DDA Talks Money; Attempts to Fight Council Efforts to Slash Discretionary Spending

~ by Bob Volpe ~

Last week’s monthly meeting of the Downtown Development Authority (DDA) was dominated by budget talks and the growing attempts by city council to eliminate the DDA’s discretionary spending.

The meeting began with DDA Treasurer Tanner Coy giving a detailed accounting of last year’s profit/loss statement.   But the thrust of the discussion focused on the city council’s attempts to limit the DDA’s discretionary spending to zero.

According to Coy, the city council has listed much of the DDA’s expenses as “discretionary.” Some of the expense items council listed as discretionary are: telephone service, information technology, beautification, and professional services.

By cutting the DDA’s discretionary spending to zero, the council would effectively eliminate the DDA’s website, which is the main source of the DDA’s ability to remain transparent with the community, according to DDA board leaders. The DDA’s website includes links to DDA documents, meeting minutes, and email contact links to the DDA board members, ability to stream live meetings and much more.

While the council does not have the authority to defund the DDA, they do have budget authority to restrict or eliminate expenditures. By eliminating the DDA’s authority to spend items listed as discretionary, the DDA would only be able to spend money on debt services, Tax Increment Financing (TIF) reimbursement, and for legal services.

Contrary to many opinions, the city does not fund the DDA. The DDA’s income is completely generated from the TIF revenue, which mainly deals with property valuation hikes since the district was formed. In addition, TIF  monies add to the city’s revenue.

Ending the DDA

For some time, certain council members have been on a quest to completely eliminate the DDA. Should the city somehow shut down the DDA, the city would be required to assume all debt held by the DDA and would have to pay all TIF agreements. It would also significantly reduce the amount of TIF revenue the city receives. So, all of that debt would have to be paid through the city’s budget.

A meeting was held last week with city council to discuss the 2021 budget. The DDA sent Coy as a representative to explain the need for the DDA to continue to be able to spend discretionary money in order to maintain their transparency with the community.

As far as the DDA’s budget goes. Coy said the DDA ended the year 2020 with a net positive income of $57,978.

According to the DDA’s profit/loss statement, the DDA’s total income for the year was $682,639.  Their budget for the year was, $707,223.00. This left a balance of $25,597 in the black.

On the expense side of the ledger, the DDA spent $231,755 of the budgeted $392,309  for expenses. This saved the DDA $57,978 from the budgeted expense projection.