Last week Grand Rapids city commissioners adopted a new fiscal-year budget, approved a host of other city-related spending plans, established a new millage rate for the 2014 year that begins next Monday, and gave a green light to a new millage request voters will see this fall.
The city’s budget for general operations, which covers most of the city’s services, is $118.3 million. The police department will get $43.7 million of that, while the city’s fire department will receive almost $28 million.
Revenue from income taxes is expected to total $62.2 million. Income from property taxes is projected to reach $11.2 million. The city expects to get $14.4 million in revenue sharing from the state and $30.3 million from additional sources.
“We have a very strong fiscal plan. For the first time in several years, we’re expecting a surplus — and what a beautiful thing that is,” said City Manager Greg Sundstrom.
In all, commissioners adopted a spending plan that totals $382 million, including a $2.1 million budget stabilization fund, a $3.2 million buildings inspection fund and $4.6 million for community development.
Commissioners also approved the new $15.4 million fiscal-year budget for the Downtown Development Authority. The DDA anticipates spending $7.3 million from its debt tax fund, with much of that going to pay the bondholders who helped finance Van Andel Arena and the parking ramp that serves the Public Museum. DDA Executive Director Kristopher Larson said about $1.4 million of that debt-fund revenue will go to Grand Rapids Public Schools next year.
The DDA also is looking to spend $6.6 million from local tax revenue on downtown improvements and $1.5 million from its non-tax revenue fund, which is largely fueled by the parking revenue the DDA earns from its six downtown lots.
Commissioners also approved the $3.9 million budget for the Brownfield Redevelopment Authority. About $3.1 million goes to operations. Another $870,000 comes from the debt fund and is paying the bonds the authority issued last year to improve the streets around the Downtown Market.
City Economic Development Director Kara Wood said 92 percent of the tax-increment revenue the authority receives goes to developers who build projects on brownfields, and the authority has helped to raise the taxable value of properties in the city by $92 million.
At the same time, commissioners approved the Economic Development Corp.’s budget of $286,204 for the fiscal year. Most of that revenue, $150,000, is expected to come from tax reimbursements. Its largest expense, $207,000, will pay for contractual services.
“The Economic Development office no longer gets general-fund revenue,” said Wood.
Budgets for the SmartZone and Monroe North Tax Increment Finance Authority also were approved. Commissioner Rosalynn Bliss asked Larson if the Monroe North TIFA could be rolled into the DDA due to its proximity to the DDA. Larson said he didn’t think that could be done because the TIFA was created by a different state statute than the law that originated the DDA.
Commissioners also established the property tax millage rate at 8.1719 mills, up slightly from last year’s rate of 8.1716 mills. City CFO Scott Buhrer said the average residential tax bill will be $364.40, a figure based on the average taxable value of $44,592 for homes in the city. Both averages are down from last year.
Last year, the average residential tax bill in the city was $372.33. Two years ago, it was $399.34 when the city’s millage rate was 8.37 mills and the average home’s taxable value was $47,704.
The city uses 2.8570 mills of its 8.1719 millage rate for its general budget. It is authorized by the state to establish a millage rate up to 9.3430 mills. Besides general operations, the city millage supports the capital reserve fund, refuse collection, the library system and what the city calls “promotional uses.”
The bills will go out July 1, and some will contain the county’s dedicated millages for the jail and services for seniors, which are normally billed in December. The city decided to include those millages in the summer if the county millage total is less than $100 on a city taxpayer’s bill. City Treasurer Al Mooney said the change will save the city money.
Commissioners also approved a millage request to fund parks, pools and playgrounds in the city and set Nov. 5 as the date voters will decide whether to add another .98 mills for seven years to their property-tax bills. The city estimated a “yes” vote would raise about $4 million in the first year.
Sundstrom said the city will create a spending plan by August to let voters know exactly what they’ll be voting for in November.
“It’s largely for capital so we can make long-needed improvements to our parks,” he said. “We need to make sure we invest our dollars as wisely as possible.”
Commissioner Walt Gutowski said a “yes” vote at the ballot will not mean the commission will remove park funds from the city’s general fund.
“This will be in addition to that,” said Mayor George Heartwell of an approved millage request.
The city’s ballot measure now goes to the state Attorney General’s office for final approval.