City commissioners adopt a handful of budgets

June 25, 2012
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Grand Rapids city commissioners adopted an operating budget last week, validated a three-year special assessment for downtown businesses and gave the Downtown Development Authority the green light to hire a new executive director.

The city will enter the 2013 fiscal year July 1 with an operating budget of $116.5 million, with revenue up by roughly $2 million and spending down by about $2.8 million from this year. Expenses top revenue in the spending plan by nearly $200,000; that gap will be closed by reaching into the fund balance, which begins the year with $8.9 million in the account.

“We are maintaining our promise to public safety and there aren’t any layoffs due to higher costs,” said Commissioner Dave Schaffer.

Commissioner Ruth Kelly said the city’s labor force should be credited for working with city officials to control costs.

“We are actually putting funds where our priorities are,” added Commissioner Rosalynn Bliss.

Commissioners also ratified operating budgets for the DDA ($16.3 million), the Economic Development Corp. ($134,930) and the Brownfield Redevelopment Authority ($3 million).

“We have 28 projects receiving reimbursements at this time,” said Kara Wood, city economic development director and executive director of the brownfield authority. Mayor George Heartwell noted that brownfield projects have increased the taxable value in the city by $65 million since 1998.

Commissioners also established a property tax millage rate of 8.17 mills for the fiscal year, which is slightly down from 8.37 mills this year. The reduction comes from the refuse portion of the tax. City CFO Scott Buhrer said the change, coupled with a lower overall taxable value, would lower the average residential tax bill from $399 this year to $372 next year.

The special assessment commissioners approved will make up the Downtown Improvement District’s budget through fiscal year 2015. The levy will be $616,500 in FY13, $630,500 in FY14 and $642,300 in FY15. Businesses on Monroe Center will pay an additional annual tax of $150,000 for those three years to cover the maintenance and operation of the snowmelt system. Businesses along the Louis Campau Promenade will pay an additional tax of $15,000 each year for the snowmelt system there.

“I think this is a good strategy. This is good planning,” said Commissioner James White in regard to having an assessment for three years.

Commissioners backed the DDA’s selection of Kristopher Larson as the organization’s next executive director and gave the board the authority to negotiate a total compensation package of up to $160,000. Larson has served as vice president of Downtown Long Beach (Calif.) Associates for more than three years. He is expected to replace Jay Fowler, who is retiring from the post he held for more than nine years.

“I am absolutely thrilled that we have a very strong candidate for our next executive director. He has enthusiasm, energy and passion for downtowns,” said Kayem Dunn, DDA vice chairwoman and head of the executive search committee.

But Commissioner Walt Gutowski said the compensation package being considered for Larson is higher than any other city employee except City Manager Greg Sundstrom. Dunn said the salary the board is likely to offer Larson will be 5 percent higher than what Fowler was paid. “But my initial estimation is we will be under $160,000,” she said.

Commissioners also agreed to the creation of Downtown Grand Rapids Inc., a new entity that will lead and coordinate the activities of the three boards that oversee the downtown business district: the DDA, the DID and the Downtown Alliance. “It creates a platform where the community can create a vision,” said DDA Chairman Brian Harris.

“This is a bit of a historic moment. This is a transformation of a downtown function, truly,” said Heartwell, who represents the commission on the DDA.

City commissioners also approved a brownfield for the former Miller Products location at 601 First St. NW. Rockford Construction plans to renovate the property into its new headquarters at an estimated cost of $4.7 million. If the state approves the project, Rockford will be able to capture $1.1 million in tax-increment financing for cleaning up the site and for making public improvements to the property.

“This project will be a combination of renovation and new construction at the site. It’s estimated that Rockford Construction will transfer 85 employees from Cascade Township to the site,” said Wood.

“It’s wonderful to get Rockford back in town,” added Heartwell.

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