To eliminate a budget deficit, the St. Ignace city marina has cut its expenses by about $66,000 so far this year, according to a financial report presented to St. Ignace City Council by Marina Director Gene Elmer at its Monday, August 17, meeting. At the request of City Council, Mr. Elmer gives monthly reports on marina finances.

This 44% decrease from 2008 spending does not include water expenses because 2008 year-todate numbers were not available. The decrease in spending was calculated using last year's year-todate expenses compared with 2009 year-to-date expenses as of July 31.

The water bill was $118 for the month of July 2009, while $319.80 was spent on water in July 2008. This difference, on a micro level, echos Mr. Elmer's aim to cut costs wherever necessary to eliminate the marina's deficit and eventually draw a profit for the city.

"They can't buy a pencil without coming first to get permission," Mr. Elmer said of new requirements for marina employees to clear all expenditures with him first. During Monday's Council meeting, this comment got a laugh out of city staff, since pens had recently gone missing from various desks. The finger was pointed at Mr. Elmer.

The marina operated with a $56,000 deficit in 2007, which increased to a $116,815 deficit in 2008, according to the city's annual audit. The marina is the only one of the city's business-type sectors operating with a deficit in 2008. These sectors also include water, sewer, garbage collection, and the golf course, which all ended the year with some, if not much, net revenue for the city.

If July expenses and revenue are any indicator, the marina is on its way to digging itself out of the red. July 2009 revenues were $107,221,48, exceeding July operating expenses by $81,455.72. July 2008 revenues only exceeded expenses by $57,980.35.

Mr. Elmer said, however, that comparing revenue to expenses for individual months is deceiving because large fuel purchases are made at different times each year, not necessarily months when revenues are high. A large portion of the marina's yearly expenses has not yet been included in the report, he said, since a large fuel purchase is usually made in the late summer and early fall.

For instance, year-to-date expenses at the end of July 2008 were $161,233, while expenses for the entire fiscal year were $617,901. Revenues made a jump in 2008 as well, although not as much, from $308,466 at the end of July to $501,086 at the end of the year.

This year is down about 25% from last year. Total 2009 revenue, as of July 31, was $208,582, compared to $308,466 last year. The cuts in expenses still come up almost $12,000 shy of the total $77,885 drop in revenue, according to the July 31 report. Mr. Elmer said that these numbers could certainly change between now and the end of the year, when large fuel purchases are made and more revenue is also collected.

He attributed low revenue numbers this summer to cold and rainy weather early on, something he said caused even regular seasonal boaters to keep their boats out of the water completely.

"We had a horrible start with weather," Mr. Elmer said. "That affects boating big time."

A small boost to revenue this year was experienced in the department when $2,000 was transferred from the city's public recreation fund to help pay for cleaning and maintenance of the public bathrooms.

Wages were cut by $9,316, or 24%, through the end of July when compared to 2008 wages.

Revenue collected this year from boats docking at the marina is up 3.4%, or $4,630, from the same time last year, but 14% less fuel has been sold this year, which amounts to 6,535 gallons.

Two weeks into August, however, Mr. Elmer said fuel sales had not only closed this 6,535-gallon gap, but the marina had sold 165 gallons more than last year. He also said he expected total revenue collected from dockage and boat launches to increase.

"We had a good first two weeks of August," Mr. Elmer said.

Continuing to decrease expenses is how Mr. Elmer said he plans to eliminate the deficit.

"I plan on getting out of debt in one or two years," he said. "We are not hiring anybody new next year."

After eliminating one position this summer, Mr. Elmer has reduced his staff to nine employees, down from the 12 who were staffed in the marina's first year.

Water expenses were cut by not using sprinklers, office supplies were cut $889, overtime pay was eliminated, printing was cut $810, maintenance was cut $879, employee training was eliminated, saving $670, and $1,347 spent on capital outlay and equipment last year was eliminated.

A few categories showed increased expenses on the year-todate financial report, including a $126 increase in the communications budget, a $104 increase on equipment rental, a $511 increase in sundry expenses, and a $2,590 increase in the electric bill.

The increase in sundry expenses, Mr. Elmer said, was to pay the marina's share, $1,100, of the new city Web sites now under development.

The increase in the electric bill was attributed mostly to increases in electric rates this year, according to Mr. Elmer.