Flagstaff staff outline plan to fund downtown cleanup and services through parking-fee increase

City staff and downtown business leaders laid out a plan Friday to pay for more frequent cleaning, restroom maintenance, snow and alley clearing and other streetscape upkeep by dedicating new parking revenues and existing tourism/beautification funds to an outside contractor.

The proposal centers on modest increases to ParkFlag hourly rates that would flow to a parking lockbox; under staff estimates, a 50-cent increase would produce roughly $294,000 a year for contracted downtown services, a 75-cent increase about $440,000, and a variable weekday/weekend increase about $380,000. Dave McIntyre, community investment director, said the city also has about $300,000 in one-time ParkFlag funds that could seed a contract so enhanced services can begin before any rate change takes effect.

Why it matters: Downtown businesses and tourism leaders said improved maintenance would protect visitation and local commerce. Staff and the Flagstaff Downtown Business Improvement and Revitalization District (FDBIRD) described this as a way to show visible results before asking the public or regular parkers to absorb higher rates.

Heidi Hansen, economic vitality director, told council the downtown group requested roughly $500,000 over five years for a third-party operator to deliver enhanced services and that a professional vendor, such as Block by Block, would likely need at least $400,000 a year to set up and operate in a new market. “It probably would be challenging to come for less than, like, $400,000,” Hansen said.

Staff proposed a split of revenue from a parking-rate increase: roughly 75% of net new revenue would be dedicated to the downtown contract (to flow to FDBIRD or its contractor under an amended intergovernmental agreement) and 25% would help ParkFlag cover its operating cost increases. Staff noted 8–11% of parking revenue is lost to credit-card fees because the average transaction is small; raising rates would modestly improve that ratio.

Council reaction was generally supportive of further study. Several council members said they would consider a larger increase than the initial scenarios if analysis shows it is reasonable and if business owners back the plan. Council members also emphasized the messaging point that some enhanced services should begin before any rate change so owners and residents can “see the value” of higher fees.

What staff will do next: Finance and parking staff were asked to run a formal rate analysis, prepare the legally required fee reports and public-notice schedule, and return to council with ordinance language and a recommended implementation timeline. Rick Tatter, finance staff, explained that the public-notice and adoption schedule would require about 60 days of notice and that an adopted ordinance could take effect the following March, allowing an interim contract to start on one-time ParkFlag funding.

Other funding pieces discussed included moving select tourism/beautification dollars and restroom-contract funds into the downtown contract and amending the parking-district ordinance so parking revenues can be spent on district benefits as defined in the proposed IGA with FDBIRD.

Council did not take a formal vote; members asked staff to advance a detailed analysis and to consult closely with the downtown business association on outreach and messaging.

Ending: City staff said they would return to council with a detailed rate study, an amended IGA for FDBIRD if appropriate, and the public-notice schedule needed to begin a formal adoption process.