DDA board chair Leah Gunn at the April 3, 2013 board meeting. (Photos by the writer.)

The proposed amendments to Chapter 7 of the city code, given initial approval at the council’s April 1, 2013 meeting, would reduce the DDA’s TIF capture by roughly $931,000 for FY 2014 – compared to the amount the DDA would receive based on the DDA’s current interpretation of the ordinance. But in adopting its two-year budget recently, DDA did not factor in recent building projects in the downtown – which add to the increment on which the DDA can capture taxes, starting in FY 2014.

So compared to the amount of TIF revenue in the DDA’s adopted FY 2014 budget, the clarified calculations would result in only about $363,000 less TIF revenue for the DDA. And compared to the DDA’s adopted FY 2015 budget, the clarified calculations would result in about $74,000 less revenue than budgeted. The clarified calculations would result in TIF revenue to the DDA in FY 2014 and FY 2015 of $3.570 and $3.682 million, respectively.

A dispute on the clarity of the existing Chapter 7 language had emerged in May 2011 just as the DDA and the city were poised to sign a newly renegotiated agreement under which the DDA manages the public parking system. At that time, the city’s financial staff reportedly first noticed the implications of an existing Chapter 7 paragraph that appears to place a cap on the DDA’s TIF capture – a cap that’s calibrated to projections in the DDA’s TIF plan. The TIF cap rises each year based on forecast growth in the DDA’s TIF capture district.

Several board members weighed in on the issue during the April 3 meeting. The idea of any kind of cap – let alone one that’s based on estimates contained in the appendix of the DDA’s TIF plan – was sharply criticized by Joan Lowenstein, who characterized the approach as based on “a fallacy.” She also called the idea of a cap poor public policy. However, both the cap and its basis are already in the existing ordinance language that the city council’s ordinance amendment seeks to clarify.

Roger Hewitt took the board’s meeting as an opportunity to question whether the ordinance amendments actually clarify how the calculations are to be done, contending that he’d come up with different results than the city treasurer, starting from the same ordinance language. He cautioned that the DDA’s financial planning and the DDA’s budget would need to be re-evaluated – allowing for no “sacred cows” – if the council gave final approval to the ordinance changes.

Russ Collins contrasted the amount of net revenue received by the city from the geographic area of the DDA district before the DDA was established back in 1982, compared to today. The net proceeds from taxes and the public parking system (which lost about $250,000 a year during that era) came to about $1.25 million 30 years ago, according to Collins. Today, the city receives nearly $8 million annually – around $4 million in taxes, $3 million in parking revenue, and a grant to the city of roughly $0.5 million a year toward debt on the city’s new Justice Center building.

Bob Guenzel focused his remarks less on the financial side and more on the aspects of the ordinance change that would restrict future board membership. He saw no benefit to the proposed DDA term limits, noting that the city council has an opportunity to end a DDA board member’s service by deciding not to re-appoint someone to the board. John Mouat was critical of the proposed ordinance changes that would prevent elected officials of taxing jurisdictions from serving on the board, saying he’d found the participation of politically-connected people to be beneficial to the board.

The extended remarks by board members on the topic came in the context of a 7-3 vote by the city council on April 1, giving initial approval of the ordinance changes. [Christopher Taylor (Ward 3) was absent from the meeting of the 11-member council.] A second vote, expected at the council’s April 15 meeting, would be required to enact the changes. Based on their remarks made at the council table, two of the seven votes in support of the changes – by Marcia Higgins (Ward 4) and Sabra Briere (Ward 1) – were widely read as likely to change at the second vote. Ordinance changes require a six-vote majority.

In addition to discussion of the possible ordinance changes, the DDA heard its usual range of committee reports, including the monthly parking update. Public commentary related to a possible artificial ice-skating rink atop the Library Lane underground parking garage.

Chapter 7 Ordinance Amendments

On April 1, the Ann Arbor city council gave initial approval to a set of changes to Chapter 7 of the city code, which governs the Ann Arbor Downtown Development Authority.

Chapter 7 Amendments: Background

The revisions considered by the council fell roughly into two categories: (1) those involving board composition and policies; and (2) calculation of tax increment finance (TIF) capture in the DDA district.

In the first category, the revisions to Chapter 7 that were given initial approval by the council included: a new prohibition against non-mayoral elected officials serving on the DDA board except by agreement with the other taxing jurisdictions; term limits on DDA board members; and a new requirement that the DDA submit its annual report to the city in early January.

Another amendment stipulates that if tax increment financing is used as the financing method for an approved authority project, the project must meet one of the DDA’s adopted plan goals. Among those plan goals is support of housing. The amendment provides the ability of the DDA to make investments in properties not strictly in the district, but also in neighborhoods near the district.

More significantly, the council gave initial approval to proposed revisions to Chapter 7 that would clarify how the DDA’s TIF tax capture is calculated. The “increment” in a tax increment finance district refers to the difference between the initial value of a property and the value of a property after development. The Ann Arbor DDA captures the taxes – just on that initial increment – of some other taxing authorities in the district. Those are the city of Ann Arbor, Washtenaw County, Washtenaw Community College and the Ann Arbor District Library. For FY 2013, the DDA will capture roughly $3.9 million in taxes.

The proposed ordinance revision would clarify existing ordinance language, which includes a paragraph that appears to limit the amount of TIF that can be captured. The limit is defined relative to the projections for the valuation of the increment in the TIF plan, which is a foundational document for the DDA. The result of the clarification to the Chapter 7 language would mean about $363,000 less TIF revenue for the DDA in FY 2014 – compared to the $3.933 million shown in the DDA’s adopted budget for that year. For FY 2015, the gap between the DDA’s budget and the projected TIF revenue – using the proposed clarifying change to Chapter 7 – is just $74,000.

However, the total increment in the district on which TIF is computed would show significant growth. And under the proposed clarification of Chapter 7, that growth would result in a return of TIF money to other taxing jurisdictions – that would otherwise be captured by the DDA – totaling $931,000 each year for FY 2014-15. The city of Ann Arbor’s share of that would be roughly $559,000, of which $335,000 would go into the general fund. The city’s general fund includes the transit millage, so about $69,000 of that would be passed through to the Ann Arbor Transportation Authority.

The amount of TIF capture that’s returned to the other taxing jurisdictions is tied to growth in the valuation by the Chapter 7 language. Under Chapter 7, if the actual rate of growth outpaces the growth rate that’s anticipated in the TIF plan, then at least half the excess amount is supposed to be returned to the other taxing authorities in the DDA district. In 2011, the DDA for the first time returned excess TIF capture to other authorities, when the existence of the Chapter 7 language was reportedly first noticed. At that time, the DDA made repayments of TIF monies to other authorities of around $400,000, which covered what was owed going back to 2003. When the DDA calculated the amounts owed in 2011, the city of Ann Arbor waived its roughly $700,000 share.

In 2011, the DDA used a year-to-year interpretation of the Chapter 7 language instead of computing rate of growth against the base year in a cumulative fashion. That is a point that the Chapter 7 revisions would clarify. At the two previous meetings when the council had considered but postponed voting on the ordinance amendments, that specific point had not been addressed. But the substitute ordinance revision offered on April 1 clarified the current language in favor of the cumulative methodology. Previously, the council had postponed voting at its March 18, 2013 and March 4, 2013 meetings.

