City Manager Proposes $785.4 Million Budget With Lower Property Taxes

GRAND RAPIDS — Grand Rapids City Manager Mark Washington presented a $785.4 million preliminary budget proposal to the City Commission on Tuesday, marking a strategic shift from capital expansion to sustaining major community assets now coming online.

The FY2027 budget represents a 6.4% increase over the current year, primarily driven by personnel cost increases and inflation. However, Washington says the plan includes a reduction in the property tax millage rate.

Lower Millage Rate Proposed

The proposal would decrease the property tax millage rate to 8.7513, a drop of 0.1074 mills according to the city. This would be the third consecutive year the city manager has proposed reducing the millage rate, though Washington acknowledges rising property values may offset any actual tax bill reduction for residents.

"This plan reflects our commitment to responsible stewardship, high-quality service delivery and long-term resilience while ensuring we continue advancing the priorities residents care about most," Washington said. "Even in a more constrained fiscal environment, we are aligning resources thoughtfully to serve the community today and prepare for tomorrow."

Major Budget Highlights

The budget allocates significant resources across key departments and services:

• $75.4 million for Police, including $1.3 million for 10 officers added in FY2026
• $48.3 million for Fire services
• $201.6 million for Water and Wastewater, including $11.4 million for private lead service line replacement
• $48 million for Vital Streets
• $40.4 million for Parks and Community Services
• $17.8 million for Library Services
• $21.1 million for Refuse and Recycling
• Approximately $10 million to the Affordable Housing Fund from the sale of 201 Market

The General Fund is projected at $207 million, growing approximately 4.86% on the strength of property and income tax revenues. Total personnel costs across the city reach $236.5 million, up about 5% from the previous year.

Focus on Public Safety and Overtime Management

Police funding increases significantly under the proposal, with $75.4 million allocated to the Grand Rapids Police Department. The budget includes $400,000 for crime prevention efforts.

Washington addressed concerns about public safety overtime costs, noting the city has been spending beyond budget in recent years. In 2025, overtime cost the police and fire departments $11.6 million combined, rising to $13.1 million in 2026.

"We are looking to spend $8.3 million on police and fire overtime in 2027," Washington said. "The problem is that it does not meet the actual amount over the past couple of years. Before we increase it even more for overtime, I want to try to have those departments better manage their overtime and staffing issues."

The city is conducting a public safety overtime study and exploring whether additional support from other agencies or alternative funding sources could help manage these costs.

Sustaining New Infrastructure

The budget marks a transition period from rapid capital development to maintaining what has been built. Major projects completed in FY2026 include:

• The 12,000-seat Acrisure Amphitheater, opening in May
• The Martin Luther King Jr. Community Center
• The new Kendall Street Fire Station
• The relocated Public Works Facility

Continued development is expected on the Amway Soccer Stadium, Grand River restoration projects, housing development across all three city wards, and parks and trail connectivity initiatives.

Transportation and Parking

On transportation, the city negotiated an updated Downtown Area Shuttle agreement with The Rapid that avoids an approximately $1.6 million annual cost increase and reduces future capital needs by $7 million over five years.

On-street hourly parking rates will not change, and the maximum special event rate remains $25. Monthly parking rates for city-owned lots and ramps will increase in line with the cost of living.

Economic Uncertainty Factors

The plan anticipates ongoing economic challenges, including:

• Unpredictable state revenue sharing
• Shifting federal funding priorities
• The phase-out of pandemic-era ARPA resources that had supplemented city spending

The budget also includes $8.2 million in federal Community Development funding, with nearly $7 million supporting homelessness and housing stability programs.

Public Participation Schedule

Residents can participate in the budget process through several public events in May:

• May 5 — Budget Workshop, 9 a.m.
• May 12 — Budget Workshop, 10 a.m. (Committee of the Whole)
• May 12 — Budget Public Hearing, 7 p.m.
• May 19 — Commission Adoption of FY2027 Final Budget, 10 a.m. (Committee of the Whole) and 2 p.m. (City Commission)

All meetings will be livestreamed on the city's Facebook page and YouTube channel, with a Spanish-language livestream also available. Written comments can be submitted to cityclerk@grcity.us.

The new fiscal year begins July 1.

Washington credited collaboration across city departments, elected officials and the broader community for the city's continued forward momentum.

"Grand Rapids continues to move forward because of strong partnerships and community engagement," he said. "Our workforce remains committed to delivering excellent service despite increasing demands and expectations."