More Complete Streets & Arts Funding, New Positions, Capital Projects: A Look at the City’s 2025-26 Budget

Traverse City commissioners will take a deep dive into the city’s proposed 2025-26 budget at a 7pm study session tonight (Monday). The budget – which comes in at $88.4 million across all funds, including $25.4 million in the general fund – aims to dedicate one percent of general fund operating revenues to complete streets initiatives, boost public arts funding, add 11 new staffing positions and increase two others to full-time, and tackle several capital projects including repairing the North Union Street Bridge and upgrading city water and sewer infrastructure.

Commissioners started discussing some of their budget priorities at their May 5 meeting, when they allocated $2.385 million in surplus funds from the 2024-25 budget to different initiatives. City Treasurer/Finance Director Heidi Scheppe said the surplus funds resulted from “property tax revenues exceeding budget projections,” plus the city budgeting for full staffing levels. When some positions go unfilled, that can result in “recurring underspending, further contributing to a projected addition to the fund balance,” Scheppe wrote in a memo.

The city has a policy that it will aim to keep its fund balance around 20 percent. The goal is to maintain a healthy reserve in case of emergencies but not hoard taxpayer dollars that could otherwise be put to public use. Before commissioners voted to spend down the $2.385 million last week, the fund balance was at nearly 41 percent. The allocations helped bring that down to 31 percent. “We remain cautious regarding future obligations, particularly in staffing costs and pension liability, and will revisit projections this time next year,” Scheppe noted.

Surplus funds were allocated to various efforts including closing out a $648,000 deficit for the Senior Center reconstruction, contributing $503,000 to the separation of city and Grand Traverse County IT services, and using $242,400 to bring the city’s budget stabilization fund to $1 million. Two allocations reflect priorities commissioners hope to carry into future budgets, including the 2025-26 budget – which is set to go to a public hearing May 19 before being adopted by commissioners on June 2 (the city’s fiscal year runs from July 1-June 30).

The first allocation is dedicating one percent of general fund operating revenues to the streets capital projects fund for complete streets initiatives. “This investment is intended to enhance multimodal transportation infrastructure, improve safety, and promote accessibility throughout the city’s street network,” staff noted in the draft budget. The complete streets adjustment for last year’s budget put $236,100 in the fund, while this year it would add $253,400. Director of Advocacy Richard Robbins from the Grand Traverse Safe Streets Alliance (GTSSA) praised the allocation, saying it was “consistent with other forward-thinking cities and townships across the country who recognize how important this is for creating the ability for safe use of non-motorized transportation options.” City Commissioner Tim Werner called it a good “starting point” and an “acknowledgment that our projects will likely cost a bit more if we’re trying to make (streets) best for all users.”

Commissioners also voted to boost funding to the Traverse City Arts Commission for public art projects by $15,000 using some of last year’s surplus funds – bringing the total from $30,000 to $45,000 for 2024-25 – and will consider doubling the allocation to $60,000 in the new budget. City Commissioner Heather Shaw said the city has been allocating the same $30,000 annually since 2019 and thought it was time for an increase.

“It does seem a shame that Traverse City is allocating so little of its budget to the arts when I believe many of us up here acknowledge that we have a tourism problem that focuses on drinking and partying and that may even be damaging our cultural legacy,” she said. Shaw pointed to Grand Rapids as an example of a community that invests heavily in the arts, adding that if Traverse City did the same it could help “attract a different kind of tourism.”

Several new staffing positions are recommended to be added in the new budget, including six firefighters as part of the Traverse City Fire Department’s transition to becoming the city’s full-time ambulance provider. Staff said those hires – which will primarily be funded through the EMS millage approved by voters in 2023 – “represent the final staffing component” required for the transition. Other positions recommended for approval include a detective sergeant, a stormwater equipment operator, a GIS/IT system administrator, a forestry/parks maintenance worker, and an engineering project coordinator. Two positions – a water treatment plant operator and marina dockmaster – are recommended to be increased from part-time to full-time. Positions requested but not recommended to be added this year included a police department FOIA coordinator, a utility engineer, an asset management/GIS junior analyst, and a grant administrator/CDBG coordinator.

Over $13.7 million is allocated for capital and street improvement projects in the new budget. That includes $750,000 in repairs for the North Union Street Bridge, “the final phase in the rehabilitation of the city’s seven vehicle bridges,” according to staff. Another $200,000 is recommended to be allocated annually to citywide bridge maintenance “to support the ongoing upkeep of this critical infrastructure,” staff wrote.

Major wastewater treatment plant upgrades – including $8.2 million for primary treatment and UV disinfection improvements supported by state loans and $733,000 in city funds to combine with grant funding for a rooftop solar and battery storage project – are also in the budget. Another $425,000 is allocated for critical water systems upgrades at the Commons, a partnership project with Garfield Township. Staff also noted the city will be completing the acquisition of more Brown Bridge Quiet Area property this year, with over $3 million allocated in the budget to support the purchase of the 528-acre site. The project is funded in part by a state grant with remaining funds authorized by voters in 2023 through the Brown Bridge Trust Fund.

Commissioners tonight will also hear presentations on the Traverse City Light & Power and TC Downtown Development Authority budgets. The city is also rolling out a budget transparency dashboard – an interactive tool that allows residents to explore city revenues and expenditures per capita and to enter their own property tax amounts to see a breakdown of how much they’re contributing to public safety, road maintenance, recreation, and other services. Mayor Amy Shamroe says that while there are “always some tough choices” to make with the budget, she’s pleased with the process to date. She also says the one percent allocation to complete streets is a model that could be looked at to fund other key priorities. Commissioner Mi Stanley alluded to the same last week when she discussed committing more city resources to housing and homelessness solutions.

“If you want to look at a community's values, look at their budget,” Stanley said.

Pictured: Dedicated cycle track and signalized pedestrian crossings on Eighth Street - examples of complete streets amenities.