County to determine fiscal impact of merger

September 30, 2011
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Grand Rapids City Manager Greg Sundstrom shared the city’s position on the One Kent Coalition’s effort to merge the city and county last week with members of Kent County’s consolidation subcommittee.

At the same time, the subcommittee, comprised of commissioners, administrators and department heads, agreed to hire the W.E. Upjohn Institute for Employment Research to analyze and evaluate the potential cost savings from and the economic impact of One Kent’s proposal.

The scope of the institute’s work will involve creating a comparison of the economic performances from previous consolidations and identifying the current services the city and the county offer that could be replicated by a new metro government. The economic-performance portion of the project would be due Feb. 1, in time for the county’s annual trip to New York to meet with the credit-ratings agencies. The services side of the work would be due by March 31.

“They will look at intergovernmental consolidation elsewhere. What they’re going to look at is the business climate,” said Mary Swanson, assistant county administrator, of Upjohn’s role.

The subcommittee felt the work needs to be done because One Kent hasn’t provided those figures and it will cost the county $15,000 to get it done. County Administrator and Controller Daryl Delabbio said a request to fund the research will go to the county’s Finance Committee, which meets this week.

Commissioner Jim Saalfeld said a need also exists to find out what it will cost to merge the governments. One Kent has put a price tag of $10 million on the process, which Saalfeld said was too low. He suggested the city and county come up with an estimate. But Delabbio said any figure the county comes up with may not be seen as being credible by those outside the government.

“If someone wants to attack it, they better show why it’s not credible,” said Saalfeld. “When people start putting numbers out there, it’s our responsibility to respond.”

The subcommittee also made a few adjustments last week to the makeup of the committee that will look into finding efficiencies in government. Three county commissioners will serve on it instead of two, and two city commissioners will have seats instead of one. The two spots for a local business leader and a chamber of commerce official will be narrowed to a single seat and one seat will go to a nonprofit. Commissioner Dan Koorndyk, who chairs the subcommittee, wants members to send him names of individuals who they feel could serve on the committee. “I’ve had a couple of people call me,” he said.

Sundstrom told the subcommittee that the city is willing to talk with anyone at any time — including the coalition — about consolidation.

“We’re open to the concept,” he said.

But Sundstrom also indicated that One Kent didn’t properly approach the city with its merger idea. “Why do you think we’re the enemy?” he rhetorically asked of the coalition, which wasn’t present at the meeting. “We’re confused about that at City Hall.”

Sundstrom added that the city’s long-term strategy is to consolidate as many services as possible that would result in cost savings for taxpayers. “We think that’s the best approach,” he said.

He also took issue with under-the-radar reports that the city is eager to consolidate so it can dump its legacy costs on someone else.

“Frankly, I’m offended by that because we’re a well-run organization,” Sundstrom said. “I’m not interested in snookering you into dumping our costs on you.”

Sundstrom said he was unequivocally interested in having two city officials on the committee, as he considers the county to also be a well-run organization. “Grand Rapids is happy to have you lead. We don’t have to be in charge,” he said.

Although a legal analysis by the city on the coalition’s draft legislation to merge the two came up with 58 concerns last week, Sundstrom said he thought the biggest flaw in One Kent’s merger concept is believing a consolidation would let Grand Rapids be promoted for economic development purposes as a city with a population of more than 602,000 — the total population of the 30 municipalities in the county.

“Really, in the end, that’s rather meaningless. It makes more sense to (merge) city-to-city and township-to-township,” he said, instead of tying the city with the county where services differ. “Maybe One Kent did us a favor by waking us up,” he added, “as the world has changed.”

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