Stories indexed with the term ‘tax abatement’

Ann Arbor city council meeting (Feb. 24, 2014): Mayor John Hieftje welcomed high school students attending the meeting to satisfy course requirement by telling them they were probably getting off easy compared to other nights.

That’s because the meeting was a special session, dealing with just one substantive issue: a resolution to exercise the city’s right of first refusal to purchase the 16.7 acre Edwards Brothers Malloy property on South State Street, and a closed session to discuss that issue.

The council’s 5-6 vote on the land acquisition fell short of a simple majority, let alone the 8-vote majority it needed. That vote came after the closed session, which lasted an hour and 40 minutes. The council then deliberated for about an hour and 10 minutes.

The council’s decision came four days after the University of Michigan’s board of regents had authorized proceeding with a purchase of the property for $12.8 million. The site is located at 2500-2550 South State Street, immediately adjacent to existing UM athletic facilities. It’s assumed the university would use the land at least in part to support its athletic campus.

Voting to exercise the right of first refusal were: Sabra Briere (Ward 1), Sally Petersen (Ward 2), Jane Lumm (Ward 2), Margie Teall (Ward 4), and mayor John Hieftje.

Voting against exercising the right of first refusal were: Sumi Kailasapathy (Ward 1), Christopher Taylor (Ward 3), Stephen Kunselman (Ward 3), Jack Eaton (Ward 4), Chuck Warpehoski (Ward 5) and Mike Anglin (Ward 5).

Deliberations focused on two main issues: (1) the financial risks and benefits; and (2) the city’s relationship with the university.

The motivation for the city to exercise its right of first refusal on the property was based in large part on a desire to protect the city’s tax base. The property current generates roughly $50,000 in annual real property tax revenue to the city’s general fund. But the city’s total revenue from the parcel is just 28% of the total taxes levied by all jurisdictions. The net present value over the next 25 years of the levy from all jurisdictions is roughly $6 million. That was weighed by the council against a purchase price of $12.8 million that reflected a “premium” over the appraised value of around $8 million.

Also a factor weighed by the council was a $218,000 annual holding cost for the land, which reflected a 1.7% interest rate that Flagstar Bank had offered. That’s about half the rate the council was assuming in its earlier review of its options.

Another piece of the financial equation was that the some of the tax abatement previously granted by the city to Edwards Brothers would be coming back to the taxing jurisdictions. That’s because by selling the property, Edwards Brothers would not be meeting all the terms of the tax abatement. There’s a clawback provision in that case – which returns taxes to jurisdictions amounting to a total of $200,000. Of that total, the city’s portion is $90,000. It’s under the terms of that tax abatement that the city had obtained a right of first refusal on the sale of the property.

The deal would have been financed from the general fund. According to the city’s year-end audited statements for FY 2013, the general fund unassigned balance stood at $14,392,854 as of June 30, 2013.

Councilmembers like Eaton and Kailasapathy were clearly opposed to exercising the city’s right of first refusal, based on the substantial risk they thought the city would be taking. Everything would need to go right, in order for the city to come out ahead, they said. Kailasapathy indicated that the “premium” price to be paid by the city for the real estate was a significant reason to vote against it.

Kunselman, in voting against the resolution, relied on what’s become for him a familiar criticism of “speculative development.” He cited in part what he’d learned taking a course on real estate from local developer Peter Allen, a lecturer at UM.

Councilmembers like Warpehoski and Taylor were less adamant about their no votes. Warpehoski thought the odds were “better than even” that the city would come out ahead long-term. But because the city would be gambling with public funds, he wondered if “better than even” was good enough. “Right now, I’m thinking maybe not,” he concluded. Earlier in the meeting Taylor had offered similar sentiments, saying that he’d “regretfully” vote no. “We could have pulled it off; we had a reasonable shot at pulling it off. In light of our mission, I think a reasonable shot is not good enough,” Taylor said.

The sixth vote against the resolution came from Anglin. He responded to one of the arguments made by those who supported the resolution – that by exercising its right of first refusal, the city could leverage some collaboration with the university on the future of the parcel. For Anglin, the price was too high just to sit at the same table with the university.

Petersen, Briere and Lumm specifically mentioned the ability to leverage some cooperation from the university on the future of the land as one argument for exercising the city’s right of first refusal. Kunselman called that trying to take the parcel hostage and holding a gun to the university’s head. But some who supported the resolution saw the possibility that exercising the right of first refusal could lead to improved city-university relations.

Hieftje ventured that the city-university relationship is as good now as it has ever been, adding: It’s a good relationship as long as things happen the way the university wants them to.

