FY 2011-12 will continue the trend of financially challenging times for the City of Sturgis. Recent years presented a host of financial issues including a substantial increase in pension costs, an unprecedented decrease in property tax revenue since the inception of Proposal A as well as declines in State Shared and ACT 51 revenues, and flat or declining utility consumption. The City of Sturgis is undoubtedly experiencing the effect of a struggling economy.

The test of any organization facing these types of issues is its ability to reevaluate, reinvent, and seize opportunities that are presented. Under the direction of the City Commission, City staff is constantly reviewing operations and systems for improvements, creatively using grant funding for needed projects and exploring innovative and cost effective ways to deliver services. Some of these changes have impacted services such as brush pickup and snow removal and others have impacted employees by reducing overtime and increasing benefit cost sharing.

One of the primary ways that we have dealt with these financial issues is to take advantage of employee attrition – in 2005 the City had 119 full-time employees and today there are 89. Rethinking and reorganizing systems and work tasks have helped in minimizing drastic changes in the level of services to citizens.

Our five-year projection model used for planning shows a General Fund net loss, which means that more hard decisions will need to be made. The most difficult challenge moving forward will be to maintain focus on the necessary services and capital improvements that will result in a quality of life that will maintain Sturgis as a top notch community.