The figures below come from the city of Ann Arbor’s financial services staff. Labels are The Chronicle’s.

MOST RECENT PROJECTIONS FOR TIF CAPTURE (in millions)
 FY 13   FY 14  FY 15
========================== 
 3.957   3.933  3.756  DDA Adopted Budget TIF Revenue
 3.957   4.501  4.613  Projected TIF, DDA View 
 3.957   3.570  3.682  Projected TIF, Clarified Ch. 7
          .568   .857  Budgeted vs Projected, DDA View
         (.363) (.074) Budgeted vs Projected, Clarified Ch. 7
==========================

ADDITIONAL REVENUE FROM CLARIFIED CH. 7
 FY 13   FY 14  FY 15
========================== 
          .335   .335  City General Fund
          .223   .223  City Non-General Fund
          .559   .559  Total City

          .372   .372  Total AADL, WCC, WC
          .931   .931  Total

-

These projections do not include the capture that would result in future years from completion of City Apartments, 624 Church, 618 S. Main, or 413 E. Huron (assuming that it is approved).

Chapter 7 Amendments: DDA Director Summary

Susan Pollay, executive director of the Ann Arbor DDA, gave the board an update on the city council’s action on April 1. She reported to the board that a fair number of questions had been asked and answered – via e-mail preceding the meeting and also during the meeting that evening. She characterized the ordinance changes as involving three main points. The first relates to the definition of the DDA’s tax increment finance (TIF) capture – which would reduce the amount received by the DDA by imposing what Pollay called a “permanent cap.” [The cap induced by the ordinance is keyed to the estimates in the TIF plan, which increase each year. That is, the cap Pollay described is not a fixed amount, but rather increases each year.]

Pollay explained that there are some confusions about the interpretation of the current ordinance – saying that if the annual (year-to-year) method is used, that would have some impact but not as dramatic an impact on the TIF capture as the cumulative method. So there have been questions about why that particular interpretation has been used.

The second point Pollay characterized as an elimination of the DDA’s obligation for its bond issuances. She noted that the DDA has responsibility for $67 million worth of projects – including the parking deck component of the City Apartments project, Fifth and Division streetscape improvements, and the Library Lane parking garage project.

Pollay described the ordinance revision as eliminating the language now in the ordinance that relates to bond obligations. She then quoted out the relevant section. She characterized it as a pretty significant policy change, with respect to the DDA’s obligation to its debt service. [The DDA interprets the language to mean that it's entitled to full TIF capture as long as its total debt service requirements exceed the amount of TIF captured. However, on a different interpretation, the language simply means: Of the TIF that is received, first to be paid is debt service, followed by other distributions in support of the development plan for the purpose of the DDA's existence, followed by possible return of surplus TIF to the taxing jurisdictions.]

The final issue, Pollay said, has to do with governance. She observed that there are relatively few boards and commissions that have term limits – and other than the park advisory commission, she wasn’t aware of any. [The greenbelt advisory commission (GAC) also has term limits, a point highlighted at the commission's April 4, 2013 meeting.] The proposed ordinance revisions would impose term limits for the DDA board and would eliminate elected officials from future participation on the board, Pollay said. The ordinance revisions would also potentially allow the mayor to serve on the DDA board, she noted, but that would be on a year-to-year basis.

She summarized the changes by saying that: the TIF capture would be affected pretty dramatically; there would be no further connection between the DDA and debt service for the DDA’s projects; and term limits would be imposed on the board members. She noted that the council had approved the ordinance revisions at first reading, and the second reading would be coming at the council’s April 15 meeting. At that meeting there would be a public hearing as well, Pollay noted.

Chapter 7 Amendments: Board Remarks – Financial

Bob Guenzel asked if the Ann Arbor DDA and the city were clear with “the rest of the world” about how TIF capture is to be calculated. Pollay replied by saying that the DDA had received charts from the city staff. The text of the ordinance itself as put forward, she said, is from her perspective not any more clear. She felt that five years from now if the city or the DDA were to look at it, she’s not sure that it would be clear.

Pollay reported that she and Roger Hewitt had met with city staff for the better part of a week. And using the same language as in the ordinance revision, Hewitt had arrived at different numbers from the city staff. According to the city staff calculations, the revised ordinance would reduce the TIF revenue to the DDA by $931,000 for FY 2014 [compared to the amount the DDA would receive based on its interpretation of the current ordinance language.] Compared to what the DDA has budgeted for FY 2014, the TIF revenue would be $363,000 compared to what the DDA had budgeted. And going forward, there would be a cap, she said.

DDA board member John Mouat. In the background is board member John Splitt.

John Mouat ventured that there are several downtown development authorities in the state, so it might be possible to seek guidance on interpretation based on how other DDAs compute TIF. Pollay noted that each downtown development authority is created by its own community – so it’s not one-size-fits-all. “Our own TIF has been around for quite a while,” Pollay said. She said that the Ann Arbor DDA had been operating under a shared understanding – but now has learned that not everybody in the present agrees with what was done in the past.

Hewitt said that as treasurer, he felt he had a fiduciary responsibility at least to talk about what the impacts of the ordinance changes are. The first thing he found disturbing and disappointing is that in his time on the DDA board, it’s the first time that the council has decided to take action without any prior consultation with the DDA on the impact.

By way of background, the council has actually taken action previously that has affected the DDA budget – without consulting the DDA. In 2007 the council reached into the DDA’s already adopted budget and changed an item on the same night it approved the city’s budget as a whole. From the May 21, 2007 city council minutes [Fund 0003 is the TIF fund]:

[FY 2008 budget] Amendment 11

Resolved, that the Downtown Development Authority fund (0003) expenditure budget be decreased by $1,600,000 to reduce the appropriated reserves for future capital construction projects.

On a voice vote, the Mayor [John Hieftje] declared the motion carried with one dissenting vote made by Councilmember [Joan] Lowenstein.

At the April 4, 2013 meeting, Hewitt continued, calling the council’s action this time “unprecedented,” saying “We have essentially been out of the loop.” It’s difficult to understand exactly what the goal is of the ordinance changes, he contended.

The two things Hewitt found most troubling about the ordinance changes were: (1) the change in the financial basis on which the DDA did its planning; and (2) remaining unclarity in the ordinance, despite the changes.

Hewitt said over the last few years the DDA has undertaken $67 million worth of infrastructure improvements to the downtown. A very detailed financial plan had been put forth, he said, the basis of which he said is in the ordinance – that debt service will be paid off before there was any rebate of TIF back to the taxing authorities. [This is an interpretation of the ordinance language that relies crucially on a specific reading of the phrase "as set forth above." In context, the phrase has an interpretation that is arguably different from the one on which the DDA is relying.] By changing that language, Hewitt contended, the city had changed the financial basis on which the DDA had put that plan forward. He likened the situation to changing the rules after the money was spent.

