Comparing the periods October 2012 through June 2012 to October 2013 through June 2014 – when rates have been constant – revenue has increased 1.20% to $14,647,274, while the number of hourly patrons has decreased by 1.65% to 1,661,256. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

What if on-street metered rates were raised a dime, and rates across other parts of the parking system were also raised by an equivalent percentage?

Although the DDA operates the parking system, that kind of 6.7% rate increase would directly benefit the city’s general fund. By how much?

First, any increase to the city’s general fund revenue is a function of the contract with the city of Ann Arbor, under which the DDA operates the roughly 8,000-space public parking system. The contract stipulates that the city receives 17% of gross parking system revenues.

Total parking system revenues are budgeted by the DDA for the 2015 fiscal year at about $19.3 million. So in ballpark numbers, the 17% equates to a roughly $3.2 million transfer to the city. Of that $3.2 million, about $2.3 million will go to the general fund, while the remaining amount will go to the fund the city uses to maintain downtown streets. That division of the transfer payment by the city has its historical roots in an arrangement between the city and the DDA that predated the existing contract.

So a 6.7% increase in rates across the parking system – assuming no decrease in the use of the system – works out to something like $150,000 more for the city of Ann Arbor’s general fund.

The city council’s role in setting parking rates is one of oversight, not decision-making. But even that oversight role is structurally somewhat weak – because decisions made by the DDA (to raise parking rates) can make the city council’s annual budget decisions somewhat easier.

The next scheduled opportunity for the Ann Arbor city council to exercise oversight of the DDA will be during a fall joint work session – which is stipulated to occur under terms of the city-DDA parking contract. That session is currently planned for Sept. 8.

The contractually stipulated work session would be a good opportunity for councilmembers to ask for metrics on Ann Arbor’s public parking system. Requested information should include stats that indicate how well Ann Arbor’s public parking system supports three different key user groups: (1) downtown employees; (2) retail/transactional customers and visitors; and (3) downtown residents.

Some data is collected routinely by the DDA from Republic Parking – its contractor for day-to-day operations – and shared publicly. That data is limited to revenue figures and numbers of hourly patrons. The routine data does not include hours parked by different categories of users – monthly permit holders and hourly patrons – which makes it difficult to evaluate the system’s support of different user groups.

Still, it’s possible to discern some patterns and to draw some conclusions about Ann Arbor’s parking system, based on the data the DDA does provide. Charts with commentary are presented below.

Overall Picture

The most recent rate increases in Ann Arbor’s public parking system were implemented in September 2012.

Rates for the roughly 2,000 on-street metered parking spaces are currently $1.50 an hour. Rates at surface lots straddle that $1.50 hourly rate – at $1.40 for the first three hours and $1.60 for the fourth hour and beyond. Hourly parking at parking structures costs $1.20 per hour. Monthly permits – which don’t guarantee a permit holder a specific space, but are tied to a particular structure – cost $145 a month at most structures.

Some, but not nearly all, of the monthly permits sold in the two-year-old underground parking garage at Library Lane were initially sold at a discounted $95 introductory rate, which reflects a $50 savings over most other structures. The discount was offered to employees of “new-to-downtown businesses” and to permit holders in the Maynard or Liberty Square parking structures who were willing to transfer their permit to Library Lane. The pricing is good through August 2014. Assuming all those discounted Library Lane permit holders retain them after August 2014, revenue per space at Library Lane should show a slight increase.

The most recent revenue data from the Ann Arbor DDA on Ann Arbor’s parking system is through June 30, or the end of the fiscal year 2014. The most recent three fiscal quarters provide the most meaningful year-over-year comparison – because of the rate increase that was implemented in September 2012.

The most recent data is consistent with the parking reports over the last several years, when interpreting the data has required accommodation of rate increases: Revenue has increased even while the number of patrons who pay the hourly rate in structures or on surface lots has decreased. Hourly patrons don’t include those who park at on-street meters. Specifically, comparing the last three quarters of the most recent fiscal year to the last three quarters of the previous fiscal year, revenue has increased 1.20% to $14,647,274, while the number of hourly patrons has decreased by 1.65% to 1,661,256.

In Chart 1 and Chart 2 below, the recently concluded fiscal year 2014 is indicated in dark purple.

Chart 1: Total System Revenue. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Chart 2: Total Count of Hourly Patrons. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Monthly Permits: Are Fewer Hourly Patrons Staying Longer?

The consistent narrative offered by the DDA to account for the increase in revenues – despite a decreased number of hourly patrons – has been told along the following lines: Even though fewer hourly patrons are visiting downtown, they are parking for a longer time.

It’s possible to ask two basic questions about that narrative: (1) Is it meaningful? and (2) Is it accurate?

In order for the narrative to be meaningful, it’s important to understand how hourly patrons are using the parking system. If hourly patrons are exclusively retail shoppers of some stripe, then the fact that retail shoppers are staying in the downtown longer now than they were in the past could be analyzed as good news for downtown retail establishments. On the other hand, if hourly patrons include a significant number of downtown employees – people who would prefer to hold a monthly permit, but who have been languishing on the wait list – then this might indicate that employees are crowding out retail shoppers.

In order test the narrative for accuracy, it’s important to recognize that hourly patrons are not the only source of revenue to the parking system as a whole. For example, on-street metered parking by itself provided about $3 million of revenue in the most recent three fiscal quarters – but that that type of parking does not contribute to the count of hourly patrons. If the revenue from parking meters and bags is subtracted from the total revenue figure, there’s still an increase – in fact, a greater percentage increase than across total revenues. The $11,529,132 collected for the nine months from October 2013 through June 2014 is about 2% more than was collected from October 2012 through June 2013.

Chart 3 below shows clearly that if on-street metered parking is considered as a facility, then it easily generates the highest gross revenue of any facility in the system.

Chart 3: Revenue by Facility. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

It is not as straightforward to test the DDA narrative for accuracy with respect to facilities that offer monthly permits as well as hourly parking – where those hourly patrons are counted. The revenue division between monthly permits and hourly patrons is not reported and apparently not analyzed by the DDA. So some of the total revenue increase might be attributable to increased optimization of the oversell margin for monthly permits in parking structures. Many structures show more monthly permits sold than they have spaces. The number of monthly permits sold in the entire system, as well as the percentage of the total inventory, shows a slight but clear upward trend over the last three years.

The DDA does not report monthly permit data broken down by permit type – regular, evening/overnight or premium – which might otherwise help to identify how well users of the public parking system are being served.

Monthly permit data is presented in Charts 4, 5 and 6 below.

Chart 4: Permits as Percentage of Inventory by Facility. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Chart 5: Total Inventory and Total Permits. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Chart 6: Monthly Permits as Percent of Inventory. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

For some facilities – like the surface lots at Huron/Ashley/First (the Brown Block) and at South Ashley (the Kline Lot) – no monthly permits are sold. So it’s possible to calculate average payments per patron at those facilities. And both of those facilities show evidence that a fewer number of patrons are generating more revenue, and that their average stay has become slightly longer.

Average payments per patron for Huron/Ashley/First and the Kline Lot are presented below in Charts 7 and 8.

Chart 7: Huron/Ashley/First Average Payment Per Patron. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Chart 8: Kline Lot Average Payment Per Patron.  (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Revenue Per Space

The DDA does not calculate revenue-per-space figures. And the DDA has reduced the frequency of its reporting about the number of spaces at a facility – from monthly to quarterly. So the charts below are constructed based on estimates, using previous number spaces. In any case, most facilities have a stable number of spaces and vary at most by a handful, due to special temporary circumstances.

A couple of clear patterns emerge from the plots of revenue-per-space figures. One is that easily the highest revenue per space (though not per acre of land) is generated by the two surface lots on the west edge of downtown – Huron/Ashley/First and the Kline Lot.

Another trend is that the new Library Lane underground parking garage appears to have achieved a kind of equilibrium in its usage. Library Lane has settled in a bit higher than the lowest performing significant facility in the system in terms of the revenue-per-space metric – which is the on-street metered facility. Library Lane achieved what appears to be its current stable level of usage within nine months of opening.

The on-street facility shows a clear bump for April this year. That coincides with the closing of the Fifth and William surface lot, after it was purchased from the city by Dennis Dahlmann. However, it’s not clear what caused the April increase in revenue to the on-street metered system.

Chart 9: Revenue per Space, Focus on Structures. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Chart 10: Revenue per Space, Focus on Surface Lots. (City of Ann Arbor public parking system data from the Ann Arbor Downtown Development Authority, charts by The Chronicle.)

Conclusions

Given the kind of parking data currently collected, analyzed and reported by the DDA, it’s not possible to get a very clear understanding of how Ann Arbor’s public parking system is currently supporting three different key user groups: (1) downtown employees; (2) retail/transactional customers and visitors; and (3) downtown residents.

The DDA could improve its understanding of the system by collecting, analyzing and reporting data on hours parked by monthly permit holders as compared to hourly patrons. The hours parked by permit holders should be further broken down by permit type. The DDA could also improve its understanding of the on-street metered system by collecting, analyzing and reporting usage by individual meter – a straightforward possibility at least for those meters that are paid for using the relatively new kiosks.

Certainly there are other fiscal policy issues at stake as the DDA evaluates whether parking rates should be increased. For example, are current revenue levels adequate to pay for existing debt on past construction, the go!pass bus pass program, ongoing maintenance and a possibly $5 million renovation to the Fourth and William Structure? In its oversight role, the city council should certainly include consideration of these basic financial issues.

I’m reasonably confident that the council will exercise appropriate oversight with respect to the purely financial question: Will there be enough money and how much does the city get?

But without a clearer understanding of how the parking system supports different user groups, it will not be possible to measure the impact of a price increase on those user groups.

So at the joint city council-DDA work session on Sept. 8, I hope the city council will include in their oversight role a request for data and metrics that will help answer this question: How does Ann Arbor’s parking system actually work?

Floor 7 at the southwest elevator of the Fourth & William parking structure in downtown Ann Arbor. (Photos by the writer.)

The elevator in question is located at the southwest corner of the Fourth & William parking structure. The 994-space capacity makes it the largest structure in Ann Arbor’s public parking system, which offers around 8,000 parking spaces in lots, structures and on-street, metered parking.

The elevator is at least 30 years old, and was characterized at the meeting by DDA executive director Susan Pollay as one of the slowest in the Ann Arbor area, and the frequent subject of parking patron complaints. A trip from street level to floor 7 was timed by The Chronicle at about 45 seconds. That compares to 17 seconds for a similar trip on the elevator at Fourth & Washington, which is the DDA’s second-newest structure.

The board’s Jan. 8 resolution authorized $40,000 for Carl Walker Inc. to develop architectural renderings for the work at the Fourth & William parking structure. Carl Walker is the consulting firm used by the DDA for its routine maintenance inspection program for the parking structures. The design is supposed to allow for phased construction so that the parking structure could remain open during the construction period, which would not begin before next winter. The estimated construction cost for the project is $2.25 million.

