Stories indexed with the term ‘Ann Arbor Downtown Development Authority’

On the evening of May 21, the Ann Arbor city council will start its second meeting in May. I’d like to suggest not ending Monday’s meeting on Monday.

That’s right, I’d like to “kick the can down the road.” I suppose it’s a pretty big can. But it’s a short road – only one week.

Letting that meeting continue past Monday will be a benefit to the council and Ann Arbor residents, as well as to other public bodies like the Ann Arbor District Library, Washtenaw County, Washtenaw Community College and the Ann Arbor Downtown Development Authority (DDA).

The city charter requires that by the end of that meeting, the council must approve the city budget for fiscal year 2013 – which begins on July 1, 2012. If the council does not act on the budget before the end of the meeting, then according to the city charter, the budget proposed by the city administrator on April 16, 2012 will automatically take effect. Last year, the “second meeting in May” was conducted over the course of sessions on three separate days, and did not end until May 31, 2011.

Last year’s extension of that second meeting in May – achieved  by recessing and reconvening on subsequent days – stemmed from the council’s desire to achieve clarity about issues related to the DDA. The issue centered around tax increment finance (TIF) capture, as well as the contract under which the DDA operates the city’s public parking system.

This year, one of the amendments that’s almost certain to be proposed on Monday – by Stephen Kunselman (Ward 3) – revisits the issue of the DDA’s TIF capture, and provides a recurring revenue source for the city to fund two firefighter positions this year, and perhaps more in subsequent years. Kunselman’s amendment calls for the kind of interpretation of the city’s ordinance on DDA TIF capture for which I’ve previously advocated. [See "Column: Tax Capture is a Varsity Sport"]

So this year, I’d like to suggest that city councilmembers plan now to take advantage of the parliamentary option of recessing their May 21 meeting until May 28 – so that they and the public can give thorough consideration to at least nine other budget amendments (in addition to Kunselman’s DDA/firefighter amendment) that could be brought forward on Monday.

The formal public hearing on the budget was already held and closed on May 7, 2012. It enjoyed the participation of just three Ann Arbor residents. By establishing the May 21 session as an occasion to sketch out the intent and the mechanics of proposed budget amendments, the council would better serve the public’s interest in being able to advocate for or against the various proposed amendments to the budget.

I’d also like to use the occasion of this column to lay out the content of some of the fire protection amendments, and to single out Kunselman’s amendment as one that I think especially deserves the entire council’s support.   [Full Story]

Ann Arbor Downtown Development Authority board meeting (May 2, 2012): The one action item on the board’s agenda was a resolution directing its operations committee to start applying demand-management principles to the pricing for permits in Ann Arbor’s public parking system. The resolution, which passed unanimously, notes that the goal of the pricing strategy is to attract patrons to those structures that are located farther away from the University of Michigan campus.

One of those structures farther west of the campus is the new underground parking garage on South Fifth Avenue, which is nearing completion. The garage, which the DDA is currently calling the “Library Lane” parking structure, is now expected to open by the time the art fairs begin, which this year fall on July 18–21. South Fifth Avenue between Liberty and William is expected to re-open by Memorial Day.

A characterization of that timing as “on schedule” was disputed during public commentary by Ali Ramlawi, owner of the Jerusalem Garden restaurant. Jerusalem Garden is adjacent to the construction site. Ramlawi noted that the structure was originally due to be completed by August 2011.

The future use of the top of the underground garage was the subject of public commentary from advocates who’d like to see it used as a green plaza. That suggestion was met with remarks from mayor John Hieftje, who sits on the DDA board, with a description of his expectation that three major parcels would soon be incorporated into the city’s park system – 721 N. Main, 415 W. Washington, and the MichCon property (located between the Amtrak rail station and the Huron River near the Broadway bridges). Hieftje’s point was that the additional financial burden for the maintenance of those parcels as parks might impact the city’s ability to add a downtown green plaza to the park system.

Requests for better information about the parking system and suggestions for disseminating information about the availability of open parking spaces were topics of additional public commentary.

Although it was not an action item, the board discussed a draft policy on supporting “brownfield” projects – a policy prompted by discussions at the board’s partnerships committee over the last few months. [.pdf of draft DDA brownfield policy]

The committee has been discussing a proposal by Dan Ketelaar for support of a proposed development at 618 S. Main, which received a positive recommendation from the Ann Arbor planning commission on Jan. 19, 2012. If the project moves forward, the 7-story building would include 190 units for 231 bedrooms, plus two levels of parking for 121 vehicles. Ketelaar has estimated that the tax on the increment between the current valuation of the property and the final built project would yield around $250,000 a year in TIF (tax increment finance) revenue to the DDA. If adopted as it’s currently worded in the draft, the formula in the policy would translate into up to $625,000 of support for 618 S. Main.

The board also received updates on the third-quarter financial statements for the DDA, as well as an update on the Connection William Street planning project.  [Full Story]

At its May 2, 2012 meeting, the DDA board was presented with a draft policy on supporting “brownfield” projects – a policy prompted by discussions at the board’s partnerships committee over the last few months. [.pdf of draft DDA brownfield policy] The board was not expected to act on the policy, and did not vote.

The committee has been discussing a proposal by Dan Ketelaar for support of a proposed development at 618 S. Main, which received a positive recommendation from the Ann Arbor planning commission on Jan. 19, 2012. The 7-story building would include 190 units for 231 bedrooms, plus two levels of parking for 121 vehicles. Ketelaar has estimated that the tax on the increment between the current valuation … [Full Story]

At its May 2, 2012 meeting, the board of the Ann Arbor Downtown Authority approved a resolution that authorizes its operations committee (aka bricks & money and transportation committee) to use demand management strategies to price monthly parking permits in Ann Arbor’s public parking system. The goal of adjusting monthly parking permit rates is to expand campus-area parking to structures other than those immediately adjacent to the University of Michigan campus. In broad strokes, “demand managent strategies” means pricing the most desirable parking options higher than those that are less desirable.