Those voting yes generally felt that the risk to the city posed by exercising the right of first refusal justified the potential benefit to the city’s tax base. They also cited the opportunity to control the future of the parcel, and to influence development in that part of the city. Responding to a remark from Warpehoski earlier in the meeting – that the South State Street corridor did not give him “warm fuzzies” – Teall said: “I like it. It’s my neighborhood.”

Some background information on the possible acquisition of the property by the city was released last week, on Feb. 18, the day of a regular council meeting. [Edwards Brothers chart] [Additional offer for Edwards Brothers] [Feb. 18, 2014 memo to council]

This article provides more background on the council’s handling of the issue, a sketch of the deliberations, and a more detailed presentation of the deliberations. [Full Story]

At a special session on Monday night, Feb. 24, 2014, the Ann Arbor city council declined to exercise Ann Arbor’s right of first refusal on the purchase of a 16.7-acre property owned by Edwards Brothers Malloy. The council’s decision came four days after the University of Michigan’s board of regents had authorized proceeding with a purchase of the property for $12.8 million.

… [Full Story]

Ann Arbor city administrator Steve Powers and city attorney Stephen Postema have been directed to gather information to help the city council determine whether to purchase the 16.7-acre Edwards Brothers Malloy property on South State Street.

The direction came after the city council met in a closed session for about half an hour during its Jan. 6, 2014 meeting, and then emerged to pass the resolution. [amended Edwards Brothers resolution on Jan. 6, 2014]

The resolution provides direction to explore options to make the purchase financially feasible. That means finding a way to finance a $12.8 million deal. The sale of the Edwards Brothers property on South State Street is currently pending to the University of Michigan for $12.8 million, in a deal that was … [Full Story]

Early in October, Barracuda Networks invited a bunch of University of Michigan students to a “hackathon” at the computer science and engineering building, where they programmed computers to play games against each other.

And 24 hours later, the winning team of programmers was handed one of those goofy Publishers-Clearinghouse-style giant checks – for $3,141.59. Second place was $1,414.21. And third place was $602.21.

Those dollar amounts might strike you as funny – because you think they make no sense, or because you think they make perfect sense. But a regular Chronicle reader might look at those numbers without laughing, and calculate as follows: The sum of the prize money is $5,158.01 – which divides perfectly (12 times) into the estimated 61,896.12 total value of a five-year tax abatement recently granted by the city of Ann Arbor to Barracuda. Uncanny, no?

It’s the tax abatement that has resulted in relatively frequent mentions of Barracuda in The Chronicle over the last few months. The process for granting such an abatement includes four separate actions by the city council. So it was the council’s action that The Chronicle was covering, more than anything Barracuda itself was doing.

Now, I confess that I fudged the estimated value of the tax abatement, to get the math to work out. The numbers provided by the city of Ann Arbor’s financial staff pegged the value of the tax abatement at around $61,000 – nothing so precise as $61,896.12. Still, there is an actual connection between the tax abatement and the roomful of UM students who were participating in Barracuda’s 24-hour competition.

That connection relates to a condition of the tax abatement. To receive the tax advantage, Barracuda must add another 144 employees (a perfect square? seriously?) to its Ann Arbor operation. And to make room for all those additional employees, Barracuda’s operation is moving from its current Depot Street location to the old Borders corporate headquarters in downtown Ann Arbor – off Maynard Street, under the parking structure.

The hackathon event was part of the company’s strategy to recruit new employees. [Full Story]

Ann Arbor city council meeting (Oct. 1, 2012): The council worked through its densely packed agenda in well under two hours, even though six separate public hearings were held.

Some of the votes, all of which were unanimous, reflected non-action.

The council voted to table a revision to its medical marijuana licensing ordinance, having postponed it twice previously. Tabling is unlike a postponement to a date certain, and leaves open the possibility that the council might not ever take the question up again. However, Sabra Briere (Ward 1) indicated she intended to take up the medical marijuana ordinance again within six months.

The council has yet to act on recommendations from the city’s medical marijuana licensing board, made at the start of the year, to award licenses to 10 dispensaries. In the meantime, those dispensaries continue to operate. At the council’s Oct. 1 meeting, city attorney Stephen Postema indicated he would be creating a public document for the licensing board that would include a summary of pending legislation and court cases.

The council tabled a resolution on establishing a citizens committee to study the question of how to use proceeds from city-owned land sales. That tabling came at the request of the resolution’s sponsor, Mike Anglin (Ward 5), who had originally brought it forward at the council’s previous meeting.

