Ann Arbor Downtown Development Authority board members Roger Hewitt (left) and Keith Orr. They're examining a Girl Scout badge created for assisting in the Downtown Blooms event. The car on the wall in the background is a mockup of the planned wayfinding system for the levels of the new underground parking structure, anticipated to open by mid-July. (Photos by the writer.)

One of those structures farther west of the campus is the new underground parking garage on South Fifth Avenue, which is nearing completion. The garage, which the DDA is currently calling the “Library Lane” parking structure, is now expected to open by the time the art fairs begin, which this year fall on July 18–21. South Fifth Avenue between Liberty and William is expected to re-open by Memorial Day.

A characterization of that timing as “on schedule” was disputed during public commentary by Ali Ramlawi, owner of the Jerusalem Garden restaurant. Jerusalem Garden is adjacent to the construction site. Ramlawi noted that the structure was originally due to be completed by August 2011.

The future use of the top of the underground garage was the subject of public commentary from advocates who’d like to see it used as a green plaza. That suggestion was met with remarks from mayor John Hieftje, who sits on the DDA board, with a description of his expectation that three major parcels would soon be incorporated into the city’s park system – 721 N. Main, 415 W. Washington, and the MichCon property (located between the Amtrak rail station and the Huron River near the Broadway bridges). Hieftje’s point was that the additional financial burden for the maintenance of those parcels as parks might impact the city’s ability to add a downtown green plaza to the park system.

Requests for better information about the parking system and suggestions for disseminating information about the availability of open parking spaces were topics of additional public commentary.

Although it was not an action item, the board discussed a draft policy on supporting “brownfield” projects – a policy prompted by discussions at the board’s partnerships committee over the last few months. [.pdf of draft DDA brownfield policy]

The committee has been discussing a proposal by Dan Ketelaar for support of a proposed development at 618 S. Main, which received a positive recommendation from the Ann Arbor planning commission on Jan. 19, 2012. If the project moves forward, the 7-story building would include 190 units for 231 bedrooms, plus two levels of parking for 121 vehicles. Ketelaar has estimated that the tax on the increment between the current valuation of the property and the final built project would yield around $250,000 a year in TIF (tax increment finance) revenue to the DDA. If adopted as it’s currently worded in the draft, the formula in the policy would translate into up to $625,000 of support for 618 S. Main.

The board also received updates on the third-quarter financial statements for the DDA, as well as an update on the Connection William Street planning project. 

The DDA manages the city’s public parking system under a contract with the city of Ann Arbor that ensures the city receives 17% of the gross parking revenues, which amounts to around $3 million annually.

So parking is typically a topic at DDA board meetings that receives a great deal of time and attention. The May 2, 2012 meeting was no different. The construction of the new parking garage on South Fifth Avenue was highlighted at the meeting in three ways: (1) public comment on future planning for the top of the underground parking garage from advocates of a public park to be constructed there; (2) a resolution to help foster usage of the new garage through differential pricing; and (3) and the regular update on construction progress.

Parking Structure Park

A request for proposals (RFP) process that could have led to the selection of a development project on the top of the underground parking structure was terminated by the Ann Arbor city council on April 4, 2011. The structure includes reinforced footings designed to support future development on the site.

Parking Structure Park: Public Comment – Library Green

Will Hathaway told the board that he was speaking on behalf of group of Ann Arborites advocating for a downtown public park – a Library Green on the Library Lot. He allowed that there are other competing views for the future of the Library Lot. He also allowed that there are also concerns about the possible impact of public open space in the downtown.

He reviewed the site plan for the top of the parking structure, given the absence of any future development on the top of the lot. The design includes 40 parking spaces, he said.

The red rectangle outlines the area where Hathaway and the Library Green advocates would like to see a public park/plaza constructed, instead of using all the available area for surface parking. (Image links to higher resolution .pdf file)

Hathaway then reviewed the configuration of the spaces that are currently planned for the top of the structure. He suggested that a public plaza be created now and proposed a configuration that would leave 18 parking spaces, but would allow for a plaza too.

He invited the DDA board to think about an interactive water feature or an ice rink or a piece of public art like The Cube as elements of the plaza. He reported that he’d been on a tour of the underground garage, which is nearing completion, and he allowed that in some ways it’s architecturally beautiful.

But it needs a better “crown,” Hathaway said, than a surface parking lot.

Eric Lipson introduced himself as a resident of Ann Arbor and former city planning commissioner. He told the board he was also wearing the hat of a Library Green advocate. He explained that as general manager of the Inter-Cooperative Council, he was also representing a stakeholder in the Connecting William Street project. The ICC houses 600 members, and its headquarters is located on East William Street, within the area of study for that project.

Lipson reminded the DDA board of the Calthorpe process that the community had engaged in around 2005. He described it as an extensive process that had included a series of design charettes. One of the ideas that had emerged was the need for a public plaza, or a “town square.” The Calthorpe report mentions a town square over a dozen times, Lipson said, and depicts such a square on the Library Lot.

Lipson called it a perfect time to revisit the question of what to put on top of the underground structure. He told the board it was doing an excellent job on the Connecting William Street project. The DDA’s planning and research specialist, Amber Miller, and executive director Susan Pollay were doing a good job, he said. The speaker series that Concentrate is sponsoring as a part of that is very useful, he said.

Right now the plan for the top of the Library Lot is for it to be a surface parking lot [until some other possible future use is identified]. But surface parking lots are anathema to active downtowns, he said. He encouraged the DDA board to put something on the site that is not a surface parking lot. He acknowledged the concern about crime and panhandlers, but characterized that as a broader issue. The community shouldn’t sacrifice the idea of a plaza because of the issue of the homeless. He said that as he moved through downtown Ann Arbor walking along the sidewalks, he was approached more and more by panhandlers – but no one is suggesting we abolish sidewalks.

Ray Detter, during his report from the downtown citizens advisory council (CAC), said that Lipson and Hathaway had spoken to the advisory council at its meeting the night before. Detter said the CAC agreed with them that a plaza space should be part of the plan. But he said that a plaza space has always been part of the plan. The CAC agreed there should be a clear-cut process for using Library Lane when it was finished. [Library Lane is the mid-block cut-through from Division Street to Fifth Avenue just north of the current location of the downtown district library.] Detter said the CAC had affirmed a long-held commitment to tax-producing private development on top of the parking garage. The CAC has always believed that whatever goes on the top of the parking garage should benefit the library, Detter concluded.

Parking Structure Park: Board Response – Three Other Parks

Responding to the remarks of Library Green advocates about the perceived problem of panhandling as an argument against additional open space in the downtown, mayor John Hieftje noted that panhandling had been the focus of a task force that had done some work on the issue. He mentioned that people would start seeing posters appear that give suggestions for ways to help without giving money to a panhandler.

[By way of background, the city of Ann Arbor previously staffed a downtown beat patrol, which many officers chose to cover by bicycle. With the reduction of the police officer force, that specific patrol assignment has been reduced to the point of elimination. Many people have contended that there's an increased panhandling and other nuisance-type crimes in downtown Ann Arbor and that it can be attributed to the elimination of the downtown beat patrol.]

So in connection with panhandling, Hieftje then took the occasion to point out that later in May, the city council would be likely to approve a budget that does not cut 9 police officers as had been planned last year, but would add one, for a net gain of 10. He also pointed out that some additional personnel would be added as part of a recruitment program.

[In May 2011, the city council approved a budget that eliminated six police officer positions, with a plan to eliminate nine additional positions this year. So compared to 2010 budgeted levels for sworn officers, preserving the nine positions and adding one leaves Ann Arbor police officer staffing at five fewer for next year. That doesn't include the proposed recruitment program, which calls for potential new hires to the department to work under the direction of sworn officers.]

Image from the city/county flood map website showing the 721 N. Main parcel. The blue area is floodway. The green area is floodplain. Two of the three buildings on the parcel are in the floodway. They could be demolished with a FEMA grant described by mayor John Hieftje. Acceptance of the grant from FEMA would require a deed restriction against development in the floodway. (Image links to floodway mapping tool.)

Continuing his remarks on panhandlers, Hieftje noted that most of them are not homeless.

Hieftje then pitched a framework for discussing the future of the top of the underground parking garage – which Library Green advocates are suggesting should become a public park. Hieftje contended that it should be considered in the context of other significant anticipated additions to the city park system.

Hieftje indicated that the city council’s May 7 meeting would include a presentation about a Federal Emergency Management Agency (FEMA) grant for demolition of buildings on the city-owned 721 N. Main property.

By way of additional background, Jerry Hancock, the city’s floodplain manager, provided some explanation about the grant, which has been awarded but still awaits some steps on the city’s part. One of those steps is updating the city’s All-Hazard Plan, which had expired, delaying the award of the grant by FEMA.

From The Chronicle’s March 5, 2012 city council meeting report:

Hancock responded by saying there’s only one other site on which the city has moved forward with FEMA applications: 721 N. Main St., a city-owned property.

The city had received approval of a grant to remove two storage structures in the floodway on the 721 N. Main site, but that grant has been delayed because the city’s All-Hazard Plan has expired. The city’s emergency manager, along with the city attorney’s office, is updating that, Hancock explained. Once that All-Hazard Plan is complete, the city will be able to move ahead with that grant. However, no other sites besides the two storage structures at 721 N. Main have been identified for FEMA applications, Hancock said.

At the DDA board meeting on May 2, Hieftje also said there was a real push being made to get the area across Main Street from the 721 N. Main property cleaned up – it’s the site of Avalon Housing‘s Near North affordable housing project, which currently has several vacant houses on it. Hieftje indicated that the city would be pursuing a state Natural Resources Trust Fund grant to make the 721 N. Main site the first of the greenway parks. It would have a linkage across Main Street under the railroad tracks to the countywide Border-to-Border Trail, he said. City staff would be investing time in planning for that, he said. Washtenaw County [parks and recreation], Hieftje reported, had agreed tentatively to participate in the project by making a match for the Natural Resources Trust Fund grant.

