Arbor Update

Ann Arbor Area Community News

Downtown parking - how valuable is free?

19. December 2009 • Murph
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It’s been a while since we had a good parking fight around here, so thanks to AnnArbor.com for throwing us a bone. In two pieces today, they post one downtown merchant’s op-ed for free parking during the holidays, and an article on the Ann Arbor City Council’s upcoming discussion of extending meter enforcement from 6pm to 10pm. (full resolution text.)

City Councilmember Sandi Smith cites, in her explanation of the time extension, the importance of convenient, high-turnover parking at the curb for downtown businesses and customers. For at least five years, the DDA has observed that the 6pm end time encourages all-night parking – a downtown employee or patron arriving at 4 or 5pm pays the meter through 6pm, then leaves the car there for the rest of the night, forcing later patrons to park further away even for short trips.

Commenters on AnnArbor.com, by contrast, are heavily skewed towards the attitude that parking should be free, so that downtown Ann Arbor businesses can compete effectively with WalMart.

Extending meter enforcement can, according to Don Shoup and others, help downtown businesses in this competition by providing parking convenience, often a stronger factor than price in the mall vs. downtown decision. (This, as observed, rarely factors into the visceral reaction to pricing parking.)

Notably, past discussions of downtown parking pricing and timing have typically led to the concern that lower income downtown employees priced out by such a decision be provided with an alternative – such as extending the hours of bus service. The resolution at hand does not seem to include consideration of such alternatives.

The resolution references the 2007 Nelson/Nygaard study of downtown parking, available online.



  1. Will someone in the know please elaborate here or elsewhere what is really going with this, both with the parking meters and with the second portion of the resolution regarding the Y lot net revenue? It’s very inside baseball I know but the implications may be quite a bit broader, and very scary. This may be only the beginning of a very complex run around. One that is happening much too fast for anybody not already up to speed to report on it accurately.


       —Mouthforcedshut    Dec. 19 '09 - 06:20PM    #
  2. Mouthforcedshut,

    The city wants more money to pay for the construction projects that are ongoing downtown (the city hall expansion and the really big hole next to the library). The city does not care about residents who live here because they are too busy taking care of the developers that run city hall. If they start collecting meter fees after 6:00pm until 10:00pm, they will make a fortune in fines for expired meters, and towed vehicle fines not to mention the meter fees. Google was given 400 free parking spaces in exchange for a non binding promise to bring 1000 jobs to downtown Ann Arbor which has been reneged on. Google now only uses 200 spaces so in theory, the problem of employees parking in on-street spaces could be mitigated by using the unused 200 spaces given to Google as designated parking for downtown employees. But don’t hold your breath waiting for this solution, the city “needs” the money to pay for more construction jobs and tax giveaways to developers.
       —ChuckL    Dec. 19 '09 - 07:01PM    #
  3. There is a very good story on the Ann Arbor Chronicle that lays out a lot of it. In my lengthy comment on it, I mentioned that the DDA instituted a very low-cost overnight parking permit that was aimed at downtown workers.


       —Vivienne Armentrout    Dec. 19 '09 - 07:36PM    #
  4. I have to say that there are not very many metered street spaces compared to parking structure or lot spaces. The meter spots are typically full. As a result, even if I drive around in the evening looking for a free meter I end up parked in a pay garage. As a result, I tend to only street park downtown in the evenings if I see an open meter on the way to a garage. I’m not sure it makes a big difference downtown.

    Kerrytown, on the other hand, would definitely be impacted since there is a lot of metered parking in that area. It does make one think twice about stopping in for a few quick purchases when you have to worry about how much time is left on the meter. I much prefer the structure “pay for what you use” model, rather than trying to over-pay a meter by just the right amount.


       —MikeP    Dec. 19 '09 - 07:58PM    #
  5. Chuck: Developers run city hall? You have proof of payoffs or what?

    The construction the city has underway is coming at just the right time to provide much needed jobs in a horrible economy. They are doing a much better job in the city than the feds are at putting people to work. This is a real boost to the economy. The construction jobs are essential right now.

    If you just follow the facts that have been published in the media recently you would know differently regarding your other points.

    The police/courts building costs the city $275,000 our of their operating budget. The money they save from rented space will make the bond payment. The city has to be out of the county courthouse by the end of 2010 when the lease is ended.

    They don’t pay for 400 spaces for Google, only for what Google uses and that ends next year. Would you have let Google move into the township?

