2005-2006
Members of the
Grandville City Council:
The significant
fiscal challenges of recent years are continuing for municipalities
in the State of Michigan. In
fact, in the past year, the situation for most cities and villages
has gotten worse. Further
cuts to statutory revenue sharing payments to local units of
government have been proposed by the State Legislature in addition
to a string of previous such cuts and on top of other existing
fiscal pressures such as fee increases, regulatory mandates and
quickly rising employee benefit costs, especially those associated
with health care. The
result is that, once again, many municipalities are contemplating
the possibility of additional service cuts as they struggle to
balance their budgets.
As has often been stated before, the City of
Grandville is not immune to these fiscal challenges.
In fact, since 1999 deficit budgets and eroding undesignated
fund balances have been an annual occurrence.
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, 2005 and ending on June 30, 2006 once
again maintains existing levels of service provided by the city but
introduces no new or expanded service levels and authorizes no
increase in staff positions. In
addition, it defers some recommended expenditures in the hope that
the State of Michigan’s economic health and revenue picture may
improve in the future.
The total
appropriation recommended for all funds for the 2005-06 fiscal year,
excluding transfers between funds, is $19,126,880.
The plan as presented continues for the third consecutive
year exactly the same General Fund operating millage rate of 8.454
mills per $1,000 of taxable valuation.
This is the second lowest millage rate levied by the City of
Grandville in the last 30 years and is lower than all but one of the
Kent County cities that do not levy an income tax.
The sections that
follow contain an overview of select programs and their proposed
budgets:
General
Fund
General Fund
revenues are projected to total $7,956,032 in the 2005-2006 fiscal
year. The majority of
general fund revenue comes from property taxes (57.8%).
The percentage of general fund revenues provided by the
Federal and State governments (18%) continues to slide.
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 $8,915,966.
This is a decrease of 5.2% from budgeted expenditures in the current
fiscal year.
Police
Department
Police Department and Dispatch Center budgeted
expenditures total $3,036,906 or approximately 33.9% of total city
General Fund expenditures. The
Police Department provides a full range of law enforcement services
including a Detective Bureau and Community Policing Unit including a
full-time Police School Liaison Officer jointly funded by the city
and the Grandville Public School District.
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 $845,264 or
approximately 9.5% of total city General Fund expenditures.
Fire Department staffing will be reduced by one full-time
position in this fiscal year.
Parks
and Recreation
Budgeted Park and
Recreation capital projects include non-motorized trail improvements
and a continuation of upgrades to backstops and fencing at the Aaron
Street Little League complex. The
city also intends to seek Kent County approval to utilize Community
Development Block Grant funding to create a new neighborhood park in
the northeast portion (Lee Street) of the city.
Special
Projects
The 2005-2006
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 Century Center, 44th Street, Prairie,
Viaduct, Ivanrest and Spartan Industrial Drive.
Eight local streets will be resurfaced including portions of
Timberlane, Barrett, 31st, Peck, Earle, Elwood, Sanford
and Wimbledon.
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 $2,591,587.
·
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.
Water
The Water system
is comprised of two funds. The
Water Fund is the operating fund for the system with a budget of
$1,208,773. The
Water Improvement & Extension Fund accounts for long-term
Capital improvements, debt retirement, interest expense and
depreciation reserves. This
fund has a budget of $849,000. Current
city water rates are $1.53 per thousand gallons.
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.
Summary
The Fiscal Year
2005-2006 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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