[Hieftje appears to have somewhat overstated the currently expected level of participation by the county's park and recreation program. In a phone interview, Bob Tetens – director of Washtenaw County parks and recreation – told The Chronicle that there was not anything yet on the table in front of the parks and recreation commission. He indicated that there'd been conversations with the city about the project, and that the idea of connecting the 721 N. Main property would be a good fit with the Connecting Communities grant program – a $600,000 annual program over five years, for a total of $3 million. Tetens also said that a project that's already partly funded through another source (like the state's Natural Resources Trust Fund) would enhance a project's application. However, there are more applications for various projects every year than Washtenaw County parks and recreation can fund through the Connecting Communities program, Tetens said.]

Hieftje characterized the land at 721 N. Main as something that the city needs to do something with – because the city doesn’t want to contribute to blight. [The property was previously the city's fleet maintenance yard, but was closed when the Wheeler Service Center opened in 2007.] He also reported that he’d been working with community members on the city-owned 415 W. Washington property. He said that not much progress has been made because of the condition of the old building. By council resolution, he said, that parcel will be a greenway park. [The council resolutions to which Hieftje is referring don't appear to commit the entire parcel to becoming a greenway park.]

Environmental cleanup work is being done on the MichCon property, located between the Amtrak rail station and the Huron River, near the Broadway bridges. Hieftje stated he hoped that would also become a park – across from the new whitewater features to be constructed in connection with the Argo Dam bypass, now called the Argo Cascades.

So as people start to think about adding parks, he said, people need to think about how to maintain them. According to the park advisory commission, Hieftje said, the city is at the limit of being able to maintain parks. Because the city already owns the 721 N. Main site, and because the MichCon property is one the city has wanted for 40 years to be cleaned up and added to the park system, those would be “first in line,” he stated. The capacity to care for another park will stretched, Hieftje said. He recommended to people who are working on the Library Green to take that into account: How will we maintain the park? Also, Hieftje invited Library Green advocates to think about how that fit into the competing interests of three large new parks that will need planning, development and maintenance.

Hieftje also said that he’d be recommending to the park advisory commission that they take up the issue of how to re-design Liberty Plaza [at Division and Liberty streets] so that it becomes a more active center and not something that people avoid. It’s fortunate that First Martin cares for the park, Hieftje said. [First Martin is an Ann Arbor firm that owns the building adjacent to Liberty Plaza.]

Picking up on Hieftje’s comments, Sandi Smith noted that the Connecting William Street committee members would have the future of the top of the underground parking garage on their radar as well, and noted that Liberty Plaza is within the boundary of the study area. Trying to maintain and activate two parks within the same block seems to be a difficult chore, she said.

Responding to Hieftje’s comments during the second opportunity for public comment at the end of the meeting, Jerusalem Garden owner Ali Ramlawi suggested that one idea of funding the maintenance for a public park plaza on top of the parking garage would be to take a fraction of a percent of the parking revenues collected from the structure.

Parking Demand Management

Parking demand management is basically a strategy of differential pricing – higher for higher demand areas and lower for lower demand areas – to try to optimize the available parking spaces in the system. At an April 9, 2012 city council work session, Ward 1 city councilmember Sabra Briere had asked DDA board member Roger Hewitt when residents could expect to see demand-management strategies implemented. At that work session, Hewitt had been presenting the DDA annual budget to the council.

Parking Demand Management: Resolution on Permits

At their May 2 meeting, the DDA board considered a resolution authorizing its operations committee (aka bricks & money and transportation committee) to use demand-management strategies to price monthly parking permits in Ann Arbor’s public parking system. The goal of adjusting monthly parking permit rates is to expand campus-area parking to structures other than those immediately adjacent to the University of Michigan campus. In broad strokes, “demand-management strategies” means pricing the most desirable parking options higher than those that are less desirable.

The move comes as the opening of the new underground parking structure on South Fifth Avenue, offering around 700 total spaces, is set to open by the start of the Ann Arbor art fairs, which this year run from July 18-21. Monthly permits for some of the spaces will be offered at the new structure, which will add to the five public parking structures where permits are available: Ann & Ashley, Forest Avenue, Fourth & William, Liberty Square (Tally Hall), and Maynard.

Under a demand-management strategy, prices of monthly permits at the underground parking structure are likely to be lower than at other structures.

The Ps denote parking structures offering monthly permit parking. (Image links to Google map.)

Hewitt noted that the DDA has been focusing on the completion of the new underground parking garage and has not had time to pay as much attention to parking demand-management initiatives.

As the DDA gets closer to opening the new underground garage, Hewitt said, the idea is to look at carrots and sticks for evening out the usage in the system. Rather than forcing people to move their permits from structures in high demand to those that are in lower demand, the idea is to offer incentives. There’s a number of ideas to relieve the pressure on the structures closest to campus – Forest, Maynard and Liberty Square. The idea is to move those folks into the new underground structure or the Fourth & William structure, he said.

The resolution authorized the operations committee to use parking demand management to alter rates to even out the demand in the system, he said.

Newcombe Clark questioned why there was an explicit mention of “two blocks west” in one of the “whereas” clauses. Hewitt assured him that the intent was to explore parking demand management for monthly permits throughout the system, without any particular boundary.

Outcome: The DDA board unanimously approved the resolution authorizing the operations committee to use parking demand management strategies to alter monthly parking permit rates.

Parking Demand Management: DDA-City Contract

The  Ann Arbor Downtown Development Authority manages Ann Arbor’s public parking system under contract with the city. The DDA has the unilateral ability to set parking rates. To implement an increase, the DDA is required under the contract to complete a series of steps designed to ensure adequate notice and public input before implementation of a rate increase. From the contract [emphasis]:

Notwithstanding the foregoing, DDA shall not implement any increase in the Municipal Parking System’s hours of meter operation or parking rates intended to persist for more than three (3) months without first: (i) announcing, and providing written communication regarding, the details of such increase at a meeting of the DDA Board; (ii) providing all members of the public an opportunity to speak in a manner similar to a public hearing before the DDA Board at its next regularly scheduled meeting on the subject of the proposed increase (“Public Hearing”); and (iii) postponing any vote on the proposed increase until at least the regularly scheduled meeting of the DDA Board after the Public Hearing

The changes to the monthly permit system, which Hewitt characterized as “incentives,” do not appear to involve rate increases, but perhaps only decreases. So the various steps outlined in that contract clause would not apply.

Parking Demand Management: Public Comment

Edward Vielmetti addressed the board during the second opportunity for public commentary, and focused on the topic of demand management pricing. He ventured that sometimes people don’t have much of a choice as to where they can park and they pay whatever price they have to pay – because they don’t know much about what their alternatives are.

In addition to improved communication about availability of spaces, Vielmetti asked for better communication about information on the parking system performance – as opposed to simple pronouncements about the parking system being at full capacity.

Vielmetti also addressed the board at the start of the meeting on the topic of relatively low-tech ways to get parking space availability information to people who need it – people who are looking for a place to park.

He shared an experience he had visiting Toledo to watch the Toledo Mud Hens play. It’s usually easy to find a place to park, he said, and if the lots near the stadium are full, there are usually other lots that are easy enough to find. But on the occasion of the visit he described to the DDA board, the Detroit Tigers were playing, and all the lots were filled up. So he had to navigate using his wits and found the farmer’s market, which offered free parking.

Part of the challenge of parking in an unfamiliar place, he said, is not knowing the lay of the land. You have to figure out if the place you want to park is legal, and you might not know if the structure you know exists is already full. He said that what was fascinating about Toledo was not any kind of fancy smart phone application that anyone had running, but rather a sign at the border that advised people to tune their radios to AM 1640. That’s a station that tells you how much traffic was on the roads to get to the stadium, or to get to downtown Toledo from the Michigan border.

The radio station, Vielmetti said, would give estimated travel times to different places, on a constant loop. Every few minutes the information would be updated. It’s a low-power AM station that you can only hear in Toledo, he said. He suggested that setting up such a station would be within the means of any municipality or a public body like the DDA, and the radio station could tell people a little bit about what they need to do in the downtown. The DDA already has realtime parking information available, so potentially that information could be broadcast every three minutes and listeners could hear something like “All the lots have spaces available,” or if the Fourth and Washington structure is full, then it could advise people to use the underground garage.

Vielmetti said he wanted to revisit the realtime parking information issue that he’d raised with the DDA back in 2009. This time around, he said, he didn’t want to look at “fancy things” that only people with fancy phones could use, but something that people could tune into from their car radio.

Parking Demand Management: Parking Report

A report of the monthly parking figures are a standard part of every DDA board meeting. Generally, the message conveyed by Roger Hewitt is that revenues are up in excess of the rate increase, which he interprets as an indicator that demand for parking is increasing.

For the past few months, The Chronicle has charted out revenues and hourly patrons in the system as reflected in the DDA’s monthly reports over the last couple of years. Hourly patrons don’t include people who park at on-street meters, but rather those who pay hourly at a parking structure – as opposed to parking there using a monthly permit.

Ann Arbor public parking system revenue through March 31, 2012. (Image links to higher resolution file.)

Ann Arbor public parking system hourly patrons (in structures) through March 31, 2012. (Image links to higher resolution file.)

Parking Garage Construction

At its monthly meetings, the DDA board typically receives a report on the progress toward completion of the new underground parking garage on South Fifth Avenue. It will offer around 700 spaces underground. The surface lot that existed there previously offered 192 spaces.

Parking Garage Construction – Public Comment

Ali Ramlawi introduced himself as the owner of the Jerusalem Garden and a resident of Ward 5 – but he allowed that board members already knew who he was. [Ramlawi has addressed the board previously to raise essentially the same issues he did at the May 2 meeting.]

He described the construction of the underground parking structure as stretching now into its fourth calendar year, but was not yet complete. [The ceremonial groundbreaking took place in October 2009.] He reviewed some of the issues he’s raised before – loss of income, disruption in deliveries, forced evacuation [due to the emergence of a sinkhole]. He questioned how the construction contract was awarded to the Christman Company and contended that the choice of subcontractors by Christman had raised some eyebrows. He contended that the original contract with Christman had no penalties for being late and no reward for finishing on time. No one is held accountable, he complained. With the powers and budget the DDA board members have, they need to do a better job of awarding contacts, he said. If this were the private sector, he contended, someone would have been fired. Where are the penalties for the lateness? he asked.

He told the board that when they have the ceremonial opening celebration he would not be around for it because he didn’t want to “puke over [himself].”