The second part, he said, is the confusion about how the TIF should actually be calculated – based on the annual method or the cumulative method. Hewitt contended that he had taken the language in the proposed ordinance change and come up with some calculations, and had met with city treasurer Matt Horning and the city’s chief financial officer Tom Crawford. The two city staff members had taken the same language and come up with an entirely different way of calculating it. Russ Collins interjected to confirm that it was the city’s numbers that were presented to the council. Hewitt confirmed that was the case, and said that he was not trying to say who was right and who was wrong. He noted that there is no formula in the revised ordinance language to guide the calculation. If the ordinance is supposed to bring clarity to how that is done, it certainly falls far short of it, Hewitt contended. It’s still open to interpretation, he said.

If the ordinance is enacted, the DDA needs to reevaluate its 10-year budget and its 10-year plan, based on the revised ordinance. But without some clarity about how the calculation is done, Hewitt said, the DDA cannot make projections about how to adjust its long-range plan. Assuming the clarity can be achieved on how the calculations are done, Hewitt said he felt the DDA needs to reevaluate its budgets and its 10-year plan – based on a new reality. He felt that all the commitments in the DDA budget need to be examined. Everything would need to be put on the table. He felt there should be no “sacred cows” about what gets saved and what doesn’t.

What could be a small impact in the first two years could multiply to a larger impact in subsequent years, Hewitt contended. He felt the board’s operations committee needs to sit down and try to achieve some clarity, assuming that the ordinance is approved. And then the committee needs to reevaluate the DDA’s current budget and the 10-year plan, focusing on the DDA’s core mission: Infrastructure improvement to encourage economic development of the downtown. He said the DDA would be remiss in its financial responsibilities if it did not take up that challenge.

Chapter 7 Amendments: Board Remarks – Policy Issues

Joan Lowenstein said she’d noticed some things in watching the city council deliberations the other night. She indicated that she identified with councilmember Sabra Briere with respect to the math part, which is also not Lowenstein’s strong point, Lowenstein said. Then Lowenstein sought to clarify what she was trying to say about Briere – not that math is not Briere’s strong point, but rather that this is what Briere herself had said. The remark drew a laugh from board members. DDA board chair Leah Gunn noted that Briere was in the audience. [Briere did not appear to take any offense at Lowenstein's comments.]

DDA board member Joan Lowenstein. Next to her is board member Keith Orr.

It’s really the public policy part of the question that bears examining, Lowenstein said. She identified two public policy issues.

First, when she previously served on the city council, whenever an ordinance change was being considered, it was considered important to look at it much more strictly than you would if it were simply a resolution. That’s because ordinances are in a sense “written in stone” – or at least the digital equivalent of that, Lowenstein said. So when you’re making an ordinance change, she said, you’d better make awfully sure that this is something you really want to be there for a very long time.

And this ordinance change is based on calculations that nobody agrees on, Lowenstein said. Those calculations stem from the downtown development plan, which has an appendix, and the numbers in that appendix are estimates of what the growth will be in the downtown. So if the estimate for the first year is incorrect, she contended, then all the other estimates are also incorrect. So this ordinance is based on a “fallacy,” she concluded. And the calculations are based on fallacies. And that doesn’t make sense for an ordinance change.

On the second public policy issue, Lowenstein said, she felt that the original ordinance language that puts a kind of cap on the TIF capture was “misguided.” She had researched the history of the formation of the DDA. She contended that the only people who objected to the TIF capture were people who said: We really shouldn’t be taking money out of the schools. It was only the idea of taking school money that really got people stirred up, she contended. “Well, we don’t take school money anymore,” Lowenstein said. So the whole question about the DDA TIF capturing money that could be used for education is moot, she concluded.

As a matter of principle, if you’re looking at investment, whether it’s your own personal investment, or business investment, or in this case the city, Lowenstein continued, you don’t stop the investment at the point when you are doing well. After so much belt-tightening, she said, “we are now getting to the point where we can see that we are really doing well.” So this is not the time to stop investment, she said. The idea of a cap on something that continually increases your economy just doesn’t make sense, she contended.

Aside from all of the arcane mathematical questions about how you calculate things, Lowenstein felt fundamentally it’s a question of whether a cap is good public policy, and it’s clearly not, she contended.

Chapter 7 Amendments: Board Remarks – Positive DDA Impact

Roger Hewitt then offered a personal perspective on the history of downtown Ann Arbor. He has started working downtown shortly after the DDA was formed, he said. He’s been working downtown for nearly 30 years and has owned a business downtown for about 20 years. He felt there’s a tendency to look at the downtown now and think that it wasn’t that different 30 years ago – and that it won’t be that different 30 years from now. Having been here, he said, he could tell you that is simply not true. Thirty years ago the downtown was a rapidly declining retail area. It was in trouble. And it has now evolved into one of the most vibrant downtown areas – with dining and entertainment areas – that you can find in the country, or certainly in the Midwest.

Downtown Ann Arbor didn’t “just happen to” evolve, Hewitt said. If the DDA had not been there to build six new parking structures, to rebuild the sidewalks, and to reconstruct the two remaining parking structures, the downtown would not look the way it does now. The “city fathers and the city council” 30 years ago had the wisdom to recognize that there would need to be major infrastructure improvements, if the downtown was going to prosper in the long-term, Hewitt said. They had the wisdom to set money aside, knowing that there would always be a political demand to be able to use now what money you have now. But by putting that money aside, the DDA was able to invest in those infrastructure improvements that allow the transformation of the downtown.

Without parking to support people in stores and restaurants, Ann Arbor could not have evolved to what we have now, Hewitt said. He hoped that the current city government can look forward and say that we need to set money aside to be able to do those infrastructure improvements in the future – whatever they might be – so that “our children and grandchildren” can enjoy the kind of vibrant downtown that we have now. It doesn’t just happen, Hewitt said. You need to put money aside, to be able to do those sorts of improvements – whatever they look like in the future. You have to keep reinvesting, or you’re not going to have economic development, which seems to be everyone’s goal, he said.

So as soon as there is clarity from the city council, Hewitt said, the operations committee needs to focus on the budgetary changes that need to be made and what projects need to be removed or adjusted. The full board also needs to engage in a discussion on that.

Later in the conversation, Russ Collins adopted the framing of the issue that Roger Hewitt had used – comparing the time when the DDA was established in 1982 to now. Some back-and-forth between Hewitt and Collins established that in the early 1980s the city levied about $1.5 million worth of taxes in what is now the DDA district. And the parking system lost about $250,000 a year. So Collins put the net proceeds to the city of the DDA district in that era at about $1.25 million. According to Hewitt, the city today levies about $4.1 million worth of taxes a year in the DDA district, and receives about $3.1 million a year from gross parking revenues, not to mention the $508,000 for the police courts building. Collins called it a tenfold increase in revenue to the city compared to the time when there was no downtown development authority. That would not have happened, Hewitt said, if there had been no reinvestment in infrastructure.

During his remarks to the board, Ray Detter reported that some members of the downtown citizens advisory council (CAC) were bewildered by what he characterized as the negative attack on the DDA, because it seemed to some of the members to be irrational. The downtown requires special attention, he said. And the downtown development authority is especially equipped with a creative focus and the economic tools for strategic planning that allows for long-term community goals, Detter said.

