Westside CID underscores need for county economic policy review

November 28, 2014
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As the Thanksgiving celebrations drew near, the Kent County Board of Commissioners “opted out” yet again from participation in Corridor Improvement District economic development initiative, this time for Grand Rapids Westside district, which encompasses three business districts to create the largest CID in the city.

At issue here is the county board’s blind institutionalization of a policy created as the Great Recession loomed in 2007. None save a few of the county board members have been willing to review and renew its economic development policy, even as it realizes the financial benefits of those improvement districts built on the backs of business owners. Those business owners are not isolated to one particular location and are represented across Kent County — a point made to counter the frequent tunnel vision of believing any one commissioner represents a particular district rather than the success of the entire county.

The pre-Thanksgiving vote to opt out of the district saw only county commissioners from Grand Rapids oppose the opt-out: Carol Hennessy and Jim Talen.

County board members in January 2013, including then finance committee chairman Harold Voorhees, suggested the commissioners review the policy in February. It didn’t happen.

In July 2013, Hennessy asked if a change could be made to the county’s economic development policy for the coming fiscal year that would allow some tax-capturing entities, like corridor improvement districts, to collect a portion of the county’s property tax. County Administrator Daryl Delabbio said the policy would remain the same. In comments reported in the Business Journal, Delabbio promised Hennessy: “We believe it meets our needs, but if you believe it needs to be changed, we will look at it.” It didn’t happen.

The county in the distant past has reviewed requests and at least debated individual merits and returns on the investment. State law allows improvement authorities to capture some portion of future increased property tax revenue for a specified time. District improvements have, in every case, proven to add value to the properties within the district. The increased values created by the district members are returned to the county based on the increasing property values created by the district members.

Qualifications for any district are lengthy including commercial space that has existed for a minimum of 30 years, mixed use and high-density zoning — all of which provide greater returns on the district improvements.

The tax captures are comparatively minor but enough to fuel investment (and that’s the point). For example, the Creston Neighborhood Association, which was actively involved in formation of the North Quarter Corridor Improvement Authority, noted in 2013 that the capture after 30 years would be $88,000, an amount the county will see returned to its coffers as the district property values continue to go up.

As Hennessy has pointed out, “A lot has changed since the county adopted its policy.”

Despite county action, the Westside CID group is commended for its volunteer efforts and partnerships across the stretches of three business districts and neighborhoods including West Fulton, Stockbridge and West Leonard, and the overall community enhancements to which they aspire.

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