In its other main business item, the board voted to allow the developer of the future 624 Church St. project in downtown Ann Arbor to extend for up to 15 years – for a total of 30 years – the contracts for 48 already-approved parking permits under the city’s contribution-in-lieu (CIL) program. At its meeting on Nov. 6, 2013, the DDA board had already approved the purchase of 48 parking permits through that CIL program for a new version of the proposed residential development at 624 Church St. in downtown Ann Arbor.

The spaces were approved to be provided in the Forest Avenue parking structure. The DDA board’s Jan. 8 resolution indicated that for the extension periods, the DDA might choose to allocate the spaces in some other structure than the Forest facility.

In an update at the meeting also related to parking, city administrator Steve Powers said that the surface parking lot at the former Y site would need to be closed no later than March, due to the sale of the city-owned property to Dennis Dahlmann. The property is located on the north side of William Street, between Fourth and Fifth avenues near the Blake Transit Center and downtown library.

The board also received an update on its initiative to pay for downtown ambassadors. And board members were alerted to the upcoming Jan. 13 city council work session about economic development.

Preliminary Design: Fourth & William Elevator

The board considered a resolution authorizing preliminary design work costing $40,000 for a new elevator and stair tower on the southwest corner of the Fourth & William parking structure.

Fourth & William parking structure elevator/stair tower on Jan. 7, 2013. (Photo by the writer.)

The resolution tasked Carl Walker Inc. to develop architectural renderings for the work at the Fourth & William parking structure. Carl Walker is the consulting firm used by the DDA for its routine maintenance inspection program for the parking structures. The funds for the design work are to be drawn from the parking fund, not the DDA’s tax increment finance (TIF) revenue.

The Fourth & William parking structure is described in the board’s resolution as the largest one in Ann Arbor’s parking system with elevators that are more than 30 years old and inadequate to meet customer demand.

A recent trip from the ground floor to floor 7 was timed by The Chronicle at 45 seconds. The comparable trip at the newer Fourth & Washington parking structure took about 17 seconds.

Regular parking customer satisfaction surveys reflect the fact that the elevators are slow. Some sample comments from survey results reported in early 2012 include: “Elevators way too slow. Stairwells dirty on upper floors. Too much constant construction.” and “Elevators are slow so usually take the stairs.”

The Fourth & William structure has 994 spaces. Since 2011, the structure has generated a rough average of $210,000 in gross revenue per month. According to DDA financial records, after expenses and debt service on bonds associated with the structure, the Fourth & William structure generated $293,929 in income for FY 2013.

The board’s Jan. 8 resolution indicated that to keep the facility open during the elevator tower renovation, a phased construction plan would be used. Construction would not be expected to begin until next winter.

Preliminary Design: Fourth & William Elevator – Board Discussion

John Splitt introduced the resolution on the Fourth & William elevator.

DDA board member John Splitt.

Splitt characterized the resolution as taking the DDA to the next step of developing the plan to replace the elevator and stair towers at the Fourth & William parking structure. The elevator and stairway are original to the structure, he said. The DDA had some preliminary discussions with Carl Walker – and based on those conversations, the construction will need to be phased so that there’s an elevator and stair available at all times. It should also be phased so that it’s as much as possible not disruptive to the neighborhood. The resolution authorizes $40,000 for the next phase.

John Mouat asked Splitt to clarify that this is still the design phase. Splitt noted that there’s a lot of work that goes into even this preliminary phase, because you have to know where electrical systems and everything else are going.

Board chair Sandi Smith characterized the southwest corner of the parking structure as very dull but a very prominent corner. She encouraged Carl Walker to make the design more of a “signature piece.” She would be much happier, she said, if the result was something more than just a new stairway. Splitt concurred, saying that the idea is to consider “opening it up” and putting in as much glass in as possible.

City administrator Steve Powers noted that the DDA has a capital improvement plan, and the elevator is included as a part of that plan. [In the course of the debate that unfolded in 2013 about a revision to the city's ordinance the regulates the DDA's TIF capture, the DDA developed a draft of a five-year plan of projects. The ordinance revision eventually passed by the city council, on Nov. 18, 2013, requires the DDA to "submit their capital budgets to incorporate them into the City’s capital improvement plan (CIP)." The state's DDA Act requires – as a part of a DDA's TIF plan – a development plan that includes a description of improvements to be undertaken, with cost estimates and a description of construction phasing. The DDA's 2003 TIF plan adopted by the city council does not appear to contain the kind of detail indicated by the state statute.]

Powers asked DDA executive director Susan Pollay to comment on the elevator tower construction project in the context of the DDA’s five-year capital improvements plan. Pollay indicated that the Fourth & William parking structure was included in that plan. [The five-year project draft document puts the estimated cost of construction at $2.25 million.] The Connecting William Street planning project had highlighted the importance of the parking structure, she said. She also pointed out the link between the Kline surface parking lot at Ashley and William, the Palio lot at Main and William, and the Library Lane parking structure between Fifth and Division, north of William. Pollay characterized the elevator as perhaps the slowest elevator in the whole Ann Arbor area.

Maura Thomson, executive director of the Main Street Area Association, literally stuck to her knitting in the audience as the DDA executive director spoke of the figurative knitting together of various initiatives associated with the Fourth & William parking structure.

It would take about 6-8 weeks to replace the elevator, Pollay said, but the parking structure can’t function with just one elevator, on the north side of the facility. So the DDA is exploring the idea of undertaking the construction in a phased way. She noted that it’s not a very attractive garage, so the DDA is looking at how to enhance its appearance from Main Street. Pollay also described the eventual possibility of building out the ground floor on Fourth Avenue one bay deep to provide commercial space of some kind. It would animate the sidewalk, she said, noting that the block needed to gain back human beings.

Pollay continued by saying that as long as that part of the parking structure was being built out, it would be necessary to add electrical capacity, which ties into electric car charging projects. The impetus for all these various initiatives is the elevator project, she said. Having renderings to look at will help to knit them together, Pollay indicated.

Smith asked if this project would be included in the city’s capital improvement plan. Splitt indicated that it was. Splitt also pointed out that there’s an estimated 30-50 more years of useful life in the structure, so investing in the new elevator made sense.

Al McWilliams asked if there was particular urgency to replace the elevator. Splitt responded to McWilliams by saying that no actual construction would be scheduled until next winter. Pollay added that there was no urgency in the sense that the elevator was failing, but the regular feedback from customer surveys is that the elevator is too slow. The work is planned for the winter, to reduce the impact of construction noise and to be as unintrusive on Main Street businesses as possible.

Outcome: The resolution on the elevator design passed unanimously.

624 Church Street Parking Permit Extensions

The board considered a resolution that would allow the developer of the future 624 Church St. project in downtown Ann Arbor to extend for up to 15 years – for a total of 30 years – the contracts for 48 already-approved parking permits under the city’s contribution-in-lieu (CIL) program.

At its meeting on Nov. 6, 2013, the DDA board had already approved the purchase of 48 parking permits under the CIL program. Those permits were for a new version of the proposed residential development at 624 Church St. in downtown Ann Arbor. The spaces were approved to be provided in the Forest Avenue parking structure. The DDA board’s Jan. 8 resolution indicated that for the extension periods, the DDA might choose to allocate the spaces in some other structure, not necessarily the Forest facility.

The CIL program allows a developer the option of purchasing permits to satisfy a parking requirement that would otherwise be satisfied by providing parking spaces on-site as part of the project. The request for an extension on the CIL monthly parking permit contracts was driven by an interest in the financial backers of the project to see contracts in place that would cover the 30-year period of a mortgage.

Brad Moore, architect for the 624 Church St. project, had appeared before the DDA board at its Dec. 4, 2013 meeting to request the ability to extend the contracts on the 48 permits for up to two 10-year periods past the standard 15-year period associated with the city’s CIL program. After discussing the matter, the board opted at that meeting to table the question. The Jan. 8 resolution gave extension options that were in total 5 years shorter than what Moore had requested, but still covered the 30-year financing period that had motivated the request for the ability to extend the contracts.

The original proposal for the 624 Church St. project, which received site plan approval from the city council at its March 4, 2013 meeting, was for a 13-story, 83-unit apartment building with approximately 181 beds. And for that version, the Ann Arbor DDA had authorized the project to purchase up to 42 monthly permits through the city’s CIL program.

The newly revised 624 Church St. project, which received a recommendation of approval from the city planning commission on Dec. 17, 2013, is larger than the original project, with roughly 122 units and 232 beds. The parking requirement is a function of the by-right premiums for additional square footage beyond the basic by-right of 400% floor area ratio (FAR). So the parking requirement for the revised project is greater than for the original version of the project. That’s why the DDA was asked to increase the number of permits from 42 to 48. The number of required parking spaces for the revised version of the project is actually 53, but five of them will be provided on site. The overall revised project still requires city council approval.

The DDA makes the decision about whether there’s adequate capacity in the parking system to allow the sale of additional monthly permits – because the DDA manages the city’s public parking system under a contract with the city.

Ann Arbor’s “contribution-in-lieu-of-parking” program was authorized by the city council on April 2, 2012. That program allows essentially two options: (1) purchase monthly parking permits in the public parking system for an extra 20% of the current rate for such permits, with a commitment of 15 years; or (2) make a lump sum payment of $55,000 per space. It’s option (1) that the 624 Church St. project is using.

624 Church Street Parking Permit Extensions: Public Commentary

Sean Spellman with The Opus Group – which is partnering with the Tice family on the 624 Church Street project – addressed the board during public commentary at the start of the board meeting. He told the board that he was in attendance so that he could answer any questions they might have about the agenda items regarding the parking permits. Spellman raised some issues with respect to the wording in one of the “whereas” clauses of the resolution – but it turned out that his concerns were based on a draft version. The issues he raised had been addressed in the final version of the resolution.

624 Church Street Parking Permit Extensions: Board Discussion

Roger Hewitt introduced the resolution. He then reviewed the issue of the project’s financing and how it was tied to the ability of the project owners to extend the parking agreements to a total of 30 years – beyond the 15 years normally associated with the CIL program.

DDA board member Roger Hewitt.

Hewitt noted that for the period of the extensions, the spaces could be reallocated to other facilities besides the Forest structure. Hewitt felt very strongly that the DDA needs to have some flexibility in the system. The DDA needs to be careful about what the system is going to look like 30 years from now, he said. He assured his colleagues that the system today is very different from what it was 30 years ago.

If the downtown housing boom continues, he said, the parking system will not have the space to warehouse all the cars. So the current DDA needs to let future boards and future parking operators have some flexibility. Hewitt was reluctant to tie up spaces for 30 years.