    The bond payments on the DDA’s new parking structure are made by parking revenues. But the new structure will itself provide the lions share of the money. No structure, no money.

    The extension is as much about turnover as it is $$$. I just read the State Street Area Business Assoc. has wanted this for a long time to spur turnover of street spaces and put the longer term parking in the structures.


       —Gale Logan    Dec. 19 '09 - 08:21PM    #
  6. Developers do run City Hall.


       —Junior    Dec. 19 '09 - 08:25PM    #
  7. Gale Logan,

    Several of your comments have been repeated frequently and are still incorrect.

    The city paid several millions from the general fund balance to finance the city hall. One line item is $3 million that was supposed to be repaid from the sale of property for First and Washington project, but that project is on hold for lack of financing. Also, as I recall, the DDA is supposed to pay $500,000 per year toward the city hall (out of parking revenues, perhaps?). There have been other general fund expenditures related to the city hall, including the $600 K for the Tios building. Not all the cost of the city hall was included in the bonds and most of the rest was picked up by the general fund. The $275,000 you mention may be the yearly amount of the bond payment from the GF, but I can’t verify that.

    The material prepared by the CFO indicated that system-wide parking revenues would be needed to pay for the underground parking structure. (For those who want to delve into this, I made a lengthy exposition of it here.)

    The city could have extended the lease in the county courthouse if they had asked. They never asked. Bob Guenzel released a memo saying that he would not recommend a lease extension, but he is not the final decider. The county is out of money and closing departments and they are not in a place to refuse the lease payments and have no way to finance much new construction at the courthouse. I don’t know their plans now but at the time it was not an emergency.

    ChuckL, those Google parking spaces are all in the Liberty Square parking garage. They are not “unused” because there is always a waiting list. They are the ones allocated to McKinley and the city is charged for them as each one is requested.


       —Vivienne Armentrout    Dec. 19 '09 - 08:52PM    #
  8. Gale Logan,

    You asked, “Would you have let Google move into the township?” My answer: The question has as much credibility as asking a three year old if s/he wants a lump of coal or a present from Santa Claus. But I must say it is interesting you are either naive or cynical enough to believe a threat like Google’s supposed desire to move to the townships if they are not paid a sufficient amount of tribute from the public trough. So, you want proof of what I say but you don’t have to prove anything! I pay attention to what is going on and if you have been to a council meeting you can observe the council holding court with all of the developers there to sell their wares. Furthermore, where’s your proof the threat to locate Google in a township was nothing more than a hoax to extract more breaks out of the city? At this point, it would have hardly mattered since the 1000 jobs have become 200. If employees are parking in on-street parking, the city should require downtown employers to supply parking to their employees. The problem with the DDA plan that Vivienne mentions is that it requires the employees and not the employers to pay for the parking.
       —ChuckL    Dec. 19 '09 - 09:34PM    #
  9. Viv: Of course there was a down payment on the police and courts building. I said the $275 K was from the operating budget. It was a quote from the CFO in an article by Ryan Stanton about the retreat or the meeting after in A2.Com.

    I think one of the reasons A2 is doing better than other Michigan cities (remarkable with 45% of the land non-taxable!) is because they don’t spend capital savings on the operating budget. That is what gets so many govs. in fiscal trouble.

    As I remember it the city asked the county for a lease extension and the county only gave them one year. They said the city could build on the county site but would have to pay rent. What sense would that make?

    There is a letter from Guenzel telling the city they had to move. The County Clerk said on this web site that the County wants to move the juvenile courts into the space where the city courts are.

    The DDA should be paying toward a new courthouse and police station in the DOWNTOWN.

    In any event the city has needed a new police station for decades, anyone who was ever downstairs knows this. It was smart to put the police and courts together. And the city will save $700 K per year in rents to make the bond payment.

    I said the “lions share” of the $$ to pay the bond on the new structure will come from the 700 spaces in the structure, not all of it.

    That will indeed come from the parking system as a whole. That is how the DDA has paid for all the other structures. With the parking that stands to be lost in the next few years (some time back Sabra Briere posted a list on arbor update) this is a smart move to assure downtown has parking when the recession ends.

    Also, did you know that parking has not gone down in the recession but is going up! This is a good sign for A2.

    Let me also add that many people I know really appreciate the police station and parking structure construction because of the good paying jobs.

