On my work plan for this week May 17-22 is to write up something that includes at least the getDowntown and the Ypsi-Arbor bus issues from that full DDA board meeting (actually given in very abbreviated form as a report out from the transportation committee meeting, which I attended the week before), and possibly some other miscellaneous transportation issues.

Inquiring minds want to know – since this article “focused exclusively” on the $2m transfer to the City, will there be a followup article on the other items discussed, or will we have to wait in suspense until the next DDA meeting at which they’re brought up?

The parking money belongs to the city.

In the worst economy since the 1930′s I appreciate the creative funding that keeps this city going and all without a tax increase in over a decade. Another reasons A2 is so far ahead of other Michigan cities.

I rest my case! :)

It’s important to draw the distinction between two kinds of “earmarking.” The DDA has two sources of reveue: tax increment finance (TIF) dollars and parking dollars.

The TIF money is a “baked-in” feature of what it means to be a downtown development authority. The city could not lay claim to the TIF money. The enabling legislation for downtown development authorities has language that spells out how the TIF money already collected has to revert proportionally to the entities whose taxes were captured — and that’s only in the event that there’s a determination that “excess” money has been captured.

The DDA’s parking revenue is not a “baked-in” feature of what it means to be a downtown development authority. Those revenues flow into the DDA by contract with the city. The city contracts with the DDA to manage the parking system. The DDA, in turn, contracts with Republic Parking to do actual operations for the parking system. The DDA-Republic contract for parking is basically on a cost basis — the DDA pays Republic what it costs to run the system.

So the $2 million that’s at stake here legally belongs to the DDA under its contract with the city to manage the parking system. The article documents some sentiment that the $2 million really belongs to the city (Hewitt and Gunn) and that it was a mistake for the city to have agreed to a contract that allowed the DDA to collect meter revenues (Hieftje) — that’s in addition to the parking structure revenues. Contractually, though it’s crystal clear: the money belongs to DDA under its contract with the city.

There’s two issues, then. (1) How should parking profits be invested in the city? (2) Who should decide how parking profits should be reinvested in the city?

Historically, the answer to (2) has been: the Ann Arbor DDA. And the DDA’s answer to (1) has been: It should be re-invested in the transportation system in and out of downtown, of which parking is only one component. It’s one reason why the DDA invests around $400,000 a year in parking money to subsidize bus fares for downtown employees — through the go!pass.

If the answer to (1) is the city of Ann Arbor, then the city’s answer appears to be: It should go to the general fund to address general budget gaps.

I think her contention is supported by the TIF plan that was renewed in 2003 to extend through 2033. Affordable housing is explicitly discussed in a couple different places. From that plan on the DDA website [.pdf of 2003-2033 Plan]:

Residential Development Strategies
• In order to encourage and facilitate a full range of housing options, the DDA will work with developers to encourage a residential component to developments wherever feasible; the DDA will (in accord with policies adopted by City Council) encourage developer contributions to meet moderate income housing needs, and will provide grants and loans to support housing affordable to lower income persons and families. The DDA will also support services and transportation programs to assure that the downtown remains a viable residential neighborhood.

This questions appears to remain unanswered unless it was answered at the operations committee meeting, which seems unlikely since Clark asked it again at this meeting. What wasn’t asked is whether the mutually beneficial committee actually did create the working group. Whether either question is relevant or not is questionable (at this point, certainly, but even before the vote), but they both point to the dysfunctional nature of the process followed and allowed to be followed by the group’s leaders, namely, the board chair and the mayor, the only person to whom members are presumably accountable.

Is that last statement accurate? It doesn’t appear to be technically. The DDA’s web site states that

“The mission of the Ann Arbor Downtown Development Authority (DDA) is to undertake public improvements that have the greatest impact in strengthening the downtown area and attracting new private investments.”

Affordable housing isn’t specifically mentioned.

“Lowenstein concluded that there were all kinds of things that the DDA could include in their mission of strengthening the downtown and attracting investment in the city. Bolstering the budget of the city in this kind of situation, which everyone agrees is dire, is within that mission, she concluded.”

Even setting aside terminology differences between mission versus goals or objectives, what the DDA decides as a group and what “the DDA could include in their mission” are not equivalent. The DDA has not, as far as I know, come to agreement (i.e., “decided”) that “bolstering the budget of the city in this kind of situation” (or any other kind) “is within that mission.” I wonder if Joan misspoke or if she truly believes that, and, if so, what the basis is for that belief.

I note this because it got me wondering about how each board member sees the role of the DDA relative to the city, and I might want to refer back to this later.

The resolution (hard to call it an agreement) doesn’t appear to “undertake public improvements” or even propose that they be undertaken.

I’m still pondering what all this implies about the DDA as a public entity.