Muskegon, Mich., is moving forward with one of the largest capital projects in its recent history: a $43 million overhaul of City Hall, its public works campus, and thousands of aging water meters across the city, all financed without asking voters to approve a single dollar.
The project, structured as an energy performance contract with Johnson Controls, covers renovation of the central Department of Public Works facility and City Hall, replacement and automation of more than 10,000 water meters, and electric, HVAC and domestic water upgrades across multiple municipal buildings. The total financed cost is $43,296,839.
The financing mechanism is the key to how this gets done. Rather than a voter-approved bond, Muskegon is using a tax-exempt lease purchase agreement, a structure that lets municipalities borrow at lower rates without going to the ballot. Johnson Controls, as the energy performance contractor, guarantees that savings on utility and operational costs will offset what the city pays over time, making the project designed to be self-funding on paper.
For a city of roughly 37,000 residents that has shed population and industrial jobs for decades, that arrangement matters. Muskegon's tax base has contracted sharply since its manufacturing peak, making a traditional millage campaign a difficult political lift. The energy performance contract model lets the city unlock capital it otherwise couldn't easily access.
The water meter piece is particularly urgent. Replacing more than 10,000 meters with automated systems improves leak detection and billing accuracy, problems that hit hardest in cash-strapped cities where unaccounted-for water loss quietly drains revenue. Michigan water policy has grown far more aggressive on infrastructure amid the Flint lead crisis, and Muskegon has already been working to remove lead pipes in older neighborhoods as part of that broader shift.
The city has posted a request for financing proposals, with proposals due June 17, 2026. Construction timelines have not been publicly detailed, but securing financing is the immediate next step before work can begin.