The move comes as the opening of the new underground parking structure on South Fifth Avenue, offering around 700 additional total spaces, is set to open by the start of the Ann … [Full Story]

Ann Arbor Downtown Development Authority board meeting (April 4, 2012): The absence of four out of 12 DDA board members had no effect on any outcomes at the meeting, because the board did not have resolutions on its agenda.

The meeting took place against the backdrop of the DDA’s budget presentation to the city council the following week – on April 9 – and various other ongoing projects. So the board’s agenda consisted of a collection of regular committee updates and status reports.

Those included an update on the Connecting William Street project – an initiative to explore alternative uses of a limited set of city-owned parcels currently used for parking. The DDA embarked on the project at the direction of the Ann Arbor city council in a resolution it approved about a year ago – on April 4, 2011. The DDA had wanted the ability to lead that exploration, partly in exchange for renegotiating a contract under which the DDA operates the city’s public parking system. That new contract was finally settled on May 31, 2011, and features a clause that provides the city of Ann Arbor 17% of gross revenues out of the public parking system.

Total parking revenues for fiscal year 2013 are projected at around $18 million in the budget approved by the DDA board at its meeting the previous month, on March 7, 2012. That budget was presented by the DDA at a city council work session on April 9. The budget presentation featured a review of the DDA’s history of infrastructure investment and impact on the downtown district since its formation in 1982 – over $100 million of DDA investment, accompanied by $300 million in private investment and an increase in taxable value from $89 million to $386 million.

Another work session highlight was a series of questions posed by councilmember Stephen Kunselman (Ward 3) about compliance with Ann Arbor’s ordinance that regulates how the tax increment finance (TIF) tax capture works for the DDA district. Last year, the city’s financial staff pointed to Chapter 7 of the city code, which appears to limit the amount of taxes the DDA can “capture” from the other taxing units in the district. The DDA board agreed with the city’s interpretation, and returned $473,000 in combined TIF revenues to the Ann Arbor District Library, Washtenaw Community College and Washtenaw County.

Subsequently, the DDA reversed its position and gave a different interpretation to Chapter 7. Responding to Kunselman at the work session, DDA board chair (and retired Washtenaw County administrator) Bob Guenzel told Kunselman that the DDA had informed other taxing units of the DDA’s revised position, which was not to say they agreed with the DDA, he said.

Also the focus of TIF monies captured by the DDA is a proposed development at 618 S. Main, which received a positive recommendation from the Ann Arbor planning commission on Jan. 19, 2012. The 7-story building would include 190 units for 231 bedrooms, plus two levels of parking for 121 vehicles. The developer of the project, Dan Ketelaar, has estimated that the tax on the increment between the current valuation of the property and the final built project would yield around $250,000 a year in TIF revenue to the DDA.

Ketelaar is was initially asking that in addition to reimbursement of certain costs (at around $1.4 million) within six months of the project’s completion, the DDA pledge 80% of its TIF capture money for six years – an additional $1.3 million – to support certain aspects of the project in connection with the state’s Community Revitalization Program. But subsequently, Ketelaar revised the request to include just the TIF reimbursement. So the total request, over six years, is $1.3 million. The CRP is the successor to the brownfield and historic preservation tax credit program. In order to approve the tax credit, the state would like to see a commensurate commitment from local units – and Ketelaar is proposing that it take the form of the DDA’s support.

Ketelaar has pitched his idea to the DDA board on several occasions now – first at the full board meeting on Feb. 1, 2012, and at three subsequent DDA partnerships committee meetings. DDA board members are cautious about the precedent that such a pledge might set, and the appropriateness of the DDA’s role at this early stage in the project. (Ketelaar has not yet acquired the land.) At the March 28 partnerships committee meeting, DDA board member Newcombe Clark expressed concern that, depending on the precise role defined for the DDA’s participation, the DDA could effectively be artificially inflating land values.

This report takes a look in more detail at Connecting William Street, the DDA’s April 9 budget presentation to the city council, the lingering TIF capture issue, and the 618 S. Main project, as well as odds and ends from the April 4 DDA board meeting. [Full Story]

Ann Arbor city council meeting (April 2, 2012) Part 2: At a long meeting that stretched until midnight, the council handled multiple items involving direction to city staff – one of which was related to enforcement of medical marijuana laws. All medical marijuana issues from the meeting are covered in Part 1 of The Chronicle’s meeting report.

Neither of the other two resolutions involving direction to staff got much support on the council. Failing on a 3-7 vote was a resolution that would have directed the city attorney to provide a written opinion on the transfer of funds from the city’s street millage fund to the public art fund. The resolution got support only from its sponsors, Stephen Kunselman (Ward 3) and Sabra Briere (Ward 1), who were joined by Mike Anglin (Ward 5). The council postponed a separate item that would have authorized $150,000 for a piece of art that the public art commission has recommended for the lobby of the new Justice Center.

Failing on a 4-6 vote was a resolution related to the Ann Arbor Downtown Development Authority. It directed city staff to “to review, analyze, and report on the compliance of the DDA provided TIF calculation and capture amount” – an issue that relates to excess capture of taxes identified last year. The three who supported the resolution requesting an opinion on public art were joined by Jane Lumm (Ward 2) in supporting the TIF resolution. Only 10 councilmembers attended the meeting – Marcia Higgins (Ward 4) was absent. But even if Higgins had voted for the two resolutions, they still would have failed.

Generating some controversy were two items involving automobiles. The council gave final approval to changes in parking regulations that include a provision allowing the developer of a downtown project to meet minimum parking requirements without building parking spaces on site. The alternative is to make a payment in lieu of building parking spaces, or to sign a long-term contract to purchase monthly parking permits in the public parking system. Anglin voted against the ordinance change as well as the specific policy governing the payments in lieu of parking.

