Village Council Work Session and Meeting - August 11, 2026

0:15 We're good to go. >> Let's start roller. Ryan >> here. >> Wendell >> here. >> Winebrunner >> here. >> Cole >> here. >> Costco. >> Brandon >> here. We have a quum. I'll entertain a motion to >> excuse. >> You can just do it. You can just excuse them. It's just a work session. >> So before we get started, I'd like to offer public related

1:03 session. >> All right. And I'm actually the microphone over to you guys, too. So, if you guys question those questions, your mic's on. >> Okay. >> So, good evening. Um, welcome. Thank you

1:50 for having me here. And I'm sorry I'm talking a little bit to your backs, but we'll mostly be looking at the screen. U and and then when we get to Q&A, we might move things around if if that's more comfortable. What we've done and we go to the next slide then. Um just a recap of what this project was. We did build a 20-year model of all the village funds. It's an Excel spreadsheet that the village will have to use. We included the water and sewer rate analysis, which we'll talk a little bit about tonight as well. uh looked into the inputs for cityhood um and what that might look like uh including the road miles, population trends, values and whatnot and then additional costs of what it might be to to run as a city. Uh

2:36 we met with staff multiple times, reviewed a lot of data and then ran quite a few different scenarios to see what might be options and viable. So bottom line is Unfortunately, there are no easy answers. No silver bullets. No. Gee, we just overlooked something. Um, there's a lot here. >> I'm sorry. >> I'm gonna >> move this closer. I don't know if >> And I can turn it up too as you're talking. >> Keep going. I'm gonna adjust. >> Okay. Um we I think the village needs some additional policy direction and revenue enhancements to really understand where things are going uh and what's viable.

3:24 We didn't find any obvious signs of wasteful spending. Um in fact you might be underst staffed. This village operates quite lean as far as a municipal government providing all the services that you do. I'm sure you know there are significant capital needs and infrastructure needs across all operations of the village. Um it makes it hard to know where to start and where to focus. Um there are some opportunities for improvement. They won't be easy. Funding is the challenge. So revenue uh to pay for things is the challenge. And I think there's opportunities that need to just start taking action now. So continuing to defer is not going to solve any problems.

4:11 So I'll start with the general fund, the the most important fund and and handles the most in the village. Overall, you're still in a weak position. Um without the public safety assessment, you would be about $700,000 worse off than you are now. Uh in other words, you would be bankrupt. Um the model that we have currently includes about $230,000 a year in capital investments in the general fund. Uh that's just a number that we put in there based on some rough estimates. We looked at um other revenues and they're going to increase a little bit primarily property taxes and state shared revenue. Um looked at the assumptions um in terms of where things

4:57 are going costwise. did our best to estimate future growth in costs and that's primarily inflationary increases. Uh no real additional increases in staffing or added services. Right now with this forecast, you might be able to go another 10 years without true crisis in the general fund, but you are very close to the edge. uh overall if we reduce that capital spending from the 230,000 to 160,000 we get better stability but it still doesn't solve all the problems because then you're not addressing needs. Uh so that's the trade-off. It's another way of deferring. Again it goes back to revenue is the issue. Um how do we generate revenue to

5:45 ensure some financial stability for the village? And the action that one could take here is seek some additional funding, uh, voter approval, special millage, um, headley override, whatever that might take to address some of the general fund needs. So the top left forecast, uh, you don't have to see all the detail there, but the trend line is that solid black line that's kind of hovering near the bottom of the chart is your fund balance, projected fund balance going forward. that very low point uh was last year. And what we're looking at again is that 10 years from now, that fund balance goes negative. Um on that bottom right chart, if we change that $230,000

6:31 capital spending to $ 160,000, we get another 10 years um with where things are going. Now, this assumes that the special assessment for public safety continues in all of those years. major streets. Um, your revenues are fine for just maintaining basic operations, plowing and whatnot. Um, it does not have enough resources in that fund to fix the roads. Um, there's old data that we're working with. The last study, 2016 Paser study, identified about eight and a half million dollars in improvements over a 10-year period. Those have not been done. This is 10

7:18 years later. Um, so now we're looking at how do we fund this? The $8.5 million from 10 years ago uh is definitely not $8.5 million today. One thing, the cost of materials has gone up substantially over the last 10 years. And at the same time, the condition of the streets has deteriorated further, which means every mile requires more work. Whereas before, we might have just been able to do some um mill and fill, as they say. Um you're now going to be required to actually go and replace some road base, which is a much more expensive option. Uh so what the council could do is ask for voter approval of a street mill, um a debt or a special levy, uh to fund improvements.

8:04 And I have a note there about two and a half mills would fund a 15-year $8.5 million levy for street improvements on the major street side. On the local streets, and I know council's aware of this, but for the public that doesn't know, uh there are different classifications of roads in Michigan and the village has what are called major streets. Uh and then there are local streets and the locals are more the neighborhood streets, the smaller side streets, whereas the major are the through streets and the improvements on those are also uh quite high. Again, 10 years ago it was $5 million. Um not a lot has been done there. So if we're looking at a $5 million bond, uh that would be about 2.3

8:50 mills to to fund that over 15 years. that does not fix all of the roads. I just want to make that very clear. Um, you would have the debt for 15 years, but you would also have roads that are not improved. So, additional funding is needed. You could get an infusion of cash with the bond and do some of the worst streets uh and make some improvements or preserve the ones that are still holding on. Uh, but beyond that, you're going to have to find additional revenue. And again, voter millage uh debt or special levy could work. solid waste fund. Nothing exciting here except you um collecting a little bit less than what the actual costs are. So, a small tweak in the the garbage um

9:36 search charge would be enough to fix that. That just means the general fund doesn't have to subsidize uh the solid waste fund. You can't have a negative fund balance. Go ahead. Water and sewer. Um overall the village has not been particularly aggressive in raising rates. In fact, they've been almost stagnant or gone down for the last 10 or 15 years. Um and there's a lot that needs to be done on the water and sewer uh infrastructure. Fortunately, you have some debt that's about to come off. Um trying to figure out how to maintain rates as low as possible. We look for opportunities like debt that's being paid off as an

10:23 opportunity to either issue more debt or just take that cash and start spending it on more improvements. What we've included in here on the water side, um about $7.8 million in capital and then about $ 8.1 million on the sewer side over the next five years. Uh pretty substantial investment. Some of that would be paid with cash, some of that would be paid out of debt. Um, again trying to keep the rates as low as possible. So the action there I would suggest is to actually put together a plan to identify where the village could spend that money specifically. We know it can work financially, but we need the projects identified so the engineers can start actually laying them out and planning for them.