Hewitt was willing to bend and give the option to extend for the three additional five-year periods, but he reiterated the need to keep flexibility.

Outcome: The resolution on the extension of the 624 Church Street parking permits passed on a unanimous vote.

Communications, Committee Reports

The board’s Jan. 8 meeting included the usual range of reports from its standing committees and the downtown citizens advisory council.

Comm/Comm: City Council – Economic Development

City administrator Steve Powers alerted the DDA board to a city council work session to be held on Jan. 13. The focus of the session will be on economic health – Powers reported that the council had reaffirmed that as a priority area for the coming year.

Later in the meeting, John Mouat reported on the work that a joint economic development task force has been doing. He noted that the group had been meeting for several months now. Powers had drafted a document and DDA executive director Susan Pollay had “worked it up a little,” Mouat said. It would be a kind of “action plan” describing things that different entities can purse. Those entities, Mouat said, were the city of Ann Arbor, the Ann Arbor DDA, and the economic development entity Ann Arbor SPARK.

With respect to the DDA’s tasks, it was all work that falls within the purview of work the DDA has done before, he said. Mouat said he’d be interested to see how it’s received at the Jan. 13 work session and how the city council wants to move forward with it. Mouat made two general comments on the work. There are specific action-plan items about things that might get done. But there’s also a chance to change the culture of the community a bit with respect to economic development, he said. Mouat felt that the phrase “economic development” had acquired a negative connotation. He said he also did not care much for the phrase. He felt that it simply has to do with jobs and vitality and the general health of the community. The more the community can be helped to think of it in terms of jobs and vitality, then that’s a good thing, he said.

Powers followed up on Mouat’s remarks by saying that the city council has renamed the priority area to “economic health,” partly for the reasons that Mouat had mentioned. The city pays most of its bill through taxes on the value of the real estate in the city, he noted. So having development is important to the city’s ability to deliver services, he said. The work session on Jan. 13 is intended to provide some discussion about some of the larger economic issues. The work session should also include some specific actions the city could take. The task force so far has helped to frame those actions, as well as the larger policy considerations for the council.

Sandi Smith said the other component of the conversation is the idea that it’s not economic development for the sake of doing it, but to increase the level of services and the quality of life that we enjoy. The point is not to generate dollars, she said, but to make everything better for all the residents of Ann Arbor.

Comm/Comm: City Council – Goals

Reporting out from the partnerships committee, Joan Lowenstein said that they’d heard at their meeting from representatives of the city council about the results of the council’s planning session – which included basic services focused on neighborhoods and quality of life. Lowenstein hoped the council would work to define “some specific parts of those things they would like to see,” she said. [The two city council representatives on the DDA's partnerships committee are Jane Lumm (Ward 2) and Margie Teall (War 4). Councilmember Stephen Kunselman (Ward 3) had volunteered to serve in that capacity in November 2013, but was not appointed to the committee. ]

Comm/Comm: getDowntown

Reporting out from the operations committee, John Splitt said that getDowntown executive director Nancy Shore would attend the next committee meeting to talk about the Ann Arbor Area Transportation Authority’s Route #4 and Route #5 from Ypsilanti. [The presentation from Shore will likely lay the groundwork for a request to the DDA to fund the go!pass for the coming year.]

Comm/Comm: Ambassadors

By way of background, for several years the Ann Arbor DDA has had an interest in maintaining some kind of additional patrol presence in the downtown. In the mid-2000s, the DDA entered into a contract with the city of Ann Arbor with the implicit hope that the city would maintain its dedicated downtown beat cops. That contract was structured at that time to pay the city $1 million a year for 10 years, with the city able to request up to $2 million a year for a maximum of $10 million.

That hope was not realized, and the DDA has since discussed the idea of providing additional funding for police or for ambassadors. The idea of “ambassadors” was explored in the context of subsequent re-negotiations of the contract between the city and the DDA under which the DDA operates the parking system. The DDA wanted to be assigned responsibility for parking enforcement – a function performed by the city’s community standards officers. Board members imagined that this activity could be performed in an ambassador-like fashion.

At its June 3, 2013 meeting, the city council approved a resolution encouraging the DDA to provide funding for three police officers (a total of $270,000 annually) to be deployed in the DDA district. The DDA is pursuing the idea of ambassadors. Several DDA board members made a trip to visit Grand Rapids last year, a city that has recently launched an ambassador program.

At the board’s Jan. 8 meeting, Roger Hewitt gave an update on the DDA’s initiative to fund downtown ambassadors. Ann Arbor police chief John Seto and Sgt. Tom Hickey had attended a recent meeting of the operations committee. Concerns had been raised about how communication between the ambassadors and police officers would work, so that issue had been discussed. Hewitt said that the committee had now asked Susan Pollay to come up with a request for qualifications (RFQ) for a company to provide the ambassador service. That would allow the DDA to gather more information and at some point come back to the full board with a recommendation.

John Mouat added that he found it interesting to hear from Seto and Hickey that AAPD is already accustomed to dealing with volunteers in connection with special events. So he felt the ambassador program could be made to work pretty well.

Comm/Comm: Former Y Lot

Board chair Sandi Smith asked city administrator Steve Powers for an update on the former Y lot.

Ann Arbor city administrator Steve Powers, who also serves on the DDA board.

[The context for Smith's request was the recent sale of the former Y lot by the city of Ann Arbor to Dennis Dahlmann. The parcel is currently used as part of the public parking system, which the DDA manages under a contract with the city. The equipment that has been installed there will eventually need to be removed. At one point it was thought the lot would be closed by the end of 2013.]

Powers indicated that the lot will need to be closed no later than March. Smith received a clarification that the parking equipment is still installed and operating.

With two to three days of lead time, all the equipment could be removed. The equipment at that lot is relatively new, so some of it could be installed at other lots with older equipment.

Comm/Comm: CAC, Downtown Zoning

Ray Detter reported out from the downtown area citizens advisory council. He congratulated the DDA and executive director Susan Pollay for the recent opening of the City Apartments project at First & Washington. [That residential complex includes public parking in the lower levels.] That project had taken a long time, and hopefully it will be real success, Detter said. He also complimented the Kingsley Lane and Kerrytown Place projects.

Detter said he wanted to focus his remarks on the recent recommendations that the planning commission had made on possible revisions to downtown zoning regulations. He said that the CAC has all along supported zoning changes consistent with the 2009 downtown plan goal of encouraging zoning and design approaches that minimize negative impacts on neighbors in terms of height, scale, shading and harm to natural and historic resources. He believed that Erin Perdu’s consulting group did a great job at getting the community involved in the review process. Detter also said that the planning commission had done a good job, even if he didn’t agree with everything that had been recommended. The city council will ultimately decide how to proceed, he noted.

The planning commission recommends rezoning the parcel located at 336 E. Ann St. from D1, which would allow an 18-story building right across the street from a historic residential neighborhood, Detter said. He called the D1 zoning a terrible mistake. The CAC recommends the rezoning of that one parcel to D2 be extended along Ann Street all the way to North Fourth for the sake of consistency. The second point Detter noted was the planning commission recommendation to reduce the height in the East Huron I character area – on the north side of Huron Street between Division and N. State Street – to 120 feet, and to include a tower diagonal maximum and consider setback requirements to reduce shading on residential properties.

Detter said that Dennis Dahlmann, who owns the property on East Huron between Sloan Plaza and the Campus Inn, supports that change, even though the proposal would downzone his property from 150 feet to 120 feet. Detter said that the CAC recommends extending that reduced height all the way to North Fourth. Even though the city council had not given direction to do so, he noted, Erin Perdu’s group had made a recommendation that the property at the northwest corner of Huron and Division, where Ahmo’s Gyros and Deli is located, be zoned with a height limit of 120 feet.

Later in the meeting, city administrator Steve Powers followed up on Detter’s remarks about the zoning issue, by pointing out that it would be an item on the council’s Jan. 21 agenda.

Comm/Comm: Communications, Marketing

Reporting out for a communications and marketing subcommittee, Rishi Narayan said that he and Al McWilliams had been newly tasked to focus on communications – and they were really trying to figure out how to explain to people what it is the DDA does.

DDA board member Rishi Narayan checked his smartphone before the meeting started.

They’d discussed the idea of partnering with the downtown merchant associations, many of whom are already doing a lot to market and promote their areas. Some of the associations are member-driven, he said, while others are not. Narayan wanted to start by figuring out the DDA’s role – in communications or trying to bring everyone together. He said they didn’t want to reinvent the wheel.

McWilliams added that over the years, the DDA had talked a lot about doing more data and information collection. They’re looking at ways to make that data more useful. Many of those assets are already in place, he said.

Joan Lowenstein noted that for the next meeting of the partnerships committee, representatives of the merchant associations had been invited to attend. John Mouat ventured that it would be a good idea to invite the Ann Arbor Area Convention and Visitors Bureau to attend as well. Narayan agreed, but indicated the committee felt that instead of having everyone attend at once, they would invite others to subsequent meetings.

Narayan thought McWilliams had brought up a good point: What is the data and information the DDA has that can help downtown businesses tell their story?

Comm/Comm: New Year’s Events

City administrator Steve Powers noted that as everyone knew, the city had hosted two significant events over the New Year’s holiday – on New Year’s Eve and New Year’s Day. [A New Year's Eve event called The Puck Drops Here was held downtown, and the NHL's Winter Classic game between the Detroit Red Wings and Toronto Maple Leafs was held at Michigan Stadium on New Year's Day.] Overall the response had been very positive on both events, he reported. About the traffic control challenges, Powers said it was fortunate the fans were well-behaved and made it to Tim Hortons without any serious injury, he quipped. Powers thanked the DDA for its support of those events through the parking system.

Not mentioned at the meeting were some problems reported on New Year’s Eve in connection with patrons trying to exit, more or less all at the same time, from the newly constructed Library Lane structure. [.pdf of email correspondence between DDA executive director Susan Pollay and Kai Petainen] Petainen reported that he’d waited 45 minutes to exit after paying for his time, which meant that he had to pay again when he reached the exit.

The final email in the chain shows Petainen thanking Pollay for her detailed response and sharing some positive remarks about the NHL’s Winter Classic generally: “I should note that more things went right than wrong during the Winter Classic. A few days ago I was in a taxi ride in Toronto. The taxi driver had been to the game! I actually heard overheard others (strangers) talking about it as well! I heard them at the Tim Hortons, at the airport and on the street. The event was a big deal to Toronto, as much as it was a big deal to Ann Arbor.”

Present: Al McWilliams, Cyndi Clark, Roger Hewitt, Steve Powers, John Splitt, Sandi Smith, Rishi Narayan, Joan Lowenstein, John Mouat.

Absent: Bob Guenzel, Russ Collins, Keith Orr.

Next board meeting: Noon on Wednesday, Feb. 5, 2014, at the DDA offices, 150 S. Fifth Ave., Suite 301. [Check Chronicle event listings to confirm date.]