Parking Garage Construction – Board Report

John Splitt gave the update on the construction of the underground garage. Work continues on the mechanicals. The most exciting part of things, he said, is that the backfilling on the plaza level is going along nicely and the waterproofing is almost complete. Backfilling on the “bridge” section, which will allow the re-opening of South Fifth Avenue, is almost complete, he said. Curbs are beginning to be formed on South Fifth Avenue. It’s on schedule to reopen by the end of May, and it’s anticipated that the underground garage will be open by the time that the art fairs start, he said. The fairs run from July 18-21 this year.

During the second opportunity for public commentary near the end of the meeting, Ali Ramlawi objected to Splitt’s use of the phrase “on schedule to open,” saying that the project is a year behind schedule. He contended that saying it was on schedule undermined the DDA’s credibility.

Following up on Splitt’s construction summary, Newcombe Clark asked that the depiction of the Lincoln Continental on the meeting room’s wall be explained, so that people did not think the DDA was getting into the sponsorship business. Splitt explained that it’s part of the underground garage wayfinding system – which will use both colors and four different automobiles to identify floors. The car is a mockup of a wayfinding sign.

“Brownfield” Policy Draft

The DDA board considered a draft policy on supporting “brownfield” projects – a policy prompted by discussions at the board’s partnerships committee over the last few months. [.pdf of draft DDA brownfield policy] The board was not expected to act on the policy, and did not vote.

“Brownfield” Policy Draft: Background

The DDA’s partnerships committee has been discussing a proposal by Dan Ketelaar for support of a proposed development at 618 S. Main, which received a positive recommendation from the Ann Arbor planning commission on Jan. 19, 2012. The 7-story building would include 190 units for 231 bedrooms, plus two levels of parking for 121 vehicles. Ketelaar has estimated that the tax on the increment between the current valuation of the property and the final built project would yield around $250,000 a year in TIF (tax increment finance) revenue to the DDA.

Ketelaar is asking that the DDA pledge 80% of its TIF capture money for six years – about $1.3 million – to support certain aspects of the project in connection with the state’s Community Revitalization Program. The CRP is the successor to the brownfield and historic preservation tax credit programs. In order to approve the tax credit, the state would like to see a commensurate commitment from local units – and Ketelaar is proposing that it take the form of the DDA’s support.

At the April 11, 2012 DDA partnerships committee meeting, one of the points that resonated strongest with some board members in favor of supporting the 618 S. Main project was the ability of the contribution to leverage state money that would otherwise not be invested in Ann Arbor. The amount of money from the state that could be leveraged is in the range of $3 million.

Under Ketelaar’s proposal, taxes on the property would still need to be paid. In other words, the DDA would not simply waive its tax capture on the property. The 618 S. Main project would be reimbursed for a portion of those taxes it would normally owe. In the draft policy, that’s reflected in the following passage: “The DDA will not forgo its TIF capture from a project; the DDA may elect to provide a grant to a project utilizing its funds, or it may elect to provide all or some of its support using such in-kind elements as access to parking for contractors or construction staging.”

The maximum amount of a possible grant described in the draft policy is “calculated by estimating 25% of the total TIF captured by a project over ten years.” In the case of the 618 S. Main project, that amounts to .25*(10*$250,000) = $625,000. That’s about half what the 618 S. Main project is requesting.

The DDA board has heard about the proposal on several occasions – first at the full board meeting on Feb. 1, 2012, and at four subsequent DDA partnerships committee meetings. DDA board members are cautious about the precedent that such a pledge might set, and the appropriateness of the DDA’s role at this early stage in the project. (Ketelaar has not yet acquired the land.) At the March 28 partnerships committee meeting, DDA board member Newcombe Clark expressed concern that, depending on the precise role defined for the DDA’s participation, the DDA could effectively be artificially inflating land values.

“Brownfield” Policy Draft: Board Discussion

Sandi Smith introduced the draft policy. Looking at the 618 S. Main project caused the partnerships committee to take a really hard look at the reasons why the DDA would participate in the project at all, some or a lot, she said. The committee felt that it was struggling with the idea of creating a precedent. So the committee wanted to make a strong policy statement that the DDA would be able to honor for the 618 S. Main project, as well as for projects that came after it.

She walked the board through some of the highlights of the draft policy. She said she was looking for board-wide feedback for further work by the partnerships committee.

Roger Hewitt said that a lot of his concerns were addressed by the draft policy – about the subjectivity of picking projects. He liked the idea of getting rid of as much subjectivity as possible. The idea of a state match was good, he said, as well as the idea that the only costs to be reimbursed would be public infrastructure, not parts of the development itself. He also wanted to make sure that the DDA would not be paying out more than the DDA would receive in TIF capture.

Smith assured Hewitt that nothing would be paid until the taxes have been paid. The DDA would never be in a position of being ahead of the taxes it had received. Hewitt said his concern was that the amount of the grant could become a larger percentage of the TIF, if the value of the project actually went down. He wanted some way to protect against that. Keith Orr suggested some kind of clause that states that while the grant amount would be based on the estimated value of the TIF capture, the payout would be capped by the actual value.

Russ Collins noted that the scenario that Hewitt was describing involved possibly paying out more than anticipated, but not more than the DDA was capturing. John Splitt noted that there could be flexibility to pay out sooner than the actual TIF capture was received, so that’s where the issue could arise – if it were paid out on a schedule sooner than the 10 years.

Splitt wondered if 25% was enough to make a difference in the project. Bob Guenzel clarified that “enough” meant whether it was enough to actually provide the matching leverage for state funds. Smith responded by saying that for past projects, the Liberty Lofts project [a residential development at Liberty and First] had been the most significant one – and that had amounted to 17% of the TIF over 10 years. Taking all that into account, she wondered if 25% was too high or too low.

Keith Orr agreed with the idea of making it as objective as possible and focusing on public infrastructure.

Newcombe Clark said he was happy that the DDA has continued to be creative even when the organization doesn’t have a lot of money. He appreciated the patience of Ketelaar, watching the “sausage making.” Clark said he’d enjoyed the process. Maybe the DDA didn’t make everyone happy or didn’t get it right the first time, he said – that’s always possible. He knew it was not perfect, but he felt that as a group the DDA board could pick it back up and shine it up some more. He said he’d had the fear that for a few years there’d be nothing the DDA would be able to do [because of diminished financial capacity] and he’d been proven wrong.

Collins quipped that he found Clark’s positive and optimistic attitude completely inappropriate, which drew laughs around the table. On a more serious note, Collins said that the DDA had structured itself as an organization that tends to assets. That causes a certain amount of fiscal conservatism. The draft brownfield policy, therefore, is very conservative, he said. But by being conservative, the DDA could miss the chance to be a stimulus to other private investment, which is the core of the DDA’s mission, he said. That’s the constant tension a DDA has, he ventured.

Clark suggested that based on past experience, once the DDA creates policies, it lays down the rules of engagement, and then people will line up with proposals. Collins continued with his friendly ribbing of Clark, saying that Clark’s unmitigated optimism was completely out of character.

During his report from the downtown citizens advisory council (CAC), Ray Detter congratulated the DDA on the formulation of the draft policy. He said the CAC supports the project and is confident the DDA is developing a consistent policy that will be fair to everyone.

Outcome: The draft policy was not before the board for a vote. It will be subjected to further discussion by the partnerships committee.

Third Quarter Financials

Roger Hewitt reviewed the financial statements for third quarter, through March 31, 2012. The DDA’s accounting system includes four funds: the TIF (tax increment finance) fund, which gets its revenue from tax capture; the parking fund, which receives revenue from the public parking system; the parking maintenance fund, which gets revenue through transfers from the parking fund; and the housing fund, which gets revenue through transfers from the TIF fund. [.pdf of DDA  financial picture through March 31, 2012]

The tax increment finance (TIF) income is anticipated to be $200,000 below budgeted – $3.7 million instead of $3.9 million, Hewitt reported. The drop, he said, is primarily due to changes in personal property, not changes to real property. Personal property depreciates quickly, he said. Operating expenses will be about $250,000 below budget, primarily from less use of consultants and lower administrative expenses. Only about $45,000 in capital expenses are shown so far, he said, but he anticipated that number would be right around $1 million at the end of the fiscal year.

That figure will come from the Fifth and Division streetscape improvements project and a portion of the “Library Lane” parking structure. Overall, he said, the DDA had budgeted for around a $1.5 million use of fund balance. Now, said Hewitt, it looks like it would be around $1.44 million of fund reserves that would need to be used. Hewitt pointed out that the use of fund balance was planned, and the natural consequence of accruing capital funds to pay for major construction projects and then using the money.

Revenue for the public parking system is anticipated to be around $17 million, or about $800,000 more than anticipated. The rate increases had been budgeted into the anticipated revenue, he said, so he attributed the additional revenue to increased demand. He stated that the DDA continues to see strong growth in demand for parking. It’s fortunate that the “Library Lane” parking structure is coming on line when it is, because the system is at capacity, he said, at least in the campus area and at the Ann Ashley parking structure.

Direct operating expenses are expected to be $800,000 less than expected. That has to do with the fact that Republic Parking – the DDA’s contractor for day-to-day parking operations – is doing a good job at belt-tightening and is efficient in its operations, Hewitt said. He commended Art Lowe, Republic Parking manager, and his staff for keeping costs in line. Overall, it looks like the parking fund will be around $1 million to the positive.

Parking maintenance has received around $2 million, he said, which is right where the DDA anticipated being. The DDA has not spent money on maintenance that it would have ordinarily done, but the DDA is so far ahead on preventive maintenance that it was able to scale back without any concern about the structural integrity or long-term durability of the structures, he said. So parking structure maintenance has been conservative. There’s been about $1.6 million less spent on maintenance than what had been budgeted. That money will be there for future years as needed, Hewitt said.

The only income into the housing fund was due to interest. About $500,000 had been budgeted for Avalon Housing’s Near North project, but that project has not gone forward. The $500,000 is not due to be paid until Avalon has a certificate of occupancy, and that shows as under budget on the expense side for the housing fund.

