HOLLAND — Holland’s proposed Fiscal Year 2021 budget includes funds for the creation of a new job at city hall that would oversee economic development and sustainability for the city.


The person filling the job would be a second assistant city manager — the city currently has one, Matt VanDyken — who would act as the city’s point of contact for Lakeshore Advantage and would oversee the city’s financial incentives for business and development, such as tax abatements.


The job would also “support the top priorities of city council that directly relate to sustainability, including diversity, inclusion, and equity; affordable housing; and educational components of the Community Energy Plan,” according to the proposed budget.


Diversity was the Holland City Council’s top priority for the year. Work on the Community Energy Plan, which contains Holland’s goals and strategies for reduced greenhouse gas emissions, was also high on the council’s priority list.


Part of the impetus for the new position comes from the retirement of finance director Tim Vagle, who had helped the city manage the financial ins and outs of tax abatements, tax increment financing and various kinds of redevelopment zones. Vagle intends to retire by the end of the year.


The city will be looking for a new finance director, but it wants an additional high-level staff member to be able to take on that workload of managing economic development programs.


Including sustainability in the role gives the city a way to demonstrate its commitment to sustainability, City Manager Keith Van Beek said. City investments in sustainability will be budgeted under the new department of economic development and sustainability, making it easier to see at-a-glance what the city is doing to be more green.


For the upcoming fiscal year, which begins July 1, some of those investments include $16,000 to purchase hybrid vehicles for some city departments — the $16,000 reflects the additional cost above what it would cost to purchase non-hybrid vehicles — $50,000 for trees and $50,000 for community education.


“In coming years, we’d continue to capture the ways the city is making investments in sustainability in that (economic development and sustainability) budget,” Van Beek said.


Under the Holland Energy Fund, which has its own, separate budget, the city is planning to spend $160,000 on the Community Energy Plan next fiscal year, $100,000 of which is budgeted for a consultant to help with developing the next five-year strategies and goals.


Budget overview


Holland’s tax base is growing, with taxable values up 5.6 percent after adjustments, Vagle said.


The city proposes levying the same millage rate — 13.8692 mills — as last year, although it is structuring the millage differently this year to increase the portion of millage going to the general, sidewalks and the capital improvements funds with a corresponding decrease in the millage for debt service.


The city is budgeting for a 6.7 percent increase in general fund revenues and a 6.7 percent increase in general fund expenditures, at $25.4 million.


General city operations are budgeted at $57.3 million in income and $64.7 million in expenditures. The Holland Board of Public Works utilities account for $133.7 million in revenue and $115.8 million in expenditures in the proposed budget.


HBPW is not budgeting for any increases to electric or water utility rates. Water utility rates, in part due to the addition of nearly 4,000 new customers in Park Township, will decrease for 1-inch meter customers.


Wastewater rates will be increased to cover the increasing costs of biosolids disposal. The multi-million dollar anaerobic digester project is expected to help alleviate the wastewater utility’s biosolids disposal problem.


COVID-19’s impact on city finances


The 2020-21 budget was compiled before the coronavirus began to change every part of life in Holland, Van Beek explained.


Rather than try to predict how the pandemic and its economic ripple effects will change the city’s income and spending, Van Beek said city staff chose to stick to its original budget and make budget amendments throughout the next fiscal year as the effects become clear.


Budget amendments require the approval of the city council.


Expected impacts, according to Vagle, include decreased state revenue sharing payments. The city receives a slice of the state’s sales tax revenue several times a year, but sales tax revenues are expected to be down, with business closures and economic difficulties reducing consumer spending.


Act 51 road funding, generated from fuel sales and shared with local governments, is also expected to be lower this year.


The city hasn’t had major COVID-19 related expenses yet — Van Beek reported about $11,000 in city expenses tied to COVID-19 so far, mostly training, some overtime pay and additional equipment — but the future needs are uncertain.


The budgets of Holland Civic Center Place and Windmill Island Gardens will be hit by the gathering restrictions and stay-at-home orders, but the extent of the financial impact is unknown as the city doesn’t know when the Civic Center will be able to resume holding events.


"(The Civic Center) had just begun to hit their stride,“ VanDyken said.


The proposed budget is available on the city’s website. The city council will hold a public hearing and vote on the budget at 6:30 p.m. Wednesday, May 13.


— Contact reporter Carolyn Muyskens at cmuyskens@hollandsentinel.com and follow her on Twitter at @cjmuyskens.