BABBITT— Residents here packed their city council chambers Monday during a four-hour meeting in which the council tried to set a preliminary levy for 2026. A previously proposed levy increase and budget summary showed substantial cuts to the police department and library.
During the meeting, things became contentious enough that some residents called for a councilor to resign.
After the dust had settled, the preliminary levy increase had ballooned from 15.5 percent to 20 percent. The police department’s budget was made whole, but the library’s budget was still cut over ten percent. Councilors also decided to stash more than $50,000 into a facilities budget.
After the meeting, Library Director Lisa Pennala told the Timberjay she felt “terrible.”
“We’re probably going to lose hours. We’re probably going to end up losing one staff member. I’m not sure quite what else.”
Babbitt department heads had collectively requested budgets exceeding $4 million, while city revenue projections hover around just $2.7 million — creating a $1.3 million shortfall that forced difficult choices.
The mismatch drew fierce criticism over proposed cuts to essential services.
Police officer confronts council
Tensions reached a breaking point when Babbitt Police Officer Phillip Ruelle stood before the council to defend his department amid allegations that councilors had privately spread misinformation about Police Chief Troy Bissonette’s commitment to the budget process.
“I’m angry at how this council has [dragged] my chief’s name in the mud publicly and personally and privately to the citizens of this town,” Ruelle said. “He is the best thing that has happened to this town in a long time.”
The confrontation escalated when residents accused a council member of unprofessional conduct, with one stating, “I would call for you to resign because that is honestly unprofessional.”
Midway through the meeting, newly hired City Clerk Nancy Sanford — just 11 days into her position — said that she had discovered approximately $60,000 in previously unaccounted state police aid revenue for 2025 and 2026.
“There was $62,000 in revenue in 2024 that was our state police aid fund,” Sanford said. “On our 2025 budget, we did not include what our police aid will be for 2025, and we did not include it in 2026 either. ... I apologize that I did not catch this when I had my first glance at the budget.”
This discovery effectively saved the police officer’s position, though residents questioned how such a significant oversight could occur in a city already struggling with financial management.
Library bears brunt of budget cuts
While the police department was spared, the library wasn’t as fortunate. Despite overwhelming community support — demonstrated when dozens of residents raised their hands in solidarity — the library budget was slashed by over ten percent, the steepest cut of any department.
The cuts reduce the library’s book budget from $8,000 to just $2,000, allowing for only about nine new titles per month. More significantly, payroll cuts of nearly $18,000 will likely force the elimination of available hours and staff.
Years of financial
mismanagement revealed
The meeting exposed deeper systemic problems with the city’s financial management. Sanford repeatedly apologized for budget confusion stemming from previous clerks’ bookkeeping practices.
“The previous clerk formatted the budget differently, and the numbers are confusing,” she said. “I will fully admit I am probably not at 100 percent yet, but I’m getting pretty darn close to being there.”
City audits revealed such extensive problems that the 2024 audit was delayed for months because auditors “couldn’t make heads or tails” of the financial records. The city hired an additional company to straighten out the books at a cost of approximately $25,000 to taxpayers.
Hidden campground costs anger residents
Adding to residents’ frustration was the revelation that the city’s campground — long promoted as self-sustaining — has been operating at a deficit of approximately $40,000 annually.
The facility’s bond payments were previously hidden through an internal rent collection system more recently deemed illegal by auditors. The city had been charging various departments rent fees to cover the cost of the campground’s bond, but that methodology is no longer allowed. 
“I was told when I ran, no money comes out of the freaking city tax dollars for the campground,” said Councilor Joe White, expressing frustration at discovering the hidden costs. “It was kept secret from everybody.”
Residents questioned the priorities of subsidizing a recreational facility while cutting essential services.
“How comfortable can campers be at an unsustainable campground that drags resources from our community when their safety was the cost of entry?” asked one resident.
Administrative costs under fire
Community members also challenged administrative expenses, particularly questioning how the city justified $212,000 in combined salaries for three administrative positions when basic services face cuts.
The new city clerk’s $90,000 salary drew particular scrutiny. “What justifies $90,000?” one resident demanded. “There’s three people in that office... how many people pay water bills and garbage bills? How long does that take?”
Looking ahead
Despite the turmoil, city officials expressed hope they could reduce the 20 percent tax increase before final approval. The preliminary levy can only be adjusted downward.
Mayor Andrea Zupancich acknowledged community frustrations while defending staff efforts to address years of financial problems.
“We’re frustrated too, and everyone is taking it out on us when we’re trying to get everything to all the department heads because we know how urgent and important it is,” Zupancich said.