11:09 The other issue with the water and sewer is your customers that are outside of the village are paying the same as customers inside the village. And this is not a recommended approach. Um the agreements that were made with the developers uh for those areas outside of the the village years and years ago uh said the village would charge the same rates for a certain number of years. That time has passed. Um, so it's time to start looking at what the rate should be for customers outside of the village. The reason it makes sense is customers outside of the village carry zero of the risk of the utility system. So if something catastrophic were to happen and the judge came in and and issued a

11:56 judgment and said you have to raise taxes to pay for this, only the village taxpayers would pay for that. Nobody in the township would be responsible for that. So part of the issue is you are taking on a substantial risk to service customers outside of the village. Um so that's a big part of what we're trying to do. You're investing it. You're issuing the debt. You're taking on the risk for that. If we were to do a complex um cost of service utility study um we would look at that in more detail and identify the exact assets that are being served and what proportion is being served out there. Overall they are getting a deal right now. Um and it's time to probably change that.

12:41 Also you like I said before rates have not increased. um we are looking at based on the numbers that I just shared um primarily on the capital side increases that would be steady year-over-year increases and I will point out that this chart assumes the status quo uh where customers outside the village pay the same as customers inside the village. If we change that and apply a 150% search charge to um customers outside, so they'd pay one and a half times the rate that the village pays. That first year there um it would be for the typical residential, they'd see a slight decrease of about 2.9% in their bill. Um and that's just

13:27 because now we're taking some of those costs and shifting them to outside customers and recovering more revenue from them. These also assume that the village would switch from a flat fee for your fixed or base charge to a meter-based base charge. Um, so the customers that have a larger meter pay a higher base charge. Again, that is consistent with best practices in the industry. Larger customers put more demand on the system and that fixed charge is recovering the system costs the fixed asset costs the maintenance cost the capital investment for that system. Uh so larger larger customers require a larger system require everything to be working uh at a higher level. So more of the costs

14:13 appropriately should be shared with them looking at the cash reserves. So what we try to do in when we're looking at water and sewer rates is kind of balance what people are paying with through their rates and and the amount of cash that we're have holding on hand. So here we're hold we're seeing that on the water side we're pulling water rate or cash down um gradually over time on the sewer side on the bottom right um even more. We're trying to keep that green bar close to that black line. Um, and we're going to spend down the cash to smooth out the rates. On the sewer side, go even more aggressively to make that happen. We try

14:58 to get cash down to a point that's at a reasonable level and then maintain it there. Every now and then, we might add a little more cash because we know there's a project coming up. Uh, or we might use a little more cash because we know that we have a project to spend money on. and it's a one-time deal. We'll spend the money and not raise rates as much and then the next year we'll start recouping some of that. So, we are trying to maintain cash at a at an appropriate level through the forecast. This is just an illustration of the capital. Um on the water side, you can see there's a pretty substantial uh debt issue. That's that orange bar. and that would be to take on whatever projects were identified um on that utility so

15:43 that you can make a substantial investment all at once. Um the blue bars are cash capital. Um so on the sewer side we're not anticipating any new debt but just consistently spending cash uh on that. Again, back to the outside customers. Um, they are currently paying a different rate. Um, and there is this chart in here that, um, shows that 2.9% decrease for a typical residential customer if you go with 150%. And that was a number that I just used to test things. Um, I think that's a conversation that the the village should have and make a change as soon as possible um, so that village residents

16:28 are somewhat protected. um and compensated for the risk that they're taking on to carry the system all the way out to the township. Then we looked at cityhood as an option. Um and I will say and it's it's in here later as well. Um this is not a quick process. This takes years to go through. Um so what we're looking at right now is what is being contemplated is a pretty substantial annexation. um this would be larger than any that I could find a record of uh in recent history if the proposed areas of annexation would be included and that's obviously a lot to be determined yet the population could increase by about 43% um if you annex those areas of the

17:15 township into a future city plus you um taxable value would increase about 67% so you have a substantially higher tax base you would have about 94% % road miles to maintain. Um so that's another issue to consider. Um there is the question about whether some of those road segments would remain in county control and that would have to be a conversation with the county. Um and then there are some private roads that might remain private as well. So, if you were to um change from village to city status, um you would have some increase in costs. Your clerk treasurer, you'd probably have to have two separate positions for that to

18:01 handle the added work. Um that position is already uh doing quite a bit. That's one area of underst staffing that we identified. Fire because you'd be servicing a larger area that would increase uh staffing there. public works also because you'd be maintaining a lot more area uh primarily roads and some of those roads are dirt roads uh which requires additional equipment. Um so also assessing as a city you would be responsible for assessing and elections. Um so there' be some added cost there. the assessing contract um would add um it's it's not a substantial amount but we have to fact the issues are actually identifying the exact boundaries that you're going to take to the boundary

18:47 commission understanding all the detail complexities legal and whatnot um if that committee is formed and they come back and say we don't recommend cityhood well there you have an answer um if they come back and say we think it could be done under these conditions then you have a decision to make but that response would not happen immediately. It would take a long time to do all that work. Um so again taking action now and just starting the process doesn't commit anybody to anything other than actually starting to explore it formally. So next steps um I think we need a

