Jail per-diem talks continuing

October 10, 2008
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No measurable progress has been made on the jail per-diem dispute between five cities and Kent County since voters approved a 20-year renewal of the corrections and detention millage last August.

But talks are continuing and both sides are looking for a resolution — although one may not be coming before the end of the year and most likely not before the election.

Following the August vote, the county offered a dollar-for-dollar cut in the daily fee it charges Grand Rapids, Grandville, Walker, Wyoming and Kentwood, if those cities agree to have their tax increment financing authorities, such as downtown development authorities, stop capturing the growth portion of the county’s corrections and detention millages.

The county feels the revenue shouldn’t be captured because, unlike property taxes, the income from the millages is dedicated for specific uses, and economic development projects aren’t one of those uses.

In 2007, three of the five cities captured $388,948 from the millages, which is roughly 19 percent of the $2 million the five cities paid the county last year to house their ordinance offenders. That figure was up by nearly $50,000 from the $339,792 captured in 2006.

Kentwood did not capture any revenue from either millage the past few years. Wyoming only captured $299 last year and nothing the two previous years. So neither city would gain a per-diem cut from the county proposal.

Grandville collects a small amount from the millages and Walker takes a middling annual figure, so neither would get a substantial reduction in the charge.

Grand Rapids has the most to gain from the county offer, as the city captured 83 percent of the total millage revenue that went to TIFAs last year — over $320,000, according to the tax roll. (See related chart on page 6.)

The cities, in turn, have asked the county for a 25 percent cut now in the current daily fee and an additional 25 percent reduction when the county returns to the state revenue-sharing roll. State lawmakers set 2011 as the year the county is to resume receiving those payments, although county officials aren’t convinced that will happen then.

Cutting the daily fee by a quarter would drop the current per-diem charge from $47.80 to $35.85. Another 25 percent reduction from the current fee would cut the charge to $23.90. The cities feel a reduction is fitting because their residents pay the corrections millage, which provides about $17 million annually to the jail’s $38 million annual budget.

The mayors have said they can better use those dollars for police and fire protection, and charging the per-diem on top of the corrections millage is a form of double-dipping by the county.

The county said it costs $74.97 a day to house an inmate and is already giving the cities a reduction based on the corrections millage.

The county and the cities have had one meeting since the August election. Kent County Commission Chairman Roger Morgan and Vice Chairman Richard Vander Molen met with Grandville Mayor Jim Buck and Walker Mayor Rob Ver Heulen in late September. Morgan told the Business Journal there wasn’t a response from the cities at that meeting to the county’s latest offer revolving around the millages. He also said he didn’t think a majority of the county board would agree to a reduction that was tied to the county’s revenue-sharing status down the road.

“I was trying to be realistic on what I could get them. We’re talking past each other at this point, I think,” said Morgan.

“I guess at the end of the day, the mayors said they would get back to us with a proposal. I’m waiting on them for a proposal to take back to the leadership, and we will see what happens,” he added.

Buck told the Business Journal that the cities were indeed putting together a proposal for the county to review.

“We are in the process of putting together a proposal and we need to run that by the mayors, just like we did the last time, and we will do that. Then, hopefully, we can forward that on to Roger. I would like to hope that we would get a favorable response from Roger and the leadership group,” he said.

“It was a pleasure to have Dick (Vander Molen) there. I thought he had some very positive comments. What we really want to take back to that group are suggestions that came from Vander Molen on what he thought would be a good way for us to keep going,” he added.

Buck said he remains optimistic that the cities can reach an agreement with the county.

Morgan, though, didn’t feel the dispute with the cities would be resolved before the end of the year, his last year as chairman. Barring some unforeseeable incident, Vander Molen is all but certain to replace him in the county’s top seat, and that is why he was present at the last meeting.

“We’re going to start the transition,” Morgan said.

Who captures the capture?

The tax-increment financing authorities in the cities that are in the midst of a jail per-diem disagreement with Kent County have captured more than $1 million over the last three years from the corrections and detention and senior millages.

County officials contend that the millages shouldn’t be part of a capture because voters approved specific uses for those tax dollars and economic development isn’t one of them.

Here is a city-by-city snapshot of that capture.


City

Millages
Capture

Millages
Capture

Millages
Capture

Three-Year
Total

Grand Rapids 

    $324,549

     $279,376

    $237,550

$841,455

Walker

$41,871

$40,167

$29,246

$111,284

Grandville

$22,528

$20,249

$17,793

$60,570

Wyoming  

$299

  $0

  $0

  $299

Kentwood  

$0

  $0

  $0

  $0

Total  

$389,247

 $339,792

 $284,589

    $1,013,628

 

Note: Numbers denote the amount of revenue captured from both millages.

Source: Kent County Ad Valorum Tax Roll for 2005, 2006 and 2007

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