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Ward 3 councilmember Stephen Kunselman (left) attended the Sept. 4, 2013, meeting of the DDA board. He chatted with mayor John Hieftje before the meeting start. Hieftje is a member of the DDA board. (Photos by the writer.)

The renovation is part of the county’s overall space plan, approved by the board of commissioners at its July 10, 2013 meeting. The space plan calls for modifications to the Annex so that it can house the county’s Community Support & Treatment Services (CSTS) department. The cost of the renovations at the Annex, which would include a new lobby and “client interaction” space, would be about $1 million, according to the DDA board resolution. [.pdf of DDA resolution on the Annex] The Annex has housed the county’s office of community and economic development, office of infrastructure management, and the public defender’s office. Those offices are being moved to other leased and county-owned space.

Not described at the DDA’s board meeting was the backdrop of the grant award to the county, which evolved from a conversation between county administration and the DDA about ways the DDA could help the county address its budget deficit. A pitch from the county had been to re-open the agreement under which the county purchases monthly parking permits in the city’s public parking system, which the DDA manages. The alternative proposed by the DDA was to make a one-time $300,000 grant  – to help fund a project for which the county had already identified funding.

Also not mentioned among the several updates given during the Sept. 4 DDA board meeting was an Aug. 26 meeting of a joint DDA-council committee. That committee had been established by the Ann Arbor city council at its July 1, 2013 meeting to work out a recommendation on possible legislation to address an ongoing controversy about DDA tax increment finance revenue. Not much forward progress was made at that committee meeting.

The city council has already given initial approval of changes to the ordinance language that would clarify the amount of tax increment finance capture (TIF) revenue received by the DDA . The clarification currently under consideration does not work out in the DDA’s favor. A final vote of approval appeared on the council’s Sept. 3, 2013 agenda – the day before the DDA board met – but the council decided again to postpone a final vote.

At their Sept. 4 meeting, DDA board members also got a look at a draft five-year plan of projects that has now been generated, partly in response to pressure from the city council – dating back to April of this year – asking the DDA to explain what projects would not be undertaken if the DDA didn’t continue to receive TIF revenue based on its preferred interpretation of the city’s ordinance.

Highlights of other updates that were given at the Sept. 4 DDA board meeting included a review of the preliminary end-of-year figures for the public parking system and the rest of the DDA’s funds. Overall, the DDA’s financial picture was better than budgeted. That difference is due to the timing of various capital costs.

For the parking system, the year-end picture was consistent with the trend throughout the year. Revenue generated by the parking system was up by 11.9% ($19.09 million) compared to the previous fiscal year, while the number of hourly patrons was down by 1.96% (2,232,736).

Low attendance at the board’s meeting was partly a function of the fact that two of the seats are currently vacant. One of the seats could potentially have been filled by the city council through confirmation of Al McWilliams’ nomination at its Sept. 3, 2013 meeting. However, as the nine councilmembers present debated his confirmation, mayor John Hieftje withdrew it, at least for the time being.

McWilliams’ confirmation would have needed six votes on the 11-member council – and the outcome was dubious based on conversation among the nine attendees at the council table. Some councilmembers questioned whether McWilliams’ might have a recurring conflict of interest based on the work his advertising firm, Quack!Media, does for the Ann Arbor Area Transportation Authority and the allocations that the DDA makes to the AAATA’s go!pass program. That allocation amounted to $479,000 this year, and was approved at the DDA board’s March 6, 2013 meeting.

The Sept. 4 DDA board meeting was somewhat unusual in that no one from the public chose to address the board during the session at either of the two points on the agenda for public commentary.

Washtenaw County Annex Grant

The board was asked to support renovations to the building at 110 N. Fourth in Ann Arbor (known as the Annex) so that it can house the county’s Community Support & Treatment Services (CSTS) department. [.pdf of DDA resolution on the Annex] The cost of the renovations at the Annex, which would include a new lobby and “client interaction” space, would be about $1 million, according to the DDA board resolution.

Washtenaw County Annex Grant: Background

CSTS provides a variety of client services to individuals with mental illness, developmental disabilities and substance abuse disorders. The Annex has housed the county’s office of community and economic development, office of infrastructure management, and the public defender’s office. In the space plan approved by the Washtenaw County board of commissioners at its July 10, 2013 meeting, those offices are being moved to other leased and county-owned space.

The County Annex building at 110 N. Fourth was built in 1904 and recently has housed several county units, including the public defender’s office and the office of community and economic development. (Chronicle file photo.)

When the county board approved the renovations associated with the county’s space plan, they were briefed that the total cost of all the renovations – not limited to those at the Annex – would be around $5 million. At the time Greg Dill, the county’s infrastructure management director, said no county general fund dollars would be used for the projects. Funding would come from several sources, Dill explained: (1) $1 million from the 1/8th mill fund balance; (2) $650,000 from the facilities operations & maintenance fund balance; (3) $650,000 from the office of community & economic development reserves; (4) $500,000 from the tech plan fund balance; and (5) $2.2 million from the county’s capital reserves.

According to the county’s website about the space plan, the Washtenaw Community Health Organization (WCHO) – which has a contract with CSTS to provide treatment services – was planning to fund the entire build-out of the Annex as well as the relocation of CSTS staff to the Annex.

The DDA became involved when county administrator Verna McDaniel and other senior staff met with DDA executive director Susan Pollay within the past few weeks to talk about how the DDA might help address the county’s projected structural budget deficit of $3.9 million in 2014. The county pays the DDA nearly $400,000 annually for parking permits, and had proposed the possibility of opening up a long-term parking agreement to renegotiate that amount. McDaniel told The Chronicle that the DDA proposed offering the grant for the Annex renovations instead.

Bob Guenzel, former Washtenaw County administrator, is a member of the DDA board. Guenzel was absent from the Sept. 4 meeting.

Washtenaw County Annex Grant: DDA Board Discussion

The grant to Washtenaw County for improvements to the Annex building was introduced by John Splitt.

Splitt asked executive director of the DDA Susan Pollay to explain the resolution. Pollay said that one of the roles of the DDA is to support all of the various uses of downtown – business and residential – and also government services. She called Washtenaw County an ally of the DDA, and described how the county is very committed to the downtown. Many of the county’s operations have been brought to the downtown, she said. She described how many of the county’s outreach services are planned to be provided in the Annex building.

The challenge that the county has been struggling with, Pollay continued, is that the building is currently not configured in a way that’s suitable for the CSTS clients. So the county has developed a plan to retrofit the building, which includes a lobby and other space. Pollay reported that she’d been talking with Washtenaw County administration members to try to find a way to be supportive. The plans of the county are now at the point where they can begin moving forward, Pollay said. The project as a whole has about a $1 million budget, she said. She described the $300,000 as consistent with the DDA’s 10-year plan and also in keeping with the DDA’s mission.

Joan Lowenstein asked Pollay if it was fair to say that without the DDA’s contribution, the county probably wouldn’t go forward with the renovations. Pollay declined Lowenstein’s gambit by saying, “I don’t know that.” But Pollay did describe the DDA’s contribution as a “significant part” of the project moving forward. It absolutely helps makes it possible, Pollay contended.

John Mouat described his downtown office as providing a good vantage point to see the connection between the Annex and the rest of downtown. You can watch the number of people who go by out his window, he said. [Mouat is an architect with offices at 113 S. Fourth Ave.]

Mayor John Hieftje indicated support for the grant, saying that it’s consistent with the goals of the DDA. Washtenaw County has some significant budget issues that it’s working through right now, he said. He also noted that the DDA Act explicitly highlights the ability of a downtown development authority to help finance government buildings in the downtown area. So Hieftje felt that the grant met the criteria of the statute.

Outcome: The seven members of the board who were present at the meeting voted unanimously to approve the $300,000 grant to Washtenaw County for improvements to the Annex building.

Washtenaw County Annex Grant: Connection to Council, Light Poles

In attendance at the DDA’s board meeting were two city councilmembers – Sabra Briere (Ward 1) and Stephen Kunselman (Ward 3). Neither addressed the board formally during the meeting. Briere typically attends the meetings, while Kunselman does not.

Kunselman told The Chronicle he attended the meeting partly out of interest in the question of whether the DDA had the ability to pay the entire cost of the replacement of decorative pedestrian light poles on Main Street, given its allocation to the Washtenaw County Annex project. In early 2012, two of the light poles had fallen – due to a structural failure at the base of the poles caused by rust. After inspection of all the poles, two additional light poles were deemed to be in immediate risk of falling and were also replaced.

At its July 3, 2013 meeting, the DDA board had approved a resolution allocating $300,000 for the replacement of decorative light poles on Main Street. The total estimated cost of the project is $516,000 for 81 light poles. Based on the DDA board’s resolution, it was DDA’s expectation that the city of Ann Arbor would make up the difference of $216,000.

DDA board member Joan Lowenstein.

The DDA’s July 3 resolution indicated that the city of Ann Arbor’s budget approval process this year had determined that the city would allocate $216,000 for the project. What the Ann Arbor city council actually did on May 20, 2013 was to alter the DDA’s budget by recognizing additional TIF revenues of more than $568,000, and shifting $300,000 of that revenue from the DDA’s TIF fund to the DDA’s housing fund. The council’s resolution also recommended that the DDA spend $300,000 of its TIF fund on the Main Street light pole replacement.

In response to an emailed query from The Chronicle, city administrator Steve Powers indicated back in July that the city council would be asked to act on the matter either at its July 15 or Aug. 8 meeting. That timeframe has slipped, and no council action has been taken on the Main Street light poles. Public services area administrator Craig Hupy, responding to the same query, explained back in July that it wasn’t yet clear if the council action would include an additional appropriation, or if it could be handled within the existing budget.

At the DDA’s Sept. 4 board meeting – during discussion of a five-year draft capital plan – DDA board member Joan Lowenstein characterized the light pole situation from her perspective. She was responding in part to the idea of staying flexible with respect to which projects were implemented, and she indicated that flexibility could be compromised if the DDA were “hogtied” in some way. As an example of the hogtying, she cited the street light poles on Main Street, which the DDA was planning to replace. Lowenstein said: “But then the city council decided to screw around with our budget, so that we couldn’t spend our money on replacing those.” For people who are wondering what is going on with the streetlights, Lowenstein said, they are tied up in the bureaucracy of the city.

Five-Year Draft Project Plan

The DDA has developed a draft list of projects partly in response to pressure from the city council – dating back to April of this year – asking the DDA to explain what projects would not be undertaken if the DDA didn’t continue to receive TIF revenue based on its preferred interpretation of the city’s ordinance. The project list was introduced at the Sept. 4, 2013 DDA board meeting.

