The Ann Arbor Public Schools board at its June 15, 2012 meeting.

That budget reflects roughly $4 million in spending cuts compared to last year’s budget, and reflects the elimination or restructuring of some transportation services, a reduction in the budget for substitute teachers, and the consolidation of high school summer school programs.

The approved budget also calls for using $6.54 million, or about one-third, of the district’s current fund equity, which caused trustee Christine Stead to cast her vote against the budget. Stead expressed strong concern that the budget neither allows for incremental expenditure shifts, nor sets the district up for successfully weathering the 2013-14 budget cycle and beyond. “I want us to use our past year’s experience as a data point,” she said, “… [T]o act like we are, with the information we have, is difficult for me to support.”

The June 13 meeting also saw the approval of three special briefing items – a renewal of the district’s food service contract with Chartwells, a resolution to upgrade human resources and finance software, and a set of policy revisions. Special briefing items are reviewed and voted on by the board in a single meeting instead of being entertained as first and second briefing items at two consecutive regular meetings.

Finally, the board approved the contract of Robyne Thompson as the new assistant superintendent of secondary education, and extended the contract held with AFSCME Local 1182, which primarily represents custodians and maintenance workers in the district.

2012-13 Budget

The formal adoption of the 2012-13 budget  was the main item on the board’s agenda.

Budget: Public Commentary

There were eight speakers during public commentary. Seven spoke about the district’s current plan to keep Roberto Clemente Student Development Center open for the next year, but to evaluate its effectiveness (as the board had previously weighed the option of consolidating or closing alternative high schools, including Clemente) and one spoke about busing reductions at Bryant and Pattengill.

Barbara Malcolm asked: “How do we citizens hold the school board accountable?” She argued that the board is “allowing those with no vested interest in this community come in and make you appear incompetent.” She called the arrogance displayed by the school board deplorable and questioned whether the board was so disconnected that it does not know what is going on in the community. “We have to get those who are not truly concerned about education for all students out of here,” Malcolm said.

Malcolm pointed out that the cost savings for closing the Clemente summer school might be lower than hoped – given that Clemente summer school staff members were hired by the district-wide summer school program at Pioneer High School instead of absorbing the Clemente students into the district-wide program without any adding additional staff.  She also noted that the board still has to pay for busing to the program. She also contended that a partnership with Ypsilanti has led Clemente to add $150,000 in revenues to the district, which the AAPS board has not acknowledged, she said. Malcolm noted that Green had attended the recent African-American festival, saying, “We are happy you came…, but don’t just come for the fun stuff – that’s a slap in the face.” Finally, she asserted that it seems like some board members are supporting personal agendas in their board work.

Clemente parent Kathleen Ardon disputed a contention that there had not been an evaluation done of Clemente earlier, saying an evaluation had been done under former AAPS superintendent Richard Benjamin in the 1980s, and the program had been deemed exemplary. Ardon said it bothers her that the board does not want to consider the GPA of Clemente students as a measure of success, and also noted Clemente was not “given credit” the money it brings in by enrolling students from Ypsilanti. She thanked the board for waiting to restructure Clemente, but said it was too little too late, and contended that the board has alienated Clemente principal Ben Edmondson.

Clemente graduate Nicholas Morton said he will be proud to come back to talk to the students at Clemente after attending college. He recited the Clemente creed, and noted how Edmondson holds all students to his high expectations. “There is a school for everyone, Morton argued, and [Clemente] is the school for us.”

Charlae Davis said she sat and cringed at the last board meeting when the Clemente summer school was presented as an orientation program. She said the program is 110% academically rigorous, and addresses what scholars say will diminish the achievement gap. As an educator, Davis said, she does not understand why the summer school program would be consolidated with the district-wide summer school at Pioneer. She called it a “lose-lose” situation for students who have to choose between attending summer school at Pioneer or not attending at all.

Like others, Davis noted that Clemente brings in over $150,000 in School of Choice revenue from Ypsilanti students, and questioned why that was not included in the cost savings calculations. Davis continued, saying that, “…power, oppression, intimidation, and professional bullying have no place in the school board, or superintendent’s cabinet. Please stop trying to push your own agendas – you have already received your education.”

Tia Jones said she is truly bothered that Clemente does not have a summer school program for the first time since 1974. It is not orientation, she said, but a “home” for students over the summer. “We want to be with our family and not with some strangers,” Jones asserted.

Jeanne Rivers, daughter of former U.S. Congresswoman Lynn Rivers and Clemente graduate from 1998, noted that she actually graduated early because of the summer school program at Clemente. She said it’s sad that Clemente could be closed. “We [in Ann Arbor] claim we’re not racist,” Rivers said. “I just don’t see how we are going to succeed as a city if we allow this one little school to just be dismissed and dismembered,” noting that Clemente students are not welcome in the comprehensive high schools. “Please don’t take this away from these kids,” she urged the board. “This is some of these kids’ only chance.”

Monique Hardeman urged the board to remember that we were all children at one time, and pointed out that different children have different needs. She noted that AAPS has had three alternative high schools for her whole life—A2Tech (formerly Stone School), Community, and Clemente, and that they are all part of the Ann Arbor community, and serve different groups of students. She pointed out that Clemente is not just a school for African-Americans, but that she has noticed students of many different cultures there. “Everybody there is loving and getting along well,” Hardeman said. “Before you cut any school, think about how it will affect those children.”

Patty Kracht addressed the board regarding busing changes at Bryant and Pattengill. She noted that the board has said Bryant-Pattengill parents have requested this change, but in fact, parents feel “like we have been steamrolled with this plan.” She noted that the combination of routes between the two schools will cause some of the district’s youngest students to be on a bus for 45-50 minutes at the end of the day. Two hundred four to seven-year-olds at Bryant will be “corralled in a gym” for 18 minutes before school with only two to four teaching assistants looking after them, Kracht pointed out. She added that she was disheartened by her experience on the newly formed committee on this issue, and that it was obvious that parents’ ideas and information would be dismissed.

Superintendent Patricia Green introduced the second and final briefing of the 2012-13 budget proposal by saying that the creation of the budget had been a long process, and that the administration knew it was going to be a very difficult cycle. The budget reductions that are part of the proposal are designed to keep the cuts out of classroom as much as possible, Green said, but she acknowledged the “great losses” experienced by the AAPS community as the district goes through its sixth year of significant budget reductions. “There is not a person who works for this school district who feels good about what we are about to request this evening, but we still need to be responsible in this decision-making,” she said.

Budget: Base Expenditure and Revenue Projections

Deputy superintendent of operations Robert Allen reported that since the board’s May 23, 2012 meeting, he had made a $1 million adjustment to projected base expenditures based on additional cost savings from the district’s self-insured portion of health insurance offerings. Allen explained that fewer employees are now on the self-insured plan, so the risk is lower than in past years. He pointed out that this will mean the 2012-13 budget as presented will use $6 million of fund equity, not the $7 million discussed at the previous meeting.

Trustee Glenn Nelson said he is very pleased with the hard work that led to the $1 million savings in health care, but questioned the district’s assumptions about the amount AAPS would receive from the state’s School Aid Fund now that the state had passed the 2012-13 school aid bill. Nelson said that if the house fiscal agency is correct, AAPS will receive $700,000 less than the district projected.

Allen responded that based on the latest information, the MPSERS (Michigan Public School Employees Retirement System) offset will be $2.2 million, the best practices incentive will be $900,000, the performance incentive dropped to $700,000, and School of Choice revenue stayed constant at $1.2 million. He agreed with Nelson’s assessment that the district will receive less in school aid than anticipated, but said he did not adjust the budget to reflect that because of other factors that could affect the budget positively, such as the state’s proposed retirement reform legislation, and the excess TIF capture by the Scio Township Downtown Development Authority (DDA). [The Ann Arbor DDA does not capture any of the AAPS millage; however the Scio DDA does. And each year, the Scio DDA returns to taxing jurisdictions – like the AAPS – whatever amount it does not use in the service of its TIF plan.]

Stead added that the MPSERS rate will likely increase, but Allen pointed out that some versions of the retirement reform legislation cap the rate, and would the state picking up the remainder of the cost.

The bulk of the board’s discussion on the budget centered on the use of the $1 million base adjustment made by Allen since the first briefing, and the public hearing on the budget, held at the board’s May 23 meeting.

Budget: Use of the $1 Million Base Adjustment

Thomas suggested revisiting the cuts to four FTEs (full-time equivalent positions) in counseling staff. As of the first briefing on the budget, Thomas pointed out, the board was prepared to spend $7 million in fund equity, but now must tap the fund reserves for $6 million. He asked Green what her priority would be if she had a magic wand, and could resurrect one item from being cut.

Green responded that if there were additional funds available, she would assign the highest priority to three items: counseling staff; the departmental budgets; and the school improvement funds. She noted that these three items directly impact the work on social and emotional learning that she is spearheading in the district.

Nelson, Lightfoot, and Patalan supported Thomas’ suggestion to restore the counseling positions.

Nelson argued that there was urgency to restoring funding for the counseling positions due to the timing of the hiring process. Green agreed, but said that while she stands by her administration’s budget recommendation, she also feel strongly about the role of counselors as critical to the work of the district going forward. Nelson also suggested that if the board agreed to renew more funding than the amount needed for the counseling positions, the administration could split it between reinstating the departmental budgets which are used to deliver professional development and giving money back to the school improvement teams.

Lightfoot said she was amenable to reconsidering the counseling cuts, and that she had several concerns, including how the placement of the remaining counselors would be made by human resources, and how the counseling reductions would impact the neediest students.

Patalan said restoring the school improvement team funding resonated with her, and that the departmental budgets are used to improve what goes on in the classroom for kids. Counseling also affects large numbers of students, she said, and is really very important. Patalan said that while she is nervous about the future of state funding, she is supportive and appreciative of the hard work that Green and her administration have done, and that she is “intrigued” by the possibility of using some of the “found chunk of money” to restore Green’s priority items, and saving some of it. She pointed out that three weeks ago, the board was ready to spend all of this money out of fund equity.

Stead said this discussion made her think of the budgeting experience the district had last year, when not all of the approved reductions could be implemented. She expected the district to face the same situation this year. She said budgeting was not a “perfect science,” but expressed concern that the board was not allowing for some opportunity to experience incremental increased costs. She pointed out that AAPS will not likely be adding much to fund equity in coming years, school aid fund revenue could decrease, fund equity needs to be maintained to manage summer payroll, and special education funding is expected to decrease by almost $3 million.

Stead encouraged the public to “employ common sense” when reading about the district’s budget, and noted that “one of the things [she] saw in anonymous comments on a local media site” is an argument that AAPS is projecting a 5% revenue increase. She pointed out that, in fact, revenue is projected to decrease, and added that the district’s per-pupil funding would be more than $12,000 per student if it had kept up with inflation. [The district’s current per-pupil allocation is $9,020.] Stead said she would be inclined to support putting anything back on the table if the district were in a different situation. “I want us to use our past year’s experience as a data point,” she said, “…[T]o act like we are, with the information we have, is difficult for me to support.”

Mexicotte took issue with the use of the term “found money,” which she said “makes it sound like it fell out of the sky.” She argued that it was due to the conservative work of AAPS administration that it was not included at first, and said that adjustments are to be expected. “What we think will work best, not what we want to do, is here on the table,” she said.

Referring to public commentary made at the beginning of the meeting which argued that board members were motivated by personal agendas, Mexicotte also asserted that “there are no personal agenda around these budget items. The agenda is to try to maintain public education in Ann Arbor. We disagree on how to get there… The only thing that is personal is how painful it is.”

Mexicotte said she agreed that the board has to look forward, but argued that putting some money back into the budget will “neither save us nor doom us,” but may allow some of the critical changes proposed by Green to “see some momentum.” Mexicotte later proposed a friendly amendment which restored $500,000 of funding for use by Green to fund some portion of her priority items – counseling staff, departmental budgets, and school improvement team budgets – at Green’s discretion.

Intermediate outcome: The board accepted Mexicotte’s amendment as “friendly” – that is, without requiring a separate vote on the amendment – to restore $500,000 of funding for Green’s priority items. That resulted in a planned use of $6.5 million from the fund balance reserve, instead of $6 million as the budget was previously briefed.

Budget: 4 p.m. Middle School Busing

Nelson asked for an update on the current status of the late bus serving the district’s five middle schools. Green said the budget still includes a reduction to eliminate those buses, but that the district has asked two organizations to help with funding them. At this time, Green said, the PTO Thrift Shop has agreed to pay for half of the cost to keep those buses running, and the AAPS educational foundation (AAPSEF) has been approached to ask if they would consider funding the othe half.

Patalan said that she is absolutely grateful that the PTO thrift shop and the AAPSEF might be able to help with middle school busing costs, and said it speaks to the “fabulous community we are all a part of.” Green added that she, along with Nelson, sits on the board of the AAPSEF, and that she would be remiss if she didn’t remind people that the AAPSEF is in the midst of its Million Reasons campaign.

Intermediate outcome: The late bus discussion did not lead to any revisions to the budget.

Budget Bryant-Pattengill Busing

Thomas asked for an update on the Bryant-Pattengill busing plan. Green said that combining routes to the two schools will eliminate the need for some runs, and will allow students from the same family to take the same bus. She said the goal was to eliminate as many stops as possible, accepting the fact that adding more students to each bus at the remaining stops means the busses will fill up faster. Green also said that AAPS requested WISD transportation services to do some dry runs to see how the proposed times line up with actual times needed to complete each route. Green reported that the dry run times were within a minute or two of the projected times.

Allen added that the numbers used in the proposal are for current riders, but pointed out that 5-10% of the routes are usually adjusted every year when current ridership numbers are established.

Thomas pointed out that the board’s budget vote does not commit the administration to specific plans for enacting each and every one of the reductions the budget contains, and that the transportation plan may end up different from what has been presented so far.

Intermediate outcome: The discussion of Bryant-Pattengill busing did not lead to any revisions to the budget.

Middle School Athletics

Regarding the proposed $37,000 reduction of middle school athletic directors, Allen said that alternative approaches to reaching the same cost savings in middle school athletics are still being considered, but at this time no changes to the proposed reduction have been agreed on. Green added that the proposal crafted by the middle school athletics directors could have “ripple effects” on another group, and that it would need to be fleshed out it more detail to be approved. “There is the beginning of the workings of possibly being close to that,” she said.

Intermediate outcome: The discussion of middle school athletics did not lead to any revisions to the budget.

Lightfoot said she was encouraged that staff had been enlisted to help shape the budget, and that she would like to see more of that. Stead said she had faith in the administration that the details would get hammered out. Green responded that she has asked her executive cabinet to develop preliminary action plans for enacting the budget so that those plans are ready to be vetted by the full cabinet as soon as the budget is approved by the board.

Outcome on budget: The budget as amended ($500,000 restored, using fund balance) was passed by a vote of 5 to 1. Mexicotte, Nelson, Patalan, Thomas, and Lightfoot voted yes. Stead voted no. Baskett was not present at the June 13 meeting. The millage resolution supporting the budget was also approved at the June 13 meeting; this includes four millages – a homestead millage at 4.7084 mills, a non-homestead millage at 18 mills, a debt service millage at 2.45 mills, and a sinking fund millage at 1 mill.

Food Service Contract Renewal

Green introduced the contract renewal to the board, saying that this was an opportunity for them to ask questions about the program, now in its third year in the district. AAPS director of purchasing, grants, and business support services Linda Doernte said that this was the third renewal of a five-year contract, and that the contract has not changed much. Doernte did note that Chartwells’ administration and management fees have increased based on the consumer price index. She also said AAPS has been receiving checks from Chartwells honoring the guaranteed minimum $500,000 that is owed to AAPS, regardless of the revenue that the program generates.

Chartwells new district manager Ann Smith and new food service director Heather Holland introduced themselves to the board, and gave a brief presentation on the food service provided this year. Holland said Chartwells has seen a 3% increase in lunches served in the district this year, and attributed that success to the introduction of new programs, and to creating an environment in which students enjoy the dining experience. She also noted the success of Chef Neil going to all the middle schools and teaching students how to create yogurt parfaits.

Holland said that students have been excited by the improved look of the service area, and the transformation of the food service setting from an “institutional look” to more of a “restaurant look.” She also noted that fresh fruits and vegetables are served at all schools four days a week from September through November, and that the overall menu is phasing out trans fats, decreasing sodium, and increasing whole grains.

Holland also reported that, effective 2012-13, the USDA will require that students select a fruit or vegetable for their meal to be reimbursable through the federal school lunch program (for students who qualify for the free or reduced lunch program), or for students to qualify for the lower “meal rate.” Students who do not select a fruit or vegetable with their meal will be charged a la carte for their items, which is generally higher than the “meal rate.”

Thomas questioned the process for ensuring that students choose a fruit or vegetable, and Smith said that cashiers are trained to ring up the selections properly. She also said the district is considering creating a “share table,” where students can leave food they do not want for other students. Thomas said the idea of charging students more money if they do not select a fruit or vegetable “seems a bit intrusive” but that the district would “roll with it.”

Smith noted that in kindergarten through 8th grade, students can be served a fruit or vegetable, but that in 9th through 12th grades, “we can only offer, not put it on their plate.” She said while she looking forward to the fact that students are being encouraged to make healthier choices, she’d be lying if she said she did not have the same concerns as the board about this new mandate.

Lightfoot asked if the increases in the Chartwells contract come automatically, and Doerte explained that yes, the management and administrative fees have increased every year due to the CPI. Lightfoot also verified that the district receives $500,000 no matter what – so that if the net income from the program is only $300,000, Chartwells will write AAPS a check for $200,000, and Doernte said that is correct. Allen pointed out that food service money is a separate fund that can only be applied to certain expenditures.

Finally, Lightfoot asked how the district tells the difference between legitimate and non-legitimate complaints about the food. Allen said that he and Doernte will sometimes arrive unannounced at the schools and eat the food being offered to the students. Smith suggested that the district could do student surveys. Holland said the trustees were welcome to eat in any of the district’s 33 lunchrooms anytime.

Nelson encouraged the sharing table, and Patalan said she is happy with the food education that is going on.

Outcome: The food service contract renewal was approved unanimously as part of the consent agenda.

Administrative Software Upgrade

Green explained that the Washtenaw Intermediate School District is considering having a uniform software platform for human resources and finance across the county. She said a recommendation for New World Systems Logos.NET for K-12 has been made after a year-long study. Green thanked Allen, Comsa, and director of human resources Cynthia Ryan for their work with the WISD selection process, noting that AAPS wanted to select software that would be fully vetted to work on both Apple and PC machines – because AAPS is an Apple district.

