Local in Ann Arbor

As discussed in our previous post, the Percent for Art program is the result of the Public Art Ordinance passed by Council in 2007.   This has been a signature program of the Mayor, John Hieftje, who campaigned on it as its champion.

As the Ann Arbor Chronicle has reported through a series of articles, the “poster child” for this program is the Dreiseitl project. With every new discussion comes a series of outraged comments from readers.  The project itself has come in for plenty of criticism on practical and aesthetic grounds.  But many of the comments, like this one from the AnnArbor.com commenter John Galt, address the cost at a time of scarcity and other priorities for the city:

Bridges are near collapse. Roads are crumbling. There will be less snow removal. Police and Fire Budgets are to be cut. The school budgets are to be cut. —Fine, we are in a recession—these things may need to happen. BUT, we should shuffle the money to maintain the basics and cut or eliminate the “nice-to-have” items until we recover. This is clearly a nice-to-have item. And I cannot support this type of spending with the rest of the city and country crumbling around us. (It’s like a homewner, who cannot afford to pay the mortgage and heat, who decides to go out and buy that flat-panel TV.—got to have priorities.)

As we speculated earlier, councilmembers who voted for the Percent for Art program in November 2007 must have been surprised at the numbers of dollars actually flowing into this program.  It probably sounded as though it would be just a little bit added to big projects (how big can 1% be?).  Indeed, AnnArbor.com, in its recent editorial supporting the approval of the sculpture,  continues this image: “Two years ago, Ann Arbor joined cities like Madison, Seattle, Austin and Santa Fe in setting aside 1 percent of money from development projects to support public art.”

But Council didn’t read or understand what they were signing off on.  The ordinance doesn’t say “development” or “buildings” or even “construction projects beyond minor additions”.  It says capital improvement projects.  The capital improvement budget of the city is very big and very complex.  There are a few exclusions, but otherwise this means that every capital improvement the city does is subject to this surcharge.

Here is the actual text:

Except as otherwise provided in this section, all capital improvement projects funded wholly or partly by the city shall include funds for public art equal to one percent (1%) of the construction costs identified in the initial project estimate, up to a maximum of $250,000 per project. Where a capital improvement project is only partly funded by the city, the amount of funds allocated for public art shall be one percent of that portion of the project that is city-funded, up to a maximum of $250,000 per project. All appropriations for capital improvements falling within the provisions of this chapter shall be deemed to include funding to implement the requirements of this section 1.

As CM Kunselman is quoted, when he voted for the Percent for Art program, “he said that he did not realize at the time that the program would pull money from what he thought were restricted funds”.  In our previous post, we quoted his questions to the city attorney (answers were confidential and not made public) as to whether the parks millage and an enterprise fund like the stormwater fund could legally be assessed for this program.  Clearly to this point the assumption has been yes.

Looking at the line item assessments for the program is even more startling than looking at the summary numbers.  (See FY 08 arts funding (total to the arts is $328,889) and FY 09 arts funding (total to the arts is $530,457.)  Did Council really think that they would be assessing the street resurfacing program (over $160,00 projected through FY 2011)?  And sewer mains?  ($826,725 projected through FY2011.)  Those are infrastructure, not “development”.  And, as CM Kunselman highlighted, did the voters intend to vote for art when they voted for the parks millage?  (It certainly wasn’t on the ballot.)  There is an effort, as with the recent West Parks improvements, to say that the funds will be used for art at that location.  But it is difficult to imagine art associated with the “WWTP Sewage Pumps Repair” (I scarcely think many of us will be visiting the wastewater treatment plant for an aesthetic experience, though I’m sure it could provide one).  That last item, by the way, yielded $2,799 for art.  The “Solid Waste Management Plan Update 2008-2013” gave the arts $1,000.  For the “Water System Distribution Monitoring and Security”, the arts gained $17,500.  And single-source recycling, not yet instituted, is already forecast to provide the arts with nearly $55,000 in 2010 and 2011.  A real puzzlement is that the arts are charging the city for $1000 for  “Landfill Closure”.  I’m guessing that the Stadium Bridge reconstruction is already ticking up the dollars nicely (a spreadsheet not shown here projects $14,000 for bridging art in 2010 and 2011, but I’m guessing all the costs have not been registered yet).

Beyond ridicule, these charges against basic infrastructure and operations raise major concerns.  As CM Kunselman identified, the water utilities are enterprise funds.  That means that they have to produce a balanced budget – or we all see raises in our water and sewer fees.  Likewise, programs funded by a millage were voted in to provide very specific services and benefits.  If we cream off a percent, it means that dedicated funds, which were sold to the voters for one purpose, are being diverted for another.  That is in a sense a fraud and is also a loss of service (yes, I’m still sore about that $7,000 that was denied to Project Grow).

Margaret Parker, the chair of the Ann Arbor Public Art Commission, is quoted by AnnArbor.com as saying that the council should go ahead and spend the money on the Dreiseitl project because “If the money were not used for this piece, it would go back to the Public Art Fund and could not be used for any other reason. Even if the Percent for Art ordinance were eliminated, the money would go back to the designated funds for the capital projects that generated them – sewer, water, transportation, etc.”  (This was in counter to the idea of spending the money on the homeless, etc.)  But why should these funds be taxed for art?  It is not free money.  It is money being taken directly from needed infrastructure and services.  It is adding to the cost of doing ordinary business at a time that the city is cutting budgets elsewhere.  It means that additional money needs to be found, or services and infrastructure improvements reduced.  How can that be justified for what is, after all, a discretionary use?

Christopher Taylor, in an email to constituents detailing his accomplishments (and disappointments) for the year, said, “Council will address the Commission’s proposal in December and, I  believe, a temporary reduction in the Public Art Program”.  I hope that this is so.

The next post will discuss the Bolt Decision and its importance in deciding the legality of these charges to fee-paid and millage-dedicated funds.

UPDATE: Here is the text of an email sent by Karen Sidney to Mayor, Council, and a host of interested citizens (Dec. 2, 2009):

Dear Mayor and Members of Council: I have been following the discussion of the art in public places program. I have several questions that have not been answered by the discussion to date.

1. Why has 1% from ineligible capital projects been transferred to the Art in Public Places Fund? A comparison of the city staff prepared spreadsheet by project with the city’s financial reports shows that $18,300 was transferred to the Art in Public Places Fund in fiscal year 2008 for ineligible projects. Another $39,500 was transferred in fiscal year 2009. The ineligible transfers are included in the total reported in the city’s FY2008 audited financial statements.  The FY2009 financial statements are not yet available.

2. Why was $10,000 from the new corporate hanger project not transferred to the Art in Public Places fund? Did the corporate hanger project include at least $10,000 for art as part of the project?

3.Why are there no transfers to the Art in Public Places Fund for the police/courts building and why does the staff prepared schedule fail to include $250,000 from the police/courts building project? Is the intent to pay $250,000 for the Dreiseitl project directly from the Ann Arbor Municipal Center fund (fund #8) and the balance from the Art in Public Places Fund?

4. For the portion of the Dreiseitl project paid from the Art in Public Places Fund, how does this expenditure meet the ordinance requirement that it be related to the purposes of the funds that have transferred money to the Art in Public Places Fund? For example, the Streets Millage Fund and the Sewer Fund are the two largest contributors. How is the Dreiseitl project related to the purposes of these funds?

Thank you for your attention to this matter.

SECOND UPDATE: The Council voted on December 7 to reduce the percent from 1% to 0.5%.  This did not alter the structural impropriety of the program, but is a short-term fix.

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