19:32 policy framework for identifying your infrastructure investments. In other words, a capital improvement plan um and from the council some direction on what are the priorities of the village and and you're going to be starting a master plan process soon that can help with that to identify how important are parks relative to roads, relative to police and fire stations, etc. Um, so you want to get all that laid out and identify your priorities which will then help identify where you're going to spend money. There's also once you have all that together, you can identify opportunities for maximizing your resources, leveraging dollars um in in water and sewer and streets, for example. We never

20:19 want to tear up a road to fix water um or to we don't want to replace a road and then two years later tear it up to replace the water and sewer under it. So having all that information coordinated helps a lot with saving money and getting things done. And then some direction from council on when should the village take on debt. Um when should it consider raising taxes or asking voters to raise taxes. Uh these are important policy questions that will help the staff and then help the citizens understand where the village is trying to go and again that feeds into the capital improvement plan. Um we would suggest focusing on water, sewer, streets and general fund. Uh those are your primary

21:05 funds uh for capital items. the 2019 sanitary sewer assessment um master plan or or management plan. That was something that was provided as part of the SAW grant uh way back when. Um that's a good place to start. You have some actual projects. You have actual conditions of sewer segments, manholes. Um so that's a great place to start. Um and then move on to water. Uh and then streets as well. And then obviously adjusting water and sewer rates. The sooner you do that, the better. Um, I tell everybody that I work with in this area that if you defer on raising rates, it just means the next year has to be even more. So, there's really no point

21:50 in kicking the can down the road when you know things have to be done. and then looking at uh rates that are different for the outside customers, the those customers in the township area. Uh starting the cityhood exploration process, as I said, um doesn't commit you to anything other than a better understanding of what your options are and what you're trying to get out of that. Uh we have a framework started on the financial side uh that could be expanded as more information is gathered and more decisions are made. Uh but right now we're still kind of guessing about boundaries and property values and everything like that. Um and again cityhood is not a guaranteed best option here. This is something to look at and

22:36 consider and really understand it before deciding to move forward with it. And obviously even if the council decides and the administration decides this is a good idea, it goes to the voters who finally decide. Uh so whatever actions council is taking is really just moving things forward to eventually get the voters input uh through an actual vote. Consider looking at some uh special levies for the general fund. Um looking at road millillage uh those are the key areas for potential taxation issues. These are not whimsical, you know, wishlist type projects that we're looking at. As everybody knows, the roads are in pretty poor condition. I

23:24 can tell you if you didn't know, they won't get better on their own. Um, just you have to start spending the money to make them better. And unfortunately, it's a pretty big task to to undertake. Um, improving financial transparency, I think that's critical. I've heard that um people really like governments that are transparent and the tool that we put together helps with that. So showing all this information on a public setting helps people understand where things are going. There's nothing to hide here. It is complex and it is difficult and it is not pretty to look at. Um but difficult decisions have to be made sometimes and that's what we're trying to do is is provide you the information to make those decisions. And I would just say

24:09 don't let the number of challenges sorry >> that's okay lead to decision paralysis. Um I think that's what I've seen here in talking to people is it's just we don't know what to do. It's hard to know where to go. You need to just start taking steps forward. I've outlined some possible action items right there um that give you some direct here's what you can do now. Um so with that I will stop and be prepared to answer questions. Council, if you feel more comfortable, probably at this time you can move we can move you behind the desk and then at 6 we can uh get rid of the tables and everything. >> Yeah. So our face

25:33 Make sure your mics are on.

26:19 Okay, council, who's got questions? I can, if you want. Uh, I can start off with just going over some of the action items, kind of see explain where we are and some of those steps currently if that helps out at all. I go back through this the presentation at all. Switch actually the camera for at home back to us now. Doing a few jobs tonight, too. So, all right. So, let's go through this a little bit.

27:06 All right. In the last meeting, we did talk about uh doing a street village, a road millillage. I think that we decided um if we were to have to get the language approved and all of that would had to be by today by August 11th to get it on the November ballot. We decided that was going to be um without having all the information. Uh there was a lot of concern with um you know doing a millillage at two at two mills although it's a start but the expectations we were worried that people would see that we had a road village and expect everything to change but as we saw that even with that uh the two mills it was 8 million after 10 or 15 years which is that gets us a quarter of the projects we need done and the roads are still you know deteriorating that term during that time. So, we wanted to look at a really

27:52 comprehensive view of what was actually needed in order to do that. We talked about maybe doing that in an uh doing a special election perhaps for that. That's just kind of where we were last seated on the local and major roads millillage discussion. Um the the solid waste fund we did increase slightly just to we're trying to um we're trying to just get that exactly right. We're not trying to overcharge people. We're trying to get that number. We did increase it by a very little bit in this last budget uh cycle. Uh we think it's pretty darn close right now, but we will still continue to fine-tune that number. The water and sewer. So, the finance committee has been meeting on this item uh many times over the last six months

28:37 to a year um to we've started working with CLAN. We've now been working with M municipal analytics on this. We actually have a based on the information that um they have provided us, we've now drafted some uh resolutions. It's like this might be the recommendation we want to go with. There are a few the recommendation to council. Um there are a few last items that the finance committee wants to see implemented in that that we're really having to hammer down um getting an getting the right thing. We're hoping that we can get a a final thing done that's going to be presented to council at next month's meeting at the September meeting. We've talked about if we do any rate changes or implementation not to do it perhaps within the uh immediately so it's not in

29:24 the the highest use season getting people all mentally prepared and ready for it. And so perhaps having it like start on the February bills which would be the January cycle. So start in the new calendar year. That's just one recommendation that we've been looking at. perhaps doing in order to make it a little more palatable for people when it's in a lower use season and get them used to any changes. Uh, yep. the same thing that we just discussed right there on that. And that also would include uh any of the recommendations based on uh the uh increasing to non uh non-village residents and we are looking at what that