Green noted that the board would need to approve the purchase of this software by the end of June for the current pricing to be guaranteed. Allen drew the board’s attention to the cost summary in the board packet, pointing out that the cost would be $468,000 over the first five years, which would be entirely covered by the recently approved tech bond. In year six, Allen said, the district would have to bear the software support cost, which is estimated to be $51,000 annually. Due to the ongoing costs just in the finance department related to the current software report generation costs, Allen said the new software would not cause additional expenses, but rather would shift current costs.

Thomas confirmed with Allen that the district is positioning itself to take advantage of the scale effects – to be realized if AAPS offers its services in finance and human resources to other districts – and that would eventually drive down costs.

Stead said she was concerned about switching to a PC-based system, even though the software is supposed to work on both platforms. She asked what the cost will be if in the end, if not all the other districts in Washtenaw county sign up. Stead noted that the original WISD transportation consolidation was supposed to include all ten districts as well. Green said it was her understanding that the other districts are also in the process of  approving the platform. But Stead questioned how other districts will pay for it – because they have not all just passed technology bonds. “I think good will is good, but we have been here before,” she said.

Nelson asked if the district was pleased with its current human resources and finance software. Allen told him AAPS was not pleased with the current software. Allen explained that support has been dwindling over the years, and that AAPS often has to pay extra for a software developer to write code to generate reports that are not part of the package. Allen added that the new software will be web-based, and have drop-down menus that allow users to create reports. “From an efficiency standpoint, we have to make a change,” he argued, adding that it would cost AAPS much more to purchase new software outside of the group rate being offered as part of the WISD. Nelson pointed out that the cost of this upgrade would have needed to come out of the general fund, if the community had not passed the tech bond.

Stead said she was in favor of the software purchase, calling it “directionally correct,” but said that she would have liked to see a business case made for how much AAPS can potentially gain, depending on the number of districts that actually sign up.

Lightfoot asked if more districts in the county are likely to participate in transportation if they are first participating in this shared software purchase. Allen responded by saying there is still talk of consolidating special education transportation services.

Mexicotte suggested a friendly amendment to remove the word “irrevocably” from the resolution to approve the resolution, since nothing can prevent a future board from making different choices. There could be circumstances that the board can not anticipate which would make AAPS want to revisit this choice.

Green added that she would like the district to move toward zero-based budgeting, and that such a move would be difficult with the current software. She pointed out that zero-based budgeting allows for more transparency, and Allen added that it can also allow for more precise budget projections, because the majority of the district’s costs are in human resources.

Stead asked how friendly the user interface is, and Allen said it is very easy to use. Green added that the ease of use can make it more helpful at the school level too. Stead said she liked the fact that the software will allow more staff to meet more reporting requirements as those requirements continue to increase.

Outcome: The administrative software upgrade was approved unanimously as part of the consent agenda.

AAPS Policy Review

Mexicotte noted that the policies being reviewed that night were being treated as special briefing item – in the hope that the board could cancel the June 27 regular board meeting. [The board will be meeting in executive session at 5:30 p.m. on June 27 to evaluate Green formally in a closed session. Around 70 members of the community have been surveyed for the purposes of the evaluation: .pdf of survey form contents. For Chronicle coverage, see "AAPS Begins Superintendent Evaluation."]

Mexicotte reviewed the eight policies being presented – the entire 7000 series, regarding communication and community relations – most of them with no changes. The policies were reviewed only because they were nearing expiration. She noted the few minor changes being presented, and asked trustees asked a few clarifying questions.

The board made a few small wording suggestions to clarify meaning in the set of policies without much discussion.

Outcome: Policies in the 7000 series were approved unanimously as part of the consent agenda, which – in addition to the items above included the third quarter financial report, and donations.

Board Action Items – Contracts

The board took action at this meeting to renew a contract with one of its bargaining units, and to ratify the employment contract of a new administrator.

Contracts: AFSCME Extension

AAPS deputy superintendent of human resources and general counsel Dave Comsa recommended that the board approve a contract extension with AFSCME Local 1182, which primarily represents the district’s custodial and maintenance staff. Comsa added that AFSCME members have already ratified the contract.

Outcome: An extension of the AFSCME contract was approved unanimously.

Contracts: Asst. Superintendent – Robyne Thompson

Green requested that the board approve a contract which had been extended to Robyne Thompson. Thompson will be joining the district in the role of assistant superintendent for secondary education following the retirement of longtime AAPS teacher and administrator Joyce Hunter, who currently holds that position. Green read a statement about Thompson, highlighting her work with social and emotional learning, her doctorate degree, and her extensive professional experience. Thompson is currently a middle school principal in the Utica Community Schools district.

Lightfoot asked if Thompson had signed the employment contract yet. Green reported that Thompson has signed it, but Green has not signed it and would not do so until after the board approved the contract. Green also noted that Thompson would be paid the same rate as Hunter, and that Thompson would be taking a pay cut to join AAPS. Lightfoot also asked if Thompson was planning to move to Ann Arbor to take this position, but Green said she did not know, and that AAPS did not have a residency requirement for staff members.

Stead asked about a phrase in the contract that ensured Thompson’s salary would not decrease, and asked how that could be affected by future administrative salary budget reductions. Mexicotte added that there have been periods in the district where cabinet members have agreed to “share the pain” of budget reductions.

Comsa said the contract is a two-year agreement, which is standard for Class 1 personnel. He said lowering Thompson’s salary before the contract expires would require the district to enter into negotiations with her, and Lightfoot pointed out that that would be the case for all Class 1 employees. Comsa agreed, and said it would be true for employees covered by union contracts as well.

Outcome: The board unanimously approved the proposed contract with Robyne Thompson.

Mexicotte stated that she was happy to be among the first people to welcome Thompson to the district.

Association Reports

Five associations are invited to make regular reports to the school board: the Black Parents Student Support Group (BPSSG), the Ann Arbor Parent Advisory Committee for Special Education (AAPAC), the Parent Teacher Organization Council (PTOC), the Ann Arbor Administrators Association (AAAA), and the Ann Arbor Education Association (AAEA). The Youth Senate is also invited to speak once a month, as are representatives from each of the high schools.

At this meeting, the board heard only from the Youth Senate. Priyanka Menon said students receive a world class education in AAPS, and that being at Skyline has been “phenomenal.” She said as long as every voice is heard, there is no problem the district cannot solve, and said she hopes AAPS continues to maintain high standards. Blaire Crockett called AAPS a “close-knit community” that she has been grateful to be a part of. She noted that AAPS cares for its students, and is loyal to them.

Awards and Accolades

Numerous individuals and groups were praised for their accomplishments at the June 13 meeting, including the 2012 graduates, individual students, and two retiring members of the superintendent’s cabinet.

Awards/Accolades: Graduations

The meeting began with a graduation video montage celebrating the successes of graduating seniors at Community, Skyline, Huron, Pioneer, and Ann Arbor Technological high schools. Multiple trustees pointed out that this was the first time there were five different graduation ceremonies in the district, and congratulated Skyline for graduating its first class. During the “items from the board,” section of the agenda, Stead pointed out that Skyline did a great job of highlighting the comprehensive experience students have there, as well as “establishing their legacy.”

Awards/Accolades: Envision Michigan

Two AAPS seniors– Priya Menon and Aoxue Tang– were awarded $500 Envision Michigan scholarships by state senator Rebekah Warren. Warren staffer P.J. Petitpren was on hand to present the awards, and noted that the application for the scholarship was simple, requiring only a 750-word essay on the topic, “If you were governor, what would you do?”

Calling Menon “a woman ready to go forward,” Petitpren noted Menon will attend Harvard in the fall to pursue her interest in law and politics. Petitpren noted that Tang, was unable to attend because she has gone to China with her family for the summer, will be attending Stanford in the fall.

Mexicotte said she was pleased to have Petitpren come and present these awards.

Awards/Accolades: Jay Jondro

Green introduced longtime AAPS staff member and master plumber Jay Jondro, who on two occasions has saved the lives of others. Saying that Jondro has been a role model for students, and has distinguished himself as an asset to AAPS, Green said he was being presented with a special recognition for acts of heroism and acts of service to the community and the district. Jondro thanked the board for its recognition, but said it was part of his duty.

Green also thanked AAPS executive director of physical properties Randy Trent for bringing to the board’s recognition that one of his employees was deserving of this special recognition.

Awards/Accolades: Retirements

Green recognized two members of her cabinet who were retiring – director of community education and recreation Sara Aeschbach and assistant superintendent of secondary education Joyce Hunter.

Green praised Aeschbach for having transformed the Rec & Ed department into becoming self-sustaining, and noted her long tenure with the district. Aeschbach has worked for AAPS since 1981. Lightfoot added that Aeschbach was very gracious to her when she became a trustee, and said she was inviting, informative, and passionate about her work. Mexicotte extended her appreciation to Aeschbach as well, as did Patalan, who said that Aeschbach was “calm, funny, personable, kind ,and a treasure” and that she was happy to have had the chance to work with her.

Green said that Hunter has had an illustrious career in AAPS beginning as a teacher in 1974. She became class chair, then a principal, before moving to central administration, Green said, and has been instrumental in the career and technical education program, which allows students to receive on-the-job training while still in high school. She noted Hunter’s graciousness, thoughtfulness, and kindness. Green also noted Hunter’s many activities beyond her work in the district, and said, “You are a significant leader, and I know that we will still be seeing you in the district, and in the community.”

Mexicotte also extended her appreciation to Hunter, who was present at the meeting and enjoyed a standing ovation from the entire room. Lightfoot added that she loved Hunter in many capacities, and called her a “saving grace” for many students at Huron in the 1980s, including Lightfoot herself. “I’m glad you’re still so young and pretty that you can get out and do your thing… I’m looking forward to what you’re going to be doing with that museum,” she said. [Hunter is a founding member of the African-American Cultural and Historical Museum of Washtenaw County.] Finally, Patalan also praised Hunter, saying she was happy to have been able to work with her, and that she goes back the longest with Hunter compared to anyone else in the room, having served with her on a high school review committee in the mid-1990s.

Awards/Accolades: Superintendent’s Report

In addition to some of the items listed above, Green praised the students who participated in the Special Olympics games, saying it was a wonderful achievement, and noting they brought home many medals. She also expressed thanked the staff, the community, and the board for supporting students this year, and her staff who helped her go through her first year in AAPS.

Agenda Planning

Stead requested that the board discuss Skyline’s trimester system, and said that some parents are concerned that their students do not have the flexibility they expected regarding the ability to dual-enroll in Skyline and Community high schools – because the two schools are on different schedules. Mexicotte asked Green how she would recommend approaching this issue, and Green said this is a topic that is already under discussion. She suggested that the board take up the discussion at a future committee-of-the-whole meeting.

Lightfoot said that she, too, was looking forward to hearing about the trimester issue, and noted that she loves it for the mastery approach it fosters. “Because [students] have so much room in their schedule, they are able to catch up,” she asserted.

Lightfoot said she also wants to be sure that summer school meets the district’s needs as it moves to close the achievement gap, and that Green has led her to believe that summer school is being evaluated that way. She questioned why students who have not actually failed, but have received a D- for example, are not included in summer school.

Nelson said he misses the old days where the board sat down with everything in front of it and set priorities. He said that every time there is a board meeting, one to four ideas come out, and all of them take up significant staff time. “I want this great professional staff that we have to be focusing on really important things,” Nelson said.

Mexicotte said the board is looking to have a retreat about superintendent and board goals in August, and that such a retreat might be the time for “setting those broader directions.” She said she was considering flipping the committee-of-the-whole and regular meetings in August, so that the August 1 meeting would include retreat-type activities, and the August 15 meeting could address business that comes up just before school begins for the next year. Mexicotte closed by agreeing that that board does not yet have the committee-of-the-whole process streamlined, but that the board will keep working on it.

Items from the Board

Thomas said he had attended a concert put on by the community outreach music program, which is sponsored by the Ann Arbor School of Performing Arts in cooperation with the district. The program allows students who would not normally be able to have private music lessons to take them at a greatly reduced cost, Thomas said. He recognized the contributions of AAPS staff members Robin Bailey, Fred Smith, and Abby Alwin for their role in the program.

Thomas also encouraged everyone to participate in the AAPS Educational Foundation’s Million Reasons campaign.

Nelson said that he was pleased to say he’s the proud owner of a medal from Northside Elementary, as he was the honorary starter of a 5K race at the school.

Lightfoot shared that she was invited by the Wayne State Board of Governors to join an oversight board there, and pointed out that higher education is facing some of the same challenges as K-12 education. She also said she has been in contact with many of the community assistants in the high schools about how they see their role changing with the reduction of the three dedicated police officers. And, finally, Lightfoot congratulated the Logan 5th graders, and thanked all the schools for holding “phenomenal” graduation ceremonies.

Patalan said that as she was reflecting on the graduations held throughout the district last week, she had to pause and think, “What a fabulous group of young people who are now our future.” She said she was so proud of AAPS, and noted that each graduation had its own “flavor, and was fabulous, and beautiful, and delightful in its own way.”

Patalan said that while the board has been hearing a lot in the past 60 days from people who are upset or concerned, the district really is doing a good job. Patalan asserted, “There is nothing like education – it is worth putting all of our time and energy into.”

Stead quipped that there would be a “little jog through town on Sunday,” referring to Ann Arbor’s inaugural marathon. She said it primarily benefits AAPS through the AAPS education foundation, and said that if people are not running themselves, she hoped they would come out and support it. [Stead ran the marathon herself, and finished in 7th place among female participants, with a time of 3:40.]

Mexicotte reported that her son participated in the recent Special Olympics on a team sent by Pioneer, and thanked the parents and staff who supported that effort.

Present: President Deb Mexicotte, vice president Christine Stead, secretary Andy Thomas, treasurer Irene Patalan, and trustees Simone Lightfoot (arrived at 7:50 p.m.) and Glenn Nelson.

Absent: Trustee Susan Baskett.

Next regular meeting: Wednesday, June 27, 2012, at 7 p.m. in the fourth-floor conference room of the downtown Ann Arbor District Library, 343 S. Fifth Ave., Ann Arbor.

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School bus operated for Ann Arbor Public Schools headed north on State Street on Jan 27, 2012. Changes to the way AAPS provides transportation services was a major theme of the AAPS board's Jan. 25 committee meeting.

That led to a vigorous discussion of the district’s immediate and longer-term options to continue to function in a challenging fiscal and political environment beyond 2012-13. “Everything has to be on the table … Education is not going to be the same,” said trustee Susan Baskett.

Mexicotte agreed, saying the time for incremental change has passed, and that the district “might need to make some bold moves.”

As options to consider for the following year, trustees listed the following: redistricting; eliminating 7th hour high school classes; closing schools; sharing principals; passing a countywide enhancement millage; changing high school start times; moving more athletics extracurricular activities to a “club sports” model; increasing the number of online class offerings; changing state law; working with the University of Michigan to allow AAPS students to earn credit hours there at a reduced rate; and moving to a balanced calendar district-wide.

In some detail, the board also evaluated its options for busing – in light of news that the Ypsilanti and Willow Run public schools are considering pulling out of the Washtenaw Intermediate School District’s transportation consortium. That would leave Ann Arbor as the sole participant in the consortium.

Trustees directed administration to examine and make a recommendation on the following transportation options: improving busing within the current framework of the WISD; consolidating busing with Ypsilanti and Willow Run outside the WISD consolidation; bringing busing back into the AAPS budget with bus drivers remaining public employees; bringing busing back into the AAPS budget but privatizing bus drivers; eliminating busing entirely; or collaborating with the Ann Arbor Transportation Authority (AATA) to transport AAPS students.

Several trustees also made plugs for protecting classrooms from the effect of budget cuts, and even suggested lowering class sizes. AAPS superintendent Patricia Green suggested it was also important to relieve some of the pressure and anxiety felt by teachers and other district staff. “We are at the tipping point,” she said, “Five years of budget cuts can take its toll.”

Also at the Jan 25 COTW meeting, trustees heard updates on the AAPS preschool and family center programs, including some discussion of the county’s relinquishing of its management of the federal Head Start grant. And, the board was briefed on the implementation of the Measures of Academic Progress (MAP), a new assessment tool the board approved for purchase last May.

Budget Update

Superintendent Patricia Green introduced the budget update by urging the board to consider a “balanced approach.” Later, she clarified, “We have fund equity for a rainy day – it’s pouring. It is my recommendation that we use fund equity this year.” Robert Allen, the district’s deputy superintendent of operations, said that in his view, the district was “past the tipping point” in terms of acceptable budget reductions. He noted that Gov. Rick Snyder will be proposing his budget on Feb. 9. That will give AAPS an idea of what its foundation allowance will be, but  Allen reiterated that AAPS is anticipating the need to reduce the FY 2012-13 budget by $14 to $16 million.

At the Jan. 25 COTW meeting the board discussed the 2012-13 budget mostly in broad strokes, rather than focusing on the evaluation of specific budget reduction suggestions. Trustees aligned themselves philosophically behind the idea of dipping into fund equity, a topic about which they have previously been quite split. They also discussed the budget-creation process – specifically how to engage community members most effectively and to make their input as useful as possible.

Budget Update: Using Fund Equity

Trustee Andy Thomas suggested that the board should try to meet half of its budget reduction target by reducing expenditures and enhancing revenue, but should meet the other half by taking the money out of fund equity. He noted the one-time funding AAPS received from the state to reward state-identified “best practices,” and Medicaid reimbursement as unanticipated sources of revenue that could be used to offset any budget cuts.

Thomas was clear that using fund equity would stave off the more difficult decisions only for one more year – due to the structural funding deficit facing the district. However, he said, that would give the district another year to have the kind of conversations in the community about what major things could be done, and a year to get any of those plans in motion. Optimistically, Thomas also said that there could be a change in the priorities of the governor or state legislature as Michigan’s economy continues to recover.

Trustees each expressed support for Thomas’ proposal, at least in theory. “I don’t know whether I buy into the ‘half’ formula, but I want to be supportive of using fund equity instead of trying to solve it all through revenue enhancement and expenditure cuts,” Nelson said.

Mexicotte agreed philosophically, she said, with using fund equity to give the district a “respite.” She argued, “It’s been hellacious the last couple of years and it’s just too much. Our people don’t deserve it. Our students don’t deserve it.”

Even Stead agreed, whose position on using fund equity has been among the most conservative of her colleagues. “I would be more comfortable using fund equity if we feel like we can get some political change … I’m certainly comfortable being a little more risky.” Lightfoot expressed support at Stead’s evolving position, to which Stead responded, “I’m not proud of myself.”

Budget Update: Budgeting Process

Trustee Christine Stead suggested that the board should spend the next few months working with the community to develop budget solutions specific to the areas most likely to be impacted. She noted that it would be more effective to engage the community sooner in forming partnerships rather than dealing with informing everyone over the summer of the impact of budget changes. “I think we need to fast-track [the process] and help people focus on areas we already know will be impacted,” she suggested.

