Grand Rapids considers extending income tax hike to pay for road improvements

Jan 7, 2014

Voters in Grand Rapids could get a chance to vote on an income tax extension this year. The city wants to extend a temporary income tax hike to maintain roads and sidewalks.

Grand Rapids voters approved the temporary income tax hike in 2010. It’s paid for a number of projects that will lower the overall cost of running city government. That increase will expire in 2015.

Now the city commission is considering asking voters to extend that increase for another 15 years. City manager Greg Sundstrom says it would raise roughly $9 million per year for road and sidewalk maintenance.

“I understand tax increases are never fun things to talk about but having said that, this is the last piece,” Sundstrom said.

He says if voters passed the tax extension, the City of Grand Rapids would be able to sustain itself – both in operations and managing its assets in the long term.

“Just as we should repair our roof when it begins to leak, before we begin to have problems with our drywall and other parts of the home, we need to do the same thing once and for all with our streets,” City Commissioner Ruth Kelly said. Kelly and other commissioners say poor road maintenance is always an issue their constituents bring up.

If passed, the city would be responsible for sidewalk repair and replacements, instead of the property owner.

A streets task force has been studying the issue for the last year. It's determined that the money would be enough to get 70% of city streets in “good” to “fair” condition. With no new investment, the task force says 87% of city streets will be in “poor” condition by 2019.

Deputy City Manager Eric DeLong warns that “good” to “fair” outcome depends on the state coming up with a solution to road funding. It’s something the Legislature hasn’t been able to tackle since the late 1990s.

“This is really about economic development, it’s about the quality of our neighborhoods, it’s about the quality of our business districts, and it’s about the quality of life in our state,” Deputy City Manager Eric DeLong said.

“If the state were to fail to follow through, which in all fairness I can’t imagine they can be that negligent, but if that’s the case it would just extend the time period that it takes for us to get to a state of 70% ‘good and fair,” Sundstrom said.

Voters would have a chance to weigh in on the increase in May. People who live in the city would continue to pay twice the rate of those who only work in the city.

Grand Rapids is one of about two dozen Michigan cities with an income tax.