On another automobile-related item, Anglin was joined by Lumm in opposing a resolution that made a formal request to the Michigan Dept. of Transportation to convert a segment of Jackson Road between Maple Road and South Revena from four traffic lanes to three. That request will move forward. In another road-related item, the council unanimously approved a $3,647,344 construction contract for the first set of streets to be repaired in the 2012 program. That will be followed at the council’s next meeting, on April 16, by a second contract for an additional set of streets.

The council also gave approval to three different site plans – for Arbor Hills Crossing on Washtenaw Avenue, Les Voyageurs near Argo Pond, and Noodles & Co. on West Stadium Boulevard.

Public commentary at the end of the meeting featured several speakers who called the council’s attention to April as Sexual Assault Awareness Month. [Full Story]

At its April 2, 2012 meeting, the Ann Arbor city council approved the policy by which the minimum required parking component of developments in the downtown D1 and D2 zoning districts can be satisfied off-site from the development. The city is using the acronym CIL for “contribution in lieu” to describe the option. The idea could be familiar to some readers as PILOP, or “payment in lieu of parking.” The sole vote against the resolution came from Mike Anglin (Ward 5).

If not provided on-site, the policy allows some of the minimum required parking spaces to be provided with one of two basic strategies: (1) commit to a 15-year contract with the Ann Arbor Downtown Development Authority to purchase monthly permits … [Full Story]

At its April 2, 2012 meeting, the Ann Arbor city council declined to pass a resolution that would have asked city staff to verify the compliance of the Ann Arbor Downtown Development Authority with the city’s ordinance that governs how the DDA’s tax capture works. In declining to pass the resolution, the council gave its implicit approval to the DDA’s interpretation of the ordinance, which the DDA currently claims does not, in fact, limit its tax capture.

That’s a reversal of both the DDA and the city’s position from last May, when city financial staff pointed out the implications of the city ordinance. The result was a computation of excess TIF capture of over $1 million. The city of Ann Arbor … [Full Story]

Ann Arbor Downtown Development Authority board meeting (March 7, 2012): The main business item for the board at its monthly meeting was the approval of its budget for the coming fiscal year 2013, which starts on July 1, 2012. Across all funds, the FY 2013 DDA budget shows anticipated revenues of $22,097,956 against $24,101,692 in expenditures – for an excess of expenditures over revenues of $2,003,736.

The difference will be covered from the existing fund balance. The use of fund balance, in the current year and in the coming year, was planned as part of the construction of a new underground parking structure on South Fifth Avenue, and a new contract with the city of Ann Arbor, ratified in May of 2011. The contract, under which the DDA manages the city’s public parking system, pays the city of Ann Arbor 17% of gross revenues from the parking system.

At the end of FY 2013, the DDA expects to have a total fund balance of $4.38 million, or an amount equal to about 18.2% of expenses.

In its other main business item, the board authorized a budget of $100,000 for its Connecting William Street project, which it’s undertaking at the direction of the Ann Arbor city council. The council passed a resolution on April 4, 2011 that gave the DDA direction to explore alternative uses of city-owned parcels – currently used for surface parking – in a limited area of downtown. The area is bounded by Ashley, Division, Liberty and William streets.

Parcels included in the area are: the Kline’s lot (on Ashley, north of William), Palio’s lot (at Main & William), the ground floor of the Fourth & William parking structure, the old Y lot (Fifth & William), and the top of the Fifth Avenue underground parking garage, which is nearing completion.

Of the budgeted amount, $65,000 will come from a community challenge grant awarded recently as part of a larger $3 million grant awarded to Washtenaw County by the U.S. Dept. of Housing and Urban Development. The remaining $35,000 will be made up by DDA cash (no more than $20,000) and DDA in-kind contributions of staff time.

Toward the end of Wednesday’s meeting, the board also entertained some discussion about parking meter bags. The bags placed over on-street parking meters to designate the spots as unusable, so that streets are free of parked cars for construction projects or special events. The meter bag discussion came in the context of a request on behalf of FestiFools and conveyed by mayor John Hieftje, who sits on the DDA board. The request was to waive fees ordinarily associated with the meter bag placement for the April 1 FestiFools parade in downtown Ann Arbor.

One possible approach includes the creation of a parking meter puppet. [Full Story]

At its March 7, 2012 meeting, the Ann Arbor Downtown Development Authority board unanimously approved its fiscal year 2013 budget. Across all funds, it shows anticipated expenses revenues of $22,097,956 against $24,101,692 in expenditures – for an excess of expenditures over revenues of $2,003,736. The difference will be covered from the existing fund balance.

The shortfall was planned. It’s in the context of construction of a new underground parking structure on Fifth Avenue, and a new contract with the city of Ann Arbor, ratified in May of 2011, under which the DDA manages the city’s public parking system. That contract pays the city of Ann Arbor 17% of gross revenues from the parking system, which are budgeted in FY 2103 … [Full Story]

At its March 7, 2012 meeting, the Ann Arbor Downtown Development Authority board voted to establish a budget of $100,000 for its Connecting William Street project, which it’s undertaking at the direction of the Ann Arbor city council. The council passed a resolution on April 4, 2011 that gave the DDA direction to explore alternative uses of city-owned parcels – currently used for surface parking – in a limited area of downtown. The area is bounded by Ashley, Division, Liberty and William streets.

Parcels included in the area are: the Kline’s lot, Palio’s lot, Fourth & William parking structure (ground floor), the old Y lot (Fifth & William), and the top of the Fifth Avenue underground parking garage, which … [Full Story]

How do Ann Arbor’s land use policies affect where people live and work, and the way they get from one place to another? What is the city doing to support sustainable approaches?