Mexicotte went a step further, saying, “The community forums are not going to get us where we need to be at this point … I think we need to use to expertise we have.” She suggested that the administration was in a better position than the community to know what cuts have been made over the past few years, and to suggest how to proceed. She also suggested that it might be time to stop making incremental adjustments and instead to “make some bold moves.”

Baskett suggested changing elementary school boundaries [redistricting], or altering start times at high schools. “Everything has to be on the table,” she said. Education is not going to be the same.” Stead suggested making further cuts to athletics, and instituting a balanced calendar district-wide.

Mexicotte said she would be on board with any suggested changes that would provide a budget solution while strengthening educational outcomes. “Let’s be bold. Let’s put it all on the table – whatever it is,” she suggested. “I would like to know the very best thinking of our team … I would like to know what its worth to redistrict, to close a building … I don’t know if that’s what I want to do, but if it [leads to] better outcomes, I want to know the options.”

Mexicotte closed by asking Allen and Green if they felt they had received appropriate direction form the board, and they said they had.

Transportation

The one area in which the board did dive into budget specifics was busing. That was prompted by news that Ypsilanti and Willow Run public schools decided this week to consolidate transportation services in their districts, and put out a request for proposals (RFP) for transportation services.

Allen explained that if Ypsilanti and Willow Run quit the existing consortium of districts getting transportation services through WISD, that would would leave only AAPS in the WISD consortium.  That would significantly increase management costs that have, up to now, been shared by the members of the corsortium. He also noted that there has been a lot of talk at the state level about the possibility of consolidating school districts. Green suggested that merging transportation operations may be the first step toward a broader consolidation of Ypsilanti and Willow Run.

Transportation: Board Response to Ypsi/Willow

Trustees asked why Willow Run and Ypsilanti public schools made the decision to band together, with an eye to withdrawing from the WISD consortium. WISD assistant superintendent for business services Brian Marcel responded that both districts are under a lot of financial stress and are likely trying to be sure they do their due diligence. He noted that if the WISD responds to the joint RFP put out by Willow Run and Ypsilanti, it would be “competing against ourselves.”

Trustee Glenn Nelson added that he thought the Ypsilanti/Willow Run RFP was motivated by a desire to privatize services in order to get out from under the state retirement system mandate, which is rising to an employer contribute rate of 27% of total salaries. Nelson suggested that the board should explore whether AAPS could join the RFP process. Nelson said that privatizing transportation services – with or without Ypsilanti and Willow Run – would yield significant savings, though he said he was not necessarily advocating for that.

Mexicotte said that it distressed her that Willow Run and Ypsilanti “did not make a phone call to say they were going to do an RFP.” Trustee Susan Baskett agreed, likening the situation to AAPS “getting dumped at the prom.” Mexicotte reiterated how AAPS had decided to stay in the WISD consortium even when all but three districts pulled out because AAPS was the “linchpin” needed to make it work for the other districts. “I’m trying desperately to hang onto a top-drawer educational system, and I feel like at every turn we are being thwarted,” Mexicotte said. She suggested considering taking buses and drivers back within AAPS, or alternately, cutting busing entirely.

Marcel said the WISD has tried to be responsive to AAPS, and that it was not a fair assessment to say WISD had not addressed inefficiencies. When AAPS decided to change its overall transportation policy this year, Marcel said, “that changed everything.”

Transportation: Evaluation of WISD Transportation Services

Trustees Simone Lightfoot and Christine Stead expressed concerns that the board has not been given a requested update on operational statistics from the WISD. The operational stats would include a detailed breakdown of on-time arrivals and departures, and accidents/incidents. Marcel said the WISD has provided the board with a financial report, and will be undertaking a customer satisfaction survey of parents in the spring.

Stead said continuing to receive transportation services from the WISD wouldn’t be compelling if two of the three districts pulled out of the consortium. She added that the operational statistics were necessary to decide if AAPS should continue to work with the WISD on transportation. Lightfoot agreed, saying that the spring was too late to receive this information.

Mexicotte suggested to Marcel that he meet with trustees one-on-one to address their frustrations. She noted that the board has made “numerous” requests for information from the WISD that it has not received.

Transportation: Special Education Busing

Thomas wondered whether AAPS would leave special education busing in the hands of the WISD regardless of what it decides to do regarding general education busing. Allen said that was definitely a conversation that should happen, and noted that the fact that special education buses carry low numbers of students to central locations makes the consolidation of those services particularly appealing.

Transportation: AATA

Lightfoot strongly advocated subsidizing the Ann Arbor Transportation Authority to bus AAPS students rather than eliminating busing entirely. “AATA is thinking about its role,” she said. “We have a responsibility to work across government entities for the benefit of taxpayers.” [Lightfoot was one of 39 people who spoke at a public hearing on transportation held at a meeting of the Ann Arbor city council on Jan. 23. In her remarks, she encouraged increased collaboration between AAPS and AATA.]

Lightfoot also said she leaned toward supporting AATA rather than the WISD – because the AATA is in the business of providing transportation. She suggested that the AAPS could subsidize student bus passes, and that it’s important to give the community options, if AAPS eliminates busing entirely.

Baskett noted that if AAPS eliminates busing, many students will look to AATA to provide that transportation, and suggested that AAPS should give AATA a “heads up.”

Stead expressed concern with working with AATA while the transit authority is in the midst of a major transition to a countywide model. She noted that while Ann Arbor will still hold nearly half the seats on the restructured AATA board [7 of 15], it would not have a majority. Green agreed, saying that coordinating student transportation with AATA “is not as easy as it sounds, [and] … cannot happen on a short turnaround at all.”

Thomas noted that the basic problem with using AATA buses for students as he saw it was that AATA routes are “spokes of a wheel… intended to bring riders downtown, not to distribute people around the edge of the wheel.” Lightfoot said that AATA could be used to work in certain areas or at certain times of day, but Stead countered that AAPS cannot offer busing inequitably within student groups.

Nelson stated that there are models for this sort of cooperation, such as in Madison, Wisconsin. The strongest argument against the idea that it’s too hard, he said, is that this model works in other places.

Preschool/Headstart Update

Michelle Pogliano and Kecia Rorie – principal and vice-principal, respectively, of the district’s Preschool and Family Center – gave their annual report to the board outlining the various programs and services serving the youngest AAPS learners. The preschool serves children and their families from birth to five through four main programs – Head Start, the Great Start Readiness Program (GSRP), Early Childhood Special Education (ECSE), and Early On. Children can qualify for services in a variety of ways – based on low income, being “at-risk of school failure,” or having developmental delays or special needs.

Pogliano explained the impact on the preschool of Washtenaw County’s decision to relinquish management of the federal Head Start grant. At this time, she said, a request for proposals (RFP) has not yet been issued for another entity to take over Head Start, but it is anticipated that the Washtenaw Intermediate School District (WISD) will submit a proposal to become the new grantee. If local management of Head Start shifts to the WISD as anticipated, Pogliano said, AAPS preschool will remain a “delegate site” and the program’s structure will remain the same.

Nelson noted that Head Start’s grantee is required to make a 25% match of federal funding for program costs. He expressed concern about how that will play out. He questioned what the WISD would have to cut in order to provide the matching Head Start funds, which he estimated to be about $400,000.

Stead pointed out that federal funding is also likely to decrease over the next ten years, leading to a cumulative reduction that could have a serious impact on the ability of Head Start to be sustainable. Lightfoot agreed, saying that she feared the program might be phased out all together.

Trustees praised the preschool staff members for their dedication, and expressed their support for the preschool, regardless of what happens to federal Head Start funding. Pogliano said the new grantee should be in place by April.

Measures of Academic Progress (MAP) Assessment

AAPS deputy superintendent of instruction Alesia Flye, director of instructional technology Anne Reader, and director of student accounting, testing, and administrative support Jane Landefeld updated the board on the implementation of the Northwest Evaluation Association’s (NWEA) Measures of Academic Progress (MAP) assessment in the district this fall.

The board approved the purchase of the MAP in May 2011. It is an adaptive, computerized assessment of math and reading skills. The MAP is currently being administered to all AAPS students in grades K-5 and K-8 students at Ann Arbor Open at Mack and the Scarlett-Mitchell campus. It’s administered three times a year – in September, January, and May.

At the Jan. 25 COTW meeting, both Flye and superintendent Patricia Green acknowledged that the rollout of the new assessment tool had been rocky, but that staff is now more comfortable with it.

Green said there was a time this fall when the district had to decide whether to follow through with using the MAP. “There were complications with the implementation due to our archaic technology… It became a real nightmare,” Green said. She explained that after significant retooling of the product, by both the vendor and AAPS instructional technology department, “the glitches weren’t there this time around.”

Reader detailed how professional development has been used to teach AAPS staff how to administer the MAP, as well as how to use the data it provides. She walked the board through some examples of the reports and planning charts teachers can access, as well as how individual student data will be shared with parents. Use of student growth data among third grade teachers at Allen Elementary was highlighted.

Trustees expressed excitement about the uses of the growth-over-time data provided by the MAP, as well as the utility of looking at MAP data side-by-side with other information about students – such as classroom grades, other assessment scores, and demographic data.

Mexicotte noted that this work supports the “personalized curriculum” objective of the district’s strategic plan. Nelson and Thomas noted how MAP data can aid the district in closing the achievement gap.

Baskett requested that the information sent to parents about individual student data should be written in more user-friendly language and include suggestions on available resources for helping struggling students. Nelson agreed, saying, “If you tell someone they’ve got a problem, and don’t tell them what to do about it, you just cause stress and anxiety.” Green said that Flye has “tremendous talent” in communicating with families about student data, and that she was currently working on that.

Trustees also suggested there might be a need to increase the student accounting support staff as the district’s data management needs increase. Green agreed, “The workload is enormous.”

Agenda Planning

The board agreed to amend its meeting schedule to avoid meeting five weeks in a row – by canceling its Feb. 1 meeting, and switching the order of the next two meetings. The next regular meeting will be on Feb. 8, and a COTW meeting will be held on Feb. 15.

Present: President Deb Mexicotte, vice president Christine Stead, secretary Andy Thomas, and trustees Susan Baskett, Simone Lightfoot, and Glenn Nelson.

Absent: Treasurer Irene Patalan

Next regular meeting: Wednesday, Feb. 8, 2012 at 7 p.m. at the downtown branch of the Ann Arbor District Library, 343 S. Fifth Ave. [confirm date]

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The budget calls for expenses of $30,410,616 against only $29,418,995 in revenues, for a deficit in the coming year of $991,621. That shortfall will be made up by drawing on the fund balance. According to the budget resolution, the AATA’s fund balance policy requires it to maintain reserves equal to at least three months’ worth of operating expenses. And the AATA expects to have $1.2 million more in its fund reserve to start the year than that minimum fund balance policy requires. So the projected deficit – which the budget resolution attributes partly to one-time expenses associated with the transportation master plan – is within the $1.2 million excess beyond the minimum three-month reserve, which the AATA holds in its fund balance. [.pdf of AATA 2012 operating budget]

During  deliberations, the four board members present stressed the unique, one-time nature of the deficit budget.

In the most significant categories, the AATA’s revenues break down percentage-wise as follows: 31.4% local transit tax; 29.4% state operating assistance; 18.6% passenger fares; 12.8% federal operating assistance. The AATA also receives some revenue from surrounding municipalities that get transit service through purchase of service (POS) agreements. [2012 AATA revenue pie chart]

In the most significant expense categories, the AATA’s expenses break down percentage-wise as follows: 54.7% employee compensation; 18.2% purchased transportation from other providers; 9.3% other purchased services; 5.7% diesel fuel and gasoline. [2012 AATA expenses pie chart]

In a separate vote, the AATA board also approved the 10-page work plan for the fiscal year. Highlights include reconstruction of the Blake Transit Center in downtown Ann Arbor. In terms of increased service, the work plan includes a focus on: establishing the AATA as a vanpool service provider; establishing service to the Detroit Metropolitan Airport; improved work-transportation connections between Ann Arbor and Ypsilanti; and continued work on commuter rail.

The plan also calls for continued work on the AATA’s information technology, including its website as a communication tool and improved point-of-sale systems to allow people to pay for their fares. [.pdf of work AATA 2012 work plan]

This brief was filed from the downtown location of the Ann Arbor District Library, where the AATA board holds its meetings. A more detailed report will follow: [link]

While the city and the DDA have achieved much agreement on the non-monetary details of the arrangement, Wednesday’s board meeting left the financial piece still unclear.

Keith Orr pores over the figures under various scenarios for the new contract under which the DDA would operate the public parking system. (Photos by the writer.)

The board discussion included a focus on the contrast between the combined fund reserve of the DDA – which includes those funds it collects as a tax-increment finance authority – and the reserves of just the public parking fund. Sandi Smith, who’s a DDA board member and an Ann Arbor city councilmember, stressed throughout the conversation that it’s not just the overall fund balance, but the public parking fund balance itself that needs to be monitored.

Last week, the board had come to a consensus that the public parking system could absorb a payment to the city equal to 16% of gross parking revenues in every year of a 10-year contract, which represented a revision upward from its previous position of 14% in the first two years, followed by 15% in subsequent years.

After lengthy back-and-forth, the only consensus reached by DDA board members was that they were not prepared to revise their position upward (again) to meet the city’s request that the city be paid 16% of the public parking gross revenues in the first two years of the contract, but 17.5% in remaining years. Mayor John Hieftje, who serves on the DDA board, was the lone voice of support for that position.

The mayor also found himself somewhat isolated on another issue in front of the board at its Wednesday meeting – the only action item on the agenda. The board voted to sign a new, more favorable lease agreement for its roughly 3,000 feet of office space at 150 S. Fifth Ave. for a term of five years.

Although the mayor voted with the rest of the board in authorizing the lease agreement, he had announced at the city council’s Monday, April 4 meeting that he would be asking his fellow DDA members to consider moving into space that’s currently being renovated in the city hall building. Two days later, at Wednesday’s DDA board meeting, the mayor appeared to understand that there was little enthusiasm on the board for the move, based partly on the fact that it would cost the DDA more in the short term.

At the meeting, the board also heard its usual range of reports and communications, including an update from DTE on the addition of a new substation near the Broadway bridge, to meet increased demand for electricity.

City-DDA Parking Contract: History

The current 10-year contract, under which the DDA operates the city’s public parking system, expires in 2015 – with an option for the DDA to renew through 2018. That contract calls for the city to be paid $1 million in “rent” per year out of the public parking system, plus additional money into the street repair and maintenance fund totaling roughly $850,000.

A provision in the contract allows for the city to request that a double payment of $2 million be made in any one year out of the parking system, provided that the total amount in rent paid over the contract period does not exceed $10 million. When the contract was signed in 2005, then-city councilmember Leigh Greden told the DDA that it was only due to the dire financial condition of the city that year that the double payment was being requested in the first year of the contract – the double payment was not assumed to extend beyond that first year.

However, the city has requested the double payment of $2 million over each of the first five years of the contract. And last year, the DDA board authorized an additional double payment of $2 million not required by the contract, bringing the total rent paid to the city out of the public parking system since 2005 to $12 million. [See Chronicle coverage: "DDA OKs $2 million Over Strong Dissent"]

Newcombe Clark (far left) and Roger Hewitt (far right) point at a list of different payments made out of the public parking fund to the city. Turned in their seats looking at Hewitt are John Splitt and Gary Boren.

In addition to that money, over the last two years the DDA has agreed – outside the context of that contract – to donate proceeds from the 415 W. Washington and Fifth & William (the old YMCA) parking lots to the city. That move was motivated by a desire of the DDA to forestall the installation of parking meters by the city of Ann Arbor in residential neighborhoods to generate direct revenue to the city’s general fund budget. The city made that move as a part of its FY 2009 budget, approved in May of that year. By providing revenues that would at least partially replace money the city thought it could generate through meter installation, the DDA reduced the pressure to install the meters.

The DDA opposed meter installation at those locations, partly due to skepticism that they would actually generate very much revenue for the city, partly based on the fact that the DDA believed the city did not have the authority to install such meters, and also that the residential locations were unsuitable for parking meters.

[More background on the meter installation in previous Chronicle coverage: "City-DDA Parking Deal Possible"]

City-DDA Parking Contract: Negotiations, Outline

The negotiations between the city and the DDA are being handled by two “mutually beneficial” committees – one composed of Ann Arbor DDA board members and the other made up of city councilmembers. On the council’s committee are councilmembers Carsten Hohnke, Margie Teall and Christopher Taylor. Serving on the DDA committee are Gary Boren, Russ Collins, Roger Hewitt and Sandi Smith. The committees began meeting in public view in June 2010, after a “work group” had met privately starting in January of that year.

The original target date for a completed new parking agreement was Oct. 31, 2010. The two mutually beneficial committees had begun meeting on a once-monthly schedule, but at the urging of Susan Pollary, executive director of the DDA, they increased their meeting frequency to twice monthly, beginning in late summer 2010. And over the last several weeks, the two committees have been meeting at 7:30 a.m. every Monday morning trying to finalize details of the contract.

The work group that had met out of public view in the early part of 2010 produced a term sheet in spring 2010 to serve as an outline to the negotiations. It was on the basis of that term sheet that the DDA agreed to the extra double payment of $2 million last year. [See Chronicle coverage: "DDA OKs $2 Million Over Strong Dissent"].

A key concept of the term sheet was that the city would be held harmless financially. Other main points of the term sheet included [.pdf of complete term sheet]:

Parking Enforcement [...]
Throughout the City, the DDA will have primary, but non-exclusive, responsibility for enforcement of public-parking-related rules and regulations, including without limitation, expired meters, parking structure rule compliance, loading zones, and established residential parking permit zones (“Parking Codes”). [...]
Community Standards Code Enforcement in the DDA [...]
Within the DDA, the DDA will have primary, but non-exclusive, responsibility for enforcement of City ordinances now generally enforced by community standards officers, including without limitation, ordinances related to sidewalk clearance, debris, graffiti, and alley upkeep (“Community Codes”). [...]
Services in the DDA [...]
Within the DDA boundaries, the DDA will have primary, but non-exclusive, responsibility for delivering the preliminary list of services identified on “Exhibit 1”, attached. The DDA will deliver the identified services with at [sic] the identified service levels and frequencies. Generally, these are all services delivered currently delivered [sic] by the City within the DDA boundaries, excluding public safety, street clearing, and other services as identified in “Exhibit 1”. [...]
Development of City-owned Property Within the DDA District [...]
The working group envisions that the DDA would serve as a visioning, initiation and implementation engine for development of City-owned property within the DDA district. The nature and extent of this role will be discussed, considered and, if approved, implemented in parallel to any omnibus agreement, but would not be part of that agreement. [...]

The final point of the term sheet was, to some extent, addressed with the passage of a city council resolution on April 4, which tasked the DDA with leading a process to explore the future use of four parcels located in a rectangle bounded by Ashley, Division, Liberty, and William streets.

