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Posted on Wed, Jun 5, 2013 : 5:33 p.m.

Ann Arbor DDA puts more money toward housing and replacing Main Street light poles

By Ryan J. Stanton

The Ann Arbor Downtown Development Authority adopted a revised budget for the upcoming fiscal year on Wednesday in response to directives from the City Council to put more money toward affordable housing and replacing deteriorating streetlight poles on Main Street.

The revised budget also factors in newer revenue projections from the city assessor's office, showing the DDA collecting more than $4.5 million in taxes for the fiscal year beginning July 1.

In other action, the DDA board agreed to allow the developer of the Varsity high-rise being built on Washington Street to lease five more parking spaces in the city's Liberty Square parking garage. That comes on top of two spaces already approved by the DDA in January.


Brad Moore, associate architect for the Varsity high-rise project on Washington Street, appears before the Downtown Development Authority board on Wednesday on behalf of the developer to request five additional parking spaces for the project to be leased from the Liberty Square parking garage. The DDA board approved the request.

Ryan J. Stanton |

Under the DDA's revised budget for the fiscal year starting July 1, a total of $400,000 in tax revenues are being transferred into the DDA's housing fund — adding to an existing balance of $382,264.

The DDA is planning to issue a $400,000 grant in the coming year to support four affordable housing units in Village Green's new Ann Arbor City Apartments being built at First and Washington.

Those four units are expected to be affordable to residents with incomes at or below 60 percent of the average median income, making $885 the maximum monthly rent payment for a one-person household.

The DDA's budget is broken down into four funds — a tax-increment financing or TIF fund, a housing fund, a parking fund and a parking maintenance fund.

All funds combined, the DDA is projecting revenues of nearly $24 million, including $19.4 million in parking revenues. Budgeted expenses total $23.8 million, leaving a $194,010 surplus.

At the end of the fiscal year in June 2014, the DDA is projected to have cash reserves of $3.5 million, including $2.1 million in the parking maintenance fund, $633,484 in the parking fund, $382,495 in the housing fund, and $370,521 in the TIF fund.

The $400,000 transfer from the TIF fund to the housing fund represents a $300,000 change from the $100,000 previously budgeted by the DDA. The DDA also is increasing TIF capital costs from $300,000 to $568,343 to budget for replacing the light poles on Main Street between Huron and William.

"The council resolution asked that we provide $300,000 for the light poles, but we're just showing you $268,000, which is the differential," DDA Executive Director Susan Pollay told board members on Wednesday. "We're working with city staff on the remaining amount."

Pollay said the total cost of the light poles is estimated at $516,000. She said a resolution will be going to the City Council within the month asking for approval to cover the remaining amount from the general fund, and then the project could come back to the DDA for approval in July.

Sandi Smith and John Mouat were the only two DDA board members to vote against the revised budget on Wednesday. Smith said she had a problem with the City Council telling the DDA to transfer an extra $300,000 to the housing fund without a specific project ready to be funded.

"I just find this very challenging right now to say that we accept what council has proposed here by moving this arbitrary amount of money over to housing without a project," she said.

The DDA regularly doles out housing fund money to support affordable housing initiatives in and around the downtown. Last year, it gave $150,000 to help support Dawn Farm's transitional housing program, and another $560,000 for improvements at Baker Commons, a low-income public housing facility managed by the city's Housing Commission at Packard and Main.

"We've been working pretty hard to contribute to affordable housing, but not having a real clear path of how we do that," Smith said. "And it's been a struggle over the last eight years that I've been sitting at the Partnerships Committee and trying to do this — to find solid projects and a method of investing in affordable housing in downtown Ann Arbor — so this seems to be very arbitrary."

Roger Hewitt, the DDA board's treasurer, reminded Smith state law is pretty clear on the DDA's budget needing approval from the City Council.

"The law is the law," he said.

Board member Keith Orr commented that it seems odd the City Council is trying to micromanage the DDA's spending. He said it was with reservation he voted in favor of the revised budget.

Mayor John Hieftje said he's hopeful the city's general fund will be able to cover balance of the cost of replacing the light poles, but he's not sure how other council members will feel.

