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E.L. City Council's proposed budget falls 8 percent below last year's

April 1, 2008

The East Lansing City Council is set to begin debating its 2008-09 fiscal year budget, which could mean cuts to services such as street maintenance and parks.

The council has invited the public on April 15 to critique the balanced $65 million budget, which is about 8 percent, or $5,685,255, less than the 2007-08 budget.

Proposed funding for major city streets would decrease about $700,000 and construction and maintenance project funding also would decrease more than $2 million compared to last year’s budget.

Despite the cuts, East Lansing Mayor Vic Loomis said he is happy with the budget.

“When you look at the challenges a lot of governments have when balancing a budget, we didn’t have that,” Loomis said.

East Lansing City Manager Ted Staton said the decrease in funding won’t sink the city because of five-year budget projections and steady improvements to the city’s streets. He added that the 8 percent budget decrease is deceiving because part of last year’s budget included carryover funding for city projects from the 2006-07 fiscal year.

“We don’t, in good times, spend like drunk sailors,” Staton said. “And we don’t, in bad times, have to cut essentials.”

The city is expected to receive $5,765,745 in state aid, an almost $1.5 million decrease when compared to the 2001 budget.

“Because of the subprime mortgage and the real estate crises, houses are appreciating less,” Staton said. “We have not been insulated from that, and I can’t think of anybody that has.”

Even though less funding is available for city projects and services, Staton said the city has avoided cuts in areas such as public safety.

With Michigan’s economy struggling, the state Legislature has tapped into funding for cities to fund services such as the corrections department and Medicaid, said Eric Lupher, director of local affairs for the Citizens Research Council of Michigan, a Lansing-based nonpartisan public affairs research organization.

“All the local governments have been affected by the Legislature taking this money away,” Lupher said. “We don’t think this is going to get better anytime soon.”

Some increases in the budget reflect the success of city projects, said Jim van Ravensway, East Lansing’s director of Planning and Community Development.

The budgets for two city development divisions — the Brownfield Redevelopment Authority and the Downtown Development Authority — have began capturing increased revenue, though it must be used to pay development costs. Those bodies increased revenue by $990,770.

Those bodies have helped create developments such as City Center I, van Ravensway said.

That’s because those bodies helped access the financing used for the projects, allowing the developer to skip paying property taxes on the projects, van Ravensway said.

“Its got more people living downtown and is spurring development of City Center II,” van Ravensway said.

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