Summarizing the financial picture in terms of fund balances, Hewitt gave the following round figures: TIF fund – $6.5 million; housing fund – $1 million; parking fund – $2 million; and parking maintenance – $1.8 million. Total fund balance is $11,444,000, he said. That will certainly be drawn lower as the Fifth and Division streetscape and the “Library Lane” parking structure projects are paid off, he said, but the DDA still has adequate cash.

Communications, Committee Reports

The board’s meeting included a usual range of miscellaneous reports from its standing committees and the downtown citizens advisory council, as well as public commentary. To the extent that significant issues are not already included in the other parts of the meeting report, we include them here.

Comm/Comm: Connecting William Street

Joan Lowenstein gave an update on the Connecting William Street project – an effort the DDA is making under the direction of the city council to find alternate uses for city-owned parcels currently used for surface parking. Lowenstein said that the DDA’s leadership and outreach committee is continuing and increasing efforts to bring different “scenarios” to the public. The scenarios won’t be exact building drawings, but there would be more detail in them, she said. In mid- to late June there’d be something concrete to bring to the public.

Focus group meetings will continue in an effort to shape scenarios. A meeting with members of the city’s park advisory commission had taken place. On May 16, the committee would hear the market analysis findings that will shape the scenarios, based on survey feedback and the market analysis. Throughout the month of June, the committee was moving ahead to have something to show people and get feedback.

The next event in the Concentrate speaker series, focusing on land-use economics, will take place on May 17 at 5 p.m. at Conor O’Neill’s, Lowenstein said.

Comm/Comm: Commuter Challenge

Nancy Shore, director of the getDowntown program, gave the board a brief update on the Commuter Challenge, which getDowntown sponsors annually during the month of May.

Comm/Comm: Girl Scouts

Girl Scout badge design for "Spring Blooms" park cleanup day. The DDA is camouflaged into the design.

Board members were given a Girl Scout badge that’s been created in connection with the parks cleanup day, Spring Blooms. Girl Scouts can earn the badge by participating in the event, DDA executive director Susan Pollay said.

Pollay noted that the DDA name was hidden within the badge design.

This year, the event falls on Saturday, May 19. The assembly point is Liberty Plaza at Division and Liberty. Said Pollay: “We will go forth and clean up the downtown!”

Present: Nader Nassif, Newcombe Clark, Bob Guenzel, Roger Hewitt, John Hieftje, John Splitt, Sandi Smith, Russ Collins, Keith Orr, Joan Lowenstein.

Absent: John Mouat, Leah Gunn.

Next board meeting: Noon on Wednesday, June 6, 2012, at the DDA offices, 150 S. Fifth Ave., Suite 301. [confirm date]

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David Olson, vice president of Granger Construction Co., delivered a letter to the DDA board during public commentary, which questioned the way concrete bids were handled for the DDA's underground parking garage. The garage is currently under construction along Fifth Avenue. (Photos by the writer.)

Though not addressed by the board as business items, two areas of controversy emerged during public commentary.

One involves the award of a bid as part of the DDA’s construction of the underground parking garage along Fifth Avenue. The contract for construction management for the entire project was awarded to The Christman Co. However, under the terms of the contract, Christman must bid out various components of the project, like the concrete work – even though Christman has the capability of doing that work itself.

The low bid for the concrete work was submitted by Granger Construction Co., at $21.5 million. But Christman awarded the contract to Christman Constructors Inc., which had submitted a bid of $22 million. Christman’s selection as construction manager of the project had been finalized at the DDA board’s Nov. 4, 2009 meeting with a guaranteed maximum price of $44,381,573. Representatives of Christman and Granger aired their differing points of view on the concrete bid at Wednesday’s meeting, with DDA board chair John Splitt concluding that he was satisfied the process had been fair.

The other point of controversy arising during public commentary is the probable $2 million payment this year by the DDA to the city of Ann Arbor – which it has no obligation to make under its current parking agreement with the city. The city’s budget book for FY 2011, released on Monday, does not factor in a payment from the DDA. Instead, it shows a $1.5 million shortfall for the year. The DDA’s parking report to the city council hints at the possibility that the DDA would take responsibility for the ticketing of parking violations. That change in enforcement could be included in the renegotiation of the parking agreement.

Other business transacted by the board on Wednesday included a resolution calling on the city council to revise its sign ordinance so that downtown merchants could use sandwich board signs legally. A recent attempt to revise the ordinance by the council was voted down at its Feb. 16, 2010 meeting.

DDA Parking Report to the City Council

At its Dec. 21, 2009 meeting, the Ann Arbor city council considered a resolution addressing parking revenues. The resolution was brought forward by Sandi Smith, who serves on the city council representing Ward 1, as well as on the DDA board. From The Chronicle’s coverage of that meeting [emphasis added]:

In its original form, the resolution had three key points: (i) net revenues from the Fifth and William (old YMCA) lot would go into city rather than DDA coffers, (ii) downtown parking meters would operate and be enforced until 10 p.m., which is later than their current cutoff of 6 p.m., and (iii) the city would discontinue its plan to install its own parking meters in neighborhoods near the downtown.

With respect to its substance, the part of the resolution generating the most resistance was (ii) with its extended hours of meter enforcement for on-street parking. Smith swapped out that provision for one somewhat more vague, and the council eventually adopted a resolution that requested a report from the DDA on the issue of extended meter enforcement:

RESOLVED, The City requests that the DDA present a plan to Council at its April 19, 2010 meeting for a public parking management plan. The plan should include but is not limited to:

• a communication plan to Downtown patrons, merchants and evening employees
• options for low cost parking for evening employees
• variation of rates and meter time limits based on meter location
• hours of enforcement

It is this plan that the DDA board voted to endorse on Wednesday. Final tweaking will take place at the board’s partnerships committee meeting next week.

The report is structured around eight strategies:

Strategy 1: Downtown curbside public parking should be managed to create turnover at the most convenient, commercial locations so these spaces can be more easily used by a large pool of downtown users.

Strategy 2: A comprehensive TDM [transportation demand management] strategy should be developed and utilized to support the downtown evening economy, including a management strategy for on‐street parking spaces, creation of additional evening employee parking/transportation options and communication strategies.

Strategy 3: Develop new off-street parking strategies to make it more attractive for patrons to park off‐street in public parking facilities, and thus relieve pressure on curbside parking, support downtown commerce and entertainment, and increase patron awareness of their parking use and costs.

Strategy 4: Develop policies and plans to add and subtract public parking downtown based on redevelopment, walkability, and transportation goals.

Strategy 5: Develop additional parking options for personal transportation vehicles, including motorcycles, bicycles, and vehicles using new energy.

Strategy 6: Increase downtown employee use of public transit by expanding AATA service hours, developing a strong Ypsilanti/Ann Arbor transit plan, and making downtown transit stops more user‐friendly.

Strategy 7: Improve communications to downtown business owners, employees, customers and visitors by developing new communication tools and sharing information more broadly.

Strategy 8: Develop a parking and transportation strategy for downtown & near downtown residents

One of the tactics for implementing Strategy 2 is a recommendation to extend time limits on parking spots from two to three hours in certain areas.

Another tactic for implementing Strategy 2 is a recommendation to change meter enforcement hours from 8 a.m.‐6 p.m. to 9 a.m.-9 p.m. This reflects the report’s genesis as a request from the city council to the DDA, when the council was confronted with a resolution that would have extended the hours of meter enforcement. That recommendation will likely generate the most controversy, and this was reflected in public commentary at the DDA’s Wednesday meeting.

Parking Report: Public Commentary

Ray Detter, in his report to the board on the Downtown Citizens Advisory Council‘s meeting the night before, said that DDA executive director Susan Pollay had attended the meeting to give a summary of the parking report. Detter supported the idea that the DDA was the only entity equipped to administer parking operations.

Commenting on behalf of the Main Street Area Association, Tony Lupo took the podium for his allotted four minutes at the start of the board meeting. Lupo indicated that the MSAA had held information meetings and participated in the DDA’s process for receiving public feedback for the report. He reported that there was overwhelming opposition to extending the meter enforcement hours.

However, he allowed that the MSAA understood the context under which extended hours were being considered – the city’s need for revenue. What was important, Lupo said, was to couple any extension of meter enforcement hours past 6 p.m. with some kind of offsetting enhancements like increasing the maximum time to three hours – from its current limit of two hours – and offering free parking during certain hours. Lupo stated that MSAA would like to contribute to the marketing strategy for the plan.

In that context, Lupo suggested that it didn’t make sense to “shift” the time of meter enforcement from its current window of 8 a.m.-6 p.m. to 9 a.m.-9 p.m. That essentially offers a free hour of parking when it’s not in high demand. It would be better, said Lupo, to offer a free hour of parking sometime after 6 p.m. – that’s something it could be headlined as a benefit in a marketing effort. [Lupo is marketing director for Salon Vox on West Liberty Street.]

Parking Report: Transportation/Operations Committee Deliberations

At the board’s joint transportation and operations committee meeting the previous Wednesday, March 31, 2010, committee members hashed through a number of issues related to the parking report. Those ranged from presentational issues to more substantive questions.

Among the presentational issues was the question of whether to include parking rates in the body of the report or put them in an appendix. Putting actual numbers in the body of the report, suggested Newcombe Clark, would make the report immediately dated. Transportation committee chair John Mouat suggested putting the numbers in an appendix. Board chair John Splitt feared that if they did not include the numbers for rates, they would lose control of the discussion: “They’re real numbers, why not put them in there?” The rates will be included in an appendix.

Among the more substantive issues discussed at the joint committee meeting related to control of enforcement. In a section of the report describing benchmarking data from other communities, the following observation is made [emphasis added]:

Through examination of other communities, we learned the following: … Parking enforcement and parking operations are often managed jointly by one agency.

Elsewhere, the report states:

Parking enforcement and parking operations are two halves of the same parking system. Optimally, enforcement and operations strategies are planned and managed together.

In Ann Arbor, parking operations are handled by the DDA through a contract with Republic Parking. Enforcement, on the other hand, is handled by the city of Ann Arbor through police and community standards officers.

At the committee meeting, the question was raised: Why don’t we just say it – we want to take over enforcement. This is an idea that came out of the first meeting that the DDA’s “mutually beneficial” committee held last year. The DDA and the city have ad hoc “mutually beneficial” committees, charged with renegotiating the parking agreement between the two entities. At the time of that first meeting of the DDA’s committee, the city had not yet appointed a corresponding “mutually beneficial” committee.