Issues of land use and accessibility were the topic of a sustainability forum on Feb. 9, the second in a series that’s part of a broader city sustainability initiative. During the forum, city staff also unveiled a set of draft goals for Ann Arbor related to four general sustainability themes: Resource management; land use and access; climate and energy; and community.

Wendy Rampson, head of the city’s planning staff, told the audience that the 15 draft goals were extracted from more than 200 that had been identified in existing city planning documents. The hope is to reach consensus on these sustainability goals, then present them to the city council as possible amendments to the city’s master plan.

Speakers at the Feb. 9 forum included Joe Grengs, a University of Michigan associate professor of urban and regional planning; Susan Pollay, executive director of the Ann Arbor Downtown Development Authority; Eli Cooper, the city’s transportation program manager and member of the Ann Arbor Transportation Authority board; Jeff Kahan of the city’s planning staff; Ginny Trocchio, who manages the city’s greenbelt program; and Evan Pratt of the city’s planning commission.

A Q&A followed presentations by the speakers and covered a wide range of topics, including thoughts on the proposed Fuller Road Station. The following day, Feb. 10, the city and University of Michigan announced plans to halt the initial phase of that controversial project – a large parking structure near the UM medical campus.

The topics of the series of forums reflect four general sustainability themes: Resource management; land use and access; climate and energy; and community. The first forum, held in January, focused on resource management, including water, solid waste, the urban forest and natural areas.

All forums are held at the downtown Ann Arbor District Library and are being videotaped by AADL staff. The videos will be posted on the library’s website. Additional background on the Ann Arbor sustainability initiative is on the city’s website. See also Chronicle coverage: “Building a Sustainable Ann Arbor,” and an update on the project given at the November 2011 park advisory commission meeting. [Full Story]

Ann Arbor Downtown Development Authority board meeting (Feb. 1, 2012): In the one agenda item that required formal action, the DDA board unanimously voted to award an annual management incentive to Republic Parking, the contractor that manages day-to-day operations of the city’s parking system.

The amount of the award was 90% of the total amount the board could have awarded –$45,000 of $50,000. It’s the same amount the board has awarded in each of the last three years. It’s based on a variety of criteria, including customer satisfaction surveys, independent inspections of the parking facilities, and financial performance.

February’s meeting also included a review of the DDA’s finances at the mid-point of the fiscal year – through Dec. 31, 2011. The DDA’s fiscal year runs from July 1 to June 30. Operations committee chair Roger Hewitt sketched out a picture that portrayed things unfolding pretty much as expected. Although parking revenues are currently about $125,000 under the year-to-date budgeted amount, parking revenues are projected to finish the year at around $672,536 over the budgeted amount. The gross parking revenue now anticipated for FY 2012 is around $16.8 million. But capital costs associated with the new Fifth Avenue parking garage construction are anticipated to put the parking fund expenses over budget.

Part of that parking system revenue will come from rate increases and changes in billing methods, which were approved by the board at its Jan. 4, 2012 meeting. Some of the changes will not be implemented until September 2012 – like hourly rates at parking structures and lots, which will climb from $1.10 per hour to $1.20 per hour.

But other changes were implemented starting Feb. 1, including a change in the billing method at parking structures and hourly lots – from half-hourly to hourly. The board heard criticism of the change during public commentary, from a resident who makes frequent but brief trips downtown as a patron of the downtown location of the Ann Arbor District Library. The billing change amounts to a “surcharge” on his library use of a couple hundred dollars a year, he said.

The board also heard a pitch from the developer of the 618 S. Main project, Dan Ketelaar, who is interested in financing certain elements of the project through the state’s Community Revitalization Program. That’s the successor to the state’s brownfield and historic preservation tax credit program.

The 618 S. Main project, which received a positive planning commission recommendation on Jan. 19, would be a 7-story, 153,133-square-foot apartment building with 190 units for 231 bedrooms. The idea would be for the DDA to forgo a portion of the taxes that it would ordinarily capture on the newly constructed 618 S. Main project. The DDA captures taxes from the increment in value due to new construction within its tax increment authority (TIF) district.

The board also heard a pitch from Jody Lanning, with Lanning Outdoor Advertising, for a way to finance murals on the city’s parking structures and other public buildings. The board also entertained its usual set of updates from boards and commissions. [Full Story]

At its Feb. 1, 2012 meeting, the Ann Arbor Downtown Development Authority board approved a management incentive under the terms of its contract with Republic Parking, which manages day-to-day operations of the public parking system. The board voted to award $45,000 out of the $50,000 that it can award on a discretionary basis. The other $150,000 of the $200,000 total incentive is not discretionary, and is paid to Republic monthly.

The management incentive is paid based on customer satisfaction surveys and independent inspections of the parking facilities. The free responses section of the survey included a range of sentiments, from enthusiastic praise of specific Republic Parking employees (“Staff is always very friendly” and “Teri and Cathy are the greatest!!”), complaints about employee … [Full Story]

Ann Arbor Downtown Development Authority board meeting (Jan 4, 2012): The DDA board dispatched with its January meeting in just under a half hour. The discussion by the board and the public about its main agenda item – parking rate increases – had already taken place at previous meetings.

The parking rate increases that will affect many downtown visitors will not take effect until Sept. 1. Among the increases to take effect eight months from now are an increase in on-street metered parking from $1.40/hour to $1.50/hour and an increase in the hourly rate for parking structures from $1.10/hour to $1.20/hour.

Other increases are set to take effect on Feb. 1: an increase in the premium permit parking rate by $5/month (from $175 to $180); an increase in the Ann & Ashley and Liberty Square structure evening/Saturday rates by $1/entry (from $2 to $3); a $1 increase in the 415 W. Washington lot entry (from $3 to $4) and a $5 increase in monthly permit rates (from $80 to $90/month) there; and an increase in First & William lot permits by $10/month (from $105 to $115).

A change of the effective start date – from Feb. 1 to Jan. 21 – will apply only to the meter bag rates. They’re set to increase by $5/day (from $15 to $20).