    As I said before the locals here are doing a good job of providing work with needed projects, much better than the federal govt. The timing is perfect the city got low rates and lower costs and the jobs are here when they are most needed.

    The construction at the city and UM is doing a lot to keep the local economy afloat.


       —Gale Logan    Dec. 19 '09 - 09:50PM    #
  10. Gale Logan,

    Tell the 14 firefighters who got laid off because the city needed to make cuts to pay for the new PD building that the construction jobs are a good thing.
       —ChuckL    Dec. 20 '09 - 01:33AM    #
  11. That’s just it Chuck. They didn’t need to make cuts. The new building requires only $275,000 per year from the operating budget and what would the city be doing for a court house after the end of 2010?

    Maybe the judges would be holding court in a store front and they could bring a lawsuit saying the city was not providing them with a secure court space as called for?

    The $275,000 would pay for three fire fighters? (And they aren’t laid off yet.) Or would you spend it to keep Mack Pool and the Senior Center open? But wait you can only spend it once per year.

    Besides all that, I guess I don’t understand why people stopped having pride in civic buildings. Why shouldn’t a city have good facilities for their police and courts if they can work it out to have such a small impact on the operating budget.

    The financing and timing of the building were well worked out, the city sold low interest bonds, got low bids on materials, etc. and put a bunch of people to work.

    Wasn’t this thread about parking?


       —Gale Logan    Dec. 20 '09 - 02:04AM    #
  12. Gale Logan,

    Your numbers are incorrect. How do you spend over $40 million without raising taxes and not cutting spending on other things? You can’t and did you know the courts use to be in the current City Hall? The rent savings are not real since the 100,000 sq-ft expansion is twice the square feet that were rented before, wiping out any savings by not renting. The City Center building could have been bought for less than 1/4 the cost of the current expansion. The thing that really galls me is that the issue of funding the expansion was not put to the voters because the city new if the question had been put to voters, it would have gone done in flames. BTW, the current spending spree for the PD Building and the big hole by the Library will reduce monies for services that benefit residents of Ann Arbor directly, like fire fighting service.
       —ChuckL    Dec. 20 '09 - 06:42AM    #
  13. Sorry Chuck, I was just using published numbers, right from the city CFO. The total impact of the new building on the city operating budget will be $275,000 per year. Can’t put it more simply. The city is saving a bundle on rent and the DDA is kicking in with some TIFF funds, effective and creative financing.

    Of course there was a down payment but that was capital money. The key point to consider is the effect on the year to year operating budget.

    The city has a great new asset that will last a long time. The police were never intended to stay in the basement of the Larcom building and finally they have a new headquarters and there will be secure space for the courts. The security requirements changed over the years since the courts were in Larcom, that’s why the city could not find existing space that would work, not that they didn’t spend years looking.

    You are simply wrong about the new parking structure it does not take a penny from the city general fund that pays for the FD. It is all parking fee money and the DT will need the parking.

    If you wanted to go back through the topics here you could find the list of parking the city has lost or anticipates losing in the next few years that Sabra Briere posted. It would be a giant mistake to leave downtown without adequate parking. Most people think there is not enough now.

    But again, the new structure will be paid for with parking revenues, a large part from the new structure and some from the whole parking system.

    It won’t take away any operating money from the city budget, won’t touch it.

    A couple of million from parking has been going to the city general fund. It would be a mistake to take more and leave the system to rot like it did in the 60’s and 70’s.

    As much has you want to prove the impact on the budget is greater, it just isn’t.

    Now about that evening/night-time parking…. It won’t hurt to go to 10 PM. It makes sense if that is when the people are there. What is really different between 9 AM and 9 PM? Don’t want an expired meter ticket? Park in a structure. Easy.


       —Gale Logan    Dec. 20 '09 - 04:11PM    #
  14. Gale Logan said, “Don’t want an expired meter ticket? Park in a structure. Easy.” You’re missing the point! I don’t want my local government engineering schemes that are intended to financially ensnare residents and separate them from their money while giving millions in giveaways to developers; funds to operate government should be based on ability to pay and should come from local property taxes. If the council can’t/won’t go to the voters with a property tax increase to pay for these projects, they should not spend the money, period! You can believe CFO Tom Crawford’s smoke and mirrors accounting all you want; the new hole in the ground next to the Library will not pay for itself and is therefor a bad idea. Washington D.C just got into trouble by paying $40 Million for 1000 spaces of underground parking; Ann Arbor is proposing to spend $55 million for about 800 spaces, what a crock!


