Council's Budget Could Increase
GRAND RAPIDS — Members of the Grand Valley Metro Council are expected to review and adopt a general fund budget next week for the upcoming fiscal year that starts Oct. 1, a spending plan that is roughly $500,000 higher than the current one.
The regional planner expects to receive $2.3 million in revenue over the coming year, a figure that has been projected to be about $36,500 short of expected expenditures. In contrast, the current $1.8 million spending plan looks to have a small surplus of $13,600.
GVMC Executive Director Don Stypula said the deficit largely comes from the council’s upcoming move to its new office in the Riverview Center at 678 Front Ave. NW, which may be delayed by three months. The council had hoped to leave the Trust Building in early March, but now it looks like the agency won’t get into its new office until June.
The Internal Revenue Service needs to vacate the second floor of Riverview Center and the U.S. Postal Service needs to move from the third floor into the IRS office before the council can take over the USPS space. The IRS is moving to Cascade Township and its new office is taking longer to build than originally expected.
“While we anticipate some cost savings in the form of reduced rent and parking costs for the next fiscal year, we will not see the full range of savings until FY2010. Circumstances beyond our control will delay our move to Riverview by three months, but we will still see cost savings over the long term from this move to new, more efficient space,” said Stypula.
Stypula has budgeted $65,000 for the move, but anticipates the actual transition will cost less than what he has set aside. The move monies have been allocated to the administration and transportation departments.
The FY09 general fund budget contains more spending for administration, land-use and transportation than the current one. In its draft form, the administration budget will go from $310,000 in FY08 to $352,000 in FY09 (a 13.5 percent increase); land use will rise from $267,000 to $291,000 (an 8.9 percent increase); and transportation will move from $775,000 to $1.13 million (a 45.8 percent increase).
Transportation expenditures will account for almost 48 percent of the council’s total spending in the next fiscal year. For the current year, those expenses have made up 43 percent of all general fund spending.
Stypula said he was concerned that federal and state transportation funding will shrink in the future because road money from the gasoline tax is down, as consumers are driving fewer miles. At the same time, he pointed out that the cost of repairing roads is rising. He noted that the engineer’s estimate of a recent 44th Street project was 17 percent below what the work cost.
But GVMC Transportation Director Abed Itani said he expects the state will spend more on infrastructure in the coming years.
“We don’t anticipate any slowdown,” he said.
Plainfield Township Supervisor George Meek said the cost increase for road work hasn’t gone underground. He said his township had received “good bids” from at least 15 bidders for water and sewer projects, most likely because those types of jobs have become scarcer.
“I’m wondering if a lot of our community planners are sitting around with nothing to do,” said Tom Fehsenfeld, council-at-large member.
Stypula said the state will debut a new transportation funding task force later this year, most likely after the November election. He also said six proposed bills would give counties the authority to raise tax revenue for local road work. The bipartisan bills would let a county:
- Impose a one-cent sales tax for roads.
- Create a three-cent gas tax. If two counties go together, the gas tax could be a nickel. If three counties go together, the gas tax could be seven cents.
- Add a $25 tax on a driver’s license and a $35 tax on a chauffeur’s license as long as the revenue goes to fixing roads.
- Levy an additional 25-cent tax on the real-property-transfer tax for every $500 of a property’s value. Voters, though, would have to approve the additional tax.
- Add an additional 20 percent to the cost of a vehicle registration.
- Add a surcharge to a driver’s or chauffeur’s license.
“Transportation is jobs. It’s how we move people and goods; it’s economic development,” said Stypula.
Ottawa County officials are debating if they should put a small millage for transportation funding on the November ballot. Kentwood Mayor Richard Root said there isn’t a sure-fire formula they can use to figure that out. He said voters in the recent primary election ratified millages throughout the region, including one for his city’s library system, even though the economy was bad.
“It’s not easy, but it can be done,” said Root of getting a millage approved. “You think you know, but you don’t know.”
The council’s general fund budget has a 3 percent cost-of-living wage increase for every employee. Fehsenfeld said a cost-of-living increase was the standard pay hike when revenues were more secure. But he doesn’t think that is the case now, and he suggested the council look at merit increases for the next budget. Stypula said he would consider making that change to the pay structure for 2010.
“Just like any private organization or your household,” said Stypula, “we have to look at every single issue.”