Chapter 7 Amendments: Board Remarks – City-DDA Partners?

Mayor John Hieftje added that he shared Hewitt’s concerns about the budget, both long- and short-term. He said that one of the problems is that there is a “deficit in education” about what the DDA does. He felt that some of that lack of education had played out during the discussion by the city council and some of it has played out in the community. He also attributed part of the problem to the fact that there are some new councilmembers.

As the recession took place, and city governments across the state really found themselves in great difficulty, the city of Ann Arbor had made it through the recession with essentially the same millage rate as it had before, Hieftje said. Many cities across the state cannot say the same, he noted. He pointed out that in Grand Rapids, the income tax had been raised. [Ann Arbor does not have an income tax.]

But there was also a time during that period when the city needed some help, he noted, and the city had reached out the DDA. One of those times was when Washtenaw County had told the city that the 15th District Court had to move out of the county courthouse. So the city had embarked on a project to build a new police/courts building – and the DDA had “stepped up to the plate,” he said, and committed to that [in the form of an $8 million grant paid in roughly $508,000 million installments]. Implicit in that was an understanding, he felt, that the city would not turn around and change the DDA’s funding and its ability to uphold that commitment.

And then, he said, the city had reached out to the DDA and renegotiated the contract under which the DDA operates the public parking system – something that Hieftje said was not always an easy conversation. Implicit in that is the fact that the city and the DDA are partners, he said. Even though a lot was said on Monday night at the city council meeting, the partnership between the city and the DDA is something that hasn’t been explored enough, he said. The DDA has been an excellent partner for the city, Hieftje maintained – and the police/courts building, and the renegotiation of the parking agreement showed that. These were not actions that the DDA had to take, he contended. But implicit in all of that was the idea that the city would not then come back and pull the rug out from under the DDA.

Hieftje noted that he had a fiduciary obligation to both the DDA and the city – but he said he felt his greater priority was to the city budget. “We appreciate the help that the DDA has offered,” he said. Hieftje felt that more communication was needed to make sure that people are aware of the partnership between the city and the DDA. The commitments were made in good faith, Hieftje said. He hoped that the city would be able to uphold its side of the good-faith agreement.

Later in the conversation, Keith Orr picked up on Hieftje’s remarks, saying that the ordinance change had been a surprise to him. Although the relationship between the city and the DDA had included difficult discussions over the years, it’s been a relationship that has worked very well, he said. “Why are we fixing something that does not appear to be broken?”

Chapter 7 Amendments: Board Remarks – Board Composition

Bob Guenzel stressed how important the long-term fiscal stability had been for the DDA, and he did not think it was a good idea to change it. But he focused his remarks on the governance issues and the term limits. Guenzel noted that he had been involved with county government “for a while.” [An understatement – Guenzel worked at for the county for 37 years, including 15 years as county administrator.] He had observed that most boards and commissions do not have term limits. They have limits in the sense that every two or four years the appointing body can reappoint members. He noted that all the DDA board members were appointed with the approval of the city council. So the city council can limit a DDA term whenever they want to. It’s important also, he pointed out, to have a mix of people who are “seasoned,” and who can see the long-term, because they have been there from the beginning. He felt that there’s been a disadvantage of not having that seasoning in the state legislature, which now has term limits.

For a body such as the DDA, which is very focused on a specific mission, Guenzel thought it was very important to have folks who been a part of the mission, and who can carry that mission forward. He saw no reason to impose term limits on DDA board members.

Later in the conversation, John Mouat added that as a non-politically-connected sort of person, he wanted to express his gratitude, saying that he saw value in having people on the DDA board who know how things work at the city and county, and the machinations of it all. For those people who are not involved politically, he said, it’s difficult to understand how all the moving pieces work together. So he appreciated the elected officials being on the board. He also said he’d never had an experience where any of them had tried to coerce, or direct him in any way.

Monthly Parking Report

Roger Hewitt delivered the monthly parking report. The most recent monthly figures were for February 2012. He said that the operations committee is still working on getting more detailed reports on actual hours used. That will allow the DDA to get better insight into how the system is actually working.

Revenue for February 2013 was $1,532,504 compared to $1,362,989 last year – a 12.4% increase. That amount includes revenues from parking meters and from monthly permits. The number of hourly patrons in February 2013 was 172,385 compared to 174,492, or a drop of 1.2%.

The comparison was impacted by the fact that February 2012 was a leap year, with 29 days – something that Russ Collins highlighted. He contended that the reduced usage was almost entirely explained by a month with one less day. John Splitt also pointed out that it was colder this year.

Ann Arbor Public Parking System: Revenue

Ann Arbor Public Parking System: Hourly Patrons

Ann Arbor Public Parking System: Revenue per Space – System

Ann Arbor Public Parking System: Revenue Per Space – Surface Lots

Ann Arbor Public Parking System: Revenue per Space – Structures

Communications, Committee Reports

The board’s meeting included the usual range of reports from its standing committees and the downtown citizens advisory council.

Comm/Comm: Rail Station

Roger Hewitt told the board he’s part of a study committee that’s looking at station locations for north-south commuter rail service (WALLY). The committee had its first meeting, and a broad swath of the city is under consideration for a possible location – from Hill Street to Summit Street. [Initial reports from the Ann Arbor Transportation Authority indicate that a station stop along the track somewhere between Washington and Liberty streets is one strong possibility.] He noted that it’s an alternatives analysis, funded by money granted to the AATA from the federal government and the Michigan Dept. of Transportation. The study is in the preliminary information-gathering stage.

Comm/Comm: Bike House

John Mouat gave an update on the Bike House under construction in the Maynard parking structure. There’s a possibility that a soft launch to the facility will take place during bike-to-work week, which is May 13-19 this year.

Comm/Comm: Review of D1 Zoning

During his regular report from the downtown citizens advisory council (CAC), Ray Detter told the board that CAC supports the long-promised review of A2D2 zoning to make recommendations on revising the current D1 zoning district.

Comm/Comm: Ice-Skating Rink

During public commentary at the start of the meeting, Alan Haber noted that his group – which is advocating for an ice-skating rink to be installed on top of the Library Lane underground parking garage – had met with the DDA’s partnerships committee in the previous month. He reminded the board of the continuing effort to consider the space as a civic space – for community use, whether it is a commons or a park. Whatever the ultimate name of it is, he said, the idea is that the centrally located space should be developed for citizen use, for all the people, so that Ann Arbor has a central place, however you want to name it – a place that invites all the citizens as a whole.

While longer-term planning is going on – like the Connecting William Street project and the work being done by the park advisory commission’s subcommittee – Haber felt now is the opportunity for the Ann Arbor Downtown Development Authority to experiment with short-term uses that might draw the public to that space. The efforts to generate activity on top of the Library Lane parking structure should be integrated with programming efforts for Liberty Plaza, he said.

The concept for a temporary ice-skating rink took form last November, he told the board – as his group had found out about the possibility of using synthetic ice. Synthetic ice has been used in places where temperatures are not as cold as they used to be, or in the South, for recreational skating. So his group had developed a proposal based on that. And they are now dealing with a range of questions that their proposal has generated. How effective is the synthetic ice? How large a rink could be established?

