Steve Bean obtains nominating petitions as an independent candidate for mayor of the city of Ann Arbor. Behind the glass in the city clerk's office is Lyn Badalamenti. (Photos by the writer.)

It’s a five-minute session at the city clerk’s office.

This brief background piece covers some of the nuts and bolts of that process, based on Steve Bean’s Tuesday afternoon appearance on the second floor of city hall at the city clerk’s office. As a bonus, there’s a bit of city history thrown in.

After Bean told Lyn Badalamenti in the city clerk’s office that he was there to pick up nominating petitions, she set to work assembling a sheaf of papers. The spelling of Bean’s family name was the first order of business: “Like the vegetable,” he offered. Next up: A choice between “Steve” versus “Steven.”

The name that potential signatories of Bean’s petitions will see – as well as voters looking at November’s ballot – is “Steve.”

His name will be recognizable to some readers from his service on the city’s environmental commission. He now chairs that body. Before that, he served for nine years on the city’s energy commission. Some city records, especially older documents like city council minutes from April 9, 1992 – which contain the record of his appointment to the energy commission – show Bean’s name as “Steven.”

But the choice for the shortened variant was one he’d thought through before Badalamenti asked him: “That’s how people know me,” Bean explained to The Chronicle.

In the category of “the more things change,” those April 9, 1992 minutes indicate a discussion of over-exuberant University of Michigan basketball fans who apparently aroused concerns about public safety. They were celebrating the team’s advancement to the Final Four in the NCAA tournament. [The Wolverines lost in the final game that year to Duke University.]

In the category of “the more they stay the same,” the minutes indicate that one of Bean’s fellow energy commission appointees was Weston Vivian. Vivian, like Bean, goes by the shortened version of his name – that’s “Wes.” And Vivian spoke this past Monday to the city council during a public hearing on the Google Fiber initiative. Vivian told councilmembers that if Google doesn’t choose Ann Arbor as a location to install a fiber network, the city needs to figure out another way to make it happen.

Also in the category of things that stay the same are the petition requirements that Badalamenti handed to Bean as part of the sheaf of papers that all candidates receive. That packet includes:

• 400 lines worth of qualifying petitions – 20 pages with 20 lines apiece
• a sheet of rules for candidates who are circulating nominating petitions for city offices
• a message from Washtenaw County clerk Larry Kestenbaum, outlining the campaign finance reporting requirements
• the statement of organization form for candidate committees from the Michigan Department of the State Bureau of Elections
• the form for the post-election campaign finance compliance statement
• an affidavit of identity and receipt of filing

The qualifying petitions were copied with Bean’s name already filled in. That’s why Badalamenti needed it – to comply with the city charter requirement that petitions specify the person on whose behalf the petitions are to be circulated:

13.8 (b) Before the Clerk furnishes petition forms to any person, the Clerk shall enter thereon, in ink or by typewriter, the name of the person in whose behalf the petition is to be circulated and the name of the office for which the person is a candidate. No petition form which has been altered with respect to such entries shall be received by the Clerk for filing.

It’s not illegal to obtain and circulate petitions on behalf of someone else. But it’s not possible to place someone’s name on the ballot against their will:

13.10 (a) When petitions are filed by persons other than the person whose name appears as a candidate, they may be accepted for filing only when accompanied by the written consent of the person in whose behalf the petition was circulated.

Bean will need to collect at least 50 signatures from each of the city’s five wards for a total of at least 250. It’s not possible to engage in the intimidation tactic of collecting a number of petitions massively in excess of the minimum [emphasis added]:

13.8 (a) [...] Each petition filed by or on behalf of a person seeking nomination to the offices of Mayor shall be signed by not less than 250 nor more than 350 registered electors including at least 50 signatures of residents of each ward. [...]

The petition filing deadline for independent candidates like Bean – those without a party affiliation – is different from the deadline for candidates contesting one of the party’s primaries:

Act 116 168.590c Sec. 590c.
(1) A qualifying petition for an office shall be filed with the filing officer authorized to receive a partisan nominating petition or a certificate of nomination for that office.
(2) A qualifying petition for an office elected at the general November election shall be filed not later than 4 p.m. of the one hundred-tenth day before the general election. A qualifying petition for an official elected at an election other than the general November election shall be filed not later than the deadline established by statute or charter for filing a partisan petition or certificate of nomination for the office or at least 90 days before that election, whichever is later.

This year, 110 days before the Nov. 2, 2010 general election translates to July 15, 2010.

After filing petitions, it’s possible to change your mind and not have your name appear on the ballot. But it’s a narrow window:

(3) A candidate who files a qualifying petition shall not be permitted to withdraw his or her candidacy unless a written notice of withdrawal is filed with the filing officer who received the petition. The notice shall be filed not later than 4 p.m. of the third day after the last day for filing a qualifying petition.

For candidates contesting either the Republican or Democratic primary, the deadline for filing petitions is determined by the 12th Tuesday before the Aug. 3, 2010 primary – May 11 this year.

Finally, for citizens who are asked by prospective candidates for office to sign their nominating petitions, signing does not represent an obligation to vote for that person come election day. But there is a kind of obligation attached – signing nominating petitions for different candidates for the same office results in the disqualification of both signatures:

13.9 (b) If any person signs a greater number of petitions for any office than there will be persons elected to that office, that person’s signature shall be disregarded on all petitions for that office.

The city of Ann Arbor website has additional information on filing petitions for Ann Arbor city office on the city clerk’s page.

Steve Bean, 46, is vice president of Berg & Associates, Inc. He designs database management systems for Berg clients. Peter Schermerhorn will serve as Bean’s campaign treasurer.

Other agenda items receiving some discussion were the public hearing scheduled on the Google Fiber initiative, plus a contract revision for Recycle Ann Arbor to perform single-stream curbside recycling using automated carts.

Ban on Cell Phone Use While Driving

At its Feb. 16, 2010 meeting, the city council had given initial approval to a proposed city ordinance banning cell phone use while driving. That initial approval – at the ordinance’s first reading before the council– was followed by revisions to the ordinance that were numerous enough that it was presented again as a first reading at the council’s March 1, 2010 meeting. The council again gave the ordinance its preliminary stamp of approval.

On the agenda for Monday is the second reading of the ban on cell phone use while driving, together with a public hearing on the item.

But at the Sunday caucus, Sabra Briere (Ward 1) indicated that she’d heard from the ordinance’s sponsor, Stephen Rapundalo (Ward 2), that it would likely be postponed – more revisions had been undertaken to the ordinance language. Mayor John Hieftje confirmed that he’d heard similar news from Christopher Taylor (Ward 3).

Asked if this might mean a third presentation of the ordinance to the council as a “first reading,” Hiefjte allowed that it could mean that. He said he saw it as evidence that the process was working – the community was giving feedback on the proposed ordinance that was being incorporated into the language.

Asked if the council might consider – in lieu of passing a local ordinance – passing a resolution calling on the state legislature to take action on a cell phone ban, Hieftje allowed that this was a possibility. He also said that if the ordinance eventually failed to win council’s approval, that it would likely be based – for some councilmembers – on the fact that they see the issue as more appropriately addressed at the state level.

Briere, for her part, said she had a concern about the fact that the ordinance specified it was a primary offense – drivers could be pulled over for cell phone use specifically. Secondary offenses require some other additional reason for a driver to be pulled over. Resident Eppie Potts remarked that she figured if she were pulled over by the police, by the time the officer would approach the car she’d have put the cell phone down.

Resident Jack Eaton, who works as an attorney, indicated that he represented transit unions. Every transit union in the state, he said, has a rule against drivers using cell phones while driving. The difficulty, he said, is that enforcement becomes a he-said-she-said issue. How could a hands-free Bluetooth device be seen under long hair, for example?

Hieftje said he was concerned that when stopping motorists, looking for evidence of cell phone use was one more reason that police officers could use to look around in people’s cars.

Briere said she’d hate to think that we’d be sending police officers chasing after people using cell phones, while acknowledging that cell phone use is seen to be a genuine safety hazard by local traffic enforcement officers.

Briere elaborated on a statement from chief of police Barnett Jones, made at a recent city council meeting, that drivers using cell phones could currently be cited for careless driving, but that a cell phone ordinance would make things cleaner in a court of law. She said it would need to be shown that the cell phone was in use at the time of an accident, and that it would need to be demonstrated that such cell phone use caused the accident.

Mike Anglin (Ward 5) noted that the use of various hand-held electronic devices would only proliferate. He cited a demonstration of voice-activated commands for such devices that he’d witnessed as two tech people had squared off – one with a voice-activated smart phone and the other without – as they’d tried to find the answer to the question he’d posed: When was Budweiser founded? The guy with the voice-activated device was faster.

Google Fiber

The city council is holding a public hearing Monday evening on the city’s proposal that Google choose Ann Arbor as a site for installation of a fiber-to-the-home network. The council will be considering a resolution urging Google to select Ann Arbor as a site and promising “to take all lawful measures to expedite and accommodate the safe and efficient installation of the Google FTTH network.”

Though the Google Fiber network has been widely discussed as cost-free, the language of Google’s request for information (RFI) specifies that homeowners would be offered Internet service “at a competitive price” and this is reflected in the city council resolution.

Asked what they would consider to be a “competitive” price, Hieftje, Briere and Anglin required some time to noodle through what they currently paid to Comcast for their high-speed access, plus TV and phone. Consensus put that number between $60 and $100.

Asked how many residents of Ann Arbor they thought would be adopters of fiber and at what price, councilmembers were not sure. Hieftje said that Ann Arbor was one the most wired communities in the world.

Hieftje reported that he’d been included on a conference call with someone in the governor’s office the previous Friday in the wake of Gov. Jennifer Granholm’s trip to California to lobby Google to choose a Michigan city as a location for their fiber network. Based on his understanding from that phone call, he said, Google’s goal is to see the federal government take the lead on installation of fiber networks – their initiative would be a pilot to demonstrate how successful it could be. In Google’s view, said Hieftje, fiber optic access to the Internet should be like a utility.

On the question of competitive price, resident Jack Eaton speculated that the actual dollar amount would be comparable to Comcast, but that the Google fiber network would compete on quality and speed of service.

With respect to the service, Briere said she’d heard from constituents that they were already at the point of needing the kind of bandwidth that fiber offered (100-times faster than typical cable service), even if many people were not. She said in the next decade, she thought that video conferencing via fiber networks [an extremely high-bandwidth application] would play an increasing role.

On the question of neighborhood reaction to any hardware that might need to be installed external to houses, Briere offered her view that in light of the potential benefit, the aesthetic concerns could come later, not now.

Single-Stream Recycling

Late last year, the city made several decisions setting in motion a switch to single-stream curbside collection of recyclable materials from the current two-tote system – one for paper and the other for containers. The council heard a presentation at its Oct. 12, 2009 work session on the approach, which will include incentives for residents to set out their new single-stream carts for collection.

At their Nov. 5, 2009 meeting, the council authorized upgrades necessary for the materials recovery facility (MRF), and at their Dec. 21, 2009 meeting, they authorized the purchase of four new trucks plus 33,000 carts equipped with RFI (radio-frequency identification) chips.

At the Sunday caucus, resident Eppie Potts contended that most people didn’t know anything about the new single-stream system, and that when she told people about it they were shocked. She said that she did not want to dump the containers, which she rinsed out, on top of the paper she collected, out of concern that it would contaminate the paper. This was something the single-stream system would do anyway.

Potts wondered if the old recycling totes could be recycled. Hieftje said he would get an answer for her on that. From The Chronicle’s report of the council’s Nov. 5, 2009 meeting: “The new carts will be available in June/July 2010. The old totes can be recycled.”

Potts questioned the amount of public money spent on the project, which included, she said, $1.4 million for the carts, $1.2 million for trucks, and $3.2 million for upgrades to the facility.

Hieftje told Potts that the payback on the investment was estimated to be around six years and that money from the city’s solid waste millage had been set aside incrementally to be able to pay for those investments.

On the subject of the solid waste millage, resident Jack Eaton put the investment in single-stream recycling in the context of the cost-cutting measures for the solid waste fund being contemplated in this year’s budget planning. Those measures include elimination of curbside holiday tree pickup, as well as elimination of loose leaf collection. [Chronicle coverage: "Budget Round 4: Lights, Streets, Grass"]

The benefits of single-stream recycling, contended Eaton, would still be there when the time came, even if its implementation were delayed. He wondered if it might not have been wiser to delay that implementation.

Briere responded to Eaton by noting that the cost savings of eliminating the leaf collection and holiday tree pickup were relatively small. The question to ask about single-stream recycling, she said, was not just what it costs, but rather also what Ann Arbor gains.

On the solid waste millage, however, Eaton suggested that now, when the city is short of cash, the solid waste millage rate could be reduced, instead of investing in a single-stream system. Eaton suggested that with a reduction in the solid waste millage, the city could make a stronger case to voters that they should approve a Headlee override – which would restore property taxes to their original rates, before the Headlee amendment rolled them back.

Plans to build an addition behind the brick Zingerman's Deli building will ultimately require approval from the city's historic district commission. (Photos by the writer.)

Zingerman’s itself is “handling a complaint” from the city’s Historic District Commission (HDC) – one that can be traced back to a June 2008 Zingerman’s request to demolish two houses, which are located in the city’s Old Fourth Ward historic district.

Now Zingerman’s is bringing back another proposal, but this time they’re not starting formally with the HDC. Instead, they’ll begin by seeking approvals from the city’s planning commission and the city council.

The site plan calls for a two-story, 9,500-square-foot structure to be added to the rear of the deli building, which will carry a price tag of around $4 million. The new building would replace the house at 322 E. Kingsley St. and extend lengthwise towards Community High School.

Zingerman’s started satisfying the formal steps for getting approval of their expansion project this week, on Monday, March 8, by holding a citizens participation meeting.

But Zingerman’s has also met informally with the HDC at two separate work sessions since the start of the year – one in January and the other on Thursday, March 11. Based on a significant change in design between those two meetings, which integrates “the orange house” into the project instead of demolishing it, Zingerman’s is trying to “make it right” for the HDC.

Still, at Thursday’s HDC work session, the Zingerman’s team stressed how great the challenges were – financial and logistical – to preserving the orange house as part of the project design. It seemed apparent that Zingerman’s was making an implicit pitch for members of the HDC to give a green light for the previously proposed project – the one minus both houses.

It was clear enough, in any case, that Jill Thacher – the city planning department’s historic preservation specialist – finally said towards the end of the meeting: “We’ve been over that. I want to keep you from going back to that.”

Background: Certificates, Notices, Zoning Change

In June 2008, the first step Zingerman’s took with their project was to request permission to demolish the two houses from the city’s historic district commission. This time around, Zingerman’s will first seek approval from the city’s planning commission and city council, and then ask for approval from the historic district commission.

Understanding the reason for ordering things differently this time requires a clear understanding of the difference between two notions: (i) a certificate of appropriateness; and (ii) a notice to proceed.

It’s also useful to understand how the zoning code has changed for part of the land since June 2008.

Background:  Certificates of Appropriateness

The minutes from the historic district commission’s June 12, 2008 meeting show that the commission considered Zingerman’s application to demolish two houses – along with a garage – as an application for a certificate of appropriateness. This is one “flavor” of the kind of permission that the HDC can grant.

That application was brought before the HDC without a site plan or drawings to show what Zingerman’s planned to build there. What Zingerman’s had planned at that point was a 3-story new building, compared to the 2-story building that is now being proposed.

During the June 12, 2008 HDC public hearing on the matter, the lack of a presentation on their actual plans was a point on which  Zingerman’s drew criticism. Responding to that criticism, Ken Clein, an architect with Quinn Evans who is working on the project, explained the absence of a specific site plan. From the HDC minutes of that meeting:

Applicant Rebuttal: Mr. Clein – [...] the fact that they are not presenting plans or designs to replace these structures with. It was at the suggestion of staff that we separate that issue from the issue for request for demolition.

The issuance of a certificate of appropriateness for work in an historic district depends in part on whether the building in question is a “contributing” or  a “non-contributing” resource. A building that’s determined to be “non-contributing” is more easily altered than a building that’s “contributing,” under the Secretary of the Interior standards governing historic renovation.

A recent case of requested demolition in the Old West Side historic district – unrelated to Zingerman’s proposal in the Old Fourth Ward – highlighted the same issue of “contributing” versus “non-contributing” buildings. Permission to demolish two houses and a gas station on Second Street was sought by the developer of the Liberty Lofts project, to make it possible to construct additional parking spaces. He’d hoped that the potential for adding parking spaces would help attract a retail tenant for the still-vacant space in the greenhouse structure at First & Washington. [Chronicle coverage: "Demolition in Historic District?" and "Historic Commission: No Approval for Demolition"]

The HDC found the gas station – at the corner of Liberty & Second – to be non-contributing, but found the houses to be contributing. Commissioners voted to issue a certificate of appropriateness to demolish the garage, but wound up splitting 3-3 on all possible resolutions on the two houses.

Similarly, in June 2008 the HDC voted to issue a certificate of appropriateness for the demolition of the Zingerman’s non-contributing garage, but voted to deny the request to demolish the two houses, which commissioners found to be contributing to the Old Fourth Ward. While the HDC vote on the house at 420 Detroit St. was unanimously against demolition, the vote on the fire-damaged 322 E. Kingsley St. house was only 4-3 against demolition.

Background: Notices to Proceed

It seems impossible to reconcile Secretary of Interior standards for appropriate work in an historic district – one of which concerns “reversibility” of the work – with demolition of a building that the commission has determined to be a contributing resource.

However, another option to contemplate – a second “flavor” of permission – is that the HDC could issue a “notice to proceed.” The criteria for issuance of such a notice, from the city code, are as follows:

8:416. Notice to proceed.
(1) Work within a historic district shall be permitted through the issuance of a notice to proceed by the commission if any of the following conditions prevail and if the proposed work can be demonstrated by a finding of the commission to be necessary to substantially improve or correct any of the following conditions:
(a) The resource constitutes a hazard to the safety of the public or to the structure’s occupants.
(b) The resource is a deterrent to a major improvement program that will be of substantial benefit to the community and the applicant proposing the work has obtained all necessary planning and zoning approvals, financing, and environmental clearances.
(c) Retaining the resource will cause undue financial hardship to the owner when a governmental action, an act of God, or other events beyond the owner’s control created the hardship, and all feasible alternatives to eliminate the financial hardship, which may include offering the resource for sale at its fair market value or moving the resource to a vacant site within the historic district, have been attempted and exhausted by the owner.
(d) Retaining the resource is not in the interest of the majority of the community.

In the case of the recent request in the Old West Side for demolition, the Liberty Lofts developer argued that all of the criteria might apply, including (b). However, the commission – in consultation with the city attorney’s office – seemed ultimately to reject (b) as a possibility, citing the fact that the developer had no “planning and zoning approvals, financing, and environmental clearances” as required by (b).

And when Zingerman’s went before the HDC in June 2008, they also did not have planning commission or city council approval for the project.

With their current plan to obtain permissions from the planning commission and the city council first, before returning to the HDC, Zingerman’s would be in a position to make a case for alteration of contributing structures, based on criterion (b).

At the earlier public hearing in June 2008, Peter Pollack, a landscape architect who also lives near Zingerman’s Deli, laid out the case based on exactly that criterion. From the summary of Pollack’s remarks in the HDC minutes of that meeting:

[...] I ask you to put in context with the historic development of what has occurred on this property. Buildings have been  relocated, reoriented and adjusted. This is in the same spirit of that reorientation and adjustment. If you look at the “Notice to Proceed,’ this is a major deterrent to an  improvement program, and I say that this is exactly the case.

Background: Zoning

The Zingerman’s project that will be brought before the planning commission – probably in May – will be intended to meet all applicable zoning codes. That will make it a so-called “matter of right” project. That is possible due in part to a rezoning of the 322 E. Kingsley St. parcel, which took place last summer as part of the Ann Arbor Discovering Downtown (A2D2) rezoning project for all of downtown.

The previous zoning for 322 E. Kingsley St. was R4C, which is designated for residential, not commercial use. The new D2 zoning classification allows for various commercial uses, including restaurants and offices.

The rezoning of 322 Kingsley St. was given preliminary approval by the city council in April 2009 as part of a comprehensive rezoning of downtown Ann Arbor. That required review of the change by the planning commission, which ultimately approved it, in connection with its revision of the city’s downtown plan.

The 322 E. Kingsley St. rezoning was controversial for the planning commission, passing on a 4-3 vote. From The Chronicle’s report of the May 19, 2009 planning commission meeting, when the revision was approved.

During the public hearing, the  planning commission heard from several speakers who objected to the assignment of the D2 designation to the property, on the grounds of  “fairness” and “favoritism” – everyone loves Zingerman’s, themselves included, they said. But that didn’t translate into changing the zoning, just because Zingerman’s asked for it.

They also heard from representatives of Zingerman’s about why the D2 zoning was requested, as well as from a speaker who noted that he’d just witnessed two hours of “serious participation” by citizens who were engaged, and had been properly noticed, and concluded that the notion of fairness had not been violated.

The vote on the commission was 4-3 for following council’s lead in assigning D2 zoning to the parcel. Voting for the D2 designation were: Eric Mahler, Tony Derezinski, Jean Carlberg, and Wendy Woods. Voting against it were: Bonnie Bona, Kirk Westphal, and Ethel Potts. Mahler, responding to an argument made by Peter Pollack at the previous week’s work session, said that the option of pursuing a PUD for a particular project (as an alternative to having the D2 zoning) would, in his opinion, be difficult. For a PUD, Mahler said, a public benefit would have to be demonstrated – and from what he could tell, the kind of project Zingerman’s was contemplating would most likely be for Zingerman’s benefit.

