Detroit Council Committee Meeting Summary - January 7, 2026

The Budget, Finance, and Audit (BFNA) Committee convened to address administrative updates, public concerns regarding city services and retiree compensation, and the presentation of the four-month financial report ending October 31, 2025. The meeting opened with the approval of November 19, 2025, minutes and introductory remarks from Chair Letitia Johnson emphasizing transparency and resident education. Public testimony highlighted needs for affordable housing support, shelter assessments, and tax justice. The majority of the session was dedicated to a detailed presentation by City Administration on the city's fiscal position, followed by extensive Q&A regarding revenue shortfalls, staffing vacancies, and ARPA fund transitions.

Consent Calendar

• The minutes from the November 19, 2025, meeting were approved unanimously without objection.
• The committee noted the attendance of Councilmember Mary Waters, though no formal motion was required for attendance.

Public Comments & Testimony

• Jadante Smith: Expressed advocacy for residents of Leland House apartments, calling current conditions "really really terrible." Asked the committee to investigate conditions at Cash Community Social Services and Detroit Rescue Mission Ministry shelters, specifically regarding "women with children sleeping in their vehicles." Requested contact information for Deputy Mayor Brian White to resolve a personal water department issue, criticizing the former administration's lack of responsiveness. Expressed a commitment to assisting residents in any district if reached out to.
• William M. Davis: A city charter retiree, stated that the city's bankruptcy was a "fake bankruptcy" used for "robbing [City Detroit] of power and abilities." Expressed concern that city retirees are not being adequately compensated and requested the elimination of the annuity clawback. Raised concerns that over 4,000 retirees have died from the general fund during the tenure of former Mayor Dugan Lee. Asked when the annual comprehensive financial report for the fiscal year ending June 30, 2025, would be published.
• Betty A. Varner: As President of the Soda Ellsworth Black Association, provided information on the Community Solutions Organization led by Director Deborah A. Royal. Described programs assisting caregivers and seniors, including adult daycare, house chores, and meal pickup/delivery. Expressed personal support for the service, noting it helps her family.
• Hira Ahmed: On behalf of the Coalition for Property Tax Justice, urged the council to compensate over-taxed homeowners as an act of "justice." Stated that illegal over-taxation and assessment have caused "100,000 foreclosures" leading to homelessness. Expressed the position that if compensation occurred, "we won't have people living in their cars."
• Caller User One: Expressed strong opposition to current shelter policies, stating "no more Takiana Williams on you all's uh time clock" and demanding the end of deaths of women and children left in vehicles. Stated city workers are "barely making it" and need higher pay. Asked Councilmember Campbell to implement a policy stopping landlords from issuing bogus eviction notices to tenants who complain. Inquired about the implementation of vocational skills training, such as an eyelash technician program, in Detroit.

Discussion Items

• Financial Report Presentation: Acting Deputy Chief Financial Officer Donnie Johnson and Acting Treasurer Valerie Agoalie presented the four-month financial report (ending October 31, 2025).
  • Revenue Projections: Projected a $61.1 million shortfall in municipal income tax compared to prior estimates. Mr. Johnson attributed this deficit to "the tariffs" and the "one big beautiful bill" (federal tax law changes) which benefited corporations through accelerated depreciation and R&D credits, directly impacting city taxable income due to being coupled to federal law. Stated that corporate income tax revenue is expected to come in "$40 to approximately 42 million dollars less" than anticipated in February 2025. Expressed the position that this is an estimate adjustment based on federal law changes, not a result of "giving money back to corporations."
  • Wagering Taxes: Reported wagering taxes are running $15 million ahead of expectations, describing them as "doing gangbusters" and a key "leader in revenue growth." Mr. Johnson clarified that the high revenue is driven by "online gaming" (correcting an earlier slip of the tongue) and noted that the tax deduction for free play is tapering off (from 10% to 6% in 2025, then 4% in 2026), providing further confidence.
  • Utility Users Tax: Explained that this tax is driven by weather extremes; cold increases heating costs, and hot increases AC costs, resulting in overperformance.
  • Expenditures: Noted a $3.5 million negative variance in operating supplies, deemed a "matter of timing" regarding vendor billing. Expressed the view that the city typically underspends by the end of the fiscal year.
  • Forecast: Projected a forecasted deficit of $32.2 million, which is offset by the newly established $42 million Corporate Income Tax Revenue Reserve Fund, resulting in an overall surplus of approximately $20.4 million.
• Staffing and Vacancies: Mr. Johnson addressed staffing levels in police and fire, noting vacancies are due to "retirements" and "late last fiscal year... an increase in retirements." Explained that overtime costs are a driver due to vacancies but departments are working to reduce them. Expressed the position that recruitment is a "constant race" against the private sector, particularly for skilled trades, citing a 10.5-year open posting for electricians.
• ARPA Funds: Stated that current ARPA-funded programs are expected to be wrapped up by June 30, 2025, with decisions on permanent funding to be made no later than that date. Clarified that the CLT (Community Land Trust) fund is held in Fund 4533 (Capital Projects Fund), not Fund 1000.
• Fugitive Dust Fund: Clarified that fines related to the fugitive dust ordinance go into the Public Health Fund, which held a balance of $641,290 as of October 31. Stated that while fines are received, "it's not a huge amount of money per year" as enforcement often finds no violation or results in settlements.
• Income Tax Enforcement: Confirmed that the state of Michigan continues to administer income tax enforcement (tax discovery) on behalf of the city for both individuals and businesses.

Key Outcomes

• Motion Carried: A motion was made and passed to receive and file the financial report for the four months ended October 31, 2025, without objection.
• Directives & Requests: Councilmember Waters requested a list of ARPA-funded positions be provided to all committee members, which Mr. Johnson agreed to provide in writing.
• Next Steps: The committee noted the upcoming February Revenue Estimating Conference where projections will be fine-tuned. Councilmember Johnson announced a Coffee Hour on January 16th at the Commons at 7900 Mack Avenue.
• Discrepancy Note: During his presentation, Mr. Johnson initially stated "sports betting" was driving wagering revenue, later correcting himself to state it was "online gaming." The transcript notes this correction was made by Mr. Johnson himself during the floor discussion.