City of Kentwood continues to manage the bumps in the road of finances

Kentwood City officials presented its 2016 – 2017 budget to residents showing the city to be on solid financial ground.

By: Joanne Bailey-Boorsma


All budgets – whether personal or business – have challenges. The City of Kentwood’s budget is no different, however; through good planning, Kentwood officials have been able to weather many challenges leaving the city on solid financial ground.


City officials presented the City of Kentwood’s 2016 – 2017 budget last month during a special presentation to residents with WKTV scheduled to rebroadcast that presentation on the WKTV Government Comcast 26 and AT&T U-verse WKTV Government 99 at 7 p.m. Wednesday and Friday, June 8 and 10, and noon Sunday, June 11.


Or to see the entire program, click here.


Kentwood Finance Director Tom Chase said the city has a strong track record for being financially well run with city officials being good stewards of the city’s money. By planning ahead, officials have been able to keep good on promises to its citizens while balancing the always changing financial environment.


“We have safe infrastructure, clean water and the highest rated quality-rated roads in West Michigan,” said Mayor Stephen Kepley. Add to that a AA bond rating and 96-percent funded pension plan, all of which demonstrate how well city officials have been able to navigate the challenges that over the years have impacted the city’s funding sources such as property taxes.


The city’s fiscal year starts July 1. City staff and the commission work on the budget over several months with the City Commission approving it in the spring.


The city projects to break about even with revenues coming in around $30,813,100 and expenses slightly lower at $30,786,800.


Most of the revenue generated for the city comes through taxes. The city of Kentwood levies a 9.6066 mills with two-thirds of it going towards police and fire. Since the city is mostly service oriented, most of its expenses is in personal, Kepley noted. In fact 72 percent of the city’s budget, a little more than $22 million, is on personal.


What staff has worked toward, according to Kepley, is to make sure that the millages levied cover the city’s expenses. When determining a millage, officials try to project out enough to cover expenses for several years, Kepley said. Eventually expenses will exceed what is raised by a millage, he said.


The good news for Kentwood residents is that city officials have done a good job in keeping expenses low by managing health care expenses and the city’s pension funds and through strategic staffing. In return, staff has been able to move back when the lines between millage revenue and expenses will cross.


Kentwood’s Depty Finance Director Lorna Neniarini said part of this is because the city takes a “five-by-five” approach when preparing a budget. This is a process where officials try to look into the future to see where there might be trouble and how best to help the city save.


“When we are looking at savings, we are not looking at savings in one year, but really looking at what is the savings in five years,” Kepley said. “So if you are able to save $50,000 a year that is good, but in five years that is $250,000. If we are able to save $100,000 in a given year, in five years, that is half a million.


“So we are looking at five years ahead, so that when we save money that pushes the crossing of the lines farther away. That is all we can do. That is all any municipality can do.”


Chase added that “…picture yourself driving your car. The idea is not to look at your hood ornament as you are almost certain to get into an accident, What we are trying to do is we are trying to raise our vision up so that we are looking further down the road, making sure to take in consideration what is coming at us.”