Westphal did not cite “fairness” in voting against the D2 designation, but rather a respect for the long, extended process of community participation that had extended over a few years – none of which had included discussion of the 322 E. Kingsley parcel.

Background: Timeline Overview

• June 12, 2008: Historic district commission denies request for demolition of 322 E. Kingsley St. and 420 Detroit St. [Rocco Disderide's former residence, aka "the orange house."]
• Feb. 19, 2009: Planning commission adopts downtown plan with various revisions but no change to existing R4C zoning of 322 E. Kingsley St.
• April 6, 2009: City council gives initial approval to zoning revisions to downtown requiring alterations to the downtown plan adopted by the planning commission; major alterations include changes in South University area, but also included a rezoning of 322 E. Kingsley St. from R4C to the new D2 classification. The amendment on 322 E. Kingsley St. is introduced by Sandi Smith (Ward 1) and passes with dissent only from Sabra Briere (Ward 1). [link]
• May 19, 2009: Planning commission approves revisions to the downtown plan to accommodate part of the city council’s South University zoning revisions, an East Huron zoning revision, and the 322 E. Kingsley St. revision. [link]
• June 15, 2009: City council adopts downtown plan as revised by the planning commission. [link]
• Nov. 16, 2009: City council gives final approval to downtown zoning revisions, including the D2 designation to 322 E. Kingsley St.
• Jan. 14, 2010: At an HDC work session, Zingerman’s presents plan showing demolition of two houses.
• March 8, 2010: Zingerman’s holds a public participation open house on its proposed expansion.
• March 11, 2010: At an HDC work session, Zingerman’s presents a plan showing demolition of one house only.

Zingerman’s Expansion: January 2010 HDC Work Session

The city’s historic district commission typically conducts its work sessions just after its regular meetings conclude – in the city council workroom, which adjoins the council chambers where the commission holds its regular meetings.

At the Jan. 14, 2010 HDC work session, Ken Clein of Quinn Evans Architects was joined by Gary Bruder, Zingerman’s legal counsel, and Nancy Rucker, who works in Zingerman’s Deli operations.

Clein presented the project with conceptual drawings and a study model – which at that time showed the removal of both the 322 E. Kingsley St. house and the 420 Detroit St. house.

Clein explained that the proposal to expand was related to an interest in preserving the original historic deli building. The current cooking and dishwashing operations in the building, he explained, generated moisture that escaped through the exterior brick, and caused deterioration of the wall. The evidence of the toll that it takes, he said, can be seen on the exterior of the wall facing Kingsley in the form of efflorescence – white salt deposits.

Clein also outlined a number of challenges associated with the Zingerman’s campus, one of them the seven-inch elevation change, which has an impact on what’s required to meet ADA accessibility standards, as well as the tight quarters, which has an impact on where stormwater detention can be undertaken.

The key issue for commissioners, naturally, was the question of removing both houses. Generally, commissioners did not seem wed to the idea of preserving the 322 E. Kingsley St. house.

[The June 2008 vote on that house had been close: 4-3 against demolition. One of the votes against demolition was Michael Bruner, who has since been replaced on the HDC with Patrick McCauley. McCauley's comments at the work session suggest he could be supportive of removing the 322 E. Kingsley St. house.]

On the 420 Detroit St. house, however, McCauley was unambiguous: “I’ll just come out and say it. I don’t think you should tear that house down.”

What McCauley pointed to was the fact that the proposed new building seemed to impinge on just one corner of the house, and for that reason, he did not think the condition was met that the removal of the house be “necessary.”

Clein countered by saying that there was more to it than just the small corner of the house. Among the specific issues he enumerated were: the impact on accessibility and the need to construct ramps; plus proximity of the house to the new structure triggering a requirement of fire-proof sheathing, which added to the expense; and the need to temporarily move the house to accommodate the actual construction of the new building.

Key for Clein was the idea that if cost were no object, then anything was possible – but it was a matter of how much cost was reasonable to ask of someone in order to rehabilitate an historic property.

On the question of expense, commissioner Diane Giannola wondered what the cut-off was for rehabilitation being “too expensive.” She allowed that it was “something to think about.” On the cost question, McCauley contended that it was only a small part of the overall project budget. Clein countered that in ballpark numbers, the rehabilitation of the house would likely be $0.5 million out of a project budget of $3.5 million to $4 million – or 1/7 of the budget, which he did not consider to be a small part of it.

Giannola raised the question of whether the 420 Detroit St. house could be seen from the street, to which McCauley responded: “You can totally see it from the street!” Giannola maintained that it was not a part of the streetscape, but noted that it was still a part of going to Zingerman’s Deli.

On the topic of location, Jill Thacher, the city planning department’s specialist in historic preservation, addressed the topic of the house’s history. It had been moved from the corner where the brick deli building now stands, she said, but that was during the district’s period of significance. This meant the fact that it had been moved was not an argument that it wasn’t a contributing structure. “Let me get the ‘it’s been moved’ argument off the table,” she said. [The same issue had been discussed fairly thoroughly at the HDC's June 2008 meeting.]

Commissioners discussed how far the notion of “necessity” in the criteria for a notice to proceed extended – was it “necessary” that Zingerman’s undertake the expansion at that location?

Commissioner Ellen Ramsburgh wondered if the expansion was more than the site could take. She noted that the Zingerman’s Creamery and Bake House had moved to peripheral locations. “Do you need to be there?”

In her remarks, Ramsburgh was echoing sentiments expressed by then-commissioner Michael Bruner back in June 2008, when he had made the suggestion that Zingerman’s think of moving their operations. The specific location he had in mind was the Old West Side structure adjoining the Liberty Lofts development:

Commissioner Bruner – [...] This may be less than what they need, but there stands today, a project that we reviewed and was approved, a development that includes a 20,000 square foot commercial retail area with parking that is begging to be occupied. [An apparent allusion to the Liberty Lofts greenhouse building.] As preservationists that want to encourage the success of economic projects in the city, perhaps Zingerman’s should consider moving their location as they have with their Creamery, which is at a satellite location, their Bakery which is at a satellite location, their Roadhouse that is a satellite location – this could be relocated as a satellite component at another location, nevertheless retaining this location as it is.

Clein responded to Ramsburgh at the January 2010 HDC working session by wondering if there were another historic district in another town where Zingerman’s could contemplate locating their operations. Ramsburgh: “That’s a threat!”

Zingerman’s Expansion: March Public Meeting, HDC Work Session

At the open house event held on March 8 to introduce the new project to the public, a key difference in the plan was apparent, made since the January HDC work session: The 420 Detroit St. house – “the orange house” –  is now incorporated into the design, both in the drawings and the study model.

HDC work session, March 11, 2010. From the far end of the table, at right, going clockwise: Paul Saginaw, Lori Saginaw, Lesa Rozmarek, Kristina Glusac, Diane Giannola, Ellen Ramsburgh, Nancy Rucker, Gary Bruder, Bill Kinley, Deb Cooper, Ken Clein, Jill Thacher, Patrick McCauley, Rick Strutz, Grace Singleton.

At the open house, Ray Detter, president of the city’s downtown citizen’s advisory council, responded to a mention that the plan now included “the orange house” with the clarification: “You mean the Disderide house?”

Rocco Disderide was the proprietor of a grocery in the brick deli building, who moved the house from the corner to make way for that building.

Detter had told the board of the Downtown Development Authority at their last meeting, on March 3, 2010, that the advisory council was concerned about Zingerman’s plan to expand:

Zingerman’s plan generated “heated discussion” at DCAC, said Detter. The deli is located in the Old Fourth Ward historic district. He said they agreed that Zingerman’s is an essential part of the community, but that they needed to make sure there’s not a precedent set that would undermine planning. The decision needed to be oriented around the city’s planning documents: the downtown plan, the central area plan, and the historic district.

At the March 11, 2010 HDC work session, Ken Clein mentioned that some of the attendees of their March 8 open house were puzzled as to why they were keeping the 420 Detroit St. house as a part of the design.

As a designer and an architect, Clein said, he did have some concern for the judgment of history – would people look back 50 or 100 years from now and wonder why that house was incorporated into the design? “Will they look back and say, ‘What the …? Stupid preservationists!’” Patrick McCauley joked in response: “They’re going to say that anyway!”

At the March 8 open house, Paul Saginaw, a founding partner of Zingerman's, is not explaining how he fought his way through the curds, swimming to the surface after falling into a vat of cheese. He's explaining to a neighbor how the Zingerman's project is going to look.

The question of how much the preservation of the 420 Detroit St. house would cost arose again, just as it had at the January work session. In the interim, some more concrete numbers had been attached to the cost of rehabilitating the house for integration into the design. The house is shown in the design to be attached to the building at the rear via a glass connector.

Bill Kinley, who owns Phoenix Contractors Inc., was at the work session on Zingerman’s behalf to provide comment on some of the construction costs. McCauley was skeptical of the costs shown for electrical upgrades to the structure, citing some familiarity with the cost of a complete electrical replacement of a house. Kinley pointed out that there’s a rule of thumb for residential rewiring of $30-$35 per opening (switch plate or plug) versus a $120-$140 rule of thumb for work to bring things up to commercial code.

The code requirements that the 420 Detroit St. house would need to meet are commercial standards.

Clein reported that the kind of work that would be necessary, and which Zingerman’s had now had estimated in more detail, included a rebuild of the foundation, new floor framing for the first floor, new joist hangers for the second floor and the addition of exterior sheathing. [The house is built with the balloon-frame construction technique.]

The additional cost of the project attributable to the rehabilitation of the 420 Detroit St. house would be between $600,000-$750,000. In terms of cost per square foot, Clein said, it came out to $572/sq. ft.  By comparison, the new construction cost of a laboratory building at the University of Michigan – the Biomedical Sciences Research Building – was $100/sq. ft. less, at $480/sq. ft., Clein said. Kinley added that the new construction of a recent project that Phoenix had completed – the Towsley Children’s Center at Forest & Willard – came in at only $300/sq. ft.

Commissioners pointed to the importance of retaining the spatial relationships between the 420 Detroit St. house and the other buildings in the compound. At their regular meeting just before the work session, they’d turned down a request to add a second story to a 1-story garage, partly on the basis of those spatial relationships.

Picking up on this need to preserve the spatial relationships, Kinley suggested that they could simply rebuild the 420 Detroit St. house anew and replace it with new construction that would have the same shape and massing of the old house. Clein pointed out to the commissioners that with all of the work that would be required on the house to bring it up to code, there would likely be little of the original “fabric” of the house remaining.

Commissioners seemed cool to the implicit pitch that the Zingerman’s team was making to go back to a scenario where both houses would be demolished. Said Jill Thacher: “We’ve been over that. I want to keep you from going back to that.”

Commissioners also took care to stress that they were really happy with the proposal that removed the 322 E. Kingsley St. house but integrated the 420 Detroit St. house into the design, characterizing it as a good compromise. “I really like this,” said McCauley, allowing that he had been “the most strident person about the preservation of the orange house.”

On the fact that Zingerman’s had taken their feedback and incorporated it into their new proposal, McCauley summed it the contrast between the HDC’s experience with some applicants: “This is much preferable to getting yelled at.”

The current schedule calls for the proposal to come before the city’s planning commission in May. In the meantime, the Zingerman’s team will meet with the city’s building inspector on code issues related to the 420 Detroit St. house.

A rough study model of the area as it currently stands. The view is from the north. Detroit Street runs from front to back. Kingsley runs left and right. The Zingerman's Deli brick building is on the corner of Detroit and Kingsley.

A study model of the Zingerman's expansion viewed from Detroit Street, looking east. The finger is pointing at the screening for mechanicals on the roof of the proposed new building.

The Zingerman's Deli building viewed from Detroit Street. The 420 Detroit St. property is the orange house to the right of the brick deli building.

Nancy Rucker and Gary Bruder with the Zingerman's team at the January 2010 HDC working session.

City planner Jill Thacher and Rick Strutz, a partner in Zingerman's Deli, inspect the current study model at the March 11 HDC work session. In the backround is Grace Singleton, another Zingerman's Deli partner.

Efflorescence on the spawled brick of the Zingerman's Deli building on the wall facing Kingsley Street.

Sue McCormick, the city's public services area administrator, showed the city council a map of streetlights during Monday's meeting. (Photo by the writer.)

On Monday, Sue McCormick, public services area administrator, was front and center, describing for council how the public services budget “lives within the general fund.” The basis for the discussion was budget impact sheets prepared for the public services area, which she distributed.

Councilmembers had several questions for her about a possible special assessment district (SAD) to fund streetlighting, with much of the discussion centered around what it means for an area to be “overlit.” A streetlighting SAD would require property owners to pay for streetlights.

Also generating a fair amount of discussion among councilmembers was the $100,000 annual cost for traffic control on University of Michigan football game days and the city’s plan to reduce that cost through judicious rescheduling of personnel to avoid overtime expenses.

McCormick also pitched to the council the idea of relaxing the constraints of the “box” defining how the parks maintenance and capital improvements millage is administered. The proposal would have the council rescind the part of a previous resolution that requires millage funding for natural area preservation to increase by 3% every year. That savings, McCormick said, could be put towards hand-trimming of grass in the parks. Reduction of hand-trimming, she said, would have a negative visual impact on the parks – they’ll look “fuzzy.”

Also related to yard-waste type issues, McCormick briefed the council on the idea of eliminating collection of loose leaves in the fall, and moving to an approach requiring leaves to be put into containers. She also told them about  a proposal that would be coming before them in the next 30 days to transition the city’s composting facility to a merchant operation, similar to the city’s materials recovery facility (MRF) for recyclables. That proposal was met with strong criticism from Stephen Kunselman (Ward 3).

Councilmembers also heard from McCormick that residents will face a 3.88% increase in water rates, unless council directs that more budget cuts be made.

Towards the end of the meeting, city administrator Roger Fraser warned that accounting services manager Karen Lancaster and chief financial officer Tom Crawford would put them to sleep with an explication of how the city’s municipal service charge (MSC) works. However, Lancaster and Crawford were unable to make good on Fraser’s threat.

Streetlights and Parking

Sue McCormick, the city’s public services area administrator, began by establishing that the main challenge in the field operations area was coming up with a way to replace anticipated revenues from  parking meters – which were to have been installed over the last year in neighborhoods near downtown. Their installation had been part of the FY 2010-11 budget plan (the current year), but was met with opposition from residents in those neighborhoods.

Parking Meters

After adoption of the FY 2010 budget in the spring of 2009, Sandi Smith (Ward 1) convinced her council colleagues to establish a moratorium on the parking meter installation. With support from Sabra Briere (Ward 1), Carsten Hohnke (Ward 5), and Mike Anglin (Ward 5), Smith worked to find additional revenues to offset the losses that would result from not installing meters as planned near certain neighborhoods downtown. A timeline overview:

• June 15, 2009: The city council approves a moratorium until Oct. 5, 2009 on installation of some parking meters in neighborhoods near downtown. The meter installation was planned as a part of the FY 2010 budget. The council also approves raising the rates at the 415 W. Washington parking lot, with all net proceeds to be directed to the city’s general fund, not split with the Downtown Development Authority. [link]
• July 1, 2009: The DDA board approves a rate increase and the redirection of 415 W. Washington parking revenues to the city. [link]
• Oct. 5, 2009: The city council extends the moratorium on installation of parking meters until Dec. 21, 2009. [link]
• Dec. 21, 2009: The city council passes a resolution suspending plans to install its own city meters in connection with a request from the DDA for a report on parking strategies. Part of the resolution is approval to redirect net revenues from the Fifth & William parking lot (aka the old Y lot) to the city. [link]
• Jan. 6, 2010: The DDA board approves redirection of the net revenues from the Fifth & William lot to the city, with the provision that it be a minimum of $100,000. [link]

On Monday, McCormick painted a grim parking picture for the council. A 7.5% targeted reduction in the $1,327,102 field operations budget – a percentage every service unit was asked to achieve by the city administrator  –  translated to $99,533. Without the $551,733 in revenue that had been planned, based on parking meter installation, field operations was starting with a $651,266 deficit it needed to make up.

Sandi Smith (Ward 1) zeroed in on the fact that the additional revenue from the two parking lots – 415 W. Washington and Fifth & William – did not seem to be included in the calculation. [It's about $170,00 per year for the two lots combined.] McCormick deferred the question, but CFO Tom Crawford would later clarify that the revenue from the two lots was not yet incorporated into the budget – it would be, he assured Smith.

Smith also wondered where the offset for the procurement costs of parking equipment was recorded. McCormick told Smith that it was included in this year’s FY 2010 budget, not FY 2011.

Smith noted that residential parking permit fees were slated to increase by $5 – to $55. That does not cover the cost of administering the program, which is over $100 per permit. Smith noted that the going rate for a parking spot behind someone’s house is $75 a month, so she felt that there was some untapped value in the residential parking permits. Smith allowed that a residential permit for street parking did not provide a specific space for a driver’s use, but she felt there was more value than what the city was charging.

On residential permits, McCormick explained that she’d worked with three councilmembers to arrive at a $105 cost, a longer-term goal for the rate, which would be achieved through incremental adjustments.

With respect to some new loading zone permits – which are listed in the budget impact statement as projected to increase revenue by $20,000 – Stephen Kunselman (Ward 3) wondered if meters might be more effective. McCormick said she was working with the DDA on that question – one of the challenges is the variable size of the vehicles, which could take up anywhere from one to three spaces.

Streetlights: Background

As it turns out, the added $170,000 of revenue to the city from the 415 W. Washington and Fifth & William parking lots would just about cover the field operations deficit to its reduction target ($158,286) – after implementing a streetlighting assessment district (SAD) that targeted just those areas of the city that are “overlit.”

The idea of implementing a SAD for streetlights was floated at the council’s December 2009 budget retreat, and McCormick’s discussion on Monday was a follow-up to that. But it’s not a new idea.

As recently as 2007, the idea of a street lighting special assessment district has been proposed. On that occasion, the Ann Arbor DDA paid the city about $630,000 to delay and reduce a street light tax that would have been assessed on downtown property owners. That tax would have generated around $170,000 annually. The DDA money was used to begin an LED retrofit program for downtown streetlights.

From the June 6, 2007 DDA resolution:

…
Whereas, DDA approval of this Committee recommendation would provide the necessary funds so that a downtown special assessment would not be necessary; RESOLVED, The DDA approves a grant to the City’s Energy Fund in the amount of $630,000 to the City of Ann Arbor to be used to retrofit all downtown globe streetlights with more energy efficient LED fixtures.
RESOLVED, In providing this grant the DDA respectfully asks City Council to consider dissolving the downtown lighting assessment district given the energy cost reduction the City will see from this retrofit project.

Sandi Smith (Ward 1) alluded to that episode on Monday when mayor John Hieftje reported that some of the more sophisticated energy-savings technologies available with the LED bulbs – like dimming them to 50% or 20% – did not actually result in cost-savings to the city. DTE bills the city based on the wattage of the bulbs – it’s based on estimated usage, because the lights are not metered. “[Bulb dimming] works just fine, but we wouldn’t get credit for it,” said Hieftje.

Smith, who serves on the DDA board currently and who served on it when the LED conversion funding was approved, called the inability of the city to translate the full energy-savings capability of the LED bulbs into cost savings as “unfortunate.” The rationale behind the DDA funding was to avoid the establishment of a SAD, she noted. She asked McCormick if there would be additional pressure applied at the state level through the Michigan Public Service Commission to push for reform. McCormick assured Smith that there would be additional pressure applied.

According to Michigan Public Service Commission spokeswoman Judy Palnau, the MPSC issued an order on Jan. 11, 2010 that required DTE to file an application with MPSC seeking approval of rates on un-metered streetlights that would accommodate newer lighting technologies. The deadline for submission was Feb. 10, 2010. However, the issue of these LED rates is still pending at the MPSC.

Some savings is realized through LED retrofits, due to the reduced frequency of bulb replacement – 7-8 years compared to every 3 years.

Streetlights: How a SAD Would Be Implemented

McCormick mentioned more than once at Monday’s meeting that a SAD would require four council resolutions to be implemented. The Chronicle has identified three resolutions in the city’s ordinances, plus one in the city charter:

• Code Chapter 13 1:286 “By resolution the city council shall approve the plans and specifications for the improvement; determine that the cost shall be paid by special assessment upon the property especially benefited; designate the district or land and tax parcels upon which special assessments shall be levied; and direct the Assessor to prepare a special assessment roll in accordance with the city council’s determination.”
• Code Chapter 13 1:288 “… Upon receipt of a special assessment roll the City Council shall order it and the information presented to the City Council by the City Administrator pursuant to Section 1:284 filed in the office of the City Assessor for public examination; shall fix the time and place when it will meet and review the roll.”
• Code Chapter 13 1:191 “After the hearing and review, the council may confirm the special assessment roll with the corrections as it may have made, if any, …”
• Charter SECTION 10.3 “No control or expenditure … shall be made for any public improvement, the cost of which is to be paid by special assessment upon the property especially benefited thereby, until the Council has passed a resolution determining to proceed with such public improvement.”

Streetlights: What Kind of SAD?

