At the May 31, 2011 session of its meeting that had begun two weeks before, on May 16, the Ann Arbor city council voted to ratify its side of a contract with the Ann Arbor Downtown Development Authority to continue to manage the city’s public parking system. The contract would transfer 17% of the parking system’s gross revenues to the city. An amendment offered by Sabra Briere (Ward 1) to retain a veto for the city council on parking rates failed on a 2-9 vote, getting support only from Briere and Stephen Kunselman (Ward 3).
The vote on the contract was unanimous.
The DDA had ratified its side of the deal at a special meeting convened last Friday, May 27. The contract, which has now been ratified by both the city and the DDA, would give the DDA the sole authority to set parking rates. Under the old contract, the DDA proposed rate changes, which were then automatically enacted unless the city council acted to veto them. The new contract requires consultation by the DDA with the city on parking rate changes.
As part of the contract, the city council also approved an “underwriting” or “backstopping” clause to the contract, which is to run over an initial 11-year term, with one 11-year renewal option. Key features of that clause include: (1) it’s applicable only through 2016; (2) it’s triggered if combined the DDA fund balance falls below $1 million; (3) the trigger is evaluated based on the annual audit of DDA books in September or October, for the previous fiscal year; (4) if underwriting were triggered, it would take the form of reducing existing payments that the DDA makes to the city; (5) the city’s liability is limited to $1 million annually and $2 million cumulatively; and (6) any money the city is deprived of through this underwriting would be restored to the city, at whatever point the DDA’s cumulative fund balance reaches $4 million.
During the parking contract discussion, Kunselman did not offer a planned resolution that would have amended the city’s fiscal year 2012 budget by transferring the balance in the DDA’s parking fund to the city, eliminating two DDA employees, and using the proceeds of that move to fund police officer positions.
This brief was filed from the city council’s chambers on the second floor of city hall. located at 301 E. Huron. A more detailed report will follow: [link]