Traverse City commissioners will hold a series of back-to-back meetings tonight tackling several subjects, including the new proposed 2026-27 budget – which City Manager Benjamin Marentette said is a “first” for being tied to a strategic action plan – and the retirement of Deputy City Manager Deb Allen. The board will also approve a set of “shared agreements” outlining how commissioners plan to work with each other and staff going forward.

Budget
Marentette will present the city’s draft 2026-27 budget at a study session tonight, which he told commissioners last week “for the first time in Traverse City’s history…is based on a community-driven strategic action plan (SAP).”

The budget projects $111.6 million in revenues in the city’s next fiscal year, which starts July 1 and runs through June 30. Enterprise funds – or those that are self-sustaining through fees, like sewer and parking funds – represent over 41 percent of that pie. The general fund is about 24 percent at nearly $27 million.

Marentette’s budget reflects several “pillars” supported by residents in the city’s recently adopted SAP, allocating funds to projects that align with community priorities. For example, one percent of the city’s general fund is allocated to complete streets, supporting the pillar “proactively manage urban design.” Other projects like mobility improvements to the Union/Seventh intersection, a Sixteenth/Cass pedestrian crosswalk, and reconstruction design for Seventh Street also fall under that pillar.

Another pillar is “strengthen placemaking and neighborhood character.” The proposed budget lists projects like sidewalk infill on Garfield Avenue, a Hickory Hills mountain bike trail, East Side Social District improvements, and a TC “Vibes Council” that will help brainstorm creative placemaking efforts throughout the city. Under the pillar “support environmental sustainability,” investments like wastewater modernization, a Boardman River wall study, green fleet investments, and lakeshore restoration are included.

Marentette is also proposing allocating one percent of the city’s general fund toward housing and homelessness initiatives over the next three years. That equals about $260,000 this coming year, though the city manager noted that over $525,000 is budgeted in 2026-27 to support a variety of critical services – including funding for Safe Harbor and outreach and day shelter services. The city is also in the process of implementing a five-year plan for federal Community Development Block Grant (CDBG) funding, which goes toward housing initiatives. Immediately prior to tonight’s study session, commissioners will have a special meeting at 7pm at which they’ll adopt the CDBG plan for 2026-27. That plan includes over $370,000 in spending next year on categories like rental assistance, rehabilitation of units, and homelessness services.

The draft budget forecasts ahead to the next two fiscal years – another new strategic effort, according to Marentette. His presentation notes that “ongoing cost pressures require disciplined, long-term planning” with an “intentional use of fund balance” and “continued focus” on aligning project priorities with the SAP. Commissioners plan to have more discussion in September about the city’s growing fund balance and how to spend it down strategically. In the meantime, the upcoming budget will put $1.2 million toward the city’s pension debt and $500,000 toward budget stabilization from that fund balance, which currently sits just below $9 million.

Personnel is the single largest cost in the city’s overall budget at over $30 million. The number of city employees has grown from 152 in 2016-17 to 198.5 today. No new employee positions are proposed in the new budget, though several previously discussed positions – like new TC Fire Department staff to support an expansion into ambulance services – are included. Some staffing resources are also being “reallocated” to meet operational needs, Marentette said. For instance, commissioners have decided to hire a law firm to replace City Attorney Lauren Trible-Laucht when she departs in June rather than hiring another full-time staff attorney.

A competitive labor market, retention challenges, upcoming retirements, and workforce transitions are all pressure points, according to Marentette. As an example, Deputy City Manager Deb Allen has just announced her retirement effective June 12. At their special meeting prior to the budget study session, commissioners will consider adjusting the city’s pay scale to add a new level that would result in higher potential salaries for the deputy city manager, police chief, and fire chief. That adjustment will help “strengthen” recruitment efforts for key leadership positions, with the city planning to begin recruiting soon for the “critical role” of deputy city manager, Marentette said.

Traverse City Light & Power and the TC Downtown Development Authority will also present their budgets tonight as component units of government of the city. Commissioners could vote as soon as May 18 to adopt all three budgets and must do so by June 2 under the city charter.

Shared Agreements
Commissioners will gather at 5pm tonight at the Traverse City Senior Center prior to their 7pm Governmental Center meetings to review and adopt a set of “shared agreements” they’ve been developing in recent months at several off-campus public meetings.

The agreements establish a “clear framework for effective governance,” according to Marentette, outlining how commissioners will work with each other and staff. Examples including clearly communicating expectations, respecting the majority decision of the board (while still recognizing individual expression and reasoning), listening openly and with good intent, explaining the rationale behind decisions whenever possible, and treating staff as trusted professionals – including separating “policy disagreements from judgments about staff competence.”

Clarification requests from commissioners on agenda items that would require more than 15 minutes of staff time to address will now require three commissioners asking for that information. “If a request would require significant staff time, it may be brought to the full commission to determine whether there is shared interest before moving forward,” the policy states. “This helps ensure staff work reflects commission priorities as a whole.” Marentette thanked commissioners for their help in developing the agreements, saying their work is “already drawing interest as a model from leaders across Michigan and beyond.”