Haber told the board that he expected his group would return to the next meeting of the partnerships committee with answers to several of those questions. He wanted to convey to the board that many people desire a central place in Ann Arbor that could begin to be called the heart of town.

Comm/Comm: Expand DDA Area, Sunday Parking Charges

Introducing himself as a recent candidate for representative of the 53rd District of the Michigan House, Thomas Partridge accused the DDA board of conducting its meetings as “shadow meetings” of the city council. He called on the city to reorganize the DDA’s charter to expand the downtown fiscal area – to include every important housing development within the city. The DDA should be given a new charter and a new purpose to provide adequate housing. He called Ann Arbor a segregated city that is not well-served by mayor John Hieftje and the Ann Arbor city council.

Partridge criticized the free parking that is provided on Sundays, saying that was giving away 1/7 of each week’s revenue, on the theory that people wouldn’t want to park on Sundays. A parking fee should be charged on Sundays, he said, even if it’s a reduced rate.

Present: Nader Nassif,  Bob Guenzel, Roger Hewitt, John Hieftje, John Splitt, Leah Gunn, Russ Collins, Keith Orr, Joan Lowenstein, John Mouat.

Absent: Sandi Smith, Newcombe Clark.

Next board meeting: Noon on Wednesday, May 1, 2013, at the DDA offices, 150 S. Fifth Ave., Suite 301, Ann Arbor. [Check Chronicle event listings to confirm date]

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Left to right: Roger Hewitt, mayor John Hieftje, Leah Gunn. Hewitt, a DDA board member, had just handed over a check for $1 million to the mayor. It was the second half of a payment the DDA had agreed to make last year, which had not been required as part of the DDA’s parking contract with the city. (Photos by the writer.)

At Wednesday’s meeting, the board also recapped the previous night’s session of the Ann Arbor city council, which had been a continuation of the meeting that began on May 16. At that meeting, the council had finally ratified its side of a new contract under which the DDA would continue to manage the city’s public parking system.

Key elements of that contract include a transfer to the city of Ann Arbor of 17% of annual gross parking revenues, reporting requirements by the city to the DDA about parking enforcement and street repair, and the ability of the DDA to set parking rates and hours without a city council veto.

The DDA board will likely schedule an extended board meeting in September to prepare for a contractually-required joint working session with the city council, which will include a discussion of parking rates and hours of enforcement.

Included in the usual range of the DDA’s reports from its committees was a review of a recent partnerships committee meeting, when DDA board members began to consider how they would handle the responsibility to plan future uses of city-owned surface parking lots downtown. The DDA was given that responsibility in a city council resolution passed at the council’s April 4, 2011 meeting.

Budget Revisions for FY 2011

By way of introducing the resolution on the agenda to revise the budget, Roger Hewitt observed that the DDA passes a budget every year, but is required by state law to amend the budget to reflect actual income and expenses. That’s what the resolution was about, he said.

Many of the changes are due to the South Fifth Avenue underground parking garage construction and the ratification of the new parking agreement with the city. While they are significant changes to the budget, Hewitt said, these were all items the board had previously discussed, voted on and planned for. [.pdf of DDA FY 2011 budget revisions]

Budget Revisions: TIF

Hewitt ticked through the line items that accounted for revisions in the TIF (tax increment finance) fund budget. One item was an added employee. Another line item requiring revision was for energy grants – it had been increased from $200,000 to $381,000 due to unspent money from previous years. The interest payment on the former YMCA lot was shifted out of TIF and into the parking fund. The payment to the city for the municipal center was reclassified as a grant instead of bond payment. There’s an added expense for the real estate consultant – The Roxbury Group – in connection with the Library Lot request for proposals (RFP). The Zingerman’s Deli brownfield program is a $207,000 item, and the return of excess TIF capture to taxing units in the DDA’s district amounted to $473,000.

Some items that are under budget include lower expenses on the Fifth and Division streetscape improvement project. For the Fifth Avenue underground parking structure, the entire bond payment will be made out of TIF fund for the first five years – after that, the parking fund will take over, said Hewitt. For the bottom line, the TIF fund expenses are $850,000 lower than originally budgeted.

Budget Revisions: Parking Fund

In the parking fund, the budget revision reflects about $800,000 less revenue – due to a delay in new rates going into effect. The rate increases had been delayed from July 1 to Sept. 1 due to concerns about the negative impact on summer business. Legal fees had increased due to work on the new parking contract. About $200,000 had been saved by having Republic Parking staff do information technology work instead of contracting it out to a different entity. Overall expenses for Republic Parking were down this year. Bond payments for the underground parking garage are reduced, because the TIF fund will pick up that cost for the first five years.

Hewitt touched briefly on the other two funds in the DDA’s budget – the parking maintenance fund and the housing fund. The parking maintenance fund didn’t get its usual $2 million transfer this year. Actual parking maintenance expenses had been reduced from $1 million to $600,000. Maintenance costs had been deferred, but over the 10 years in the DDA’s 10-year plan, Hewitt said, the maintenance fund would remain whole. The deferred schedule was based on recommendations from the DDA’s engineering consultant. The DDA had elected not to go ahead with installation of additional e-park stations, saving $1.3 million in the short term.

Russ Collins confirmed with Hewitt that the $2 million reduction in parking fund expenses had been achieved primarily by deferring maintenace.

Outcome: The DDA board voted unanimously to approve the changes to its FY 2011 budget.

May 31 City Council Meeting Re-Cap

Board chair Joan Lowenstein invited Roger Hewitt to make the report out from the DDA’s “mutually beneficial” committee by saying that she hoped this is the last time the board ever has to ask for such a report. Hewitt reviewed recent events, including the special meeting the board had convened on May 27 to ratify the final version of the new parking contract under which the DDA would continue to manage the city’s public parking system.

Hewitt reported how the previous evening, the contract had been considered by the Ann Arbor city council, and had provoked a two-hour debate – an hour and a half of which he’d spent answering questions from councilmembers. Some of the questions Hewitt described as “relevant,” and some had not been so relevant. Hewitt reported that an amendment on restoring a council veto to the contract was defeated 9-2, and the vote on the contract was approved 11-0. So now there’s a new parking contract, Hewitt said. It begins July 1, 2011 and lasts for 11 years – there’s an option for both sides to renew it.

The contract will allow the DDA some flexibility for parking demand management. For their work on the contract Hewitt thanked the DDA staff – Susan Pollay and Joe Morehouse. Pollay had been invaluable in making sure the contract gives the DDA the tools it needs, he said. The contract language is much more clear, so there will be no misunderstanding about what it means. He said that Morehouse had repeatedly been given a new set of numbers to run – he’d cranked out an enormous amount of data to help come up with an agreement the DDA can live with.

Lowenstein said a big advantage of the contract is greater stability. She said the DDA didn’t want to give up as much money as the contract calls for, but that the DDA will move on and will be better for it. She thanked Hewitt for his work and mayor  John Hieftje for “steering the discussion” at the city council meeting.

