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.