The middle two term sheet points – non-parking code enforcement done by the DDA and additional service enhancement to be performed by the DDA – were shed from the discussion fairly early in the negotiations.

The first term sheet point – that the DDA would enforce parking rules and write tickets – also did not make it into the draft contract. But vestiges of that idea remain in different places in the draft. The basic idea was that the DDA would like to have more direct influence on setting the parking policy – rates and hours of enforcement – and would like to maintain a more systematic communication with the city about parking policies. This basic notion was expressed at a city council meeting on April 19, 2010 when the DDA delivered a parking report to the city council. That parking report had been prompted by a Dec. 21, 2009 city council resolution that had contemplated, among other things, extending hours of parking meter enforcement past 6 p.m. – the evening enforcement provision did not pass on that occasion.

Some key features of the new draft contract include:

• Parking rates/hours to be set by DDA. The city council would not have a veto. [Currently the city council holds a veto on rate changes.] The contract stipulates that rates won’t be changed permanently without first: (1) announcing and providing written communication regarding details of the increase at a DDA board meeting; (2) at a subsequent board meeting, providing all members of the public a chance to speak before the DDA board on the matter – a public hearing; and (3) delaying any vote on the rate change until the board meeting following the public hearing.
• DDA to assist with directing parking enforcement. The contract calls for a Standing Committee to be formed that will meet for regular consultation about parking enforcement. The committee will consist of the executive director of the DDA, the parking manager, deputy police chief, community standards supervisor, and the city’s public services area administrator. This addresses the concern expressed by the DDA that while it already had the authority to set hours of enforcement (for example, for later in the evening), it could not actually schedule community standards officers to do the enforcement. [Currently, many downtown parkers pay for meters past 6 p.m. even though the meters aren't currently enforced that late.]
• City to report information to the DDA. The contract would call for the city to provide regular reports on its enforcement activity – data like how many citations have been issued and in which zones. The contract would also call for the city to provide reports to the DDA on its street maintenance activity in the downtown.
• Parking area defined. The contract provides a map designating exactly which areas the DDA has authority to decide placement of parking meters. Not included in the DDA parking area are any of the residential parking permit areas – a program over which the city will maintain its current control.

Leaving aside the financial aspects, the two mutually beneficial committees appear content that the new contract as drafted provides a level of clarity and communication for the operation of the public parking system that is a great improvement over the old contract.

City-DDA Parking Contract: How Much Money?

The two committees reached early agreement about the structure of the financial arrangement by which the city takes money out of the public parking system: It should be a percentage-of-gross formula that would aggregate all of the payments currently made to the city out of the public parking system. They disagree about how large the percentage should be. [Not included in the percentage-of-gross is a $500,000 payment the city receives from the DDA's TIF capture, which pays for part of the bonds issued to finance the city's new municipal center.]

On any of the percentage-of-gross scenarios, the city could essentially allocate its share of the public parking system revenues to whatever expenses it deems appropriate – its general fund, for example. But the city would presumably spend some fraction of the money on street maintenance in the downtown district – as a condition of the new contract, the city would be required to provide reports on its maintenance of streets where on-street metered parking is available. The term of the agreement has been discussed at varying lengths, but appears to have settled at around 10 years.

A fleeting part of the discussion in October 2010 were percentage-of-gross figures as high as 20% per year and as low as 10%. Fairly quickly, the city council’s committee settled into a position of 17.5%, except for the first two years of the contract, for which it was content with 16% – the 16-16-17.5 position.

The DDA’s committee consulted its full board at a Jan. 5, 2011 retreat, during which the board modeled the different percentage scenarios against its 10-year plan – a spreadsheet it uses to make financial projections. As part of any scenario, the DDA will be deferring some maintenance on the parking structures, in order to accommodate the city’s request for a new contract. The specific items to be deferred have been reviewed by the DDA’s engineering consultant.

All scenarios also assume that at least part of the down payment and bond payments for the underground parking structure currently under construction will be paid out of the DDA’s tax capture fund – its TIF fund. [During his campaign for reelection in 2010, mayor John Hieftje defended himself against criticism over the use of bonds to pay for the underground parking structure, saying the bonds would be paid from parking revenues. For discussion of the use of TIF in connection with payments to the city out of the parking fund, see "Column: Impact of City-DDA Parking Deal"]

At its Jan. 5 retreat, the board came to a consensus that the public parking system could absorb a percentage-of-gross figure of 14% for the first two years of the contract and 15% for the years thereafter – the 14-14-15 position. At the Monday morning mutually beneficial committee meeting on March 28, the council’s committee members told their DDA counterparts that they wanted the full DDA board to reconsider its view – the city was still committed to the 16-16-17.5 position.

So at an operations committee meeting two days later on March 30 – attended by 10 of 12 board members – the DDA board considered the city’s request and came to a consensus that the public parking system could absorb a payment to the city in each year of the contract equal to 16% of the gross parking revenues – a flat-16 scenario.

The following Monday, April 4, when presented with the flat-16 offer by the DDA committee, the city council committee insisted on its 16-16-17.5 position, and asked that the committee take its request back to the full board again.

So at its Wednesday, April 6 regular board meeting, the DDA board informally entertained that request, conveyed through the council’s committee, to rethink its earlier consensus compromise flat-16 position.

City-DDA Parking Contract: April 6 DDA Board – Taxes, Parking

At the April 6 board meeting, Sandi Smith – who serves on both the DDA board and the Ann Arbor city council – added to the mix of alternatives a proposal that would split a 10-year contract period in half: 16% of gross parking system revenues would be paid to the city for the first five years of the contract, and 17.5% would be paid in each of the five remaining years. It’s a half-and-half scenario.

In weighing how to give direction to Roger Hewitt – who was going to be meeting with the city council’s mutually beneficial committee on Friday, April 8 – the Wednesday board meeting discussion wound through familiar issues: (1) appropriate levels for fund balances; (2) the relationship of the DDA to the city; and (3) which fund balances matter.

Lodged firmly in the memory of DDA board members are remarks made by the city’s chief financial officer, Tom Crawford, at the Jan. 5, 2009 city council meeting, when the size of the Fifth Avenue underground parking garage was trimmed back by 100 spaces, so that it no longer extended down to William Street. [The reduced project means that additional construction would need to take place to achieve an underground connection to any future building on the old Y Lot or to the new Blake Transit Center, which is currently being designed.]

From The Chronicle’s report of the Feb. 17, 2009 Ann Arbor city council meeting:

Crawford reported that on looking at the DDA’s financial picture, he noticed that they don’t have a minimum reserve policy. He said he generally used 15-20% as a minimum reserve. In light of the need to maintain adequate reserves, he said that in his view the project is “not affordable with the plans they have.”

The 15-20% figure appears to be more of an ideal, whereas the practical recommended minimum range – used, for example, in the city’s own budget planning – is 8-12%. [More detail on the fund balance question in previous Chronicle coverage: "Ann Arbor DDA Barely Passes Budget"]

On the 16-16-17.5 scenario, the overall combined reserve balance across all of the DDA’s funds would dip to 7.4% of expenses in 2016, which is less than the lower limit of the 8-12% recommended range used by Crawford. On the flat-16 scenario, the lowest overall fund balance would be 10.9%.

At Wednesday’s board meeting, mayor John Hieftje responded to concerns about the DDA’s overall fund balance by reiterating his position that the DDA is part of the city. [This position was also apparent in his expressed interest in having the DDA move its offices into newly renovated space in city hall.]

Hieftje said the city is responsible for backing up the DDA. He compared the city’s role to that of a parent – the DDA is “like a child,” he said, whose debt the city must ultimately cover. He felt comfortable with the overall fund balances on the 16-16-17.5 scenario. Hieftje was also critical of the DDA’s conservative estimates of the growth of the TIF, citing the additional tax revenue the DDA would be capturing due to two specific projects – 601 S. Forest and Zaragon Place II.

Countering the mayor’s emphasis on TIF as a means by which the DDA could shore up its overall fund balances was Sandi Smith. At Wednesday’s board meeting she drew out a contrast between the overall fund balance, which she allowed was important to watch, and the parking fund itself. She’d made the same point a week before at the DDA’s operations committee meeting. The 16-16-17.5 scenario, she contended, made it impossible to use the public parking system as an economic development tool.

On any of the scenarios that begin with a 16% payment, the parking fund reserves would dip to zero in the first two years of the contract. In the city’s preferred 16-16-17.5 scenario, the parking fund reserves would stay below 8% from 2014-2018, with a low of 4.2% in 2015.

[Note: The DDA leases some private lots for public parking from owners other than the city; revenues from those lots are not included in the gross to which the percentage-of-gross would apply in the new contract. In spreadsheets compiled by The Chronicle using DDA data, this difference is reflected in two separate revenue totals – one for total revenues, and the other for revenues that don't include rent paid by the DDA to lease privately-owned parking lots.] [.pdf of flat-16 scenario] [.pdf of 16-16-17.5 scenario][.pdf of half-and-half scenario] [Google Spreadsheet]

Not a prominent part of the DDA board’s discussion on Wednesday was the idea – from the term sheet produced by the working group a year ago – that the city should be held harmless compared to the way it has withdrawn money from the public parking fund in the past. It has been a frequent point made by city council committee members in their discussions with their DDA counterparts over the last several weeks.

For the council’s part, of crucial interest are the first two years of the contract, because the city does its budget planning in two-year cycles – 2012 is the first year of a two-year cycle, and the budget for that fiscal year, which begins July 1, 2011, is now being prepared. Councilmembers point out that compared to previous practice, the roughly $2.5 million the city would receive in the first year (based on percentage-of-gross payment of 16%) reflects a difference of about $300,000 compared to what the city has historically received. That’s part of the reason they are keen to see that difference made up in the third year of the contract.

By The Chronicle’s calculation, for the nine years from 2012-2020, the city would receive about $26.5 million based on past habit and practice. That’s based on $2 million of rent plus an escalating payment into the city’s street repair fund, starting with $835,000 in the first year. That compares with $27.4 million the city would receive over the same period, based on the flat-16 scenario.

At Wednesday’s meeting, DDA board members did raise the question of the city’s need after the second year. Newcombe Clark asked on Wednesday why the city felt it would necessarily have a need for public parking dollars in 2020.

The week before, at the DDA operations committee meeting, Hieftje assured other DDA board members that he felt the recession could be over in four years time. Joan Lowenstein pointed out that this same argument, which he was using to assure the DDA board that their fund balances would be adequate, could be used to question whether the city would have a need for the parking dollars.

As Roger Hewitt expressed some urgency that he needed direction for the next meeting of the mutually beneficial committees, a straw poll was suggested. Hieftje was resistant to the idea, saying that Hewitt should glean his conclusions from the board’s conversation.

John Splitt, John Mouat, and Sandi Smith seemed to indicate they’d support a half-and-half scenario – 16% in the first five years and 17.5% in the remaining five years. Bob Guenzel said he felt that the flat-16 already reflected a lot of movement by the DDA from its previous position of 14-14-15, but wanted to give Hewitt some flexibility. Keith Orr also indicated he felt that in the spirit of mutual sacrifice, the DDA had come a long way to the flat-16 scenario. [Orr has for the last year consistently referred to the mutual sacrifice as opposed to the mutual benefit.]

Gary Boren –  who was running the meeting because Lowenstein, the board chair, was participating only by speaker phone – suggested that there was at least a clear consensus that board members were not prepared to meet the city’s request of a 16-16-17.5 scenario. With the exception of the mayor, all board members agreed that they were a part of that consensus.

City-DDA Parking Contract: Coda – Friday Morning MBC Meeting

Early Friday morning, April 8, the two mutually beneficial committees met again. It was intended as a replacement for the meeting the following Monday. Councilmembers Christopher Taylor, Margie Teall and Carsten Hohnke were greeted with the news that the DDA board members had reached a consensus that they were not prepared to meet the council’s request for the 16-16-17.5 scenario. So the Monday, April 11 meeting was put back on the calendar. [Later on the evening of April 11, the council is due to receive a presentation on the city administrator's proposed budget for fiscal year 2012, which starts July 1, 2011.]

Roger Hewitt stressed that he’d already gone back to his full board twice with the council’s request – in fully public settings – after first consulting with his full board publicly at a retreat. He urged the council committee members to do the same with their council colleagues. For her part, Teall said that the lower the percentage-of-gross revenues in the contract was, the more likely it was that the city would come back to the DDA and ask for additional money. Hohnke, who was participating by speaker phone, seemed piqued that Sandi Smith’s position was not supportive of the council committee’s position – she serves on both the DDA board and the city council. He asked pointedly asked what “councilmember Smith” thought.

Smith reiterated the same point that she’d made at the DDA board meeting, saying that the parking fund balance on the 16-16-17.5 scenario was too precarious, and that on her half-and-half compromise – 16% in the first five years and 17.5% in the second five years – the parking fund balance was able to eke out enough of a cushion that she felt more comfortable with.

At the next mutually beneficial committee meeting on Monday morning, April 11, the committees are expected to settle on a percentage-of-gross figure to present to the city council, which could see a vote as early as the council’s April 19 meeting.

DDA Lease Renewal

At its April 6 board meeting, the DDA’s only action item was an authorization to sign a new lease for its office space.

Under terms of its current lease, which expires on June 30, 2011, the DDA pays $26 per square foot for 3,189 square feet of office space located at 150 S. Fifth Ave. Under terms of the new lease, the DDA would pay $16.75 per square foot in the first year of the five-year deal, for a total of $53,415. After the first year, the amount would increase to $17.25, $18, $18.75 and $19.50 per square foot. There’s an option for an additional five-year term.

Mayor John Hieftje had announced at the April 4 city council meeting that he’d be inviting the DDA board to consider moving the DDA offices to newly renovated space in the city hall building. But at the Wednesday DDA board meeting, he indicated that he’d discussed the lease with DDA board member Roger Hewitt and understood that securing just a one-year renewal of the lease would mean agreeing to the less favorable terms of the current lease for that year.

In introducing the item to the board, Roger Hewitt noted that the DDA staff had reviewed alternative spaces, using the services of a broker, but had ultimately been able to negotiate a new lease with the current landlord, Weinmann Block LLC. Alluding to the mayor’s offer announced at the city council meeting on Monday, Hewitt noted that if there was a desire to move out of the space before five years is up, they had the right under the terms of the new lease to sublet the space.

Gary Boren chaired the meeting, because the board’s chair, Joan Lowenstein, was joining the meeting by conference call. And Boren held off on taking a vote on the matter until the mayor could return to the table – he’d left the meeting to take a phone call.

On his return, Hieftje indicated that he understood the circumstances and was willing to support the five-year lease at the DDA’s current location.

Outcome: Hieftje voted for the five-year lease extension, along with the rest of the board. Newcombe Clark recused himself.

Communications, Committee Reports, Commentary

The board’s meeting included the usual range of reports from its standing committees and the Downtown Citizens Advisory Council. Every board meeting also includes two opportunities for public commentary – one near the start of the meeting and the other at its conclusion.

Comm/Comm: Library Lot, Development Process

Ray Detter, reporting out from the Downtown Citizens Advisory Council, and John Splitt, reporting out from the board’s bricks and money committee, both noted the termination of the RFP process for the future use of the Library Lot, which the city council had voted on at its meeting two days earlier on April 4. [Chronicle coverage: "Column: Library Lot from Bottom to Top" and "Ann Arbor Council Focuses on Downtown"]

Detter said that “no tears were shed” when the CAC discussed the issue at their meeting the previous evening, which was attended by Ward 1 city councilmember Sabra Briere. [Briere also attended the DDA board meeting on Wednesday.] Detter said that the CAC supported the idea that the DDA would lead the planning process for the rectangle bounded by Ashley, Division, Liberty and William streets, which includes the Library Lot. That planning process was authorized by a city council resolution also passed at the council’s April 4 meeting.

The rectangle identified as the area of focus for the planning process reflected an amendment undertaken by the council at its Monday meeting. In reporting news of the unanimously-passed city council resolution, Roger Hewitt expressed encouragement that it was something to be referred to the DDA’s partnerships committee and that it had been an important point of the mutually beneficial committee negotiations. Mayor John Hieftje said it was a matter of prioritizing which parcels would get addressed first.

But board member Newcombe Clark questioned the narrowing of the focus – the original intent had been to take a comprehensive look at all of the city-owned parcels in the DDA district. He wanted to know why the specific area had been chosen.

Sandi Smith told him that it was about getting a council consensus. She noted that on the same evening, the city council had received a presentation on another downtown parcel, 415 W. Washington, which has its own process already. The sense of the city council, Smith said, was that it did not want to have the DDA start coming up with ideas for parcels that had processes that were already in place. She also said she felt that the rectangle of focus contained the greatest possibilities for development.

Clark wondered if there had been any discussion on “viability.” As an example, he said that given the zoning, size, geometry, cost of construction, demand, and rents in the area of the Fourth and Catherine lot, that might turn out to the most viable lot with respect to the goal of adding property to the tax base. He compared that with the Palio Lot, which is cramped, or the old Y Lot, where it might be difficult to reach an agreement on price – given that the city wants to recoup the money it paid for the property. He asked if any thought was given to the opportunities of all 16 of the city-owned downtown parcels, beyond the political consideration.

Clark said from what he understood of the situation, the only difference between this proposal and the 3-Site Plan is that it includes more sites. [The 3-Site Plan was a DDA effort in 2005 to develop city surface parking lots, including lots at First & William, First & Washington and the Kline’s Lot on the east side of Ashley Street, between William and Liberty. The concept underpinning the 3-Site Plan was that parking could be decoupled from development – build a parking structure at First & William and free up the other two sites for development without the constraint of building on-site parking. The 3-Site Plan was opposed by advocates for a greenway, and ultimately never received a vote by the city council.]

Smith said it is the DDA’s job to communicate the fact that none of this is happening in a vacuum and that whatever they undertake, they can’t ignore what is outside the rectangle. Clark wondered if he’d get his hand slapped if he began discussing in committee the forces that were operating outside the rectangle.

Hieftje assured him that he would not get his hand slapped for suggesting opportunities outside the box. He described the narrowing and prioritization of focus as the product of a legislative compromise. Clark quipped that he didn’t feel like he was doing anything if he didn’t get his hand slapped. Keith Orr noted that he felt like that the rectangle was the area that the DDA was focusing on anyway. Splitt said he appreciated the narrower focus.

Comm/Comm: DTE to Build New Substation

Paul Ganz, a DTE regional manager for an area that includes Ann Arbor, along with Michael Witkowski, a DTE engineer, presented the electric utility’s plans to invest $10 million in building a new substation in Ann Arbor, to meet increased demand for electricity. It will serve parts of downtown Ann Arbor. [Ganz last appeared before the DDA board on Sept. 1, 2010 to present them each with a commemorative cross-sectional slice of an old electrical cable that had been replaced as part of the construction of the new underground parking garage.]