McCormick briefed the council on five different options for creating a special assessment district for streetlights. Based on the budget impact statements, which mention only two of the five options, one that appears unlikely to be implemented is to purchase streetlights from DTE and install LED bulbs. DTE owns around 5,200 of the 7,200 streetlights in the city. DTE has told the city that they would need to be paid to develop estimates for the work of selling and removing lights from their system.

Also not included in the budget impact statement is a SAD targeting just the city-owned streetlights. The third option not included in the statement is one that would not create a SAD, but would rather  “de-energize” DTE-owned streetlights – which would entail turning off power to the light. DTE bills those de-energized lights at a rate equal to 60% of the standard rate. De-energizing half of the 3,000 DTE-owned streetlights outside of downtown would save $120,000 annually.

The two options included on the budget impact statements for field operations are: (Option I) a SAD targeting areas in the city that are “overlit” – this would generate $370,000 annually; (Option II) a SAD for all streetlight expenses – it would generate $1.7 million at an average cost per parcel of $52 annually.

Streetlights: Overlighting

The notion of “overlighting” prompted a great deal of discussion among councilmembers. Part of the confusion resulted from the term itself, which is suggestive that “too much” lighting is being provided – on analogy with scores of other words like overbill, overreact, overeducate, overemphasize, overgeneralize or … overanalyze.

Based on that understanding, Margie Teall (Ward 4) and Marcia Higgins (Ward 4) questioned why more lighting was currently being added in an area that was already “overlit,” namely, the Stadium Boulevard corridor between Pauline and 7th streets. The 24 cobra-head lights in that corridor, which a map provided by McCormick indicated was currently “overlit,” is being supplemented by 67 LED lampposts.

McCormick explained that this was driven by input from the community – the neighbors had opted for more lighting at public forums on the Stadium Boulevard re-surfacing project. Higgins responded by saying that she’d attended those meetings and that no one had asked for 67 additional light fixtures. She pointed out that the issue was somewhat urgent, given that the corridor is under construction.

McCormick characterized the issue of “overlighting” as a good policy question that the council needed to contemplate: Should the city “overlight” in any area where it was requested, or rather only in those areas where a SAD was established?

Carsten Hohnke (Ward 5) elicited from Cresson Slotten, who’s a senior project manager with the city, the fact that the “Orange Book” with the city’s lighting specifications has been in place for 23 years, and was developed by the city. That is, it’s not a set of state or national standards. Hohnke stated that it would  be useful to look at comparable standards in other communities to get a clearer idea of what “overlighting” means.

City administrator Roger Fraser then tackled the question of what “overlighting” means. He cautioned councilmembers that just because the amount of lighting in an area was over the minimum Orange Book standard did not mean that the amount of lighting was “excessive.” An area might be lit so that it becomes a comfortable place to be and a place that people are attracted to. Even if an area is “overlit,” he said, it still might be smart to light it that way. The notion of “overlighting,” Fraser said, should be interpreted in the context of the minimum standard specified in the Orange Book.

To get an idea of how an overlighting-based SAD would work, Sabra Briere (Ward 1) asked McCormick if the following would be a fair summary: If people in an area wanted additional lighting above the minimum standard, the city will say “It’ll cost more,” and that area will be a SAD. McCormick confirmed that this would be roughly how it would work. She cautioned, however, that it would not be like ordering out of a catalog.

Stephen Rapundalo (Ward 2) noted that many overlit areas were close to schools, and that “it should be that way.” He said a SAD was a way of “demanding payment,” which he quickly revised to “requesting payment.”

McCormick stated that the cost of operating streetlights – around $1.7 million – was significant enough that the city needed to “do something.”

Fraser characterized it as a matter of some parts of the community getting a higher benefit from lighting than others. The issue of whether the city should change to a SAD strategy to reflect that different benefit was a policy question. He noted that part of the consideration was how to deal with a situation that was in part simply “inherited.”

Reflecting out loud on the fact that the term “overlighting” was somewhat of a misnomer and that streetlighting is a public benefit that is somewhat flexible – there are various interests with respect to more or less lighting – Christopher Taylor (Ward 3) wondered if it were an option to make the assessment based on “what exists.” That was essentially the first option outlined in the cover memo, McCormick told him. [Note that Option I in the budget impact statement is the overlighting-based SAD. The cover memo's first option shows up as Option II in the budget impact statement.]

Streets

Public services includes not just streetlighting, but also the streets themselves.

The city divides streets into categories of major and local streets. That’s consistent with the way that money in the Michigan Transportation Fund (MTF) is distributed to municipalities. The MTF was established by Act 51, and its monies are collected as motor fuel taxes and vehicle registration fees. The city’s major street fund [Fund 0021] and local streets fund [Fund 0022] are projected in FY 2011 to have budgets of $7 million and $1.75 million, respectively.

The MTF money is used for snow plowing, pothole repair, crack sealing and the like. Actual reconstruction of streets is paid for out of the city’s street repair and reconstruction millage.

With respect to activity in these funds, results of a recent unscientific online survey administered by Sabra Briere (Ward 1) showed that around 55% of the more than 700 respondents felt a reduction in snow plowing was “not at all unacceptable not at all acceptable.” [.pdf file of survey summary results]

Streets: Non-Motorized Transportation

Act 51 requires that 1% of MTF funds distributed to municipalities be invested in non-motorized facilities. On May 19, 2003, in approving the city’s FY 2004 budget, the Ann Arbor city council passed an amendment that bumped Ann Arbor’s expenditures of Act 51 money on non-motorized facilities from 1% to 5% every year, targeting an increase in the number of bicycle lanes, focusing particularly on areas near the University of Michigan campus. Any of the 5% not spent in a given year was to be deposited in an alternative transportation fund.

In deliberations on that budget amendment, which addressed not just that fiscal year’s budget, but all future years, then-councilmember Mike Reid offered an amendment that specified the 5% allocation would extend just for 10 years. The amendment received support only from Marcia Higgins (Ward 4). Reid was then the lone dissenter on that amendment to the budget.

The timeframe was likely a moot point – budget resolutions must be approved every year, so there is a “baked in” opportunity for the council to reassess the 5%. If anything, the 2003 budget amendment was a direction to the city administrator to prepare budgets incorporating the 5% allocation to non-motorized facilities. Whether the council approves that aspect of the budget in any given year is not constrained by the council’s own prior budget resolution for FY 2004.

If a budget were presented without that 5% allocation, the council could choose to approve it, contrary to the expressed intent of the FY 2004 budget resolution.

Based on the budget impact statements for next year, FY 2011, that seems to be what happened for FY 2010. The impact sheets indicate a reduction from 5% to 2.5% in the Act 51 allocation to alternative transportation for FY 2010, with the same 2.5% reduction planned for FY 2011.

Stephen Rapundalo (Ward 2) raised the issue of reducing the Act 51 allocation to alternative transportation at the council’s December 2009 budget retreat. However, when the council met in late February for its third meeting of the year focused just on budget issues, when mayor John Hieftje read the item off the list, the topic had no takers.

With the Act 51 line item laid out in front of them on the budget impact statements provided at Monday’s meeting, councilmembers did not discuss the issue.

Streets: Traffic Control for UM Football

An item on the budget impact sheets that did receive a great deal of discussion on Monday was a $101,043 cost savings that could be achieved by eliminating traffic control for University of Michigan football games. Part of that game-day operation involves converting Sout Main Street to one-way leading out of town and providing manual control of traffic signals to accommodate pedestrian build-ups. The signals are also manually controlled to prevent vehicles at the I-94 off-ramp at Ann Arbor-Saline road from backing up onto the interstate.

McCormick noted that simply not implementing the traffic controls would make chief of police Barnett Jones “pull his hair out.” The alternative to that, she said, was to use a strategy to avoid overtime pay for the nine people required to handle the signs and signals on a football Saturday. The idea would be to schedule only two of them on the Monday before, leaving the rest with a Tues.-Sat. work week with no overtime.

The scheduling shift, said McCormick, would save around $45,000. Craig Hupy, head of systems planning for the city, clarified for Marcia Higgins (Ward 4), that the signals could, in fact, be controlled from a remote location by one person, but that tactic would not give the needed ability to change the signals based on the needs of the dynamically changing situation. Sandi Smith (Ward 1) asked for confirmation from Hupy that failure to implement traffic controls would mean “a real mess.” Hupy replied by saying that if the council gave that direction, then he had some vacation days he would like to use.

Stephen Rapundalo (Ward 2) inquired about the possibility that the University of Michigan would foot the bill for traffic controls: Had they been asked? Hupy said that UM had said no. Higgins suggested that if the city did not implement the controls, UM would hear from its alumni about that. McCormick said that the university’s rationale was that the benefits to the community that derive from the event compensate for the cost.

Christopher Taylor (Ward 3) asked how much of it was an issue of convenience versus public safety.  Chief of police Barnett Jones stated that it was all safety-related. Without the combination of cars, barricades and signals, he said, “it would be a major malfunction.”

Although it was not discussed at the work session, a recent (unscientific) survey administered online by Sabra Briere (Ward 1) included one football Saturday-related item: Of the more than 700 respondents, 90% found a reduction of investigation in underage drinking on football Saturdays to be either “completely acceptable” or “somewhat acceptable.” [.pdf file of survey summary results]

Parks Maintenance

The parks maintenance and capital improvements millage was authorized in November 2006. It combined what had previously been two separate millages. Sue McCormick described the various constraints built into the administration of the millage as a “box.” She ticked through the sides of the box in a way that was consistent with previous Chronicle coverage ["Budget Round 2: What's the Big Idea"]:

Before November 2006, the city levied two separate millages at 0.5 mill each – one for parks maintenance and the other for capital improvements. Within the combined millage, taxes are collected at a rate of 1.0 mill, but money is allocated to maintenance or capital improvements on a more flexible basis than the previous 50-50 split that was legally enforced by the specialized purpose of each millage.

However, there’s not complete flexibility to allocate money to maintenance or capital improvements within the unified millage. Percentage allocation is guided by a city council resolution passed in October 2006. The resolution specifies a range of 60% to 80% for maintenance, with the remainder going to capital improvements.

But there are some “hold harmless” clauses in the resolution as well. The resolution also calls for any reduction in the overall general fund to be reflected no more severely in parks programs supported by the general fund than in other general fund activities. For example, if the general fund were to suffer a 7.5% reduction, then parks programs supported by the general fund would suffer no greater a reduction than 7.5%.

Subsequent to the passage of the millage, in preparation of the FY 2007 budget, the city initially calculated the baseline for general fund parks activity without the Leslie Science and Nature Center – which had been spun off by the city as an independent nonprofit. The reasoning was that the item itself was no longer in the general fund, so it was not a matter of the general fund being reduced. However, in response to public criticism, funding was put back into parks programs to bring funding to the level it would have been with the Leslie Science and Nature Center as a part of the calculation.

Another “hold harmless” clause in the resolution on the administration of the parks maintenance and capital improvements millage affects the city’s natural area preservation program (NAP).

3. The Natural Area Preservation Program budget be established at a minimum of $700,000 for first year of the millage budget and that it receive a minimum 3% annual increase for each of the subsequent five years of the millage to enhance the stewardship of increased acreage of natural park areas;

It’s likely that the clause was intended to ensure that funding for NAP kept pace with funding increases to other areas, as millage revenues increased due to increased property values. But the effect of the clause now, as millage revenues decline, is to hold NAP harmless – and even to increase NAP’s budget.

The distribution of funds to various park-related tasks – which is specified in Attachment A accompanying the resolution – includes the stipulation that mowing and snow removal for parks be funded exclusively out of the general fund. The millage fund, then, is “held harmless” against mowing and snow removal costs.

At Monday’s meeting, McCormick stated that staff had pushed the allowed ratio to its maximum allocation for maintenance – 80%. The 20% designated for capital improvements, McCormick said, was focused exclusively on rehabbing existing facilities, not building anything new – refurbishing paths, for example.

Asked by Stephen Rapundalo (Ward 2) what the bill for mowing and snow removal was for parks, McCormick gave figures of $1.25 million and $355,000, respectively.

The part of the “box” McCormick recommended that the council consider was the requirement that NAP’s allocation be increased every year by 3%. The specific recommendation was to reduce NAP’s budget by $81,000.

McCormick explained that the $81,000 could be put towards hand-trimming of grass in the parks. The rationale she offered involved the planned reduction in frequency for mowing in the parks. This spring the average frequency will drop from once every 14 days to once every 19 days, she said. And with the start of the fiscal year on July 1, 2010, that would drop again to once every 23 days. “The public will visually notice the difference,” McCormick said.

It’s the reduction in hand-trimming that becomes apparent most quickly, she said. “Things get fuzzy.”  So the $81,000 of NAP money would restore some of the hand-trimming.

Results of a recent unscientific online survey administered by Sabra Briere (Ward 1) showed that around 20% of more than 700 respondents would find reduction in park maintenance to be “completely acceptable” and an additional 55% would find it to be “somewhat acceptable” [.pdf file of survey summary results]

Grass and Leaves

Trimming of grass and the generation of other yard waste was a topic that arose also in a residential context.

McCormick began by noting that the solid waste millage sees the same kind of reduction in revenues that other property taxes are now showing, due to the overall reduction in property values associated with the down economy. McCormick said that the reduction in the solid waste budget would be around $450,000.

The solid waste millage can be enacted by the city council under state enabling legislation – it appears as “CITY REFUSE” on Ann Arbor property tax bills.

Leaf Collection

Among the ideas recorded on the budget impact statements is the elimination of the collection of loose leaves in the fall. The current leaf collection program organized by the city entails notifying residents of the day their neighborhood is scheduled for pickup and asking them to rake leaves into the street the day before they’re scheduled for pickup.

The budget impact sheets indicate a $104,000 savings would come from eliminating the loose leaf collection program in favor of collecting them as part of the city’s containerized yard waste collection program. Residents can either put their yard waste in paper bags or use a city-issued brown cart, which can be emptied via an automatic arm operated by a driver from inside the collection truck.

The amount of savings that would come from requiring containers for leaves, said McCormick, assumes that residents would put out the same volume of leaves as they do with the loose leaf collection program. But she expected that the actual volume would decrease – for some residents it would be somewhat easier to compost and mulch on site than to put their leaves in containers for pickup.

Christmas Trees

McCormick also indicated that eliminating the curbside Christmas tree pickup would save $28,500. Results of a recent unscientific online survey administered by Sabra Briere (Ward 1) showed that around 85% of more than 700 respondents would find the elimination of that service to be “completely acceptable” or “somewhat acceptable.”

At Monday’s meeting, Briere asked where residents could take their holiday trees for pickup. McCormick said they could talk about that. The city has a drop-off station, and another possibility was to establish locations in parks, where the trees could then be chipped right in the park.

Conversion to Merchant Composting Operations

McCormick’s budget impact statement for solid waste also indicates a net gain of $150,000 for the possible transfer of the city’s composting facility to a merchant operation. That gain was due to a one-time capital recovery for the sale of equipment to the successful bidder on the request for proposals (RFP). The city’s RFP for the composting operations indicates that the equipment would include items like front-end loaders, light-duty trucks, and tub grinders.

Tony Deresinski (Ward 2) inquired about any implications for the city’s labor agreement. McCormick told him there were two full-time positions at the city that would be lost – a mechanic and a supervisor – but that the city had held vacancies open for them in other parts of the organization.

Sabra Briere (Ward 1) wondered what would happen if the city contracted with a merchant, then elected to decide against that contractor based on performance and then opt for a different contractor. McCormick indicated that the city had received four strong responses to the RFP.

Stephen Kunselman (Ward 3) was clear about his opposition to the the proposed conversion to merchant operations: “I’m really opposed to this,” he said. At the second round of budget talks he had already expressed skepticism about the idea.

Kunselman’s opposition is based in part on an inherent skepticism about the viability of yard waste compost as a commodity, along the lines of recyclable material. [The city uses a merchant operation for its materials recovery facility.] Because it’s not a commodity that can be reliably sold in large quantities, said Kunselman, the city would essentially be providing the merchant with tax-free land to store compostable material, until it could eventually be moved on the market. He said he did not imagine that they would be able to sell the material in 50-pound bags at Lowes.

Kunselman’s opposition is also based on the idea that there’s a built-in assumption that the merchant operation will accept yard waste from other surrounding communities – even while the city is trying to encourage its own residents to “keep it home” and reduce the amount of yard waste that is hauled from one place to another. [The elimination of the loose leaf collection program is one example.] Conversion to merchant operations, he said, was a way of subsidizing yard waste collection for surrounding suburban communities. Promoting the idea of trucking and hauling yard waste, Kunselman said, is “going in the wrong direction.”

Kunselman also noted that the composting facility was located in the southeast part of the city – his ward – and he did not want to see additional truck traffic on the roads in that part of town.

In response to Kunselman, McCormick indicated that the council would be receiving the merchant operation proposal in the next 30 days.

McCormick also told the council that the subject of privatization of residential trash collection would would be one for the following year’s FY 2012 budget, not this coming year.

Water

The budget impact statements for the water supply system show a decrease in revenue of $1 million, for a $22.5 million budget. The drop is due to a decrease in consumption of water, plus a decrease in connection charges that are applied to new construction. In FY 2009, there was only $100,000 collected in such connection charges, McCormick said, whereas an average year might bring in $1.5 million.

The decrease in revenues due to decreased consumption, McCormick explained, was partly offset by a decrease in costs for treatment of the water.

Still, without additional cuts beyond purchase delays of heavy equipment and elimination of software updates indicated on the budget impact statements, McCormick said a rate increase of  3.88% could be expected.

Marcia Higgins (Ward 4) clarified with McCormick that the 3.88% increase in water rates would be requested, if no other cuts were made. McCormick told Higgins that if the council wanted to see a smaller increase, then she needed direction sooner rather than later.

Municipal Service Charge

The water fund provided a question from Stephen Kunselman that segued to the presentation from accounting services manager Karen Lancaster and chief financial officer Tom Crawford on how the municipal service charge (MSC) works.

Why, asked Kunselman, did the MSC for the water fund drop from roughly the same levels of $535,548 in FY 2008 and $548,940 in FY 2009 down to $404,902 in FY 2010?

Similarly, he wondered, why did the solid waste fund’s MSC increase from roughly the same levels of $192,588 in FY 2008 and $197,400 in FY 2009 to $274,851 in FY 2010?

MSC: True Cost Concept

It’s worth distinguishing between the idea behind the municipal service charge compared to an internal service fund charge, like the charge for information technology (IT). Charges from the IT department to other funds are based on specific purchases and use of services – a new computer, with software and support services, installed at a desk, for example.

Calculation of an MSC is not an attempt to bill for products and services, but rather an attempt to distribute the burden of “administrative and overhead” costs to those parts of the city’s operations that cause the existence of those costs.

For example, take the city council, which could be considered a parade example of an administrative and overhead cost. The city council and mayor are paid a salary, which is an expense that is a direct dollar cost to the city. But what about the additional costs the council drives that are not necessarily reflected in a dollar amount in a city checkbook?

Those costs will probably vary, depending on the people who serve on council at any given time. An active city council that is constantly asking the city attorney’s office for analysis and feedback on various ordinance revisions causes more work for the city attorney’s office. The city attorney does not bill the city council for that work. But if the goal is to measure the true cost of the city council to the organization, then the cost of that work needs to be factored in.

Last year, for FY 2010, the city council’s “true cost” was calculated to be an additional $284,711 beyond the salaries of councilmembers. So the MSC listed out in last year’s “budget book” is $284,711. The bulk of that additional cost – $204,000 worth – was attributed to work done by the city attorney.

This “true cost” calculation does not attempt to accommodate various ways in which city councilmembers might conceivably save the organization money – by helping staff to identify more efficient ways to provide service, or by handling a constituent concern without burdening city staff.

Once the “true cost” of an entity like the city council is determined – along with various other administrative and overhead-type costs that are borne inside the city’s general fund – it’s then possible to consider the city’s departments that live outside the general fund. How do departments that exist outside the general fund benefit from the existence of those centralized administrative services supported by the general fund?

Take the water fund as an example. The city’s water department benefits from the centralized payroll services of the city and the city attorney’s office in ways that are fairly clear. It even benefits from the city council. For example, the water rate increases that will be requested this year will need to be weighed, considered and approved by the city council.

There is a lag in the calculations, because the calculations are based on actual costs. A study is performed every two years by an outside consultant – the city uses a firm called Maximus – which corresponds to the city’s two-year budget planning cycle. For the first year of a budget planning cycle, the city uses the numbers from the consultant’s study. For the second year, the city applies an inflationary adjustment of 2-3%.

MSC: Water and Solid Waste

Here’s a breakdown of the calculation for the way the water fund and the solid waste fund were charged the “true cost” of centralized administrative services in FY 2008, and how it was budgeted in FY 2010. The numbers in the columns correspond to the consultant’s report on FY 2006 – used for the FY 2008 budget – and the consultant’s report on FY 2008 – used for the FY 2010 budget.