Also at Wednesday’s meeting, the board approved its 2012 calendar. Board meetings are set for the first Wednesday of the month, when they’ve typically been held, except for July 4. That meeting date was shifted to Monday, July 2.

The board also heard the usual set of reports from various subcommittees covering a range of topics, from the future of the midtown area – which includes the AATA’s Blake Transit Center and the Ann Arbor District Library building – to electric charging stations.

During his regular report from the downtown area citizens advisory council, Ray Detter remembered Ray Fullerton, a former member of that body, who passed away on Dec. 18. [Full Story]

At its Jan. 4, 2012 meeting, the board of the Ann Arbor Downtown Development Authority voted unanimously to increase parking rates – some effective starting Jan. 21 and Feb. 1, 2012, with others starting Sept. 1. Among the increases to take effect eight months from now are an increase in on-street metered parking from $1.40/hour to $1.50/hour and an increase in the hourly rate for parking structures from $1.10/hour to $1.20/hour.

The mid-January and early February rate changes are estimated to generate a total of $133,000 in additional revenue annually. Increases and anticipated revenues are: raise meter bag rates by $5/day ($68,800); increase the premium parking rate by $5/month ($3,300); increase Ann & Ashley and Liberty Square structure evening/Saturday rates by … [Full Story]

Editor’s note: Before this article was finalized for publication, it was inadvertently posted for a brief time, then removed from the website. Between versions, some added material gave more precision to the planned expenditures and use of fund balance in the city of Ann Arbor’s FY 2011 budget.

In mid-December, the audit committee of the Ann Arbor city council received what could be considered good news from the final audit for the last fiscal year. It was clean. The city also managed to add incrementally to its fund balance, instead of using more than $1 million from that balance, which it had anticipated doing.

The council’s audit committee met on Monday, Dec. 19 at 6 p.m. just before the council’s last meeting of the year, which started at 7 p.m. Last year, the committee did not meet at all, a point of complaint made by committee member Stephen Kunselman (Ward 3) at a recent council meeting.

Alan Panter of the accounting firm Abraham & Gaffney, P.C. presented the audit committee with an overview of his findings for fiscal year 2011, which were summarized in the report as “an unqualified (‘clean’) opinion on the City of Ann Arbor financial statements for the year ended June 30, 2011.”

One finding that was not deemed a “material weakness” – but was nonetheless described as a “significant” deficiency in internal controls – involved adequate documentation of employee purchase card (P-Card) use. It’s an issue familiar to the city from previous audits.

In terms of the overall financial state of the city, as reflected in the audited numbers, the city added around $127,000 to its general fund balance.

That’s significant, because the city council-approved FY 2011 budget had anticipated drawing around $1.5 million from the fund balance reserve to help cover about $81.5 million in planned general fund expenditures. So on balance, the city appears to have done at least $1.6 million better than it had planned for FY 2011. No single factor was identified during the audit committee’s discussion to account for the better performance.

At the end of FY 2011, the city’s fund balance reserves stood at around 13.6% of expenditures – which is within the range of 12-15% that Panter said was recommended.

The audit committee’s discussion included the fact that the city’s audit is required by the city charter to be completed by Sept. 30 each year – within 90 days of the end of the fiscal year. This year’s audit was not completed until Dec. 9. Based on discussion among the audit committee members and accounting services manager Karen Lancaster, missing the charter’s deadline has become routine. Lancaster indicated that the first year she’d worked for the city, in the early 1990s, that deadline had been met.

In order for the city’s overall audit to be completed, the audits from the component units have to be done first. Lancaster attributed at least part of the now-routine delay to the fact that two such units – the Ann Arbor Downtown Development Authority and the city employees’ retirement system – have their own accounting staff. That was not the case when she first began working for the city. Because the auditor first works with those separate staff to complete their individual audits, the overall process is slower than it might otherwise be, she said.

The audit committee voted to recommend acceptance of the auditor’s report.

Based on its responsibilities described in the 2006 council resolution creating the committee, next up for committee members in 2012 will be working to come up with a recommendation on the selection of an auditing firm – the contract with Abraham & Gaffney expires with this year’s audit. [Full Story]

Ann Arbor Downtown Development Authority board meeting (Dec. 7, 2011): At its last monthly meeting of the year, the DDA board continued a public hearing on proposed parking rate changes that it had begun at its November meeting. Only two people appeared for the continued hearing on Wednesday – nine people had addressed the board for its Nov. 2, 2011 meeting.

The board will not vote on the rate increases until its Jan. 4, 2012 meeting. Some of the rate changes are scheduled for implementation in February 2012, but the increases affecting most downtown Ann Arbor parkers would not be implemented until September 2012. The September changes include an increase from $1.40 to $1.50 per hour for on-street metered spaces and an increase from $1.10 to $1.20 per hour for spaces in parking structures.

Some insight into the DDA’s interest in raising parking rates can be found in the DDA’s finances, as reflected in its annual audit. Acceptance of its annual audit report was the one action item on the agenda for Wednesday’s meeting. The board voted to accept its audit report done by the firm Abraham & Gaffney, P.C. for the fiscal year ending June 30, 2011.

Auditor Alan Panter had presented the report to a subset of DDA board members at a Nov. 30 meeting of the DDA’s operations committee.

The report notes an instance of expenditures exceeding the amount of funds appropriated that is inconsistent with Michigan’s Uniform Budgeting and Accounting Act (UBAA) of 1968. At Wednesday’s meeting, DDA board members characterized it as a “technical violation.” At the operations committee meeting, the $337,478 overage was attributed by DDA staff to the submission of a bill forwarded to the DDA in June by its construction management consultant (Park Avenue Consultants Inc.) – connected to the underground parking garage and streetscape improvement projects currently under construction.