Parking Report: Who Enforces Meters, and the City Budget Gap

The key facts about that city-DDA parking agreement were summarized during public commentary at Wednesday’s board meeting by Bob Dascola, who owns Dascola Barbers on South State Street. In 2005, the agreement between the city and the DDA was renegotiated to extend 10 years through 2015, with the annual payment by the DDA to the city in the amount of $1 million.

A provision of that agreement allows for the city to request a payment of $2 million in any given year, with the condition that the total amount over the 10-year period can’t exceed $10 million. Now five years into the contract, the city has requested $2 million each of the first five years. So, for the upcoming year, FY 2011,  the DDA does not owe the city anything under that contract.

Dascola weighed in against the idea that the DDA should voluntarily renegotiate the contract, saying that the DDA was not an ATM.

The DDA “mutually beneficial” committee’s initial discussions, which began last year, centered around the idea of an arrangement that would be more complex than the DDA simply writing an additional check to the city.

From The Chronicle’s report of the April 1, 2009 DDA board meeting [emphasis added]:

[Rene] Greff  [who chaired that committee at the time, but no longer serves on the DDA board] then ticked through what the committee had done. They had: (i) reviewed history of DDA parking agreements with the city, (ii) reviewed TIF (tax increment financing) capture, and (iii) reached a majority view – with dissent from Hewitt – that they should not re-open the discussion of the existing parking agreement. It was not the role of the DDA, Greff said, to cover gaps in the city budget. The committee had given some consideration to taking over city tax-funded activities (e.g., snow removal), and had contemplated purchasing the right to meter enforcement in downtown. The latter would allow the DDA to control a piece of the public’s experience with the downtown area.

Board member Leah Gunn asked about the city’s side of the committee. Greff explained that the city council had not yet seated their committee, and the DDA contingent had met so that they would have something more concrete to bring to the table when the first meetings with the city took place.

The two committees have not, to The Chronicle’s knowledge, ever met. Sandi Smith, who serves on the DDA’s committee, has reported at DDA board meetings for a number of months that there was nothing to report. At the last two DDA board meetings, Roger Hewitt reported only that informal talks had taken place.

The Chronicle noted in its previous coverage that the city’s committee meetings can be expected to be noticed for the public beforehand and made accessible to the public [from "City-DDA Parking Deal Possible" – which also includes a history of the respective "mutually beneficial" committees]:

If and when the two “mutually beneficial” committees from the DDA and the city council meet, it’s reasonable to expect that the meetings will be open to the public and announced in accordance with the Open Meetings Act.

While the committee membership from the city council would not amount to a quorum, a resolution passed at its Nov. 4, 1991 meeting by the Ann Arbor city council expresses the council’s will that its committees adhere, to the best of its abilities, with the requirements of the OMA:

R-642-11-91

RESOLUTION REGARDING OPEN MEETINGS FOR CITY
COMMITTEES, COMMISSIONS, BOARDS AND TASK FORCES

Whereas, The City Council desires that all meetings of City boards, task forces, commissions and committees conform to the spirit of the Open Meetings Act;

RESOLVED, That all City boards, task forces, commissions, committees and their subcommittees hold their meetings open to the public to the best of their abilities in the spirit of Section 3 of the Open Meetings Act; and

RESOLVED, That closed meetings of such bodies be held only under situations where a closed meeting would be authorized in the spirit of the Open Meetings Act.

At the DDA’s joint transportation and operations committee meeting last week, in response to the suggestion that the parking report simply state that the DDA wanted to take over meter enforcement, Susan Pollay, executive director of the DDA, said that would be “presumptuous.”

Responding to Pollay, Newcombe Clark clarified with her that the parking report was to be submitted to the city council on April 19. And the inclusion of meter enforcement by the DDA would be reasonable, Clark said, because it was within a few weeks of an expected compromise between the city and the DDA on the parking deal. Polly replied that she was not aware of a compromise.

Gary Boren then weighed in, saying it was his understanding that the city’s budget was being prepared without an assumption that the DDA would be making a $2 million payment. On the Monday following that March 31 committee meeting, the city released its budget book, which does not assume a $2 million payment from the DDA – it shows a roughly $1.5 million deficit for the year.

The issue of who has responsibility for meter enforcement is not just a matter of which agency – the city or the DDA – can insist on the right to do so. The parking report contains a number of recommendations that would seem to require either an intensely close working relationship between the agencies administering operations and enforcement, or else require that it be a single agency administering both. For example, the recommended tactics to implement Strategy 1 include the following:

• To lessen patron frustration about receiving a ticket, improve information on parking tickets & envelopes, including how to pay online or avoid a ticket in the future.
• Improve website information and provide a feedback mechanism unrelated to contesting parking tickets.
• Pursue ideas that would make it possible to pay for parking tickets and stored value meter cards in one location, providing increased convenience to customers.
• Explore making it possible to pay parking tickets at the epark machines as a way of reducing patron inconvenience and frustration.
• Explore making it possible to pay for parking tickets at banks, thus reducing the number of patrons who feel compelled to come to City Hall for this function. Determine if it is feasible for downtown banks to dispense stored value meter cards.

Counter to the original impetus behind extended hours of enforcement – an effort to generate additional revenue – is a goal of fewer tickets expressed in the report:

… parking operations and enforcement should be managed so that the number of parking tickets eventually decreases and the number of patrons complying with parking regulations increases.

Parking Report: DDA Board Deliberations

Roger Hewitt led off deliberations on the parking plan, saying that it embodies 18 years of experience by the DDA in managing parking operations. It reflected a lot of hard work and public process in a very short amount of time, he said. He noted that it had been reviewed in detail by the transportation and operations committees. The partnerships committee would do the final edit, he said, at its meeting later in the month.

Hewitt stressed that it was not just a parking plan – it’s a transportation management plan. He allowed that some of the recommendations are controversial. However, he noted that the strictly daytime economy in downtown has undergone a shift in the last 20-30 years and that there’s now a nighttime economy. The parking report contains recommendations, Hewitt said, about extended meter enforcement and geographically determined meter rates.

Newcombe Clark also praised the work of the staff. He emphasized that the DDA did not know for sure what would happen when some of the recommendations were implemented – as he put it, “when we start pulling these levers.” Clark said the DDA owed it to itself to do baseline calculations so that it could ascertain whether the demand management measures resulted in a revenue loss, a large surplus, or was simply a wash. He wanted the DDA to start looking at spreadsheets on what might happen.

John Mouat characterized the daytime parking activity in the past as essentially static, in contrast to the more dynamic pattern of nighttime parking. He said the plan itself was dynamic, not set in stone. The plan’s essence was about choices, he concluded.

Keith Orr also gave kudos to the staff, saying they’d done the work “under the gun.” Orr agreed with Clark on the need to model the various impacts of the measures when they are implemented. Responding to Lupo’s public  commentary – when Lupo  expressed some concern that the language in the report used to describe some of the enhancements was not as strong as that describing the extended enforcement – Orr said the DDA was an organization with a good history of testing plans. They’d implemented or tested everything in the Nelson\Nygaard study, he said.

Sandi Smith thanked the staff for their heroic effort. She said that in an informal survey she’d done of nighttime workers, she’d learned that a lot of people don’t realize that parking after 6 p.m. is currently free. So she was cautious about any assumption that extending meter enforcement would have a dramatic change in revenues.

Mayor John Hieftje noted that he didn’t think the document looked like it had been prepared under the gun. He said the idea of extended hours of meter enforcement would be controversial.

Leah Gunn thanked Mouat and Hewitt for chairing the combined committee meetings that worked on the parking plan. She called the plan a “tour de force.” Some things are not knowable, she allowed, but you don’t know until you try.

Outcome: The DDA parking report received the unanimous endorsement of the DDA board.

Parking Report: ParkingCarma

Related to a theme of transportation demand management was a presentation made by Rick Warner of ParkingCarma during public commentary. In discussions on the operations committee report, Leah Gunn also said she was intrigued with ParkingCarma. And Roger Hewitt said he could add ParkingCarma to the next meeting of the operations committee.

What had intrigued Gunn? Warner pitched the idea of a partnership between the DDA and ParkingCarma. He described ParkingCarma’s business, which uses a variety of technologies to make parking easier. Before the meeting, Warner described it for The Chronicle as “like Orbitz for parking.” Warner described how ParkingCarma had already inventoried all the off-street parking in Ann Arbor, and had partnered with Google Local Business Center to provide parking information to Google. That provides a way for potential customers to get information about the closest available parking locations to that business.

Warner also sketched out a way to integrate into a parking system, so that the owner of that system could accept pre-paid reservations for parking. Premiums could be collected for special events, or patrons could be directed to lower-demand spaces to optimize the parking inventory. Warner suggested that launching such a system would be best in connection with a large special event like the Ann Arbor Art Fairs.

Warner described ParkingCarma as a SPARK-incubated company. The company is listed on Ann Arbor SPARK’s website as a “portfolio company,” which refers to companies that “have navigated through the SPARK application and due diligence process and emerged with investments.” SPARK is a nonprofit organization that works on economic development for the Ann Arbor area.

Elizabeth Parkinson, vice president of marketing and communications for SPARK, told The Chronicle in a phone interview that ParkingCarma had gone through Phase I and Phase II of SPARK’s business accelerator, and had received a loan from the Michigan Pre-Seed Capital Fund, which is managed by SPARK’s Skip Simms, as well as from Automation Alley.

Granger and Christman Dispute Concrete Bid

The DDA board got an update on the progress on the underground parking garage currently under construction along Fifth Avenue on the city-owned Library Lot. The update was delivered by Pat Podges, who is vice president for southeast Michigan operations for The Christman Co., which is the construction manager for the job.

Key points of the update included the fact that earth-retention work had been completed on the east and south sides of the project and would be proceeding east to west along the north side of the site. Excavation was continuing along the east leg, near Division Street, Podges reported. A decision had been made to dewater the site by taking water up Liberty Street to South State Street, as opposed to running it to the west down toward the Allen Creek drains.

Podges reported that the result of the returned bids on the project meant that the estimate contingency in the contract would be returned in full, and the risk contingency on the project could be reduced, which resulted in $1 million that the DDA would be getting back.