Hewitt returned Lowenstein’s thanks for helping to work out the politics with the city council and “getting it to the finish line.”

Russ Collins described the contract negotiations as a long process. But he said that “we need to ask ourselves: Did we do right by the voters, taxpayers, citizens?” Collins said he appreciated some of the dialogue about the parking contract generated by city council. He may not have appreciated it immediately when he heard it, but he did appreciate it, he said. He also added that he hoped the city council appreciated the DDA’s dialogue.

Sometimes people get whipped up in the controversy without stepping back and understanding what the accomplishment is, Collins said: The parking system is excellent. Parking, he continued, is an emotional issue that transcends logic. Miraculously, Collins said, both the DDA board and the city council had unanimously approved the parking contract – they can’t lose that point. That makes all the “Sturm and Drang” worth it, he said. Collins thanked Lowenstein and Hieftje.

Hieftje noted that the council had also passed another resolution recognizing the issue of excess TIF capture, and councilmembers had agreed to waive the $712,000 in excess taxes that had been captured from the city of Ann Arbor since 2004. Later, during the discussion on budget revisions, Gary Boren asked how final the excesss TIF capture issue was. Had the other taxing units accepted the calculations as correct? Hewitt told Boren the numbers are based on the opinion of Jerry Lax, the DDA’s legal council. Another taxing authority could challenge the DDA’s calculations, he said. The city of Ann Arbor’s share, in any case, is roughly 60% of the total. Lowenstein confirmed that the return of the excess TIF to other taxing authorities would be made by the end of this month.

Hewitt noted that during the council’s May 31 session, an issue had been raised [by councilmember Stephen Kunselman (Ward 3)] about a possible non-payment of $1 million owed to the city by the DDA, which is related to parking revenues (not excess TIF capture). The issue concerned the payment of the second part of $2 million that the DDA had awarded the city of Ann Arbor last year, which had not been required under the parking contract then in place.

Hewitt said he had a check for the mayor, which he handed to Hieftje, saying, “Now, we’re even.”

Communications, Committee Reports

The board’s meeting included the usual range of reports from its standing committees and the downtown citizens advisory council.

Comm/Comm: Downtown Development

Russ Collins reported that Cresson Slotten, the city of Ann Arbor unit manager in the systems planning division, had given a presentation to the partnerships committee on the city’s water and sewer system. Collins said citizens should know that most of it was installed about 100 years ago – things have changed over the last 100 years.

Collins described the problem that is faced when a developer is “first in” and needs to bear the entire cost of installing a new water main, to which subsequent developers get free access. That really doesn’t seem fair. Sandi Smith, who co-chairs the partnerships committee with Collins, also noted that Doug Kelbaugh, former dean of the University of Michigan college of architecture and urban planning, and lecturer Kit McCullough had approached the committee and shared their thoughts on a public process for the future use of city-owned downtown parcels. [Chronicle coverage: "DDA Preps Downtown Ann Arbor Process"]

They want to develop a shorter term 5-year vision as well as a 25-year vision, Smith said. She noted that local developer Peter Allen has also made some efforts in this direction, too, already talking to individual business owners in the area of the Library Lot, where the DDA is building an underground parking structure. Allen is doing this on his own, Smith noted. She said the committee had asked Kelbaugh and McCullough to come up with a specific proposal, and they’ll present that at the next meeting of the DDA partnerships committee. The DDA can then decide if it wants to hire them. The next meeting of the partnerships committee is June 8, 2011 at 9 a.m. at 150 S. Fifth Avenue.

Local developer Peter Allen appealed to the map on the wall for his brief remarks made during public commentary at the DDA board’s June 1 meeting.

Peter Allen was also present at the June 1 meeting. He took the opportunity –provided at the end of all DDA board meetings for public commentary – to briefly sketch some preliminary feedback he’d heard from those people with whom he’d spoken so far. He described the need to connect “four corners,” which are: the Allen Creek greenway; the riverfront of the Huron River; the Fuller Road Station (a proposed parking garage, bus depot and possible train station); and the University of Michigan campus.

Ray Detter’s report from the downtown citizens advisory council (CAC) also focused on future planning of downtown. Detter explained that he had not attended the previous month’s DDA board meeting, because he’d been helping with tours given to 400 high school students to introduce them to the city’s history. He also plugged his annual party, which takes place on June 9.

Detter told the board that the CAC’s meeting the previous evening had included a recommitment to support transportation area planning and the Fuller Road Station – they hoped for an improved design as a result of recently acquired federal funding. The CAC continues to support the downtown planning of the Library Lot, he said. The CAC had unanimously agreed that the Library Lot should be more than a park – it should be a mixed-use development that includes an as-green-as-possible plaza. That new plaza should be connected to Library Lane – a small east-west road, just north of the downtown library building, that will connect Division and Fifth.

Whatever is approved for the Library Lot should add to the city’s tax base, Detter continued. That all sounds like “standard stuff,” allowed Detter. He told the board: “That’s our position and we’ll be sticking to it!” As for the suggestion that the city needs to go back to community for further consultation, Detter said the CAC thinks the last six years that began with the Calthorpe process has already done that. Out of that process had come a community vision and revised downtown plan and downtown parking study. Everybody had their say, Detter contended – city officials, planning staff, and the community.

The A2D2 rezoning process reinforces “our faith in planning,” Detter said. A2D2 replaces a hodgepodge of zoning districts with just two: D1 and D2. Finishing the design guidelines took an additional year, Detter said. Detter mentioned that coming up very soon, on the site of the Prescription Shop on Washington Street, another student-housing type development was being planned – the CAC hopes to be able to support that project, Detter said.

Comm/Comm: Parking Report

Roger Hewitt characterized the parking report for April 2011 as containing nothing dramatic. The 5.5% increase in revenue compared to last year reflects a parking rate increase in the 6-7% range. So overall, Hewitt said, there’s slightly less usage, but it’s essentially pretty flat.

The number of hourly patrons is up slightly. Hewitt also pointed out that the parking system has about 200 fewer parking spaces than it had a year ago – due to the loss of parking spaces because of construction. Hewitt concluded by reiterating there is nothing particularly dramatic –  it’s not growing, but it’s not clearly shrinking, either. Hewitt said there are two private developments underway [601 S. Forest and Zaragon West – previously known as Zaragon II]. So there’ll be some additional demand when they’re completed, he said. Construction on the new underground garage at Fifth Avenue will be completed by that time, Hewitt said, so the parking system will have some flexibility.

Later in the meeting, Hewitt also noted that the DDA has asked Republic Parking to take a look at generating data on “car hours.” Instead of just looking at the financial part of usage data, the DDA would like to look at actual cars in the system. The question is whether software can kick out the data that they think is already there, Hewitt said. It would be a way to measure demand, not just revenues. [.pdf of parking report for April 2011]

Comm/Comm: Parking Customer Survey

Roger Hewitt also reported on the results of a regular survey of parking system customers: 147 responses had been received in April – a 10% response rate. Of those, 41% had rated the system as excellent and 33% had rated it very good. Considering how many people normally react to surveys, Hewitt said, that’s a high percentage. He noted that typically everyone wants plenty of parking and they want it to be free.