Ganz described how a new substation needs to meet three criteria: (1) it must be in the center of the load; (2) land must be available; and (3) the land must be acquirable at a market price. He said that DTE had been working on it behind the scenes for a few years, and was now ready to roll out the plan.

Witkowski told the board that the area of focus for the new substation would be the Ann Arbor service center located at Huron River and Broadway. Currently, he said, the downtown Ann Arbor area is served by three substations – Argo, Burton and Hoover. He noted that the University of Michigan was always growing and that new projects like Zaragon Place II and 601 S. Forest meant that demand for electricity continued to grow.

Witkowski listed out a number of new projects that have been built or are expected to be built that would add around 20 MVA (megavolt amperes) of new load. The existing three substations have 4.8 kV circuits and are typically limited to 4 MVA of load. Other substations outside the central area, Wikkowski said, have 13.2 kV circuits, which can handle around 9 MVA of load. The idea is to add another 13.2 kV substation – the Buckler substation, which will be located at the Ann Arbor service center just north of the Huron River, and south of Canal Street, near the Broadway bridge.

DTE began internal planning in 2008, plans to break ground in the fall of 2011, and hopes to have the new substation up and energized by the spring of 2013. It will come before the Ann Arbor city planning commission sometime in May 2011. In 2013, he said, 601 S. Forest will come online, and DTE wants to be ready for that. The new substation will give DTE more flexibility, he said, and will allow the jumping of circuits during outages, so that coverage can continue to be provided.

In response to a question from Sandi Smith, Witkowski explained that a developer may have to share part of the cost of upgrades of electrical service. But Zaragon II, for example, did not result in a payment by the developer. The project was just under the amount of additional load that would have required a developer share.

Comm/Comm: Underground Parking Garage Construction Update

John Splitt reported on the recent incidents at the construction site of the underground parking site on South Fifth Avenue. [One was a breach in the earth retention system and the other was a sinkhole on the opposite side of the site. See Chronicle coverage: Column:Library Lot from Bottom to Top]. Splitt said that the construction management company, The Christman Company, had taken action and determined that there was no immediate danger, and the site is structurally sound.

Splitt said that the designer of the earth retention system, Soil and Materials Engineers Inc., and the installer of the system, Hardman Construction, had both inspected the structure. The safety fence surrounding the site has been moved back an extra 10 feet, Splitt reported, to give an additional measure of safety for pedestrians. Ground-penetrating radar had been used to determine if any other sinkholes exist.

The Christman Company will be using swing stages – similar to what window washers use – to allow SME Inc. to get up close and visually inspect each structural column. The investigation will continue at least another week, Splitt said. When the investigation is complete, Christman will allow its workers back in the main hole – meanwhile, work has been continuing on the east dog-leg.

Comm/Comm: Commuter Challenge

Director of the getDowntown program, Nancy Shore, addressed the board to alert them to this year’s commuter challenge, which takes place every May – it’s a way to encourage employees of downtown businesses to think about how they get to work.

She gave the board several reasons why she thinks the commuter challenge is important: (1) location – downtown is an important part of Ann Arbor; (2) jobs – the jobs of the future will be held by people who want to work in a downtown area where they can use public transportation to get to their work; (3) money – over 100 prizes are donated by downtown employers, plus gas prices are high now; (4) fun – there are a lot of different events associated with the challenge.

Comm/Comm: Liberty Square

Reporting out from the Downtown Citizens Advisory Council, Ray Detter said that every residential unit of Courthouse Square, located at Huron and Fourth, had now been inspected and that there were some signs of improvement in the performance of the management company.

Comm/Comm: Field Guide Downtown

As part of his Downtown Citizens Advisory Council report, Ray Detter said that a committee had been established to update the printed booklet “The Handbook: A Field Guide to Living in Downtown Ann Arbor.” He said that seven years ago the DDA had paid for the production of the booklets, but this time around, they would not be asking the DDA for any money. The updated version will become a part of the DDA’s website.

Present: Gary Boren, Newcombe Clark, Bob Guenzel, Roger Hewitt, John Hieftje, John Splitt, Sandi Smith, Keith Orr, Joan Lowenstein (by speaker phone), John Mouat.

Absent: Leah Gunn, Russ Collins

Next board meeting: Noon on Wednesday, May 4, 2011 at the DDA offices, 150 S. Fifth Ave., Suite 301. [confirm date] It’s anticipated that the board meeting will be rescheduled for a different day the same week.

Andy Thomas, being sworn-in as the newest trustee of the Ann Arbor Public Schools board of education at its May 12 meeting. (Photos by the writer.)

Thomas replaces long-time member Randy Friedman, who resigned in April.  The selection of Thomas to the board during last Wednesday’s meeting marks the third change in board membership in the past six months. Thomas’ current term will end at the end of the year, and he – along with trustees Simone Lightfoot, Christine Stead, Deb Mexicotte, and Susan Baskett – will need to be re-elected in November to remain on the board.

Also at the meeting, the district’s achievement gap between white and minority students was addressed from multiple perspectives. The proposed Washtenaw Intermediate School District budget was reviewed, and the board was briefed on the district’s finances, sinking fund summer projects, policy updates, and human resources.

Andy Thomas Selected as New Board Trustee

After presentations were made by five candidates at its meeting on Wednesday, Andy Thomas was selected, seated, and sworn-in as the newest trustee of the district’s seven-member board.

Board Candidate: Presentations

Before Thomas was chosen, board president Deb Mexicotte reviewed the trustee selection process, reminding candidates they would each have five minutes to speak to the board about who they are, and what they would bring to the board. Then, Mexicotte explained, the board would vote, and whoever was selected would be seated, sworn-in, and enjoy full voting privileges. Candidates made presentations in the following order, chosen at random: James Corey, Noah Hurwitz, Victoria Haviland, Jack Panitch, and Andy Thomas.

Corey reviewed his history as an AAPS student, and as a teacher, coach, and dean. He named two events – the Columbine massacre, and September 11 – as making him realize how lucky he is to be an American, and how much he wanted to give back to his community. Highlighting his interest in using technology to improve education, Corey noted that he is among the 30% of Ann Arbor residents who do not have children, but he still cares about high-quality education. As the district’s opportunities, he listed improving communication, involving the community, celebrating diversity, and making decisions more quickly. Corey acknowledged that he does not have a “magic pill,” but wants to be part of making the decisions.

Hurwitz touted his strong commitment to education, and noted that he had also run for the board in 2003 “to give back to the community.” He mentioned fighting for his adopted son to be given opportunities throughout his schooling, while working as a substitute teacher in virtually every school in the district. Also a former AAPS student, Hurwitz described himself now as a lawyer with an emphasis on education law. Due to the current challenges, he argued, he would “work to promote an understanding of the board’s decisions in the community.”

Haviland began her presentation by describing a visit she made to an AAPS classroom the previous week. She described her experience as a teacher and teacher educator as having led her to the “national forefront” of work in designing equitable instruction, including publishing in peer-reviewed journals, and working on a book on the topic. Haviland argued that teachers would appreciate a board member having had a life in education, and that her connections to the University of Michigan, as well as her expertise in equity issues would be assets to the district.

Panitch began by noting humorously that his wife thought he needed his head examined for applying for a board seat for the third time this school year. Saying he has learned something each time around, Panitch described his motivation for wanting to serve on the board as having a stake in maintaining excellence for all, being inspired by the trustees’ selfless service, and feeling a “calling to serve.” Panitch pointed out that, while he is proud to currently wear the mantle of stay-at-home dad, he has 19 years of experience as a tax attorney, with experience in negotiation, litigation, and advising. He also described himself as a “confident, talented guy, but also a team player.” Noting that “nobody can replace Randy Friedman,” Panitch closed with, “Tonight, Ann Arbor may seem like a house divided, but we’ll put it all back together and move on.”

Thomas was the last to address the board, and reveled in the freedom of Wednesday’s presentation topic. He pointed out that the last two times he applied, candidates were asked to present on a very specific topic, but that tonight he would simply speak about “what makes me tick, and why I’ll be an asset to the board.” Thomas pointed to his 25 years as a health care administrator as good practice for working with ongoing declines in revenue. He also mentioned some of his firsthand experience with the district – he has a son at Tappan, and has worked with the AAPS Educational Foundation. In addition to canoeing and playing the viola, Thomas called his work with the Karen Thomas Memorial Fund as one of his greatest passions. The fund, which Thomas began to honor his wife, who died of breast cancer, encourages the reading of classic literature by at-risk elementary students.

As for why he wanted to join the board, just when he is really enjoying retirement, Thomas stated simply, “I feel it is my duty.” In this unprecedented time, he said, the AAPS is at a tipping point, and his experience with budget cuts and cost containment, as well as his commitment to equity and excellence, makes him the ideal candidate. If chosen, Thomas said the board could expect him to be a straightforward, independent thinker without a predetermined agenda, someone who is not afraid to admit when he is wrong, and someone who would push the board to make data-driven decisions. In closing, of serving on the board, he said, “I would consider it an honor.”

Board Candidates: Voting Process and Outcome

After the presentations, Mexicotte again reviewed the process that trustees would use to choose their new member. The voting would be done by paper ballot, she said, and would continue until a candidate received a simple majority, which is four votes. If no candidate achieved four votes in the first round of voting, she added, there would be more discussion, and another vote. If there was still not a majority at that time, trustees would put forth their top two votes, and the top three vote-getters would move on to another round. Mexicotte summarized the process as one that moves on by slowly eliminating those candidates with fewer votes. If there is a tie that cannot be broken after a short recess, she pointed out, she would cast the tie-breaking vote.

Before the voting began, trustees Glenn Nelson and Irene Patalan each thanked the candidates. Nelson encouraged them to stay involved in the schools no matter how the vote went, and Patalan said she was proud of and had learned from all the candidates.

Board treasurer Christine Stead participated in the meeting by speakerphone.

Via speakerphone, Christine Stead asked for clarification on how her vote would be received, since she would not be submitting a paper ballot. Board secretary Amy Osinkski suggested that Stead should give her vote first, since it would be verbal. Stead agreed.

Mexicotte then issued an invitation to vote: “Let us cast our first ballot.”

Board members voted on small, lavender slips of paper, which were then collected and read by Osinski. The votes were as follows: Stead voted for Panitch; Lightfoot and Baskett voted for Haviland; Mexicotte, Nelson, and Patalan voted for Thomas.

Osinski noted that no one had received the majority. Mexicotte opened the floor for discussion, but after a few moments of silence, quipped, ” … or a minute where trustees can collect their thoughts.”

Osinski then passed out pink slips for the second round of voting, which yielded the final decision. As with the last trustee selection that had put Stead on the board, it was the four board officers who voted in the winner – Mexicotte, Patalan, Stead, and Nelson voted for Thomas. Trustees Lightfoot and Baskett voted for Haviland.

Thomas joined the table, sitting down next to the trustee with the longest tenure on the board, Glenn Nelson, and was sworn-in by Osinski. Mexicotte joked, “If you have any questions, just ask Glenn,” and added, “Just kidding – by all means, if you need to ask a question, please do.”

Achievement Gap

Throughout the meeting, references were made to the district’s addressing of the achievement gap between white and minority students.

Dicken “Lunch Bunch” Program to be Reorganized

Near the beginning of Wednesday’s meeting, Mexicotte read a lengthy statement from the board regarding recent controversy surrounding a program at Dicken known as the “African-American Lunch Bunch.” The program was started this year “to provide support and peer mentoring for African-American students who are not achieving at grade level based on state test score results,” Mexicotte said. Following a field trip taken by the program’s participants a few weeks ago, the board has received many angry comments, many of which, Mexicotte said, have “not been civil, or tempered, or well-informed,” and which she said “illustrates just how far some have strayed from the presumption of good will on which the best communities rely.”

Mexicotte went on to admit that, after seeking a legal opinion, it was found that “the ‘Lunch Bunch’ program as it was structured does not comply with board [anti-discrimination] policy or the [Michigan] state constitution, Article 26.” [Article 26 addresses affirmative action programs. It states, in part: "The University of Michigan, Michigan State University, Wayne State University, and any other public college or university, community college, or school district shall not discriminate against, or grant preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public employment, public education, or public contracting."]

Mexicotte stated that the program would be reorganized, and that “the administration and the board will also create, disseminate, and implement clear guidelines regarding compliance with the board’s anti-discrimination policy and state law to ensure that [Dicken principal Michael] Madison and all administrators and district employees understand and comply with all applicable policies and laws.”

Dicken “Lunch Bunch”: Public Commentary

One person offered public commentary on the “Lunch Bunch” – Ann O’Connell, an AAPS parent who has served on school PTOs and School Improvement Teams over the past 12 years. She expressed concern that district officials, as well as adults in the Dicken community, did not realize Dicken’s African-American “Lunch Bunch” program was “illegally segregating students by race.”

O’Connell noted that over the years she has been involved in the district, other district or school-based efforts have also have been found to be discriminatory for targeting students based on race or gender. On Wednesday, she urged the trustees, “in the strongest possible terms, to re-think and re-direct the district’s group-focused approach to … closing the achievement gap.”

She argued for the retraining of district staff so they can clearly identify appropriate interventions. “What you have been doing, often with excellent intentions,” O’Connell asserted, “is illegal, it’s immoral, it’s insulting to both girls and to African-Americans to imply that they will not, can not, succeed in a fair educational system.”

“College and Career-Ready Review” Follow-Up Forum

Late in the meeting, Susan Baskett extended a “heartfelt thanks” to the Peace Neighborhood Center, the school board, the superintendent and his cabinet for participating in the College and Career Ready Review held on April 29, and for “working toward getting all of our kids college and career ready.” The Review was an opportunity for AAPS administration, the Board, and the community to come together to review and discuss achievement gap data.  She mentioned that the expectation was only that a few community leaders would attend, but over 85 people were there. Singling out her fellow trustees for a second round of thanks, Baskett said that she sees them, and herself, as bridges and inroads to different, specific communities within the wider district community.

Simone Lightfoot also addressed the review, saying she believed it was important for the district to “own our stuff.” She announced a follow-up forum to take place on May 27, so “we can answer the questions posed, listen, and acquire feedback.”

Fund Balance Considerations

Two of the first briefing items – the third quarter financial report, and the board’s annual review of the Washtenaw Intermediate School District budget – tied together an ongoing board discussion over the district’s fund balance and at what level it should be held. Also brought up was the need to begin working on a renewal of the special education millage that funds a large part of the WISD’s work, but will expire next year.

Fund Balance: Third Quarter Financial Report

Nancy Hoover, AAPS director of finance, and Robert Allen, AAPS deputy superintendent for operations, presented the third quarter financial report to the board.

Hoover noted that there were no major changes to the bottom line, though some revenues and corresponding expenditures were reclassified because they are now coming from the federal government instead of the state.  Trustee Glenn Nelson asked if anything had happened since the report was generated that the board would otherwise not hear about until the district’s audit. Hoover said, “No, this is the last change we have to make that we are aware of.”

Allen then took to the podium to lead the board through the budget trends evident so far this year, and to compare this year’s spending with that of the 2008-09 school year. He asserted, “We are pretty much on track to where we were last year at this time.”

Allen then pointed out another thing that has not changed: the projected deficit of $7.58 million. He reviewed the fund equity balance he had previously presented to the board, highlighting that the district has spent down $12 million of it over the past two years. Allen said even though the district had been “holding the line on expenditures, and buying only what is necessary,” it looked like the target of $2.7 million in mid-year budget reductions was not going to be reached; in fact, he said, “we’d be very happy to get to $1 million in reductions.”

Andy Thomas asked about the discrepancy between $2.7 million and $1 million: “In what areas were you not able to realize the savings you’d hoped for?” Allen pointed to overtime as a unmitigated cost, saying, “If you have to have coverage, you have to have it.”

Christine Stead asked several questions: 1) if there was a possibility of fund equity increasing, 2) what percent of the current budget is reflected in the current fund equity balance, and 3) if Allen could describe what would happen if the district spends down all of its fund equity and has to borrow money.

Allen answered that the major source of the district’s revenue is state aid, and that until the economy starts to rebound, he does not see fund equity increasing. The current fund equity balance, he continued, was 14.2% of the district’s budget at the end of last year, and will be around 11% or 12% at the end of this year. While reassuring the board and public that the district is preparing its budget for the worst-case scenario so that fund equity will be preserved, Allen briefly described how AAPS could borrow money from a state bond fund at a low interest rate if needed. He also pointed out that the interest expense would become another operating expense. Irene Patalan added that the rating the district gets from its auditor would affect its interest rates.

Both Nelson and Mexicotte offered support for the idea of maintaining a larger fund equity balance, in light of the current political climate. Nelson pointed out that this year there will be a major contested election at the state level, and that well-known correlations with election cycles have shown that good news in terms of state funding may hold until the election, but that major cuts often follow an election.

That’s because newly elected officials try to get all the bad news out the way in their first few months in office, to position themselves best for re-election. Mexicotte concurred, saying that it’s possible that even if the state per-pupil funding is not reduced by $300 initially – as the worst-case scenario in the district’s proposed budget contemplates – larger cuts may come down the line, which is what happened this school year.

Allen closed by saying that “you have to build in a little extra” in case the student count or the foundation allowance is lower than anticipated. “What’s gotten lost,” he asserted, “is that we’ve always faced a structural deficit, and though we were able to do some things to lessen the impact, this problem is not fixed until the structural deficit is addressed, and it has yet to be addressed.”

Fund Balance: WISD Budget and Special Ed Millage Renewal

Christine Stead, who participated in the May 12 meeting via phone, had prepared a review of the WISD budget, after she and Nelson had met with WISD staff in April. However, “because of the awkward nature of presenting by speakerphone,” Nelson said he would make the presentation.

He began by pointing out that state law requires the budget of each intermediate school district to be reviewed by its constituent districts annually, which he described as “a good mandated function.” He explained that the board needed to respond to WISD with any recommendations by June 1, and that WISD is required to consider the board’s input in approving its final budget.

After giving a general overview of WISD’s proposed budget and fund balance, Nelson zeroed in on the special education fund, saying “it’s really important to understand as a preview of what’s coming” in terms of the district’s future budgets. Explaining that WISD’s general fund revenues are declining alongside declining property values, he noted that next year, WISD’s fund balance will drop from $26.7 million in 2009 to only $3.6 million. Nelson described $3.6 million as “very close to the zero axis.” “Their fund balance will be gone after this year,” he cautioned.

In addition, Nelson pointed out, a portion of the most recent special education millage will expire after next year, requiring major cuts in WISD’s payments to AAPS for special education services in 2012. Nelson expressed concern that cuts would then need to be made in the general fund to make up for the lack of funding for mandated special education services, saying, “The implications are huge for the entire student body.”