Then Podges moved into a description of how the concrete package had been handled: “I just want to speak real briefly about the integrity of the process by which we used to establish the subcontractors which we are using on the job – specifically the structural concrete work package, which was the largest package on the project.”

Background on the Construction Contract

Selection of the construction manager for the underground parking garage was done in two steps. First, the job of pre-construction services was awarded. That company’s performance on pre-construction services would determine whether the DDA retained them as construction manager. The expectation was that whichever company was selected for pre-construction would ultimately be selected as construction manager.

The interviews for pre-construction services were described in part in an Aug. 13, 2009 Chronicle article. Stressed throughout the interviews was the idea that construction manager companies that could self-perform various sub-contracted aspects of the job – like pouring the substantial amount of concrete for the garage – would need to compete with other companies for that work. Describing how Barton Malow was not selected for the construction manager job, the article makes clear that Barton Malow could conceivably make money by winning the concrete portion of the job:

Still, Barton Malow and [Neal] Morton could make money on the job – if they’re selected as a concrete subcontractor. The construction manager candidates have their “in house” concrete divisions, and would ordinarily not need to subcontract out that work. But the DDA would like the construction manager for this project to bid out the concrete work. It was a question that DDA board member Leah Gunn put to the construction manager candidates during the interviews: Would they be comfortable having to compete for the concrete work with other bidders? The correct answer was yes.

The candidates for the job emphasized that the close quarters of the site made it a challenge – both logistically and in terms of minimizing impact on the immediately surrounding property. They’d be installing earth retention systems that would minimize vibration impacts, for example.

After performing to the DDA’s expectations in the pre-construction services phase of the project, Christman’s selection as construction manager of the project was finalized at the DDA board’s Nov. 4, 2009 meeting with a guaranteed maximum price of $44,381,573.

The sealed bids for the concrete work were opened on March 4, 2010 at the DDA offices. From Chronicle coverage of the DDA board’s March 3, 2010 meeting:

Bid package #3, [board chair Joan] Splitt reported, which is for the concrete and steel work, would be opened publicly at 2 p.m. in DDA offices the following day. [The bids will first be reviewed for numerical accuracy. Then any conditions specified by the contractors checked, and interviews will be held with the lowest three bidders to review the scope of work – a meeting for that is scheduled on Tues., March 9.]

The base bids were submitted as follows from lowest to highest:

1. $21,499,000  Granger Construction Company
2. $21,980,000  Colasanti Construction
3. $22,025,000  Christman Constructors, Inc.
4. $23,286,000  Spence Brothers Construction
5. $23,980,000  Barton Malow
6. $25,500,000  Walbridge

Note that Christman Constructors Inc. is a subsidiary of The Christman Co., which is the construction manager on the job. The post-bid meetings were held with the three lowest bidders, including  Christman and Granger. Granger’s team left the post-bid interview believing they’d won the job.

Pat Podges described at Wednesday’s board meeting why Granger was not awarded the concrete work. Here’s what Podges reported early in the meeting, after he updated the board on the construction progress :

I just want to speak real briefly about the integrity of the process by which we used to establish the subcontractors which we are using on the job – specifically the structural concrete work package, which was the largest package on the project. We received last month six bidders, that ranged anywhere from $21,449,000 to $25,500,000.

Based on the complexity of the project and the closeness of the second and third low bidder, we elected to bring in the three low bidders for post-bid reviews, which are widely used to determine their understanding of the project, their operational plan for the project, the schedule expectations, the quality and safety. At the end of that we disqualified the low-bidding contractor [Granger] for non-conformance with the bidding documents relative to the schedule and work plan, and also their ability to demonstrate to us their understanding of the operational execution of the work. That left the two remaining bidders, one of which was CCI, a subsidiary of the Christman Co. Each had submitted full documentation – work plan, management plan, and a detailed schedule for the project.

Further analysis of these two bids really revealed that the differential between the two firms was about 2/10 of one percent. We then looked at some other aspects of the work recommendation, including alternates that were required for them to provide as well as voluntary alternates which they offered at bid. And at the end, it was very clear that CCI had provided the best value for the project, and it was a team decision based on their final project cost, provided the best value to the city. In the end CCI’s price was $21,438,000, which was actually less than the original low-bidding contractor.

David Olson, vice president of Granger Construction, saw it differently from Podges. Speaking near the end of DDA board meeting during the time reserved for public comment, his remarks went as follows:

Hi, my name is David Olson, I’m vice president of Granger Construction. And I am here to talk briefly about integrity. As the low bidder of the concrete package on your parking ramp, I take exception to Mr. Podges’ comments about, I guess, our inexperience or lack of knowledge for that project. We’ve got a proven record of accomplishment for delivering these types of projects.

I’m here more just to make a simple public statement about a flawed process. And whether it is your process or their selection process. And make no mistake, this is not about sour grapes, this is about making a public statement about doing the right thing. We worked with these gentlemen for a long time in the same area – we play nice in the sandbox. It’s not about the gentlemen. It’s about the decision that the company made and whether it is their selection process or yours, you guys are complicit, and I just think it’s important to get this out in the public. We talk about money going back and forth – you guys are excited about $1 million that you get – if you go through that contract that’s money that is yours anyway, it’s due to be given back to you.

The process and how they made the selection of jumping from the low bidder, which we were, we won – over the second bidder to themselves, is kind of a shrewdly crafted shell game. I’m here to deliver a letter from our CEO Glenn Granger, which lays out the facts. We don’t expect to get this project, but we want to do the right thing. And doing the right thing is tough, it’s not easy being here today. It’s not about sour grapes – I was a little disarmed when we walked in and you [Leah Gunn] said, you know, ‘I know you’re here to whine about the project.’ We’re not here to whine. We’re here to get the facts on the record and to do the right thing. It’s not easy, but doing the right thing seldom is. So with that here’s a letter I would like to deliver to you, you can read it, certainly if you have any questions our contact information is there. We really appreciate your time. Thank you.

The letter delivered to the board members cited a lack of a rationale for rejecting the low-bidding company for the job. [Complete text of Granger's letter to the DDA] An excerpt:

None of Granger’s references were consulted, and there was absolutely no indication that Granger’s bid lacked a single project scope requirement. lf Christman had concerns, they had a duty to clearly document them in the meeting minutes and/or call us to communicate them. Regrettably, neither was done. The Ann Arbor DDA, and the taxpayers of Ann Arbor deserve the benefit of the lowest qualified bidder. Explaining the $526,000 difference became a shrewdly conducted shell-game, where The Christman Company extracted other savings out of the Guaranteed Maximum Price contract in order to make it appear that they’re serving your organization.

When Granger Construction interviewed for the construction manager’s role, the Ann Arbor DDA made it exceedingly clear that it desired openness, transparency and competitiveness. Unfortunately, that has not been the case.

Christman’s chief operating officer, Steve Frederickson, took the podium to respond to Olson:

Hi, I’m Steve Frederickson, president and COO of the Christman Company. I just want to be clear – I’m not sure what that letter says – but there’s been a lot of discussion that’s occurred over the past number of weeks relative to the award of the concrete package, and a lot of the discussion has been based on assumptions and conjecture and not on the facts. And so I just wanted to be really clear and really brief on what the facts are.

The facts are that in the bid documents, we described the complexity of this project. It’s underground, it’s cast-in-place concrete, you all know how hard this project is and the level of experience that is required to accomplish a feat such as that. But we were very clear in the documents about how we were going to award the project, and the criteria by which we would award the project: experience, detailed work plan, detailed schedule.

Price was part of it, but it says throughout the bid documents and in the pre-bid meeting that we had with all the bidders that it was not based exclusively on price, because we needed to know that we had a partner that was capable and qualified and knew the job, and put us in a position to be able to succeed as a partnership. The fact is, we were clear on the award criteria. Another fact is that the Granger Company was disqualified very early in the process unanimously by everybody at the post-bid [meeting], including the architect, the engineer, The Christman Company, your project management consultant [Park Avenue Consultants]. Those are the facts.

They didn’t comply with the requirements of the project, they did not display an understanding of the project to the level of comfort that we felt was necessary to be able to serve you and serve the project. Those are the facts. Their project manager had no underground parking deck experience – the full-time on-site project manager. So we were very clear on what the project was to be awarded based on. They did not meet that. So essentially what they have been asking for is a re-do of the process, and we can’t do that. It’s not fair to the other bidders to give one bidder a re-do – why wouldn’t we give the other bidders a re-do, based on what they submitted for a price? It’s unfair to the process.

We have challenged the integrity of the process, with our partners – with the architect, with the engineer, your project manager, with the DDA – and everybody has established hands down that the integrity of the process was maintained throughout the entire process. So we’re confident in that. And we’ve made those details available, and if you look at the details it’s very clear. So I just encourage you to look at facts, and take all of the emotion out of it, and look at the facts and the people that are best qualified to do the job. We’re in a great position to be giving that money back at this point, in moving forward through the project. Everybody’s excited to do it, we’ve got a great team, and we’re out there getting after it as you can see. Thank you.

Dennis Carignan, Granger’s director of pre-construction services, then took the podium:

I really don’t want to belabor this again – Steve [Frederickson] mentioned getting the facts out there. I would encourage you to do that, I would encourage you to look into the facts. You know, he mentioned not being qualified, and I can say personally I’ve been involved in two different parking ramp projects with Granger and we’ve done a dozen throughout the state and we’ve had huge success. And you guys know that – because we were short-listed to do the entire project [the construction manager job].

He also said, you know, that we weren’t compliant with the bid documents. And actually you can take a look at the post-bid interview, and we are compliant – there’s yeses all the way down. And it was kind of a shock to us to find out weeks later that they were going to bypass us. I’m glad to hear that you are saving money. In this economy, that is a big deal. And I think you could be saving more. I think there were some irregularities in the bidding process, that maybe you could have capitalized on some additional savings.

It was an extremely short bid period, you know. Maybe that was a way of ensuring that Christman could get the work. Voluntary alternates were prohibited, and I have never seen that in a set of bid documents. Now, to me, why wouldn’t you want to encourage some ingenuity and get some cost savings there? In fact, we’ve got $300,000 worth of savings to the job that we couldn’t submit on. And I’m happy to share that with you, too. To help the project maybe save more money. Aside from that, you know, I don’t expect anything to change. Again we just want to encourage the facts to come out.