Sandi Smith then followed up on a brief discussion of parking customer payments made by credit card, which took place during the budget adjustment deliberations. Those deliberations had drawn out the fact that increased use of credit cards by parking customers had resulted in additional fees of $7,000.

Hewitt said it reflected the fact that payment by credit card at the new on-street kiosks is being embraced by the parking public – 58% pay with credit card. Deputy DDA director Joe Morehouse said that the credit charge processing fee is 5.5%. Based on his experience operating a restaurant, Hewitt said, the smaller the charge is, the higher the percentage. Joan Lowenstein said there might be some federal legislation passed soon that could reduce that percentage.

What Smith wanted to know is if zip code data could be obtained from credit card companies, or if that information could be required at the point of payment. Morehouse indicated that he would look into that.

Smith also suggested that the board schedule an extended meeting at the end of the summer to look at the impact of the newly ratified parking contract on the DDA’s 10-year plan. Hewitt noted that the revised budget would be plugged into the 10-year plan. He also noted that under the new contract, the DDA board would need to hold a joint working sessin with the city council in October. Based on that, Smith suggested that the extended board meeting could take place on an afternoon in September.

Comm/Comm: Retail Recruitment

Reporting out from the DDA’s economic development committee, Joan Lowenstein said the committee was in a listening-and-learning mode. At the last meeting, the committee had representatives  from different downtown area associations and the Main Street business improvement zone (BIZ). Generally, business is up, but not where it was before 2008, they’d reported. They’re grateful to the DDA for help in navigating various city of Ann Arbor logistical hurdles. They’d like to see additional involvement in retail recruitment.

From Maura Thomson, executive director of the Main Street Area Association, they’d heard that business is trending up, but retail businesss have to change their approach – they can’t be just bricks and mortar. Maggie Ladd, of the South University Area Association, had reported excitement about 601 S. Forest, a residential complex that’s under construction and will offer retail floor space. It’s hoped that an anchor store can be attracted, and maybe the DDA can help with that kind of recruitment. Lowenstein said the South University area is also considering formation of a business improvement zone.

Karen Farmer had attended for Kerrytown Market & Shops, Lowenstein reported, and while there was no official representative of the State Street Area Association, committee member John Splitt [who owns Gold Bond cleaners on Maynard Street] was there.

Zaragon II – an apartment building going up at William and Thompson, and now known as Zaragon West – is anticipating more retail space. They’re looking for a resurgence of retail as more people live downtown. Ellie Serras talked about the success of the Main Street BIZ with sidewalk snow removal.

The next main project of the committee – production of a DDA annual report – will be undertaken by DDA research and planning assistant Amber Miller. It will be a glossy annual report that can be used as an informational document and as a selling point. It will describe DDA projects and their impact on the downtown, as well as giving a picture of the current state of the downtown. The report should be finished by the end of the summer or even by the end of the month, Lowenstein said.

Related to that kind of reporting, at the city council’s May 31 session of its May 16, 2011 meeting, councilmember Stephen Kunselman (Ward 3) had raised a complaint: He’d been unable to confirm that the DDA had produced the kind of reports required by the state statute under which the DDA is formed. From the Downtown Development Authority Act 197 of 1975:

(3) Annually the authority shall submit to the governing body of the municipality and the state tax commission a report on the status of the tax increment financing account. The report shall be published in a newspaper of general circulation in the municipality and shall include the following:
(a) The amount and source of revenue in the account.
(b) The amount in any bond reserve account.
(c) The amount and purpose of expenditures from the account.
(d) The amount of principal and interest on any outstanding bonded indebtedness.
(e) The initial assessed value of the project area.
(f) The captured assessed value retained by the authority.
(g) The tax increment revenues received.
(h) The number of jobs created as a result of the implementation of the tax increment financing plan.
(i) Any additional information the governing body or the state tax commission considers necessary.

In response to Kunselman’s complaint, at the council’s May 31 session, DDA board chair Lowenstein had documented an order placed with AnnArbor.com earlier this year to publish the information required under the statute.

Comm/Comm: Pedestrian Safety

John Mouat reported that the DDA’s transportation committee had discussed two topics related to pedestrian safety. They’d received a presentation from Erica Briggs, who works with the Washtenaw Bicycling and Walking Coalition (WBWC). Briggs is working on a project with a DDA matching grant to educate the public about crosswalk laws. The first step is getting a baseline, using a survey and observation.

The other issue the committee addressed was how to use limited funds in targeted areas. Mouat noted that the railroad crossing at William is in poor shape – the DDA could contribute a small number of dollars to get a federal match. On Huron Street, under the railroad tracks, there’s also an area that could be targeted. In connection to the Huron Street location, Mouat alluded to public commentary made by Bill Gross, property manager for 416 W. Huron, at the board’s February 2011 meeting. The committee had also worked on identifying trip hazards downtown, and had looked at crosswalk improvements at State and Liberty, and at Fifth and Huron.

Vegetable-shaped bicycle hoops will appear at the farmers market later in summer, Mouat said. The next meeting of the transportation committee will focus on the getDowntown program.

Invited to the podium, Nancy Shore, getDowntown’s executive director, told the board she would be presenting the transportation committee a report on the go!pass bus pass program. It’s had tremendous success, she said – the program has broken ridership records. Now that the go!passes can be swiped at the farebox for AATA buses, the program has more data about how the cards are being used. The annual commuter challenge in the month of May has also just wrapped up, Shore said.

The getDowntown program is also looking at the question of where the organization will be housed, with one possibility being at the DDA offices. It’s an issue that will need discussion by the getDowntown board, she said. Shore noted that the DDA contributes a tremendous amount to the getDowntown program, which she said has a huge impact on downtown employees.

By way of background, the getDowntown program was previously funded in a four-way partnership with the Ann Arbor Transportation Authority, the city of Ann Arbor, the DDA and the Ann Arbor Area Chamber of Commerce (now the Ann Arbor/Ypsilanti Regional Chamber). In 2009, the chamber essentially withdrew from the partnership, which meant that the getDowntown program needed to find alternate quarters – part of the contribution made by the chamber had been to provide office space. The getDowntown program then moved to offices at 518 E. Washington, with the support of the DDA. [Brief coverage of that is included in The Chronicle's report on the Dec. 2, 2009 DDA board meeting.]

Comm/Comm: Energy Grants

Sandi Smith reported that Dave Konkle had briefed the partnerships committee on the DDA’s energy grant program. The question before the committee is essentially whether to make grant awards on a first-come-first-serve basis or to make it a value-based program. Also, should the DDA try to make many smaller or fewer bigger grants? Those issues will be the focus of the June committee meeting, Smith said.

Comm/Comm: Fifth and Division

John Splitt reported that the only work being done in connection with the Fifth and Division streetscape project is on Division north of Huron: curbs are being re-aligned. On Fifth between Washington and Liberty streets, a 12-inch water main is currently being installed. Joan Lowenstein clarified that the city of Ann Arbor is doing the water main work. Splitt went on to explain that the DDA’s project would follow on that work, so that the street would not have to be repaved, torn-up, then repaved again.

