City of Grand Rapids Transformation Investment Plan—Sustainable Asset Management February 12, 2013

The City’s path to sustainability is multi-layered. When the City began its transformation in 2010, it focused out of necessity on our basic operations, to ensure our survival and continued provision of critical services. Recently, the City focused on public safety operations to ensure that these primary services meet the expectations for community outcomes. We have made progress transforming operations and can now predict we will meet our transformation goals by June 30, 2015. Grand Rapids’ transformation journey will continue to focus on reaching a state of sustainability for operations, after which we will seek to enter a state of sustainability and continuous improvement for operations. As we anticipate 2015, we can extend our focus to sustainable long-term management of our public assets. When this longer-term focus on City assets has been addressed and reaches a state of sustainability and continuous improvement, the City can then focus on the next level in our quest for sustainability and continuous improvement. While it is exciting to witness our positive progress, we must first transform our operations before we can transform management of our long-term assets. Together, solid operations and asset management will create a platform where residents can achieve their potential and do their part to make this city great.

Transformation Investment Plan: Phase I

City of Grand Rapids

7/1/09

Temporary City Income Tax approved 5/4/10 7/1/10

February 12, 2013

Temporary City Income Tax ends Phase I complete

Today 2/12/13 7/1/11

7/1/12

7/1/13

7/1/14

7/1/15

7/1/16

7/1/17

7/1/18

7/1/19

Phase I Investments Public Safety Streets and Infrastructure Quality of Life Transparency, Accountability, and Communication Citizen Engagement and Customer Service Transforming City Operations Phase I continuous transformation and improvement ˃

Financial Tools

FY2013 (millions) EVIP $4.8 CGAP $0.6 - $3.6 Special assessments $0.2 Citizen approved Income Tax increase $9.5

Phase I—Operations Transformation Plan

Citizen Planning Partners Transformation Advisors Neighborhood and business associations Grand Rapids Public Schools Green Grand Rapids Friends of Grand Rapids Parks Design Teams

July 1, 2010

Beginning State—Preparing to Transform

July 1, 2015



$33 million General Operating Fund operating deficit





Citizens approved a temporary five-year City Income Tax increase, July 1, 2010, through June 30, 2015

Ongoing revenues will meet or exceed ongoing expenditures



Citizen approved temporary five-year City Income Tax increase is no longer needed for operations

 Fullfilled

ballot promise by hiring ten community police officers and fifteen firefighters and began to transform core City operations and services to become sustainable

Phase I Transformation



Created the Transformation Fund with the balance of the City Income Tax revenues, State revenue sharing (EVIP), and competitive grants (CGAP)

 Fullfilled

ballot promise by hiring ten community police officers and fifteen firefighters and transformed core City operations to become sustainable



Relied on the Transformation Fund to reinvest in City services with return-on-investment requirements to lower City costs within the five-year Phase I period

a citizen group—Transformation Advisors, to advise the City on transformation goals



Reduced employee total compensation by 12.3%, employee count by 17%, and departmental budgets by 10%



Created Five-Year Transformation Investment Plan focused in six service areas with 76 value streams





Created an employee group—Investment Managers, to review requests for investments from the Transformation Fund for the City Manager and City Commission

Lowered water and sewer rates and reduced the refuse millage, realigned fees, and created 3-1-1, myGRcitypoints, and the smart-cart refuse program



Improved customer service, increased citizen access to services, and created new self-service tools



Completed Five-Year Transformation Investment Plan—Phase I, which guided all departments



Developed the Transformation Plan—Phase II, which focuses on City assets, i.e., streets, parks, street lighting, stormwater, sidewalks, pools

Operations on-track to transform by 7/1/15 Police Fire Administrative Services Human Resources Community Development Public Services Design and Development Services Water Services Environmental Services Engineering Fiscal Services Facilities and Fleet Management Technology and Change Management Income Tax Assessor Executive, Clerk, Law, Treasury, Comptroller Golf course Cemeteries

Sustainable State—Phase I Outcomes

 Appointed



Trained employees to use Lean to transformation decisions to create efficiencies

guide



Developed online dashboard metrics and reporting on the City’s progress toward the Sustainable State

Transformation Investment Plan: Phase II

City of Grand Rapids

7/1/09

Temporary City Income Tax approved 5/4/10 7/1/10

Temporary City Income Tax ends Phase I complete

Today 2/12/13 7/1/11

February 12, 2013

7/1/12

7/1/13

7/1/14

7/1/15

Phase II complete 7/1/16

7/1/17

7/1/18

Phase II Transformation Sustainable Asset Management

Phase II continuous asset investment ˃

Services to transform beginning 2/12/13

Phase II—Sustainable Asset Management

Mobility Infrastructure Streets Sidewalks

Green Infrastructure Parks and Recreation Pools and Water playgrounds Urban Forestry

