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Lansing mayor pitches $297M budget for 2025

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(The Center Square) – Lansing Mayor Andy Schor submitted a $297 million proposed budget for fiscal year 2025, a 3.6% increase from the adopted fiscal year 2024 budget.

The proposal covers July 1, 2024, through June 30, 2025, and suggests adding 15 new police officers and expanding the Advance Peace initiative, a real-time crime center analyst if the public safety revenue sharing passes the legislature and is signed into law.

Spending includes $50,000 for repairs at the Jackson Field baseball stadium as required by Major League Baseball, plus $230,000 for stadium debt service. The budget would include staff support to use federal dollars for electric vehicle charging.

The budget doesn’t touch rainy-day funds or federal American Rescue Plan Act dollars.

“I am proud to once again present a balanced, responsible budget that invests in our community,” Schor said in a statement. “Thanks to the state and federal governments, Lansing has received more than $260 Million in grants and appropriations over the past few years – and we are putting that money to work for our residents. This budget reflects much of that.”

The Schor administration received more than $2 million in spending requests from city council. The proposal is funded with property tax revenue, which is up 6.5%, state revenues sharing that increased by 2.5%, and income tax revenues, which remained flat.

Highlights include:

$9.7 million into capital improvements to major streets.$800,000 for homelessness solutions.$700,000 for sidewalk repairs.$300,000 to fund gun violence intervention through the Advance Peace initiative.$150,000 to fund a Firefighter cadet program.

The outstanding pension and other post-employment benefit obligation is $55.4 million. However, the city’s 2023 financial report says it carries $402 million of outstanding obligations- $238 million to fire and police pensions and $164 million to general city employee retirement system pensions.

As of December 2023 reports, the employee retirement system serves 1,132 people including beneficiaries while the police and fire system serves 850 people including beneficiaries.

James Hohman, director of fiscal policy at the Mackinac Center for Public Policy, says there is “no easy way” to escape pension underfunding problems.

“The city promised its employees pension benefits and did not set aside enough money to pay for them,” Hohman wrote in an email. “The city owes more to its own employees and retirees than it does to the people who willingly lent the city money.”

Lansing is implementing a plan to return to full pension funding but it will take time.

“City officials can do a lot to prevent themselves from getting further into pension debts, but they have to pay down the debts that already exist,” Hohman said.

The proposed fiscal year 2025 budget would maintain a fund balance of $20.8 million, which fulfills the city’s 12% to 15% fund balance policy.

Per the city charter, the council has until May 20 to adopt a final city budget plan for the next fiscal year. About 112,000 residents live in the city.

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