Comm/Comm: Fifth Avenue Underground Parking Garage

Splitt reviewed how the underground parking project is divided into three phases: (1) the east leg – walls are complete or close to being completed; (2) the middle – slabs are still being poured; and (3) the western edge – the foundation will soon be poured, then the structure will be built up from there. Splitt described the work as “progressing nicely.” Repairs and additional reinforcement to the earth retention system will all be complete by the end of this week, he concluded.

Comm/Comm: Welcome Back

Joan Lowenstein led off the meeting by welcoming back Susan Pollay, the DDA’s executive director who’s been out on medical leave for a few weeks.

Susan Pollay, executive director of the DDA, has returned to action.

The board responded with applause. Lowenstein told Pollay, “We all feel great seeing you there.”

Lowenstein said the board also felt great seeing Joe Morehouse, deputy director of the DDA who’s filled in for Pollay in her absence. But she ventured that no one is happier than Morehouse to have Pollay back.

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

Absent: Newcombe Clark, Keith Orr

Next board meeting: Noon on Wednesday, July 6, 2011 at the DDA offices, 150 S. Fifth Ave., Suite 301. [confirm date]

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At Fourth & William streets in downtown Ann Arbor. The view is looking to the north. At right is an AATA bus shelter – further in the background on the same side of the street is the Blake Transit Center. Opposite the AATA facilities is a parking deck. (Photos by the writer.)

At the transportation committee meeting, Susan Pollay, the DDA’s executive director, floated an idea for partnering with the Ann Arbor Transportation Authority on improvements to the South Fourth Avenue corridor, between William and Liberty streets. The partnership would include a grant to the AATA in connection with the reconstruction of the Blake Transit Center. No numbers are yet attached to the concept, which Pollay described as a possible “transit mall” – she was checking with the committee for their basic reaction to the idea. That reaction could fairly be described as warm, with some caution expressed by DDA board member Leah Gunn, when she arrived for the operations committee meeting.

Starting last month, the last half hour of the  transportation committee’s meeting has been configured to overlap with the operations committee’s meeting, so that the two groups can meet jointly to discuss a directive from the city council to the DDA to deliver a parking plan to the council by April. A preliminary outline of that plan was discussed on Wednesday.

Fourth Avenue

When DDA executive director Susan Pollay articulated the concept for creating something like a “transit mall” along Fourth Avenue on Wednesday morning, it was not the first time transportation committee members had heard the idea. As a part of The Chronicle’s coverage of the AATA board’s December meeting, we reported on last month’s DDA transportation committee meeting as well:

At the Downtown Development Authority’s transportation committee meeting earlier in the day, executive director Susan Pollay had focused on the 50% of those passengers who did not transfer, but rather had downtown Ann Arbor as a destination point. The DDA, she said, needed to make sure that for those passengers, the area around the Blake Transit Center was a welcoming place. DDA board member Newcombe Clark concurred with Pollay’s suggestion of putting “everything on the table” – including Fourth Avenue as a transit hub, possibly integrating the Fourth and William parking structure, with getDowntown offices constructed in that structure. [For the complete Chronicle article, see "AATA Board: Get Bids to Rebuild Blake"]

At Wednesday’s meeting, Pollay offered the idea in somewhat more concrete form, though it could fairly be described as still conceptual. Her goal, she said, was to see if the idea resonated with the transportation committee, before trying to attach some dollar figures to it.

The Jan. 27 DDA transportation committee meeting. Starting at the near corner moving clockwise: DDA executive director Susan Pollay; board members John Mouat, Joan Lowenstein, Keith Orr, Gary Boren, Jennifer Hall; getDowntown director Nancy Shore; city of Ann Arbor forester Kerry Gray; DDA intern Amber Miller.

The concept includes four elements. First, it would include a grant to the AATA in connection with the reconstruction of the Blake Transit Center, which is located on that block. The current conceptual design for the new BTC is for it to be a two-story building located on the same footprint as the current one-story facility.

The DDA grant to the AATA would go towards providing additional structural support in the new facility, so that additional stories could be added later – possibly in concert with development that might happen on the old YMCA lot, which directly abuts BTC to the south.

A second element of the concept would include installation of pedestrian-friendly amenities along the block, like trees and planters, or colorful banners and the like. A third element would be informational electronic signs mounted on the Fourth and William parking structure facing BTC, so that bus passengers could see arrival and on-time data for the next buses.

A final element of the transit mall concept would include building out the ground floor of the Fourth and William parking structure to accommodate retail/office space, to give the corridor a more human feel and generate more activity there. Offices for getDowntown was a specific suggestion – that organization recently relocated to Washington Street office space when the Ann Arbor Area Chamber of Commerce ended their arrangement to provide in-kind support.

Transportation committee member John Mouat suggested that a place for the AATA board to meet could be a part of the space built out in the parking structure. Finding a location for the AATA board that is more accessible to the public than their current board room at AATA headquarters on South Industrial Avenue has become a priority for the AATA.

About the concept Pollay said, “I’m feeling ambitious,” and the transportation committee seemed to concur in principle. Pollay will now work with deputy director Joe Morehouse to develop some dollar figures and present those to the transportation committee at its February meeting. At that point, the committee could choose to send a recommendation to the full board.

If a recommendation comes to the full board that includes building out retail/office space in the parking structure, board member Leah Gunn will likely need to be convinced that commercial enterprises that might use the new space would not be subsidized to compete with other businesses. That was the sentiment she conveyed later during the joint transportation and operations committee meeting, which followed the transportation committee’s session. [Gunn serves on the operations committee.]

Chronicle readers might have already seen Gunn’s view on the subject. She left a comment following a recent Chronicle article about the closing of the John Leidy shop, expressing much the same sentiment:

And who is to say that an existing business should not be helped as much as a “start-up” business? (Could your tax money have kept Shaman Drum or John Leidy open?) [link]

Parking Report

At their last meeting of 2009, on Dec. 21, the city council approved its part of an arrangement with the DDA that would direct net revenue from the surface parking lot at the old YMCA site to the city of Ann Arbor. [See Chronicle coverage: "Also: Most aspects of parking deal approved"] The DDA agreed to the deal at its Jan. 6 meeting. [See Chronicle coverage: "DDA Ponies Up: Parking, Pipes, Planning"]

Originally part of the city council’s Dec. 21 resolution was an extension of evening enforcement of parking meters downtown, but that was swapped out in favor of a resolution calling on the DDA to provide the city council with a plan:

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

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

So on Wednesday, a draft outline of the presentation was discussed by the joint assembly of the transportation and operations committees of the DDA board.

The outline of the presentation was a comprehensive look at the entire parking program of the DDA – in terms of the city council resolution, it appears that the “not limited to” language is being taken seriously. Leah Gunn remarked: “I don’t think the council realized how big an assignment they gave us.”

Executive director Susan Pollay clarified for committee members that the outline was far more comprehensive than what the city council had asked for – the DDA was taking the opportunity to provide a complete overview. She reminded the committee, however, that the audience for the April presentation – the city council – would be listening for some very specific information: How much revenue would evening enforcement generate?