GR city manager to cut 125 from payroll

GRAND RAPIDS, Mich. (WOOD) - Grand Rapids City Manager Greg Sundstrom is set to issue layoff notices to 125 employees by Jan. 1.

The layoffs and reorganization plan is the latest in what has been one of most dire budget cycles in the city's history.

The cuts

Out of the 125 layoffs, 41 will come from the police department, 28 from the fire department and 48 will be members of the Grand Rapids Employees Independent Union, the largest city union.

However, Sundstrom said nine officers of the ones laid off will be brought back Jan. 1. The returning officers will be determined by seniority.

Nonunion and administrative staff also will be cut.

"This is surely the most difficult thing, and probably (one of) the saddest days of my life," Sundstrom told 24 Hour News 8. "These are good people. They are good employees and they're not leaving through any fault of their own. It's just (that) we need to become leaner. We need to lower our costs. And we need to move forward."

The job cuts will reduce the city's workforce by 23 percent from 2002 levels.

Despite cuts to the police departments, community policing will remain a top priority, according to a series of memos prepared for city commissioners.

It will be up to police administrators to figure out how to do that with fewer officers.

In the fire department, no firehouses will close, but two fire companies will disband. That plan could involve combining two engine and ladder companies. The department also is considering limiting responses to nonlife-threatening medical calls.

"The detailed questions on the impact of services will really be answered in the months ahead," Sundstrom said.

The layoffs are expected to save the city $3.4 million during the current fiscal year and $7.7 million in the 2010-11 fiscal year.

Consolidations are part of the plan

The number of city departments will drop from 24 to 15. Several city hall executives will take over new responsibilities, replacing some lower-level managers at City Hall through attrition.

Many employees still on the payroll after Jan. 1 will be crossed trained for other city jobs.

"We must consolidate departments to gain synergies, permit larger teams of employees to work on seasonal priorities and share efficiencies between similar operations," said Sundstrom in a statement prepared for Tuesday morning's City Commission Committee of the Whole meeting, where he was expected to outline his plan.

Proposed costs to residents

Along with layoffs, city commissioners will be asked to approve a measure that would reduce personal and dependent tax exemptions from $750 to $600 per person.

The change would cost a resident family of four just less than $8 a year, and a nonresident family of four just less than $4 per year. Grand Rapids would collect a little more than $400,000 each year in new revenue.

Residents also may have to pay for streets lights. City officials are considering taking the service out of the general-fund budget and assessing residents based on the frontage of their property.

Most people would pay between $25 and $48 dollars per year to light the street in front of their houses.

Residents also will be asked to do more.

Sundstrom compares Grand Rapids to Apple's iPhone. The company developed the basic phone. But users made it work by creating various applications.

Sundstrom sees the city in the same light: providing limited, base services, from community policing to parks and recreation. But it will be up to citizens to design and pay for the use of those services.

"What we really need is for citizens, businesses (and) organizations to work with the city to provide services that we can no longer provide by ourselves," Sundstrom said.

The cause

The dramatic cuts are brought on by a financial situation that continues to deteriorate.

Income tax receipts are expected to be down $1.1 million this year, and another $2.5 million in the next budget year. State revenue sharing is expected to drop $3.8 million this year and another $2.3 million in the 2010-11 budget cycle.

Property tax levels, already hit hard by troubles in the housing market, are expected to decline further in the next two years.

A deficit pegged at $3 million for the remainder of this fiscal year has grown to an expected $9.2 million this fiscal year. A $21 million deficit expected in 2011 could grow to $27 million.

Residents may have to pay more in income tax and for lighting the street in front of their homes.

Mayor George Heartwell told 24 Hour News 8 there may be need for a tax hike, but that would need voter approval.

The mayor did not say when the vote would happen, or how much the city should ask.

Community budget meetings

City officials want to hear your thoughts on how remaining tax dollars should be spent. Nine community budget meetings have been scheduled.

• The first session for community leaders is by invitation-only on Nov. 13
• First Ward residents will meet Nov. 19 at Cezar Chavez Elementary School and Nov. 23 at Union