2004 / 2005
Members of
the Grandville City Council:
Significant
fiscal challenges continue this year for cities, villages and
townships in the State of Michigan
.
The State’s
strained revenue situation has resulted in cuts to statutory revenue
sharing payments to local units of government and it is clear that
further reductions to this crucial municipal funding source are very
much a possibility. Local
governments have also recently seen new fee increases, regulations,
accounting requirements and mandates that result in significant and
unavoidable expenditures. The
resulting shrinkage of municipal fund balances, combined with
continued low interest rates earned on investments, further erodes
local government revenues. Many
municipalities have been forced to consider service cuts, staffing
freezes or reductions and millage increases to respond to these
circumstances.
The City of
Grandville is certainly not immune to these fiscal challenges.
Fortunately, however, the city has been able to temporarily
absorb, to a limited extent, this strain without the necessity of
cutting services to the community.
The following recommended financial plan for the fiscal year
beginning July 1, 2004 and ending on June 30, 2005 maintains all of
the existing levels of service provided by the city but introduces
no new or expanded service levels and authorizes no increase in
staff positions.
The total
appropriation recommended for all funds for the 2004-05 fiscal year,
excluding transfers between funds, is $18,507,903.
The plan as presented continues the same General Fund
operating millage rate of 7.2990 mills per $1,000 of taxable
valuation and the existing levy of 1.1550 mills dedicated solely to
long-term funding of the major and local street system.
The total city millage rate levied for Fiscal Year 2004-05 including
the street levy continues to be 8.4540 mills.
This rate is lower than all annual city millage rates levied
from 1975 through 1999.
The City has
also budgeted for a $1,500,000 transfer of excess fund balance from
the Water funds to the General Fund.
A 2004 water rate study identified these excess funds and the
transfer has been reviewed by the City attorney and the City’s
audit firm.
City water rates
($1.43 per thousand gallons) and sanitary sewer rates ($1.86 per
thousand gallons) remain unchanged from last year, however, in
February 2004 the City eliminated a $0.09 per thousand gallons water
charge to reflect the retirement of water tank bond debt.
The sections
that follow contain an overview of select programs and their
proposed budgets:
General
Fund
General Fund
revenues are projected to total $9,241,896 in the 2004-2005 fiscal
year. The majority of
general fund revenue comes from property taxes (58.1%) and federal
and state shared revenues (17.9%).
The General Fund
provides a wide array of city services including police, fire,
district court, parks and recreation, cemetery, general
administration and others. General
Fund expenditures are budgeted at $9,061,447.
This is a decrease of 4.8% from budgeted expenditures
in the current fiscal year.
Police
Department
Police
Department and Dispatch Center budgeted expenditures total
$2,926,274 or approximately 32% of total city General Fund
expenditures. Departmental
strength continues this year at 29 full-time officers and six
civilians.
Fire
Department
Fire and 24
hour emergency medical response budgeted expenditures total $887,593
or approximately 9.7% of total city General Fund expenditures.
Parks
and Recreation
Budgeted Park
and Recreation capital projects include a multi-purpose facility,
restrooms at Calvin Crest Park and baseball field improvements at
the Aaron Street complex.
Special
Projects
The 2003-2004
budget contains funding to continue city involvement in such
programs as the Grand Valley Metropolitan Council, REGIS, Michigan
Municipal League, Right Place Program, Community Access television
and the Grandville Chamber of Commerce.
Major
and Local Streets
Primary activity
in the Major and Local Street Funds continues to emphasize the
improvements necessary to maintain the integrity of Grandville’s
street system. The most
significant projects are the reconstruction of portions of Chicago
Drive, Prairie Street and 44th Street east of Ivanrest
Avenue. Nine local
streets will be reconstructed including portions of Harvest, Carmel,
Wallace, Sandcrest, Maple, Taplin, Church, Barrett and Higgins.
Wastewater
Our Wastewater
budget comprises three Funds:
·
The Wastewater
Collection System Fund is used to account for operations directly
related to the City of Grandville and supported solely by City
residents.
·
The Wastewater
Operations Fund is the primary operating fund for the Wastewater
system and is supported proportionally by Ottawa County users of the
system. The plant has
recently completed an extensive maintenance and renovation program
prior to re-licensing. The
total budget for this fund is $2,730,725.
Wastewater rates will remain stable this year.
·
Capital improvements
for the Wastewater System. Debt
retirement, interest expense, and depreciation reserves are budgeted
for in this fund. An
engineering study is anticipated to determine adequacy of fund
reserves in light of future capacity needs.
Future rates will be adjusted based on this study.
The current budget is $967,325.
Water
The Water
system is comprised of two funds.
The Water Fund is the operating fund for the system with a
budget of $1,184,891.
The Water Improvement & Extension Fund accounts for
long-term Capital improvements, debt retirement, interest expense
and depreciation reserves. This
fund has a budget of $952,925 excluding the transfer to the General
Fund of $1,500,000 of excess fund balance.
Water is
purchased from the City of Wyoming.
Even though wholesale water rates continue to rise, the
City’s water rates were reduced at the end of the last fiscal year
to reflect the termination of debt charges for the city’s water
tank.
General
Debt Service Fund
The Debt
Service Fund provides for the payment of the Library Building bonds
and interest. A General
Fund transfer of $265,000 will be necessary to provide for these
payments.
Summary
The Fiscal
Year 2004-2005 Financial Plan for the City of Grandville is a
product of months of considerable effort by many individuals
beginning with the input and analysis of staff members at all levels
of the organization and continuing through the final decisions of a
City Council that values strategic planning and is committed to our
community’s quality of life and efficient stewardship of public
funds. My appreciation
goes to all involved in this process and, in particular, to Finance
Director Tom Guinther for his budget leadership.
Respectfully
Submitted,
Kenneth D.
Krombeen
City Manager
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