Economic Development, Real Estate, and Retail

DDA approves FY2019 budget

In addition to supporting five GR Forward goals, DDA also approved a retail innovation/incubation grant.

June 15, 2018
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The Grand Rapids Downtown Development Authority has hit the final step in the 2019 budget approval process.

The DDA voted unanimously to approve its budget for fiscal year 2019 during a regular meeting June 13, and with GR Forward now an approved amendment to the city’s master plan, Downtown Grand Rapids Inc. has budgeted for projects to align with the plan.

Previous Business Journal reporting identified DGRI’s budgeted expenditures for projects in alignment with the five goals in GR Forward:

1. Restore the river as a draw: $2,138,000

2. Create a true downtown neighborhood home to a diverse population: $2,510,000

3. Implement a 21st century mobility strategy: $2,637,204

4. Ensure job opportunities and ensure vitality of the local economy: $175,000

5. Reinvest in public space, culture and inclusive programming: $2,556,000

The DDA also approved a retail innovation/incubation grant, in accordance with Goal 4, to grow more and better jobs.

According to a memorandum from Andy Guy, DGRI chief outcomes officer, to the DDA, the GR Forward planning process revealed a high demand for more retail options in downtown Grand Rapids, with a focus on products and services that are underrepresented in the downtown area.

Community feedback also noted a demand for more focus on building businesses owned by women and minorities.

“Really, the overarching goal is just to build a great downtown, but also make sure that we’re positioning downtown for goods and services that we know we’re going to need in the future as consumer demands and population demographics change,” Guy said.

To advance this goal, the DDA updated its financing plan in October 2016 to more intentionally support retail attraction and, in June 2017, adopted a budget that included a retail innovation fund.

Most recently, the DDA developed and released a request for proposals to solicit retail businesses into the downtown area in March.

Guy said DGRI received several calls of interest after putting out the RFP and recommended a joint proposal from Tamales Mary, a Mexican restaurant in Wyoming, and Move Systems, a company that manufactures mobile food systems in Walker.

The joint proposal is to introduce Tamales Mary to the downtown street food scene via Move Systems’ units. Guy said the pilot program would deploy a kind of “mobile food café” in various locations downtown, primarily during lunchtime.

“We’re also looking potentially to do some night service, as well, to take advantage of the entertainment scene,” he said.

The six-month pilot program would cost $61,150 and include customization of the mobile food unit, lease fees, licensing and permitting fees, and operational fees for Move Systems. About $31,000 from the DDA’s retail innovation fund would be used to underwrite a portion of the fees.

“The thought in the request for ($61,150) was to create some flexibility to continue (the pilot) and go through the winter or be in a position to come back very quickly in the summer as we start to build a customer base,” Guy said.

After the pilot phase, the business owners, DGRI and the GR Forward Goal 4 alliance will evaluate the pilot performance and evaluate the next steps.

The DDA approved the pilot program, but Mayor Rosalynn Bliss drew attention to another Goal 4 agenda item, recruiting a major office tenant to downtown.

“I think we can look at a coalition to really look at where the opportunities are based on the work we did and what we learned through the Amazon RFP process,” she said.

Grand Rapids was kicked off the list of potential sites for Amazon’s second headquarters in January after the city, DGRI, The Right Place and other partners developed a pitch to draw in the online retail giant.

Birgit Klohs, president and CEO of The Right Place, previously told the Business Journal the process did reveal areas of opportunity for improving collaborative downtown recruitment efforts.

“As much as this process helped identify our major assets, it also helped us to assess our gaps and where we can continue to improve,” Klohs said.

The Business Journal noted lack of talent and transportation were the key shortcomings in Grand Rapids and West Michigan’s eligibility.

Bliss encouraged the DDA to continue to take a proactive approach in attracting employers to the region.

“Other cities do that all the time,” she said. “When I’m visiting companies and talking to business leaders, they’re talking about other cities trying to recruit them to come to their city, and I just think we should make that a priority at some point this year.”

Tim Kelly, president and CEO of DGRI, said the organization currently is coordinating with The Right Place on a recruitment strategy.

The DDA recommended the FY2019 spending plan to the city commission during a regular meeting May 9, and the city commission unanimously approved the budget May 22.

“(The city commission) was generally very supportive,” Kelly said, “I think everybody recognizes now what we’re doing, which is implementing our strategic plan.”

The FY2019 DDA budget is for the fiscal year beginning July 1, 2018, and ending June 30, 2019. Resources include the local tax increment fund, nontax increment fund, school tax increment and bond proceeds fund.

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