Comments on: Feb. 18, 2014: Ann Arbor Council Preview it's like being there Tue, 16 Sep 2014 04:56:38 +0000 hourly 1 By: Donald Salberg Donald Salberg Mon, 17 Feb 2014 03:36:23 +0000 In response to the City Council agenda item regarding a possible purchase of the Edwards Brothers Malloy State Street property, I sent to each City Council member the following message:

I hope that you will be able to attend next Tuesday’s meeting which I understand will be the last opportunity for City Council to approve the purchase of the Edwards Brothers Malloy State Street property by the city.

I want to take this last gasp opportunity to further explain below my position which I expressed as a comment to Ryan Stanton’s February 10th article, entitled “Mayor cancels request for special meeting to discuss Edwards Brothers property.” [link]

Hopefully, the cancellation of the special meeting to consider the city’s purchase of the Edwards Brothers Malloy property on State Street means that the city will allow the University of Michigan to buy the property for its offering of $12.8 million which is four times the assessed valuation and, thus, twice the market value for the 16.8 acres.

City administrators and City Council members never told the public where the $12.8 million in city tax payer purchase money would be found within the city’s budget. As of the end of the last fiscal year on June 30th, 2013, the city had only $14 million in unrestricted funds in its general fund. Greatly depleting that fund to pay exorbitantly for land does not seem appropriate or wise. The city should not be in the business of real estate speculation.

A few City Council members were considering flipping the property although no other offers to purchase the property materialized since the property was first offered for sale in August. A few developers who have not been identified are purportedly interested in developing five acres of the land which borders on State Street. These potential purchasers are unlikely to pay twice the market value for pieces of the land. Therefore, tax payers will incur a loss of as much as fifty percent of its investment.

Furthermore, if the city buys the property and then offers it for development, developers will demand incentives that will cost city tax payers even more money. What incentives might be offered? The city could spend upwards of $10 million to construct a parking structure within a developer’s building as the DDA did for Village Green City Apartments. Perhaps, the city will install new utility services worth millions of dollars as I believe was done for Arbor Hills. Some of the 618 S. Main Street developer tax money will be used for street improvement where it fronts on Main Street. Packard Square and Arbor Hills have also received tax abatements based on Brownfield remediation which now covers site development broadly.

The argument that purchasing the property will keep it on the tax rolls is hollow since the closure of the printing facility on the Edwards Brothers Malloy property will have reduced the annual tax payment to far less than the $183,000 paid last year of which only $50,000 was received by the city. In fact without development the city would receive no taxes at all after purchasing the property.

The City Council and city administrators deserve credit for making a sound financial decision and sparing the tax payer losses if indeed the city does not purchase the land.

By: Vivienne Armentrout Vivienne Armentrout Sun, 16 Feb 2014 17:11:04 +0000 Re (5) It is odd that an AADL board member would propose developing the Library Lot to increase tax revenue. Surely she is aware that the AADL (as well as the City) would capture very little of that revenue. Most of it will go to the DDA. The AADL millage is included in the TIF collected by the DDA.

Ditto (6) on the CWS study. That study was notorious for refusing to consider open space uses for any of the downtown properties, despite much public interest in such a use for the Library Lot. Council ignored the CWS study with good reason. And applause for the consultant, Erin Perdu, for the excellent carry-through on the downtown zoning review.

By: Jack Eaton Jack Eaton Sun, 16 Feb 2014 16:51:32 +0000 Re: (5). Without getting into the discussion about the Edwards Brothers property, I agree with Ms. Leary that the City should seek to sell part of the site above the Fifth Avenue underground parking structure for development. On the other hand, I disagree that development of that site should rely on the Connecting Williams Street (CWS) study. It is time that we admit that the CWS study was a failure.

City Council passed a resolution asking the Downtown Development Authority (DDA) to engage in a process that would result in recommendations that could be included in the Downtown Master Plan. After an elaborate process, the DDA issued its CWS recommendations. Importantly, none (zero) of the CWS recommendations were included in the Downtown Master Plan. Even when grading on a curve, zero is a failing grade.

A good comparison is the downtown zoning review conducted by a consultant. After an elaborate public process, the consultant made recommendations. Those recommendations were approved and adopted by City Council.

The difference between the successful downtown zoning review process and the CWS process is that the consultant listened closely to what residents said they wanted and made recommendations that helped Council address the public’s concerns. Conversely, the DDA either ignored or refused to hear the concerns and desires the public expressed during the CWS study. It should come as no surprise that failing to incorporate the wishes of residents results in failure. The CWS recommendations were not incorporated into the Downtown Master Plan and should not be part of the discussion about our downtown planning.

By: Margaret Leary Margaret Leary Sun, 16 Feb 2014 15:57:49 +0000 RE: proposed purchase of Edwards Brothers property to maximize property tax revenue at some unknown future date. Why spend $20 million on that, when there is a ready-to-build on, much more valuable option: sell the development rights above the underground parking structure on 5th Ave. Council has the Connecting William Street report to guide it, and the site is more valuable than ever with the number of downtown residents growing. We’ve all paid for a strong structure to support a D1 building there. The whole point of that expense was to generate significant new tax revenue What’s the hold up?

By: Dave Askins Dave Askins Sat, 15 Feb 2014 00:00:18 +0000 RE: [3] The city purchases vehicles through a cooperative purchasing program through the state of Michigan. And Red Holman was the lowest responsible bidder.

By: bob elton bob elton Fri, 14 Feb 2014 23:28:27 +0000 When the city buys generic vehicles, such as the 2 vans for the parks department, how come they don’t buy them from a local dealer?

By: Dave Askins Dave Askins Fri, 14 Feb 2014 22:54:52 +0000 Re: [1] For the immediate term it would simply block the sale to UM. If you’re asking the city has identified a specific plan for the property right now (i.e., an alternate buyer and a strategy for private development) that it can rely on with high confidence to make the numbers work out for the short to medium term, I think the answer is: No. Or at least: Not yet.

By: John Q. John Q. Fri, 14 Feb 2014 22:24:25 +0000 Is the city’s action with Edwards Brothers simply to block the U from purchasing the property? Or is there some other plans for the property?