Fix The Roads in Lowell: Do We Cut Services or Raise Funds?

Lowell has roads that need work. It is a fact; 63% of our local streets are in poor condition. Another fact is that the City, like most other municipalities in Michigan, has no funds to fix the roads. We have two options – cut back on services and put the cost savings into the streets or raise funds.

There is going to be a proposal on the November ballot asking Lowell voters to approve a City income tax with the monies collected to be dedicated to improving our roads. The tax will be 1% for residents and ½% for non-residents and it will be packaged with a 5 mill reduction for property owners in Lowell.

Before we dive into the income tax, I want to address two popular methods suggested by folks to lower expenditures. The first one is to eliminate our police department which represents about $860,000.00 of our three million dollar annual budget. It is the single biggest expenditure. 

The wisdom on the street is that if we eliminate the LPD, then our policing needs will be made up by the Kent County Sheriff’s Department. While this may be true, this would not happen for free. Deputies need to be paid and their vehicles need fuel and servicing not to mention that they might want to maintain some type of office out here. One cannot really expect KCSD to do all of that for nothing.

The City Council consulted with Lou Bender, an expert in municipal funding and a man who is intimately familiar with the type of problem facing Lowell and almost every other city or town in Michigan when it comes to road repairs and the money to do so. Lou tells us that we could expect the cost of KCSD to be in the neighborhood of $600,000 a year. So not only would we lose the quick response time of a local police force, but the savings would be less than $300,000. As a business owner and resident, I would not like to lose our police department.

Another idea folks have is to sell off Lowell Light & Power. No doubt Consumers Energy would buy LLP in an instant. We could probably repair two or three miles of our roads with the profit from the sale. The downside of selling LLP is a combination of punches I don’t believe any Lowell resident would want to experience. First, all of our electric rates would increase by 33%. Steve Donkersloot, the General Manager at LLP, constantly monitors electric pricing from Consumers. He assures me LLP customers pay 25% to 35% less than Consumers. Steve is a top notch number cruncher and he showed me the spread sheet he tracks pricing with every month.

Secondly, did you pay attention to the amount of time Consumers customers were without power during the recent ice and snow mayhem that visited Michigan? As a former Consumers power customer, I can’t tell you how many times Julie and I lost power when we lived on 52^nd Street. We stayed with our kids a time or two, a friend once, and checked into the Main Street Inn for two days one time. In the 16 years we have had our store in Lowell, there was only one power outage I can remember that lasted for several hours and caused us to close the store for the remainder of the day.

If those two reasons were not enough, LLP is a real asset to the City of Lowell and puts about $350,000 a year into the General Fund.

Selling LLP might be a short term fix for some of our roads, but in the long haul it would mean an immediate rate increase of 33%, lots more loss of power during lousy weather, and a $350,000 reduction to the General Fund of the City. Pretty lousy trade off if you ask me.

Next time we will examine the impact of a City Income Tax.

EDIT: Here is a very good, fairly short explanation about the trouble with Michigan's infrastructure: Fixing Things Costs Money