The council also voted to extend by another 180 days a moratorium on digital billboards in the city – which the council first enacted back in April.

Three of the items on which the council took final action were at least indirectly related to stormwater. The council confirmed the appointment of the top area administrator whose department is responsible for stormwater management – Craig Hupy. Hupy’s appointment as public services area administrator comes after 26 years of service with the city.

The council also approved a $300,000 stormwater improvements component of a much larger $6.5 million street reconstruction project for Miller Avenue. The council authorized $50,000 to study the feasibility of opening up the railroad berm near Depot Street, which might allow floodwater to flow unimpeded to the Huron River on the other side. The study is also meant to cover the possibility of a non-motorized transportation connection under the berm, for pedestrians and bicyclists.

Related to water only in name was a tax abatement granted by the council to Barracuda Networks, which is relocating from Depot Street to downtown Ann Arbor and expecting to add 144 jobs.

The council also approved a raft of proposals related to land use. Winning approval were site plans for a Fiat dealership on West Stadium Boulevard and an expansion of the Food Gatherers facility on Carrot Way. The rezoning of a strip around the perimeter of a parcel at Miller and Maple, where a Speedway gas station will be constructed, got final approval.

A proposed townhouse project on Catherine Street got its rezoning as well as site plan approved. At the public hearing neighbors praised the project and developer Tom Fitzsimmons for what he had done to work with them.

The Plymouth Green Crossings project, which has already been built, got initial approval for revisions to its planned unit development (PUD) supplemental regulations.

The council also added 73 acres to the land protected under the city’s greenbelt program by approving the purchase of development rights on the Hornback farm in Salem Township.

The council weighed in on a state ballot question – which would require electric utility companies in Michigan to provide 25% of their power with renewable sources by the year 2025 – by passing a resolution in support of it.

One of the more significant pieces of news to come out of the meeting was an announcement from Stephen Kunselman (Ward 3) that he could not attend the council’s Oct. 15 meeting. That’s when the council is due again to take up the question of putting $60,000 towards a $300,000 local match for a $1.2 million federal grant that would fund a transportation connector study. It needs eight votes to pass. [Full Story]

Following a public hearing on the topic, the Ann Arbor city council has granted a tax abatement to Barracuda Networks in connection with its relocation from Depot Street to the old corporate headquarters of Borders in downtown Ann Arbor, off Maynard Street. The total tax break for the 5-year period of the abatement is expected to be worth $61,000. That’s less than the originally estimated amount of $85,000. The council’s action came at its Oct. 1, 2012 meeting.

Barracuda is a computer network security company. On its application for the abatement, Barracuda indicates that it currently has 155 employees who will be retained due to the abatement. The firm expects to add 144 employees by July 1, 2014. The property on which Barracuda is requesting … [Full Story]

The third of four steps associated with a tax abatement for Barracuda Networks was taken by the Ann Arbor city council at its Sept. 4 meeting – setting a public hearing on the tax abatement, to be held Oct. 1, 2012.

The council had previously set a hearing on the establishment of an industrial development district (Michigan’s Act 198 of 1974) at 317 Maynard St. in downtown Ann Arbor and voted to establish that district at its Aug. 9, 2012 meeting. That set up the opportunity for Barracuda Networks to apply for a tax abatement as it moves from its current location on Depot Street to the downtown site. [.jpg of parcel map showing 317 Maynard] [.jpg of aerial photo ... [Full Story]

Ann Arbor city council meeting (Aug. 9, 2012) Part 2: Ballot initiatives for the Nov. 6, 2012 election – two about parks and one on public art – were the dominant theme of the council’s meeting. Those are covered in Part 1 of the meeting report.

But the council transacted several other pieces of business as well, some of which could be grouped into the general thematic pattern of land and property use. Most obviously connected to land use was the council’s initial approval of a rezoning request in connection with an expansion proposal from Knight’s Market, at the corner of Miller and Spring streets. The rezoning would allow a house to be converted into a bakery. It would also allow for eventual approval of a site plan to build a 1,200-square-foot addition to the existing grocery store and to expand, reconfigure, and improve the existing parking lot.

The council also passed a resolution to deal with an issue stemming, in part, from land use decisions made decades ago that resulted in residential development in the area of the Malletts Creek drainage district. Recently, residents in the area have been faced with severe localized flooding. The council’s resolution directed staff to start negotiations with the Washtenaw County water resources commissioner to identify “opportunities for stormwater conveyance and stormwater quality improvement in the area of the Malletts Creek drainage district.”

