the Downtown Development Authority
at least, reduce its scope
Earlier DDA-focused material
which appears below this tinted table provides background and context.
Also see DDA News
And See DO NOT dissolve the DDA
Carthago delenda est -- Cato
Sell Normandy Oaks Golf Course and Dissolve the DDA -- FJV
Dissolve the Downtown Development Authority, a
restructuring step which will not require a reduction-in-force.
Transfer the DDA's assets and liabilities to City Hall control. Begin the
by immediately returning to City-control the area north of Eleven Mile
which was added to the original Downtown District. [See Glossary, at
1. The DDA is established by State law, and the City cannot
unilaterally dissolve the body.
2. If the DDA is dissolved, the City will acquire debt, not just
3. The DDA, by collecting TIFA funds [see Glossary, at right], serves
as a transfer station to relay taxes to other government units, like the
4. The DDA frequently contributes to other City needs and projects,
like the Lafayette Parking Structure, the Farmer's Market, moving the War
Memorials, even donating $4,000 to enable this year's Christmas
5. The DDA has been visibly successful. Downtown has revived. The
Woodward-696 area is largely developed. It helped the City balance its
6. TIFA financing has proved to be an effective and fair way to
encourage selective development.
1. State law permits, it does not mandate, establishing a
DDA. [See Glossary, at right.] There may be some legalistic cumbersomeness
in dissolving the DDA, but that inconvenience will prove transitory.
2. The DDA is able to service its debt with its income; so will the
City. The debt ends in a specified number of years. The income is there in
3. The City already collects taxes for other government units like the
school district. After DDA is dissolved, the City will simply have more
money to distribute.
4. Think of DDA money as just another "enterprise fund." The
money ultimately belongs to the City. For bookkeeping reasons the funds
are allocated to a separate account. (Well, more than one account; DDA's
operating budget is separate from the DDA/TIFA budget.) Dissolving the DDA will make it a bit
easier for laymen (and, frankly, city commissioners) to understand the City's financial reports.
5. The DDA was successful in its early years. In recent years its
performance has been less than stellar:
- VersagiVoice has previously labeled as a "debacle"
the DDA's search for a Downtown Manager, a position which probably has
outlived its usefulness anyway.
- The City Commission is openly impatient with the DDA's slowness in
developing a new Master Plan for itself.
- The DDA has failed to make effective use of the Main Street Program
and of that program's mandated committee structure.
- The DDA's most visible activity of late has been the re-funding of a
marketing study which largely duplicated an earlier study.
- The successful promotional activities created and implemented by
DDA's Marketing Consultant result, not from DDA direction but from the
consultant's creativeness and self-motivation, once given a budget.
The contractor-consultant can report directly to City Hall.
6. Cities around the country are having second thoughts about TIFA.
Some residents have come to resent what they see as preferential diversion of taxes to
the business community. (In Royal Oak, downtown property owners -- and
business owners? -- pay an
additional 2 mills.)
Cities report, too, that the TIFA/DDA approach to development follows
the classical S-curve. Once the curve flattens, a DDA moves into a
"maintenance mode," and further need for the body becomes
problematic. That has happened in Royal Oak.
Dissolve the Downtown Development Authority, save jobs, and hold City
Hall directly responsible for every incoming and outgoing dollar.
Central Business District
Originally, in 1976, the area was that
between West and Troy Streets, north of Lincoln and south of Eleven Mile.
Boundary adjustments in 1977,
1980, 1992, and 1994 extended this "Downtown District" which now
includes 2 blocks between Main and Troy Streets, north of Eleven Mile and
south of Pingree; the area referred to as the Woodward-696 Development Area,
and the Civic Center between Eleven Mile and Fourth Street, Troy Street and
Downtown Development Authority
Essentially this is the State-authorized local governmental body assigned
authority over property in the CBD or Downtown District. Royal Oak's DDA was
established in 1976. Its assignment: The City commission of the City
hereby determines that it is necessary for the best interests of the City to
halt property deterioration and increase property tax valuation where
possible in the business district of the City, to eliminate the causes of
that deterioration and to promote economic growth by establishing a Downtown
Development Authority pursuant to Act 197.
Tax Increment Financing Act
This concept "captures" increases in tax revenues over those
in effect at the time the concept is applied to property under DDA control.
The City continues to collect directly the tax revenue already in place
*Boundaries are confusing: CDB,
DDA, DDA/TIF; then there are partially excluded properties, like some apartment
buildings; and Skylofts condo owners pay the pay a DDA fee.
Normandy Oaks Golf Course
We must always remember that no
human activity-- and certainly no governmental operation - is ever perfect.
There are always trade-offs, compromises, imperfections tolerated for the
greater good. To help my management consulting clients -- family
businesses, multinational businesses, trade and professional associations,
private clubs -- focus on the pluses and minuses of proposed changes to whatever
exists, I use an FFH matrix.
Thinking through the interrelationships among Functional,
helps one focus simultaneously on the overall picture and on the details which
might otherwise be forgotten or overlooked.
The DDA-focused FFH matrix below
was drafted before the 19 Sep 05 meeting of Royal Oak's City Commission. During
that meeting, Commissioner Andrzejak offered "friendly" and
"hostile" approaches to DDA, seeking help with the city's financial problems.