For the fiscal year 2011, the DDA showed $18,806,765 in revenues against $20,796,665 in expenses, drawing $1,989,900 from the fund balance reserve. The planned draw on fund balance is related to the underground parking garage construction payments as well as a new contract, signed this year, under which the DDA operates the city’s public parking system. That contract assigns 17% of gross parking revenues to the city of Ann Arbor. At the Nov. 30 committee meeting, DDA board member Newcombe Clark was keen to confirm the inclusion of the new contract as a note in the audit.

In his presentation to the operations committee on Nov. 30, Panter highlighted the fund balance reserve for the parking fund as a concern, saying that the fund was near deficit – it shows a fund balance reserve of less than 1% of operating expenses. A recommended fund balance level, said Panter, is 15-20%.

Another still outstanding issue for the DDA’s finances is the correct interpretation of the city’s ordinance (Chapter 7) specifying how the DDA tax increment finance (TIF) capture works. At Wednesday’s meeting, the board held its third closed session on the topic since July, to discuss the written opinion of its legal counsel on the issue. Taxing authorities that have their taxes captured under the Ann Arbor DDA TIF district have questioned the DDA’s legal position – the DDA contends that Chapter 7 does not place limits on its TIF capture. Depending on how the issue is resolved, it could mean as much as $600,000 less per year in TIF capture, compared with the budget planning the DDA is currently doing.

Also at the Dec. 7 meeting, during the opportunity for public commentary, the DDA board heard from Jim Kosteva –University of Michigan director of community relations – about a request to eliminate two on-street parking spaces on Monroe Street. With the imminent opening of the newly constructed South Hall, on the south side of Monroe, it’s anticipated that students will attempt to cross mid-block. The elimination of the parking spaces would be intended to make students who are crossing mid-block more visible to motorists. Based on the verbal exchange with Kosteva at the podium, it appears possible, but not guaranteed, that some kind of arrangement could be reached before the start of the next semester. [Full Story]

At its Dec. 7, 2011 meeting, the board of the Ann Arbor Downtown Development Authority voted to accept its annual audit for the year ending June 30, 2011.

The report from the auditing firm Abraham & Gaffney, P.C. notes an instance of expenditures exceeding the amount of funds appropriated that is inconsistent with Michigan’s Uniform Budgeting and Accounting Act (UBAA) of 1968. Auditor Alan Panter presented the report to a subset of DDA board members at a Nov. 30 meeting of the DDA’s operations committee. At that meeting, the $337,478 overage was attributed by DDA staff to the submission of a bill forwarded to the DDA in June by its construction management consultant (Park Avenue Consultants Inc.) for the underground parking garage … [Full Story]

At its Dec. 7, 2011 meeting, the Ann Arbor Downtown Development Authority board continued a public hearing begun at its Nov. 2, 2011 meeting on proposed parking rate changes, and then formally closed the hearing. A vote on the rate changes won’t come until the board’s Jan. 4, 2012 meeting.

The details of proposed parking rate increases were announced in late October, most of which would be implemented starting in September 2012. Some increases would be implemented starting in February. [.pdf of DDA proposed parking rate changes]

The public hearing on parking rate increases came at the same meeting when the board voted to accept the audit from the previous fiscal year (2011), which included some concern expressed by the auditor that the … [Full Story]

Ann Arbor Downtown Development Authority board meeting (Nov. 2, 2011): At a meeting that included no business requiring a vote, the Ann Arbor DDA board began a public hearing on possible parking rate increases for the city’s public parking system.

The hearing will continue at the board’s Dec. 7 meeting, after a Nov. 14 joint working session with the Ann Arbor city council, when the two bodies will discuss proposed increases. A vote by the DDA board on the rate increases would not come until January.

Around a half dozen people spoke at the initial opportunity for public comment on the proposed rate increases, most either downtown merchants or representatives of merchant associations. They were uniformly in support of one feature of the proposal – no extension of meter enforcement past 6 p.m. Extension of enforcement hours has been actively on the table for at least two years. Based on board discussion at Wednesday’s meeting, evening enforcement could eventually be implemented – but not for the current rate increase cycle.

Those who spoke at the initial part of the hearing were generally opposed to increasing rates, but also acknowledged the financial decisions the DDA faces. And some speakers put part of the blame for that situation on the city of Ann Arbor. Under a new contract, the city of Ann Arbor now receives 17% of gross public parking revenues, which could otherwise be put back into the parking system, reducing the pressure to raise rates. Under the contract, the DDA operates the system, and is responsible for ongoing maintenance. Rates are controlled by the DDA in consultation with the city council.

The details of proposed parking rate increases were first announced towards the end of last week, most of which would be implemented starting in September 2012. Some increases would be implemented starting in February. [.pdf of DDA proposed parking rate changes]

Highlights of the changes to be enacted in September 2012 include predominantly $.10/hour increases: hourly structure parking rates would increase from $1.10/hour to $1.20/hour; hourly parking lot rates would increase from $1.30 ($1.50 after 3 hours) to $1.40 ($1.60 after 3 hours;) hourly parking meter rates would increase from $1.40/hour to $1.50/hour; monthly parking permit rates would increase from $140/month to $145/month.

The board’s meeting included the usual range of reports, including the quarterly financial numbers and parking report, and updates on the Fifth Avenue underground parking garage construction as well as the most recent development in the Nov. 8 sidewalk millage ballot proposal.

At the city council’s Oct. 17 meeting, the council passed a resolution clarifying how the millage proceeds would be used inside the DDA’s geographic district. And at the DDA’s Wednesday meeting, mayor John Hieftje gave the clearest public indication to date that he does not want to take a position on the sidewalk millage, saying that residents would have to “figure it out for themselves.”

The board also held a closed session, under the provision of the Michigan Open Meetings Act that allows such a session to discuss the meaning of legal advice contained in a written document protected under attorney-client privilege.  [Full Story]

In a document that began circulation in the community on Oct. 27, the Ann Arbor Downtown Development Authority has detailed proposed parking rate increases, most of which would be implemented starting in September 2012.