Related at least tangentially to land use at the level of a specific parcel was a resolution the council passed establishing the property at 317 Maynard in downtown Ann Arbor as an industrial development district. The move sets the stage for an expected application from the future tenant of the space, owned by First Martin Corp., for a tax abatement that would be worth around $85,000. The tenant is Barracuda Networks.

And the council took another step in implementing a strategy to eliminate blight. The city had previously set aside funds that could be used to demolish blighted buildings – if the city is unsuccessful in getting property owners to demolish them. The council’s action last Thursday authorized the city to sign contracts with four different companies to do such demolition work on an as-needed basis. It was announced at the meeting that the houses on North Main – at the site of the planned Near North affordable housing project – will likely be among the first to be demolished under the contracts authorized by the council.

To the extent that transportation systems have an impact on future land use, another item related to land use was a reapproval of the articles of incorporation for a possible new countywide transportation authority. The articles of incorporation are part of a four-party agreement to establish a framework for possibly expanding the governance and service area of the Ann Arbor Transportation Authority.

The four-party agreement is between the cities of Ann Arbor and Ypsilanti, Washtenaw County and the AATA. The Ann Arbor council changed the minimum threshold of votes required on the proposed new 15-member transit authority board, an action that brought the council in line with a version that the Washtenaw County board of commissioners had approved earlier this month. That threshold was increased from a 2/3 majority (10 votes) to a 4/5 majority (12 votes).

In other business, the council authorized the hiring of three additional firefighters for the next two years, using a federal grant. It also authorized the purchase of a new aerial fire truck.

Nominations to city boards and commissions made at the meeting included reappointment of Sandi Smith, Roger Hewitt and Keith Orr to the board of the Ann Arbor Downtown Development Authority. And Sally Petersen, who won the Ward 2 Democratic primary on Aug. 7, was nominated for the city’s commission on disability issues.

The council also heard public commentary on a range of topics, including smart meters and the idea of corporations as people.  [Full Story]

A new industrial development district has been established for the downtown Ann Arbor property at 317 Maynard St., which sets up the opportunity for Barracuda Networks to apply for a tax abatement as it moves from its current location on Depot Street to the downtown site. The vote establishing the district was taken by the Ann Arbor city council at its Aug. 9, 2012 meeting after a public hearing. The council’s vote was unanimous.

Under Michigan’s Act 198 of 1974, the next step for that abatement, on application from Barracuda, will be for the city council to set a public hearing on the abatement. After the public hearing, the council could then grant the abatement, which is estimated to be valued at around $85,000.

At … [Full Story]

Ann Arbor city council meeting (July 2, 2012): The council’s agenda was relatively light, consisting of several apparently unrelated items. But for some agenda items, “sustainability” was a common theme.

Most obviously fitting that theme was a resolution passed by the council directing the city’s planning commission to incorporate 16 sustainability goals into the city’s master plan. The 16 goals, which were compiled from existing planning documents, had worked their way through a community engagement process and were adopted by several city commissions before arriving before the city council. The goals fall into four categories: climate and energy; community; land use and access; and resource management.

Clearly related to land use and access (the goal of “preserve our natural systems”), as well as resource management (“eliminate pollutants in our air and water systems”) was a resolution directing city staff to develop a “green streets” policy. The policy would formalize an approach to stormwater management that would allow city street projects to incorporate various technologies to mimic natural processes, to reduce the amount of stormwater runoff that goes directly into the city’s stormwater pipes and on into the Huron River. Features like bioswales, for example, would filter stormwater through natural systems so that pollutants from street surfaces would not flow directly to the river.

The river itself was part of the meeting’s sustainability theme as it was highlighted with a mayoral proclamation in honor of Huron River Day, which falls on July 15 this year.

Among the specific sustainability goals in the category of “community” is one that addresses economic sustainability: “Develop a prosperous, resilient local economy that provides opportunity by … rewarding investment in our community …” In that spirit, the council took the first step toward awarding a tax abatement to Barracuda Networks, a company that recently announced it’s moving from its Depot Street location into downtown Ann Arbor as part of a planned expansion of its workforce.

Another agenda item could be analyzed as part of the “integrated land use” and “economic vitality” sustainability goals: final approval of a rezoning request for the Shell station on the northeast corner of Ann Arbor-Saline and West Eisenhower Parkway.

Fitting into the “community” sustainability category was a resolution that made Ann Arbor a member of the Washtenaw Health Initiative (WHI) by authorizing a $10,000 annual membership fee. The goal of the WHI is to help local health care providers handle an influx of an estimated 50,000 newly insured patients when federal health care reforms take effect in 2014. The specific sustainability goal is to “provide services that meet basic human needs of impoverished and disenfranchised residents to maximize the health and well-being of the community.”