The document referred to by Carignan with all the yeses checked is the post-bid conference summary, which is signed by representatives of Granger and Christman. In addition to the check boxes, the summary contains additional handwritten notations in free response fields. [.pdf of post-bid interview summary]

The language of the contract between Christman and the DDA supports Olson’s contention that the $1 million being returned by Christman to the DDA is contractually required [.pdf of complete contract]:

Upon Substantial Completion of the Project, any unused portion of the GMP [guaranteed maximum price] Estimate Contingency shall be returned to Owner [DDA] for use by Owner as determined by Owner in its sole discretion. Upon the release or return of any portion of the GMP Estimate Contingency to the Owner, the GMP shall be reduced by the amount returned or otherwise released to Owner from said fund.

The contract also specifies that Christman is paid only based on documented invoices for work actually performed – up to the guaranteed maximum price.

In a telephone interview, we asked Podges if he could provide some additional clarity  about the reason that Granger’s bid was rejected after the post-bid conference. Podges said it was not a question of Granger’s general qualifications to do concrete work for parking decks. Rather, it was Granger’s readiness – as reflected in the bid documents and the post-bid conference – to handle the detailed complexity of this specific underground project, with the associated logistical challenges of a tight urban construction site with little or no staging areas for materials.

Podges told The Chronicle that precisely because Granger is known as a competent firm, Christman was disappointed that Granger did not present the kind of detailed scheduling with specific construction activities and an operational plan necessary to give Christman the comfort level they need to award the job to them. Asked to give a specific example, Podges described how the timing of the form-pour sequence for shear walls – walls interior to the structure – was crucial. But when asked for their thoughts on how they’d approach that, Podges said, Granger didn’t provide a detailed answer.

A lot of what Christman knows about building underground parking structures, Podges said, stems from their recent experience on the Michigan Street Development Project in Grand Rapids. Podges said that meant his firm had expertise and experience that allowed them to understand the challenges in more detail than others. The Michigan Street Development Project was a key part of Christman’s presentation to the DDA board when they interviewed for the construction manager job. [Chronicle coverage: "DDA Hires Christman, Bonds Delivered"]

Perspective on Self-Performed Work

Two factors may have led observers of the bidding process to the erroneous conclusion that the concrete work for the DDA’s parking structure was required to go to the lowest bidder. First, the questioning during the construction manager interviews held by the DDA emphasized that the construction manager’s in-house divisions would have to compete with other bidders. Second, the public opening of the sealed bids is often associated with a low-bid requirement.

Christman’s contract, however, specifies a guaranteed maximum price. That’s an arrangement that requires Christman to accept a certain amount of risk – if the cost is more than the maximum, it comes out of Christman’s pocket. In such an arrangement, the final determination of subcontractor selection belongs to Christman.

DDA staff capability does not extend to providing direct oversight of Christman’s selection process for subcontractors – that’s something for which the DDA relies on its construction consultant, Park Avenue Consultants, and the architect on the project, Luckenbach Ziegelman Architects.

In the course of recent reporting on the Humane Society shelter construction project, for which Washtenaw County is providing a certain level of oversight, The Chronicle met Bob Martel, who’s playing the role of construction manager for the shelter project, which is essentially now complete. Martel’s specific expertise is as an owner’s representative for development of medical office building projects in the $15 million to $30 million price range.

So we asked Martel for his thoughts on the general idea of arrangements in which a construction manager has the option of self-performing the work. In a phone interview, Martel said that he favored a practice specifying that a company performing as construction manager for a job could not self-perform any of the subcontracted work.

His rationale behind that, explained Martel, was to remove any possible perception that the construction manager’s in-house division might have an inside track, which could dissuade other companies from bidding. That could lead to a situation where the owner’s price wasn’t as low as it could be.

But Martel allowed that his own approach was not the most common practice. He also added that he’d hired Christman for a couple of projects – they’d done great work, he said.

DDA Board View on the Concrete Bids

At the very end of the board meeting after representatives from Granger and from Christman had all weighed in, John Splitt addressed the issue this way:

I just want to say at this point that as chair of the capital improvements committee and as chair of this board I am satisfied with the integrity of the process that went on. And I think that the committee all agrees that the process was fair.

Misc. Items Discussed by the DDA Board

There were a range of other topics mentioned at Wednesday’s meeting.

Main Street BIZ

In other public commentary before the board, Ed Shaffran appeared in order to thank the board for their support in the establishment of the Main Street Business Improvement Zone. Ellie Serras had been listed on the agenda to speak on behalf of the BIZ, so when Shaffran took the podium, he joked that he figured they’d prefer to hear from Serras, which was met with an enthusiastically lighthearted “Yes, we would!” from Leah Gunn and Russ Collins.

The DDA had provided $83,270 to support the creation of a business improvement zone (BIZ) on South Main Street.

Sandwich Board Signs

At the city council’s Feb. 16, 2010 meeting, a revision to the city sign ordinance was unanimously defeated – it would have legalized the common practice of using sandwich board signs on downtown sidewalks. The measure also did not enjoy the support of its sponsor, Sabra Briere (Ward 1), who had worked with a task force established in October 2009 to address the issue.

At the February meeting, it was indicated that the city attorney was recommending that the ordinance be enforced. Warnings have been issued but no confirmed citations have been made. There is some sentiment among merchants that the sandwich board signs could be subsumed under the sidewalk occupancy ordinance.

At Wednesday’s board meeting, Keith Orr gave his colleagues a rundown of the history of the issue. Newcombe Clark emphasized that it was crucial for non-first-floor businesses to get the added exposure that could be gained from sandwich board signs.

Before the DDA board was a resolution calling the city council to take action at its next meeting, on April 19, 2010, to legalize sandwich board signs.

Outcome: The DDA board unanimously passed the resolution that called on the city council to revise the ordinance in a way to make sandwich boards legal downtown.

East West Rail

During public commentary at the conclusion of the meeting, local developer Peter Allen said he was troubled to learn from reading the minutes of the DDA board’s retreat that the east-west rail project had been put on hold. He said he felt like the DDA could play a role by stepping up and being a leader on the issue, by standing up and shouting, “It has to get done.” He also pointed to the University of Michigan as an organization that stood a lot to lose, if the project didn’t move forward.

Mayor John Hieftje responded to Allen’s remarks by saying that there was still a whole lot going on and that the recent setback had to do with the failure to win stimulus funds to address siding issues near Detroit. When that was worked out, he said, the project would be back full-bore. He noted that rail cars are being purchased, so the project is still going forward.

Hieftje also said that conversations with Dearborn were happening and that there was some possibility of exploring a connection that would include Dearborn and the airport, but that would not go all the way to Detroit initially. He pointed to the $30 million of stimulus funding that Dearborn had been awarded in order to build a new station.

Commuter Challenge: getDowntown

Nancy Shore, director of the getDowntown program, reported to the board that the commuter challenge, which takes place in May every year, could use support from their participation. Just one sustainable commute, she told them, would earn a free ice cream from Washtenaw Dairy. The Bike to Work Day event for this year will fall on May 21.

Present: Gary Boren, Newcombe Clark, Roger Hewitt, John Hieftje, John Splitt, Sandi Smith, Leah Gunn, Russ Collins, Keith Orr, Joan Lowenstein, John Mouat

Absent: Jennifer S. Hall

Next board meeting: Noon on Wednesday, May 5, 2010 at the DDA offices, 150 S. Fifth Ave., Suite 301. [confirm date]

Ann Arbor parking meters are currently enforced from 8 a.m. to 6 p.m., Monday-Saturday. (Photo by the writer.)

Key elements of the draft resolution that Smith shared with fellow DDA board members included: (i) net revenues from the Fifth and William (old YMCA) lot would go into city rather than DDA coffers, (ii) downtown parking meters would operate and be enforced until 10 p.m., which is later than their current cutoff of 6 p.m., and (iii) the city would discontinue its plan to install its own parking meters in neighborhoods near the downtown.

The city’s plan to install its own parking meters in neighborhoods near downtown was formulated as part of the city’s FY 2010 budget (the current fiscal year), but implementation was not immediate. Reference to the city’s installation of “its own meters” alludes to the fact that the DDA manages the public parking system via an agreement with the city – the new meters would not fall under that agreement.

Although the specific wording of the draft differed in parts from the resolution that was added to council’s agenda on Friday, the key points remained.

Within hours of its appearance on the agenda, the Ann Arbor Area Chamber of Commerce had sent a memo to city councilmembers asking for postponement of the resolution.

Smith’s resolution puts one question that’s been simmering for nearly a year closer to the front burner: Will the parking agreement between the city and the DDA be renegotiated as part of the FY 2011 budget?

FY 2010 Adopted Budget, FY 2011 Budget Plan

The city of Ann Arbor plans budgets in two-year cycles, though it formally adopts budgets only one year at a time.  When the city council adopted the FY 2010 budget in May 2009, that was the first year of a two-year plan, which included FY 2011 as the second year. The city’s fiscal years run from July 1 through June 30 – FY 2011 begins on July 1, 2010.

The FY 2010-2011 city budget planning cycle included parking and the Downtown Development Authority in two significant ways.

The FY 2010 adopted budget included an assumption of $380,000 in additional annual revenues per year through the installation of parking meters by the city in areas outside the DDA district. [.PDF file of the DDA district boundaries]

The FY 2011 budget plan included an assumption that the parking agreement between the city and the DDA could be renegotiated to result in a $2 million payment by the DDA to the city, which the DDA is not compelled by the current agreement to make. That agreement, struck in 2005, called for the DDA to pay the city up to $10 million through 2015 – the DDA has made payments of $2 million in each of the first five years of the agreement, for a total of $10 million.

Since January 2009 , there’s been political jostling on the side of the city council and the DDA board on the question of the parking agreement, but no actual discussions between the two bodies through their respective “mutually beneficial” committees.

On the question of parking meter installation, the DDA  has expressed skepticism about the amount of revenue those meters could generate. [Chronicle coverage: "DDA to City on Meters: We're Skeptical"] Sandi Smith (Ward 1) has, since June 2009, worked on the city council to delay the installation of the meters until alternative revenue sources could be identified to replace the $380,000 the city expected to collect from the new meters.