Water Fund
                              Actual  Budget
                             FY 2008 FY 2010
Building Depreciation              0       0
Equipment Depreciation             0       0
Mayor & Council               34,658  49,185
City Administrator            50,738  49,972
Facility Management                0       0
Human Resources               99,621 110,353
Procurement                        0       0
City Attorney                137,866  47,754
City Clerk                    21,858  42,129
Finance Administration        29,426  48,054
Accounting                    99,837 103,819
Assessor                           0       0
Treasurer                      7,465  10,137
Non-Department Expenses        5,437   8,386
Community Development              0       0
Public Svcs Redistribution       318     543
Public Svcs Gen Fund Retiree       0       0
Parks & Recreation Admin           0       0
Parks & Rec Gen Fund Retiree       0       0
Community Svcs                     0       0
Building Dept Redistribution       0       0
Utilities Redistribution      30,666  30,078
Customer Service Call Center       0       0
Environmental Coordinator     17,661       0
Total Allocated              535,551 404,902 

=====

Solid Waste Fund
                              Actual  Budget
                             FY 2008 FY 2010
Building Depreciation            361       0
Equipment Depreciation             0       0
Mayor & Council               17,688  33,957
City Administrator            25,177  27,921
Facility Management                0       0
Human Resources               62,154  68,406
Procurement                    3,208   7,353
City Attorney                 16,415  11,951
City Clerk                    11,155  29,094
Finance Administration        15,019  33,186
Accounting                    33,340  50,378
Assessor                           0       0
Treasurer                      4,879   7,717
Non-Department Expenses        2,986   4,856
Community Development              0       0
Public Svcs Redistribution         0      22
Public Svcs Gen Fund Retiree       0       0
Parks & Recreation Admin           0       0
Parks & Rec Gen Fund Retiree       0       0
Community Svcs                     0       0
Building Dept Redistribution       0       0
Utilities Redistribution           0       0
Customer Service Call Center       0       0
Environmental Coordinator          0       0
Total Allocated              192,589 274,851

-

So Kunselman’s question about the differences in the MSC for these funds can be given the first part of an answer by looking at this breakdown. For the water fund, the decrease in MSC can be attributed primarily to an increase decrease in the amount attributed to the city attorney: a drop from $137,866 to $47,754.

For the solid waste fund, there are increases across several services, perhaps most notably the doubling of the amounts attributed to the city council and to finance administration.

MSC: Why Do It?

At Monday’s council meeting on the budget, Karen Lancaster stressed that the idea behind the MSC was about cost recovery to the general fund. In FY 2008, the total amount of administrative and overhead costs identified in the general fund budget for FY 2010 and FY 2011 – the current two-year cycle – was about $12 million.

Out of that $12 million, around 75% of it goes to support general fund activities. So it’s only a little over $3 million that is recovered to the general fund from outside the general fund.

Other funds besides the general fund get their revenue in various ways. Some funds, like the solid waste fund, have their own dedicated millage. Other funds, like the water fund, get their revenues from fees.  For funds that are fee-based, it’s reasonable to want the rates that are charged to be an accurate reflection of the true cost of providing the product. The idea is that rates should be high enough so that consumers of city water are paying an accurate price for the water they use, without an administrative subsidy from the general fund.

To the extent that a consumer of city water is also a property taxpayer to the general fund, there might be a reasonable expectation that delivery of water is a core city service. That is, the property taxes that someone already pays – and has no way to influence up or down through one’s day-to-day behavior – could be expected to pay for administration and overhead costs of the water fund, so that property tax payers can enjoy a slightly reduced rate for their water.

On the other side, not all consumers of city water support the general fund through property taxes.

In FY 2009, the University of Michigan used – and paid for – about $7.3 million in water and sewer services from the city. But UM does not pay property taxes. Without an MSC that allows the general fund to recover the cost of administration, general fund property tax payers would, in effect, be subsidizing a part of UM’s water bill.

Three of nine parks and recreation commission members for Washtenaw County, who attended Tuesday's meeting. Front to back: Jimmie Maggard, Patricia Scribner and Robert Marans. Obscured is Bob Tetens, director of Washtenaw County Parks and Recreation. (Photos by the writer.)

The county’s parks and recreation program is funded by two separate, dedicated countywide tax levies at 0.25 mill apiece – for capital improvements and maintenance, respectively. The millages are separate from the county’s general operating millage.

The offer of matching funds came with the clear expectation from commissioners at the meeting that the county will be given its due – in terms of signage and participation in the project as it moves forward.

Bob Tetens, director of Washtenaw County Parks and Recreation, spoke at the meeting about the ability of the county to leverage the fundraising efforts of AASAC to achieve an $800,000 skatepark, instead of a $400,000 skatepark. For AASAC’s part, the plan all along was to build an $800,000 skatepark – plus establish a $200,000 endowment for maintenance.

The promised funds from the county will allow AASAC to leverage the match as part of their fundraising efforts. From that point of view, the timing of the county’s decision worked out to AASAC’s advantage. This Saturday, March 13, from noon-6 p.m. Red Belly Boardshop will sponsor The Grinds of March, a benefit for the Ann Arbor Skatepark fund to be held in a warehouse located at 704 Airport Blvd.

The Grinds will feature a pro skating demonstration by Garold Vallie and Andy MacDonald. MacDonald spent his summers in Ann Arbor, growing up skating.

The city of Ann Arbor has so far not offered dollars in support of the skatepark, but has approved use of the site, and struck a memorandum of understanding with AASAC. Ten out of 11 councilmembers also signed a letter dated March 8, 2010, urging the county’s parks and recreation commission to support the skatepark.

County Parks Commission Deliberations on the Skatepark

Discussion of the skatepark item was moved up as the first item for discussion after public commentary, from its original spot under “New Business.” That move meant that AASAC steering committee members Trevor Staples and Jim Reische did not have to wait through three reports, plus five items worth of old business for the commission to deliberate on the skatepark funding.

Bob Tetens, director of Washtenaw County Parks and Recreation, led off discussion by noting that the skatepark committee had contacted the commission numerous times and that Staples and Reische had appeared before the commission at its January 2010 meeting and made a presentation. At the staff level, Tetens said, the skatepark proposal had been considered for over a year and a half.

In October 2009, Tetens was not yet ready to advocate for funding the skatepark [Chronicle coverage: "Skatepark Rolls Towards Design"]:

At this point, Tetens explained, “We don’t have the numbers … We don’t know what ‘it’ is – a $200,000 park or a $2 million park.” Once you have a conceptual design, he said, you have a project you can talk about.

On Tuesday evening, Tetens pointed out that development of the skatepark had progressed beyond the conceptual design phase. [Skatepark designer Wally Hollyday held a design charette on Oct. 18, 2009.] Tetens also noted that the Skatepark Action Committee was well on its way to achieving 501(c)3 nonprofit status.

He observed that the skatepark enjoyed overwhelming support in the community and that the proposed site was situated on a bus route.

Deliberations: Veterans Memorial Park Site

With respect to the siting along a bus route, commissioner Janice Anschuetz noted that previously the commission had talked about building a skatepark out at Rolling Hills, a county park on North Territorial Road. What made the proposed Veterans Memorial Park location better, she said, was that a kid from Ypsilanti would be able to get on a bus and ride it to the skatepark.

Conan Smith – who serves on the parks and recreation commission as a representative of the county board, along with Rolland Sizemore Jr. – declared that he was excited by the skatepark, because it was in his neck of the woods. [Smith represents District 10 in Ann Arbor.] He observed that if you’ve ever had a drink at Knight’s, you might be familiar with the corner of Maple and Dexter-Ann Arbor, where the park is planned. With a stellar park [Veterans Memorial Park] at its heart, Smith said, it would drive mixed-use and mixed-income development in the area.

Deliberations: The County Gets Its Due

One concern shared by commissioners was that the county be appropriately recognized for its role in supporting the skatepark. Rolland Sizemore Jr. wondered: “Do we have any input, or is it Ann Arbor and skateboard people?” Trevor Staples assured Sizemore that up to now there’d been a three-way partnership between the Ann Arbor Skatepark Action Committee, the city of Ann Arbor, and the Ann Arbor Area Community Foundation, but that they wanted to negotiate the participation of a fourth member. “We want it to be a partnership,” concluded Staples.

Commissioner Jimmie Maggard agreed that the county should have “someone on board.”

Sizemore moved an amendment to the resolution, which was accepted as friendly, that stipulated the county’s participation as the project moved forward. After the vote, he suggested that Conan Smith take the position representing the county on the project, but Smith said that county parks planner Jeff Dehring might be a better choice – he was open to discussion on that.

Janice Anschuetz also wanted to make sure the county was recognized, and that it was clear that the skatepark was not just for Ann Arbor – signage at the park would help with that, she said.

Commission chair Robert Marans declared that it would be a countywide facility before calling for the vote, which was unanimous.

Though he supported the resolution, Stephen Solowczuk noted that he’d wished for a bit more forewarning. He noted that a $600,000 allocation for a segment of the Border-to-Border Trail near Dexter meant that they’d be allocating $1 million in one night – they couldn’t have too many nights like that, he warned.

Deliberations: Ann Arbor Support

Commissioners noted the importance of the letter of support that the Ann Arbor city council had sent them, along with a copy of the resolution that the council had passed on Dec. 1, 2008, which approved a memorandum of understanding between the city and the Skatepark Action Committtee. In that resolution, noted Bob Tetens, the “shelf-life” on the city’s land allocation for the skatepark at Veterans Memorial requires that construction begin no later than Jan. 1, 2014.

The letter from city councilmembers mentioned by Tetens and others was dated March 8, 2010. It was forwarded electronically by city administrator Roger Fraser to the county’s parks and recreation commission. In Fraser’s email message, he stated that commissioners would receive a physical copy of the councilmembers’ letter. The electronic version indicates that it will be signed by all councilmembers except for Marcia Higgins (Ward 4). In addition, there’s a space for Scott Rosencrans, who chairs the city’s park advisory commission, to sign the letter. [.txt file of cover letter from Fraser and letter text by councilmembers]

Board Deliberations: Fundraising

During deliberations, commission chair Robert Marans asked how the skatepark advocates planned to raise their $400,000. Jim Reische, fundraising co-chair for AASAC, told the commission he felt that the matching funds would allow them to pursue gifts in the 5-6 figure range – he based that on conversations with prospective donors. He also cited a tremendous grassroots effort, now centered on a social networking fundraising site called crowdrise. [That site indicates $20,000 now raised out of the $1 million goal.]

Reische also told the commission about the Grinds of March fundraiser on Saturday. The revelation that Andy MacDonald would be skating was met with a “You’ve got to be kidding” from Anschuetz.

Grinds of March

Over the last weekend in February, The Chronicle documented photographically some of the ramp construction activity at 704 Airport Blvd. in a warehouse where the Skatepark Action Committee has built up a wooden skateboard ramp for the Grinds of March fundraiser on March 13. [After turning west onto Airport Boulevard off State Street, look north for the large "704" numbering.]

Retired Zingerman's posters will be for sale at the Grinds of March fundraiser.

Steve Risner jams a board into place with a backhand whack.

The ribs or the bones of the ramp are called "templates."

Teamwork was key in assembling the ramp.

Tony C. trims a board to fit. The taller section of the ramp was an extension to the original design.

You build it, then you can skate it.

Local coffee roaster John Roos took a tentative turn on the ramp. Roos, who sells his Roos Roast coffees at the Ann Arbor Farmers Market and other locations, has developed a Skatepark Blend to support the ramp.

Gregg Iddings gets ready to drop in as John Roos looks on. Iddings, a probate court judge in Adrian, is a member of the Skatepark Action steering committee

In the two weeks between ramp construction and the Grinds of March fundraiser, volunteers with the Skatepark Action Committee have been taking advantage of the ramp. The ramp itself will be auctioned off after the event.

Not his first time on a board.

The DDA board talked about more than just the budget. Who was that map man? As the nameplate says, it's DDA board member Keith Orr, who was introducing a draft of a bicycle map that the DDA is working on. (Photos by the writer).

Deliberations covered a range of issues. First, the budget needs to accommodate two major DDA capital projects: the underground parking garage currently under construction; and the Fifth Avenue and Division Street improvements, which are also underway.

Second, there’s a contingency written into the budget for $2 million. The contingency is there in case renegotiation of the parking agreement between the city and the DDA results in a continuation of the $2 million payments made by the DDA to the city for each of the last five years. Continuation of the payments is not legally required under terms of the current agreement, which assigns responsibility for administration of the city’s parking system to the DDA through 2015.

Third, the fund balances of the DDA – which reflect the DDA’s reserves – face a dramatic reduction. That’s an issue that city of Ann Arbor CFO Tom Crawford flagged back in the spring of 2009 during discussions about the construction of the underground parking garage. The concern caused the city council to scale back the size of the garage by 100 parking spaces.

And finally, decisions made by the DDA board over the last year have resulted in re-direction of revenues from two surface parking lots – 415 W. Washington and the old YMCA lot at Fifth and William – to the city of Ann Arbor. That has resulted in the elimination of line items for DDA programs for next year that were in this year’s budget.

Besides the budget, the board also discussed a number of other topics, including development of the Library Lot and results from two parking surveys.

We begin with background on the four funds that make up the DDA budget, and a discussion of reserve levels.

DDA Budget: The Four Funds

The DDA’s budget is divided into four funds: TIF (tax-increment finance), housing, parking, and parking maintenance.

DDA Budget: TIF Fund

Desposits to the TIF fund come from property taxes collected within the DDA district. It’s a tax-increment finance (TIF) district, which means that property taxes are collected on the difference between the baseline value of a property when the district was established and the value of a property after improvements. The Ann Arbor DDA TIF “capture” is on the value of the improvements at the point they are made, and does not include subsequent increases in property value due purely to market forces.

To illustrate how TIF works, consider a property that has a taxable value of $100,000 to start. Suppose the owner builds on the property so that its taxable value is $1,000,000. That $900,000 increment is the amount on which the DDA’s tax capture is based. Now suppose the property adds value at $10,000 a year for 10 years due to ordinary real estate market conditions. So after a decade, it has a taxable value of $1,100,000. Each year, the Ann Arbor DDA’s tax capture is based on the same $900,000. So in the 10th year, the basis of the DDA’s tax capture would not include the first $100,000 or the $100,000 by which the property had increased over the years.

DDA Budget: Housing Fund

The housing fund gets its deposits through transfers from the TIF fund. It was created in 1997, and historically the amount of the annual transfer has been $200,000. At the board’s February 2010 meeting, Sandi Smith summarized activity in the housing fund over the last decade:

Smith reported that in the last 10 years, 23 grants had been awarded and that the average amount of those grants had been around $80,000. Of the 23 grants, 11 had gone to one nonprofit – Avalon Housing. A total of $1.1 million from the housing fund had been obligated, Smith said. The breakdown of those dollars: (i) $400,000 for Village Green’s City Apartments project at First & Washington, contingent on issuance of a certificate of occupancy; (ii) $207,000 for the third year of a grant to Avalon; and (iii) $400,000 to $500,000 for Near North.

The Village Green project Smith mentioned in that summary is a planned unit development (PUD) proposal by Village Green Residential Properties LLC at the corner of First and Washington, across from the Blind Pig, which includes 156 dwelling units and 244 public parking spaces. The city council approved the project on Dec. 1, 2008.

At its May 18, 2009 meeting, the council authorized an extension of terms in order to give Village Green more time to arrange financing. From the cover memo accompanying the resolution:

In order to complete this project the Developer has requested an extension of the term of the Option Agreement until December 30, 2009. Staff recommends approving this extension plus authorization for two three-month extensions at the City Administrator’s discretion. We expect this amendment to provide the developer sufficient time to complete their financing arrangements and close on the sale of the property.

The extension is now covered under the first of the three-month extensions that can be made at the city administrator’s discretion. The city has already factored $3 million of proceeds from the land sale into its financing plan for the new municipal center under construction at Fifth and Huron.

If the City Apartments project were not to go forward, the $400,000 in the DDA housing fund that’s committed to the the project would be freed up, along with the projected $9 million it would take to build the parking deck component of the project.

DDA Budget: Parking Fund

The parking fund gets its deposits from the city’s parking system, which the DDA administers under an agreement with the city. The agreement was revised most recently in 2005, extending 10 years, through 2015. The DDA contracts out the management of the system to Republic Parking. The terms of the city-DDA agreement on parking provide for a $1 million payment by the DDA to the city per year, including an option for the city to ask for up to $2 million in any given year – with the condition that the total amount of payments through 10 years not exceed $10 million.

Rob Aldridge, who was a DDA board member in 2005 when the parking agreement was struck, raised a concern about the possibility that the city would ask for $2 million in each of the first five years of the agreement. From the board minutes of the March 2, 2005 meeting:

Mr. Aldrich asked if it would be possible for the City to draw the full $10 million in the first 5 years; Mr. Solo said yes. Mr. Aldrich asked what would happen in year six, which is to say, would the City be satisfied to receive no further rent for the remaining five years. There was no response to this question.

As it turns out, the city asked for and received $2 million from the DDA for the first five years covered by the agreement. The current status of the negotiations between the city and the DDA to revise the parking agreement has been an ongoing topic for the last year at DDA board meetings, and factored significantly into deliberations on the DDA budget on Wednesday.

DDA Budget: Parking Maintenance Fund

The parking maintenance fund gets its deposits through transfers from the parking fund. The amount of those deposits per year is based on an inspection of the parking structures by an engineering firm, which estimates required maintenance over the next 20 years. That includes fixing rips in protective coatings, and repair of cracks to prevent seepage.

DDA Budget: Fund Balances (Reserves)

The DDA’s 2010-11 budget shows total fund balances dropping from $8,865,473 at the start of the year to $3,414,486 by the end. At Wednesday’s meeting, Roger Hewitt, who chairs the operations committee, attributed the bulk of the drop to down payments on two major capital projects: the underground parking garage at the Library Lot site, and the Fifth and Division streetscape improvements, which are both now underway.

In the 2010-11 budget, those expenditures are listed under “capital costs” in the amount of $2,796,507 from the parking fund and $2,020,753 from the TIF fund.

The DDA 10-year plan forecasts reserve levels dropping to their lowest point of $1,130,000 in the 2012-13 budget year, which is 5.65% of annual recurring expenses. After that, they’re projected to increase, as the new parking spaces being built start to generate revenue and rate increases begin to take effect.

The appropriate level of reserves for the DDA budget was a topic that drove city council discussion when the underground parking garage was approved last year, and ultimately led to the elimination of 100 spaces from the design.

From the Feb. 17, 2009 Ann Arbor city council meeting:

Crawford reported that on looking at the DDA’s financial picture, he noticed that they don’t have a minimum reserve policy. He said he generally used 15-20% as a minimum reserve. In light of the need to maintain adequate reserves, he said that in his view the project is “not affordable with the plans they have.”

The proposed structure would occupy area under Fifth Avenue. But [councilmember Carsten] Hohnke expressed concern that the cost of an extension along Fifth Avenue southward past the southern edge of the library lot all the way to William Street (part of the current plans) didn’t offer commensurate value for the investment. He was concerned that the cost would constrain the DDA in making other needed investments. He said that while there’s no doubt more space is required, he thought that the roughly 770 spaces to be built exceeded what’s required.

Hohnke then proposed an amendment that would slightly reduce the scope of the project, by whittling around 100 spaces off the total through eliminating the Fifth Avenue extension all the way to William Street. Even the reduced number of spaces would represent roughly a 10% increase in the 5,000 spaces currently in the city’s off-street parking inventory, Hohnke said.

Queried by Mayor John Hieftje, Hohnke said that cost savings of removing the 100 spaces would be around $6 million.

At the time, DDA board members were reluctant to accept Crawford’s assessment of appropriate reserve levels – reasoning in part that the city itself had no set policy specifying a reserve amount at that level. From The Chronicle’s coverage of the DDA board’s March 4, 2009 meeting:

[DDA board member, Leah] Gunn recounted how at council’s Feb. 17 meeting Tom Crawford, Ann Arbor’s chief financial officer, had expressed concern about the DDA’s fund balances. She said that the city of Ann Arbor had no policy on fund balances and that she thought the DDA’s finances were perfectly healthy.

However, on the fund balance issue, then-councilmember Leigh Greden wrote in an email sent on March 7, 2009 to Susan Pollay, executive director of the DDA, as well as to DDA board members Jennifer S. Hall and Leah Gunn:

I understand there has been some discussion at the DDA that the City does not have a minimum reserve policy similar to the one Tom Crawford has been recommending for the DDA. In fact, the City DOES have a minimum reserve policy, and has had such a policy – in writing – for years. The policy has been printed in the City’s Budget for years, and reads as follows:

The City shall “maintain an undesignated General Fund balance with a minimum range of 8% to 12%; provided that when necessary use of these funds occurs, subsequent budgets will be planned for additions to fund balance to maintain this standard over a rolling five-year average.”

Tom Crawford has repeatedly urged the City to exceed this policy by maintaining an undesignated General Fund reserve of 15%. Consistent with Tom’s recommendations, the City has exceeded our policy by maintaining an undesignated General Fund reserve of 15-20%. The existence of this policy and our success in exceeding the policy is one of the reasons that TWO ratings agencies upgraded the City’s bond ratings in late 2008. These higher bond ratings result in lower interest rates for bonds issued for City projects – including DDA projects. This is the background for Tom Crawford’s request that the DDA adopt a similar policy requiring a fund balance of 15%.

The policy that Greden cited is No. 7 on a list of 10 short-term financial goals in the city’s FY 2010 budget book.

Budget Discussion

With that background, then, here’s how the budget deliberations unfolded. The topic was broached first during public commentary.

Budget Discussion: Public Comment

Brad Mikus addressed the board about the proposed 2010-11 budget and noted several concerns that led him to conclude that “it’s a tight budget.” Among those concerns was a budgeted total revenue of over $16 million for the parking system, when revenues over the last 12 months had been only $14 million. In addition, Mikus pointed out that the budget relied on an increase in tax-increment finance (TIF) district revenues from $3.54 million to nearly $3.8 million, or by 7%. He told the board that it appeared the budget would only be met if things “worked out exactly right.” He thus encouraged the board over the next 12-18 months to look closely at the actual revenues as they came in.

