The East Lansing City Council has unanimously passed its 2026 budget, but while it makes some cuts, overall, the budget keeps the city in a $2.5 million deficit.
The city’s financial strain stems in part from the loss of revenue from the Lansing Board of Water and Light, after the Michigan Supreme Court ruled earlier this year that a city-imposed “franchise fee” was illegal.
In this new budget, council members made efforts to cut costs and raise revenue — such as eliminating an EMS position as well as one in the 54B Court and charging a fee for the land used for parking systems. The city is also changing its policy to pass along the fees they used to pay for some credit card payments onto customers paying for city services.
But while these measures helped, they weren’t enough to eliminate the shortfall.
Despite this, councilmembers avoided a larger cut to the city’s Parks, Recreation and Arts Department. They were considering removing the department from the general fund, which would have saved $2.6 million and resulted in a budget surplus.
“ Nobody wants to cut it,” Councilmember Erik Altmann said of the department. “It's very important to the community, but it's also discretionary spending, and we need to find a long-term stable funding source.”
The council is now considering placing a parks millage on the November ballot, which would leave the decision to voters.
In the meantime, the budget currently relies on city savings to cover the deficit, but Altmann warned that approach isn’t sustainable.
“We have at maximum two years of burn rate at the level of deficit we’re running,” he said. “In fiscal ’27, we need to be balanced.”
Altmann added continued use of city savings could hurt East Lansing’s credit rating and raise borrowing costs.
Planning for the next budget — for fiscal year 2027 — is expected to begin in about seven months.
Produced with assistance from the Public Media Journalists Association Editor Corps funded by the Corporation for Public Broadcasting, a private corporation funded by the American people.