County budget balanced with boost from rising property values

Property value is returning to pre-housing crisis levels in Kent County, which allowed the Kent County Board of Commissioners to balance the 2016 budget and maintain the county’s current level of service.

The budget of $382.6 million passed last month with the help of revenues of just under $380 million. The $2.6 million difference was covered by the county’s surplus fund. The 2016 budget represents an increase of 0.4 percent from 2015.

The commission has balanced its budget in recent years, but now it will be able to do so without the risk of cutting programs.

“We have had a balanced budget for the past five years,” says Kent County Administrator Daryl Delabbio. He says this year’s surplus was “modest,” which he says was expected.

Since the 2008 recession, the economy has been undergoing slow growth. But in 2016, Delabbio says, property value is starting to perk up.

“In 2008, 2009 when the housing market went down, we saw a decrease in value,” he says. “In 2015 or 2016 the housing market will be at what it was in 2007 in terms of its taxable value.”

The total taxable value of property in Kent County is currently just over $21 billion, which Delabbio says should continue to grow.

“It’s good news, except when you look at historical trends we should probably be at 26 or 27 billion,” he says.

Since 1994, the taxable value of property in Michigan cannot increase more than either five percent or the rate of inflation, whichever is less. While value of property has increased about 6.5 percent, the taxable value of properties is half of that, or about 3.2 percent.

In Kent County, the taxable value is expected to rise 2.2 percent, Delabbio says.

The other factor that affects taxpayers is the county millage. The county’s operating level is currently at about 4.28 mills, which Delabbio says hasn’t changed since 2004. The levy will remain the same in 2016.

The increased taxable value covers “the cost of doing business,” Delabbio says, which includes a plethora of state-mandated services such as the health department, sheriff road patrol, the county courts and correctional facilities. The county also funds discretionary services, such as the county park system and contributions to the John Ball Zoological Gardens.

“If the county continues to provide for the health and safety of its citizens, and continues to have a vibrant park system and other amenities,” Delabbio says. “That adds to the quality of life in our county and should be considered part of the equation when new business, industries and residents consider moving to the county.”

The increase in property tax value will not be used to increase the county’s workforce, but to handle current costs. Health care costs are expected to rise 11 to 15 percent every year over the next few years, which Delabbio says is an ongoing challenge he hopes the county will be able to meet with its available revenue.

“While this task is daunting, the staff and I will continue to explore acceptable ways to mitigate these projected increases,” he says.

To view the county's proposed 2016 budget in full, click this link. Visit the Access Kent Board of Commissioners page for more information.