Two Cool, But Too Little

June 19, 2006
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GRAND RAPIDS — When city commissioners adopted the new fiscal year budget last week, there was another glaring hole on the revenue side of the 2007 spending plan. For the sixth consecutive year, the amount of state revenue-sharing funds from sales tax collections wasn’t as high as city officials believed the figure should be.

In fact, City Manager Kurt Kimball predicted earlier that revenue from the fund would be $9 million less than what the city deserved; an amount that would easily cover the shortfall the city expects by the end of FY07. That $9 million, Kimball pointed out, could be added to the $21 million he said the city lost in revenue-sharing funds the previous five years.

“We’ve been hit and hit with revenue sharing, which everybody thinks is some kind of gift. But the money comes from Grand Rapids,” said 1st Ward Commissioner Roy Schmidt.

So some city officials are puzzled when the state reports that it can’t afford to fully share this revenue with local units, but gives away grant dollars for various programs. This time it was the Cool Cities Program, a yearly $2 million statewide incentive begun by Gov. Jennifer Granholm three years ago to rehabilitate older urban areas, that drew a few comments.

Although the commission did back the two local entries into the current round of Cool Cities funding, which could be worth $100,000 to each if both are selected, two elected officials said the program wasn’t all that cool.

“I support these. But the $200,000 we’re getting is crumbs as opposed to what we need to get,” said 2nd Ward City Commissioner Rick Tormala.

Tormala said loading these grants with $2 million when the state claims it can’t come up with money for revenue sharing was wrong.

First Ward Commissioner James Jendrasiak said he was troubled that the program’s funds provide benefits to commercial interests. He said the grants should only go toward public improvements, such as creating better sidewalks and streetscapes for everyone.

But 2nd Ward Commissioner Rosalynn Bliss countered that the commercial interests that profit from the program are vital to the development of the city’s neighborhoods.

“We’re looking at small, locally owned businesses,” she said.

The submissions that commissioners endorsed are for the “Neighborhood in Progress” portion of the Cool Cities initiative. Grant winners are eligible to receive up to $100,000 and are given access to the program’s “resource toolbox” that contains other potential funding sources.

“The $100,000 is not a significant amount of money, as some projects have required $1 million more than that,” said Assistant City Manager Jose Reyna.

Reyna, who manages the program for the city, said receiving a grant gives a project a chance at getting other grants, even some from the private sector.

One project that Reyna brought to the commission would convert a former industrial building on Madison Street into a 60,000-square-foot commercial center for IT companies and make exterior improvements to the structure and upgrade the streetscape.

The other would help to convert a Heritage Hill apartment complex, The Hillmount, into condos, fund a façade improvement effort, and execute a wayfinding and beautification program for Foster Park.

“I think it’s something important to the neighborhood, because it creates an identity for them,” said Reyna of the wayfinding sign system.

The state will unveil the Cool Cities award winners by mid-July.    

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