30:11 appropriate number would be and it has to be justified by what that actual cost. And so that's what we're uh figuring out those numbers right now. The city hood the action action item on that is actually the exploratory committee is on the agenda tonight. We there's one that we had previously looked at and uh the village president asked to put it back on the agenda to do exactly what we're talking about right here. Right here with specific timelines and goals annotated on it. So we have let's go back to this policy framework. Yep. are we're in the master plan. We need to redo our master plan this year. We've talked to Ro about it. I think we should probably because Ro has done our previous one, we might want to put that out for an RFP to maybe get

30:57 a different outside look from so we can get maybe uh different eyes on our master plan. Uh so that master plan and that CIP can actually inform what we do. I think the master plan when I first started here uh or a year and a half ago I asked a lot of questions about the master plan about you know you know I've read the master plan this this and I realized quickly that it was never used to inform our decisions. It was a check the block thing and it really should be kind of our roadmap how we want to move forward when we're looking at future land use. It should actually inform how we actually want there should be a goal to change our current land use and the future land use and those kind of things. So we are we are due for a new master plan this year and so we are um looking at who the appropriate u contract the agency would be to uh take us forward with that

31:44 capital improvement plan. That's so exactly what um John was talking about. Danny and I have been looking at not only our 2016 pacer study but also the saw work that we had done. It didn't do the whole village for sanitary water sewer and we're not going road by road but segment of road by road and pairing up. All right, this this infrastructure needs to be uh done here the below the road. This is the road that needs to be done and trying to rack and stack prioritize all of the different roads within the community and that's just for the roads project. And so um that has been uh pretty timeconuming just in that aspect of it. Not to mention, we are also looking at all of the things that we need to improve with our our wastewater treatment plant, our water treatment plant, all of these things to improve. When we had those major uh floods in April, um that we had so much

32:32 infiltration into our system, if we had if our system was closed, a perfect system would be closed, it wouldn't really affected us much. Our system, we run about 650,000 gallons a day. We could push up to 2 million if needed. At that time we were pushing six to eight million gallons a day because there's so much infiltration into our system and we're having to use our back tanks to to fill up and you know kind of playing a shell game with all the excess water coming in uh in order to maintain the systems appropriately and that's where we saw a lot of that damage. So we're actually looking right now to get um some engineering done to determine what is the best way to do that. We're working with MWRMA which is the Michigan Water Resource Associate something like that. um they can help us with some of those things. We're already a member, so

33:18 with smoke testing and those things to determine where that infiltration of the system is. Also, just system improvements overall. You're going to see that Danny has a lot of new business items today. Some of that's covering some of these things. Um just water and sewer rates, we already talked about that. Cityhood exploration, we talked about that. We have not ever talked about a general fund special levy. We talked road millillage and financial transparency. You know, if there's any other um recommendations that we we have from the public or council is how we can do this better. We do our we post our our checkbook every month under on our agenda. Literally every single item that we spend money on. Um we have our budget. We obviously have long budget

34:04 work sessions that are available to the public as well as we do any of our investments and all that is public knowledge that we quarterly post and present. And so that's kind of where we're we are sitting as a staff. And so now um if you guys have any questions for John, >> um before we turn it over to council, I think I'd like to offer public comment one more time so that if council wants to address any of the public comments, we can do that. Oh, public comment. Any questions? >> Cherylyn, >> say thank you. >> Well, that's not a question, but thank you. >> Thank you. This has been a long time coming, and this is money that I think we've invested very well, and thank you

34:49 >> to the public. Cherylyn Everly said, "Thank you." >> There's a question though. So, thank you. >> We're just questioning. >> Is there any further public comment? >> Hearing none. seen on council. >> I I know you kept referencing the 2.9, but realistically like the numbers that you had on there 2.9 plus 2.3 for local roads. So, we're looking at probably like five mills that we want to raise for taxes. >> That that was illustration only. You have to figure out what you want to improve and then what the costs are. And so when we've done just a brief analysis based on the 2018 2019 numbers for roads alone um with inflation and all the things that we've seen obviously the prices have not just doubled I mean

35:36 in many ways. So we're looking at probably $20 million worth of road improvements that are needed in the village right now. Uh and that doesn't include any of the you know any future deterioration and all of that. If we were to just tackle the roads, the ADA improvements, those kinds of things that we'd have to do going in, that doesn't include um the water and sew, the water sewer underneath. Is that >> That's correct. Yes. >> Just and follow up, just one last question. I know um you're talking about doing like these different studies and stuff. Can we potentially use that study from 2023 from January that we talked about in the finance committee where row did we were potentially trying to go for grants and stuff for the Michigan Clean Waters Act, but that fell through. Is that going to help kind of leverage

36:22 some of our ideas too because we have already pinpointed those things in terms of a capital improvement? >> Yeah, we've got I've got a um I've tried to collect all of the data I can for every different aspect. I've got, you know, next to my desk I have just a pile of just that's just related to capital improvements that we're going through item by item. But it is just a laborious task because it's, you know, for a lot of this I mean on you know police fire side it's a little easier but uh Danny's side has so much as you've seen how the water manes are breaking and things like so much of that is um uh he has so much infrastructure that we need to look at right now >> because that was just a That was about $20 million in repairs that we had for

37:07 that study and that was three years ago. So >> in the water and sewer findings thing you mentioned to add cash. How would we add cash to that? >> Well, right now your cash balances are actually quite good, which is why we're going to spend that cash down. So, the way that the cash works is right now we're saying let's I want to go back a couple slides. See the cash balance? >> Yep. They just add it >> page 11. >> That. >> Yep. That one. >> That one. Yep. >> Nope.

