For more than three decades, the Traverse City Downtown Development Authority (DDA) has managed parking for the City of Traverse City. But what initially started out as an agreement in 1991 for the DDA to oversee downtown parking spots has significantly expanded over the years to include two parking decks, employing more than a dozen staff, and managing parking outside the DDA boundaries – including in neighborhoods and areas like NMC and Munson. Now city commissioners will discuss a proposal tonight for the city to take back over parking services – a proposal that has support among both city and DDA leaders.

According to City HR Director Kristine Bosley, the city approved an agreement 33 years ago delegating authority to the DDA “for the operation and expenditure for parking needs in the downtown area.” At that time, all employees working in parking remained city employees except for the parking administrator. The agreement was updated in 2003 to fund the administrator position and hire more staff to run the new Larry C. Hardy Parking Garage.

The DDA’s workload continued to grow in subsequent years, including running the Old Town Parking Garage, the parking violations bureau, residential parking, and lots around NMC and Munson, among other responsibilities. The city employee positions became DDA employee positions. There are now 13 employees in the parking department across office, field, and maintenance operations, plus two additional open positions, according to DDA Transportation Mobility Director Nicole VanNess.

The scope of the DDA “to oversee parking needs in the downtown has grown to include parking throughout the city,” says Bosley. In memos sent to commissioners, Bosley and City Manager Liz Vogel recommended terminating the agreement with the DDA and having the city take back authority given the extent to which parking now extends beyond downtown limits. Mayor Amy Shamroe, who sits on both the city commission and DDA board, agrees the issue is worth exploring.

“The only meters we had for a long time were in the downtown and were under their purview,” she says. “Now we have meters that far extend beyond the DDA boundaries, and they are also covering things like neighborhoods and permits. It’s at least an important conversation to have in light of all those changes.”

Bosley outlined several factors city commissioners will have to consider if such a transition occurs. A key one is staffing. Both VanNess and Shamroe envision a scenario in which the parking system – including staff – continues to operate very similarly to how it does today, just under the city instead of the DDA. “I would hope it’d basically slide from the DDA to the city but leave the employees and structure primarily intact,” Shamroe says. VanNess anticipates her role would also likely become a city instead of DDA position. The move could offer an opportunity to improve alignment among city services and offer more staff support for other areas, VanNess says, such as implementing the city’s new mobility action plan.

Bosley says the city will review options for “absorbing the employees currently involved in parking operations. This would involve integrating them into the city’s workforce, addressing union negotiations, and ensuring that staffing levels meet operational requirements.” Unionization is another key factor: The city is in union negotiations, and DDA employees becoming unionized city employees could mean additional incurred costs in “wages, fringe benefits, and other expenses such as defined benefits and health care savings plans,” Bosley wrote.

Parking is an enterprise fund, meaning parking revenues are used to pay for expenses – making it a self-sustaining department. The parking budget includes an $816,000 annual contract fee with the city to cover personnel costs. That employee cost would still be in the budget under city management – it’s essentially just moving line items, VanNess notes – though Bosley says the city will need to identify any additional potential costs.

The city will also need to evaluate parking operating procedures, assess the condition of infrastructure, and plan for parking improvements, according to Bosley. “The city would have direct oversight to establish (parking) rates, and the management of parking facilities, including maintenance, repairs, and upgrades,” she wrote. Bosley suggested the transition could happen at the start of the city’s next fiscal year, which is July 1. That would allow city commissioners to plan for the transition in the budget this spring.

“Any decision to terminate the agreement with the DDA and take over parking operations would need to involve discussions, a review of variables, and ultimately a vote by the commissioners,” Bosley wrote. City commissioners will be in study session tonight, meaning they won’t take any action but will provide direction to staff, who could then return at a future meeting with a motion for a vote. Bosley wrote that “it’s important to recognize that parking operations impact the entire city, not just the downtown area. By carefully evaluating these considerations and engaging stakeholders in the transition process, city management can develop a comprehensive plan that ensures a smooth transition and maintains quality service delivery to all residents, employees, and visitors of Traverse City.”

In addition to the plan being supported by Bosley and Vogel – and Shamroe calling the proposal a “logical” plan for consideration – Vogel says former DDA CEO Jean Derenzy also “requested that we assume the provision of parking services.” VanNess sees the benefits of the concept as well. She points out that the DDA is in the middle of searching for a new CEO, a position that up until now has been heavily consumed with parking oversight. That could make it challenging to find candidates who might otherwise be a great fit for the DDA but aren’t interested in parking management.

“I don’t think you’ll find another DDA in the state that manages parking services the size of ours,” VanNess says. “I think it’s one of those things where we’ve just outgrown the DDA in our operations. With new union contracts, a new city manager, a new city treasurer and engineer, a new DDA CEO coming...there are only so many times where all these things align. It’s a good opportunity. If we were going to do something, this would be the time to do it.”