DDA Ponies Up for Main Street Light Poles

Political wrangling over who should pay for downtown Ann Arbor Main Street light poles has ended with a resolution passed by the Ann Arbor Downtown Development Authority board to allocate the remaining $280,000 for the project. The DDA board had previously allocated $300,000 for the $580,000 project to replace 81 light poles on downtown Main Street.

DDA board action on the $280,000 was taken at its Dec. 4, 2013 meeting, and came after the Ann Arbor city council had declined to approve an additional $280,000 budget allocation.

According to the DDA’s resolution, staff will use the DDA funding to begin now with replacement of those poles most in need of replacement, with the remainder replaced in the summer of 2014.

The DDA board action was somewhat expected based on a mid-November email sent by city administrator Steve Powers to Ann Arbor city councilmembers, indicating that no further city council action would be required to get all 81 light poles replaced. Powers’ email indicated that on Oct. 31 and Nov. 1, city staff had inspected the Main Street light poles – and based on assessment of the city’s signs and signals staff, it was determined that 36 poles should be replaced within six months or sooner and that the remaining 45 light poles should be replaced within 1 to 2 years. It was the DDA that was developing a plan for the 45 remaining light poles, Powers wrote.

The issue has a history that’s interwoven with the oftentimes fractious relationship between the Ann Arbor city council and the DDA.

By way of additional background, in April 2013 when the council gave initial approval of the change to the city ordinance that regulates the DDA’s TIF (tax increment finance) capture, one argument against that move was that it would leave the DDA without sufficient revenue to pay for the roughly $580,000 cost of replacing the decorative light poles, which are described by some as an iconic feature of Main Street.

Replacement was characterized as an urgent public safety issue, because the bases of some of the poles are rusting. Various statements were made about the number of light poles that had failed, but responding to an emailed query from The Chronicle earlier this year, city of Ann Arbor staff indicated that in early 2012 two of the light poles fell – due to a structural failure at the base of the poles caused by rust. After inspection of all the poles, two additional light poles were deemed to be in immediate risk of falling and were also replaced. As part of the council’s FY 2014 budget deliberations, the council altered the DDA’s budget and directed the DDA to allocate $300,000 toward the replacement of the Main Street light poles.

The council’s specific action on May 20, 2013 was to alter the DDA’s budget by recognizing additional TIF revenues of more than $568,000, and shifting $300,000 of that revenue from the DDA’s TIF fund to the DDA’s housing fund. The council’s budget resolution also recommended that the DDA spend $300,000 of its TIF fund on the Main Street light pole replacement. Earlier this year, in response to an emailed query from The Chronicle, city administrator Steve Powers indicated that the city council was expected to be asked to act on the matter either at its July 15 or Aug. 8 meeting. But the issue was not placed before the council until Oct. 21.

In timeline overview form:

• April 1, 2013: Initial approval of DDA TIF capture ordinance revision (Chapter 7). Main Street light poles were cited as a project the DDA might not be able to pay for if the Chapter 7 revisions were approved.
• April 15, 2013: City council approves an amendment to the Chapter 7 revision, put forward by Sally Petersen (Ward 3), which delayed application of the revised language until FY 2015.
• May 20, 2013: City council approves FY 2014 budget amendment that affects DDA budget:
  

  Whereas, The DDA is forecasted to receive $568,343 more in TIF revenues than anticipated in the proposed FY14 budget;
  Whereas, Council desires to support the public housing program in the DDA area;
  RESOLVED, The DDA TIF fund revenue and expenditure budgets be increased by $568,343 for the purposes of creating a one-time transfer;
  RESOLVED, The DDA Housing fund revenue and expenditure budgets be increased by $300,000 to reflect Council’s desire for the DDA to support affordable housing in the DDA area; and
  RESOLVED, Ann Arbor City Council requests that the DDA allocate at least $300,000 for the replacement of the light poles on Main Street.

• June 5, 2013: DDA board meets and executive director Susan Pollay reports the council’s action. She tells the board that she’s meeting with city staff to figure out how the light poles will be paid for.
• July 3, 2013: DDA board allocates $300,000 for the light pole replacement project at the same meeting it allocates $250,000 for other capital projects, and $59,200 to support the creation of a business improvement zone in the South University area. One “whereas” clause characterized the council’s action in a way that is not based on the wording of the city council’s May 20 budget amendment:
  

  Whereas, Through the 2013/14 budget approval process it was determined that the City would undertake this street light replacement in calendar year 2013, with the DDA allocating $300,000 toward the cost of the project, and the City allocating $216,000; [.pdf of complete DDA light pole resolution]

• Oct. 21, 2013: Ann Arbor city council rejects a supplemental budget allocation of $280,000 toward the downtown light pole replacement project on a 7-4 vote. It needed eight votes to pass.
• Dec. 4, 2013: DDA board approves $280,000 allocation from the remainder of its 2002 State Street Improvements Project and with funds to be assigned in the DDA’s FY 2015 TIF capital improvements budget.

This brief was filed from the DDA offices at 150 S. Fifth Ave., Suite 301. A more detailed report will follow: [link]