Board Budget Deliberations: Part 1

Hewitt led off by noting the budgeted drop in fund balance from $8,865,473 at the start of the year to $3,414,486 was due to the two major capital projects started this year: the underground parking garage at the Library Lot and the Fifth and Division streetscape improvements. In the 2010-11 budget, those expenditures are listed under “capital costs” in the amount of $2,796,507 from the parking fund and $2,020,753 from the TIF fund.

Responding to Mikus on the question of TIF  and parking revenue, Hewitt said that the TIF estimates came from the city of Ann Arbor. The increase in parking revenues, Hewitt said, would come as a result of a rate increase that will go into effect on July 1, 2010. [Those increases are part of a series of already-approved incremented rate increases that started in July 2009 and will ultimately see hourly rates in parking structures of $1.10 by 2012.]

Hewitt described how the total reserves over the next three years would be relatively low, reaching their low point in 2012-13. That low is based on the projections of the 10-year plan putting the total fund balance at $1.13 million  – a number that does not include the housing fund balance. After that low in 2012-13, the 10-year projections show total fund balances (minus the housing fund balance) of $2.8 million in 2013-14, $4.5 million in 2014-15, and $10 million in 2015-16. [The housing fund balance is not considered available for other use and is thus not counted in the reserve.]

Hewitt noted that they would be cutting back on some programs, given the “relative tightness” of the fund balances. First, he said, for the next year and possibly for the next two years, transfers to the housing fund out of the TIF fund would be reduced from $200,000 to $100,000. The balances in the housing fund, said Hewitt, would be made up following that three-year period.

The housing fund balance, observed Hewitt, would be about $1.3 million, even with the reduced transfer. Hewitt also observed that historically, the DDA had found it difficult to find places to invest housing fund dollars. Board member Russ Collins noted that it was a way of being “prudent with funds,” as Brad Mikus had suggested during public commentary.

Sandi Smith, a board member who also represents Ward 1 on city council, objected to the strategy on the grounds that there was no mechanism for ensuring that the housing fund balances would be restored as Hewitt had described. She suggested a separate resolution laying out how that would happen. She noted that most of the money in the housing fund was already encumbered in different ways, even though it hadn’t been spent. The unencumbered fund balance, said Smith, was only $200,000. She allowed that it had been difficult to find ways to spend housing fund dollars, but said that it was also important to restore it.

Board member Leah Gunn weighed in, saying that the board could always restore the funding if there were a project where it was needed, if someone brought a proposal to the board. The next couple of years, however, they would need to be “on a diet” in terms of spending discretionary income. For the next couple of years, though, Gunn said she felt it should stay the way it was – reduced to $100,000.

Hewitt, picking up on Smith’s point about the housing funds being encumbered, said that around $400,000 of that was encumbered by Village Green’s City Apartments project at First & Washington, which had no clear indication of when it would be started or completed – the housing fund payment will not be required until certificates of occupancy are issued. Hewitt felt like the board would be past the tight period by the time that $400,000 would need to be paid.

Responding to a query from board member Newcombe Clark via speaker phone, Hewitt said that the DDA’s responsibility was to pay for a 250-space parking structure that will be built on the bottom floors – $9 million upon certificate of occupancy. Hewitt said that for budgeting purposes that money would be needed 2.5 years from now – the time it would take if it were to start immediately.

Besides the $100,000 reductions in the housing fund transfer, other programs would be reduced, said Hewitt, including: Phase II of the energy grant program would be reduced from $250,000 to $0; grants to the four merchant associations would be reduced from $75,000 to $0; travel to the International Downtown Association conference would be reduced by $15,000.

Board member Jennifer S. Hall asked whether those items had been assumed to remain constant, when the DDA board approved the budget for the underground parking garage.

The conversation with Hewitt and Russ Collins yielded some uncertainty about what had been forecast in conjunction with the parking garage, but Hall returned to the idea that promises had been made about what would remain constant. What was it that had changed, she asked, that had resulted in the reductions?

Joe Morehouse, deputy director of the DDA, allowed that one unexpected shift in revenue had been from the 415 W. Washington parking lot, as well as revenues from the old YMCA lot at Fifth and William. [The city council requested and received approval from the DDA board to direct net revenues from those lots to the city. The council's action on 415 W. Washington came at its June 15, 2009 meeting, and action on the Fifth and William lot came at its Dec. 21, 2009 meeting. The ballpark numbers for revenues to the city from those two lots are $100,000 from the Fifth and William lot and $70,000 from the 415 W. Washington lot.]

Hall characterized the DDA’s actions, agreeing to direct those additional revenues to the city, as confirming it “after they asked for it.” She stressed that she wanted everyone to understand why the DDA board was forced to reduce its programs in the coming year.

For her part, Sandi Smith said that the energy grant and the housing fund reductions gave her pause. The $350,000, she said, did not make that big of a difference. She said she did understand that if a proposal came up, money could be moved into the housing fund. With respect to the energy grants, however, she felt it was an essential program. She noted that for Phase II of the program last year, the program had required only $58,000. [Phase I is an energy audit phase, while Phase II is implementation of recommendations from the audit.] Fifteen buildings had installed $138,000 worth of improvements – of which the DDA had paid just $58,000 – which would save $25,000 a year, she said. She emphasized that it was “direct dollars stimulating private investment in the downtown,” and that was core to the mission of the DDA. For that reason, she said, she was reluctant to see that disappear.

Board Budget Deliberations: Restoration of Phase II Energy Grants

Smith thus moved a resolution to restore $100,000 for Phase II of the energy grant program. The motion was seconded by Keith Orr. Weighing in by speaker phone, Newcombe Clark seemed to be in favor of putting all the funds back, including the merchant association allocations. Clark pointed out in the interest of full disclosure that he was no longer president of Main Street Area Association board.

John Mouat drew out from Hewitt the fact that concern for the minimum fund balance had driven the decision, and that all areas of the budget had been examined.

Orr weighed in for reductions in amounts as opposed to outright elimination of the items from the budget. He agreed with Smith that the energy grants were part of the DDA’s  core mission. He also acknowledged his ongoing association with Kerrytown District Association, which is one of the merchant associations that the DDA has historically funded.

Leah Gunn noted that the $9 million for the parking deck in connection with Village Green’s City Apartments project would not be spent for a very long time, as well as the $400,000 for the affordable housing grant. Hewitt cautioned that tomorrow they could announce that they’re going “full blast” and the DDA would need to meet those commitments.

Russ Collins said he supported his partnerships committee co-chair 100% – that’s Sandi Smith. From a practical point of view, said Collins, the DDA could make good use of the energy grant money. On procedural grounds, Collins objected to the fact that the operations committee had effectively made a policy decision on behalf of the partnerships committee. A reduction would have had a budget impact, Collins said, but the elimination amounted to a policy impact. About seeing the budget, Collin said, “It’s terrible to be surprised, and that’s a surprise.” Collins characterized adding another $100,000 to the deficit is “not extremely imprudent.” But picking up on Gunn’s comment, he said that assuming the $9 million won’t be spent was imprudent.

Collins allowed that the elimination of funds supporting the merchant associations had received a lot of discussion over the years, so the elimination of those didn’t bother him at all. He didn’t want to be “looped into” the sentiments in favor of keeping financial support for the merchant associations.

Jennifer S. Hall said she supported Smith’s amendment, but wanted to contemplate another one that would restore the other funds after voting on Smith’s proposal.

Mouat returned the conversation to the fund balance, expressed as a percentage of annual recurring operating expenses. Hewitt said the city wanted to see 15%, while Morehouse said he was looking to preserve 5%.

Smith echoed Collins’ sentiments that there could have been better communication from the operations committee. Board chair John Splitt clarified that when the operations committee had discussed the energy grants, they’d talked  about whether the money would actually be spent. They did not feel it would affect what would happen “on the ground,” Splitt said. At that point, Gunn called the question.

Outcome: The amendment to restore $100,000 to Phase II energy grants was approved, with Clark and Hewitt dissenting.

Board Budget Deliberations: Reduction of $2 million Contingency for the City

In following up on the intention she’d expressed to bring an additional amendment forward, Jennifer S. Hall proposed that the $2 million budgeted as a contingency for the city of Ann Arbor should be reduced to $1.65 million, with the balance of $350,000 allocated to the DDA programs that had been slated for elimination. The amendment was seconded by Newcombe Clark.

Hall noted that Joe Morehouse had indicated the change in the financial picture necessitating those eliminations had been the re-direction of parking lot revenues – from 415 W. Washington and Fifth and William – to the city of Ann Arbor. The $2 million contingency was there, she said, in order to accommodate a revenue request from the city. The revenue from those parking lots, she said, should be credited towards that $2 million.

Russ Collins cautioned that just because a line item has existed in a budget in the past does not mean it should exist in the future. Collins noted that the DDA’s “mutually beneficial” committee was in a good faith process with some good work already done, and that the resolution, he felt, would undermine that work. Leah Gunn told Collins that she did not want to see the negotiating position of the “mutually beneficial” committee weakened.

Hall recounted how the DDA had made a good faith effort to negotiate and how the city council had not followed up.  From a December 2009 Chronicle article: “City-DDA Parking Deal Possible“:

• Jan. 20, 2009: City council passes a resolution asking the DDA to begin discussions of renegotiating the parking agreement between the city and the DDA in a mutually beneficial way.
• March 4, 2009: DDA board establishes a “mutually beneficial” committee to begin discussions of the parking agreement between the city and the DDA. On the committee: Roger Hewitt, Gary Boren, Jennifer S. Hall, and Rene Greff. The DDA’s resolution establishing their committee calls on the city council to form its own committee.
• May 20, 2009: During the mid-year DDA retreat, mayor John Hieftje states publicly that city councilmembers object to Jennifer S. Hall and Rene Greff’s membership on the DDA’s “mutually beneficial” committee.
• June 3, 2009: DDA board chair Jennifer S. Hall removes herself from DDA’s “mutually beneficial” committee, replacing herself with Russ Collins.
• June 15, 2009: Mayor John Hieftje nominates councilmembers Margie Teall (Ward 4), Leigh Greden (Ward 3) and Carsten Hohnke (Ward 5) to serve on the city council’s “mutually beneficial” committee, and they’re confirmed at the city council’s July 20 meeting.
• July 1, 2009: DDA board chair Jennifer S. Hall appoints Sandi Smith to replace outgoing DDA board member Rene Greff (whose position is filled with Newcombe Clark) on the DDA’s “mutually beneficial” committee. Smith is also a city councilmember, representing Ward 1.
• August-December 2009: Sandi Smith, the chair of the DDA’s “mutually beneficial” committee, reports at each monthly DDA board meeting that there is nothing new to report.
• Dec. 5, 2009: Dissolution of the DDA is included in an “everything is on the table” list for discussion at the city council’s budget retreat.

Her position all along, said Hall, was that the arrangement needed to be mutually beneficial.

For his part, Clark noted that the contingency was simply there as a tool. “We’re not removing anything. It’s arbitrary.” Clark said he was not going to be in favor of cutting programs until the board understood exactly what the city was requesting: “It needs to be off the table until it’s on the table.”

Joan Lowenstein noted that the $2 million is not an arbitrary amount – it is the amount that has been paid under the parking agreement for the last five years. Lowenstein rejected Hall’s contention that the revenues from the 415 W. Washington and Fifth and William lots should count towards the $2 million, saying that those were”separate pools” and not a part of the same negotiation. Separate decisions were made on a separate basis, she said. The resolution, Lowenstein feared, would show that the DDA board was trying to “play games” with the city council.

Gary Boren, who also serves on the DDA’s “mutually beneficial” committee, said he was sympathetic to Russ Collins’ point of view about the resolution potentially undermining the committee’s work. However, it hurt the DDA when they had to cut programs that were working, he said. Boren noted that the DDA did not need to back off of the $2 million, but that the resolution would make clear to the city council that “this will take some skin out of us.”

Gunn expressed disappointment that the merchant associations did not report back about how they’d spent their money. Keith Orr responded by noting that a representative from the Kerrytown District Association had addressed the DDA board [at its Feb. 3, 2010 meeting] on that subject. Orr also suggested that the idea of “mutual benefit” could be replaced by “mutual sacrifice.”

Smith said she appreciated the spirit of the resolution, noting that the window display contest money was an example of a small amount of dollars that could go a long way.

Russ Collins called the question.

Outcome: Hall’s resolution to reduce the $2 million contingency by $350,000 failed, getting support only from Hall, Clark, and Boren.

Overall outcome: The budget was approved with support from Boren, Collins, Gunn, Hewitt, Lowenstein, Mouat, and Orr. Voting against it were: Hall, Clark, Smith, and Splitt.

Development Issues

The DDA board meeting included a variety of issues related to new development in the downtown area.

Library Lot

In August of 2009, the city of Ann Arbor issued an RFP for development proposals for the top of an underground parking garage currently under construction on the city-owned Library Lot, between Fifth Avenue and Division Street just north of the Ann Arbor District Library. At its Wednesday meeting, the DDA board got updates on construction and planning for the top of the structure.

Reporting out from the capital improvements committee, John Splitt gave an update on the construction of the underground parking structure along Fifth Avenue. Earth retention preparation work was nearly complete on the “dogleg” – the section of the lot abutting Division Street. [The work consists in part of drilling large holes deep into the ground and inserting steel beams into those holes.] That means people will start to see “real digging” as soon as next week, Splitt said. [As of Thursday, March 4, digging in earnest seems to have commenced, based on Chronicle observation.]

Bid package #3, Splitt reported, which is for the concrete and steel work, would be opened publicly at 2 p.m. in DDA offices the following day. [The bids will first be reviewed for numerical accuracy. Then any conditions specified by the contractors checked, and interviews will be held with the lowest three bidders to review the scope of work – a meeting for that is scheduled on Tues., March 9.]

In his report out from the Downtown Citizens Advisory Council, Ray Detter said that the DCAC opposed the placement of a large park on top of the Library Lot, where the underground parking garage is being constructed. [The two open space proposals submitted in response to the city's RFP have since been set aside for further consideration by the committee: "Two Library Lot Proposals Eliminated"] The DCAC did, however, support the idea of taking the next two years to plan that entire area of the downtown, said Detter.

Reporting out from the Library Lot RFP review committee, John Splitt said that Ann Arbor city administrator Roger Fraser had not yet hired a consultant who would be examining the financial aspects connected with the two proposals that are being given further consideration by the committee.

Sandi Smith noted that the RFP schedule was designed so that if a decision were made to move ahead with a particular proposal for development, changes in the design of the underground structure could be undertaken. She noted that the window of opportunity seemed to have been missed by now, and wondered if that did not perhaps remove some of the timing pressure to get to a decision. Susan Pollay, executive director of the DDA, confirmed that the parking garage was “on its way” now as designed. However, she pointed out that the design teams of the two remaining proposals under consideration were very familiar with the underground parking garage design, and that they would be able to accommodate their projects to its design.

Jennifer S. Hall inquired about the possibility that the extra supports designed into the underground garage – so that something could be built on the top of the underground garage – could be stripped out. [Proposers of a public gathering space, the Ann Arbor Community Commons, have called for such a strategy in order to free up money to pay for implementation of their commons.] Pollay told Hall that stripping out those supports would actually entail re-engineering the design of the garage and would, in fact, add cost.

Zingerman’s Expansion

In his report out from the Downtown Citizens Advisory Council, Ray Detter called the board’s attention to a public participation meeting for a proposed expansion of Zingerman’s Deli operations scheduled for March 8 at the deli, 422 Detroit St., starting at 5 p.m. Zingerman’s plan generated “heated discussion” at DCAC, said Detter. The deli is located in the Old Fourth Ward historic district. He said they agreed that Zingerman’s is an essential part of the community, but that they needed to make sure there’s not a precedent set that would undermine planning. The decision needed to be oriented around the city’s planning documents: the downtown plan, the central area plan, and the historic district.

Downtown Zoning and Design Guidelines

In remarks made at the end of the meeting during a time allotted to bring up other DDA business matters, Roger Hewitt expressed some frustration about the city council’s appointment of a task force charged with the responsibility of establishing design guidelines for downtown zoning. By way of background, Hewitt had served on the A2D2 steering committee that oversaw a years-long rezoning process, along with city councilmember Marcia Higgins, and Evan Pratt, of the planning commission.

City council ultimately approved the downtown zoning amendments, but did not enact the design guidelines, pending completion of a design guideline package that would include some kind of mandatory process with voluntary compliance. [See Chronicle coverage: "Downtown Planning Process Forges Ahead: New zoning approved, design guides will take longer"]

At the February 2010 DDA board meeting, Hewitt’s remarks showed that he had not been kept apprised of the fact that the A2D2 committee had been dissolved, after the city council had approved the rezoning component but before the design guidelines were completed:

In reporting out from the A2D2 oversight committee on which he serves, Roger Hewitt stated that the last meeting had been canceled and so he had nothing to report.

Later in the meeting, John Hieftje told Hewitt that the A2D2 oversight committee had actually been dissolved. This seemed to come as news to Hewitt, who said simply, “Oh!”

Said Hewitt about the design guidelines: “Apparently we’re going to revisit the entire process.” He noted that there was no representation from the DDA on the design guidelines task force, even though it would have a “profound impact” on the downtown area. Russ Collins wondered how that might be best addressed. Hewitt responded with humor, suggesting that he might talk to any councilmembers that Collins might know, who might be sitting next to him – the allusion was to Sandi Smith, who serves on the city council, representing Ward 1, in addition to serving on the DDA board. Smith and Collins co-chair the DDA partnerships committee.

In his report out from the Downtown Citizens Advisory Council earlier in the meeting, Detter said that they were glad to see the city council appointment of a task force to look at the design guidelines that will accompany the A2D2 rezoning of the downtown. That task force would be led by councilmember Marcia Higgins, he said, with Wendy Rampson (the city’s head of planning), Kevin McDonald (senior assistant city attorney), Kirk Westphal (planning commissioner), as well as Norm Tyler, Peter Pollack, and Tamara Burns. Detter said that out of the task force’s work they expected to get a system of required compliance with a process, including a review by a design board, and voluntary compliance with the outcome of that process.

Parking Surveys

Roger Hewitt reported on two surveys – one conducted online as part of the DDA’s effort to gauge public opinion about parking issues in preparation of a report it will make to the city council in April.

Online Parking Survey: Principles and Implementation

The online survey ran for 10 days between Feb. 9, 2010 and Feb. 19, 2010 and received 1,283 responses. Of those respondents, 73% reported being Ann Arbor residents, while 27% reported being non-residents. Almost an equal number of residents – 41% and 40%, respectively – reported being 51-71 years old and 31-50 years old.

Hewitt said there was “strong alignment” with the basic principles the DDA used, but more divided opinion about the specific implementation of those principles. For example, there was a 17-17 split between positive and negative comments on the investment in the underground parking structure. And support for some specific policies depended on respondents’ use of parking services: 59% of parking permit holders supported improving bicycling infrastructure, while low-frequency parkers supported it at an 81% rate.

Of the 54 respondents who weighed in on extended evening meter hours, 85% wanted evening parking to remain free. About the new e-park system, 61 respondents commented on the machines, and the written summary indicates that frustration was expressed about the “speed of the machines, screen visibility and reduced convenience and ease.”

On-Street Parking Survey: e-park

A second, on-street survey described by Hewitt at Wednesday’s meeting targeted e-park users specifically. Users of e-park stations on State, Liberty, Detroit, and Main streets were surveyed between Feb. 19 and Feb. 25 – 95 people responded. Hewitt characterized those responses to the survey as “pretty overwhelming” on the positive side, with 91.4% of respondents characterizing the machines as very easy, easy, or somewhat easy to use.

Hewitt also mentioned that paying by phone was not described by respondents as useful, perhaps because many of them indicated that they did not know it was an option. Hewitt suggested that some marketing work could be done on that. [.pdf of e-park survey results]

How useful are the following e-park features:
                                                   Don't Know,  Response
                    Very useful Useful Not useful  Never Used   Count           

Pay by credit card    61.1%     29.5%     0.0%       9.5%        95
Pay with coin         38.7%     53.8%     1.1%       6.5%        93
Add time at any epark 57.0%     24.7%     4.3%      14.0%        93
Pay by cell phone     20.4%     10.8%     8.6%      60.2%        93

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Other Business

The board heard a number of other reports and comments.

Wireless Washtenaw

Reporting out from the partnerships committee, Sandi Smith told the board they’d received a presentation on Wireless Washtenaw from Tom Crawford, the city of Ann Arbor’s CFO. Smith said that Crawford had explained that the priority for the rollout of wireless high-speed Internet access had been in rural areas, where there was currently no access at all. [James McFarlane, who manages Washtenaw County's information technology operations, gave county commissioners an update recently on the status of the Wireless Washtenaw project.]

Smith also reported that Crawford had told them about another possibility for wireless access. There’s potential that the bandwidth made available by TV stations previously used to broadcast an analog signal could eventually be available for wireless Internet connectivity.

DDA Board Retreat

Roger Hewitt announced that the DDA retreat had been scheduled for March 16 with the gathering for lunch starting around “noonish.” The retreat will be held at the offices of Bodman LLP in Suite 400 at 201 S. Division. One main topic of the retreat will be urban versus suburban identity, as well as the comprehensive parking plan.