He and other DDA board members said it's an urgent need. DDA Chairwoman Leah Gunn called it "an emergency."

Gunn said the issue of funding downtown beat cops — another budget item the City Council has asked the DDA to consider — will be discussed by the DDA's Operations Committee at 11 a.m. June 19. She said the date of the meeting has been changed from June 26.

Varsity parking approved

The Varsity high-rise was required by the city to provide 76 parking spaces for tenants. But now with DDA approval, seven of those spaces will be leased from the Liberty Square parking garage.

Under a city policy approved by the City Council in 2012, new developments in the downtown that must provide some amount of parking as part of their site plan requirements — but are unable to or unwilling to provide those parking spaces on site — can lease offsite public parking spaces.

Under the originally approved site plan, the Varsity was going to provide 70 spaces in the building plus two "car-sharing spaces," which counted for four spaces apiece. That gave it 78 spaces, which was two more than the 76 required by city ordinance.

The developer later decided the car-sharing concept was infeasible and went to the DDA several months ago to replace those two spaces with two leased spaces. But under that arrangement, the developer was still four spaces short of the required 76.

The reason five more spaces had been requested by the developer was because another space in the building was lost due to conflicts between piping and handicap-accessibility requirements.

Ryan J. Stanton covers government and politics for Reach him at or 734-623-2529. You also can follow him on Twitter or subscribe to's email newsletters.



Thu, Jun 6, 2013 : 5:13 p.m.

SE MI is OVERFLOWING with affordable housing! Why are we wasting money putting it in one the highest cost area's of the state? The DDA shadow government is obsessed with pushing it's political agenda, not benefiting the citizens of A2. It needs to go.

Steve Bean

Thu, Jun 6, 2013 : 2:32 p.m.

Having a housing fund is an odd one. A transportation fund would make more sense. They almost have that in the parking fund/go!Pass combination, but spending money on housing (downtown) is less effective relative to its potential use for transportation, which would serve far more people. This seems to be a case of personal or political ideology trumping sound public policy, but I'm open to someone making the case otherwise.

Tom Whitaker

Thu, Jun 6, 2013 : 1:08 p.m.

If the DDA is receiving more revenue than anticipated, then that extra revenue ought to go towards completing projects they've started, but not completed---namely, the Fifth and Division Street improvement project. That project, which was originally to be funded only by DDA TIF dollars, was later rolled into the bond issue for the underground structure. Areas of Fifth Avenue by Kerrytown, and between William and Packard were cut pre-bid as a budget measure, but when bids came in $1 million below budget, those sections were not added back in to the project. Ironic, since this was a traffic-calming project and these two sections of Fifth Ave. include the very pedestrian-heavy Farmer's Market/Community High/Kerrytown/Zingermans area and the 400-500 blocks of South Fifth, the densest residential blocks of Fifth Avenue (of all the blocks originally included in the project). I can only assume the $1 million surplus was absorbed by cost overruns on the underground garage since the two projects' bond funds were apparently co-mingled, but no one is talking.


Thu, Jun 6, 2013 : 1 p.m.

They are making units available to individuals making up to 60 percent below the medium income with a ceiling of $885 rent for one person? You have got to be kidding me. I am barely making the medium and cannot afford that monthly rent. Somebody be real here.


Thu, Jun 6, 2013 : 3:37 p.m.

Well, if it's STILL winding up being difficult for some, we need to INCREASE the amount of tax money put into it. Why only go halfway? Is there an Affordable Car program?

Ryan J. Stanton

Thu, Jun 6, 2013 : 1:22 p.m.

The correct terminology is "median" income. The area median income for a single person in Ann Arbor is $58,200, according to information provided to me last month by the city (or $83,100 for a family of four). It's possible to afford $885 a month at 60% of AMI, but depending on what other costs you have in your life (student loan debt, car payment, etc.) it could be difficult for some.


Thu, Jun 6, 2013 : 11:24 a.m.

So what do I need to do to get affordable housing? Just quit one of my jobs? I'd like to get subsidized living downtown, and I could also use a break.