In discussing the 2011-12 budget, AndyThomas asked about the potential impact of a failed renewal of the special education millage. Nelson suggested that AAPS should be prepared to expect a 8-9% $8-9 million reduction in special education funding if the millage were passed at the same rate as it currently exists, and a 12-14% $12-14 million reduction if it fails completely. He added that this would be in addition to an increase in employer retirement system contributions, higher yearly costs in general, and likely another decrease in the foundation allowance from the state. About the impending millage renewal, Nelson said, “I’m not sure if … I’m confident, but we do have to make the case and make it well.”

Superintendent Todd Roberts added that if the millage rate were to be increased, it’s possible that WISD funding of AAPS special education services could remain reimbursed at 82%, as it is now.

Stead emphasized the importance of maintaining fund equity in light of these upcoming issues, and offered, “We have to continue to be creative, but we may run out of creative ideas.” She then reminded the board that at this time, “our obligation is to review the budget and make suggested changes.” Deb Mexicotte pointed out that the board has sent comments in the past, and reminded everyone that any decisions about a new millage would need to be made countywide.

Nelson pointed out that state law says a millage could only be called in May, August, or November, but that the current millage had been passed as part of a special election held in September of 2004. He then added that, “The discussion of dates is in its infancy now.”

Consent Agenda: Transportation Item Removed

There was no discussion of the items on the consent agenda, which included the spring grant awards presented at the last regular meeting, as well as four sets of minutes.

A proposal to consolidate busing services with other districts across the county, which had come to the board as a first briefing item at its last meeting, had also been listed on Wednesday’s agenda as a second briefing and consent agenda item. However, on Wednesday, before the meeting, the proposal was pulled off the agenda.

When queried by The Chronicle, board president Deb Mexicotte said simply that the item was not ready for review. In the board packet, superintendent Todd Roberts wrote that, “Dave Comsa [AAPS assistant superintendent for human resources and legal services] and the legal counsel for the WISD are working on the language for the resolution that the board will adopt if the board approves moving forward with joining the county-wide consolidation of transportation.”

If the WISD transportation consolidation does not come to fruition, or AAPS decides not to join the effort, the district would have until the end of the school year to decide on privatization of transportation services, whether or not a contract is reached with current AAPS transportation employees.

Outcome: The consent agenda, without the transportation consolidation item, was unanimously approved by trustees Nelson, Mexicotte, Lightfoot, Patalan, Stead, Baskett, and Thomas.

Action Items

The board took direct action on two items Wednesday night, approving a resolution for a public hearing on the 2010-11 budget, as well as agreeing to support the state’s second attempt at winning a grant through the Race to the Top federal education initiative.

Action Item: Budget Hearing

Deb Mexicotte explained that, by law, the board needs to hold a public hearing on the annual budget each year.

Glenn Nelson read the notice of public hearing, which states that the hearing will be part of the next regular board meeting on May 26, and that copies of the proposed budget can be retrieved from the AAPS board office for public review. The notice also states that the “property tax millage rate proposed to be levied to support the proposed budget will be the subject of this hearing.” He then read the resolution calling for the hearing. A memo from Robert Allen, AAPS deputy superintendent for operations, details that the first briefing and public hearing on the proposed budget, as well as the first briefing on the millage resolution, will take place on May 26, but that the final approval of the 2010-11 budget, as well as the millage resolution, will not take place until June 9.

Outcome: The resolution calling for the budget hearing was moved by Nelson, seconded by Patalan, and unanimously approved by trustees Nelson, Mexicotte, Lightfoot, Patalan, Stead, Baskett, and Thomas.

Action Item: Race to the Top Commitment

Roberts introduced a resolution seeking board support of a second Memorandum of Understanding (MOU) between AAPS and the Michigan Department of Education regarding Michigan’s application to round two of the federal Race to the Top (RTTT) grant competition. He noted that the MOU “walks through various areas that state and local school districts would be responsible for,” but that would only go into effect if the state is awarded RTTT funding.

Michigan applied for round one of funding in January, and was denied. However, in order to make the state more competitive, state legislators passed a flurry of legislation during the application process that local school districts are now responsible for upholding, even without having won the additional RTTT funding.

Roberts drew the board’s attention to page five of the MOU, which begins the outline of the scope of work, and mentioned that this MOU is structured similarly to the one from round one. He also mentioned an example of something that is currently being put in place as a result of the RTTT legislation: a countywide data system to support instruction.

Baskett asked if there were any major changes, as the MOU did not look that different from last time. Roberts answered that the language in section D of the state reform plan, an element called “Great Teachers and Leaders,” was loosened regarding the use of teacher evaluations, and gave more power to teacher bargaining units in terms of determining teacher evaluations. Roberts noted as well that the Ann Arbor Education Association, the local teacher’s union, did sign off on this MOU, whereas they had not agreed to the MOU in round one of the application.

Baskett also asked if Roberts was able to see the actual application this time around. During round one, the application was still being written when districts were asked to sign MOUs in its support. Roberts acknowledged that, this time, he had been given the opportunity, but had not read all of the 500 pages. He did confirm, though, that the opt-out language is the same. That is, he said, AAPS can opt out of the arrangement “if it’s costing us more than we’re getting or it’s not working for us.”

Lightfoot again registered her distaste of RTTT, saying that while she would again support this MOU, “it is with a frustration at the public policy process.” She noted that she did not want to cut off the possible resources that could be brought to the district if Michigan is selected a winner this time around. Roberts agreed that, with or without the funding, the five pieces of new legislation would impose requirements on the districts: “It is that Catch-22.”

Mexicotte read the “Resolved” section of the resolution supporting the MOU, which states that AAPS will support the MOU, but that it can “withdraw … without penalty” if it is determined that it is not in the district’s interest to participate in the state’s reform plan.

Outcome: The resolution in support of the MOU between AAPS and the Michigan Department of Education was unanimously approved by trustees Nelson, Mexicotte, Lightfoot, Patalan, Stead, Baskett, and Thomas.

Sinking Fund Improvements

Also brought before the board for a first briefing were four bids for facilities improvements to be funded from the 2010 sinking fund. Randy Trent, AAPS executive director of physical properties, presented the bid award recommendations to the board for asphalt paving, roof replacements, ADA site improvements, and an energy conservation program.

During the discussion, Glenn Nelson noted that the sinking fund was a millage passed by the community, which funds improvements so that AAPS does not need to use money out of the general fund. Nelson also thanked the community for the passing the millage, pointing out its importance to the preservation of general fund money for instructional services. Trent confirmed that costs that have historically been paid for by the capital needs fund (which takes money out of the general fund) are now covered by the sinking funds.

Sinking Fund: Asphalt Paving

This summer, parking lots will be repaired at Angell, Carpenter, Clague, Scarlett, Slauson, Tappan, and Thurston, according to Trent. The biggest of these projects, he said, was Thurston, which will be redone completely to separate buses, cars, and pedestrians better. Trent put up a slide with a drawing showing how Thurston will look when completed – the main difference will be that a second loop will be created to separate buses from cars. In the new design, which he called a “safer and streamlined approach,” the handicapped parking will be moved, and pedestrians will not have to cross any traffic.

Regarding the paving projects, Trent also mentioned that bids received by the district were 25% lower than anticipated. All the recommended companies have been hired by the district before, and have great references, he said. After reviewing eight bids, Trent recommended the following contracts for board approval: ABC Paving ($145,200), Cadillac Asphalt ($214,937), Nagle Paving ($93,170), and T&M Asphalt ($23,190).

Sinking Fund: Roof Replacements

Trent stated that this summer, roofs will be repaired at Pioneer, Forsythe, Slauson, Mitchell, Clague, Northside, and Huron. Seven companies bid on the work, and two were chosen as recommended contractors. Trent added that these bids contain more inspections, double the warranty, and more insulation than previous ones, and expressed that working with Firestone as the approved supply vendor had gone well. He recommended that the board approve two contracts for roofing to: Advance Roofing ($1,062,848), and Royal West Roofing ($87,300).

Sinking Fund: ADA Site Improvements

This summer, Trent said, site improvements to bring facilities in line with the Americans with Disabilities Act (ADA) will be made at Allen, Haisley, Scarlett, Stone, and the transportation building. Three companies submitted bids for the work, and Trent recommended one of them be given the contract: GM & Sons ($73,800).

Thomas asked for confirmation that each building is bid out as a separate project, rather than all the work of one type being consolidated in a multi-site bid. Trent confirmed that each site was bid independently, and that the bid awards he is recommending are to the lowest qualified bidder on each individual project. This is why, he pointed out, the paving and roofing bids are spread out among more than one contractor. In the case of the ADA improvements, Trent said, GM & Sons came in as the lowest bid for each of the five buildings needing work, which is why it was the only recommended contractor in that category.

Sinking Fund: Energy Conservation Program

Trent referenced a $400,000 budget reduction for “energy savings” listed in the district’s proposed 2010-11 budget as impetus for hiring a company to help AAPS streamline its energy usage. He explained that the district’s legal counsel recommended bidding out the service. Five bids were received, and three companies were interviewed.

Trent then explained how the interview committee came to the unanimous decision to recommend Johnson Controls Inc. (JCI) over the other top contender, Energy Education Inc. (EEI). He reviewed several points: JCI has already done successful energy reduction work in the district; with JCI, AAPS is not penalized for saving more than targeted (EEI charges a higher fee if the district hits a certain savings mark); and JCI “has a nice addition of a student involvement piece.”

Describing JCI’s proposal as a “top-down effort” that starts with the superintendent and works through the whole district, Trent said that over 10 years, “the possible savings [reaped by implementing JCI's program] could go up to $12 million.” He also noted that, “Every dollar we are not spending on a utility can be put into a classroom.”

Trent recommended awarding a four-year contract to JCI, in the amount of $273,193 annually.

Sinking Fund: Historically Underutilized Businesses

Throughout the bid presentations ran a conversation between board members and Trent regarding the hiring of historically underutilized businesses (HUBs) for work in the district. HUBs are businesses that are minority or woman-owned. At the beginning of the discussion, Lightfoot asked  Trent to note the HUB status of any of the contractors he was recommending.

In the first bid description, when Trent noted that none of the recommended paving contractors were HUBs, Lightfoot jumped on it: “I keep asking that question, and I’m getting no’s. I’m looking forward to getting some yeses.” In the next bid description regarding roofers, Baskett echoed Lightfoot’s concerns, pointing out that “there has been a desire among some members of the board to foster relationships with HUBs.” She asked Trent if he had provided any incentives or encouragement to HUBs to apply, and whether the district has gotten any feedback from HUBs about why the district’s attempts to foster relationships with them “have not gone anywhere.”

Trent pointed out that reporting HUB status on the bids is optional, and that some businesses simply choose not to self-identify as HUBs, even though they are, such as GM & Sons, the minority-owned business recommended as the contractor for ADA improvements. He also pointed out that there is no official policy in place to recruit HUBs, but that he has coordinated networking events, and sent out RFPs to minority-owned businesses. Trent concluded, “We can’t make them bid.”

Baskett conceded that, while few of the current contractors being recommended have HUB status, those companies could always subcontract with HUBs. Trent confirmed that this could happen, such as with the Thurston project, where the main contractor could subcontract certain aspects of the project, such as lighting or landscaping. He also suggested that he could send letters to the HUBs who have worked for the district in the past to get their feedback. Patalan added that the planning committee will look at this issue, and consult with the district’s legal counsel.

Policy Updates

Both the policy and planning committees of the board have been engaged in ongoing review of board policies. At Wednesday’s meeting, 12 policies – 5550, 4020, 4050, 4100, 4400, 4500, 4600, 5120, 5130, 6140, 3000, and 3050 – were presented at first briefing. Most parts of these policies were either submitted for re-authorization as is, with no changes needed, or with only minor wording changes meant to bring the policy in line with current district practice, procedures, or department names. [.pdf file of revised policies]

The more extensive proposed policy changes were as follows:

• In 5550.R.01, Chronic Health Conditions, ADA language was added;
• In 4040, Anti-Harassment of Employees, “electronically transmitted acts” added;
• In 4050.R.01, Family & Medical Leave Act, military family leave added and defined;
• In 4050.R.03, Personnel Files, long-term storage of files, and disposition of files upon employee’s death addressed;
• In 4050.R.06, Employee Background Checks, fingerprinting and background check processes updated, and language added about fingerprinting results expiration date;
• In 4100.R.01 & R.02, Hiring Procedures, application and reporting processes updated; and
• In 4500.R.01, Safety, Injuries, and Emergencies, language added to be sure student health information is appropriately disseminated, and sign-in requirement added.

In addition, three of the policies were newly drafted:

• Policy 5120, Middle School Attendance, “articulates attendance guidelines … and provide for problem-solving with parents/guardians when attendance is inconsistent and/or detracting from school success;”
• Policy 5130, Middle School Retention, “provides a protocol for administration, faculty, and families when grade retention is under consideration in grades 6-8;” and
• Policy 6140, Homework, establishes guidelines for teachers, families, and students regarding the purpose, nature, and expected time commitment of homework.

Both Baskett and Patalan submitted charts summarizing the proposed policy changes their committees were suggesting. Baskett added, “We believe the chart is very clear, but we’re open to any questions … or feedback.” She highlighted the homework policy for parents in the community to note.

Patalan also thanked board secretary Amy Osinski, who, she said, “has her eyes focused on policy, and does a good job.”

There was no discussion on any policy items, which will come back before the board as second briefing items for approval.

Human Resource Services Update

Each year, the AAPS human resources department updates the board on any new developments, as well as providing a snapshot of retirements, resignations, and unpaid leaves for the coming year. As new trustee Andy Thomas confirmed during the first part of the presentation, Wednesday’s presentation was for information only, and no vote or approval by the board was required at that time.

HR Update: Teacher Evaluation Process

Cindy Ryan, AAPS director of human resources, updated the board on the process used in teacher evaluation. “We’re in the process of working on a new evaluation system,” she said, and identified one of the big concerns as how to integrate the Race to the Top (RTTT) mandates, such as integrating measures of student growth into the teacher evaluation process.

Ryan explained that, a year ago, a committee was formed through collective bargaining to assess models for teacher evaluation. Of the seven or eight models the committee reviewed, they decided they most liked the “Framework for Teaching” model created by Charlotte Danielson, and are moving forward with tweaking that model so that it would meet RTTT requirements and the needs of the district.

Several trustees asked how the Danielson model would intersect with specific district needs while ensuring that AAPS is in compliance with legal requirements, such as annual evaluations.

Ryan assured the board that the model could be embellished, or amended as needed, confirmed that it could be adapted for all Ann Arbor Education Association members, and called the work of the evaluation committee “a big undertaking.” Dave Comsa, AAPS assistant superintendent for human resources and legal services, added that there is a collaborative group in Lansing working to develop teacher evaluation models that will incorporate RTTT.

Comsa continued, saying that the district was “somewhat working in a vacuum” without a lot of guidance coming from the Michigan Department of Education on how to interpret RTTT requirements. Still, he said, AAPS is “ahead of the curve by implementing this evaluation committee,” and that the district can make a strong argument that it’s already in compliance.

Thomas asked about the timeline for getting this new evaluation process embedded in the contract as it’s currently being negotiated, and Ryan said it’s possible that the new evaluation process could be in the next contract. Mexicotte added that the contract can always be amended with a Memorandum of Agreement (MOA) at any time.

HR Update: Demographic Data

Alice Chamberlain, AAPS assistant director of employment services, presented the district’s current demographic data on retirements, resignations, and unpaid leaves for 2010-11, and pointed out that the district uses this data directly to arrange staffing.

In total, Chamberlain said, the district is expecting 58 people totaling 56.2 FTEs to leave the district next year, and broke them out by subject, and grade level. Of all the positions, she noted that the two positions opening up in the hearing impaired program may be difficult to fill.

Nelson noted that retirement legislation is being developed at the state level, and said that counting on this number of retirements is like, “saying ‘there’s no rain yet’ before a thunderstorm.” He continued, asking if it was accurate to assume major changes in these numbers if legislation including a retirement incentive should pass. Chamberlain allowed that if retirement reform passes, “these data very well could change, and the change could be radical.”

[Retirement reform legislation, including a retirement incentive, did pass in both the house and senate late last week, and awaits signature by Gov. Jennifer Granholm.]

HR Update: Professional Development

Jane Landefeld, director of student accounting, Michelle Madden, math/science curriculum coordinator K-8, and Chuck Hatt, literacy/social studies curriculum coordinator, presented an overview of the professional development (PD) offered in AAPS.

Landefeld explained that PD is offered to teachers as part of their contractual obligations, and therefore all teachers are required to participate. Much of the PD is offered during the school year on days without classes, but some PD is also offered after school or over the summer. In total, Madden added, there are over 1,400 sessions and workshops offered to district employees each year, to “grow teacher-leaders.” These sessions are often used to introduce new curriculum or interventions, she explained. Hatt added that PD can be adapted as needs arise, and that it can be used to continually improve and adjust instruction.

Nelson asked whether national efforts to standardize curricula match up with Michigan’s curriculum. Madden answered that the national efforts are to devise standards, not actual curricula, and that AAPS outcomes standards are higher than both those of the national core standards project, and those of Michigan. Madden added that the national core curriculum standards project “will not happen overnight,” and is “very ambitious.”

Association Reports

At Wednesday’s meeting, the board received reports from three of its associations – the Youth Senate, the Ann Arbor Parent Advisory Committee on Special Education (AAPAC), and the Parent-Teacher-Organization Council (PTOC). The Ann Arbor Administrators Association (AAAA), the Ann Arbor Education Association (AAEA), and the Black Parents Student Support Group (BPSSG) did not report at this meeting.

Ann Arbor Parent Advisory Committee Report

Scott White reported for the AAPAC, and began by describing a bit about Williams syndrome, the disease that affects his daughter, Lauren. He noted that the week of the board meeting was the first-ever Williams syndrome awareness week. In deciding where to send Lauren for school, White said he has become an advocate for increasing opportunities for peer mentoring in the district. Through this work, he has gathered information on successful programs, and he reported at Wednesday’s meeting that a successful peer mentoring class has begun at Clague Middle School this year, which he called a “happy beginning” toward “helping students see abilities and not just disabilities.”

White also said AAPAC is pleased that the reorganizations taking place in the district’s Student Intervention and Support Services (SISS) department will lead to a full-time position for Peer-to-Peer programming and another for Adapted Physical Education. Unfortunately, White said, Steve Schwartz will be decreasing his volunteer hours for the fourth-grade disability awareness workshops, and he encouraged the board to ensure continuation of the workshops.