37:53 >> That one. There we go. Okay. >> There's multiple different tabs. Um, so you can see right now we are in fiscal 27. Um, so your cash balance at that ended 26 on the water side is quite good. Um, and on the sewer side we're probably close to where we want to be. Um, the issue here is to keep the rates down. We spend the cash down. also spending money on capital. Your cash will go back up if you defer a project or if you get the engineering done and you put it out to bid and then you know you just don't get everything back in time but your rates are going up. You're still going to cash

38:39 you're going to collect the money. It's going to sit in the bank until you actually move forward with that. So the cash is going to go up and down. The idea is to try to always project forward so we know that we're not building up too much cash and if we start to gain excess cash we say okay should we kind of pull back on rates or is there another project that we should just tick off the list and and be done with it and spend that cash. So given how water and sewer works if we have a dry summer people use more water. That's just how it works. So we are anticipating a certain level or volume of water being sold. If you have a really dry hot summer, people use more, your cash goes up. That just means that you've got a little bit next year that again you

39:26 bring the rates down a little bit or not increase them as much or you spend a little bit more on capital. If you have a wet year, you're going to get less revenue. So your cash is going to go down. It's all you're constantly balancing back and forth as you look at every year's budget trying to understand where you're at. The forecasting tool helps with that. So, we can say, "Yeah, even if things are, you know, wet and cold and and people aren't using much on the water side, we're fine. You've got enough cash to get through." Sewer side gets a little scary out in that last year. But again, this is a 20-year model. I'm just showing you five years here. So, when we get beyond that, things start to pick up again. Um, so we're looking further out than what you're seeing here, trying to balance

40:12 the cash and the rates and the capital investment all at the same time. >> John, where you also mentioned that and I think what uh council member Wendell might be uh referencing is when you were talking about um the bonds and then when the bonds fall off. >> Yes. >> You were talking about um our ready to serve. >> So Tim, can you make sure to use your mic? That is something I get a lot of feedback on especially for this. Thank you. >> All right. and our on our ready to serve uh our ready to serve uh or our sewer bond debts that we used to call it ready to serve now we in the past were we were having to supplement into that so to a tune of what did we say 150,000 at least a year that we would have to pay to cover those bond debts every single year and so now that some of them are eventually falling off we're getting closer to even on that when more fall

41:00 off and we are now at a potentially a surplus what he what he was mentioning is rather than issuing new bonds uh or you know we could use the cash increased cash flow that we had in order to make some of these capital improvements. Is that correct? >> That that is a strategy. Yes. >> And then um when should when do you think we should enact the uh changes in to the township for the fees because they shouldn't be paying the same price we are. Should we >> My opinion is as soon as possible. >> Okay. I mean, this has been going on for a long time and from somebody and and you have to understand, I look at a lot of communities with water and sewer rates. Um, I look at it objectively. Uh, I'm also a water sewer cer customer

41:46 customer where I live and I I get it. I get a bill and like, oh, well, I guess rates went up again. Um, but the important thing is here we're trying to balance how things work and be equitable. So equity has to factor in where the risk is and who's putting the money into the system and it's the village and for so long the folks in the township have just been getting a free ride. >> So >> so the cash cow needs a stop. >> Well I think it's it's time to really rightsize the rates. >> Can you walk us through what a levy would look like, Tim? Well, I would uh are you talking about a general fund >> stabilize the general fund?

42:31 >> If I would ask John if he could explain what when you're referencing a general fund levy what that looked like. >> So you have a couple of options. Your I don't know how much people know headley roll backs have happened consistently. So in the Michigan Constitution, for those of you that don't know, every year there's a calculation done in every taxing jurisdiction in the state, and there's a number produced. And if it shows that the taxable value in that community increased more than the rate of inflation, the state permanently reduces your charter levy. I mean, the charter levy is there, but you can no longer tax whatever percentage they've just shaved off. you have lost substantial value

43:19 over the years because of that and the Headley amendment has been in effect since 1972 or something. Um so it's been a long time and it just erodess away at the taxable capacity of every jurisdiction in the state. So the maximum you can tax with your general fund levy right now is a lot less than what your charter says you can tax. Um so two options are one you ask voters to override the Headley amend or the the Headley roll back and that is a legitimate process where you essentially ask voters to say we are going to allow our village to tax us in excess of what the state has said the headley roll back is for a period of time to be determined

44:04 by whatever ballot language there is. Um, another option is a special levy and that could be targeted towards capital improvements. You have the the special assessment for public safety. A lot of communities have a tax, an advorum tax as opposed to a special assessment uh for public safety. It could be for parks. It could be me for many different things, but it's defined in what it's for and for the term. So those are the options that you have for bringing more money into the general fund. >> So it's similar to a special assessment but it's project defined and time >> well it's also voter >> it's voter approved >> for example now okay so like the um the

44:49 police and fire uh millages that were done across the state that a lot of them failed recently in Oakland County that was those are examples of some of those. Yes, those are special levies. >> We did talk about obviously a headly we when we this budget season, last bud budget season, we talked about what a headley override would look like, how that processes work. Obviously, we have not adjusted our rate since 1982 since we incorporated uh as a uh home village and so because of late A, we have not been able to adjust that rate back up. >> Right. council. >> So in our charter it says we should be taxing at what? 20 >> 20 mills. >> 20 mills. That's the maximum. And and this year we did 10.9857

45:36 or something, right? So it's >> which is your headly limit. >> Yes. Okay. >> So even if we did a headley override and it said we could go back up to our maximum of 20, that doesn't mean that we should. It means that that would be the capacity at which we could go. We would look at the budget what we need and then you would establish your mill rate at that point. >> Correct. >> Verification. >> Yes. Yep. That's correct. >> Yeah. And then but then again as soon as that happens Headley starts again to take those numbers down. >> And and similarly another option is a debt levy which we've talked about briefly. Um, so if you ask voters to approve a debt levy, you're asking them to approve as up to a certain amount of

46:21 taxation to fund the debt service on whatever debt you're issuing. Um, as your taxable value changes, it usually goes up. Um, and your bond payments are usually pretty steady. That means that debt levy typically goes down year-over-year. Um, that can be structured different ways, but ideally is they approve up to a certain amount and then you can't tax them for any more than that, but you can only tax them enough to collect for the debt service. >> Something something that stuck out was um timing. We just watched a lot of villages get denied. So if if we do a road