       —ChuckL    Dec. 20 '09 - 08:24PM    #
  15. Chuck: You are starting to rant. So the city CFO is using “smoke and mirrors” and exactly which developer is getting “millions” in “giveaways?”

    The new parking structure will go a long way toward paying for itself but just like all the other parking structures built in the history of the DDA, the entire parking system will help pay for it.

    On top of that the new structure will support a couple of hundred good jobs for two years. If you don’t like that you must be way, way down on Obama.

    The project was competitively bid and the lowest price found.

    If I remember right the parking structure funding includes about $16 million in related streetscape and infrastructure improvements. But it’s convenient for you to leave that out.

    Smoke and mirrors anyone?

    What is interesting is that looking around it
    appears that A2 is surviving the worst economy in 80 years better than most Michigan cities. But unlike Grand Rapids, Ypsi, Troy, Lansing, etc., etc, and all the bankrupt or near bankrupt towns; according to you and a few dedicated others, in Ann Arbor the problem must be a conspiracy. The CFO must be lying, etc.

    Please think about it Chuck. The city already had 45% of the land off the tax roles and then the UM took away 4.00% of the revenue and more state revenue sharing rollbacks hit. Why wouldn’t the city need to make cuts or find new revenue? How many sizable Michigan cities are not not doing this?

    As for the meters. Turnover is important. I understand the State Street Business Assoc. is in favor of extending the meter times. If you don’t want to feed a meter or get a ticket, take the bus, bike or park in a structure, it’s simple.


       —Gale Logan    Dec. 20 '09 - 09:19PM    #
  16. Gale Logan said, “If I remember right the parking structure funding includes about $16 million in related streetscape and infrastructure improvements. But it’s convenient for you to leave that out.

    Smoke and mirrors anyone?”

    The $16 million Gale is referring to will pay for reinforcement to support a 10 story hotel/conference center and geothermal heating for said complex—corporate welfare to the Valiant Partners if there every was such a thing (for those not in the know, Valiant Partners has the inside track on winning the bid). I wonder if voters would approve a millage increase to fund these $16 million in “streetscape and infrastructure improvements”? I doubt it; which is why the city needs to engage in subterfuges like increasing fees from parking to raise the cash.


       —ChuckL    Dec. 21 '09 - 01:42AM    #
  17. Sorry to burst another conspiracy bubble Chuck but it would be a huge waste to dig a big hole and not put in geothermal. It’s not corporate welfare but it is a smart fiscal and environmental move. Actually it will soon be the norm. It would be stupid not to install it. Other Michigan cities are doing it in order to create their own heating and cooling utilities.

    The users have to pay for it of course and you get your money back and then some. The Library can tap in, other buildings can tap in. It can be piped quite a ways.

    Try to get past the conspiracy theory and think a bit. If you want energy efficiency, if you want LEED buildings; it is a whole lot easier to do if there is geothermal to tap into. One downtown business has already done it for themselves.
    I am 100% behind the geothermal.

    Increasing parking fees is a “subterfuge?” Like they can do it without anyone knowing it? Wow.

    If you look back over the years the DDA has been maintaining and building the parking system you notice increases every so often. Everything costs money. I bet parking fees go up over time in most towns. Royal Oak went to 10 PM. But in A2 it’s a “subterfuge?” Got it.

    BTW the street scape also includes “Library Lane” new pipes etc. and other nice improvements. It is going to be very nice. But hey it is all part of a plot. Ten members of city council voted for the parking structure, tell us, are they all in on it? Are they getting paid off? Is the fix in?


       —Gale Logan    Dec. 21 '09 - 06:42AM    #
  18. “If you don’t want to feed a meter or get a ticket, take the bus, bike or park in a structure, it’s simple.”

    What’s that bumper sticker: “Welcome To Ann Arbor-Now Go Home”?


       —Alan Goldsmith    Dec. 21 '09 - 02:25PM    #
  19. Gale Logan,

    Your ability to change the subject in order to avoid the elephant in the living room is truly amazing! Valiant Partners has been given an inside track to win the bid (the whole bid process was designed around the pre-ordained conclusion that Valiant Partners would win) and you are running interference for the whole operation, congrats!
       —ChuckL    Dec. 22 '09 - 12:03AM    #
  20. Yes Chuck, I am part of the vast conspiracy to have an eco-conscious, LEED standard, tax-paying, park-included, well designed development in downtown A2 that sits atop a much needed, sprawl-preventing, aesthetically pleasing and well lit underground parking structure.

