The primary challenge in development of the city budget for Fiscal Year 2008-09 was dealing

with shrinking revenues at the same time that expenses are growing. Total General Fund

revenues for the coming year are projected to be flat to slightly decreased primarily due to

stagnant growth in property values and anticipated reductions in transfers from the State of

Michigan due to lower sales tax collections. Meanwhile, city General Fund expenses face

The following financial plan for the fiscal year beginning July 1, 2008 and ending on June 30,

2009 restrains General Fund expenditures to a less-than-inflationary level, maintains the

projected General Fund deficit through use of available undesignated fund balance. The total

appropriation recommended for all funds, excluding transfers between funds, is $21,515,477.

The sections that follow contain an overview of select programs and their proposed budgets:

General Fund

General Fund revenues are projected to total $8,678,946 which is .013% less ($1,109) than

budgeted General Fund Revenues for the current fiscal year. The majority of general fund

revenue comes from property taxes (63%). The percentage of general fund revenues

provided by the Federal and State governments (16%) continues to slide. Revenue sharing

from the state of Michigan is expected to decrease by 3% over the current year.

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 $9,055,698. This is a slight inflationary increase of 2.04% from

budgeted expenditures in the current fiscal year. The projected deficit of approximately

$375,000 (assuming full expenditure of all General Fund line items) will be covered by using

available fund balance.

Police Department

Police Department budgeted expenditures total $3,114,313 or approximately 34.4% 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 that

includes a full-time Police School Liaison Officer jointly funded by the city and the

Grandville Public School District. Authorized departmental strength this year is 26 full-time

officers and two full-time and one part-time civilian.

Fire Department

Fire and 24 hour emergency medical response budgeted expenditures total $943,488 or

approximately 10.4% of total city General Fund expenditures. The Fire Department will

maintain its staffing level in this fiscal year.

Parks and Recreation

Budgeted Park and Recreation capital projects include additional new fencing for the baseball

fields at the Aaron Street Little League complex and picnic tables and benches for area parks.

Special Projects

The 2008-2009 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 in Major Streets are for a portion of Ivanrest Avenue, a portion of

Rivertown Parkway and a pedestrian bridge over Buck Creek on Canal Avenue, which will

enhance safety and allow greater access downtown from the Buck Creek Trail.

Clean Water & Water Systems

The City’s Clean Water System budget is comprised of three departments:

directly related to the City of Grandville and supported solely by City residents.

Clean Water System and is supported proportionally by Ottawa County users of the

system.

improvements, debt retirement, interest expense, and depreciation reserves.

The total expense budgeted for the Clean Water System Fund is $5,305,356 which includes

the engineering costs of $1,000,000 for the beginning stages of a $4 million capital project to

provide increased capacity at the Clean Water Plant. This amount will be paid entirely by

Street lift stations and engineering fees of $150,000 for renovations to the existing plant.

Annually a comprehensive rate study is completed and as a result there will be an increase in

sewer charges in the next fiscal year. The commodity charge will increase from $2.17 per

1,000 gallons to $2.74 and Ready- to- Serve charges will increase from $2.37 to $3.05 per

quarter. These increases are largely due to Wyoming’s sewer system rate increase of 14.5%

and the rising cost of utilities, fuel and DEQ permits.

The Water system is comprised of two departments. The Water Operations Department is

used to account for regular operations and the Water Improvement & Extension Department

accounts for long-term Capital improvements, debt retirement, interest expense and

depreciation reserves.

The total expense budgeted for the Water Fund is $2,351,401 and includes water main

replacements in conjunction with street repaving on Shoshone, Earl, Sioux Court and S. Big

Spring.

The same annual comprehensive rate study that is completed for sewer rates is used to

determine water rates. The result of this year’s study showed there is a need to increase water

charges in the next fiscal year. The commodity charge will increase from $1.84 per 1,000

gallons to $1.89 and Ready- to- Serve charges will increase from $6.81 to $7.51. The

necessity for this rate increase is a direct result of Wyoming’s wholesale water rate increasing

by 16% for the upcoming year.

Summary

The Fiscal Year 2008-2009 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 Tammy Aue for her budget leadership.

Respectfully Submitted,

Kenneth D. Krombeen

City Manager