FATE OF BUCHANAN’S DDA MAY BE DECIDED DURING UPCOMING COMMISSION MEETING

By DEBRA HAIGHT
BCR Correspondent

BUCHANAN – Could the city of Buchanan join the growing list of Michigan communities voting to disband their downtown development authorities? The answer to that question could come as soon as the next Buchanan City Commission meeting on Monday, June 8.

As Buchanan City Commissioner Sean Denison noted at last week’s City Commission meeting, other communities

have done away with their DDAs in recent years. Denison chaired the city’s DDA Ad Hoc Committee the last several months and gave the committee’s report at the May 26 meeting.

“I can name at least 10 other communities that have done away with their DDAs for many of the same reasons we face,” he said. “They saw a loss of revenue and were figuring out how to pay their expenses and still have anything left over to do projects.”

Examples he gave of communities that have dissolved their downtown development authority included Oscoda Township, Cedar Springs, Port Sanilac and Evart. In one instance, the local DDA faced the loss of revenue with the closing of a large business. In other cases, communities felt that their DDA had fulfilled their mission.

Denison and fellow City Commissioner Mark Weedon said they believe the economic development of the downtown can still be accomplished without having the DDA in place. They recommended the DDA’s funds be redirected to a dedicated city fund for downtown development.

Denison said the tension between the DDA and city officials over mission and money in the last year was one reason why he and Weedon favor dissolving the DDA. “The negativity of the Authority casts a shadow on our community that could have serious, long term economic ramifications,” he wrote in the committee’s report.

He noted that the current DDA has had limited success in completing projects due to not only the conflicts between DDA members and city officials but also the turnover in membership. He said the DDA has reserves of over $160,000 and another $164,000 in cash and investments that are not being used on projects in the district.

He added that DDA revenue are decreasing with tax increment financing revenue falling 33 percent this year alone. That revenue drop is due to tax changes which will exempt all eligible manufacturing personal property from taxation by 2023 as well as exempts small businesses with less than $80,000 in cash value from personal property taxes.

Weedon said he sees dissolving the DDA as an opportunity to regroup and restructure. “Restructuring is not entirely bad, I believe what we put forth gives us that opportunity,” he said.

“It is our belief and sincere hope that these recommendations will provide a more focused plan to promote economic growth and to increase property values in our downtown district while continuing to preserve and promote our quality of life and quality of place,” their section of the report concluded.

The other two members of the Ad Hoc Committee, Adam

Burck and Fran Terry, have a different perspective. They’re recommending that the DDA sign a contract with the city to provide services and continue operating with training for members and the rewriting of by-laws.

“In this era where nothing is really sure, the DDA is operating and is a sure thing,” Burck said. “It’s better to work with what we have rather than the unknown. This is a tool already in the toolbox.”

Terry said that the revenue the DDA collects from tax increment financing has helped the downtown. “My concern with having downtown funds being a line item in the city budget is that down the road the commission and the city manager will change,” she said. It would be very easy to say we can’t afford to spend money on the downtown and take it.”

The Burck-Terry proposal would retain the DDA, but

reconstitute its membership. The new DDA would work with the city to rewrite by-laws and rules of procedure. They pointed to successful DDA projects of the past such as new welcome signs, the bridge at the duck pond, the farmers market and grant/loan programs for downtown property owners.

“We are well aware that … the funding that the DDA receives from tax revenues have continued to go down over the last several years, but even with a lesser revenue there is still valuable work that can be done with our fund balance and if we use it wisely the DDA can be valuable for several years to come,” Burck and Terry concluded.

“The unique strength of a DDA is its inherently democratic nature, putting the community in charge of its economic development. It is the only situation where taxpayers get to decide how to use the taxes they pay; just as a municipality determines how to spend their tax revenue. This empowers the local DDA to implement the economic and community development that is best suited to this unique community.”