    But, I wouldn’t bet on Valiant.

    Back on topic, let’s extend the meter hours until 9 PM.


       —Gale Logan    Dec. 22 '09 - 08:00AM    #
  21. Gale Logan,

    Tax paying? Just like Lower Town, right? So, Gale, can you fill us in on the occupancy rates for hotels in Ann Arbor? I heard they are down significantly; so even if your hotel is a success, it will be poaching business from already existing facilities. Is this your idea of public-private partnership; rob Peter to pay Paul? Meanwhile the Stadium street bridge is falling down and potholes abound. I guess the 14 firefighters slated to get laid off will have to beg for a job building the underground parking structure; then the city will appreciate their service.
       —ChuckL    Dec. 22 '09 - 02:51PM    #
  22. ChuckL, you don’t understand, The vast crowds of tourists who will come into A2 to view the new Urinal art piece at the Court-Police Building will need SOMEWHERE to stay. And the beauty of this is, we won’t NEED firefighters because how can a water fountain catch on fire? So what if your tax dollars are going to be backing this new fiasco. Get on board with the 21 Century Ann Arbor Democratic Party.

    Al Wheeler and Ed Pierce are rolling over in their graves.


       —Alan Goldsmith    Dec. 22 '09 - 03:01PM    #
  23. You assume too much, I don’t think there is enough business to support a conference center. Hotel occupancy is down everywhere right now. But anyway, the current economy should not be used in analyzing proposals that won’t even be finished until late 2012. But I don’t care if its a hotel.

    I want to see a park and a building that pays taxes and adds to the activity downtown. The parking structures fill up every day now, the city needs more parking and it should be underground. I want adequate parking so new business will locate downtown (attracted by the artsy reputtion of A2) and most importantly, new jobs. The construction jobs will be a great boost in the next two years.

    But you are mixed up again. You can’t spend parking money from spaces that are not yet built to pay for bridges or whatever.

    Al Wheeler and Ed Pierce, both UM professors and mayor’s willing to take a stand, would love the councils strength is sticking to the art program in these tough times and not falling for the short term political “win” by going for the symbolism of cutting the program.

    Every city in Michigan and many beyond is having to cut back, why should A2 be different? Just look up from your local blog for a minute.


       —Gale Logan    Dec. 22 '09 - 04:41PM    #
  24. “Al Wheeler and Ed Pierce, both UM professors and mayor’s willing to take a stand, would love the councils strength is sticking to the art program in these tough times and not falling for the short term political “win” by going for the symbolism of cutting the program.”

    Then you obviously are clueless about Wheeler and Pierce and what they stood for.


       —Alan Goldsmith    Dec. 22 '09 - 06:32PM    #
  25. Gale,

    symbolism? Symbolism of cutting an unnecessary and wasteful program? It’s real money better spent through the funds out of which it came.


       —Tom Hollyer    Dec. 22 '09 - 07:16PM    #
  26. Symbolism in that a no vote makes you a big man in the eyes of some but little would really be accomplished.

    Symbolism in that voting against art right now wins big credits with some but in reality the money in the art fund would do very little in each of the funds it came from, it can’t fund the PD or FD, but it can buy a whole lot of art.

    More bang for the buck in this case.

    If you are against art programs then I guess you are. Everyone has an opinion. But voting no on this project does very, very little for roads or sewers. It is disingenuous to say does but it makes a good sound bite. The fund is mostly made up of money from many different sources.


       —Gale Logan    Dec. 22 '09 - 08:31PM    #
  27. Gale, enough of the straw man thing. Just because people are opposed to elitist horrible art, money being spent with no budget, no plan and being handled by people with zero project management skills (or apparently accounting skills as well), while public safety is at risk, that doesn’t make them against art. It would be like me saying you are anti-life and want people to die in horrible fires because you don’t understand less fire department staff is going to lead to more deaths.


       —Alan Goldsmith    Dec. 23 '09 - 12:27PM    #
  28. Re: free parking — A retailer in Ypsi mentioned her absolute frustration with the free holiday meters on the street there, because then non-shoppers park all day. While personally I love the idea of parking for free (of course!), I can see how it’s bad for the downtown shops. (as much as it goes against my personal interest to admit it…)


       —Suzie    Dec. 26 '09 - 03:23PM    #