City seeks long-term infrastructure funding

Alex Doty • May 1, 2018 at 1:00 PM

Grand Haven officials are pitching proposals for dealing with the city’s long-term infrastructure needs.

City staff recently rolled out a plan that they think is a “sustainable, palatable approach” for long-term investment into the streets, and underground water and sewer lines.

The move is in response to one of the City Council goals for the year.

City officials note that there’s still about $40 million worth of infrastructure work in Grand Haven to be done, even after the city has invested in projects over the past decade with the help of two voter-approved millages.

“They’ve been significant and they’ve gotten a lot of work done,” City Manager Pat McGinnis said. “(But) we’re not going to say ‘mission accomplished’ because we know it’s not nearly accomplished yet.”

McGinnis said that returning to the voters every few years for similar millage proposals might not be a good long-term strategy. As an alternative, city leaders have proposed the possibility of a dedicated long-term, 3-mill levy for infrastructure investment. 

There are currently 2 mills outstanding for infrastructure bond payments — 1 mill each for bonds approved by city voters in 2008 and 2015.

“If you went out and requested a 3-mill infrastructure permission from the voters — a millage vote for 3 mills — you could express it that the first 2 mills are there to cover the outstanding bonds,” McGinnis said, noting that 1 mill generates about $550,000 per year.

Then, in 2028, when the 2008 bond retires, there would be 2 mills to invest in infrastructure. In 2035, when the 2015 bond retires, the city would have 3 mills to invest in new infrastructure work.

“What I’m proposing is some years of austerity between now and then, otherwise you’re going out for more debt,” McGinnis said.

The plan would behave more like a millage renewal than the addition of a new millage, McGinnis explained.

“This does not increase your taxes,” he said. “It leaves them level, but it gives you the promise of future infrastructure resources you currently lack.”

The plan would also not mean future city councils would be obligated to levy all 3 mills. “They’re only going to levy what they need that year,” McGinnis said.

Several other options will be brought up for consideration at future City Council work sessions to help create a sustainable infrastructure funding stream. They include adjustments to water and sewer rates, a topic that will be discussed at the May 7 meeting, McGinnis said.

Other ideas to be floated over the next subsequent months, if necessary, include the possibility of a city income tax, which officials say could generate upward of $2 million; and special assessments.

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