Highlights of the proposed changes include predominantly $.10/hour increases: hourly structure parking rates would increase from $1.10/hour to $1.20/hour; hourly parking lot rates would increase from $1.30 ($1.50 after 3 hours) to $1.40 ($1.60 after 3 hours;) hourly parking meter rates would increase from $1.40/hour to $1.50/hour; monthly parking permit rates would increase from $140/month to $145/month.

No extensions of enforcement hours are a part of the proposal.

At its Nov. 2, 2011 meeting, the DDA board will formally announce its intent and open a public hearing on the … [Full Story]

Ann Arbor Downtown Development Authority board meeting (Oct. 5, 2011): At its regular monthly meeting, the DDA board had no voting items on its agenda, but received the usual set of reports from its committees and the public.

Those included the monthly parking report, which showed use of the city’s public parking trending upward compared to last year, as well as an annual report on the structure-by-structure breakdown of the parking system.

The reports presented to the DDA board at their meeting – together with a recent report delivered to the city’s environmental commission about parking trends dating back to the mid-2000s – provide reason for some cautious optimism. The number of people getting access to downtown Ann Arbor by driving there and parking suggests an overall slight upward trend, despite a reduced number of number of hourly patrons earlier this year.

Also related to parking, the board received a presentation on a communications plan that the DDA is developing, targeted at downtown evening employees. That communications plan is meant to make sure those employees are aware of low cost alternatives to using on-street parking spaces. The communications strategy would be part of a possible plan to extend enforcement hours for on-street parking meetings past 6 p.m. The DDA will present its tentative proposal for revisions to parking policies to the city council at a joint working session of the board and the council to be held on Nov. 14.

In response to some of the individual success stories that were presented in connection with parking alternatives, DDA board member Russ Collins said, “I wonder how this positive message will play in the media.”

Collins’ remark could have applied to much of the rest of the meeting as well. The board took the report on the basic current financial health of the parking system as an occasion to talk about the overall economic strength of the downtown. Despite the recent closing of some smaller stores, board members gave reports of strong performances by other businesses.

That positive report contrasted with public commentary about ongoing problems with aggressive panhandling and drug dealing and other fringe behavior exhibited downtown. Mayor John Hieftje, who sits on the DDA board, described how some response is being developed by the Ann Arbor police department.

The construction updates on the Fifth and Division streetscape improvement project and the underground parking garage on Fifth Avenue converged on the Ann Arbor District Library. The projects will result in modifying the downtown library building’s front porch, to facilitate access from the new east-west mid-block street – Library Lane – into the library.

As the underground parking garage nears expected completion in the spring of 2012, brief discussion unfolded among DDA board members on the near-term use of the top of that garage. Also related to potential development in the “midtown area” was a report from the partnerships committee. A steering committee comprising DDA board members and community members will be leading the effort to explore alternative uses of specific city-owned parcels downtown, including the top of the underground parking structure (aka the Library Lot).

It was the first board meeting chaired by Bob Guenzel, who was elected to that position at the DDA’s last meeting, which he was unable to attend. [Full Story]

As the Nov. 8, 2011 general election approaches, the Ann Arbor Downtown Development Authority is considering the implications that a ballot question might have on the DDA’s tax increment finance (TIF) district. The ballot question asks voters to approve a sidewalk repair millage that would levy a new tax of 0.125 mills. A mill is $1 for every $1,000 of a property’s taxable value.

Members of the DDA’s transportation, operations and construction committee were briefed on that and a number of other issues at its regular monthly meeting on Wednesday, Sept. 28. (The committee has a combined function for what were at different times in the past three separate committees.)

The committee was also briefed on: (1) the status of the getDowntown program; (2) a parking communications plan aimed at evening employees; (3) the financial picture for the city’s public parking system; and (4) the results of a parking customer satisfaction survey.

Committee members were somewhat surprised and disappointed to learn that the city council’s policy on the use of proceeds from the proposed sidewalk millage would place restrictions on using millage money inside the boundaries of the DDA’s TIF district.

The city council’s Aug. 4 resolution authorizing ballot language for the proposed 0.125 mill tax places a limitation on the use of funds inside the TIF district, though the wording on the ballot does not include the limitation. The resolution states that inside the DDA district, only those sidewalks adjacent to single- and two-family houses (but not other commercial properties) would be included in a millage-supported sidewalk repair program.

A resolution of intent on the use of the sidewalk millage, which includes the restriction inside the DDA TIF district, was postponed from the council’s Sept. 19 meeting, and will be taken up by the council again on Oct. 3.

At their Wednesday meeting, DDA committee members were also apprised that the getDowntown program, which draws the majority of its funding from the DDA, will not be folded into the DDA as had previously been planned. Instead, the program’s two staff members will remain employees of the Ann Arbor Transportation Authority. The getDowntown program’s status has been a question since the Ann Arbor Area Chamber of Commerce (now the Ann Arbor/Ypsilanti Regional Chamber) two years ago pulled out of the four-way partnership that supported getDowntown. The remaining three partners are the city of Ann Arbor, the DDA and the AATA.

The committee was also briefed on elements of the DDA’s communications plan that’s aimed at downtown evening employees, in connection with possibly extending parking meter enforcement hours past 6 p.m. Other parking-related issues on the committee’s agenda included a structure-by-structure breakdown of the financial performance of the city’s parking garages, as well as an overview of the results of a regular parking system survey used to evaluate Republic Parking, the DDA’s parking contractor.

This report focuses on sidewalks and getDowntown. [Full Story]

Ann Arbor Downtown Development Authority board meeting (Sept. 7, 2011): In the main business of its September meeting, the DDA board voted to renew a $500,000 grant previously awarded to Avalon Housing for its Near North affordable housing project on North Main Street. The project is planned to include 39 units of affordable housing on the site where eight now-vacant houses stand.

