| 2 min read | by Sean Dalton |

The Sylvan Township Board of Trustees conducted their first regular meeting via the Zoom video conferencing service last night, allowing them an avenue for approving their amended 2019-20 budget before the state of Michigan’s March 31 deadline, which passed at midnight.

The board also passed the draft of the 2020-21 budget, so township operations aren’t interrupted due to lack of payment to staff and vendors.

Township Supervisor Tom McKernan lamented the fact that circumstances resulted in the board holding a meeting to approve these budgets at which no township residents were able to witness the live discussion and ask questions or make statements to the board before their votes were cast.


“I fully expect, because of everything that’s going on that we’ll give everybody another opportunity to look at this budget down the road given our relative lack of public input on this,” McKernan said. “But we need to get it approved so we can write checks and pay bills.”

The amended 2019-2020 budget included an additional $34,500 in expenditures which consisted of a one-time charge of $11,000 for a new boiler at the township hall, $10,000 in additional accounting services that were unforeseen when the 2019-2020 budget was initially drafted, and a basket of small items including $3,000 in additional postage costs, $1,500 in additional costs for upgrading the township’s telephone system, and $1,000 in additional printing and publishing costs.

Sylvan also paid $1,000 in additional landfill costs to Chelsea Landfill, as well as $2,000 in additional insurance costs and $5,000 in additional payroll costs.

The largest item in the amended 2019-20 budget was a $125,000 line item broken out from the township’s planning budget and brought into the general fund. This change was made to comply with the Governmental Accounting Standards Board’s new rule 84, which stipulates that development expenditures must now be accounted for in the general fund.
The $125,000 will not come from the township’s general fund or even its revenue stream. The money was previously collected from developer fees, which are typically spent to pay township staff and/consultants to conduct work related to large-scale developments. This amount effectively balances out to zero, when the fee revenue and the expenses are reflected against each other.

This account change was primarily done to avoid a negative mark on the township’s upcoming 2019-2020 fiscal year budget audit.

A brief side discussion where Trustee Cyndi Jabara asked about the reason for the account change concluded that it might be a good change in that people will be able to see more of what’s happening on the development side of the township’s books, as people tend to pay more attention to the general fund in a budget than special funds.

As for the 2020-21 budget, as adopted it reflects $669,434 in estimated general fund revenues and $450,900 in water enterprise fund revenues for a total of $1,120,484 in overall revenue for the period running from April 1, 2020, to March 31, 2021.

Expenditures for that fiscal year come in at $929,140 with $450,900 of that stemming from water fund expenditures.

The township’s general fund balance, or “rainy day” fund is also quite healthy at $967,038.28 for the end of the 2019-2020 fiscal year, which exceeds the township’s yearly expense budget. Typically a municipality should have at least 15 percent of their yearly expenses budget amount in their rainy day fund. 

In the case of a township that collects property taxes beginning in December, as Sylvan does, having a 50 percent fund balance is considered minimally healthy. Essentially, Sylvan Township’s government has chosen to be extra cautious with its finances.

Township Trustee Rodney Branham said that he felt that residents would be “really happy” to hear that news.

The only significant change in the 2020-21 budget was the breakout of water system operations costs versus water project line items, to better highlight the amount of money that it costs to operate the township’s water system on a yearly basis without the one-time project costs giving the illusion that it’s more expensive to operate than it actually is.

Mr. Kernan also touted the fact that the township would be spending twice as much money as was spent the previous two years on road improvements, which will be the topic of future township board discussions.

The township spent $65,000 and $33,000 on highways and streets in 2018-29 and 2019-20 respectively. In 2020-21 the township will spend $120,000 on highways and streets.


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