PTO Council Report

Co-chair of the PTOC, Donna Lasinski, began by reporting that the council has been making a concerted effort to take a look at what can be done as a community to make a difference at the legislative level. She noted that the PTOC advocacy committee now has 35 members, and is growing each week. The committee has crafted talking points around their four stated goals: (1) guaranteeing that school funding levels are set by the start of the fiscal year; (2) ensuring that schools are funded at the level of program cost, not dollars available; (3) developing a stable and secure funding model for schools; and (4) prioritizing education funding over other state needs. These goals reflect the PTOC’s perception, said Lasinski, that “no state has ever dug itself out of an economic hole by building more prisons.”

Thus far, advocacy efforts have targeted both elected officials, and those running for office in November. Next, the committee will be initiating a postcard campaign to give parents a chance to say why education is important to them. And finally, the PTOC, based on feedback from some of the legislators with whom they have met, has decided to attempt partnerships with other similar parent groups from parts of the state with less supportive elected officials.

Youth Senate Report

Youth senators Priya Menon and Nikila Lakshmanan suggested in their report that off-campus lunch privileges currently enjoyed by some Ann Arbor students  should be extended to all high school students, or, alternately, offered as a reward to students with no unexcused absences or tardies. [Community High School has an open-campus policy.] Being able to leave for lunch, Menon and Lakshmanan argued, can help prepare students who go onto college “to adjust to the new surge of independence that comes with a new environment.”

The youth senators also invited everyone to participate in a walkathon to fight poverty, wished all students good luck on AP exams, and reported that Pioneer High music students are concerned about the possible lay-off of their orchestra director, Jonathon Glawe.

Committee Reports and Agenda Planning

The board has two standing committees – performance and planning – through which many items on the board’s agenda get a first look. Each board member except for the president is assigned to one or the other – Susan Baskett and Glenn Nelson sit on the performance committee, while Irene Patalan, Christine Stead, and Simone Lightfoot sit on the planning committee. All performance and planning committee meetings are open to the public. Also at each meeting, trustees can put forward items they would like to have considered on agendas for future meetings.

Performance Committee Activities

Baskett reported that her committee reviewed many of the first briefing items coming to the board for Wednesday’s meeting, including the WISD budget, third quarter financial report, and a “slew of policies.”

Planning Committee Activities

Patalan reported that Trent had walked her committee through the beginning of spending the 2010 sinking fund money, and that some of the first briefing agenda items reflected this discussion. She pointed out that the planning committee has also been engaged in policy review.

Planning for 2010 Board Retreat

Mexicotte announced that there would not be an organizational meeting of the board this July, since the elections were moved to November. Instead, she suggested, the board retreat usually scheduled for the end of the summer could be moved up to July. The board retreat, Mexicotte explained, is an opportunity for the board to set goals, re-form itself as a board, and move forward with agenda items, and is typically a single-day event. Saying that she would be working with Patalan to set an agenda and talk about facilitation, Mexicotte requested trustees to send their summer schedules to Osinski so a retreat date could be set.

Awards and Accolades

The board devotes time at each meeting to reflect on positive accomplishments in the district, and honor those people who go above and beyond the call of duty.

Celebration of Excellence

John Fisher, a physical education teacher at Angell and Pattengill, was honored with a celebration of excellence for his service to his students. He was nominated by Martine Perreault, chair of the PTOC, and a parent of three children who have attended Angell Elementary and who had Fisher as a teacher. Perreault’s nomination lauded Fisher’s emphasis on personal fitness, cooperative games, and innovative inclusions to the phys ed curriculum. She credited him with turning phys ed into “an enjoyable respite in the school day.”

Fisher and many of his family and supporters gathered at the podium for his receipt of the award. He thanked them all, saying, “I’m lucky and I’m blessed … I don’t like my job – I love my job!” Fisher’s mother, who had been standing next to him, then also responded, urging everyone to “do your best at whatever you do.”

Superintendent’s Report

Todd Roberts noted many recent successes of AAPS students and staff, beginning with the high school level, and including the receipt of a Grammy Gold award, and a regatta win by Pioneer High School. Huron High School, he said, had eight students’ work recently published in a book called “Talking Back,” and Skyline High School students placed highly in the recent Special Olympics competition.

Roberts also noted the impressive feat achieved by Community High students and staff, who removed 4,460 pounds of garlic mustard, an invasive species, from natural areas across the district as part of an all-school service project. At the middle school level, Roberts praised Slauson for placing highly in the Science Olympiad, and all the middle schools for becoming “healthy schools.” He also praised many of the district’s teaching staff for individual accomplishments.

Items From the Board

Glenn Nelson mentioned that he had just attended a dinner and dance at the Ann Arbor Community Center, and thanked the community centers for their wonderful work. He also reminded everyone of the “three wonderful art shows” of student work currently going on in town.

Susan Baskett thanked the SISS department for hosting Parent University talks at the Bryant Community Center. She pointed out that over 50 people attended the recent lecture by Dr. Sanchez, and invited everyone to attend the May 24 lecture by Patricia Edwards on reaching non-traditional students.

Christine Stead pointed out that Johnson Controls Inc. did a great job at Skyline High School on April 29 of showing students what they do, and providing some perspective on possible careers for students.

Present: President Deb Mexicotte, vice president Irene Patalan, secretary Glenn Nelson, treasurer Christine Stead, and trustees Susan Baskett, Simone Lightfoot, and Andy Thomas. Also present as a non-voting member was Todd Roberts, AAPS superintendent.

Next regular meeting: May 26, 2010, 7 p.m., at the downtown Ann Arbor District Library 4th floor board room, 343 S. Fifth Ave. [confirm date]

The DDA board talked about more than just the budget. Who was that map man? As the nameplate says, it's DDA board member Keith Orr, who was introducing a draft of a bicycle map that the DDA is working on. (Photos by the writer).

Deliberations covered a range of issues. First, the budget needs to accommodate two major DDA capital projects: the underground parking garage currently under construction; and the Fifth Avenue and Division Street improvements, which are also underway.

Second, there’s a contingency written into the budget for $2 million. The contingency is there in case renegotiation of the parking agreement between the city and the DDA results in a continuation of the $2 million payments made by the DDA to the city for each of the last five years. Continuation of the payments is not legally required under terms of the current agreement, which assigns responsibility for administration of the city’s parking system to the DDA through 2015.

Third, the fund balances of the DDA – which reflect the DDA’s reserves – face a dramatic reduction. That’s an issue that city of Ann Arbor CFO Tom Crawford flagged back in the spring of 2009 during discussions about the construction of the underground parking garage. The concern caused the city council to scale back the size of the garage by 100 parking spaces.

And finally, decisions made by the DDA board over the last year have resulted in re-direction of revenues from two surface parking lots – 415 W. Washington and the old YMCA lot at Fifth and William – to the city of Ann Arbor. That has resulted in the elimination of line items for DDA programs for next year that were in this year’s budget.

Besides the budget, the board also discussed a number of other topics, including development of the Library Lot and results from two parking surveys.

We begin with background on the four funds that make up the DDA budget, and a discussion of reserve levels.

DDA Budget: The Four Funds

The DDA’s budget is divided into four funds: TIF (tax-increment finance), housing, parking, and parking maintenance.

DDA Budget: TIF Fund

Desposits to the TIF fund come from property taxes collected within the DDA district. It’s a tax-increment finance (TIF) district, which means that property taxes are collected on the difference between the baseline value of a property when the district was established and the value of a property after improvements. The Ann Arbor DDA TIF “capture” is on the value of the improvements at the point they are made, and does not include subsequent increases in property value due purely to market forces.

To illustrate how TIF works, consider a property that has a taxable value of $100,000 to start. Suppose the owner builds on the property so that its taxable value is $1,000,000. That $900,000 increment is the amount on which the DDA’s tax capture is based. Now suppose the property adds value at $10,000 a year for 10 years due to ordinary real estate market conditions. So after a decade, it has a taxable value of $1,100,000. Each year, the Ann Arbor DDA’s tax capture is based on the same $900,000. So in the 10th year, the basis of the DDA’s tax capture would not include the first $100,000 or the $100,000 by which the property had increased over the years.

DDA Budget: Housing Fund

The housing fund gets its deposits through transfers from the TIF fund. It was created in 1997, and historically the amount of the annual transfer has been $200,000. At the board’s February 2010 meeting, Sandi Smith summarized activity in the housing fund over the last decade:

Smith reported that in the last 10 years, 23 grants had been awarded and that the average amount of those grants had been around $80,000. Of the 23 grants, 11 had gone to one nonprofit – Avalon Housing. A total of $1.1 million from the housing fund had been obligated, Smith said. The breakdown of those dollars: (i) $400,000 for Village Green’s City Apartments project at First & Washington, contingent on issuance of a certificate of occupancy; (ii) $207,000 for the third year of a grant to Avalon; and (iii) $400,000 to $500,000 for Near North.

The Village Green project Smith mentioned in that summary is a planned unit development (PUD) proposal by Village Green Residential Properties LLC at the corner of First and Washington, across from the Blind Pig, which includes 156 dwelling units and 244 public parking spaces. The city council approved the project on Dec. 1, 2008.

At its May 18, 2009 meeting, the council authorized an extension of terms in order to give Village Green more time to arrange financing. From the cover memo accompanying the resolution:

In order to complete this project the Developer has requested an extension of the term of the Option Agreement until December 30, 2009. Staff recommends approving this extension plus authorization for two three-month extensions at the City Administrator’s discretion. We expect this amendment to provide the developer sufficient time to complete their financing arrangements and close on the sale of the property.

The extension is now covered under the first of the three-month extensions that can be made at the city administrator’s discretion. The city has already factored $3 million of proceeds from the land sale into its financing plan for the new municipal center under construction at Fifth and Huron.

If the City Apartments project were not to go forward, the $400,000 in the DDA housing fund that’s committed to the the project would be freed up, along with the projected $9 million it would take to build the parking deck component of the project.

DDA Budget: Parking Fund

The parking fund gets its deposits from the city’s parking system, which the DDA administers under an agreement with the city. The agreement was revised most recently in 2005, extending 10 years, through 2015. The DDA contracts out the management of the system to Republic Parking. The terms of the city-DDA agreement on parking provide for a $1 million payment by the DDA to the city per year, including an option for the city to ask for up to $2 million in any given year – with the condition that the total amount of payments through 10 years not exceed $10 million.

Rob Aldrich, who was a DDA board member in 2005 when the parking agreement was struck, raised a concern about the possibility that the city would ask for $2 million in each of the first five years of the agreement. From the board minutes of the March 2, 2005 meeting:

Mr. Aldrich asked if it would be possible for the City to draw the full $10 million in the first 5 years; Mr. Solo said yes. Mr. Aldrich asked what would happen in year six, which is to say, would the City be satisfied to receive no further rent for the remaining five years. There was no response to this question.

As it turns out, the city asked for and received $2 million from the DDA for the first five years covered by the agreement. The current status of the negotiations between the city and the DDA to revise the parking agreement has been an ongoing topic for the last year at DDA board meetings, and factored significantly into deliberations on the DDA budget on Wednesday.

DDA Budget: Parking Maintenance Fund

The parking maintenance fund gets its deposits through transfers from the parking fund. The amount of those deposits per year is based on an inspection of the parking structures by an engineering firm, which estimates required maintenance over the next 20 years. That includes fixing rips in protective coatings, and repair of cracks to prevent seepage.

DDA Budget: Fund Balances (Reserves)

The DDA’s 2010-11 budget shows total fund balances dropping from $8,865,473 at the start of the year to $3,414,486 by the end. At Wednesday’s meeting, Roger Hewitt, who chairs the operations committee, attributed the bulk of the drop to down payments on two major capital projects: the underground parking garage at the Library Lot site, and the Fifth and Division streetscape improvements, which are both now underway.

In the 2010-11 budget, those expenditures are listed under “capital costs” in the amount of $2,796,507 from the parking fund and $2,020,753 from the TIF fund.

The DDA 10-year plan forecasts reserve levels dropping to their lowest point of $1,130,000 in the 2012-13 budget year, which is 5.65% of annual recurring expenses. After that, they’re projected to increase, as the new parking spaces being built start to generate revenue and rate increases begin to take effect.

The appropriate level of reserves for the DDA budget was a topic that drove city council discussion when the underground parking garage was approved last year, and ultimately led to the elimination of 100 spaces from the design.

From the Feb. 17, 2009 Ann Arbor city council meeting:

Crawford reported that on looking at the DDA’s financial picture, he noticed that they don’t have a minimum reserve policy. He said he generally used 15-20% as a minimum reserve. In light of the need to maintain adequate reserves, he said that in his view the project is “not affordable with the plans they have.”

The proposed structure would occupy area under Fifth Avenue. But [councilmember Carsten] Hohnke expressed concern that the cost of an extension along Fifth Avenue southward past the southern edge of the library lot all the way to William Street (part of the current plans) didn’t offer commensurate value for the investment. He was concerned that the cost would constrain the DDA in making other needed investments. He said that while there’s no doubt more space is required, he thought that the roughly 770 spaces to be built exceeded what’s required.

Hohnke then proposed an amendment that would slightly reduce the scope of the project, by whittling around 100 spaces off the total through eliminating the Fifth Avenue extension all the way to William Street. Even the reduced number of spaces would represent roughly a 10% increase in the 5,000 spaces currently in the city’s off-street parking inventory, Hohnke said.

Queried by Mayor John Hieftje, Hohnke said that cost savings of removing the 100 spaces would be around $6 million.

At the time, DDA board members were reluctant to accept Crawford’s assessment of appropriate reserve levels – reasoning in part that the city itself had no set policy specifying a reserve amount at that level. From The Chronicle’s coverage of the DDA board’s March 4, 2009 meeting:

[DDA board member, Leah] Gunn recounted how at council’s Feb. 17 meeting Tom Crawford, Ann Arbor’s chief financial officer, had expressed concern about the DDA’s fund balances. She said that the city of Ann Arbor had no policy on fund balances and that she thought the DDA’s finances were perfectly healthy.

However, on the fund balance issue, then-councilmember Leigh Greden wrote in an email sent on March 7, 2009 to Susan Pollay, executive director of the DDA, as well as to DDA board members Jennifer S. Hall and Leah Gunn:

I understand there has been some discussion at the DDA that the City does not have a minimum reserve policy similar to the one Tom Crawford has been recommending for the DDA. In fact, the City DOES have a minimum reserve policy, and has had such a policy – in writing – for years. The policy has been printed in the City’s Budget for years, and reads as follows:

The City shall “maintain an undesignated General Fund balance with a minimum range of 8% to 12%; provided that when necessary use of these funds occurs, subsequent budgets will be planned for additions to fund balance to maintain this standard over a rolling five-year average.”

Tom Crawford has repeatedly urged the City to exceed this policy by maintaining an undesignated General Fund reserve of 15%. Consistent with Tom’s recommendations, the City has exceeded our policy by maintaining an undesignated General Fund reserve of 15-20%. The existence of this policy and our success in exceeding the policy is one of the reasons that TWO ratings agencies upgraded the City’s bond ratings in late 2008. These higher bond ratings result in lower interest rates for bonds issued for City projects – including DDA projects. This is the background for Tom Crawford’s request that the DDA adopt a similar policy requiring a fund balance of 15%.

The policy that Greden cited is No. 7 on a list of 10 short-term financial goals in the city’s FY 2010 budget book.

Budget Discussion

With that background, then, here’s how the budget deliberations unfolded. The topic was broached first during public commentary.

Budget Discussion: Public Comment

Brad Mikus addressed the board about the proposed 2010-11 budget and noted several concerns that led him to conclude that “it’s a tight budget.” Among those concerns was a budgeted total revenue of over $16 million for the parking system, when revenues over the last 12 months had been only $14 million. In addition, Mikus pointed out that the budget relied on an increase in tax-increment finance (TIF) district revenues from $3.54 million to nearly $3.8 million, or by 7%. He told the board that it appeared the budget would only be met if things “worked out exactly right.” He thus encouraged the board over the next 12-18 months to look closely at the actual revenues as they came in.

Board Budget Deliberations: Part 1

Hewitt led off by noting the budgeted drop in fund balance from $8,865,473 at the start of the year to $3,414,486 was due to the two major capital projects started this year: the underground parking garage at the Library Lot and the Fifth and Division streetscape improvements. In the 2010-11 budget, those expenditures are listed under “capital costs” in the amount of $2,796,507 from the parking fund and $2,020,753 from the TIF fund.

Responding to Mikus on the question of TIF  and parking revenue, Hewitt said that the TIF estimates came from the city of Ann Arbor. The increase in parking revenues, Hewitt said, would come as a result of a rate increase that will go into effect on July 1, 2010. [Those increases are part of a series of already-approved incremented rate increases that started in July 2009 and will ultimately see hourly rates in parking structures of $1.10 by 2012.]

Hewitt described how the total reserves over the next three years would be relatively low, reaching their low point in 2012-13. That low is based on the projections of the 10-year plan putting the total fund balance at $1.13 million  – a number that does not include the housing fund balance. After that low in 2012-13, the 10-year projections show total fund balances (minus the housing fund balance) of $2.8 million in 2013-14, $4.5 million in 2014-15, and $10 million in 2015-16. [The housing fund balance is not considered available for other use and is thus not counted in the reserve.]

Hewitt noted that they would be cutting back on some programs, given the “relative tightness” of the fund balances. First, he said, for the next year and possibly for the next two years, transfers to the housing fund out of the TIF fund would be reduced from $200,000 to $100,000. The balances in the housing fund, said Hewitt, would be made up following that three-year period.

The housing fund balance, observed Hewitt, would be about $1.3 million, even with the reduced transfer. Hewitt also observed that historically, the DDA had found it difficult to find places to invest housing fund dollars. Board member Russ Collins noted that it was a way of being “prudent with funds,” as Brad Mikus had suggested during public commentary.

Sandi Smith, a board member who also represents Ward 1 on city council, objected to the strategy on the grounds that there was no mechanism for ensuring that the housing fund balances would be restored as Hewitt had described. She suggested a separate resolution laying out how that would happen. She noted that most of the money in the housing fund was already encumbered in different ways, even though it hadn’t been spent. The unencumbered fund balance, said Smith, was only $200,000. She allowed that it had been difficult to find ways to spend housing fund dollars, but said that it was also important to restore it.

Board member Leah Gunn weighed in, saying that the board could always restore the funding if there were a project where it was needed, if someone brought a proposal to the board. The next couple of years, however, they would need to be “on a diet” in terms of spending discretionary income. For the next couple of years, though, Gunn said she felt it should stay the way it was – reduced to $100,000.

Hewitt, picking up on Smith’s point about the housing funds being encumbered, said that around $400,000 of that was encumbered by Village Green’s City Apartments project at First & Washington, which had no clear indication of when it would be started or completed – the housing fund payment will not be required until certificates of occupancy are issued. Hewitt felt like the board would be past the tight period by the time that $400,000 would need to be paid.