The Near North decision came over the objection of three board members, who expressed concern over unanswered questions about the project’s timeline. Avalon had also requested that the intent of the resolution be expressed in the form of a contractual agreement and that the period of the grant be two and a half years, instead of the maximum two years normally attached to DDA grants. The additional time is needed in order to cover a sufficient period to achieve LEED certification.

Representatives of the construction trades, who objected to the selection of the Grand Rapids-based Rockford Construction as the general contractor for the Near North project, as well as a resident spoke against the DDA’s grant award during the time allowed for public participation.

The three votes against the grant renewal came from Newcombe Clark, Roger Hewitt and Russ Collins. With the absence of board members Keith Orr and Bob Guenzel, the 12-member board still achieved the minimum seven votes it needed for approval of the grant.

Despite his absence from Wednesday’s meeting, Guenzel was voted as the new chair of the DDA board, filling a vacancy in that position left when the recently elected chair, Gary Boren, was not nominated for reappointment to the board when his term expired on July 31. Boren was on hand to accept a resolution of appreciation for his service on the board.

In connection to the officer election timing issue, Clark asked for a review of the board’s bylaws by the board’s executive committee. Clark has raised the issue during the July officer elections for the last two years. Because the mayor has been reticent about his intended appointments, DDA board members have elected their officers for the coming year without knowing if all board members with expiring terms will be reappointed. Clark asked that the bylaws possibly be changed so that board officers are elected after appointments are made, so that it’s clear who will be serving on the board.

In other business, the board unanimously passed a resolution of support for the RiverUp! program amid some discussion of the appropriateness of the resolution – in light of the fact that the Huron River does not flow through the DDA tax district.

The board also passed a resolution encouraging the Washtenaw County board of commissioners to enact an economic development tax on county residents. About half of the tax proceeds would go to Ann Arbor SPARK. The resolution came at the request of DDA board member Leah Gunn, who also serves on the Washtenaw County board. The Ann Arbor city council had previously passed a resolution encouraging the county board to enact the tax. The county board gave initial approval to the tax later that evening.

As part of the reports from various board committees, Roger Hewitt stressed that the parking rates and hours of enforcement discussed at the previous week’s operations committee meeting were merely the start of the discussion. The DDA is currently discussing what kind of proposal it will present to the city council at a November joint work session on parking. Under its new contract with the city to manage the public parking system, the DDA’s authority to set rates and hours of enforcement comes with specific requirements on public input.

The city council also has directed the DDA to explore alternate uses for some of the city-owned surface parking lots in the downtown. Board members got an update on the status of the DDA’s effort to plan how to implement that directive.  [Full Story]

At its Sept. 7, 2011 meeting, the Ann Arbor Downtown Development Authority board voted to renew a grant to Avalon Housing that the board had originally approved two years ago for the Near North affordable housing project on North Main street.

The grant is for $400,000, with another $100,000 available if the project achieves LEED certification. The grant would be paid when the project receives a certificate of occupancy, and a waiver of all liens. Avalon must also have an agreement in place with the city/county office of community development to ensure that income eligibility requirements are met for all residents.

The income eligibility requirements for the 39 units in Near North are based on affordability as defined for two categories of apartments. … [Full Story]

At its Sept. 7, 2011 meeting, the board of the Ann Arbor Downtown Development Authority passed a resolution expressing support of RiverUp!, a collaborative effort among several organizations – including the Huron River Watershed Council, the National Wildlife Federation, and the Michigan League of Conservation Voters – to improve the Huron River corridor.

The resolution states that the DDA will assist in wayfinding efforts that would help connect the river with visitors to the downtown, but it does not specify a budget for that effort. [For background on the RiverUp! initiative, see Chronicle coverage: "RiverUp! Focuses on Revitalizing Huron River"]

This brief was filed from the DDA offices at 150 S. Fifth Ave., where the board holds its meetings. A … [Full Story]

At its Sept. 7, 2011 meeting, the Ann Arbor Downtown Development Authority board passed a resolution urging the Washtenaw County board of commissioners to use Act 88 of 1913 to levy a tax to support economic development in the county. A public hearing on the tax is scheduled for the county board’s meeting tonight.

At its Aug. 15 meeting, the Ann Arbor city council passed a similar measure urging county commissioners to levy the tax.

For the last two years, the county board has levied the tax – at a rate of 0.043 mill. (One mill is $1 for every $1,000 of a property’s taxable value.) Because Act 88 predates the state’s Headlee legislation, the county board does not need to put the issue before voters … [Full Story]

At its Sept. 7, 2011 meeting, the Ann Arbor Downtown Development Authority board voted unanimously to name Bob Guenzel as board chair and Leah Gunn as vice chair.

The board had been without a chair, because board member Gary Boren, who had been elected to that post by his board colleagues at their July 6, 2011 meeting, was not nominated by mayor John Hieftje for reappointment to the board after his term expired on July 31. Boren was replaced on the board by local attorney Nader Nassif.

Guenzel, who retired last year as Washtenaw County administrator, was elected vice chair of the board at the July meeting and, according to the bylaws, would perform all the duties of the chair. Gunn’s other … [Full Story]

At its Sept. 7, 2011 meeting, the board of the Ann Arbor Downtown Development Authority will consider a resolution that names Bob Guenzel as board chair and Leah Gunn as vice chair.

The board is currently without a chair, because board member Gary Boren, who had been elected to that post by his board colleagues at their July 6, 2011 meeting, was not nominated by mayor John Hieftje for re-appointment to the board. Boren was replaced on the board by local attorney Nader Nassif.

Guenzel, who retired last year as Washtenaw County administrator, was elected vice chair of the board at the July meeting and, according to the bylaws, would perform all the duties of the chair. Gunn currently serves on the … [Full Story]