Heartwell Business efforts work

February 5, 2011
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Grand Rapids Mayor George Heartwell gave his eighth State of the City address last Saturday before a welcoming crowd at DeVos Place. He told the Business Journal that his speech has evolved over the years, and said Saturday’s address was a good indication of that change.

“When you first take office, you’re pretty aggressive in the kinds of new initiatives you want to start, and over the years I’ve announced a number of aggressive new initiatives.

“By this time in my tenure as mayor, I’m still working on completing a number of those initiatives that take years sometimes to complete. So you don’t want to add too many new things on top of what you’ve already set out to accomplish,” he said.

“It’s also a chance, as you get further into your term, to look back and see the things that have been accomplished, or the things that still need to be done.”

The mayor pointed out a number of those accomplishments in his address, including a $1 billion investment in the Michigan Street area known as the Medical Mile, establishing a national reputation for sustainability, making the city a nationwide alternative-energy and energy-conservation leader, and strongly supporting economic development in the city to the tune of $1.75 billion in total investment.

Heartwell said those accomplishments and more have made the city a destination for health care, education, and arts and culture.

“It goes without saying this is an election year and I’ve announced my bid for re-election, so I love to take the State of the City address to catalogue what we’ve accomplished over the years.

“It’s remarkable, especially when you put it in the context of a state that has just been flat on its back for the last 10 years”

In his address, the mayor gave five reasons businesses have chosen Grand Rapids for expansion and relocation: the city’s emphasis on sustainability; its welcoming business climate; its quality of life; its expertise at forming public-private partnerships; and its lack of bureaucracy, which leads to practical solutions for businesses.

Heartwell said those are the reasons a company like Kellogg moved the production of its Special K breakfast bars to the city. The firm is investing $18 million into its plant and will create 45 jobs from that investment.

“We want business to grow, so we are liberal in our use of the tools for economic development: brownfield tax credits, Renaissance Zones, industrial facilities tax exemptions and obsolete property tax abatements. In the past year alone, while the state languished in the economic doldrums, our tax tools supported $235 million of new investment in Grand Rapids,” he said.

“Altogether in the past eight years, we have stimulated over $1.75 billion of new development, using these tools, that has resulted in the creation of nearly 13,000 new jobs. In that same period of time, we have also invested another $37 million in economic development through our Downtown Development Authority,” he added.

Heartwell said he wants the city’s business community to take pride in what has been accomplished, especially considering the kinds of investments that have been made. “I also want the business community to take note of the fact that the city is very aggressive in using the economic development tools we have. And we have a (City) Commission now that is solidly behind the use of those incentives and tools for economic development,” he said.

“And I want businesses to understand that they’ve got a mayor and a City Commission that are looking forward and want to grow this economy. We are the envy of the state of Michigan right now in our local economy, not withstanding what a dying news magazine said about Grand Rapids recently. We are a thriving, growing, dynamic city, and the envy of many cities in Michigan. So we’ve got to continue that. We can’t let up.”

But being able to continue on that track may become tougher if Governor Rick Snyder and the legislature reduce the number of incentives the city can use.

“I fully expect that cities are going to see the loss of some of our economic tools that have been important for us, and perhaps a reduction in our revenue sharing, and a potential elimination of statutory revenue sharing. I think (Snyder) wants to do all of that in the first two years of being in office,” said Heartwell.

Still, the mayor said it was important for Snyder to make sure the state’s expenses match its revenues. “We’ve got to get there. We’re braced for it, but it’s going to be tough. It’s going to be a tough couple of years for us,” he added.

Heartwell said he has asked owners of downtown commercial buildings to reduce their energy consumption by 30 percent by 2020. The mayor said a revolving fund would be set up that would allow property owners to borrow at favorable rates in order to make changes to meet the goal. He sees the fund as being supported by banks and foundations, and loan repayments being made with savings from lower energy bills.

“On Wednesday, anticipating my State of the City speech, no doubt, President Obama announced his own “Better Buildings” initiative, offering tax credits and financing for those commercial building owners who make the energy efficiency improvements. Although we are still studying the details of the federal program, it appears that a perfect opportunity exists for us to use the president’s program to leverage our own local investments,” he said.

The mayor said the ongoing transformation of city government will continue this year, and said a highlight of that effort will be the creation of a regional fire authority in partnership with the cities of Wyoming and Kentwood. He hopes to have that process completed a year from now.

“Let me be real clear about what we want to do with this because it’s not simply great big Grand Rapids taking over the fire departments of Kentwood and Wyoming — smaller cities — and managing fire services. It’s about creating something entirely new: a regional fire authority that our three cities will be the first three cities (to have),” said Heartwell.

“I would hope that other cities, and maybe even townships, would come in over time. We would sit at a governance table together as equals in that effort, providing fire services throughout our district. There are some clear and obvious cost savings in that, but that’s not even the first objective. The first objective is the efficiencies of government.”

He said that Grand Rapids and Wyoming save $1.5 million annually from the dispatch authority the cities created last year.

“I’ve got to believe the savings from the fire authority can be even more significant,” he said.

As part of his address, Heartwell named four recipients of this year’s Champion of Diversity Award: Grand Rapids Community College President Steve Ender, former teacher Lupe Ramos-Montigny, retired City Deputy Police Chief James Farris and Community Relations Chairwoman Debra Muller. The mayor cited them as focusing their lives on the city’s youth.

Heartwell also said that 34 businesses thus far have joined his 2010 initiative, the Mayor’s 50, and have hired young people. He said there was room for businesses to join in the effort, and he recognized many of those 34 students.

“Our city’s destination is a great, transformative future that we all share a responsibility for shaping,” he said.

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