The council also approved appointments to three city commissions that are connected thematically to the sustainability goals – environmental, greenbelt advisory, and planning.

Making the city of Ann Arbor more financially sustainable is not an explicit part of the sustainability goals adopted by the city council. Yet financial sustainability could be seen as an outcome of the council’s ratification of three different union contracts. All three contracts increase the retirement benefit vesting period for new hires from five to 10 years, and increase the period for the final average compensation calculation to five years from three. The three labor groups that had their contracts ratified were the police professional assistants, civilian supervisors, and the deputy police chiefs.

Some of the public commentary also featured a sustainability theme – as former Allied Bendix engineer Kermit Schlansker outlined the energy efficiency benefits of cisterns. Also weighing in during public commentary were opponents of the new “smart meters” that are being installed by DTE Energy in Ann Arbor and other Michigan communities.

In other business, the council approved a weapons screening contract with the Washtenaw County sheriff’s office – for the 15th District Court, located inside the new justice center along with the Ann Arbor police department.

During communications time, city attorney Stephen Postema updated the council on legal action related to the Dream Nite Club, which had its liquor license revoked earlier this year. He said four significant court rulings on lawsuits filed by the club’s owners against the city had gone the city’s way.

The council’s communications also included mention of two ballot questions that voters might have to decide in November. One is a renewal of the park maintenance and capital improvements millage. The council is almost certain to place that millage renewal on the Nov. 6 ballot. Another question is less certain – one that would change the city charter to require a voter referendum, if the city were to lease parkland. The charter already prohibits the sale of parkland without a referendum. [Full Story]

At its July 2, 2012 meeting, the Ann Arbor city council voted to set a public hearing under Michigan’s Act 198 of 1974 on establishing an industrial development district for 317 Maynard St. in downtown Ann Arbor. Setting the hearing – for Aug. 9, 2012 – is the first of several actions that will be necessary to grant a tax abatement to Barracuda Networks, which is relocating from Depot Street to the downtown property owned by First Martin Corp. A letter dated June 1, 2012 from First Martin to the Ann Arbor city clerk requested the establishment of the district.

After the public hearing on the district, the council will need to vote on establishing the district. Then Barracuda Networks will need … [Full Story]

At its May 21, 2012 meeting, the Ann Arbor city council approved a tax abatement for Sakti3 – a battery technology spinoff from the University of Michigan. Sakti3 is led by UM professor Ann Marie Sastry.

The council had postponed their vote on the tax abatement at the council’s May 7 meeting – at the request of Marcia Higgins (Ward 4), who wanted the matter referred first to the council’s budget committee.

According to the staff memo accompanying the resolution, the abatement would be on $151,433 of real property improvements and $1,374,861 of new personal property. According to a memo from city financial staff, the value of the tax incentive to Sakti3 over three years totals $36,000.

Reasons given in the staff memo for the abatement … [Full Story]

After a public hearing held at its May 7, 2012 meeting, the Ann Arbor city council delayed a tax abatement for Sakti3 – a battery technology spinoff from the University of Michigan. Sakti3 is led by UM professor Ann Marie Sastry. The postponement – until the council’s next meeting – came at the request of Marcia Higgins (Ward 4), who wanted the matter referred first to the council’s budget committee. Comments around the council table suggest that when it comes back on May 21, there’ll be support for the abatement.

According to the staff memo accompanying the resolution, the abatement would be on $151,433 of real property improvements and $1,374,861 of new personal property. According to a memo from city financial staff, … [Full Story]

At its April 16, 2012 meeting, the Ann Arbor city council voted to set a public hearing for May 7 on a tax abatement for Sakti3 – a battery technology spinoff from the University of Michigan. Sakti3 is led by UM professor Ann Marie Sastry.

According to the staff memo accompanying the resolution, Sakti3 is requesting an abatement on $151,433 of real property improvements and $1,374,861 of new personal property. If approved, it would reduce Sakti3 Inc.’s annual tax bill by $23,200 for each of three years in the recommended abatement period. The new building improvements and personal property investments would generate about $29,500 in property taxes for each year during the abatement period.

Previously, the council voted on March 21, … [Full Story]

Ann Arbor city council meeting (Oct. 17, 2011): At its meeting last Monday, the Ann Arbor city council acted on two different residential development projects for the block of Fifth Avenue just south of William Street. Both projects are owned by the same developer.