Before summarizing the discussion at the DDA operations committee on Wednesday, we provide two separate timeline overviews: (i) the political jostling on the city-DDA parking agreement, and (ii) the city council actions on installation of additional parking meters outside the DDA district.

History of the Mutually Beneficial Committees

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• Jan. 20, 2009: City council passes a resolution asking the DDA to begin discussions of renegotiating the parking agreement between the city and the DDA in a mutually beneficial way.
• March 4, 2009: DDA board establishes a “mutually beneficial” committee to begin discussions of the parking agreement between the city and the DDA. On the committee: Roger Hewitt, Gary Boren, Jennifer S. Hall, and Rene Greff. The DDA’s resolution establishing their committee calls on the city council to form its own committee.
• May 20, 2009: During the mid-year DDA retreat, mayor John Hieftje states publicly that city councilmembers object to Jennifer S. Hall and Rene Greff’s membership on the DDA’s “mutually beneficial” committee.
• June 3, 2009: DDA board chair Jennifer S. Hall removes herself from DDA’s “mutually beneficial” committee, replacing herself with Russ Collins.
• June 15, 2009: Mayor John Hieftje nominates councilmembers Margie Teall (Ward 4), Leigh Greden (Ward 3) and Carsten Hohnke (Ward 5) to serve on the city council’s “mutually beneficial” committee, and they’re confirmed at the city council’s July 20 meeting.
• July 1, 2009: DDA board chair Jennifer S. Hall appoints Sandi Smith to replace outgoing DDA board member Rene Greff (whose position is filled with Newcombe Clark) on the DDA’s “mutually beneficial” committee. Smith is also a city councilmember, representing Ward 1.
• August-December 2009: Sandi Smith, the chair of the DDA’s “mutually beneficial” committee, reports at each monthly DDA board meeting that there is nothing new to report.
• Dec. 5, 2009: Dissolution of the DDA is included in an “everything is on the table” list for discussion at the city council’s budget retreat.

[For background on the tax-increment financing that funds the DDA and the political tension between the city and the DDA, see previous Chronicle coverage: DDA Retreat: Who's on the Committee]

History of FY 2010 Parking Meter Installation

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• May 18, 2009: City council adopts its FY 2010 budget, which includes an assumption of $380,000 in revenue from installation of parking meters in near-downtown neighborhoods.
• June 15, 2009: City council passes a resolution authorizing only a limited implementation of parking meters in a limited number of new locations, with an Oct. 5 deadline for development of an alternative revenue plan.
• June 15, 2009: City council passes a resolution that redefines the parking rate and revenue deal between the city and DDA on the 415 W. Washington parking lot (which was not covered in the general city-DDA parking agreement) in favor of the city. Annual net to the city is projected to be $164,000.
• July 1, 2009: DDA approves, with dissent, its side of the 415 W. Washington parking lot deal.
• Oct. 5, 2009: City council extends a moratorium on installing additional parking meters to Dec. 14.
• Nov. 16, 2009: City council separates consent agenda item to purchase parking meters for $87,000 and postpones that action.
• Dec. 7, 2009: City council again postpones action on the purchase of parking meters for $87,000.
• Dec. 21, 2009: City council to consider action on purchasing parking meters for $87,000, along with Smith’s separate resolution addressing Fifth & William lot revenues and extending meter operation and enforcement to 10 p.m.

Discussion at DDA Operations Committee

At last Wednesday’s DDA meeting, Sandi Smith apprised her DDA board colleagues of the resolution she intended to place on the council’s agenda that would have the effect of forestalling permanently the city’s plan to install its own parking meters outside the DDA district. The resolution would also extend the hours of operation and enforcement for downtown meters.

Revenue Replacement: Fifth and William Lot

The revenue replacement for those outside-the-DDA-district meters would come from proceeds of what is now the surface parking lot at Fifth and William, known as the “old Y” site. That surface lot, created relatively recently, is not envisioned long-term for parking. It’s slated for redevelopment.

In that respect, the Fifth and William lot is similar to the surface lot at 415 W. Washington, which was also converted to surface parking, pending planned redevelopment of the site. Both lots are thus considered temporary, and are not covered explicitly in the 2005 parking agreement between the city and the DDA.

As the previous timeline indicates, in the summer of 2009, proceeds from the 415 W. Washington lot were renegotiated in favor of the city, as a part of Smith’s effort to replace the revenue estimated by the city from installation of additional meters in near-downtown neighborhoods.

With the closure of the Fifth Avenue “Library Lot” for surface parking – because of construction starting on the underground parking garage at that location – use of the nearby Fifth and William surface lot has jumped dramatically. In October 2009, the lot generated $26,742 in revenue, compared with only $8,659 in October 2008.

Not all of the estimated $300,000 in annual revenue from the Fifth and William lot would go to the city of Ann Arbor – the DDA would be fully reimbursed for installation costs. Those installation costs would include items like the paving of the lot and the parking gates and payment kiosk, but not the demolition of the old YMCA building that previously stood on the lot or the environmental remediation that was required. DDA executive director Susan Pollay told The Chronicle in a phone conversation Friday that the DDA spent roughly $1.5 million on demolition and asbestos abatement at that site.

At the DDA operations committee on Wednesday, Newcombe Clark expressed some similar concerns about the proposed deal to those that Rene Greff had expressed earlier in the year about the 415 W. Washington deal. [See Chronicle coverage on: "Split DDA Board Agrees on Splitt"] Clark was appointed to replace Greff on the board, when her term expired at the end of July 2009.

Clark was concerned that what was proposed was not transparent – the deal was a mechanism to transfer money from the DDA to the city, which was more appropriately an issue for the two “mutually beneficial” committees to explore. “It creeps into the ‘mutually beneficial’ committee’s responsibility,” he said. “If the city needs money, do it transparently.”

Clark said he feared that there would be perhaps seven or eight smaller deals done before the “mutually beneficial” committees ever met.

Smith responded to Clark by saying, “It’s wishful thinking that anything will happen at a meeting between the committees that is really mutually beneficial.”

As far as whether it was transparent what the proposal meant, Smith said, “It’s clear – it says, ‘Back off the installation of new parking meters!’”

Also focusing on the aspect of the proposal that put a stop to the city’s planned installation of new parking meters, Pollay pointed out that the DDA’s strategy in responding to the city had been to express its skepticism about the projected revenue that the new meters would generate, rather than to contest the city’s authority to install the meters.

The supporting material for Smith’s upcoming council resolution on parking alludes to the fact that there is only one public parking system in Ann Arbor, and that the DDA, per its parking agreement with the city, has authority over it. That material reads, in relevant part, [underlining in the original]: “The DDA/City Parking Agreement states that the DDA shall have uninterrupted operation of the public parking system …”

Extension of Meter Operation Hours

Smith’s resolution also includes the extension of meter operation and enforcement to 10 p.m. – meters are currently not enforced past 6 p.m.

The rationale for extending meter enforcement is the complaint that downtown retail/restaurant employees use the free street parking after 6 p.m., which is counter to the goal of promoting turnover of vehicles to allow customers of the downtown to use the spaces.

There’s resistance to the extension of meter enforcement by downtown merchants; there was also vocal resistance to  the city’s intended installation of parking meters in near-downtown neighborhoods by residents of those neighborhoods.

Smith’s resolution is part of her continuing effort to forestall the city’s meter installation, which could be analyzed as an effort to address concerns of near-downtown residents. So, at the operations committee meeting, Clark questioned whether Smith – by proposing extension of meter enforcement hours – was simply afraid of “getting yelled at” by residents of neighborhoods.

At that, DDA board member (and county commissioner) Leah Gunn gave Clark a poke back, by asking if Clark was afraid of getting yelled at by Main Street merchants. [Clark is president of the Main Street Area Association board.] Gunn herself said she supported the extension of meter enforcement.

With a detectable weariness in her voice, Smith assured her DDA board colleagues that she was getting yelled at by everyone.

Next Steps: Postponement? Committee Meetings?

If the city council listens to the Ann Arbor Area Chamber of Commerce, they’ll postpone consideration of Sandi Smith’s (Ward 1) resolution on parking. Within hours of its appearance on the online council agenda, an emailed response to councilmembers came from Kyle Mazurek, the chamber’s vice president of government affairs:

Dear Ann Arbor City Council Members,

I am writing in regard to the attached document entitled “Resolution Regarding New Parking Meters.” Presumably you will take action on this resolution on the evening of Monday, December 21.

Given that it’s now the holiday season and many are traveling, and given that this resolution was not uploaded to the City’s website until today (Friday) at 11:57 a.m., the Ann Arbor Chamber respectfully requests that you postpone consideration of this matter to a later date.

All interested parties should be given sufficient time and opportunity to examine it. Its implications for the downtown area business community should not be taken lightly.

This Council clearly values public input. For consistency and fairness sake, let’s not now stymie it by hastily considering this matter.

Respectfully,

Kyle Mazurek

While the exact text of the resolution was not finalized until Friday, Smith has indicated to her council colleagues at the last two council meetings that she would be bringing forward a resolution on parking. That has been the basis of her request to her council colleagues to postpone consideration of the purchase of parking meters for installation on Wall Street – a request they’ve respected twice now.

If and when the two “mutually beneficial” committees from the DDA and the city council meet, it’s reasonable to expect that the meetings will be open to the public and announced in accordance with the Open Meetings Act.

While the committee membership from the city council would not amount to a quorum, a resolution passed at its Nov. 4, 1991 meeting by the Ann Arbor city council expresses the council’s will that its committees adhere, to the best of its abilities, with the requirements of the OMA:

R-642-11-91

RESOLUTION REGARDING OPEN MEETINGS FOR CITY
COMMITTEES, COMMISSIONS, BOARDS AND TASK FORCES

Whereas, The City Council desires that all meetings of City boards, task forces, commissions and committees conform to the spirit of the Open Meetings Act;

RESOLVED, That all City boards, task forces, commissions, committees and their
subcommittees hold their meetings open to the public to the best of their abilities in the spirit of Section 3 of the Open Meetings Act; and

RESOLVED, That closed meetings of such bodies be held only under situations
where a closed meeting would be authorized in the spirit of the Open Meetings Act.