Coopersville Prepared For Worst

October 17, 2005
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COOPERSVILLE — As the city of Grand Rapids was reeling from news that its largest taxpayer, Steelcase Inc., was shuttering its Grand Rapids facilities, Coopersville was polishing off a worst-case scenario of its own.

In May, City Manager Steven Patrick presented to the city council a $2.1 million budget to be used if its largest taxpayer, Delphi Corp., shut its doors.

Delphi’s 500-employee fuel injector plant at

999 W. Randall St.
pays just over $500,000 in taxes and $180,000 in water and sewer bills each year. Down from a high of 31 percent, the now bankrupt auto supplier currently represents 24 percent of Coopersville’s general fund.

“If you take 24 percent out of your budget, it’s going to be a large impact,” Patrick said last week. “The point was to get people thinking about what services are critical to the community…If you have ‘x’ amount of dollars, where do you want those to go?”

Patrick compared the mock budget to the Price of Government exercise used this summer by state legislators.

The mock budget — which presented a choice between across-the-board cuts and targeted cuts eliminating positions and scaling back services — assumed a loss of real property tax revenues from a plant shutdown. In this model, Delphi would still be paying about $310,000 in property taxes and $28,500 to the water and sewer fund. It would nonetheless remain the city’s largest taxpayer, contributing 15 percent of the general fund.

The scenario did not include the true worst-case scenario, Patrick said, that Delphi ceases to exist as a legal entity and is not able to pay any taxes.

Luckily, neither of these situations appears to be forthcoming, Patrick said. The plant is currently profitable, employees are working overtime, quality is high and it is still in the process of installing a brand new assembly line.

However, the same model can be used to absorb a similar reduction in revenue, such as the concurrent closing of several smaller companies or a drastic cut in state revenue sharing, he said.    

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