By way of introducing the draft plan, which had been reviewed at the operations committee meeting the previous week, DDA executive director Susan Pollay said that one of the things discussed this spring after many years of focusing on very large capital projects, was the fact that the DDA would be ending a cycle of major projects. She alluded to the metaphor of the “pig in the python” used to describe the Library Lane underground parking structure, which was completed last year.

This summer, the DDA had acquired the First and Washington garage, which is located in the City Apartments development. What had been done at the previous week’s operations committee meeting, Pollay reported, was to assemble all of the projects so that they were listed all in one place. The goal was not to compare one project versus another. Pollay felt the committee had done a good job of setting forward the idea of why the projects are on the list and how they support the vision that the DDA is striving for.

Pollay read aloud from the vision statement that’s a part of the draft document:

A walkable, vibrant, authentic, attractive, historic, inclusive, growing, diverse, multi-season downtown, full of lots of things to do, teaming with downtown residents and healthy locally-owned unique businesses, the community’s job and commercial center, a place of shared prosperity, and nationally known as a center for innovation and entrepreneurism.

In outline form, reduced from the more detailed description [.pdf of draft five-year plan], here’s what the draft five-year project plan covers:

Near Term Projects (2013-2018)

Streetscapes

• South University: $2.5-$3 million
• William Street: $5 million
• Huron Street: $5 million
• N. Fifth Ave. (brick streets): $5 million
• S. Main Street: $500,000-$800,000

Sidewalk Maintenance

• Routine maintenance annual cost: $50,000-$75,000
• Wayfinding updates: $50,000
• E. Liberty Street tree pit expansion: $75,000
• Traffic signal box wraps: $50,000

Infrastructure

• Fourth & William parking structure elevators: $2.25 million
• E. William sanitary sewer: $250,000
• Bell Tower alley: $250,000
• W. Huron alley repair and improvements: $300,000
• Additional ePark machines: $850,000

Transportation

• Restore the LINK (circulator bus) annually: $100,000-$250,000
• Add electric vehicle charging units to parking structures: $100,000
• Express bus annually: $50,000-$100,000
• Bike House #2: $30,000
• In-street bike racks: $4,000 each
• Crosswalk repairs: $15,000 per intersection
• Pilot Ypsi/Ann Arbor passenger rail project (initial study): $50,000

Business Encouragement

• Fourth & William parking structure. Build out first floor space along 4th Avenue and William Street: $600,000
• Business Improvement Zones: $50,000 each
• Lodging/conference feasibility study: $50,000
• Marketing campaign for downtown annually: $50,000

Housing

• Grants to encourage the creation of housing affordable to individuals: Grant program to be determined.

Downtown Parks

• Liberty Plaza Park: $175,000
• Farmers Market winter enclosure study: $90,000

Community Services

• County Annex lobby improvements: $300,000
• City Hall environmental controls upgrade: $90,000
• S. State St. road resurfacing and sidewalk expansion: $675,000
• S. Division resurfacing: $320,000
• Liberty/First intersection: $362,000

John Mouat call the draft a terrific start, saying that it pulls together a lot of the things the board has talked about.

Sandi Smith wondered if it was realistic to expect that the projects would be completed in five years. Back and forth between Smith and Pollay indicated that even if some projects might not be completed within a five-year time frame, it was still important to plan for them now. They indicated that if a pressing need comes up, the DDA needs to be flexible and nimble enough to re-priortize.

Russ Collins felt that the five-year plan was not a policy statement, but rather was a way to anticipate what might be a good way to invest the DDA’s money – noting that the DDA doesn’t have any planning authority. The DDA needs approvals from the city council to undertake projects. Collin said the DDA is trying to anticipate needed work as best it can – in coordination with city departments, city council, and private developers. Sometimes the DDA produces documents and they are misunderstood as a statement of policy, Collins said.

Outcome: This was not a voting item.

Parking System

The DDA manages the city’s public parking system under a contract with the city of Ann Arbor. A joint DDA city council work session is scheduled for Sept. 9, 2013 under the terms of the contract, which state in part:

Joint Working Session. As part of the annual established calendar for City Council Working Sessions, City Council shall designate one working session in the fall of each calendar year as a joint working session with the DDA. The agenda for the working session shall be prepared by the City Administrator in accordance with Council Rules and in consultation with the Executive Director of the DDA, provided that such agenda shall include
(i) the DDA’s evaluation of any meter parking rate increases effected during the foregoing year, including, without limitation, the public input associated therewith; and
(ii) a discussion regarding any then-contemplated future meter parking rate increases, which discussion shall satisfy the DDA’s City Council consultation obligation under Section 2(k). It is recommended that a portion of such agenda be dedicated to a discussion of operations under this Agreement and the utility of creating a joint study committee to address areas of mutual interest.

Parking: Year-End Report

John Splitt gave the parking report in Roger Hewitt’s absence. For the last quarter of the fiscal year, he noted revenues were up, as were expenses. He attributed increased expenses for the quarter to grants, capital costs and costs related to bond payments and the installation of new automated equipment.

For June 2013 – the last month of the fiscal year – Splitt noted that revenues were up 7.41% and hourly patrons were down by 7.7% compared to the same month last year. He described the pattern as staying on track in terms of revenues. He ventured that the reduction in hourly patrons could mean that fewer people are staying longer. “That’s a statistic that you can take for what it is,” he concluded. For the last quarter of the fiscal year, revenue was up 11.67% and hourly patrons were slightly down, by about 0.42%, Splitt said.

John Mouat noted that obviously there had been a big drop in revenue at the Washington and Fourth Street parking structure. He ventured that was probably due to the street closure on Fourth Avenue during the major street reconstruction work over the summer. Mouat suggested that it would be great in the future, if the DDA knows about street closings that would be implemented during the year, if impact on revenues could be built into projections for the year.

Splitt summarized the art fair parking numbers as not quite matching the numbers from the previous year, but he felt that the parking system had done quite well during the period of the art fair, considering the weather this year. [.pdf of parking system revenue including 2013 art fairs]

Parking: Four-Year Summary in Charts and Graphs

Total Revenue by Facility. (Graph by The Chronicle with data from the Ann Arbor DDA)

Revenue Per Space, Focus on Structures. (Graph by The Chronicle with data from the Ann Arbor DDA)

Revenue Per Space, Focus on Surface Lots. (Graph by The Chronicle with data from the Ann Arbor DDA)

Total Hourly Patrons. (Graph by The Chronicle with data from the Ann Arbor DDA)

Total Revenue. (Graph by The Chronicle with data from the Ann Arbor DDA)

Parking: Pilot Permit Program

DDA executive director Susan Pollay described how last spring there had been a robust dialogue about how to provide monthly permits in a fair way, when demand is larger than supply. So this summer, the DDA had started a pilot program in the South University area. The concept behind the pilot program was that instead of selling parking permits to individuals, the DDA would engage property owners and assign a number of parking permits to them based on the square footage of their buildings. Letters have been sent out to property owners, Pollay said, and she thought the DDA would be flooded with requests. [For general background on the monthly parking permit system, see: "Column: Rules, Parking, Transportation"]

However, Pollay reported that almost none of the property owners were interested in managing the parking permits on behalf of their tenants. From the point of view of property owners, Pollay ventured that it is easier to have the DDA to manage the demand and to maintain the waiting list.

During the Sept. 4 board meeting, it was also reported that the newly-built Library Lane underground parking garage now has a waiting list for monthly permits. Pollay recalled that when the structure was being planning, there were those who were concerned that the city would have too much parking. Now 50 people are on the wait list for Library Lane permits, Pollay said, because of the DDA’s commitment to keeping spaces open for Ann Arbor District Library patrons. [The structure is adjacent to the downtown library, but owned by the city.]

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: New Board Member – Rishi Narayan

At the start of the meeting, DDA board chair Sandi Smith invited the board’s newest member, Rishi Narayan, to give a 30-second synopsis of who he is. [Narayan's appointment to the DDA board was confirmed by the city council at its Aug. 19, 2013 meeting.] Narayan quipped that he could be summed up in less than 30 seconds. He told the board that he had come to Ann Arbor from the Okemos and Lansing area to attend college, and had remained in Ann Arbor during that time, with a brief stint in Berkeley, California after he got married.

He had moved back and forth between Berkeley and Ann Arbor while his wife was finishing her Ph.D. at the University of California at Berkeley. He described himself as involved in various things in Ann Arbor but his main business is Underground Printing. He had founded that business with a business partner who was his best friend growing up, who also lives in Ann Arbor now. They are no longer Lansing-ites. “That’s me in a nutshell, and I’m looking forward to joining the board,” Narayan concluded.

Comm/Comm: Year-End Financials

In Roger Hewitt’s absence, John Splitt gave the update from the operations committee, which included the year-end unaudited financial figures. Splitt indicated that Joe Morehouse, the DDA’s deputy director, could answer any specific questions from board members. He described the TIF budget as slightly over budget with respect to the excess of revenues over expenditures. But the parking budget was significantly over, Splitt reported.

He confirmed with Morehouse that the better-than-budgeted financial picture relates to the timing on items that the DDA needed to pay. [This includes a delay in acquiring the parking deck portion of the City Apartments project at First and Washington, as well as delay until after July 1 of some parking structure maintenance work.] Splitt summed up the budget variances as a matter of timing.

Based on The Chronicle’s arithmetic, the entire DDA budget looks to be better than budgeted by about $4.8 million. [.pdf of unaudited year-end FY 2013 figures] Overall, based on its most recently revised budget, the DDA had projected expenses would exceed revenues by $5.1 million in a $24.6 million revenue budget. Instead, the unaudited figures for the end of FY 2013 (which ended June 30, 2013) show the deficit amount will be closer $0.38 million.

Comm/Comm: 618 S. Main Project

Joan Lowenstein, reporting out from the board’s partnerships committee, gave an update on the 618 S. Main project. The project team attended the last partnerships committee meeting, she reported, and they had proposed some streetscape improvements for the project site, extending up to Ashley Mews. Those improvements included paving, widening, and planting enhancements. The committee had given some input on the proposed design and asked questions about the project timing, she said.

The streetscape plan is going through review with city staff members, Lowenstein continued, and is part of the DDA’s brownfield grant to the 618 S. Main project. The DDA board would be up considering approval of changes at a future meeting. She characterized the brownfield grant as input and money from the DDA that has allowed the project to be built.

Comm/Comm: Streetscape Framework Plan

At its July 3, 2013 meeting, the board had approved $200,000 of funding for developing a streetscape framework plan. John Mouat reported that in the following week, an RFQ (request for qualifications) would be issued for the streetscape framework plan. When responses come in, an evaluation process would take place, he said, to narrow down the list of consultants, who would then be invited to make proposals.