Sandwich Sign Boards

Reporting out from the transportation committee, Keith Orr gave an update on the status of the sandwich sign board ordinance that the city council had considered, which would have made the signs legal, but put a permitting system in place. Susan Pollay, executive director of the DDA, had appeared before the council at its Feb. 16, 2010 meeting to ask the council to adopt the new ordinance, minus the permitting system:

Also during the public hearing, Susan Pollay, executive director of the Downtown Development Authority, read a brief statement on behalf of the DDA, saying that sandwich board signs are part of what makes for a vibrant downtown experience. She suggested that the system be adopted without permits and then reviewed after one year to determine if there was adequate compliance.

Orr reported that the city council had voted down the ordinance – which Sandi Smith then stressed meant only the demise of the current attempt to make the sandwich boards legal and to regulate them somehow. The fact that the sandwich sign boards remain illegal was, said Orr, “perhaps not the desired result.” Russ Collins kidded Orr as to whether he was recommending that merchants commit acts of civil disobedience.

Bicycle Hoop Requests, Maps

Reporting out from the transportation committee, Orr called attention to a feature on the DDA website that allowed people to request installation of bicycle hoops. He also indicated that DDA intern Amber Miller was working on a bicycle map for downtown.

Downtown Citizens Advisory Council

Ray Detter gave his report from the Downtown Citizens Advisory Council, which meets the evening before the DDA board holds its regular Wednesday noon meeting. [The majority of Detter's comments during his update are reflected in previous parts of this meeting report.]

He said that DDA board member (and Ann Arbor city council member) Sandi Smith had attended the meeting. The DCAC had covered a number of topics, Detter said, including efforts to improve maintenance and safety at Courthouse Square – a housing complex for seniors at the southwest corner of Huron and Fourth Avenue. Detter told the board that the DCAC continued to support the DDA’s efforts at transportation demand management.

Present: Gary Boren, Newcombe Clark (via phone), Jennifer S. Hall, Roger Hewitt, John Splitt, Sandi Smith, Leah Gunn, Russ Collins, Keith Orr, Joan Lowenstein, John Mouat.

Absent: John Hieftje.

Board retreat and next regular board meeting: A retreat will be held on Tuesday, March 16 at the offices of Bodman LLP, Suite 400, 201 S. Division, starting at noon. The next regular board meeting is at noon on Wednesday, April 7, 2010, at the DDA offices, 150 S. Fifth Ave., Suite 301. [confirm date]

Larry Deck, board member of the Washtenaw Bicycling and Walking Coalition, addressed the council during the public hearing on the repeal of the city's bicycle registration system. (Photos by the writer.)

The council scrapped the city’s existing bicycle registration program at its Monday night meeting, but gave an assurance to a representative of the Washtenaw Bicycling and Walking Coalition that it would soon be replaced with something better.

Mayor John Hieftje used his communications time to rebut criticism of the planned Fuller Road Station – both with respect to its funding and its siting. While he assured critics that funding for the project would not come from the general fund, he allowed that he did not know how the project would be paid for.

And Christopher Taylor (Ward 3) reiterated enthusiasm for Ann Arbor’s response to a request for information by Google about a local fiber-optic network. He had also introduced the topic at a recent council meeting focusing on the budget.

The city administrator’s report to the council included updates on construction projects.

The city also continued a monthly recognition of its parks volunteers with a mayoral proclamation honoring Praveena and Madhan Ramaswami for their efforts to improve Bromley Park by organizing biannual events to remove invasive plants, plant flowers, and clean up the park.

Elimination of Bicycle Registration Program

The council had given initial approval of the measure at its previous meeting, which eliminates the city’s bicycle registration system.

At a February meeting of the council – in the context of discussions on a possible revision to the registration program, as well as a revision to all the city’s ordinances on bicycling – Carsten Hohnke (Ward 5) had reported that the registration program had in recent years, not resulted in the return of stolen bicycles to their owners. The return of stolen bicycles to their owners is an often-cited benefit of the program.

Specifically, Hohnke had said that from September of 2007 to the present, 39 stolen bikes had been recovered and returned to their owners – but in none of those cases had the bicycle registration program been instrumental. The return of those bicycles had been the result of regular police work.

The revisions the council had considered – but postponed and ultimately tabled – involved fee structure and the map that’s provided with registration.

On Monday’s council agenda was the second reading of the ordinance revision, with its related public hearing.

Public Hearing on Bicycle Registration

At the public hearing, Larry Deck, a board member of the Washtenaw Bicycling and Walking Coalition, was the only person who spoke. He said that in January, the WBWC had suggested revisions to the program, but the group had not suggested its elimination. He asked for more time for discussion, because bicycle registration had a number of benefits. The WBWC was having a board meeting on March 4 and wanted to discuss the matter. Deck asked the council to defer action until April and to identify relevant city staff and others in the community to continue the discussion on bicycle registration.

Council Deliberations on Bicycle Registration

Hohnke began council’s deliberations by indicating that he was amenable to postponing the resolution at the WBWC’s request but hesitated to make that motion – in deference to Marcia Higgins (Ward 4), who had sponsored the resolution, but who was not at the council table. Higgins was present at the meeting, but had left the table at the conclusion of Deck’s speaking turn at the public hearing, to engage Deck in a private conversation in the hallway outside the council chambers.

Responding to Hohnke’s suggestion to postpone, city administrator Roger Fraser told the council that the city essentially had an ordinance on the books that it was not enforcing, which put the city in a state of legal limbo. He suggested going forward with eliminating the registration system, with all of its records, and having a discussion with the WBWC about a future ordinance.

Sandi Smith (Ward 1) countered Fraser’s idea that it put the city in a state of legal limbo, saying that even if that were the case, it seemed fairly benign. She was in favor of putting it off, pending the outcome of whatever conversations Higgins was having in the hallway.

Higgins returned to the table and reported that the WBWC had some ideas about a new replacement ordinance and would work over the next 2-3 months on that. She stated that in that context, she believed the WBWC was okay with the program’s elimination. Deck was called to the podium and confirmed: If the intent was to eliminate the registration program but replace it with something better, then the WBWC was okay with that.

Outcome: The council voted unanimously to eliminate the city’s bicycle registration program.

Fuller Road Station

Fuller Road Station is a cooperative venture between the University of Michigan and the city of Ann Arbor to construct a 1,100-space parking deck near the UM medical campus. From previous Chronicle reporting ["Work Session: Trains, Trash and Taxes"]:

In broad summary strokes, the  Fuller Road Station project is proposed for a three-acre site – currently a surface parking lot – owned by the city of Ann Arbor, nestled just south of Fuller Road and north of East Medical Center Drive and the railroad tracks. It’s billed as a way to link automobiles, east-west commuter rail (demonstration due in October 2010), the north-south Plymouth-State Street corridor (study underway funded by AATA, UM, the  city of Ann Arbor, and the Ann Arbor DDA), buses, and bicycle traffic via the Border-to-Border trail.

There was not an agenda item related to Fuller Road Station, but it has been the topic of much community discussion.

Public Comment on Fuller Road Station

During public commentary reserved time at the start of the meeting, Nancy Shiffler stressed that SEMCOG’s approach in exploring the east-west commuter rail option, which would link Ann Arbor to Detroit, was to use as much existing infrastructure as possible. [There is an active Amtrak station on Depot Street, near the planned Fuller Road Station site.] The idea, she said, was to use that existing infrastructure to assess whether the initiative warranted full support – that assessment would come in 2013, she said.

The Fuller Road Station, Shiffler pointed out, might include a commuter rail station in a second phase. For now it was planned largely as a parking structure with completion in 2012, with UM paying for and using 78% of the spaces.  Shiffler raised several concerns about the lease arrangement for the new structure as well as the “permanent re-purposing” of the land, which is designated as parkland by the city.

Shiffler also stated that she assumed the city would be paying for the project out of its general fund.

Also at the start of the meeting, James D’Amour weighed in on Fuller Road Station. He told the council that he was there wearing two hats – one as a member of the Sierra Club’s Huron Valley Group executive committee and the other as an individual. [D'Amour has previously addressed the council on the topic of Fuller Road Station.] He said he was there to reiterate concerns about the planned station. While the Huron Valley Group supported public-private efforts for mass transit, including the east-west rail, they had concerns about process.

D’Amour characterized the public process as “after-the-fact” consultation. The planned station also entailed removal of parkland. Of the more than 1,000 parking spaces, he pointed out, only about 200 related to mass transit.

On a personal note, he said that the idea of applying “green architecture” to the Fuller Road Station was like putting lipstick on a pig. The city’s cost for the project would be several million dollars, he pointed out, at a time when the city was talking about cutting recreation programs like Mack Pool and the Ann Arbor Senior Center, and laying off police officers and firefighters.

Mayor’s Rebuttal on Fuller Road Station

Mayor John Hieftje used his time for communications to respond to criticism of the Fuller Road Station that the council had heard during public commentary.

He prompted city administrator Roger Fraser to speak to the issue of how the city’s portion of the project would be funded, by asking Fraser if it was the plan to use money from the general fund. Fraser’s answer: “No, sir.” Hiefjte allowed, however, that the financing plan had not yet been formulated.

Addressing the issue of the land’s status as parkland, Hieftje pointed out that the parcel had been obtained as an easement in a land swap deal with the University of Michigan, motivated by a desire to preserve some Bur Oak trees. A condition on the swap, he said, was that the city would lease the land back to the university.

Hieftje laid out a case of that location as the best possible place for a transit station, noting that the university’s health system employs 17,000 workers. He allowed that it was a parking structure that was planned, but contended that it went beyond that – it also has a bus station, he said. It would be a whole new hub for the city’s bus system, he said. Hiefjte also noted that it was located in the corridor being studied for a north-south connector, from Ann Arbor to Howell.

The current Amtrak station, Hieftje stated, would not work for commuter rail. If the second phase of the Fuller Road Station were eventually to be built, Hieftje indicated that there would also be a bike station with a repair facility and a place for cyclists to take showers. He concluded by saying, “If you are a believer in mass transit, there’s no better place for it than on this site.”

Marcia Higgins (Ward 4) pointed out that construction of the parking structure at the Fuller Road site relieved the pressure the university felt to build two parking structures on Wall Street in order to meet its parking demands. [The planned Wall Street structures were not embraced by the neighbors along the street.]

City administrator Roger Fraser said the expectation was that access to city parks would actually be improved – cars currently parked across Fuller Road from the planned station would be parked in the structure, and that would “free up land for that game of frisbee,” he concluded.

Sabra Briere (Ward 1) raised a couple of questions with the mayor about the site. She reported that she’d learned from Christopher Taylor (Ward 3), who serves as one of the council’s representatives to the city’s park advisory commission, that the parcel is still in the PROS (Parks, Recreation and Open Space) plan. She inquired whether it would be reconsidered as parkland in a line of questioning that resulted in Hieftje ultimately saying, “That’s a better question for the city attorney than for me.”

Briere also noted that her understanding of the funding for the Fuller Road Station was “a little vague.” She wanted to know if the city anticipated getting revenue from parking fees for spots in the structure. Hieftje deferred the question, saying that the city could respond to that when the numbers are worked out a little better.

Council Communications

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Google Fiber

During his communications, Christopher Taylor (Ward 3) reiterated his enthusiasm for the idea of the city responding to a recent request for information issued nationwide by Google. The request involves the possibility of Google building a fiber network in a community on an experimental basis, which would provide Internet access to individual homes at speeds roughly 100-times what most people currently enjoy.

There will be a public hearing on the subject at the city council’s next meeting on March 15, 2010, Taylor said.

Taylor noted that there’d been singing during public commentary at the council in the past and that perhaps there would be singers at the public hearing on the possible Google fiber network.

The city is partnering with the University of Michigan in this effort, which is described on the A2Fiber website.

Ann Arbor Skatepark

Carsten Hohnke (Ward 5) announced that the latest effort at fundraising by the Skatepark Action Committee was an event, the Grinds of March, to be held on March 13 from noon-6 p.m. The event would include skating performances by national-level skaters, Hohnke said. As part of the fundraising effort, old hand-drawn posters that have appeared in Zingerman’s Deli windows over the years will be available for purchase.

[The Grinds of March is located at 704 Airport Blvd. in a warehouse where the Skatepark Action Committee has built a wooden skateboard ramp. The likes of Andy MacDonald will be skating the Grinds.]

Local: Food and Money

In her communications, Sandi Smith (Ward 1) alerted her colleagues to a local food summit, which would be held the following day, Tuesday, March 2.

She also announced that the nonprofit Think Local First was conducting an inquiry into the feasibility of a local currency. [See Chronicle coverage: "Local Currency for Washtenaw County"]

Communications from the City Administrator

City administrator Roger Fraser reported that construction on the co-located 911 dispatch center in Fire Station #1 across the street from city hall was now complete, with operations on schedule to begin in May.

The fire station is directly across the street from the new municipal center (also known as the courts/police building), which is under construction at the corner of Huron and Fifth. Fraser reported that people would notice a sign of progress over the next few days: The external buck hoist, which is a lifting carriage used to get materials to the upper floors of a building, will be removed. That’s possible because permits have now been received for an elevator inside the building.

Asbestos abatement has concluded in the city hall basement, Fraser reported, so demolition of walls can proceed.

Fraser indicated that city staff had been really busy recently with snow removal during the period when 9.6 inches of snow fell, with 3-4 inches over the following days. He introduced the subject by deadpanning: “Some of you know we had a snowstorm …” Fraser said that it was the one major storm of the year, in contrast to previous years, when multiple major snowstorms hit the area.

Fraser also reported that there’d been interest expressed from a community in Australia in the city’s metering data for its water system.

Other Public Commentary

Alan Haber addressed the council on the topic of the development of the Library Lot. [Previous Chronicle coverage: "Two Library Lot Proposals Eliminated"] Haber had helped put forward a proposal, the Ann Arbor Community Commons, that envisioned the use of the space as a community gathering place. Haber advocated for shifting bond money from paying for stronger foundations of the underground parking garage, which are needed to support development on top of the lot, to the construction of a park on the top. There was not need for the stronger foundations, he said, because they wanted the park to be there forever.

Haber contended that most people who are not developers want some kind of park there. He asked the council to lean on the Downtown Development Authority, which is building the underground parking structure, to provide the information on park maintenance costs that his group had been asking for.

Thomas Partridge introduced himself as a Washtenaw County Democrat who’d been a recent candidate for the county board of commissioners. He told the council that he’d come out in the cold to call on all parties to bring about equitable budget reforms for the city, the county, the region, the state and the entire nation. He called on people of all religions and races to work together to protect the rights of senior citizens and disabled people.

Present: Stephen Rapundalo, Mike Anglin, Margie Teall, Sabra Briere, Sandi Smith, Tony Derezinski, Stephen Kunselman, Marcia Higgins, John Hieftje, Christopher Taylor, Carsten Hohnke.

Next regular council meeting: Monday, March 15, 2010 at 7 p.m. in council chambers, 2nd floor of the Guy C. Larcom, Jr. Municipal Building, 100 N. Fifth Ave. [confirm date]

Tony Derezinski (Ward 2), who co-sponsored a new ordinance banning use of cell phones while driving or bicycling. The ban does not apply to driving one's council chair before the meeting starts. (Photos by the writer.)

But it was approved without the support of the measure’s two sponsors, Marcia Higgins (Ward 4) and Stephen Rapundalo (Ward 2). The version adopted by council specified a 3% minimum cut in compensation packages, taken over the aggregate of non-union workers. By the time the resolution was passed, it had also shed a “whereas” clause that Christopher Taylor (Ward 3) called “self-laudatory.”

In development news, The Moravian – a planned unit development (PUD) proposed on East Madison Street – received unanimous council support at its first reading. Approval at two readings is required for final approval. But Stephen Kunselman (Ward 3) responded to a resident request made at the previous night’s caucus to give some clue at the first reading as to how councilmembers were thinking about the project: “I’ll be voting against it at second reading – so there’s no question in the community’s mind.”

Based on the Sunday caucus, The Moravian will face a protest petition, which raises the bar for approval from six to eight votes.

The council also wrangled through a proposed ban on cell phone use while driving and bicycling – at a level of detail unusual for a first reading. The measure had undergone enough revisions since it was approved at the council’s previous meeting that its status Monday was reset to a first reading. Dissent on the ban came from Sandi Smith (Ward 1), who questioned whether it should be undertaken at the local level – as opposed to the state. Marcia Higgins (Ward 4) also dissented, pointing to the fact that the ban did not include hands-free phones.

The council also transacted a variety of other business, including a repeal of the city’s bicycle registration program, which is to be replaced with a new system after further consultation with stakeholders. The bicycle registration program, as well as other business and announcements, will be wrapped up in Part 2 of this report.

The 3% Budget Directive

Before the council on Monday was a resolution that gave the city administrator, Roger Fraser, direction on preparing the city’s budget. Fraser must, per the city charter, submit a budget to the council by its second meeting in April – this year, that’s on April 19. By May 17, their second meeting in May, the council must vote to adopt the budget with any amendments they choose to make. If the council does not adopt a budget, then the budget proposed by the city administrator is adopted by default.

The resolution before the council on Monday night requires Fraser to report back on the directives by April 1, which is before the budget proposal is due.

The resolution before the council differed from an earlier version, which had called for a 3% reduction in the “base salary” of non-union workers. The version before the council on Monday called for a minimum of a 3% reduction in their “compensation packages.”

Budget Directive: Amendment on Travel Allowance

The resolution before the council eliminated a $1,000/year travel allowance for the mayor and a $560/year travel allowance for councilmembers.

Sandi Smith (Ward 1) proposed an amendment to keep the mayor’s travel allowance, saying that it’s important for the mayor to go forward throughout the state to represent the city. Mike Anglin (Ward 5) agreed, saying that he’d been unaware that councilmembers had a travel allowance, and that he didn’t need one. However, said Anglin, the mayor is the symbol of the city.

Outcome: The amendment to keep the mayor’s travel allowance was approved, with dissent from Stephen Rapundalo (Ward 2).

Budget Directive: Amendment on Self-Laudatory Language

The resolution included a “whereas” clause that listed off councilmembers who had voluntarily committed to giving back 3% of their council salaries as having demonstrated leadership. [Chronicle coverage: "Ann Arbor Council Delays Vote on Pay Cuts"]

Christopher Taylor (Ward 3), whose name was listed, said that for his part he felt the clause was “self-laudatory” and did not see the need for it. An accompanying “resolved” clause called on all councilmembers to commit to the 3% give-back. Independently of whether it was possible for the council to compel the action of individual councilmembers, said Taylor, he felt it was not proper as a body to mandate something that is voluntary by nature.

Outcome: The clauses involving city councilmembers’ 3% salary give-back’s were deleted, with dissent from Marcia Higgins (Ward 4) and Stephen Rapundalo (Ward 2).

Budget Directive: Amendment on Percentage for Administrator and Attorney

Sabra Briere (Ward 1) proposed an amendment to a “resolved” clause that singled out the city attorney and the city administrator among the non-union workers targeted by the resolution for a minimum 3% reduction in compensation.  The attorney and the administrator are positions that report directly to the council, and the council sets their salaries.

Calling the 3% artificial, Briere said she felt the top of the pay scale could take a bigger hit: 5%.

Sandi Smith (Ward 1), however, said that she was encouraged by the word “minimum” and thought that it allowed enough flexibility, so she didn’t support specifying 5%.

Stephen Kunselman (Ward 3) wanted to know what the implications were numerically – the compensation packages covered salary, benefits, and vacation days. As much as he wanted the top administrators to show leadership, said Kunselman, he hesitated to use a broad brush.

Foreground to background: Margie Teall (Ward 4), Marcia Higgins (Ward 4), Carsten Hohnke (Ward 5), Mike Anglin (Ward 5).

Stephen Rapundalo (Ward 2) and Marcia Higgins (Ward 4), who had sponsored the resolution, said that the April deadline provided an opportunity to give additional direction before the final budget is proposed by the administrator.

Mayor Hieftje noted that council sets the pay of the city administrator and the city attorney, and could do so at their next performance review.

Higgins also noted that the resolution was a way to give public notice of the expectation and to give the two top administrators the “platform” to make changes.

Carsten Hohnke (Ward 5) noted that the 3% reduction was what they’d asked staff in general to accept and that the language specified a minimum, so he was not supportive of the amendment. He allowed, however, that if the amendment passed, he would be contributing an additional 2% of his council salary back to the city to bring his total up to 5%.

Christopher Taylor (Ward 3), however, said he felt that 5% was the proper place for the bar to be set.

Outcome: Briere’s amendment that reduced the city attorney and the city administrator’s compensation by 5% – instead of a minimum of 3% – failed, with support only from Briere and Taylor.

Budget Directive: Amendment on Collective versus Distributive

For linguists who specialize in the sub-field of semantics focusing on the the interpretation of English plurals, Monday’s council meeting would have been a welcome respite from their usual fodder, which tends to focus on pianos and the men who lift them.

Consider, for example, the following sentences about some men, say, Smith, Jones and Green:

1. The men ate cake.
2. The men gathered in the kitchen.
3. The men lifted a piano.

Sentence (1) is true just when Smith, Jones, and Green each ate cake. That is, the meaning of sentence (1) requires the eating of cake to distribute over each of them: Smith ate cake, Jones ate cake and Green ate cake. For sentence (2), Smith, Jones and Green each have to be in the kitchen together in some event of gathering, but the sentence is not about the men as individuals – it’s about the men collectively. That is, the meaning of the sentence does not require that Smith gathered, Jones gathered and Green gathered.

