Funding priorities for the City of Grand Rapids: Business Districts are a priority, Affordable Housing not so much

For years now, there has been a growing demand from the public to get the City of Grand Rapids to do more around the issue of housing, particularly affordable housing.

This push from the public has happened in part because of the push back against the gentrification of numerous neighborhoods throughout Grand Rapids. However, the demands around housing have also come as a result of the increased number of those who are unhoused, and how the City of Grand Rapids has in many ways criminalized those who are unhoused. Lastly, the so-called housing market in this city has seen the cost of housing, whether it is the cost of buying a home or the cost of rent, increase at such a pace that is staggering.

Therefore, push back on all three fronts – resistance to gentrification, how the unhoused are treated, and the increase in housing/rental costs – has pushed the City of Grand Rapids to craft some newer policies around housing, along with a new Affordable Housing Fund that was created in the Fall of 2021. 

The Affordable Housing Fund has set aside $5 Million to fund affordable housing and homelessness prevention projects in the city, according to an MLive story that was posted earlier this year. The city’s relatively new Affordable Housing Fund Board is seeking applications from organizations that could use a share of $5 million in federal stimulus dollars to complete that work.

One could certainly say that for the City of Grand Rapids to tackle the issue of Affordable Housing, setting aside $5 Million, is a victory for those who have been pushing for these demands over the past decade. However, in the big scheme of things, $5 Million dollars isn’t a great deal of money, especially considering the size of the annual City Budget, which for the 2023 fiscal year was $597,859,508. This means that with a City budget just shy of $600 Million, setting aside $5 Million for Affordable Housing seems rather small.

In looking at a comparison to the $5 Million for the Affordable Housing Fund and put that next to budget allocations for business development, the amount for the Affordable Housing Fund is almost an embarrassment. 

During the May 9th Grand Rapids Committee of the Whole meeting, there were numerous 2024 budget items that were excepted without question, all of which centered around business development or business districts. Here is the breakdown for these 2024 budget items, which you can read in detail at this link. Number 7 on the Agenda for the May 9th Committee of the Whole meeting says:

Overview of FY2024 budgets for boards and authorities administered by the Economic Development Department and Downtown Grand Rapids, Inc. with appropriation requests totaling $45,375,682. 

Here is the breakdown of that $45,375,682: 

• City of Grand Rapids Brownfield Redevelopment Authority – $22,829,602 
• City of Grand Rapids Downtown Development Authority – $15,382,500 
• City of Grand Rapids Economic Development Corporation – $120,201 
• City of Grand Rapids Michigan Street Corridor Improvement Authority – $505,000 
• City of Grand Rapids Monroe North Tax Increment Finance Authority – $875,124 
• City of Grand Rapids North Quarter Corridor Improvement Authority – $155,000 
• City of Grand Rapids SmartZone Local Development Finance Authority – $2,746,522 City of Grand Rapids South Division- Grandville Corridor Improvement Authority – $384,000 
• City of Grand Rapids Southtown Corridor Improvement Authority – $750,432 
• City of Grand Rapids Uptown Business Improvement District – $122,840 
• City of Grand Rapids Uptown Corridor Improvement Authority – $534,461 
• City of Grand Rapids West Side Corridor Improvement Authority – $970,000 

This is a great deal of money that is fundamentally going to subsidize economic development, business districts, etc. So, why is the City of Grand Rapids willing to provide $45 Million and change for business districts, yet only $5 Million for Affordable Housing? 

Another way of framing the issue could be, it is the responsibility of local government to give priority to individuals and families that are subjected to poverty as opposed to those involved in Capitalist enterprises? I always thought that Capitalists believed in competition and that the free market should not be regulated by the government. Why do taxpayers have to foot the bill, by paying out more than $45 Million for business districts and other economic development project in the City? And we don’t we get to vote on these matters? 

My conclusion is that the the City of Grand Rapids is only recently involved in the business of Affordable Housing – primarily because of public pressure – whereas, the City doesn’t think twice on being about the business of business development. As it is with most budgetary matters in government, it is not a question of there not being enough money to fund projects, it is always about priorities, and right now the City of Grand Rapids prioritizes funding business districts and tourism for downtown Grand Rapids over Affordable Housing.