Comm/Comm: State of the Downtown

In her report out from the DDA’s partnerships committee, Joan Lowenstein said that the committee had reviewed the newest version of the State of the Downtown report. It had been released in August. Lowenstein described how the report really highlights the DDA’s role as “the place to go for information about the downtown.” Among the statistics she highlighted from the report were: 73% of all city special events take place downtown; 26% of jobs in the city are downtown; and 107 sidewalk cafes are located downtown. In the past year, 26 new businesses have been started in the downtown area. Supporting that activity, she continued, population downtown has grown by 56% since 2000.

Board chair Sandi Smith acknowledged DDA planning specialist Amber Miller for her work on the State of the Downtown report. Lowenstein called the report a great reference document with a lot of facts and figures.

Comm/Comm: Economic Collaborative Task Force

Reporting out from the DDA’s partnerships committee, Joan Lowenstein said the committee had received an update on the Ann Arbor economic collaborative task force. [The task force was established through a council resolution passed on May 20, 2013.] Lowenstein described the group as composed of the city of Ann Arbor, Ann Arbor SPARK and the DDA. The task force had met once before the July partnerships committee meeting took place, Lowenstein said. Primarily the task force had focused on the Ann Arbor SPARK five-year strategic plan, including various overlaps with the city of Ann Arbor and the DDA. That included helping to sell and develop the city property in the downtown.

Comm/Comm: Sidewalk Repair

John Splitt gave an update on sidewalk repair work in the downtown. This summer the DDA had been paying for mostly minor repairs to sidewalks, taking care of trip hazards and the like. All of the Americans with Disabilities Act sidewalk ramp work has now been finished, he reported. The final four ramps – the most difficult of them – had been completed this summer. Trees were being trimmed and planted. Essentially it was those issues that are visible that were being addressed this summer, Splitt concluded. The work is about to conclude for the season and next season it will start again.

Comm/Comm: Downtown Zoning Review

Reporting out from the downtown area citizens advisory council (CAC), Ray Detter reminded the board that at its previous meeting, he’d told them that the city planning commission’s executive committee was in the process of hiring a consultant to organize a public process to re-examine the downtown zoning changes, which were adopted in 2009. The downtown design guideline task force had also been reconstituted by the city council to make recommendations on the design guideline review process.

Detter indicated that the CAC was disappointed that the design guideline review task force had not yet met. However during July and August a consulting firm, ENP & Associates, led by Erin Perdu, had conducted a series of events, community coffees, workshops, and online surveys of residents, businesses, and employees of downtown businesses. The discussion at those events focused on what’s working and isn’t working with respect to the current downtown zoning. Detter indicated that the consultant had released a summary of some of those findings.

At the previous night’s meeting of the CAC, those preliminary findings had been reviewed, Detter reported. Not surprisingly, he said, a set of private interviews with developers and downtown real estate professionals – as well as two unnamed members of the DDA board – thought that the current zoning regulations were meeting their intent of developing more density downtown. That group had felt that there were still too many limitations on downtown development. At larger public focus group meetings and workshops, Detter continued, people had largely agreed that the north side of Huron Street between Division Street and South State, the south side of William between Main and Fourth, and the Ann Street site adjacent to city hall should be rezoned. Possible zoning for those sites, he said, would include D2 or possibly a newly-defined D3 zoning. Most people felt that near downtown neighborhoods needed to be protected through proper zoning, Detter reported.

There was also general agreement, Detter said, that the current application of residential premiums [greater floor area ratios allowed for residential uses] was not generating the right kind of diverse housing mix. Premiums were encouraging too much student housing and not enough affordable housing, he said. Most people also supported the idea that the design guidelines should be followed in order to qualify for eligibility for any of the premiums that could be granted. Across the board, most people in all phases of the public process, including online surveys, agreed that more diverse housing should be encouraged in the downtown area, Detter said.

Members of the citizens advisory council were very encouraged by the planning commission’s inclusion of mandatory adherence to city design guidelines as a condition for any request for proposals (RFPs) for the future sale and development of the former YMCA site at Fifth and William. Detter noted that ENP & Associates has now scheduled a series of coffee hours, bag lunches, and public focus groups over the next two weeks as part of the continued work on the downtown zoning review.

Present: Russ Collins, John Hieftje, Joan Lowenstein, John Mouat, Rishi Narayan, Sandi Smith, John Splitt.

Absent: Bob Guenzel, Roger Hewitt, Keith Orr.

Next board meeting: Noon on Wednesday, Oct. 2, 2013, at the DDA offices, 150 S. Fifth Ave., Suite 301. [Check Chronicle event listings to confirm date.]

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The two groups are known as the “mutually beneficial” committees, reflecting the language of a January 2009 city council resolution that called upon the DDA to begin a conversation about revising the parking contract in a “mutually beneficial” way.

On Monday morning, for the first time in public view, members of the DDA board and the city council met to discuss the contract.

The two mutually beneficial committees (starting at the far right of the frame, proceeding clockwise around the table): Carsten Hohnke, Margie Teall – both city councilmembers; Sandi Smith, city councilmember, but representing the DDA; Christopher Taylor, city councilmember; Roger Hewitt and Russ Collins, both on the DDA board. (Photo by the writer.)

The basis of these further discussions was a term sheet that had been produced in late April by some members of the city council and the DDA working outside of either body’s committee structure.

That term sheet had been the good faith basis on which the DDA board, on a 7-4 vote in May, voted to amend the parking contract. That unilateral amendment amounted to a payment from the DDA to the city of an additional $2 million that had not been required under the existing contract.

The specific outcomes of Monday’s meeting between the two committees were: (i) staff for the DDA and the city would be asked to develop a list of policy points that would need to be addressed in order for the DDA to assume responsibility of enforcing parking rules, but not other codes; and (ii) the DDA would be asked to develop a detailed plan by Sept. 13, 2010 describing the role of the DDA in the development of city-owned surface parking lots within the DDA district.

The planned schedule for meetings between the two committees will be the second Monday morning of each month at 8:30 a.m. at the DDA offices on Fifth Avenue. Members of the council’s committee are Margie Teall (Ward 4), Christopher Taylor (Ward 3) and Carsten Hohnke (Ward 5). Representing the DDA are Sandi Smith, Russ Collins, Roger Hewitt and Gary Boren.

Who Was There

All members of the committees attended except for Gary Boren on the DDA’s committee. Besides The Chronicle, in the audience was Maura Thomson of the Main Street Area Association.

There was no discussion of the objections raised at the city council’s May 17, 2010 meeting to Sandi Smith’s participation on the DDA’s committee. Smith serves on both the DDA board and the city council. Those objections had been raised by Marcia Higgins (Ward 4) and Stephen Rapundalo (Ward 2). Their objections were countered at that council meeting by mayor John Hieftje and Margie Teall (Ward 4):

Higgins then expressed concern about Smith sitting on another body’s committee that was having discussions with the city council.

Smith was quick to respond to Higgins’ remarks by indicating that if there was a strong feeling on the part of the city council, then she would resign her committee membership on the DDA’s mutually beneficial committee. However, she told Higgins that she’d thought about the issue a lot. Smith said she felt she had an opportunity to provide insight into both organizations. She also said that up to that point, she had helped the two organizations get past some historical hard feelings – she characterized it as a “clash of cultures.”

Smith said the DDA may or may not be interested in doing any of the items listed on the term sheet. Smith then floated the idea that both the city council and the DDA board would meet together as entire bodies.

Higgins picked up on Smith’s offer to resign from the committee by indicating she wanted to request that Smith not be a member of the DDA’s mutually beneficial committee. Rapundalo echoed Higgins’ request, saying he meant no disrespect to Smith. However, he said that if she were removed from that committee, he would be more comfortable.

Hieftje noted that Smith brought a great deal of knowledge to the work.

And Teall echoed Hieftje’s sentiments that Smith’s skills and knowledge would be useful. Hieftje also suggested that the work going forward should not be thought of as a negotiation but rather a conversation.

Teall was appointed to the council’s mutually beneficial committee in summer of 2009 along with Carsten Hohnke and Leigh Greden, who represented Ward 3 at that time. Teall and Hohnke’s appointments to the council’s mutually beneficial committee at the May 17 meeting was thus their second time to be appointed to such a committee.

Not present at the discussion on Monday morning were any staff members from the city or the DDA.

Opening Discussion

The group spent the opening moments of the meeting reciting familiar facts – the term sheet produced by the working group had been acknowledged by both the city council and the DDA board as a basis for further discussions. As chair of the DDA board’s committee, Sandi Smith took the lead in reviewing the results of the recent retreat, which the board had held to discuss the term sheet.

Opening Discussion: Term Sheet

In bullet-point form, the key elements of the term sheet for discussion were these:

• Parking Enforcement: DDA assumes responsibility for enforcement of parking rules.
• Code Enforcement: DDA assumes responsibility for enforcement of other community standards codes (e.g., sign violations).
• Services: DDA assumes responsibility for various services in the downtown.
• Development: DDA assumes responsibility for development of city-owned downtown surface parking lots.

There were some additions to the term sheet at the DDA retreat, Smith reported. But with respect to the items already on the term sheet, she said, there was “not really stomach” to do code enforcement. If the DDA had no ability to establish the code, she said, the sentiment was that the DDA would be set up only to be “the bad guy” – not something the DDA was interested in doing. In addition, she said, she didn’t think there would be a lot of financial savings.

Opening Discussion: No Deals Already Cut

Russ Collins led off his contribution to the discussion by cheerfully saying that he would like to make “a posturing statement for the media and the citizens attending today.” Collins then stressed that the discussion was “an open dialogue” – there were preliminary discussions where the group had been exploring possibilities, but “no deals were cut.”

The idea that no deals had already been cut, Collins continued, was made clear from the fact that when the entire DDA board and the city council had looked at the term sheet, there had been some reaction among other members along the lines of “I don’t know if we want to do that.”

Collins noted that they were just volunteers who were public servants who were trying to do the best job possible for the citizens. [Editor's note: While DDA board members like Collins are appointed and are not compensated financially for their work, city council members are elected and paid an annual salary of $15,913.]

Teall added to Collins’ “posturing statement” that she felt the term sheet was a “great framework” for the discussion.

Opening Discussion: Basic Premise Is that DDA Manages Parking

Hewitt noted that there were not a lot of additional items that came up during the retreat, and there was one item about which there was not a lot of interest in pursuing – code enforcement. He emphasized that something not explicitly discussed – perhaps because everyone just assumed it – was that the DDA would continue to be in charge of management and operations of the parking system throughout the city.

Consolidation of Parking Management, Enforcement

The two committees dove fairly straightaway into discussing the idea that parking enforcement could be added to the existing DDA responsibility of managing and operating the parking system.

Parking Consolidation: DDA Handles Parking

It should be a single entity that handles the management and the enforcement of parking, Hewitt said – that was the basic assumption underlying the idea that the DDA would assume responsibility for both. Teall asked if it meant that parking enforcement would be done throughout the city, not just downtown.

