$2 million transfer from DDA to city of Ann Arbor moving forward, agreement being worked out
A one-time payment of $2 million is likely to make its way from the Downtown Development Authority's coffers to the city of Ann Arbor, helping the city balance its 2010-11 budget.
The DDA's Operations Committee met today and announced a framework for discussions that are expected to lead to a new parking agreement between the city and DDA.
It's expected that the $2 million transfer will be voted on by the DDA's full governing board next Wednesday, and based on today's discussion, it appears to have all the support it needs.
Ryan J. Stanton | AnnArbor.com
A working group of seven members of the Ann Arbor City Council and DDA governing board issued a joint memorandum today, stating they believe the $2 million transfer is necessary to advance the congruent missions of the city and DDA.
"It'll help us to move forward with the whole budget and bring amendments forward that I think will help us at least delay layoffs another year," said City Council Member Margie Teall, a member of the group.
Teall and Council Member Sandi Smith, who also serves on the DDA board, agreed the $2 million will go a long way toward solving the city's budget crunch. The city had faced a deficit of between $5.2 million and $5.8 million in its general fund for 2010-11.
"I don't know what the ramifications are as far as safety services, but certainly it will help us retain some, if not all, of those scheduled for layoff," Smith said, hopeful the money can help avoid cuts to police and fire particularly.
Under City Administrator Roger Fraser's proposed budget, 40 positions are slated for elimination in police and fire in July to save $3.6 million. Even with those cuts, Fraser's budget still includes a $1.53 million deficit, so $2 million might not go far beyond patching that hole.
The DDA's governing board voted 7-4 last month to approve a budget for the upcoming fiscal year that included a $2 million contingency. Whether the city received that money hinged on the pending renegotiation of a downtown parking agreement between the city and the DDA.
The expected $2 million commitment from the DDA is a continuation of annual payments the DDA has made to the city for years. About five years ago, the city and the DDA negotiated a contract for the DDA to operate the city's parking system. That contract required the DDA to pay the city $1 million a year over a 10-year period that will end in 2015.
The city has been drawing an extra $1 million on top of the contracted $1 million for each of the last five years, depleting the entire $10 million worth of the contract five years early.
Roger Hewitt, chairman of the DDA's Operations Committee, laid out the framework of a possible agreement today to continue the $2 million payments to the city for at least this year — with a formal agreement yet to be finalized.
Hewitt said discussions will continue, leading up to the finalization of a new agreement hopefully by Oct. 31. He summed it up the tentative framework:
- The DDA would continue to pay the city $2 million a year.
- The DDA would be responsible for all the public parking management and policies within the city, though certain policy decisions still would go through City Council.
- The DDA would take over parking enforcement that is now currently a city function. The DDA also would take over community standards enforcement within the DDA area, which is now a city function.
- The DDA would be responsible for certain city services that are now done by the city within the DDA area.
- The DDA would become the engine for the implementation of development of city-owned surface parking lots within the DDA area.
Hewitt said the services in discussion include items like tree trimming, maintenance of Liberty Plaza and Sculpture Plaza, maintenance of historical markers and graffiti removal.
"We sort of philosophically kind of drew a line at the curb — the street would be the city's responsibility, and the curb and sidewalks and alleys would be the DDA's responsibility," Hewitt said. "There are many details to be worked out, but that's the approximate breakdown."
Arbor Brewing Co. owner Rene Greff, a former DDA board member, criticized DDA officials today for deciding to "write a blank check to the city for $2 million with no strings attached."
"This money will be pilfered from the parking system and even though you will deny the connection, we all know it will be paid for by struggling small businesses owners, our employees and our customers through higher parking rates, increased fines, and evening enforcement," she wrote in an e-mail to DDA officials. "There is so much that stinks about this resolution and the process that led to it that I hardly know where to begin."
Read the full text of her e-mail here.
Ryan J. Stanton covers government for AnnArbor.com. Reach him at email@example.com or 734-6223-2529.