47:08 millillage, um the likelihood of that passing right now, I I think would be very slim. We'd have to do a lot of education and and pick a pick a prime time for after that education was released on as many medias and um meetings as possible. But I know we talked about maybe doing it in February and it kind of stinks to think that we'd have to pay that extra money for a special election, but I don't think it would have passed this November anyways. So that's unfortunate, but um was there a recommendation? What what was the recommendation for the road millillage? Was it 2 mills 2.3 and 2.9? That >> again that was for illustration. If you're trying to generate enough to pay

47:55 an $8.5 million bond or a $5 million bond over 15 and and bonds are often 20 years, but for roads, they don't last 20 years in Michigan. So, we don't want to bond >> for a project that's going to be out of service and still be paying debt service on it when it's no longer useful. >> We also have our village engineer in the audience. I just >> I think So we're clear on like mill rates too. So as Shannon said, we're almost at 11 plus that four that we have for the special assessment which brings us to 15. Then we're asking another five which is going to be it will be 20 mills. >> Yeah, almost like our charter said that we needed

48:45 >> council. Any further questions? >> I just had one more to piggyback off my uh water rate one. If we increase the value or increase the uh payment from the outside residents, would that be able to bring down the bond amount for the residents inside the village? >> It it so if all the rates go up, then the fixed charges and the variable charges adjust. So if you think of it as a pie that's being sliced into 100 slices, if we now charge outside customers 150% that the number of slices has increased and more of them are allocated to the township. So the village customers pay less of that total pie >> because I know a lot of the a lot of our

49:30 uh people inside the village complain and don't like the amount that we pay for that water bond fee thing. I don't like it either. >> And and and we are I mean you're you're currently that specific charge has been changed to the ready to serve charge. Uh so in rate setting we're trying to recover fixed costs from a fixed charge. Um that's that's generally how we do it. So >> as we and the whole intention when we were looking at cityhood and the idea is has always been to I gota turn the mic on too. So the idea has always been to how can we actually lower the like lower how much people are paying in taxes but but be able to maintain the level of service or increase. And so obviously the only way you can do that is increase your

50:16 taxable value and there's only a couple ways you can do that. And that's the reason that we were looking at cityhood pretty aggressively at the time. >> This one's for Tim. Do you have an estimate of like how much money is required to repair our water infrastructure as it is because we have this cash on hand but that's pretty much already spoken for. >> Yeah. So I we don't have a number specifically. Even our saw grant when we originally did it was supposed to give us that kind of estimate um in 2019 uh about how much and it only did I think like a third of the village to give us that estimate. Yeah. Third. I'm getting engineers give me a head in north and south. So yeah only did a third of the village. So, we only have really an estimate on that. Um, I wouldn't even be

51:02 able to ballpark it because I would have to look at the age of the other infrastructure and all of that just to determine. But, we're also looking at the other things that we're required to do. We are doing our leadline service replacement uh identification right now. We're right in now in the identification process of that, but we are going to be required to replace any uh lead service line or galvanized steel service lines that could have ever been touched by lead. uh and so that is going to be on us to replace um these lateral leads as well. So or the these lines um so these are all other considerations that we have to keep in mind that that was going to cut into this. >> Right. Well, my main point was that it's probably unlikely the village residents would see a drop if we did taxip more

51:47 right now because of our repairs. My response would be in the initial year there could be a slightly lower rate for township or for the village customers but then after that the rates just start you know ratcheting up six 7% a year. U and and also to be clear six or seven% a year is low. Um those are small increases. uh a lot of communities I'm working with. I was just presenting across the estate uh at a village across the other side of the state last night. 13 and a half% for the next four or five years every year. Um I was just talking to another community not too far from here this afternoon. We're looking at um 55% increase in the sewer rates. Um so

52:33 these are real numbers. It is not just Holly. it is every municipality that I'm dealing with because they're all about the same age and they're all starting to fail at the exact same time when all of the prices are up. Um, so that's the challenge. >> Council, if that's all, we can take a seven minute break before our council meeting. >> Are are we good with are are you wanting to continue this work session or can we release John or does he have to stay for the presentation? >> I think we can release him. Gosh, >> you are released. >> I wasn't even I wasn't even arrested. So, thank you. >> We can fix that. Okay, he's not done yet. >> All right, that's a wrap. We'll see you guys at six.

1:00:14 I thought I was going to be the one. >> Good evening and welcome to the August 11th, 2026 council meeting for the village of Holly. Clerk, please call the role. >> Here >> we have a quorum. I will entertain a motion to excuse Lisa. I'll make the motion to excuse our clerk, Lisa Bone, >> as well as

1:01:00 I was going to do them one at a time. >> Um, do I have a second to excuse Lisa? >> I will second it. >> We've got a second by Wein Bunner. Motion by Wendell. All in favor say I. >> I. >> I. Motion carried. I'll entertain a motion to excuse Councilman Cascella. >> I'll make the motion to excuse Councilman Cascella. >> I'll second. No, >> we have a motion by Ryan. We have support by Ker. All in favor say I. >> I. >> Any opposed? Motion carried. >> If you're willing and able, please stand for the pledge of allegiance. >> I aliance to the flag of the United States of America and to the republic for which it stands. One nation under

1:01:47 God, indivisible, with liberty and justice for all. This brings us to the approval of our consent agenda. All items listed under consent agenda are considered to be routine and non-controversial by the village council and will be approved by one motion. There will be no separate discussion. If discussion is desired, that item will be removed from the consent agenda and discussed separately in new business. Do I hear a motion to approve the consent agenda? >> I'll make a motion to approve the uh consent agenda. >> I will support that motion by Wein Brener, second by Cole. Roll call,

