City commission approves budgets for economic development boards, commissions

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Courtesy city of GR Economic Development Department

The Grand Rapids City Commission adopted 12 budgets for the 2022 fiscal year recommended by various downtown and neighborhood boards.

The budget approval provides reinvestment of just over $43 million for community and economic development, including almost $2 million in investment through six corridor improvement authorities and a neighborhood business improvement district. This will increase investment in neighborhood business districts and neighborhoods of focus.

The Grand Rapids Economic Development Department administers 10 separate boards and authorities, and Downtown Grand Rapids Inc. administers the Downtown Development Authority and Monroe North Tax Increment Finance Authority.

Economic Development Director Jeremiah Gracia told the city commission his office supported 10 major development projects over the past year. The success of those projects includes more than $179 million in leveraged private investment, the expected creation and retention of 887 jobs at an overall average wage of $22.59 per hour and 259 new housing units.

Additionally, the economic development office continues to implement the Equitable Economic Development and Mobility Strategic Plan in collaboration with the Mobile GR and parking services department. While the pandemic caused challenges in accomplishing some of these strategies, the department made considerable progress on each of the five near-term priority areas.

The economic development team also:

  • Launched a new website at GrowGR.org with enhanced accessibility and concise information to increase the diversity of participants in city programs, including incremental developers and business owners of color.
  • Implemented the economic development inclusion plan Jan. 1 with more than $2.5 million of commitments already made to minority-owned business enterprises, woman-owned business enterprises and micro-local business enterprises. The plan’s focus is to reduce racial and gender gaps that exist in the construction industry and increase economic prosperity and wealth creation by providing greater access to contracting opportunities.
  • Approved 21 façade grants through five corridor improvement authority (CIA) programs for more than $210,000 of matching grants.
  • Invested in $85,000 of public art in CIAs resulting in 25 murals or other forms of art.
  • Issued the SmartZone Incubator RFP to streamline services and achieve alignment between partner organizations to enhance high-technology business success.
  • Modified local brownfield revolving fund policy to enhance support for first-time developers and projects located in the neighborhoods of focus.
Courtesy city of GR Economic Development Department

“These investments align the efforts of our economic development team with the city’s strategic plan,” Gracia said. “It aligns with the goal of advancing equitable access to opportunity. Our office also will continue to collaborate on implementation of the recommendations of the city’s economic recovery and resiliency workgroup and identify impactful investments and programs that will enhance economic prosperity and affordability and reduce disparities in the community.”

The economic impact of the city’s annual investment is multiplied in the FY2022 budget by the recommended investment of $19.5 million in housing and community development services and another $96 million in all types of capital investment in water and sewer infrastructure, parks, vital streets and sidewalks, cemeteries and community facilities.

The economic development department’s various boards FY2022 budget requests more than $21.1 million in resources. Each draws upon tax increment revenues as its primary source of revenue. Tax increment revenues comprise two-thirds of the budget requests, as well as most of the existing fund balance appropriated in the budgets.

Altogether, these account for approximately 90% of budgeted revenues. State grants, various fees, a special assessment and other smaller sources provide the remainder of the revenue.

The city commission approved the following FY2022 budgets:

  • Brownfield redevelopment authority – $15,722,514, which includes the authority’s operating fund and local brownfield revolving fund. The FY2022 budget reflects the continued growth of the program with four new projects added in 2020. Since 2013, it has approved 55 projects, representing commitments of over $1.3 billion in private investment and 4,281 new jobs. $245 million of tax increment financing, and over $48 million of grants and loans from the state of Michigan and the U.S. Environmental Protection Agency have contributed to the success of the program. Because each project results in a financial agreement between the BRA and the developer, the work on projects approved in 2021 will continue for many years to come. Staff currently administers 62 active projects with an additional 15 projects approved and pending commencement or completion of construction. Staff also administers the development agreements between the Downtown Development Authority (DDA) and various developers, which is currently an additional 14 agreements. The DDA directly funds this work.
  • Downtown Development Authority – $21,724,900 to further implement the recommendations from recently completed planning initiatives. Those include the Grand River Governance organizing initiative, the Heartside Quality of Life Implementation Plan, the Disability Advocates of Kent County and Common Notice Report, and the Downtown Streetspace guidelines. Funding also is recommended to complete and initiate major capital improvements to downtown public spaces, including Ecliptic at Rosa Parks Circle and Lyon Square. Carry-forward priorities from previous years include completing Grand River edge infrastructure improvements, implementation of pedestrian and bike infrastructure, continued funding to support retail business attraction and building on the success of the World of Winter. Lastly, as the COVID-19 pandemic continues to create uncertainty, the unspent portion of the $1,000,000 that was allocated in FY2021 (estimated at $100,000 as of March 31) will be carried forward into FY22 to continue to provide flexible funding for the ongoing communitywide recovery effort.
  • Grand Rapids Economic Development Corporation – $122,956 for ongoing operations (approximately $68,000) related to administration of various business and real estate development programs, as well as strategic plan implementation.
  • Grand Rapids SmartZone Local Development Finance Authority – $3,317,800 to fund previously approved projects, future strategic priority initiatives, trade shows and marketing. The most significant expenditure is $2.5 million associated with the current incubator request for proposals, of which, up to $1.5 million would be for operations and programming and $1 million for startup and capital costs.
  • Michigan Street Corridor Improvement Authority – $285,000 to continue projects related to design, including its facade improvement program. The Michigan Street CIA also renewed its corridor manager service agreement for FY2022.
  • Monroe North Tax Increment Finance Authority – $771,619 to carry forward priorities that span multiple fiscal years. Among them is funding to further recommendations from the river governance planning initiative, pedestrian and mobility infrastructure improvements, and further improvements to Canal Street Park to implement the River for All guidelines.
  • North Quarter Corridor Improvement Authority – $75,000 to fund projects related to the organization, including corridor management and design. This includes the creation of a facade improvement program. The North Quarter CIA also intends to continue the maintenance of the Plainfield Avenue Bio-Retention Islands using the special improvement sponsorships collected by the city over the past nine years.
  • South Division-Grandville Corridor Improvement Authority – $116,500 to fund projects related to the organization, including corridor management. The South Division-Grandville CIA also plans to continue its facade improvement program and to provide support to its business associations.
  • Southtown Corridor Improvement Authority – $717,008 for projects related to design, including the continuation of its facade improvement program, landscaping and public art. Additionally, the Southtown CIA has approximately $238,000 in prior year committed funds that include facade improvement projects and an ornamental lighting and street furnishing project in the Seymour Square Business District.
  • Uptown Business Improvement District – $134,004 to continue projects related to design, including the Uptown Ambassador Program and landscape maintenance. The Uptown BID also plans to provide administrative support to its four business districts.
  • Uptown Corridor Improvement Authority – $329,600 for projects related to the organization, including corridor management and design. It also plans to continue its facade improvement and public art programs.
  • West Side Corridor Improvement Authority – $292,000 for projects related to design, including a facade program and gateway signs. The West Side CIA also plans to continue its outdoor furniture grant program to support social zones in the district and provide financial support to each of its business associations.

Members of the public continue to have an opportunity to provide feedback on the FY2022 Preliminary Fiscal Plan at the upcoming Tuesday public hearing and May 20 special city commission meeting.

Residents already had a chance to weigh in on budget priorities at the May 4 budget Review workshop, May 6 virtual budget town hall and the May 11 budget review workshop.

 

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