City Feels Industrial Development Policy Is Solid

June 13, 2002
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GRAND RAPIDS — If you ask City Manager Kurt Kimball, he will tell you that the City of Grand Rapids has played and continues to play an active role in industrial development — and the numbers would back his claim.

He could tell you that since the inception of its Renaissance Zone in January 1997, the city has provided tax breaks that have led to more than $102 million worth of private-sector investment, with about $45 million of that money going into the manufacturing base.

He could also tell you that since 1975 city-approved Public Act 198 tax abatements have helped industrial firms invest more than $1 billion in new equipment and expansion projects.

“I’d say this city has a track record of being extremely accommodating of anything that will enhance our economic development as a city,” said Kimball, who has been a key player in this policy for a dozen years.

“Going back years, we’ve had a global policy with regard to tax abatements and other economic development tools,” he added. “And throughout a variety of city commissions, that philosophy of keeping our eye on the ball with regard to economic and industrial development has been unwavering.”

But two recent Renaissance Zone decisions have raised some doubt about that policy.

The chamber of commerce complained about a June decision made by commissioners that let Wolverine Coil Spring Co. into the zone at the last minute, and against the advice of the city’s Economic Development Priority Team, which reviews all applications.

“The process has been violated because you’ve got some commissioners who go against staff recommendations, or go against committee recommendations, and insert these things without following the normal process,” said John Helmholdt, political affairs manager for the chamber.

Grand Rapids Spring & Stamping President Jim Zawacki, a competitor of Wolverine Coil not in the zone, also protested — not against Wolverine, but against the selection process that Zawacki felt gave a competitor an unfair financial advantage. He said he has been trying to get his plant in the zone for three years.

“I think the way the whole thing happened was wrong. That was a last-minute thing that the staff did not recommend and that I’m told commissioners voted in favor of, anyway,” he said. “By no means am I against Wolverine being included. I’d like to see both Wolverine and us be included.”

Then there was the decision to allow Fleming Companies Inc., the nation’s number-two food wholesaler in the nation, into the zone.

With all the usual bluster that Texas-based firms are noted for, Fleming gave commissioners a deadline to meet its request and then skipped the meeting in which commissioners discussed it. Fleming said if it didn’t receive the zone’s tax breaks, it would leave its leased distribution center at 650 Ionia SW within a year.

Commissioners approved Fleming’s request, but added three conditions that the firm must meet to be included in the zone. So far, Fleming hasn’t agreed to those terms. But the experience raised some concerns about the city’s policy, even from commissioners.

“If they can’t be considerate enough to show up to our meeting, why are we doing this?” asked 2nd Ward Commissioner Lynn Rabaut.

“It would seem to me the minimum we could expect is a response to our questions,” added 3rd Ward Commissioner Scott Bowen.

Even with those issues, Kimball didn’t think that the city’s policy has changed or even become a bit inconsistent. He felt that Wolverine and Fleming were isolated cases, and the resulting actions weren’t unusual for a board that alters its membership every few years.

“The only change in my book is some more critical questions are being asked, which I think is a healthy thing. This current group of city commissioners aren’t clones of each other. They’re inclined to examine something carefully and they’re interested in making sure there is a return on our investment,” he said.

“But I dare say that we haven’t really changed course.”

Kimball emphasized that during his lengthy tenure as city manager, city commissioners and administrators have remained remarkably dedicated to the city’s philosophy of helping manufacturers develop and grow — and the reason for that is fairly simple.

“If we don’t grow jobs and opportunities in this city, guess what?  We’re not going to have the resources coming in to do all the other things that make this a city with an extremely high quality of life,” he said.

“So if we can do one thing right by keeping our eye on the ball in terms of economic development — the maintenance, the retention and the growing of jobs in this city — the rest will take care of itself.”

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