Council OKs Annual Contracts: SPARK, Lobbyist

The Ann Arbor city council approved two annual contracts for services at its June 17, 2013 meeting. One was a $48,000 contract with Governmental Consultant Services Inc. (GCSI) for lobbying services with the state legislature. The council also approved a $75,000 contract with Ann Arbor SPARK for business support services.

The two items appeared on the council’s consent agenda and were approved as a part of it. Items on the consent agenda are considered routine, and include contracts for less than $100,000.

The contact with the economic development agency Ann Arbor SPARK is one that has been renewed annually since the Washtenaw Development Council and Ann Arbor SPARK merged in 2006. Previously, Ann Arbor had contracted with the WDC for the business support services for which it now contracts with SPARK. On June 20, 2005, the city council authorized that one-year contract with WDC for $40,000. The resolution authorizing the $75,000 contract with SPARK again this year describes the organization’s focus as “building our innovation-focused community through continual proactive support of entrepreneurs, regional businesses, university tech transfer offices, and networking organizations.”

Ann Arbor SPARK is also the contractor hired by the city’s local development finance authority (LDFA), to operate a business accelerator for the city’s SmartZone, one of 11 such districts established in the early 2000s by the Michigan Economic Development Corp. (MEDC). The SmartZone is funded by a tax increment finance (TIF) mechanism, for a TIF district consisting of the union of the Ann Arbor and Ypsilanti Downtown Development Authority districts.

Revenue is generated only in Ann Arbor’s district, and the LDFA is a component unit of the city’s budget. In the FY 2014 budget, the LDFA is expected to receive $1,655,647 in revenue. The specific taxes on which the increment since 2002 is captured are the school operating and state education taxes, which would otherwise be sent to the state and then redistributed back to local school districts.

GCSI’s Kirk Profit, a former member of the state House of Representatives, typically makes an annual presentation to the council with an update on state-level legislative issues relevant to the city’s budget situation. Written updates to councilmembers on legislative activity are sent on a weekly or daily basis.

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]