BATTLE CREEK, MI (WKZO AM/FM) — The COVID-19 pandemic has not only impacted household finances, but a growing number of cities are being forced to make difficult decisions as tax revenue falls short of projections.
The City of Battle Creek has announced that it is facing $839,178 more in expenditures compared to revenue during the current budget year as sales tax and city income revenue decline because of business shutdowns along with mass layoffs.
Next year the situation continues to look difficult for the city, with estimates showing a $4.9 million deficit if the economy fails to rebound.
A special budget workshop is scheduled by the city commission on May 7th to discuss the financial issues and plan for how the city moves ahead.
One measure that has already been announced is the furloughing of 95 city employees beginning in May and continuing into June.
Battle Creek’s general fund partially relies on income tax revenue to pay for daily operating expenses in the city and fund the salaries and benefits of city employees. The estimated decline in income tax revenue by $3.4 million has led leaders to consider temporary layoffs as a potential cost-saving measure.
The furloughs will be evaluated on a month-to-month basis depending on the financial and service needs of the city, and could possibly be extended into July.
Pay cuts for high and intermediate level officials in Battle Creek are also being implemented to address the budget shortfall. The city manager, assistant city manager, city attorney, and 12 department heads and division managers will take a 3% pay cut from May through July.
“There is no question that these are tough decisions, and we will continue discussing these issues for the foreseeable future as Battle Creek, and communities across the country, continue serving our communities during the challenges the pandemic presents,” said City Manager Rebecca Fleury.
City officials are seeking additional federal and state funding resources to restore the local economy and minimize the effects of the budget gap.
The city commission budget meeting is scheduled for 6 p.m. on Thursday, May 7th, and will take place remotely due to the stay-at-home order and health guidelines.
Residents can watch the meeting through the city’s Facebook page or via a live broadcast on the AccessVision cable channel.