At the time of their votes – on the matter-of-right City Place and the planned unit development Heritage Row – councilmembers knew that one set of actions would become moot. Only one of the projects, located on the same site, would be built. A few days after the meeting, news emerged that Heritage Row is now off the table and that City Place will move forward, with construction planned to start sometime this fall.

That meant that the council’s action last Monday, to give initial approval to the Heritage Row project, will ultimately have no effect. Developer Jeff Helminski requested that the item be pulled from the council’s Oct. 24 meeting – a meeting that had been added to the council’s calendar specifically to take a second and final vote on the Heritage Row project.

At their Oct. 17 meeting, the council took two actions on the already-approved City Place project – one to allow flexible application of the city’s new landscape ordinance, and a second to approve additional windows on the upper stories and to change the siding. That added to an Oct. 3 decision by the council to allow greater flexibility in the sequencing of City Place construction.

Also on Monday, the council confirmed two appointments to the city’s zoning board of appeals. The ZBA is a body that has purview to hear any challenges to city decisions about the correct application of city ordinances and the appropriateness of administrative decisions, including those associated with matter-of-right projects like City Place.

In other real estate development news out of Monday’s meeting, the council approved changes to the elevations for City Apartments, a residential project at First and Washington scheduled to start construction yet this season. The council is expected to authorize the sale of the city-owned parcel at its Nov. 10 meeting.

The council approved the annexation into the city of a township parcel where Biercamp Artisan Sausage & Jerky has set up shop. A tax abatement for Arbor Networks, a computer network security firm, was also approved by the council.

Another significant item on the council’s agenda was the appropriation of $25,000 from the city’s general fund reserve to keep the warming center open this year, which is operated by the Shelter Association of Washtenaw County in the Delonis Center on Huron Street.

The council also approved a resolution of intent on the use of sidewalk and street millage funds, which voters will be asked to approve at the polls on Nov. 8. The resolution was amended to clarify how funding will work for sidewalk repair adjacent to commercial properties inside the Ann Arbor Downtown Development Authority district. [Full Story]

At its Oct. 17, 2011 meeting, the Ann Arbor city council granted a tax abatement to Arbor Networks, a computer network security company. The abatement is on $883,527 of real property improvements and $7,790,454 of new personal property and equipment.

According to the staff memo accompanying the resolution, Arbor Networks was granted a tax abatement in 2008. The abatement agreement in 2008 required Arbor Networks to move 74 jobs to their Ann Arbor facility and add at least eight jobs. However, as of December of 2010 there were only 74 jobs at this location.

The staff memo on the current request for a tax abatement states that the digital information business is continually changing with new and faster technology. Arbor Networks needs new test equipment and digital equipment, and according to the memo, anticipates adding 20 new employees to the Ann Arbor facility.

This brief was filed from the city council’s chambers on the second floor of city hall, located at 301 E. Huron. A more detailed report will follow: [link] [Full Story]

At its June 20, 2011 meeting, the Ann Arbor city council set the date for a public hearing on July 18, 2011 for a tax abatement for Picometrix LLC, located at 2925 Boardwalk in Ann Arbor. Picometrix is a supplier of high-speed optical receivers.

The 5-year abatement would apply to $2,434,882 of personal property that Picometrix is acquiring. From the application for abatement: “Due to the projected increase in production volume, the company will need to purchase assets to maximize production and support added staffing.”

The list of personal property included in the application ranges from garden-variety desks and cubicles to digital oscilloscopes and laser beam profilers. If the abatement were approved, it would reduce the company’s annual tax bill for the new equipment by about $16,500 annually. The new personal property would generate approximately $20,700 in property taxes for each year during the abatement period, according to the city staff memo accompanying the resolution.

The industrial development district in which the Picometrix tax abatement is sought was established in 2006.

At its June 6 meeting, the council held a public hearing on a proposed tax abatement for another company – Sakti3. No one spoke at that hearing, and the council did not take a vote on the abatement that evening. No council vote is currently scheduled for the Sakti3 abatement.

This brief was filed from the city council’s chambers on the second floor of city hall, located at 301 E. Huron. A more detailed report will follow: [link] [Full Story]

At its May 2, 2011 meeting, the Ann Arbor city council voted to set a public hearing on the granting of a tax abatement to Sakti3, a University of Michigan battery technology spinoff from the University of Michigan. Sakti3 is led by UM professor Ann Marie Sastry. The public hearing will be held as a part of the city council’s June 6, 2011 meeting, which starts at 7 p.m.

Sakti3 is requesting an abatement on $200,000 of real property improvements (electrical construction work) and $2.2 million of personal property (battery cycling equipment, thermal chambers, machine shop equipment, server system).

