A planning effort by the Ann Arbor Downtown Development Authority, Connecting William Street, got an implicit expression of support from the city council at its Aug. 20, 2012 meeting, when it voted down a resolution directing the city administrator to proceed independently of that effort. [See also Chronicle coverage: "Planning Group Briefed on William Street Project"]
The resolution would have directed city administrator Steve Powers to evaluate the parcel at 350 S. Fifth for possible public or corporate use; and if none was found, to report back to the city council with a timeline for the disposition of the property – based on state and city laws and policies. That parcel is more commonly known as the Fifth and William parking lot (because it’s currently used as a surface parking lot in the city’s public parking system) or the Old Y Lot (because it’s the location of the former YMCA building).
The resolution’s sponsor, Stephen Kunselman (Ward 3), has frequently raised the issue of the ongoing interest payments associated with the loan used by the city to purchase the property from the YMCA for $3.5 million back in 2003. The council voted in 2008 to extend the five-year loan with the Bank of Ann Arbor for another five years, through the end of 2013. The interest rate is 3.89%. The interest-only payments work out to roughly $140,000 a year. By 2013, the total interest paid will be around $1.4 million. When it was condemned, the cost of demolishing the old YMCA building and abating asbestos was around $1.5 million. The DDA covered the demolition costs and has covered half the interest payments. So the total amount of Ann Arbor governmental investment in the property is at least $6.4 million.
Part of the reason the resolution did not generate enough traction on the city council to pass is that it stipulated that the city administrator’s efforts were to be independent of the DDA’s Connecting William Street planning effort, which includes the 350 S. Fifth parcel. It received support only from Kunselman, Mike Anglin (Ward 5) and Jane Lumm (Ward 2).
The Connecting William Street project was undertaken by the DDA based on a directive from the city council, on a unanimous vote, given at its April 4, 2011 meeting. Kunselman voted for that planning effort to take place – but was also vocal at the time, as well as before, about his view that the Old Y lot should simply be put up for sale one way or another.
This brief was filed from the city council’s chambers on the second floor of city hall, located at 301 E. Huron. A more detailed report will follow: [link]