That brought the conversation to a brief halt. Collins responded by saying, “I don’t know that there’s an answer to that.” He said that his understanding was that parking enforcement outside of parking districts would essentially be accomplished by the community standards officers – there are not meter attendants who cover the whole city.

Smith noted that the DDA currently operates parking meters outside of its tax increment finance (TIF) district, so the idea was not that the district would be an absolute boundary. Hewitt gave an example of something that the DDA did not want to pursue: There are “no parking” signs out near West Stadium Boulevard on a side street in the vicinity of the Dairy Queen that’s outside the DDA district – the DDA doesn’t want to go out and write tickets there.

Christopher Taylor’s characterization was accepted by the others around the table: “DDA-managed parking will be enforced by the DDA.” Smith offered the example of residential parking permits as a “gray zone” – community standards were not likely to take that on, she said.

Hewitt reasoned that the DDA was not doing code enforcement inside the DDA district – there was no board support for that. But there would be code enforcement by community standards staff outside the DDA area, so it would be possible for community standards officers to do parking enforcement outside the district too.

Collins noted that the spirit of previous discussions was essentially that neighborhood parking discussions were a complex matter, and it was important to have an opportunity for political input from the citizens. Hewitt labeled the issue as a “question that needs to be answered” and suggested that there was no particular leaning in one direction or the other at this point.

Parking Consolidation: Consolidate, But Separate From the DDA?

Collins then tentatively raised the issue of a general strategic direction – he indicated he was almost hesitant to say it, because it probably wouldn’t come true. The notion of consolidating “the parking world” and then possibly moving that to a separate kind of authority “isn’t a crazy notion” from the DDA’s standpoint, he ventured. He allowed that this was probably a minority opinion on the DDA board at this point.

Smith offered the counterpoint that parking in itself was not the end – it’s a tool in the development toolbox. “Nobody comes downtown to park,” Smith noted, “they come downtown for other reasons.” Parking is something that can be leveraged and made part of a development strategy – she pointed to the fourth item on the term sheet.

Collins said that for the foreseeable future, unifying management and enforcement within the DDA made sense. He reiterated, though, that as a strategic direction – in terms of aligning Ann Arbor with the way that other cities do things – it was worth bearing in mind that it could be separate. Other cities, he said, had parking authorities that handle these kind of things – it would be a good thought experiment. Other cities had already solved these problems of what’s in and what’s out and who enforces what, he noted.

Parking Consolidation: City Council Approvals, Vetoes

Hewitt noted that there were a number of places where the Ann Arbor city council would want to have control in terms of ratification and veto power, as they have now with the parking rates. So he identified as a challenge to specify where the council had input on parking policy. He said he did not expect the city council to say, “Take the parking system and never come and darken our door again.”

On the other hand, Hewitt said, if the parking system were to be a very complex and dynamic system of the kind that transportation demand management calls for, he did not want to have every decision micromanaged by the city council, and he figured that the city council would also not want that. Where the line was drawn – residential permits, fines, rates – those were details that would have to be worked out and clarified.

Smith suggested that on an annual basis the DDA could do an update to the parking plan that it had submitted to the city council in April and make an annual presentation to the city council. It would not make sense, she said, to say to the city council, “On these five blocks we want to raise the rate, and on these five blocks we want to lower the rate.”

That’s why, Hewitt said, he would still like to have a joint working session with the city council to review the parking plan and the complexity of it.

In response to Hewitt, Taylor said he wanted to “push as much of this to staff as possible.” He suggested that the city staff create a chart of policy decision points by July 12 – the next joint meeting of the two committees. Teall noted that there would be city councilmembers who would want to have input on the policy issues, to which Taylor responded, “That is so deeply true.”

Taylor felt that the discussion would be best served, however, by having a pre-existing list to check through. The list/chart would include, for example, all the points of entry into the public parking system, meter location inside and outside the DDA, loading zones, residential parking, fees, fines – what are the city council’s veto, ratification and initiation roles for each of those?

At the mention of rates, Hewitt noted that under a transportation demand management strategy, the rates would be highly variable depending on the time of day and the location. The rates would also vary depending on demand. It would be difficult to express that as something the council could approve or disapprove. To that Taylor suggested that you would use a range of rates – you can charge “up to X.” Teall stressed that she just wanted the rate to be clear.

Hohnke brought the conversation back to the day’s agenda, after the group had drilled down fairly deep into the issue of parking.

Collins said that they needed a significant representative from the city’s and the DDA’s administration at the meetings. Teall asked if there were legal question about what the city council could and could not have veto power over. Collins said he didn’t know that they needed an attorney to sit at the meetings. The legal matters had to get vetted out eventually, and having attorneys present would simply make the meetings longer, he feared. Teall countered that it would be important to get legal advice quickly when a question came up.

Parking Consolidation: But Wait – Separation of Parking From Code Enforcement?

The committee discussion took an arc that included the third term sheet item – services in the DDA area – before Hohnke again brought the conversation back to a substantive issue related to separating parking enforcement from code enforcement.

Based on Hohnke’s query, the conversation circled back around to whether the DDA was interested in code enforcement. Hewitt reiterated that the DDA was concerned that it would wind up being responsible for enforcing codes that it had no input on – it should be eliminated from future discussion.

Taylor observed that the same problem could occur with respect to parking, in view of the city council’s veto power, but said that it was a smaller point. Collins called it a matter of scale. The only reason code enforcement had originally been included as a possible DDA responsibility was that community standards officers essentially enforce the parking, so there was a thought that an efficiency could be gained by consolidating that function.

But Collins said it was complicated by matters of law and politics. It was logical to do from a work-flow dynamic, but not for the public. Teall asked if community standards officers performed code enforcement work inside and outside the DDA district, would they be only looking for code violations and ignore parking violations? Hewitt pointed out that code enforcement throughout the city would be complaint-driven. They only enforce if someone complains. At that point Smith suggested that level of detail would require staff input.

Collins said it didn’t make a lot of sense to take an officer with the responsibility of doing a variety of enforcement and then to exclude certain geographic areas. Taylor suggested that the language of the term sheet adequately addressed the issue by stipulating “primary, but non-exclusive, responsibility.” Collins said that if a community standards officer was downtown in response to a sign problem and noticed a car parked in a no-parking zone, then of course they would write a ticket for that.

Collins allowed that some DDA members would disagree with that kind of scenario. But he said that he thought if someone is told “don’t worry about that area, someone else is doing the work” then it would not get done. Smith noted that she thought there was a difference between parking in a no-parking zone – that’s an illegal act – versus an expired meter, which is a just a ticketable offense, she said. There was a difference between someone who has chosen to park in an illegal spot versus someone whose meter expired, she contended.

Hewitt also raised the question of where the revenue from various citations would go.

Hohnke indicated a desire to have staff input on the question of whether there was any economy of scale and the potential for mutual benefit by having one group of people responsible for parking enforcement and code enforcement. It would be nice, he said, to have staff verify that separating the two kinds of enforcement is not a financial stumbling block.

Taylor noted that it was clear that the DDA board was not interested in taking on code enforcement. He said that at least some councilmembers had also expressed concern about it. Asking staff if separating the two would cause difficulty would be a good idea, said Taylor. The question to staff should be along the lines of: Right now it looks like we’re going to separate these two – tell us if we should change our minds.

Provision of Services in DDA Area

The third item on the term sheet was the possibility that the DDA would provide various maintenance type services in the downtown area.

Services: Enhancement, Calculation of Cost Savings

Hewitt moved the conversation to the topic of the DDA providing some types of services in the DDA district currently done “occasionally” by the city – in the area of trees and parks.

Smith gave a somewhat more complex representation of the DDA view on services. First, she said, there was a question of whether it was an enhancement of what was supposed to be done. The second issue, she said, related to possible cost savings. If the DDA hired a company to do all the tree trimming, that would have a cost to the DDA, but the cost saved by the city would be different. The city’s crew already existed, she said. So the DDA would not be able to write off the full cost of the tree trimming in any arrangement under the general context of the parking contract.

Collins said there was a two-edged sword with respect to downtown areas and taxation. Yes, he said, we want to have a nice downtown so that people will want to go there. But there was also a view among some DDA board members that downtown was being bled financially for the benefit of the wider city. That was not true, Collins said, but some people had the idea that if the DDA takes responsibility for doing some things downtown, it freed up other money so that leaf collection could happen in Ann Arbor Hills. Collins said he knew that it was not true, but observed that this was the “folk logic” to it.

Smith raised the issue of scale – she’d just visited Austin, Texas, and talked to the director of the downtown development authority there. Based on that conversation, Smith said that 90% of the taxes generated in the Austin district are used throughout the rest of the city, due to the high density. In that case, the amount of taxes generated in a small area suggested that it needed to be disbursed. It was a real question, she said, of how much money generated in the DDA district needed to stay inside the district.

Hohnke asked Hewitt what the level of support on the DDA board was in exploring service levels. Hewitt indicated that there was, in fact, interest in pursuing that as part of the parking contract. There was some discussion about how current the data was that had been included in the chart accompanying the term sheet.

Services: Private Support for Parks

The idea that private companies might adopt certain areas, like parks, in the downtown was not discussed at the committee meeting on Monday.

However, following up on some information from an audience member at the meeting, The Chronicle spoke by phone with John Teeter of First Martin Corp. about First Martin’s current supplement of maintenance in two Ann Arbor parks – Wheeler Park just north of the DDA district, and Liberty Plaza at the corner of Division & Liberty, located squarely in the DDA district.

According to Teeter, First Martin paid for the tree trimming at Wheeler Park this year and is handling the mowing, trimming and edging through this year’s mowing season. They’ve also repaired the steel fence around the playground area. In Liberty Plaza there’s no area to be mowed, but First Martin will be taking care of the tree trimming as soon as the holiday lights are taken down. In addition, the trash collection in the plaza has been added to a First Martin employee’s task list.

The two parks are not accidental choices of First Martin as locations where the real estate company thought about helping to supplement city services. Wheeler Park is located directly across from First Martin offices on Depot Street. And Liberty Plaza adjoins a First Martin property – the Michigan Square Building at 330 E. Liberty. The plaza was built at the same time as the building. First Martin takes an interest in neighborhoods where they operate, Teeter said.

DDA Does Development

Collins described support for parking enforcement by the DDA as strong, but complicated by legal issues, so support wasn’t 100% from the DDA board. Provision of services also had strong support, said Collins, but was work-flow complicated, so also not at 100%.

On the other hand, said Collins, support for the idea of the DDA assuming a leadership role in downtown development might have 100% support from the board. You could make a business case for the parking enforcement, because there are dollars in and dollars out. For services, that was more difficult, there were no dollars in per se, Collins said.

Development: Blueprint for DDA’s Role

Teall asked what staff should be asked for in terms of evaluating development. Hohnke said there was currently a work flow associated with development involving planning staff. He suggested it would be important to look at what currently happens and what a more DDA-driven work flow would look like.