Public Infrastructure Street Lighting Stormwater management City buildings

7/1/19

Beginning State—Phase II

February 12, 2013



Currently meeting operational transformation targets, on pace one-half through Phase I



Citizen approved five-year City Income Tax increase is no longer needed for Phase I operations

Focused on City assets that were not planned to become sustainably managed by the end of the citizen approve five-year City Income Tax increase





Phase II services are characterized as largely public infrastructure funded without City general tax dollars that must be sustainably managed through asset management to create a complete platform



Through Mayoral and Commission leadership and broad citizen engagement, create a Phase II Transformation Investment Plan focused on sustaining City assets

City of Grand Rapids

Transformation Investment Plan: Phase II Planning

7/1/09

7/1/10

7/1/11

7/1/12

Phase II planning Phase II planning begins complete 2/12/13 12/31/13 7/1/13 7/1/14

February 12, 2013

Phase II complete 7/1/15

7/1/16

7/1/17

7/1/18

7/1/19

PHASE II—Asset Management Investments Streets Sidewalks Parks and recreation Pools and water playgrounds Urban forestry Street lighting Stormwater management City buildings

Commission and community develop Phase II plan

Phase II continuous asset improvement >

Phase II—Sustainable Asset Management

Financial Tools FY2013 (millions) EVIP $4.8 Special assessments $0 - $1.0 New property taxes (per mill) $4.0 New income taxes (per 0.1%) $4.7 CGAP Public and private partnerships Citizen Planning Partners Sustainable Streets Task Force Greater Grand Rapids Chamber of Commerce Friends of Grand Rapids Parks Urban Forestry Committee West Michigan Environmental Action Council Neighborhood and business associations

Phase II Planning Process 

Define problems



Collect data



Apply Lean principles



Define desired outcomes



Engage citizens to seek ideas and input



Prioritize, group, and leverage outcomes



Develop coordinated investment plans, with milestones and timeline



Engage citizens and seek support

 Define revenue requirements sources

 

PDCA

Sustainability Transformation Investment Plan

City of Grand Rapids

7/1/09

Temporary City Income Tax approved 5/4/10 7/1/10

7/1/11

Phase II planning Phase II planning begins complete 2/12/13 12/31/13 7/1/12 7/1/13 7/1/14

February 12, 2013 Temporary City Income Tax ends Phase I complete 7/1/15

Phase II complete 7/1/16

7/1/17

7/1/18

7/1/19

Phase I Investments Public Safety Streets and Infrastructure Quality of Life Transparency, Accountability, and Communication Citizen Engagement and Customer Service Transforming City Operations

Financial Tools EVIP CGAP Special assessments Temporary City Income Tax Public partnerships

Phase I continuous improvement ˃

Phase I—Transformation Plan

FY2013 (millions) $4.8 $0.6 - $3.6 $0.2 $9.5

Citizen Planning Partners Transformation Advisors Neighborhood and business associations Grand Rapids Public Schools Commission and community develop Phase II plan

PHASE II—Sustainable Asset Management Streets Sidewalks Parks and recreation Pools and water playgrounds Urban forestry Street lighting Stormwater management City buildings

Financial Tools EVIP Special assessments New property taxes (per mill) New income taxes (per 0.1%) CGAP Public and private partnerships

Phase II continuous asset improvement >

Phase II—Sustainable Asset Management

Illustrative Phase II Estimated Annual Sustainable Asset Management (millions) FY2013 (millions) $4.8 $0 - $1.0 $4.0 $4.7

Citizen Planning Partners Sustainable Streets Task Force Greater Grand Rapids Chamber of Commerce Friends of Grand Rapids Parks Urban Forestry Committee West Michigan Environmental Action Council Neighborhood and business associations

Phase II Investments

Proposed Sustainable Capital Operations Total

Parks and recreation $2.0 Pools & water playgrounds $0.5 Urban forestry $1.0 Streets Sidewalks Stormwater management Street lighting City buildings

Possible Current State Investment Funding

$5.5 $1.0 $1.5

$7.5 $1.5 $2.5

$5.5 $0.6 $1.5

$16.0 $1.1

$11.0 $0.5

$27.0 $1.6

$12.5 $1.2

$3.5 $1.0 $8.0

$4.0 $3.5

$7.5 $4.5 $8.0

$3.8 $3.5 $2.0

$33.1

$27.0

$60.1

$30.6

Unmet Need

$2.0 $0.9 $1.0 $6.0

$8.5 $0.4 $3.7 $1.0 $6.0

$6.0

$23.5

Phase II Planning Process 

Define problems Collect data  Apply Lean principles  Define desired outcomes  Engage citizens to seek ideas and input  Prioritize, group, and leverage outcomes  Develop coordinated investment plans, with milestones and timeline  Engage citizens and seek support  Define revenue requirements and sources  PDCA 