1:02:34 please. >> Wendell, >> yes. >> Weer, >> yes. Ryan, >> yes. >> Cole, >> yes. >> Ky, >> yes. >> Brandon, >> yes. Motion carried. >> This brings us to reappointments and appointments to boards and commissions. Similar to consent agenda, all reappointments and appointments will be approved by one motion. If discussion is desired, that item will be removed from the consent agenda and discussed separately in new business. There are no reappointments today, but we do have one new appointment

1:03:22 and that is Resa Hamilton to the historic district commission term ending February 2027. Do I hear a motion to approve this new appointment? I will make the motion to approve Raza Hamilton to the historic district commission term ending February 2027. >> I'll second that motion. >> We have a motion by Kyer. We have a second by Weinerunner. Clerk, please call the role. >> Kyer, >> yes. >> Ryan, >> yes. >> Winunner, >> yes. >> Wendell, >> yes. >> Cole, >> yes. >> Brandon, >> yes. Motion carried.

1:04:07 See, we finished our work session. So, presentations. See? Nope. Presentation continu. Nope. We finished that. Sorry. Public hearing at this time. Can I hear a motion to open a public hearing regarding resolution 2026-037 for reprogram reprogramming of CDBG funding and code enforcement to water sewer improvements. I will make the motion to open a public hearing regarding resolution 2026-037, the reprogramming of CDBG funding from code enforcement to water sewer

1:04:53 improvements. >> I'll second that motion. >> We have a motion by Cole. We have a second by Weiner Runner. Okay. So, we have entered our public hearing at this time. Would any of the members of public like to make any comments? As a reminder, at this time, comments should only be related to the public hearing. Mr. Love, come on up. >> Sean Love, 200 North Second. I don't understand what is happening. They're taking money from the water from code enforcement to water. How much is it? I don't know what's involved. Can you explain it?

1:05:38 Thank you, Mr. Love. Any further public comment? >> Okay. Hearing none. Seeing none, floor is yours. All right. So, um for this, so the um Okay. For so for this uh to answer John's question just for some clarity, I'll probably have Danny back me up on this. So, this is actually something that Lisa and Danny have been working on with CDBG uh repro reproing sorry reprogramming some of the funding. The funding that we have is uh federal funding, the community development block grant funding and the amount was it 49,000? It's in the resolution and we

1:06:25 had previously reprogrammed this to code enforcement. We've been using it slowly. We still have money left in over in code enforcement, but it's going real slow on how we're spending that. We've identified that we're actually able to replace some of our fire hydrants that are not operating within the village and and we're going to reprogram some of this funding in order to replace those fire hydrants. Danny, what did I miss? Go ahead. >> I think that pretty much covers it. um they're all within the CBDG district and so um we're able to replace uh all of the hydrants that are out of service uh with this money. So that's that's the game plan uh without touching our water our water fund and our repairs and maintenance budget for the year. So

1:07:11 >> we're just so one of the things that also with CDBG you have to be able to keep a ratio of spending that is you can't have too much money that from previous years we've had we just spent 2019 money that we had uh we have to we're supposed to keep a 1 to8 ratio I think something like that um and we've just in the past they hadn't spent it all down and so we are trying to be uh good stewards of that money and utilize it in a manner that we're spinning it down so it doesn't negatively impact our ability to ask for CDBG money in the future. >> I think this is fabulous. >> Yeah, >> honestly like this has been a big community concern and I appreciate that this is what we're doing.

1:07:57 >> So right now and again this is just the public hearing portion. We actually do the discussion when it becomes a new business item later in the meeting. >> Okay. >> Just >> All right. Well, then we will close this public hearing. >> I will make a motion to close the public hearing regarding resolution 2026-037 for approval of reprogramming of CDBG funding from code enforcement to water and sewer improvements. >> That's a mouthful. We have a motion by Ky. >> I second it. >> We have a second by Wendell. Clerk, please call the role. >> Ky, >> yes. >> Cole, >> yes. >> Ryan, >> yes. >> Weerunner, >> yes. Wendell, >> yes. >> Brandon, >> yes. Motion carried. >> Again, I think this is a wonderful idea that you're doing.

1:08:43 >> New business. Wait for new business. >> This brings us to public comment. Members of the audience may address council on any item that is not on the agenda. Those adjusting council will be limited to three minutes of speaking time. After each agenda item, there will be an additional two-minute public comment period to speak to those items before council votes. Council will hear all comments for future consideration, but will not have a response at this time. Prior to addressing council, members of the public shall state their name and address for the record. So, non-aggenda items. Any public comment? Hearing none. Seeing none. Okay. This moves us to old business. Item A, reconsideration of resolution

1:09:28 2026-03, establishing the village of Holly cityhood action committee and directing implementation of the city incorporation process. Do I have a first to consider item A of old business? >> Yes. >> All right. So, it's come to my attention that I should disclose that I am married to the township treasurer and this could affect different votes on the city action stuff throughout the life cycle of it. I am also additionally disclosed that I am on the Holly Township zoning board of appeals just in case that affects it as well. >> Thank you for that disclosure. >> We've and just a little follow on that is that in discussions with Phil attorney because uh council member Ryan wanted to make sure that you know he was in the right on everything with the exploratory committee votes. We don't

1:10:14 think there is any conflict again because there's no uh this is really just looking for he can participate in discussion. We can't tell them not to regardless, but we'd encourage them to participate in discussion and vote on these particular items we're talking about tonight. >> Okay. And now, do I have a first to consider item A of old business? I will make the motion to consider item A of old business reconsideration of resolution 2026-038 establishing a village of Holly cityhood action committee and direct implementation of the city incorporation process. >> I'll second that motion. >> We have a motion by Cole. We have a second by Ky. I think she wins that one.