Thu, Jun 6, 2013 : 11:23 a.m.

Still shoveling QUITE a bit of money to Avalon, I see. So I guess the ramifications for doing nothing with those North main properties except waiting for the city to demolish them for them free of charge is...nothing. They just continue collecting money. Wonderful.


Thu, Jun 6, 2013 : 11:15 a.m.

"Those four units are expected to be affordable to residents with incomes at or below 60 percent of the average median income, making $885 the maximum monthly rent payment for a one-person household." Really? That's considered affordable? Not in my book. It's actually on the higher end for a 1 bedroom that's not considered "luxury living" in this county.

Steve Bean

Thu, Jun 6, 2013 : 2:26 p.m.

What can make downtown housing affordable is the potential to walk to most necessary services thereby making car ownership less necessary. That lifestyle, along with smaller living space isn't for everyone.

Stephen Lange Ranzini

Thu, Jun 6, 2013 : 3:14 a.m.

"Pollay said the total cost of the light poles is estimated at $516,000. Mayor John Hieftje said he's hopeful the city's general fund will be able to cover balance of the cost of replacing the light poles, but he's not sure how other council members will feel. He and other DDA board members said it's an urgent need. DDA Chairwoman Leah Gunn called it "an emergency." Can someone please explain to me why replacing $516,000 of light poles is an emergency? Are they all defective? Rusted through? About to fall down and crush cars? Kill people? What could it be?!

Stephen Lange Ranzini

Thu, Jun 6, 2013 : 3:35 p.m.

Here is another good question @Dave Askins wrote in the comments on that article: "In the meantime, no one at the DDA or the city has publicly asked the question: Aren't light poles supposed to last longer than this? And who oversaw the original installation of steel posts resting flush on concrete? [which has caused the loss of $516,000 of taxpayer funds. Usually in private industry when you screw up that badly you need a new job. But in our city is there no accountability?


Thu, Jun 6, 2013 : 2:19 p.m.

Yes, more $ for higher density placement and not highway like light poles. Downtown as a destination not a strip mall parking lot. While I'm in favor of electing these officials, I think this is an appropriate use of the funds that are captured because downtown is a destination for people who live her and many more that don't.

Stephen Lange Ranzini

Thu, Jun 6, 2013 : 2:09 p.m.

@Ordmad: Thanks for the link and information! So, 90% of the cost is optional and driven only by aesthetic considerations: "At the May 13 gathering of the DDA board, Pollay indicated that she'd been informed that if the city undertook the installation, it would take a more functional approach and install a fewer number of replacement light poles – using "cobra head" fixtures, instead of the decorative lamp posts currently in place. That cost for the functional approach was estimated at $50,000. Responding to a question from Kunselman, Hupy described an interest in not having the same "design error" going forward. At the May 13 gathering of the DDA board, Pollay had described how the light poles that are rusting sit flush on the concrete and may sit in water. A newer design has the base of the poles elevated on "fingers."

Ryan J. Stanton

Thu, Jun 6, 2013 : 1:16 p.m.

Yeah, definitely go take a look at that photo. The worst-case-scenario fear, which the mayor and others have expressed, is that one of these could fall on someone.


Thu, Jun 6, 2013 : 12:29 p.m.

Rusted through at the bottom and from the looks of it pretty badly. Story and picture here:


Wed, Jun 5, 2013 : 10:16 p.m.

Leasing spots in a city-owned parking garage might meet the letter of the city policy requirements, but the idea that a property developer is "unable or unwilling" to provide enough parking spaces should call for a reduction in the scale of the project, not a chance to lease spaces. If a building is too big to contain its parking, it is too big for the space, make it smaller, don't let it slide. More DDA sneaking to keep their square footage TIF dollars and parking income up.


Wed, Jun 5, 2013 : 9:41 p.m.

What's wrong with the existing poles? Are they replacing the light fixtures, too, or just the poles and reinstall the existing light fixtures?

Ryan J. Stanton

Thu, Jun 6, 2013 : 1:37 a.m.

I've only heard mention of the poles so far. I'll be getting more details and reporting more on this soon.