Responding to a query from board member Newcombe Clark via speaker phone, Hewitt said that the DDA’s responsibility was to pay for a 250-space parking structure that will be built on the bottom floors – $9 million upon certificate of occupancy. Hewitt said that for budgeting purposes that money would be needed 2.5 years from now – the time it would take if it were to start immediately.

Besides the $100,000 reductions in the housing fund transfer, other programs would be reduced, said Hewitt, including: Phase II of the energy grant program would be reduced from $250,000 to $0; grants to the four merchant associations would be reduced from $75,000 to $0; travel to the International Downtown Association conference would be reduced by $15,000.

Board member Jennifer S. Hall asked whether those items had been assumed to remain constant, when the DDA board approved the budget for the underground parking garage.

The conversation with Hewitt and Russ Collins yielded some uncertainty about what had been forecast in conjunction with the parking garage, but Hall returned to the idea that promises had been made about what would remain constant. What was it that had changed, she asked, that had resulted in the reductions?

Joe Morehouse, deputy director of the DDA, allowed that one unexpected shift in revenue had been from the 415 W. Washington parking lot, as well as revenues from the old YMCA lot at Fifth and William. [The city council requested and received approval from the DDA board to direct net revenues from those lots to the city. The council's action on 415 W. Washington came at its June 15, 2009 meeting, and action on the Fifth and William lot came at its Dec. 21, 2009 meeting. The ballpark numbers for revenues to the city from those two lots are $100,000 from the Fifth and William lot and $70,000 from the 415 W. Washington lot.]

Hall characterized the DDA’s actions, agreeing to direct those additional revenues to the city, as confirming it “after they asked for it.” She stressed that she wanted everyone to understand why the DDA board was forced to reduce its programs in the coming year.

For her part, Sandi Smith said that the energy grant and the housing fund reductions gave her pause. The $350,000, she said, did not make that big of a difference. She said she did understand that if a proposal came up, money could be moved into the housing fund. With respect to the energy grants, however, she felt it was an essential program. She noted that for Phase II of the program last year, the program had required only $58,000. [Phase I is an energy audit phase, while Phase II is implementation of recommendations from the audit.] Fifteen buildings had installed $138,000 worth of improvements – of which the DDA had paid just $58,000 – which would save $25,000 a year, she said. She emphasized that it was “direct dollars stimulating private investment in the downtown,” and that was core to the mission of the DDA. For that reason, she said, she was reluctant to see that disappear.

Board Budget Deliberations: Restoration of Phase II Energy Grants

Smith thus moved a resolution to restore $100,000 for Phase II of the energy grant program. The motion was seconded by Keith Orr. Weighing in by speaker phone, Newcombe Clark seemed to be in favor of putting all the funds back, including the merchant association allocations. Clark pointed out in the interest of full disclosure that he was no longer president of Main Street Area Association board.

John Mouat drew out from Hewitt the fact that concern for the minimum fund balance had driven the decision, and that all areas of the budget had been examined.

Orr weighed in for reductions in amounts as opposed to outright elimination of the items from the budget. He agreed with Smith that the energy grants were part of the DDA’s  core mission. He also acknowledged his ongoing association with Kerrytown District Association, which is one of the merchant associations that the DDA has historically funded.

Leah Gunn noted that the $9 million for the parking deck in connection with Village Green’s City Apartments project would not be spent for a very long time, as well as the $400,000 for the affordable housing grant. Hewitt cautioned that tomorrow they could announce that they’re going “full blast” and the DDA would need to meet those commitments.

Russ Collins said he supported his partnerships committee co-chair 100% – that’s Sandi Smith. From a practical point of view, said Collins, the DDA could make good use of the energy grant money. On procedural grounds, Collins objected to the fact that the operations committee had effectively made a policy decision on behalf of the partnerships committee. A reduction would have had a budget impact, Collins said, but the elimination amounted to a policy impact. About seeing the budget, Collin said, “It’s terrible to be surprised, and that’s a surprise.” Collins characterized adding another $100,000 to the deficit is “not extremely imprudent.” But picking up on Gunn’s comment, he said that assuming the $9 million won’t be spent was imprudent.

Collins allowed that the elimination of funds supporting the merchant associations had received a lot of discussion over the years, so the elimination of those didn’t bother him at all. He didn’t want to be “looped into” the sentiments in favor of keeping financial support for the merchant associations.

Jennifer S. Hall said she supported Smith’s amendment, but wanted to contemplate another one that would restore the other funds after voting on Smith’s proposal.

Mouat returned the conversation to the fund balance, expressed as a percentage of annual recurring operating expenses. Hewitt said the city wanted to see 15%, while Morehouse said he was looking to preserve 5%.

Smith echoed Collins’ sentiments that there could have been better communication from the operations committee. Board chair John Splitt clarified that when the operations committee had discussed the energy grants, they’d talked  about whether the money would actually be spent. They did not feel it would affect what would happen “on the ground,” Splitt said. At that point, Gunn called the question.

Outcome: The amendment to restore $100,000 to Phase II energy grants was approved, with Clark and Hewitt dissenting.

Board Budget Deliberations: Reduction of $2 million Contingency for the City

In following up on the intention she’d expressed to bring an additional amendment forward, Jennifer S. Hall proposed that the $2 million budgeted as a contingency for the city of Ann Arbor should be reduced to $1.65 million, with the balance of $350,000 allocated to the DDA programs that had been slated for elimination. The amendment was seconded by Newcombe Clark.

Hall noted that Joe Morehouse had indicated the change in the financial picture necessitating those eliminations had been the re-direction of parking lot revenues – from 415 W. Washington and Fifth and William – to the city of Ann Arbor. The $2 million contingency was there, she said, in order to accommodate a revenue request from the city. The revenue from those parking lots, she said, should be credited towards that $2 million.

Russ Collins cautioned that just because a line item has existed in a budget in the past does not mean it should exist in the future. Collins noted that the DDA’s “mutually beneficial” committee was in a good faith process with some good work already done, and that the resolution, he felt, would undermine that work. Leah Gunn told Collins that she did not want to see the negotiating position of the “mutually beneficial” committee weakened.

Hall recounted how the DDA had made a good faith effort to negotiate and how the city council had not followed up.  From a December 2009 Chronicle article: “City-DDA Parking Deal Possible“:

• 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.

Her position all along, said Hall, was that the arrangement needed to be mutually beneficial.

For his part, Clark noted that the contingency was simply there as a tool. “We’re not removing anything. It’s arbitrary.” Clark said he was not going to be in favor of cutting programs until the board understood exactly what the city was requesting: “It needs to be off the table until it’s on the table.”

Joan Lowenstein noted that the $2 million is not an arbitrary amount – it is the amount that has been paid under the parking agreement for the last five years. Lowenstein rejected Hall’s contention that the revenues from the 415 W. Washington and Fifth and William lots should count towards the $2 million, saying that those were”separate pools” and not a part of the same negotiation. Separate decisions were made on a separate basis, she said. The resolution, Lowenstein feared, would show that the DDA board was trying to “play games” with the city council.

Gary Boren, who also serves on the DDA’s “mutually beneficial” committee, said he was sympathetic to Russ Collins’ point of view about the resolution potentially undermining the committee’s work. However, it hurt the DDA when they had to cut programs that were working, he said. Boren noted that the DDA did not need to back off of the $2 million, but that the resolution would make clear to the city council that “this will take some skin out of us.”

Gunn expressed disappointment that the merchant associations did not report back about how they’d spent their money. Keith Orr responded by noting that a representative from the Kerrytown District Association had addressed the DDA board [at its Feb. 3, 2010 meeting] on that subject. Orr also suggested that the idea of “mutual benefit” could be replaced by “mutual sacrifice.”

Smith said she appreciated the spirit of the resolution, noting that the window display contest money was an example of a small amount of dollars that could go a long way.

Russ Collins called the question.

Outcome: Hall’s resolution to reduce the $2 million contingency by $350,000 failed, getting support only from Hall, Clark, and Boren.

Overall outcome: The budget was approved with support from Boren, Collins, Gunn, Hewitt, Lowenstein, Mouat, and Orr. Voting against it were: Hall, Clark, Smith, and Splitt.

Development Issues

The DDA board meeting included a variety of issues related to new development in the downtown area.

Library Lot

In August of 2009, the city of Ann Arbor issued an RFP for development proposals for the top of an underground parking garage currently under construction on the city-owned Library Lot, between Fifth Avenue and Division Street just north of the Ann Arbor District Library. At its Wednesday meeting, the DDA board got updates on construction and planning for the top of the structure.

Reporting out from the capital improvements committee, John Splitt gave an update on the construction of the underground parking structure along Fifth Avenue. Earth retention preparation work was nearly complete on the “dogleg” – the section of the lot abutting Division Street. [The work consists in part of drilling large holes deep into the ground and inserting steel beams into those holes.] That means people will start to see “real digging” as soon as next week, Splitt said. [As of Thursday, March 4, digging in earnest seems to have commenced, based on Chronicle observation.]

Bid package #3, 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.]

In his report out from the Downtown Citizens Advisory Council, Ray Detter said that the DCAC opposed the placement of a large park on top of the Library Lot, where the underground parking garage is being constructed. [The two open space proposals submitted in response to the city's RFP have since been set aside for further consideration by the committee: "Two Library Lot Proposals Eliminated"] The DCAC did, however, support the idea of taking the next two years to plan that entire area of the downtown, said Detter.

Reporting out from the Library Lot RFP review committee, John Splitt said that Ann Arbor city administrator Roger Fraser had not yet hired a consultant who would be examining the financial aspects connected with the two proposals that are being given further consideration by the committee.

Sandi Smith noted that the RFP schedule was designed so that if a decision were made to move ahead with a particular proposal for development, changes in the design of the underground structure could be undertaken. She noted that the window of opportunity seemed to have been missed by now, and wondered if that did not perhaps remove some of the timing pressure to get to a decision. Susan Pollay, executive director of the DDA, confirmed that the parking garage was “on its way” now as designed. However, she pointed out that the design teams of the two remaining proposals under consideration were very familiar with the underground parking garage design, and that they would be able to accommodate their projects to its design.

Jennifer S. Hall inquired about the possibility that the extra supports designed into the underground garage – so that something could be built on the top of the underground garage – could be stripped out. [Proposers of a public gathering space, the Ann Arbor Community Commons, have called for such a strategy in order to free up money to pay for implementation of their commons.] Pollay told Hall that stripping out those supports would actually entail re-engineering the design of the garage and would, in fact, add cost.

Zingerman’s Expansion

In his report out from the Downtown Citizens Advisory Council, Ray Detter called the board’s attention to a public participation meeting for a proposed expansion of Zingerman’s Deli operations scheduled for March 8 at the deli, 422 Detroit St., starting at 5 p.m. Zingerman’s plan generated “heated discussion” at DCAC, said Detter. The deli is located in the Old Fourth Ward historic district. He said they agreed that Zingerman’s is an essential part of the community, but that they needed to make sure there’s not a precedent set that would undermine planning. The decision needed to be oriented around the city’s planning documents: the downtown plan, the central area plan, and the historic district.

Downtown Zoning and Design Guidelines

In remarks made at the end of the meeting during a time allotted to bring up other DDA business matters, Roger Hewitt expressed some frustration about the city council’s appointment of a task force charged with the responsibility of establishing design guidelines for downtown zoning. By way of background, Hewitt had served on the A2D2 steering committee that oversaw a years-long rezoning process, along with city councilmember Marcia Higgins, and Evan Pratt, of the planning commission.

City council ultimately approved the downtown zoning amendments, but did not enact the design guidelines, pending completion of a design guideline package that would include some kind of mandatory process with voluntary compliance. [See Chronicle coverage: "Downtown Planning Process Forges Ahead: New zoning approved, design guides will take longer"]

At the February 2010 DDA board meeting, Hewitt’s remarks showed that he had not been kept apprised of the fact that the A2D2 committee had been dissolved, after the city council had approved the rezoning component but before the design guidelines were completed:

In reporting out from the A2D2 oversight committee on which he serves, Roger Hewitt stated that the last meeting had been canceled and so he had nothing to report.

Later in the meeting, John Hieftje told Hewitt that the A2D2 oversight committee had actually been dissolved. This seemed to come as news to Hewitt, who said simply, “Oh!”

Said Hewitt about the design guidelines: “Apparently we’re going to revisit the entire process.” He noted that there was no representation from the DDA on the design guidelines task force, even though it would have a “profound impact” on the downtown area. Russ Collins wondered how that might be best addressed. Hewitt responded with humor, suggesting that he might talk to any councilmembers that Collins might know, who might be sitting next to him – the allusion was to Sandi Smith, who serves on the city council, representing Ward 1, in addition to serving on the DDA board. Smith and Collins co-chair the DDA partnerships committee.

In his report out from the Downtown Citizens Advisory Council earlier in the meeting, Detter said that they were glad to see the city council appointment of a task force to look at the design guidelines that will accompany the A2D2 rezoning of the downtown. That task force would be led by councilmember Marcia Higgins, he said, with Wendy Rampson (the city’s head of planning), Kevin McDonald (senior assistant city attorney), Kirk Westphal (planning commissioner), as well as Norm Tyler, Peter Pollack, and Tamara Burns. Detter said that out of the task force’s work they expected to get a system of required compliance with a process, including a review by a design board, and voluntary compliance with the outcome of that process.

Parking Surveys

Roger Hewitt reported on two surveys – one conducted online as part of the DDA’s effort to gauge public opinion about parking issues in preparation of a report it will make to the city council in April.

Online Parking Survey: Principles and Implementation

The online survey ran for 10 days between Feb. 9, 2010 and Feb. 19, 2010 and received 1,283 responses. Of those respondents, 73% reported being Ann Arbor residents, while 27% reported being non-residents. Almost an equal number of residents – 41% and 40%, respectively – reported being 51-71 years old and 31-50 years old.

Hewitt said there was “strong alignment” with the basic principles the DDA used, but more divided opinion about the specific implementation of those principles. For example, there was a 17-17 split between positive and negative comments on the investment in the underground parking structure. And support for some specific policies depended on respondents’ use of parking services: 59% of parking permit holders supported improving bicycling infrastructure, while low-frequency parkers supported it at an 81% rate.

Of the 54 respondents who weighed in on extended evening meter hours, 85% wanted evening parking to remain free. About the new e-park system, 61 respondents commented on the machines, and the written summary indicates that frustration was expressed about the “speed of the machines, screen visibility and reduced convenience and ease.”

On-Street Parking Survey: e-park

A second, on-street survey described by Hewitt at Wednesday’s meeting targeted e-park users specifically. Users of e-park stations on State, Liberty, Detroit, and Main streets were surveyed between Feb. 19 and Feb. 25 – 95 people responded. Hewitt characterized those responses to the survey as “pretty overwhelming” on the positive side, with 91.4% of respondents characterizing the machines as very easy, easy, or somewhat easy to use.

Hewitt also mentioned that paying by phone was not described by respondents as useful, perhaps because many of them indicated that they did not know it was an option. Hewitt suggested that some marketing work could be done on that. [.pdf of e-park survey results]

How useful are the following e-park features:
                                                   Don't Know,  Response
                    Very useful Useful Not useful  Never Used   Count           

Pay by credit card    61.1%     29.5%     0.0%       9.5%        95
Pay with coin         38.7%     53.8%     1.1%       6.5%        93
Add time at any epark 57.0%     24.7%     4.3%      14.0%        93
Pay by cell phone     20.4%     10.8%     8.6%      60.2%        93

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Other Business

The board heard a number of other reports and comments.

Wireless Washtenaw

Reporting out from the partnerships committee, Sandi Smith told the board they’d received a presentation on Wireless Washtenaw from Tom Crawford, the city of Ann Arbor’s CFO. Smith said that Crawford had explained that the priority for the rollout of wireless high-speed Internet access had been in rural areas, where there was currently no access at all. [James McFarlane, who manages Washtenaw County's information technology operations, gave county commissioners an update recently on the status of the Wireless Washtenaw project.]

Smith also reported that Crawford had told them about another possibility for wireless access. There’s potential that the bandwidth made available by TV stations previously used to broadcast an analog signal could eventually be available for wireless Internet connectivity.

DDA Board Retreat

Roger Hewitt announced that the DDA retreat had been scheduled for March 16 with the gathering for lunch starting around “noonish.” The retreat will be held at the offices of Bodman LLP in Suite 400 at 201 S. Division. One main topic of the retreat will be urban versus suburban identity, as well as the comprehensive parking plan.

Sandwich Sign Boards

Reporting out from the transportation committee, Keith Orr gave an update on the status of the sandwich sign board ordinance that the city council had considered, which would have made the signs legal, but put a permitting system in place. Susan Pollay, executive director of the DDA, had appeared before the council at its Feb. 16, 2010 meeting to ask the council to adopt the new ordinance, minus the permitting system:

Also during the public hearing, Susan Pollay, executive director of the Downtown Development Authority, read a brief statement on behalf of the DDA, saying that sandwich board signs are part of what makes for a vibrant downtown experience. She suggested that the system be adopted without permits and then reviewed after one year to determine if there was adequate compliance.

Orr reported that the city council had voted down the ordinance – which Sandi Smith then stressed meant only the demise of the current attempt to make the sandwich boards legal and to regulate them somehow. The fact that the sandwich sign boards remain illegal was, said Orr, “perhaps not the desired result.” Russ Collins kidded Orr as to whether he was recommending that merchants commit acts of civil disobedience.

Bicycle Hoop Requests, Maps

Reporting out from the transportation committee, Orr called attention to a feature on the DDA website that allowed people to request installation of bicycle hoops. He also indicated that DDA intern Amber Miller was working on a bicycle map for downtown.

Downtown Citizens Advisory Council

Ray Detter gave his report from the Downtown Citizens Advisory Council, which meets the evening before the DDA board holds its regular Wednesday noon meeting. [The majority of Detter's comments during his update are reflected in previous parts of this meeting report.]

He said that DDA board member (and Ann Arbor city council member) Sandi Smith had attended the meeting. The DCAC had covered a number of topics, Detter said, including efforts to improve maintenance and safety at Courthouse Square – a housing complex for seniors at the southwest corner of Huron and Fourth Avenue. Detter told the board that the DCAC continued to support the DDA’s efforts at transportation demand management.

Present: Gary Boren, Newcombe Clark (via phone), Jennifer S. Hall, Roger Hewitt, John Splitt, Sandi Smith, Leah Gunn, Russ Collins, Keith Orr, Joan Lowenstein, John Mouat.

Absent: John Hieftje.

Board retreat and next regular board meeting: A retreat will be held on Tuesday, March 16 at the offices of Bodman LLP, Suite 400, 201 S. Division, starting at noon. The next regular board meeting is at noon on Wednesday, April 7, 2010, at the DDA offices, 150 S. Fifth Ave., Suite 301. [confirm date]