Grand Rapids expects revenue loss due to COVID-19

GRAND RAPIDS, Mich. (WOOD) — Calls for emergency services in Grand Rapids are down, but so are tax revenues.

Those are two pieces of information to come out of a virtual city commission informational meeting Tuesday afternoon.

“We’ve had excellent partnership with the Kent County Health Department. They are the lead agency,” Washington told commissioners, who appeared in video boxes on virtual meeting website.

In Kent County, 699 people had been tested for COVID-19 as of Tuesday evening, with 194 testing presumptive positive, 339 testing negative and 166 still awaiting results. Seven people in the county had died of the virus.

“We have gotten questions about the impact among our community in terms of how many people live in the city, based on county data; whether race, ethnicity, demographics, is it impacting one group more than another?” said Washington, who said the Kent County Health Department is working on gathering that information.

Washington also talked about efforts, both public and private, to help residents and businesses impacted by the stay-at-home order. The city is working with shelters and other advocates to stop the spread of coronavirus among the homeless.

Also on the agenda: the challenges facing the city when things start to get back to normal. One of those is the budget. Pre-COVID-19 projections had general fund revenues growing by 4% in the 2020-21 budget, but that won’t happen now.

“The income tax loss, the fact that all of the subsidies that are being provided for unemployment are not necessarily taxable locally, we’re going to lose that revenue,” Washington said. “But that’s why it’s important for us to restart the economy, because even though the city may not get it, people still have some disposable income to recirculate in the economy. But right now, it’s not being recirculated.”

Just how seriously the drop in revenue will affect the city’s bottom line remains to be seen.

“We have various numbers,” Washington told commissioners. “I don’t want to alarm the public at this point. But it will take another week or so and when we submit the budget proposal. That will be our best estimate for impact for this year and next year. But it will be a loss of revenue.”

The talk wasn’t just on the financial needs to rebuild. The term ‘community reactivation’ was used to describe what needs to happen to help residents come together and celebrate the eventual end to the pandemic.