1:11:01 She wins that round. All right. This is an item that I asked the village manager to add back onto the agenda for reconsideration. Okay. First, any public comment on this item, Mr. Love? >> John Love. Uh, I thought this cityhood thing was dead. It's not. I don't understand what the point is because uh seems to me it's a waste of time and money. >> Thank you, Mr. Love. Any further public comment? >> Anthony Jery, 110 Park Avenue. I sat through the last hour as well. Uh cityhood annexing is just another word

1:11:47 for stealing someone else's land. We shouldn't let the township people pay for our mistakes. Thanks, Thank you. Further public commentaring none. Seeing none council discussion, >> I just want to clarify with Tim. Is this an action committee to pursue it or is this exploratory? Because you've multiple things have been said. >> So, okay, I can I can read off again. This was from the previous one. I can read off my my council action report that I had given last time. Also, I I was remiss. Uh I I need to introduce Pat who's our village attorney for the night. We've met obviously you know

1:12:33 Mike, we've met Chris, we've met Thomas. Uh and Pat is from uh the the firm that is representing tonight. So any questions he can also assist with >> hired Mike law school. So >> he and I have been law partners for 15 years. I've heard rumors of him wandering the halls, but this is the first time I've met. So, >> welcome. >> Thank you. So, the purpose of the Tatcher resolution is to establish the village of Holly cityhood action committee and authorizing to advance the process of transitioning the village of Holly from a home rule village to a home rule city. This is not an exploratory committee. To answer your point, the village council has previously discussed the potential benefits and implications of cityhood and is now prepared to move on to the next phase of the process. The

1:13:18 proposed committee will serve as the council's working body for coordinating the legal, administrative, financial, and public engagement activities necessary to p pursue cityhood incorporation. Uh the background under Michigan law, the corporation of a plumemeral city requires a formal process that may include determining the proposed city boundaries, preparing and filing petitions, coordinating with state and county officials, developing a proposed city charter, conducting elections, and providing residents with clear and accurate information regarding the transition. The cityood process will require sustained attention and coordination beyond what reasonably can be accomplished during regular village council meetings or by staff. Establishing an actionoriented committee will allow the village to organize this work, identify required professional assistance and develop a realistic timeline to provide regular

1:14:04 recommendations and progress reports to the council. The recommendation is that village administration recommends that the city village council adopt detached resolution establishing the village of city of Holly cityhood action committee. adoption will provide the organizational structure and clear directions necessary to begin advancing the city process in a deliberate, transparent and legally compliant manner. We have had exploratory committees in the past. Um, in fact, council member Ryan, I think council member Kler were on it. At the time they did um recommend approving to uh take the next steps um and it was postponed by council I believe at that time. Correct me if I'm wrong. I mean >> that is correct and I believe I was the only one that sent it at time. >> Y uh on the on as part of the committee. You're on council >> as part of the committee. Yep.

1:14:50 >> So this is a council subcommittee, not a citizen committee. >> At no at the time that was a citizen committee. Neither council member Consula or Ryan were on council at the time. They were just part of this committee. >> That's right. >> It was a council committee though that you guys voted for and the village president at the time was liazison. >> Got it. Okay. >> So this Yep. And at the time they again they they recommended moving forward the vote they bas I think they postponed I think this was in November I believe that they decided to postpone it until a future date and that's why when we uh began looking at cityhood again we had the initial conversations that is the information that we use as a starting point >> now since we've discuss we've discussed this a bit in the past should there be a

1:15:37 council leaison or no >> um yes I believe there should be a council leaison. Uh I can't remember. I would have to look at the actual resolution. It was a few months ago that we wrote it. >> Okay. >> You have three of them on there. >> Yeah. Okay. >> Three council members. >> Yep. There should be council members as representatives on it. >> You said there should be three. >> That's what's in the resolution. >> Okay. >> So, three council members and how many citizens is the recommended? >> I would have to go back again to >> I think it was three citizens possibly one from another board. Um, someone from staff I believe was going to be on it. Tim was going to be on it.

1:16:23 >> It's a long resolution in comparison to previous resol. >> Page six. >> Yep. The membership will should include three members of the village council, the village manager, at least rep one representative of the local business community, at least three village residents, at least a representative of a village board, commission or authority, and other members possessing relevant professional government, financial, legal, communication planning or community experience. So, uh, not fewer than seven, not more than 11 voting members is a recommendation in this resolution. >> Seven to 11 voting members. And I'm assuming staff cannot vote >> in this they the it would be none of them are um exeicio so they would all be able to vote. >> Everyone votes. Okay. So 7 to 11

1:17:08 members. Got it. Council anything else? Okay. >> Go ahead. >> I just don't know where to begin yet. So if anyone has anything they want >> talk about. So >> all right. So for me the biggest issue with this is the cost. Um I remember seeing a post online saying that we only have about a little under $2,000 carrying over and there's a lot of costs inside this resolution that's going to come up. So how would we pay for it? I don't believe the resolution authorizes any expenditures for it. >> Well, there's besides staff, >> printing, there's a bunch of stuff

1:17:57 >> there, as far as you know, staff time. I mean, that's being paid for it and that's something that we have to you have to decide whether or not it's something that you want staff to prioritize. >> Attorney usage, that's also a cost that can easily eat up into our budget for that >> and that's what we would have to get those things authorized as part of it. And that's there are specific guidance within there within the resolution about how that should get approved at any kind of cost. >> And again, this is a a draft of the resolution. Any changes council wants to make? That's up to council. >> One thing that I would also like to see change if this is voted on that the meetings be reported for transparency. So that way public that can't make it to

1:18:42 one of the committee meetings or committee meetings during the workday. You guys have a form of people during the workday that can get some action passed a little bit faster. Then that way we can have it reported. Everyone has the option to go watch the video, get their input and stuff like that just for transparency. >> So section 13 does cover reporting. It says committee shall provide a written or oral progress report each regular village council meeting unless the village council directs otherwise. The board shall identify actions completed, current petitions or filing status, upcoming deadlines, public engagement activities, decision requiring council action, expenditures or contracts requiring approval and obstacles that

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