REED CITY - The Reed City city council adopted a budget and appropriations resolution for fiscal year 2020-21 at its meeting May 14.

The budget appropriates total expenditures of $5,595,287, with general fund expenditures of $1,514,010.

City Treasurer Barbara Westerberg told the council that the proposed budget was a balanced budget without using additional revenue from the reserve fund balance.

Some council members expressed concern about an additional $1 million dollars in spending for fiscal year 2020-21.

"The additional spending is for projects that are ongoing," City manager Ron Howell said. "Those will be paid for with revenues within those funds, where we have built up cash reserves.

"We are using cash we have on hand instead of borrowing, and that's a good thing," he continued. "We will also be looking at possible grant funds that might be available. If we get the grants, those funds will be added in."

Westerburg told the council that the city is required to do certain projects, including replacing sewer lines and capital improvements to the city sewer and water systems.

"Those have to be funded," Westerburg said. "That $1 million dollars is in the water and sewer fund that is paid for by the system. We are required to replace service lines, and we are required to replace the south water treatment plant, and that comes at a cost. In addition, we have the $400,000 cost for painting the water tower."

Looking at the increase in the general fund expenditures over last year, it is only a difference of about $27,000, Westerburg added.

In addition to the budget proposal, the city council approved a resolution to authorize the levy of 14.3236 mills on real and personal property within the city for municipal operating purposes, and a levy of .7 mills for the Fire Department Building Debt Service Fund.

Mayor Trevor Guiles commended the staff for bringing the budget into balance without using money from the reserve fund.

"It's nice to see no fund reserves in there, but that will depend on whether the state comes through with their funding," he said.

The budget proposal may be viewed at the city website, reedcity.org.