Hewitt characterized current development as “reactive” on the part of city staff. The city council might say that it would like to see a particular lot developed, and staff then reacts to that. A DDA approach would be to look at all the lots in the DDA area and come up with a master plan for those – how they should be used and developed, with timelines.

Hewitt allowed that everything would have to be approved by the council, but it would be a more proactive, comprehensive approach than a one-at-a-time reaction. Smith said she didn’t think it belonged in the parking agreement – it should be a resolution from the city council directing the DDA to create a master plan for “divestment” of the city-owned parking lots over the long term. That would mean gathering input from consultants and the community and presenting it to the city council. Taylor objected to the term “divesting,” saying he’d prefer “optimizing.”

Collins indicated that the reason there was strong DDA support for this fourth point on the term sheet was that it was viewed as the core of the DDA’s mission, so everyone could agree with it. Developing for the benefit of the community was the core of what the DDA was about – parking, trees, community standards were part of the equation, but the development of the downtown was the real core of the DDA mission.

Smith said she didn’t think the city had a great track record recently, and concurred with Hewitt’s characterization of the approach as “reactive.” Hewitt said that with a one-project-at-a-time approach it was hard to maintain expertise among city staff. It was a matter of trying to fit it into people’s responsibilities who had other things to do.

Taylor asked if the Aug. 9 meeting of the committees would be a useful target date for a DDA proposal on how it should work – something fairly detailed. There would need to be appropriate points of city council check-in for the process. Smith noted that the DDA board did not typically meet in August and Hewitt said he’d need to check with staff – the DDA had just recently had its staff develop a parking plan on four months notice. So he wanted to at least consult with DDA staff before pledging them to a certain timeline.

Taylor suggested that at least among the committee members they would hope for a fairly detailed proposed by the Sept. 13 meeting for how the DDA would run development.

Development: Ann Arbor as a Suburban Community

At the most recent DDA board meeting, Russ Collins expressed a lament that what a lot of people wanted was acres and acres of parking, and that in general people did not necessarily support the idea of a downtown. He continued with that theme at a couple of points during Monday morning’s committee meeting.

I think that collectively we need to figure out how to deal with this – I’ve said this before so this is not new – but Ann Arbor is bottom line a suburban community where people pull up in their driveways at their house on a lot. So the vast majority of the electorate, of the population, doesn’t relate viscerally to what a downtown is. So consequently, it’s very easy for the NIMBY nature of communities and neighborhoods … to be encouraged to oppose things that are logical and appropriate for a downtown, but are more nuanced, or complicated or even inappropriate in a suburban kind of environment.

Collins said that accounted for the resistance on the part of citizens and the government alike to those things that the downtown needed in order to be vital. There was too much focus on parking as a problem – either as something there was under- or over-capacity for. Parking is something that suburban people worry about, said Collins, it’s not what urban people worry about.

There was a similar over-focus on parks, he continued. In a suburban setting, parks are 100% positive, he said – in an urban setting it’s more complicated and nuanced. When you say, “Parks” and 95% of your voters are suburban people, they go “Yes!” when that could really be a bad idea for a downtown, he said.

Overcoming the complicated dynamic of the electorate and politicians who have to respond to that electorate, said Collins, is going to be critical.

Development: The Politics of Downtown

Hewitt noted that less than 3% of Ann Arbor residents live in the DDA district. If that were 20%, he said, there would be an entirely different political dynamic going on. On that scenario, Hewitt continued, there would be a constituency that viewed the downtown as a downtown that would have political influence. With the current numbers, it was too small a group and it was divided among all the wards.

The shaded areas are Ann Arbor's five wards with the DDA district in red outline. The roughly pie-shaped configuration of the wards is specified in the city charter. (Image links to higher resolution file.)

Teall agreed with Hewitt, noting that each ward only had a slice of the downtown. Hewitt continued with the theme by saying there was no constituency that votes in numbers, with enough influence and a stake in downtown. It’s not that people don’t go downtown, he said, it’s just that “They love it in the wrong way.”

Taylor began his response to Collins and Hewitt by saying, “Without agreeing with a good deal of that …” He acknowledged that residents appeared before the city council and expressed opinions about developments. It struck him, however, that there is a strong consensus about density in the non-South-University area of the DDA district.

Development: How Tall Is Tall?

Collins contended that the only way to have a significant impact on density was to put up 20-30 story buildings – because that’s when you get the real estate efficiency and payback. But the citizenry at large, he said, would go “Whoah! Anything more than five stories makes me nervous!”

Taylor pointed to Zaragon Place 2 as an example of a project that enjoyed support. Hewitt allowed that Zaragon Place 2, at 14 stories, did not seem to be getting a lot of opposition at this point – it had not gotten high on the public’s consciousness, yet. The possible acceptance of Zaragon Place 2, he thought, suggested a slow transition was taking place. [The development, proposed for the southeast corner of William and Thompson, received approval from the city's planning commission on Tuesday.]

Hewitt noted that at First & Washington, a project had failed to get support 10 years ago because it was going to be seven stories instead of six stories. So 14 stories in the core of downtown was starting to become acceptable, Hewitt said. But 20 stories probably isn’t acceptable at this point, he said.

In response to an indication from Hohnke that he wanted to get the discussion back to the specific agenda of the DDA assuming responsibility for development, Taylor characterized the discussion to that point as acknowledging the challenges of putting together a proposal by Sept. 13.

Hewitt suggested that the DDA draft something and put it out there – the DDA was aware as well or better than anyone of the opposition. Smith suggested that the DDA board’s partnerships committee would be a good venue to discuss the issue – there was representation from the city council there, as well as the city planning commission, via the council’s representative to the planning commission, Tony Derezinski.

Collins said that from an emotional point of view, he was “about to give up and just say, screw it, bulldoze the downtown.” Everybody loves it to death, he said, and let’s just turn everything into a “strip mall karma,” so that when you’re outside of downtown you have one-story strip malls, and when you’re inside the downtown you have five-story strip malls. People want acres of parking everywhere, he said. “It takes a helluva lot of backbone to not cave in to that,” he concluded.

Hohnke allowed that it was a fair point, but he did not think it was exactly accurate. He then ticked through a list of approved developments:

• 8 stories at First & Washington [Village Green's City Apartments]
• 8 stories at Washington & Ashley [Tierra on Ashley]
• 10 stories at Kingsley & Ashley [Kingsley Lane]
• 5 stories on North Main [Near North]
• 10 stories of development at the Greek Orthodox church [The Gallery]
• 10 stories at Washington & Division [Metro 202]
• 14 stories at S. Forest [601 S. Forest]
• 14 stories at William & Thompson [Zaragon Place 2]

Hohnke concluded that the notion that there isn’t forward movement with development downtown is factually inaccurate.

Collins came back to the complicated nature of the discussions. Any building above five stories and below 20 stories, he said, is inherently inefficient, because above five stories you have to build a skyscraper in terms of the building code. And if you’re going to build that complicated a building, you need to build to 20 stories to get the payback you need to accommodate that.

Collins compared a 10-story building to a car with only two wheels. That was only halfway to where the city needs to go to get the financial incentives that would create density and development. Teall added that the greater height would also allow residential units to be affordable.

Development: City Council Would Retain Approval Power

Smith came back to idea that the DDA would just be creating a blueprint and it would remain 100% within the city council purview to execute the plan. Teall cautioned that she thought the DDA was to execute the plan as well. But Smith stressed that the city would not simply be turning the deeds to properties over to the DDA. And final approval of anything would rest on council, she said.

Taking Kline’s Lot – on Ashley between William and Liberty – as an example, Smith said the DDA could develop a plan, it would be presented to the city council and the council would either say, “You’re crazy!” or “Go for it!”

Teall said she wanted the city administrator, Roger Fraser, to be part of the development of the plan – she felt he had a good feel for the big development picture right now. People came to Fraser to ask about development, she said. Collins said that one of the things he and Teall had talked through with Fraser a few months ago was the idea of an “ombudsman for development” – someone to be an advocate for the developers within the city. Collins noted that obviously the ombudsman would not be able to circumvent the law or the process.

Smith mentioned that in Chicago they’d created a policy whereby green buildings went to the top of the processing pile.

Additional Ideas: Village Green, Bonding, Fees

At the DDA’s May 28 retreat, board member Newcombe Clark had raised a collection of points with hopes of getting some contractual consideration in connection with the $2 million payment the DDA had already agreed to make to the city.

Village Green

Those points included creating a deadline for Village Green, the developer of the City Apartments project at First & Washington, to exercise its option to purchase the land. The city council will vote at its June 21 meeting on extending that option.

At Monday’s meeting, Smith characterized the Village Green City Apartments issue as more of “an FYI” because it was coming before the city council for a possible extension of the deadline.

Hewitt said that from a budgeting point of view, the DDA was reserving a significant chunk of cash and bonding authority to finance the project and it was important to have some clarity.

Bond issuance, Smith said, was a valid point to raise, related to fees that the DDA pays to the city on major projects. Hewitt described the situation with the underground parking garage as paying for the privilege of paying for bonds for a structure that the DDA was giving to the city. “I think you can probably imagine,” Hewitt told the councilmembers present, “that it does grate somewhat.”

Downtown Policing

Clark has also pushed the idea of contracting for downtown police patrols – or some other means of getting “eyes on the street” as part of the possible parking contract discussions.

At Monday’s meeting, Hewitt said that having contracted for downtown beat patrol officers for State Street back in the mid ’90s, he had some clear ideas of how it should be handled. He said the DDA board was not yet ready to determine what their approach would be.

Smith stressed that it was important to inquire of the city staff what the capacity was for community standards officers to provide “eyes on the street.” Can they ask panhandlers to move on? What’s possible and what are the efficiencies? Chief Barnett Jones or the deputy chief will be addressing the DDA board’s partnerships committee next month on safety issues. Collins noted that he’d been reading “Freakonomics” recently, which includes a range of examples illustrating the difference between perception and reality.

The results of the safety survey had come back not as bad she thought they might, reported Teall – the results had been discussed at the last partnerships committee meeting. Hewitt noted there were only three reported crimes in parking structures in 2009 – it was his favorite statistic. Collins addressed the 84% statistic of those who felt the city was safe – what he didn’t know is if 16% considering it unsafe was too high.

Recap

Smith moved the group to wrapping things up and the next two main steps identified were: (i) to ask the staff of both the DDA and the city to identify the key policy decision points for parking enforcement, and (ii) to share with DDA staff the goals of putting together a proposal for the DDA’s role in developing city-owned surface parking lots.

As part of the concluding discussion, Collins noted that it was important to be mindful that using words like “development” already caused a lot of anxiety. He characterized it as a leadership issue – you lead people to what is beneficial without obfuscating. Teall agreed that it was important not to use trigger words.