If granted, the abatement would reduce Sakti3′s annual tax bill for the new improvements by about $17,000 for each year of the abatement. According to city staff, the new real and personal property investments would generate about $22,500 in property taxes each year.

Previously, the council voted on March 21 to set a public hearing on the establishment of the industrial development district under which Sakti3 is applying for an abatement. And on April 4, the city council approved the establishment of the district.

This brief was filed from the city council’s chambers on the second floor of city hall, located at 301 E. Huron. A more detailed report will follow: [link] [Full Story]

Ann Arbor city council meeting (March 21, 2011): In its highest profile business of the evening, the council finally gave its initial approval to a licensing plan for medical marijuana businesses.

The council has now been formally considering the new licensing ordinance for three months. The ordinance will next come before the council at its Tuesday, April 19 meeting for final approval. Also on April 19, the council will take a final vote on a zoning ordinance that would apply to medical marijuana businesses. The moratorium on use of property in the city for medical marijuana businesses – originally enacted on Aug. 5, 2010 to last for 120 days, but subsequently extended – was extended again at Monday’s meeting through June 30, 2011. [.pdf of medical marijuana licensing ordinance as amended on March 21, 2011]

In a lower-profile but logistically significant move, the council voted to move its second meeting of April from Monday to Tuesday, April 19, because sundown on that Monday marks the start of the week-long Passover celebration in the Jewish tradition.

Other business conducted by the council included: (1) approving a recommendation for non-renewal of a liquor license for the Fifth Quarter; (2) authorizing transfer of $90,000 to the Ann Arbor Downtown Development Authority to improve a public plaza near the Forest Street parking structure; (3) setting a public hearing to establish an industrial development district that could lead to tax abatements for the firm Sakti3; (4) authorizing a letter of support for a Washtenaw County grant application to the state for acquisition of a natural area; and (5) authorizing the city’s own application to the state for grants to support park improvement projects and a new skatepark.

Council deliberations on the park improvement grant applications resulted in the prioritization of a grant to support construction of the skatepark over one to support improvements to the Gallup park canoe livery. The city hopes both grants will be approved by the state.

The council also heard a presentation on a plan for the Millers Creek area, and later in its meeting adopted the plan. It could eventually lead to establishing the creekshed formally as a “drain,” in the sense that the county water resources commissioner (formerly the drain commissioner) uses the term. That designation will increase the area’s eligibility for various funding mechanisms to pay for projects there.

The council heard a presentation from its street outreach task force, summarizing its work over the last six months. That work includes a proposed revision to the city’s panhandling ordinance, which the council will begin considering at its April 4 meeting.

The council also passed a resolution establishing a search committee for a new city administrator. The committee will bring a recommendation to the council at its April 19 meeting on an interim administrator, who will assume responsibilities when current city administrator Roger Fraser departs at the end of April.

The city’s IT director, Dan Rainey, was on hand to receive a Digital Cities award recognizing the city’s efforts to improve services through digital technology. Fraser mentioned during his communications time that the council’s meetings are now being streamed live over the Internet: CTN Channel 16 Live. [Full Story]

Ann Arbor City Council meeting (Jan. 18, 2011): At its most recent meeting, scheduled a day after the Martin Luther King Jr. holiday, the council was due to consider, for a second time, a first-reading of a licensing scheme for medical marijuana businesses that has been put forward by city attorney Stephen Postema.

After amending the licensing proposal heavily at its Jan. 3, 2011 meeting, the council had decided to postpone the measure until Tuesday’s meeting. After a relatively brief attempt to undertake further amendments, the council decided to postpone consideration again – until its Feb. 7, 2011 meeting. They also voted to extend the moratorium on opening additional marijuana dispensaries and cultivation facilities through March 31, 2011.

Not relatively brief were Christopher Taylor’s (Ward 3) opening remarks about a resolution that would have authorized the Ann Arbor Downtown Development Authority to design a plan to develop city-owned downtown parking lots.

In the end, the council decided to postpone consideration of the DDA parcel-by-parcel proposal – on a 6-4 vote, with some of those voting against postponement looking to vote it down. The effect of the postponement was likely similar to what outright rejection would have been. The clear message was this: Substantial revision to the proposal would be required to gain the kind of overwhelming support the measure will likely need to persuade DDA board members that the council is in agreement with the proposal.

Another piece of major business, which passed quietly, was approval of an overhaul of the ordinance language defining the city’s retirement system. An additional tax abatement for Edwards Brothers received a lot of discussion, but was ultimately approved.