Sentence (3) is the one that applies to the discussion at the city council meeting. It’s a sentence that has a distributive meaning – it could be about Smith lifting a piano, Jones lifting a piano and Green lifting a piano. Or it could have a collective meaning – it could be about Smith, Jones and Green, who worked together to lift a piano. On the collective meaning, it’s not the case that Smith lifted a piano, and Jones lifted a piano and Green lifted a piano.

At issue was the following “resolved” clause in the budget resolution:

RESOLVED, That beginning July 1, 2010 the compensation packages for all non-union employees will be reduced by a minimum of 3%;

Replace “the compensation packages for all non-union employees” with “the men” and replace “be reduced by a minimum of 3%” with “lift a piano” and you get something like sentence (3).

Councilmembers debated whether the resolution meant that the total of compensation packages summed over all employees had to be reduced by 3% – maybe Smith got a 1% cut but Jones got a 4% cut – or rather that it meant each employee had to get at least a 3% cut.

The Chronicle asked Peter Lasersohn, a professor of linguistics and specialist in the semantics of plurals at the University of Illinois, to weigh in on that question. His response was unambiguous:

Sentences with plural definite subjects are systematically ambiguous between collective and distributive readings, so I think the “RESOLVED” clause can be interpreted either way. I feel bad for Jones …

At the city council meeting, it was Carsten Hohnke (Ward 5), who brought up the question of the distributive versus the collective understanding of the sentence. He’d begun his questioning by asking if the city administrator was “compelled” by the resolution to deliver a budget as described by the resolution. City attorney Stephen Postema allowed that this was the intent of the resolution, but that it was the budget process itself [see section introduction] that compelled the kind of budget the council wanted.

As Christopher Taylor (Ward 3) wraps up his point about the aggregate interpretation of the budget directive, Sabra Briere (Ward 1) raises her hand to ask to speak.

Hohnke wanted to know if the 3% reduction applied to each person. Turning to Fraser, he asked: “How do you understand this?” Fraser replied that the resolution did not specify how to do it and that his staff’s job was to come back with their suggestion as to how to do it.

About the idea that it was each employee who had to have at least a 3% cut, concluded Hohnke: “That’s not what I’m understanding you to understand.” Otherwise put, Hohnke was on the same page with Fraser that it did not require a minimum 3% reduction of each employee’s compensation.

Christopher Taylor (Ward 3) weighed in, saying that it was fine if the intent was to allow for an aggregation that amounted to a 3% reduction, but contended that was not what the resolution said. “If Jones is not reduced, then it’s not consistent,” he said. Taylor then proposed an amendment that added the phrase “in the aggregate.”

Marcia Higgins (Ward 4) objected, saying that what Taylor was doing was changing the words to something that Fraser already understood the resolution to mean, and that they would have an opportunity to make any adjustments in April.

Sabra Briere (Ward 1) characterized the change as a grammarian’s correction, which she appreciated. City attorney Stephen Postema weighed in, saying that Higgins was correct about the opportunity in April, but allowed that Taylor’s suggestion of “in the aggregate” was useful.

When Sandi Smith (Ward 1) attempted to end the deliberation on Taylor’s proposed amendment by “calling the question,” the motion to end deliberations narrowly failed with only five votes – those of Smith, Briere, Rapundalo, Higgins, and Hohnke.

So Stephen Rapundalo (Ward 2), who sponsored the original resolution, weighed in. The intent, he said, actually was to set a baseline, with the idea that Fraser could adjust that.

Margie Teall (Ward 4) observed that Fraser and Taylor had a different interpretation of what the resolution said – so it was worth addressing – and wondered if deleting the word “all” would help. Taylor didn’t think so, saying that it was useful for highlighting the aggregate.

Tony Derezinski (Ward 2) took the “grammatical quibbling” to illustrate the futility of the process. By “process” he meant the idea that the council would express a budget directive in the form of a resolution. He’d weighed in earlier during the deliberations against the idea of doing that, and asked Higgins, who was one of the most senior members of the council, if that had been done in the past. Higgins affirmed it had been done.

Also on the subject of process, earlier in the deliberations Rapundalo had said that in the past the budget committee had given budget directives that had “never seen the light of day.” Passing a resolution of the council was a way to make it public and transparent, he said.

Mayor John Hieftje gave a nudge to wrap up the discussion by saying that if they were spending that much time on this amendment, then the budget decisions themselves were going to be “fun.”

Before they voted on Taylor’s amendment, Hohnke picked up on the topic of process, and noted that Fraser had asked the council for direction, and that the resolution provided that explicit direction.

Outcome: The amendment inserting “in the aggregate” succeeded, with Anglin, Briere, Derezinski, Taylor, Kunselman, Teall and Hohnke voting for it.

Overall final outcome: The council passed the 3% budget directive resolution as amended, with dissent from Derezinski, Rapundalo and Higgins.

Ban on Cell Phone Use While Driving

Before the council was an ordinance that prohibits use of cell phones while driving or bicycling.

Cell Phones: Public Commentary

At the conclusion of their meeting during public commentary general time, two speakers addressed the council about cell phone use. One speaker was concerned about allowing exceptions for certain people involved in emergency preparedness exercises – that set a bad precedent, he said. He encouraged the city to allow the issue to be addressed at the state level.

A second speaker asked the council to at least consider the cost of informing the public that such an ordinance would be enforced in the city, noting that there were numerous access points into the city, where signage might be required.

Cell Phones: Council Deliberations

The ordinance had already won the support of the council at its previous meeting. But it had undergone changes that were numerous enough that an additional first reading was warranted, said one of the measure’s sponsors, Stephen Rapundalo (Ward 2), on Monday. The changes were not really substantive, he contended, but their sheer number created enough red lines that it gave “the appearance thereof.”

Paul Green, a research professor at the University of Michigan Transportation Research Institute, provided some expert testimony on cell phone use while driving.

The changes, he said, were the result of various communication with other councilmembers and community members. Rapundalo called to the podium Paul Green, a research professor at the University of Michigan Transportation Research Institute, whose research focuses on driver distraction and driver workload.

One of the key research findings that Green explained to councilmembers was the idea that the problem with cell phones is not the object held in the hand, but rather the distraction of the conversation. The proposed ordinance would also make it illegal to do “destination entry” for GPS devices – Green explained that the distraction of a GPS device use was in the attention required to do that data entry, not in reading the map or listening to directions.

Why, asked Christopher Taylor (Ward 3), was talking on the phone different from talking to a passenger? Green explained that the key difference was that the passenger is also aware of the driving situation: you come to a stop, then look left and right – your passenger also looks left and right. The person on the other end of a cell phone conversation with a driver, Green said, will continue to “blab on until they hear a crash.” Listening to the radio, Green said, is completely discretionary, whereas the demands of a phone conversation are not – it’s rude not to take one’s regular conversational turn.

Tony Derezinski (Ward 2) wanted to know whether the ordinance made cell phone use while driving a primary or secondary offense. It’s proposed to be a primary offense, which means that police officers would be able to pull over a driver just for cell phone use. Secondary traffic offenses are only enforced if there is some other reason to pull a driver over.

Responding to a question from Rapundalo, chief of police Barnett Jones said it was important that it be a primary offense, because it would allow them to begin to “harden the community” against the behavior. Jones cited a 2003-04 statistic that attributed 24,000 traffic deaths nationwide to cell phone use while driving. He characterized it as a major safety hazard.

Chief Jones allowed that he himself has switched to hands-free Bluetooth technology for use while driving. Taylor picked up later on the hands-free versus hand-held distinction, and pointed to Green’s research conclusion that the distraction arises not because the hands are occupied, but because the mind is occupied. So Taylor wanted to know how the ordinance might be enforced, if the exception for hands-free use were not made in the ordinance. [The ordinance language provides for a number of exceptions, hands-free devices among them.]

Jones said that without the exception, it would put officers in a very prohibitive position. In that case, he said, they should consider going the whole way, and address people applying lipstick and eating cheeseburgers as well.

Marcia Higgins (Ward 4) said that if it was about safety, then “let’s go all the way.” She took a shot at the overall clarity of the language, asking, “Was this written up by the attorney’s office?” When city attorney Stephen Postema acknowledged that it had been written up by his office, she told him that she had to break down the paragraphs to understand what it meant.

Higgins asked Jones if other non-driving tasks were prohibited under other aspects of the vehicle code. Jones allowed that something like applying lipstick while driving could be enforced as “careless driving.” Higgins wanted to know why use of a cell phone while driving could not be handled the same way. Jones said that having an ordinance with specific language addressing cell phones made it “cleaner in a court of law.”

Higgins also asked about the burden of proof. In the case that a driver offers a defense that they were using a device in a hands-free manner, the burden of proof falls to the driver.

Stephen Kunselman (Ward 3) wondered what the difference was between holding an iPhone with a map displayed on it – which seemed to be prohibited – versus holding a paper map. Green clarified that the ordinance as written allowed someone to look at an iPhone map, but not to enter the destination.

Taylor came back to the data entry question by focusing on the “or otherwise operate” phrase in the ordinance. If the concern was typing, he said, they should talk about typing. Green clarified that the “or otherwise operate” phrase was meant to prevent the pressing of the various buttons to select “points of interest” from the map, which entailed reading through detailed menus of options.

Sandi Smith (Ward 1) said she had trouble with the ordinance – she’d prefer to see it done at the state level. She said she appreciated the efforts and the work of those who’d put time into the ordinance, but she felt it should happen in the context of the Michigan State Vehicle Code. Rapundalo had mentioned earlier that violations of the local ordinance would not result in points added to a driver’s license – because there’s no analogous state statute.

Hiefte said he thought that the work on the ordinance, with the changes that had been made to the ordinance since its first introduction, was a good example of the process working to produce a better piece of legislation.

Outcome: The ordinance banning cell phone use while driving or cycling was approved on first reading with dissent from Higgins and Smith. Enactment will be contingent on approval at a second reading.

Planned Unit Development (PUD): The Moravian

Planned unit developments are requests for rezoning of a parcel to accommodate projects that offer a public benefit in exchange for the rezoning. They are, stressed Stephen Kunselman on Monday night, discretionary on the part of the city council. They contrast with “by right” proposals that meet all aspects of city code. Kunselman also offered a tweak of the interpretation of the letters PUD – “promises until developed” – an allusion to the fact that a number of PUDs have been granted, but never built.

The Moravian is an almost 75,000-square-foot, four-story building over one level of parking containing 62 dwelling units, with a combined total of 150 bedrooms, and 90 off-street parking spaces. Twelve of the 62 proposed dwelling units are to be for affordable- to lower-income households. The project is located on East Madison Street, between Fourth and Fifth avenues.

Moravian: Public Comment

Several people signed up to comment during reserved time at the start of the meeting, but not all of them appeared. Speculation called out from the audience suggested some might have had problems finding parking or that they thought their speaking time was at the end of the meeting.

Beverly Strassmann, president of the Germantown Neighborhood Association, touched on a number of points speaking in opposition to the project. She contended that since the year 2000, 41 projects had been approved by the city that had not begun construction – for example, 601 S. Forest, Ann Arbor City Apartments, Broadway Village, and Kingsley Lane. She noted that there was a high percentage of vacancy in developments targeting student renters – 411 Lofts and The Courtyards, for example.

Strassmann also emphasized that South Fifth Avenue is a major commuter artery and that it needs to flow smoothly. The addition of 150 more bedrooms and 90 parking spaces, she feared, would cause ingress/egress problems. She was also concerned about the net effect on affordable housing, saying that while The Moravian offered 12 units of affordable housing, 19 units would be lost.

Shirley Zempel characterized The Moravian as “huge.” The building goes right up to the sidewalk on three sides, she said – Fifth Avenue, East Madison Street, and Fourth Avenue. She echoed the point Strassmann had made about the impact on traffic along Fifth, saying she’d have difficulty pulling out of her own driveway.

Kim Kachadoorian stressed the idea that The Moravian was not in downtown, but rather near downtown. She cautioned the council that some of the renderings provided by the developer showed surrounding houses with 5-6 stairs leading up to their front porches, when in fact they had 3-4 stairs. This left the impression that the houses were taller than they are, she said. Kachadoorian also contended that one rendering of The Moravian depicted the 5-story building as the same height as a 3-story University of Michigan building across Fourth Avenue from The Moravian. She cautioned against giveaways for developers.

Claudius Vincenz also stressed that The Moravian was not in downtown, but rather near downtown. He characterized the city staff report as deficient and biased. He said that when reading through the staff report, he thought it was the developer’s application. He objected to the fact that the planning commission had referred to some houses in the the neighborhood with the word “dumps.” He allowed that they are not mansion-type houses, but that they are affordable.

Richard Jacobson spoke during public commentary general time at the conclusion of the meeting. He stressed that based on the PUD review standards, a request should not be granted if the request is made in order to circumvent existing zoning. Jacobson contended that the project, in fact, was an attempt to circumvent existing zoning standards. He characterized the housing offered as “private dorms.”

Anne Eisen also spoke at the conclusion of the meeting. She asked the council to read carefully the planning commission minutes. What the developer characterizes as support from neighbors is, in fact, not support, she said.

Kyle Mazurek, vice president of government affairs for the Ann Arbor Area Chamber of Commerce, spoke on behalf of that organization as well as himself, a young professional living in Ward 5. He ticked through a number of benefits provided by the project: higher density development of the downtown area, expansion of workforce affordable housing opportunities in the downtown area, removal of blighted structures and obsolete industrial buildings, floodplain mitigation, property tax revenue to the city, enhanced housing options for young professionals, encouragement of alternative modes of transportation, enhancement of downtown area businesses and energy efficiency.

At the conclusion of the council meeting, speaking during public commentary general time, the developer of the project, Jeff Helminski, addressed the council saying that he recognized the challenge they faced in analyzing such a complex project, which had taken two years to bring to this point. He encouraged the council to rely on the city’s professional planning staff as well as the PUD standards of review. Responding to Strassmann’s concerns about approved projects that had not yet been built, he said he was confident that he could bring the project to fruition.

Responding to a report Mike Anglin (Ward 5) had given during his communications that he’d found studio apartments in the neighborhood that rented for $760 including utilities, Helminski stated that the affordable units in The Moravian would rent for no more than $690, and that their affordable status was assured in perpetuity through the supplemental regulations of the PUD. Addressing concerns about the FEMA flood maps that had not been finalized, he contended that the data was final and that The Moravian had been planned based on that data. What they were waiting for, he said, was the final publication of the maps based on the data.

Moravian: Council Deliberations

At the caucus held the previous evening, on Sunday, Beverly Strassmann, president of the Germantown Neighborhood Association, indicated that a protest petition would be submitted against The Moravian. That would raise the bar for council approval from six to eight votes out of 11.

Jeff Helminski, developer of The Moravian, chatted with Margie Teall (Ward 4) before the council meeting started.

On Monday, Stephen Kunselman (Ward 3) responded to a resident request made at the previous night’s caucus to give some clue at the first reading as to how councilmembers were thinking about the project: “I’ll be voting against it at second reading – so there’s no question in the community’s mind,” he said.

At the council table on Monday, Carsten Hohnke (Ward 5) and Mike Anglin (Ward 5) made remarks that could fairly be interpreted to mean their support at second reading is uncertain. Sabra Briere (Ward 1) read from two contrasting passages in the city’s central area plan to illustrate the conflicting concerns that surround council’s evaluation of the project.

Council deliberations began with Hohnke alluding to another project in roughly the same neighborhood, Heritage Row – which began life as City Place. The council had voted down the City Place PUD a little over a year ago. Hohnke said he imagined that residents were getting a bit weary. He characterized the conversation about what kind of development is appropriate for the neighborhood as a “long slog.”

On the question “What is downtown?” Hohnke said it was clear for him: The downtown boundary is William Street. That meant, said Honhke, that the neighborhood under discussion – which lies south of William – is not downtown. So Hohnke said that many of the considerations for added public benefit offered by The Moravian – based on what’s called for in the downtown (e.g., added density) – did not carry a lot of weight with him. Hohnke concluded that the benefits required of a PUD were a significant threshold that had to be met, given that the city would be setting aside the existing zoning on the site.

Mike Anglin (Ward 5) reported that there had been an extended discussion at the previous night’s caucus and that he had a whole series of questions that he would be circulating by email. Among his concerns: statements by neighbors that had been misrepresented by the developer; the number of projects in the city that had been approved, but not started; flood maps that had not yet been issued.

During his communications time earlier in the meeting, Anglin said he’d walked the neighborhood and found a house with three studio units for rent: $760 including utilities. He questioned whether it was possible to build new construction that was equally affordable.

Marcia Higgins (Ward 4) picked up on the issue of flood maps, and Wendy Rampson, head of planning for the city, confirmed that no permits could be pulled until the FEMA flood maps were finalized, which would potentially be within the next year.

Sandi Smith (Ward 1) said she’d vote yes at first reading so that the dialog could continue. She allowed that the Downtown Development Authority’s taxing district is one way to define downtown. But she noted that the neighborhood in question was near downtown. She noted that there’d been a lot of time spent discussing what is appropriate in a near downtown neighborhood. One of those issues, she said, involved whether parking meters were appropriate there. [Smith has worked since last year to forestall installation of parking meters in neighborhoods near downtown, which were seen as a potential revenue source.]

Smith noted that they were getting pushback from people who also objected to development in the center city – they wanted the top of the Library Lot to be established as a park.

Tony Derezinski (Ward 2) noted that the role of the first reading was to introduce a topic to the public, but that in this case, “it’s like introducing Methuselah.” Derezinski, who serves as the city council’s representative to the planning commission, had already seen the project in a fair amount of detail when it was reviewed by that body. Derezinski stressed that the city’s professional planning staff had put a lot of time into the project. He said that you have to pay serious attention to staff recommendations – city staff had recommended approval, and the planning commission vote was 7-1 in favor. He urged his council colleagues to really read the staff report so that the project got a fair hearing.

Margie Teall (Ward 4) echoed Derezinski’s sentiments, saying that the DDA boundary was artificial – the site in question was an urban neighborhood in an urban setting, she said.

Stephen Kunselman (Ward 3) suggested that for a project to take two years to come forward, it meant that there was likely something wrong with the project. He said he thought the project was out of context and character for the neighborhood and did not do much for “more doors on the street.” He felt that it was geared towards students. It was like taking The Courtyards housing development on the north end of Broadway, he said, and “plopping” it near downtown. He said he’d vote for it at first reading, but would oppose it at the second reading.

Sabra Briere (Ward 1) said she was not quite as definitive – she said she’d hate to cut off debate this early. She said she’d not looked at the project in detail, yet. Instead, she said, she’d oriented herself to the city’s central area plan and the PUD regulations [.txt file of PUD review standards].  She’d done that, she said, as a response to the challenge that had been made at the previous night’s caucus by Eppie Potts to give some clue what the council was thinking. Briere said it had caused her to reflect on what one should say at a first reading, when the council is just moving the process forward.

The standards for PUD review referenced by Briere, contained in the city code and presented here in severely abbreviated form, are as follows:

(6) Standards for PUD zoning district review. The commission shall recommend approval, approval with conditions, or denial, and City Council shall approve or deny the proposed PUD zoning district based on the following standards:

(a) The use or uses, physical characteristics, design features, or amenities proposed shall have a beneficial effect for the City, in terms of public health, safety, welfare, aesthetics, or convenience, or any combination thereof, on present and potential surrounding land uses. …

(b) This beneficial effect for the City shall be one which could not be achieved under any other zoning classification and shall be one which is not required to be provided under any existing standard, regulation or ordinance of any local, state or federal agency.

(c) The use or uses proposed shall not have a detrimental effect on public utilities or surrounding properties.

(d) The use or uses proposed shall be consistent with the master plan and policies adopted by the City or the petitioner shall provide adequate justification for departures from the approved plans and policies.

(e) If the proposed district allows residential uses, the residential density proposed shall be consistent with the residential density recommendation of the master plan, or the underlying zoning when the master plan does not contain a residential density recommendation, unless additional density has been proposed in order to provide affordable housing for lower income households …

(f) The supplemental regulations shall include analysis and justification sufficient to determine what the purported benefit is, how the special benefit will be provided, and performance standards by which the special benefit will be evaluated.

(g) Safe, convenient, uncongested, and well-defined vehicular and pedestrian circulation within and to the district shall be provided and, where feasible, the proposal shall encourage and support the use of alternative methods of transportation.

(h) Disturbance of existing natural features, historical features and historically significant architectural features of the district shall be limited to the minimum necessary to allow a reasonable use of the land and the benefit to the community shall be substantially greater than any negative impacts.

The passages from the city’s central area plan, which Briere read aloud, were these:

[page 21] Finally, the current zoning does not provide guidelines for what is appropriate density in relationship to the area, and it does not reflect density differences between the various neighborhoods.  The ordinance allows more bulk and density than many neighborhoods want or consider appropriate.  Conversely, the City Council and Planning Commission have steadily decreased allowable density since the 1960s, making it difficult for residential infill development to occur, resulting in nonconformities.

[page 41 ] In various locations around Ann Arbor, houses are overshadowed by larger commercial, residential or institutional buildings that are out of scale with existing surrounding development. In addition to being aesthetically displeasing, out-of-scale construction alters the quality of living conditions in adjacent structures by blocking air and light and by covering open green space with excessive building mass.

Outcome: The Moravian was given approval on first reading. Final approval would need to be given at a second reading.

