Report Slams State And Praises City


    Editor’snote: This is the first story in a two-part series examining the Michigan Land Use Institute’s “Follow the Money” report.)

    GRAND RAPIDS — The report is a stinging criticism of the economic development policy used by the state. It argues that the Lansing plan has encouraged sprawl throughout the Lower Peninsula and has not paid enough attention to the core cities.

    At the same time, the report champions Grand Rapids for its economic revitalization efforts and calls the state’s second-largest city “Michigan’s Come-Back City.”

    Written by the Michigan Land Use Institute, “Follow the Money” claims to explain how public investments have accelerated sprawl across the state’s once-pristine regions, ignored infrastructure problems in cities and wasted billions of taxpayer dollars on bad projects. As cited in the report, the spending patterns between rural acres and urban locales are striking.

    In 2001 alone, the report said state and local governments spent $10 billion on items like roads and sewers to assist projects in largely rural areas. That same year, however, the state dedicated only $507 million and just $1 billion in tax credits to redevelop old industrial sites in core cities and suburbs.

    “We spend $10 billion directly in public investments for economic development, when we hear we don’t have the money. That number has been very stable through the 1990s and into the 2000s,” said Keith Schneider, MLUI deputy director and author of the report.

    “We also spend several hundred million dollars more a year in tax abatements, economic incentives, loans and direct job placement-type grants,” he added.

    It’s not just the denial from Lansing that money exists for other purposes or the amount that is spent on economic development each year that rankles the MLUI; the institute also is disturbed about where that money goes.

    “The majority of that money, 55 to 60 percent of it, is going outside of the core suburban areas and cities, and is going to the fastest-growing suburbs and the exurbs. So there is a mismatch. The existing older communities are being penalized and the newer communities are being rewarded,” said Schneider.

    According to the institute, this policy pushes developments into the countryside and forces residents of metro areas to pick up the tab.

    “If you live in an older suburb or city, you’re paying twice. If you live in Grand Rapids, you’ve helped to invest in the tremendous development growth in the urban core that we’ve documented in the report. You pay there, but you’re also paying to ensure that Hudsonville grows,” said Schneider.

    Schneider said Grand Rapids provides one of the best examples of how a government should invest in its economy and in the quality-of-life issues of its residents. Nearly $2 billion has been spent here by the public and private sectors since 1990.

    “Those investments were planned and are now generating the kinds of economic and quality-of-life returns that you’re seeing in the city. I come here about once every month or six weeks, and I see something every time. It’s awesome,” he said.

    “There has been no story like this in an urban center except for Chicago in the Midwest.”

    Roughly half of “Follow The Money” is devoted to the city’s renaissance. The report also offers 10 tips that will lead to what it calls “prosperity for the state” through better land-use management and public-spending practices. To read the full report, go to

    “The institute and many, many others are convinced that sprawl is detrimental to the economic health of this state for lots of reasons, one of which is it’s fiscally inefficient. The way we grow, we’re not able to pay for it. We can’t maintain the infrastructure we have, and it costs tremendous amounts to re-modernize and to build new,” said Schneider.

    “It cost more to do the S-Curve renovation than it did to build the whole (U.S.) 131.”    

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