The city also accepted a grant from the Home Depot Foundation for sustainability work, that earned praise for the city’s environmental coordinator, Matt Naud. In other city environmental action, David Stead was reappointed to the city’s environmental commission, and Steve Bean’s decision was announced that he had not sought reappointment to that commission, after a long tenure.

Th site plan for Lake Trust Credit Union at the southeast corner of West Liberty and West Stadium Boulevard was approved. And two additional parcels were added to the land that is protected by the city’s greenbelt program.

As budget season looms, Stephen Rapundalo (Ward 2), who serves on both the city council’s budget committee and the labor and administration committee, gave a status update on the city’s negotiations with its unions. [Full Story]

Ann Arbor City Council meeting (Sept 7, 2010): The council handled its relatively light agenda without taking a recess, taking a little over two hours to finish its Tuesday-after-Labor-Day business.

An item that could have prompted extended deliberations – the so-called “porch couch ban” – was instead postponed until the council’s next regular meeting on Sept. 20. At the start of the meeting, the council heard a staff presentation on the fire hazards posed by porch couches and their negative visual impact.

Mayor John Hieftje and the sponsor of the measure, Christopher Taylor (Ward 3), indicated early in the evening that a postponement of the couch ban was likely, but several people still addressed the council during a public hearing on the issue. The public hearing will be continued until Sept. 20, when the council is likely to take a final vote on the matter.

Among the business the council did vote on at Tuesday’s meeting was a tax abatement for NanoBio worth around $30,000 over the next five years. The biotech company is a University of Michigan spin-out, which has developed nano-technology platforms in the area of topical antibiotics and nasal sprays. The abatement is on NanoBio’s investment of roughly $200,000 in building improvements and $483,000 in equipment purchases for its Green Road facility.

Also affecting the Green Road neighborhood was an application to the Michigan Dept. of Transportation for Thurston Elementary School’s Safe Routes to School program, which the council authorized. The grant from MDOT, worth $157,555, would pay for infrastructure improvements – like pedestrian islands on Green Road. The grant would cover all of the construction costs, with the design and contingency costs of $30,000 to be drawn from the city’s alternative transportation fund, which ultimately comes from the state through Act 51 [gas tax] monies.

The city’s alternative transportation fund was lurking in the background on Tuesday night in an additional way. A public hearing took place on the special tax to be assessed on property owners whose land abuts a proposed non-motorized path along Washtenaw Avenue between Tuomy and Glenwood roads. The project is to be funded from $826,727 out of the alternative transportation fund, $694,039 from an MDOT grant, with a special assessment on property owners paying for the remaining $59,234. Several of the property owners addressed the city council Tuesday night to object to the assessment, which will cost them around $3,500 each.

In addition to the meeting’s usual range of communications and announcements, Stephen Rapundalo (Ward 2) attempted to clarify some comments he’d made at the council’s Aug. 5 meeting about a closed session that council had conducted on July 19 regarding a medical marijuana moratorium. The Chronicle will report on those comments – and the council’s possible Open Meetings Act violation – in a separate opinion piece. [Full Story]

Ann Arbor City Council meeting (Aug. 16, 2010): Monday’s meeting was notable for its brevity, lasting barely over an hour. It was filled with the stuff of small-town governance – mayoral proclamations in honor of park volunteers, local food month, and women’s equality day.

Some of the more interesting conversation emerged during deliberations as the council accepted one of several easements: Why is this one 7 feet wide, when the others measure 10 feet?

Another one of the easements accepted by the council involved a non-motorized path to be constructed on the north side of Washtenaw Avenue between Glenwood and Tuomy roads. That project has a history dating back to 2006. At Monday’s meeting, the council also completed the third of four required steps in the process to establish a special assessment of residents whose property abuts the non-motorized path.

In other business, the council authorized purchases of software, plus IT switches. The switches will support the data center to be housed in the new police-courts facility. The council also set the stage for the local firm NanoBio to be able to apply for a tax abatement, by establishing an industrial development district.

As a part of his city administrator’s report, Roger Fraser seemed to put participants in the annual shopping cart race on notice that the event could be shut down on pain of a missing parade permit. The shopping cart races are a part of “punk week,” which has been part of Ann Arbor’s late summer culture for over a decade. The following evening, the race took place – with Ann Arbor police cruisers serving the same function they’ve performed historically, hanging in the background, providing a measure of protection to racers from traffic approaching from behind.

The shopping cart race featured a former councilmember and DDA board member, Dave DeVarti, who was stirred to participate by Fraser’s threat to shut down the event. [Full Story]