Present: Stephen Rapundalo, Mike Anglin, Margie Teall, Sabra Briere, Sandi Smith, Tony Derezinski, Stephen Kunselman, Marcia Higgins, John Hieftje, Christopher Taylor, Carsten Hohnke.

Next council meeting: Monday, March 15, 2009 at 7 p.m. in council chambers, 2nd floor of the Guy C. Larcom, Jr. Municipal Building, 100 N. Fifth Ave. [confirm date]

Almost a year ago, on March 23, 2009, Advance Publications announced that it would shut down The Ann Arbor News later that year. Ann Arbor Chronicle publisher Mary Morgan wrote a column about that announcement: “Why We Grieve The Ann Arbor News.”

James "Jay" T. Hamilton's book, "All the News That's Fit to Sell" is available on Amazon.com. (Image links to Amazon)

It would be fitting and proper to think back and reflect, ponder, and meditate again on the closing of The Ann Arbor News. But in that column, Mary writes about “moving toward a future in which the landscape of [her] life has unalterably shifted.”

So this month’s Milestone is more about moving forward than looking back. And that’s one reason we’re throwing Chronicle readers a curve ball: Flouting the usual alternating batting order for editor and publisher, I’m stepping to the plate two months in a row to take a hack at the Monthly Milestone.

To make this column easier to read, I’ll tell you what’s coming – I’ll be concluding with a straight sales pitch. [If you're not a fan of baseball then, for crying out loud, be a fan of spring ... spring training games start in a few weeks.]

The pitch I’ll make is informed by a trip I made to Washington D.C. a couple of weeks ago. At the invitation and expense of the Miller Center of Public Affairs at the University of Virginia, I attended a session of the working group they’ve established there on media and governance. It’s a group that includes representatives of the Federal Trade Commission and the Federal Communications Commission – they’ll be putting together a report for Congress on existing and new media, and their role in providing information on governance issues.

I shared with the group our experience here at The Ann Arbor Chronicle. But greater than any value I provided to them, I’m certain, is the value I took away from the meeting. This column is mostly what I learned from Duke University professor of political science and economics, James “Jay” Hamilton, who had also been invited to address the working group.

Before diving into Hamilton’s presentation, here are some bullet points extracted from the briefing memo on the Chronicle, which I’d prepared for the Miller Center working group. I drew a distinction between newer online readers of news and information and “veteran” online readership – people who’ve been reading, writing, commenting online and using tools like browser bookmarks and RSS readers for the better part of the last decade:

Expectations of Veteran Online Readership

• Rapid access to information. Getting the nugget of news fast is really important to these readers. Why? Because technology makes it possible.
• Simple and brief presentation. We’re told repeatedly that, according to market research, people don’t want to read more than a hundred words at a time. Why? People value breadth. It’s a function of the technology – when there’s such a huge volume of information accessible using digital technology, it fuels a need to condense, and summarize.
• Unfettered ability to express opinion everywhere. Robustness of comment threads are seen as a metric of success. Readers expect online publications to invest considerable resources in managing and moderating comments.

Flouting Expectations of Veteran Online Readership

The Chronicle flouts each of those expectations. Some specific examples:

• We’re slow. A story we write about a city council meeting on Monday evening might not be published until Thursday.
• We’re verbose. We’ll write 4,000 words about a meeting of the Downtown Development Authority.
• We don’t care much (only some) about comments.

In the briefing memo, I outline how the same technology that underpins the expectations of veteran online readers also allows us to pursue our editorial mission. One example is the fact that for an online-only publisher, there is no “news hole” to fill on a printed page. From the point of view of technology, then, there is no pressure for a typical story to be published any sooner than when the reporter is done writing and an editor is done editing it.

But does it pay to be slow and verbose? Or rather, can it pay to be slow and verbose? This is the kind of question that Prof. Hamilton, as an economist, is equipped to illuminate. Hamilton’s book, “All the News That’s Fit to Sell” certainly helps shed some light on it.

One of the first observations that Hamilton made at the working group meeting was this, though he did not phrase it exactly this way: You can sell the same news online that everyone else is selling, but only if you’re willing to set the price at zero.

Here’s why. Let’s say that companies selling news and information decide to restrict the availability of that news and information to those who pay them for it. For online publishers, this means setting up a system – a “pay wall” – that prevents readers from getting access to articles on the website unless they pay for that access. Once that system is in place, what is the cost to the company of adding one more customer?

It’s basically zero. That’s partly a function of the fact that news and information is a public good, not a private good like a glass of water. Public goods, like news and information, can be consumed by multiple people without preventing other people from consuming those goods. A private good like a glass of water is not available to others once I drink it.

So the cost of adding one more customer to an online pay-for-news system is zero – you don’t have to produce “more of” an online news article in order to accommodate additional readers. This cost of adding one more customer is what economists call the “marginal cost” of production. And that’s important, because in terms of economic theory, here’s something that economists know: In a perfectly competitive market, price will equal marginal cost. So a realistic estimate is that the price of online news and information will equal the marginal production cost … zero.

One point that Hamilton highlighted is that this conclusion is “path independent.” That is to say, the reason the price for online news and information has to be zero is not because people have over the years come to expect free access and it’s too late to change their habits. Otherwise put, it wouldn’t make any difference if we went back to the early days of the Internet and established, by convention, that all content must be protected behind a pay wall. An economic theory of online news and information suggests we’ll always get a market where price equals zero.

Conclusion: You can’t charge a price for online news and information in a competitive market.

Even though we don’t and won’t charge a price for Ann Arbor Chronicle content, there’s an important lesson here. The conclusion that price equals zero depends on the idea that the market is competitive. It’s only a perfectly competitive market if every producer of news and information is offering the same news and information. It’s therefore in The Chronicle’s best interest – from the point of view of economic theory – to continue to offer our readers the kind of detailed and comprehensive coverage that we do, because it’s not available elsewhere.

But readers don’t think in terms of economic theories. Readers have information demands, and their willingness to pay for information hinges on whether their demands are being met. Hamilton distinguishes among four kinds of information demands – those of consumers, producers, entertainment seekers, and voter/citizens.

By consumers, Hamilton means people who are thinking of purchasing some product, and are looking for information about which merchants are offering it for the cheapest price, or about which product has the best safety record. Information about cheapest price or safety represents a benefit to consumers they can’t otherwise get. By producers, Hamilton means people who need the information to do their jobs. If it’s your job to look for legal precedents, you would get a benefit from having access to information about court cases. By entertainment seekers, he means mostly what it sounds like – information that provides the benefit of being simply fun.

So for the first three categories, it’s pretty clear that you don’t get the benefit if you don’t get the information. And if you want the benefit, you might be willing to pay for the information.

But what about voter/citizens? What benefit do they get from the information that might be available? Here, Hamilton draws on the work of Anthony Downs in describing “rational ignorance” – it might be perfectly rational not to  invest time and effort in  becoming better informed about civic and public affairs. Becoming better informed about public affairs offers only a small prospect to an individual of getting a benefit – say, of affecting public policy through their one vote.

So what kind of person does perceive a benefit from getting  public affairs information? Hamilton identifies three Ds: (i) people who get a benefit because they feel it’s their duty; (ii) people (political junkies) who benefit from the information because it’s a diversion; and (iii) people who enjoy the drama surrounding such information.

If the three Ds are the kind of people who might be willing to pay for information about civic affairs, then the bad news is that the three Ds are a fairly small set of people.

Here’s two reasons I do not see this as a dream-crushing fact. First, there’s an additional, fourth D that makes the set of people a little bit bigger: People who want to delegate the work of being informed about civic affairs to someone else. These are people who take comfort from knowing that someone is attending the meetings of public bodies and writing down what’s said and making some kind of sense of what happens there.

Second, a locally-based news organization like The Chronicle doesn’t require the kind of massive infusion of revenue needed to sustain layers of executive management and a financial return for out-of-town owners.

Still, our revenue needs to grow, in order to bring additional working journalists on board and to ensure that The Ann Arbor Chronicle will persist as a permanent part of the Ann Arbor media landscape – even after its local owners’ eventual demise. Revenue from Chronicle voluntary subscriptions helps support owners who are themselves working journalists, as well as our freelance writers.

To all Chronicle readers who have already subscribed voluntarily: Thank you. To those Chronicle readers who prodded us to make subscribing voluntarily an option: Thank you. To those Chronicle readers who suggested that what we should be selling is journalism: Thank you.

And to those readers who opt to subscribe voluntarily now: Thank you.

That’s my pitch. Play ball!

At the Sunday Ann Arbor city council caucus, from left: Tony Derezinski (Ward 2), Stephen Kunselman (Ward 3) and Sabra Briere (Ward 1). Also attending the caucus from the city council were Mike Anglin (Ward 5) and John Hieftje (mayor). (Photo by the writer.)

Due to receive its first reading on Monday night at the council’s regular meeting is The Moravian – a  five-story residential and work/live space planned unit development (PUD) along the 500 block of Fifth Avenue and the 200 block of East Madison. The project was given a recommendation for approval from the city’s planning commission on a 7-1 vote in January 2010. [Chronicle coverage: "Moravian Moves Forward Despite Protests"]

At Sunday’s caucus, some residents said they were keen to see a substantive discussion at The Moravian’s first reading, but councilmembers cautioned that the first reading was typically not the time when they argued a particular position. Residents indicated that they’d gathered enough signatures from surrounding land owners to meet a city code threshold that would force an 8-vote super-majority – out of 11 votes – at a second reading of the PUD proposal.

Also receiving a first reading on Monday will be a proposed ban on cell phone use while driving. The ban had already received approval on first reading at the council’s last meeting, but due to subsequent significant revisions to the ordinance language, it will be heard again Monday as a first reading. The council’s agenda indicates that the public hearing, generally held along with an ordinance’s second reading, has been canceled. That will be rescheduled to coincide with the second reading.

A budget directive – reducing all non-union staff salaries by 3% – had been postponed from the last council meeting and will be considered by the council on Monday in a slightly revised form. As a council resolution – as opposed to an ordinance – it will require just one reading. A key revision in the intervening postponement: It’s now a minimum 3% cut that’s specified, which leaves the door open for even greater cuts.

Background: First, Second Readings and Petitions

Why do ordinances require two readings before city council in order to be enacted? It’s a requirement of the city charter:

SECTION 7.3.
…
(b) Each proposed ordinance shall receive two readings, which may be by title only, unless ordered by the Council to be read in full or in part. After the first reading of a proposed ordinance, the Council shall determine whether it shall be advanced to a second reading. The second reading shall not be given earlier than the next regular Council meeting.

The Moravian, as a planned unit development (PUD), requests a change in the city’s zoning – zoning districts are a part of the set of city ordinances and are recorded in Chapter 55 of the city code.

The zoning of parcels surrounding The Moravian also came up in discussion at Monday’s caucus, because those parcels factor into a calculation for protest petitions that can be filed against a PUD. Chapter 55 Article XI, Section 5:107 (5) specifies that [emphasis added]:

(5) A protest against any proposed amendment to this chapter may be presented in writing to the City Clerk at or before the public hearing thereon. Such protest shall be duly signed by the owners of at least 20% of the area of land included in the proposed change, or the owners of at least 20% of the area of land included within an area extending outward 100 feet from any point on the boundary of the land included in the proposed change, excluding any other publicly owned land. Following the filing of a valid protest petition, adoption of an amendment to this chapter shall require at least 8 affirmative votes of the Council at the second reading on the ordinance.

Beverly Strassman, who is president of the Germantown Neighborhood Association, contended at Sunday’s caucus that the city clerk’s office had thus far declined to accept the petition that had been prepared against The Moravian – apparently on the grounds that the first reading on The Moravian had not yet taken place. Strassmann was concerned that the petition would not be accepted in time to have an impact. Councilmembers at caucus assured her that they’d check into the petition submission issue.

Aerial view of The Moravian, looking northeast. A computer-generated image of the proposed project is located in the center of this picture – the U-shaped building. The South Main Market complex is in the foreground; Perry School, now used as offices by the University of Michigan, is to the upper right. (Image links to higher resolution file.)

Strassman’s other concern about the petition was that the University of Michigan-owned building across Fourth Avenue, east of the proposed The Moravian, was inappropriately zoned as M1, which is “limited industrial district,” not PL, or “public land.”

If it were zoned as public land, she said, it would not factor into the land area calculation for the protest petition, making it easier to meet the 20% threshold – on the assumption that UM would not sign. [Editor's note: The Chronicle's reading of the code requirement on the protest petition is that the university property would properly be excluded, because it is "publicly owned." The code requirement on petitions does not say "zoned as public land."]

On the issue of whether the university-owned building was currently improperly zoned as M1, Stephen Kunselman (Ward 3) weighed in saying that actual land use was different from zoning – the zoning might well be different from the land’s actual use.

Kunselman queried Strassmann as to whether she had enough signatures even without the UM property, and she indicated that she did. However, she was not able to give an estimate of what percentage had been achieved.

Past Protest Petitions: City Place

About a year ago, the same kind of protest petition had an impact on the City Place PUD north of Packard on Fifth Avenue, but in the same general neighborhood as the The Moravian. [Chronicle coverage: "Residents Organize to Defeat City Place"]

The petition not only raised the number of votes necessary for approval to eight – the fact of the petition caused councilmembers who’d been inclined to vote for the project to change their thinking. At a Sunday caucus on July 19, 2009, some months after the City Place vote in January, Christopher Taylor (Ward 3) allowed that he’d come to the City Place vote inclined to support the project, but the fact of the petition had given the neighborhood opposition to the project greater clarity.

The vote against City Place was thus 10-0 – the council had had six likely votes in favor of the project, but not the eight needed to make it stick. [Sandi Smith (Ward 1) did not attend that meeting.]

The Moravian: Due Process and Deliberations at First Reading

At Sunday’s caucus, Beverly Strassmann, president of the Germantown Neighborhood Association, asked the council not to approve The Moravian for a second reading but rather to send the developer back for a public participation meeting. Why? In January 2009, an ordinance took effect that the council had approved, which requires developers to hold a meeting with neighbors of proposed developments and submit a report on that meeting with their site plan submission.

It was that report that Strassmann had a problem with. She contended that the representations in the report were “fraudulent” and thus could not possibly satisfy the ordinance requirement. She said she took issue with the characterization of herself as “verbally abusive” and reported that other residents at the meeting also felt that their comments had been misrepresented by the developer. One of the meetings described in the report, Strassmann said, took place on Dec. 23, 2008. [Chronicle coverage of the Dec. 23 meeting: "The Madison Redux"]

Stephen Kunselman (Ward 3) commented that this was the nature of the public participation ordinance – it was up to the developer to hold the meeting and to write the report. Kunselman said he wasn’t so concerned about the he-said-she-said aspect. Rather, his main question was whether the objections of Strassmann and others to the content of the report had been established as a part of the public record. Strassmann indicated that at least one resident, Walt Spiller, had registered his objections at the planning commission’s public hearing, but she was uncertain whether that had been included in the commission’s minutes.

Mike Anglin (Ward 5) used his laptop computer to retrieve the minutes and read aloud:

Walt Spiller, 548 South Fifth Avenue, adjacent homeowner to the north, asked that appropriate buffering be provided between his property and this project. He believed the petitioner’s representation of his comments were a misinterpretation, adding that he told the petitioner he would not bring this up in a public forum if the petitioner would redact the entire statement under his name. It was not done, he said. His main opposition to this proposal was that it was out of scale and character with the existing neighborhood.

Sabra Briere (Ward 1), who had helped push forward the passage of the still relatively new public participation ordinance, noted that it was due for an annual review and that the issue of a report’s content should be included in its review. [The ordinance took effect in January 2009.] The question of when additional meetings are triggered is also something she said should be reviewed – city staff were interpreting the ordinance’s reference to “amended planned unit development zoning district” in a way that didn’t include all changes, she said. [Related Chronicle coverage: "Heritage Row Redux: Process Clarified"]

Jack Eaton, responding to Strassman’s use of the word “fraud,” suggested that the council focus attention away from that word and instead focus on the idea that the public participation ordinance should be taken seriously. He suggested that one way to achieve that at Monday’s first reading would be to ask the developer to amend the report on the public participation meeting to reflect residents’ comments accurately.

At Sunday’s caucus, many of the same concerns  were expressed about The Moravian that neighbors had conveyed at the planning commission’s meeting: the building was out of scale with the neighborhood; the building would create shadows on surrounding buildings; 5th floor terraces should not count as open space. Strassmann summarized the way she felt the planning commission had treated the developer: “Planning commission has coddled the developer as if he was breastfeeding.” [In early 2006, the city council passed a revision to Chapter 112 of the city code that makes explicit a mother's right to breastfeed in places of public accommodation.]

Briere, responding to concerns raised by Strassmann that there was no actual brownfield on The Moravian site, told Strassmann that brownfields did not necessarily require that there be pollution – “urban blight” was sufficient. And someone could decide that there was “urban blight,” Briere said, even though you might not agree that it was blighted. Briere drew upon her experience with a proposed development near her neighborhood – the Lowertown development near Broadway – in providing the explanation to Strassmann.

The Moravian is an almost 75,000-square-foot, four-story building over one level of parking containing 62 dwelling units, with a combined total of 150 bedrooms, and 90 off-street parking spaces. Twelve of the 62 proposed dwelling units are to be affordable to lower-income households.

Ethel Potts, a resident of Ward 5, expressed her hope that the council would use their deliberations at the first reading of The Moravian to give the public “some clue” as to how they were thinking about the project. Sabra Briere (Ward 1) indicated that she tried to keep a really open mind at first reading and avoided getting to an actual decision until “the last possible moment.” She also told Potts that she felt the council had done a better job recently of discussing things at first reading.

Stephen Kunselman (Ward 3) indicated that The Moravian looked to him to be very similar to The Courtyards, a development near UM’s north campus at 1780 Broadway.

Mayor John Hieftje compared the process to the evaluation a jury makes and that it was important not to make a decision until all the evidence was in.

Tony Derezinski (Ward 2), a former state senator, said that was a similar pattern in the state legislature. The first reading, said Derezinski, basically alerts the public that the issue is now before the public body.

Cell Phones: Back to First Reading

At their last regular meeting on Feb. 16, 2010, the city council approved at its first reading a ban on cell phone use while driving. Tony Derezinski (Ward 2) noted that the discussion at their deliberations and feedback from residents – he’d received at least 40 emails – had reflected the usefulness of the first reading. Since then, the ordinance has undergone significant and numerous revisions, so that on Monday, it comes before council again as a first reading. [.txt file of original cell phone ordinance; .txt file of revised cell phone ordinance].

Mayor John Hieftje said that some of the revisions, allowing exceptions involving public emergency drills, had been prompted by resident input. From the revised ordinance:

(e) the person uses the electronic device while performing his or her duties as a volunteer in the Radio Amateur Civil Emergency Service (RACES) created by the Federal Emergency Management Agency and the Federal Communications Commission and as provided for in Title 47, Part 97, Subpart E, Section 97.407 of the Code of Federal Regulations.

Budget

Caucus conversation touched on a number of budget-related issues.

How Is This Paid For?

Sabra Briere (Ward 1) noted that the Monday agenda provided a number of “opportunities to spend money.” So she floated the idea to her council colleagues that the fund from which the money would be drawn be included on the agenda, so that the public would have a clearer understanding of where the money came from. Mayor John Hieftje said he thought that was not a bad idea.

The 3% Budget Directive

Postponed from the council’s last regular meeting, on Feb. 16, 2010, and now coming before the council on Monday, is a resolution directing the city administrator to cut non-union salaries by 3%. The resolution has been revised in the interim. [.txt file of original budget directive; .txt file of revised budget directive].

At Sunday’s caucus, Briere characterized a key difference between the two versions as the requirement that the cut be a minimum of 3%, which highlights the possibility that the cut could  be greater than 3%. In a “budget white paper,” circulated to residents, Briere has suggested specifically that for top management positions, the amount of the cut could be greater – as much as 10%. [.pdf file of Briere's budget white paper]

The Municipal Service Charge

Leslie Morris attended caucus and reflected on her service on the Ann Arbor city council from the mid-’70s through the early ’80’s and subsequently on the city’s park advisory commission. She told councilmembers that she was there to talk about golf,  though she had never been a golfer. She recalled how a park open space plan from 1966, in its first sentence, had identified a new golf course as the city’s greatest park need. She noted that there was no supporting material or data in the plan for that statement. She attributed it to the fact that the Leslie family was interested in selling the land to the city that is now the Leslie Golf Course – on “very favorable terms” to the city, she said.

Mayor John Hieftje clarified that for the land where the Leslie Science and Nature Center is located, it was a donation, and that for the golf course it was $1,000 per year.

Morris noted that during her period of public service, they had always felt that golf should pay its own way. But sometime in the ’90s, she said, golf was separated from the general fund, with the result that there were charges made “to ourselves” for golf that were not applied to other recreational activities. She characterized the situation that the city had gotten itself into as not quite fair.

Stephen Kunselman (Ward 3) noted that the municipal service charges made to different service units was what Morris meant by “charging ourselves.” He said that unclarity on this charge was one reason the council had asked city staff to explain it more clearly at an upcoming meeting on the budget, on March 8.

Hieftje said that when he was first elected to city council in 1999, he had heard that the reason the golf courses were separated out from the general fund was to “protect” them. Kunselman agreed that this rationale was based on the idea that if the golf courses were making money, then they would be “milked.” Kunselman suggested that the city’s municipal service charge was, in fact, a way of “milking” the golf courses.