, the city said in a news release on Friday, May 15.

The COVID-19 pandemic is expected to cause the city of Kalamazoo a $1.2 million budget deficit, the city said. It will participate in the federal Unemployment Insurance Agency Work Share Program to save an estimated $500,000 in personnel costs, the city of Kalamazoo said.


Posted By: on May 26, 2020.  For more information, please click here to read the source article.

To receive the In The Know from Signature Associates, please click here to be added to our mailing list.

« Back to Insights