At a special board meeting of the Ann Arbor Downtown Development Authority, held at noon on May 27, 2011, the DDA board voted to give final ratification to a contract under which the DDA would continue to manage the city’s public parking system. The vote was unanimous among the 10 board members who attended. Absent were Gary Boren and Newcombe Clark.
At a special meeting held last week on May 20, the DDA board had initially ratified the contract, with a contingency that the city of Ann Arbor would provide an amendment that adequately underwrites DDA fund balances. Then at a Wednesday, May 25 meeting of two “mutually beneficial” committees – one from the city council and one from the DDA board – the committees hashed out that language. The contract would transfer 17% of gross parking revenues to the city.
Key elements of the underwriting clause include: (1) it’s applicable only through 2016; (2) it’s triggered if combined DDA fund balances fall below $1 million; (3) the trigger is evaluated based on the annual audit of DDA books in September or October of 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.
At the May 25 meeting, the committees also agreed on how the DDA board and city council will handle a contractually required consultation between the two groups, in conjunction with parking rate changes. And at its May 27 meeting, the DDA board approved that clause stipulating the consultation by the DDA will now be a required agenda item at annual joint working sessions between the DDA board and the city council. Currently, the DDA proposes rate changes, which are automatically enacted, unless the city council vetoes them. The new contract stipulates that the DDA would have sole authority to set rates.
The city council may now ratify the parking contract on Monday, May 31, which would help settle part of the city’s revenue issues in its fiscal year 2012 budget, and allow the council to finalize its budget on that day. [For additional background, see Chronicle coverage: "Ann Arbor Council Defers Action Again"] Councilmembers Sabra Briere (Ward 1) and Stephen Kunselman (Ward 3) also attended the May 27 meeting.