Traverse City Downtown Development Authority (DDA) board members approved three budgets Friday for the upcoming fiscal year totaling over $8 million. DDA CEO Jean Derenzy reviewed several key projects that will be covered by those budgets and shared updates on other projects underway downtown, including bridge construction and the launch of a new retail incubator.

Derenzy reviewed the 2023-24 budgets as part of a twice-yearly informational report to the community required to be provided by the DDA. The largest of downtown’s three budgets at $5,021,003 is for the TIF 97 district, which covers the main core of downtown. Derenzy noted that the captured taxable value within the district is projected to be $162,805,778, bringing in $4,355,361 of revenue. According to Derenzy, the focus of the TIF 97 budget in the next year will be “two transformational infrastructure projects” in redesigning the Lower Boardman riverwalk and creating a new public parking deck on State Street.

Derenzy said the parking deck project is now being viewed as a mixed-use development rather than just a parking structure, because it will contain retail and housing in addition to parking. “We really need to look holistically at the site and the value and priorities of the community,” she said. One million dollars in the TIF 97 budget is allocated for design and engineering for the development and the riverwalk. The budget also includes $200,000 for the two-way pilot project on State Street, Pine Street, and Boardman Avenue, as well as $200,000 for the TART Trail extension downtown and $325,000 for streetscape and snowmelt improvements in the district.

The Old Town TIF budget – covering the Old Town and Midtown areas – comes in at $1,108,450 for 2023-24. The captured taxable value for the district is projected to be $33,011,175, bringing in $841,481 of projected revenue. The two biggest projects on deck for Old Town include $300,000 to replace the Midtown riverwalk and $300,000 to redesign the intersections of Eighth Street/Cass Street and Eighth Street/Union Street. “The new intersections will utilize a design similar to the intersection of Union and State, which has proven to hold up better over time,” according to Derenzy. Streetscape and snowmelt improvements are budgeted at $100,000. Both the TIF 97 and Old Town TIF budgets include allocations to make improvements under the city’s new mobility action plan, which is in the process of being finalized.

The third DDA budget is $1,931,359 for the general fund. Those dollars cover all staff costs, as well as contracts with the city to manage parking and with the Downtown Traverse City Association for marketing and communication services. DDA board members voted unanimously Friday to approve all three budgets, which already received city commission approval earlier this month. The DDA’s new fiscal year will start July 1 and runs through June 30, 2024.

Derenzy also gave updates on several other downtown projects. DDA board members approved a recommendation from Derenzy to enter a contract with Team Elmer’s for $35,500 to complete a project in the 200 block alley of Front Street. Crews have been working in the alley for months to stabilize the river wall. After city staff noted that the alley hasn’t had any new paving beyond patch work for years and that Team Elmer’s could complete that work while they’re already on-site for stabilization, DDA board members agreed to cover costs for a mill-and-fill project in the alley. Work to realign the sanitary sewer main in the 100 block alley and provide new leads to existing businesses will be complete by the end of June, according to Derenzy. The entire parking lot in that alley – Lot A – is being resurfaced as part of the project.

According to Derenzy, city construction on the North Cass Street bridge remains on schedule and is expected to be complete by the end of June. The South Union Street bridge, meanwhile, is scheduled to open to traffic by the end of July. That delayed timeline has required the National Cherry Festival to reroute its parades this year. Festival organizers recently announced that the new routes for the Consumers Energy Community Royale Parade (a combination of the former Heritage Parade and Junior Royale Parade) on July 6 and the DTE Energy Foundation Cherry Royale Parade on July 8 will now run down Front Street, turn south on Oak Street (instead of Union Street), and end at Thirteenth Street.

DDA staff are also working on launching a new retail incubator approved by the DDA board in April. The incubator will use nearly 2,000 square feet of ground space at 116 Cass Street next to The Pub to provide space for up to 10 start-up entrepreneurs to test out their retail concepts. The DDA will contribute an estimated $87,000 for the ground-floor buildout, which would include public restrooms, a new entryway on Cass Street, and interior renovations to create individual retail stalls. The DDA has finalized a 10-year lease agreement for the space, with the option to renew or opt out after five years. In addition to the DDA buildout and a $50,000 annual allocation from the TIF 97 budget, other funding streams – including an $80,000 USDA grant and $37,000 from the Michigan Economic Development Corporation – will help cover costs, according to a project pro forma, with the possibility of more grants to come. Tenant rent, sponsorships, and building programming will also offset expenses.

According to Derenzy, “over the next few weeks, we will be working to finalize the buildout and furnishings of the site, conducting interviews with other retail incubators in Michigan, and doing a few stakeholder/potential listening sessions” as the DDA works toward a targeted Labor Day weekend launch.