And Commissioner Drinkwine repeated his impatience at the DDA's non-response to
his year-ago request for a Master Plan. Drinkwine characterized the DDA as
spending its time "merely going through processes."
Dissolve the DDA
Whether or not that
saves money, it streamlines government a bit.
The Downtown Development Authority has accomplished its original mission.*
The DDA is in maintenance mode, and its responsibilities can be met directly
by City Hall.**
|Monitoring recent DDA meetings
and announcements shows:
- Very little substantive work is
accomplished at DDA meetings.
- The DDA has been only marginally
successful at implementing the Main Street Program.
- Its search for a replacement for the
resigned Downtown Manager has been a debacle. Any new Downtown Manager
should report directly to city hall (the position's office is already
there); there is no functional need for a Third Party between city
hall and the contract employee.
- The DDA's work is really
accomplished at city hall, so much so that Planning Director Tim
Thwing used that workload as partial justification for requesting an
additional body in his department.
- One relatively successful ongoing program
is the use of a contractor as marketing coordinator. That, too, can be
managed directly from city hall.
All that being so, there is no need for a
separate, quasi-independent governmental entity to perform any remaining
Central Business District duties.
|City Hall continues
to insist that, overall, the city and its citizens are best served by
keeping the current DDA in place.
Yet, after what seems like half a dozen
attempts to explain the convoluted flow of revenues, expenditures, grants,
debts, pass-through transactions -- and talk of TIFA, CBD assessments,
bonds -- most non-government observers (and some of them) remain in a haze
- Dissolve the DDA.
- Make whatever legal moves are needed
relative to redirecting TIFA transactions.
- Reconsider TIFA, itself. Other cities
are questioning the use of such funds for the benefit of only one part
of town -- and of businesses.
- Let the downtown merchants, who have
long complained about both the functional and financial performance of
DDA, decide whether they want to assess themselves to develop or
promote downtown-specific services.
- Make whatever procedural moves are
needed to pay for a Downtown Manager, if one is still needed after
reason, it often happens that in a group of dedicated and competent individuals, the competence of
the whole is less than the sum of the competence of the parts.
That has happened with the DDA.
There are good people up there, several of
them also serving civically in other arenas. And there is always one or
two city officials taking part.
But, because the DDA has accomplished its
original mission,* its monthly agenda too often degenerates
into friendly and quiet and rambling conversations about such matters as:
- the kind of and placement of promotional
- the shape of downtown benches
- facade improvement
- reviewing repetitive marketing studies
which add little new to the knowledge-pot (was a new study needed to
confirm the obvious fact that Barnes & Noble has become the
most popular downtown destination?)
- The non-performance of Main Street
- Website development
These dedicated and competent people have
better things to do with their time.
* From City Ordinance No. 76-26
The City Commission of the City hereby determines
that it is necessary for the best interests of the City to halt property value
deterioration and increase property tax valuation where possible in the business
district of the City, to eliminate the causes of that deterioration and to
promote economic growth by establishing a Downtown Development Authority pursuant
to Act 197.
** Although the DDA meets most months, the
latest minutes posted on the city's website are dated February 23, 2005.[have
since been updated]
Dissolve the DDA - 2
DDA Chairman Barbara Bos ran an effective meeting on 21 September.
Bos managed well the unusual vigor, contention, even a little testiness --
from a group whose meetings usually take the form of quiet and friendly
conversation. Paradoxically, the well-run meeting reinforces the case for dissolving the
Downtown Development Authority.
Routine business moved right along:
approval of minutes and of expenses . . . a Promotions update by Marketing Coordinator
Peggy Goodwin . . . a report from and dialogue with Police Chief
Quisenberry about the 2-cop downtown patrol, being paid for by the DDA . . .
the Parking Study . . . the decision to conduct a renewed search for a Downtown
Manager. There was a bit more contention while discussing who qualifies for
inclusion in a listing agreement concerned with some Woodward/Washington
It was the almost hour-long
discussion concerning who-pays-how much when the DDA's (City's?) Streetscape
Policy is enforced that helped make the case for dissolving the DDA. The convoluted
comments approached wrangling as DDA directors, Planning Director Tim Thwing,
and City Manager Tom Hoover tried to sort out where policy responsibility/authority
lies and, separately, where the multi-party financial obligations fall (DDA,
Developer, City). One director commented that the DDA has been dealing --
rather, not dealing -- with this issue for years.
Proof-enough that having the DDA
exercise third-party control of (some) funds confuses policy and
As suggested in VersagiVoice's 20 Sep 05 recommendation to dissolve the
DDA and take the necessary legislative/legal/political steps to reallocate/discontinue
TIFA funds, competent volunteers serve as directors; it is the organizational/procedural
loss of mission which has diminished the group's effectiveness.
Since all the DDA's work is done by
city staff, anyway, we can keep those dedicated and competent individuals by
replacing the DDA with a more typical advisory committee
-- equivalent, say, to the Traffic Committee. All of the routine business
mentioned above can properly be performed by such a committee, and all the staff
work and financial accountability will be centered in the Administration. -- 25
Planning director defends DDA,
is the Trib's 02
September headline on a Q&A report during which Tim Thwing repeats
for a wider audience the defense he presented at two Town Hall meetings. [See]
More forcefully in the column
than in his oral presentation, Thwing makes the point that "tax revenues
would be lost to other entities besides the city."