The Ann Arbor city council declined to exercise its right of first refusal on the Edwards Brothers Malloy property at its special session on Feb. 24, 2014. Chuck Warpehoski (Ward 5) compared the process of reviewing the options over the last few weeks to riding a “see saw.” (“Art” by The Chronicle.)

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.

Background on Prior Council Action

Prior to the Feb. 24 session, the council most recently had voted to postpone the question of using its right of first refusal on the Edwards Brothers property. That happened at its Feb. 18, 2014 meeting – after a closed session that lasted about 25 minutes.

Before that, the council had on Feb. 3 postponed the item “to our next meeting” – which at that time was scheduled for Feb. 18. But subsequently a special meeting was called for Feb. 10 to consider the question. That special meeting was then cancelled.

Earlier, at its Jan. 6, 2014 meeting, the council had directed the city administrator and the city attorney to explore options and gather information about the Edwards Brothers land. The due date for that gathering of information was specified in the council’s resolution as Jan. 30 – the same day that the land-purchase item was added to the Feb. 3 agenda.

At its following meeting, on Jan. 21, 2014, the council approved without discussion a $25,550 contract with Atwell LLC for environmental site assessment services on the property. That assessment included a survey of asbestos-containing materials.

The pending sale of the property to UM was announced in a Nov. 27, 2013 press release. The business – a fourth-generation Ann Arbor publishing and printing firm – had signaled its intent to put the property on the market in late July.

An item authorizing the $12.8 million purchase was approved on Feb. 20, 2014 by the UM board of regents, so that the university could move ahead if the city did not exercise its right of first refusal.

The city’s right of first refusal on the property was a condition of a tax abatement granted by the city council three years ago, on Jan. 18, 2011. Purchase by the university would remove the property from the tax rolls. Washtenaw County records show the taxable value of the property at just over $3 million. In 2013, Edwards Brothers paid a total of $182,213 in real property taxes, not all of which is the city’s levy. The total city levy of 16.45 mills on $3 million of taxable value works out to about $50,000.

According to the tax abatement agreement, the event triggering the city’s right-of-first-refusal window of 60 business days was a formal notification to the city by Edwards Brothers, which was made on Nov. 27, 2013. According to a staff memo from city administrator Steve Powers, the city had until Feb. 26, 2014 to exercise its right of first refusal. If the city decided to exercise that right, it had to close on the purchase by Feb. 28, 2014.

Deliberations: Brief Overview

Stephen Kunselman (Ward 3) had possibly telegraphed his intent to vote no on the question by voting against going into closed session on Feb. 18. Discussion of land acquisition is one of the exceptions in the Michigan Open Meetings Act, which otherwise requires that all parts of a meeting be open to the public. Votes to go into closed session require a roll call vote of the council under the OMA.

At the council’s Feb. 24 special session, Kunselman repeated his no vote on the question of going into a closed session.

Before the meeting, Community Television Network staffer Christopher Maassen explained to city clerk Jackie Beaudry that a new microphone had been provided for her.

So when deliberations opened, a provisional tally would have already had Kunselman in the no column. But the first four councilmembers to speak indicated they’d be supporting the resolution: Sally Petersen (Ward 2), followed by Sabra Briere (Ward 1), then Margie Teall (Ward 4) and Jane Lumm (Ward 2).

Then Jack Eaton (Ward 4) weighed in against the resolution, followed by Sumi Kailasapathy (Ward 1). Another no vote besides Kunselman’s anticipated expression of opposition would at that point have provisionally settled the issue.

That indication of opposition came from Christopher Taylor (Ward 3), which was a surprise to many – including Kunselman. But Taylor’s position was not adamant. In fact, he wound up arguing that the case for voting yes was stronger than other no-voters had let on.

By the time Kunselman weighed in, that brought the tally to four councilmembers who said they’d be opposing the resolution. Mike Anglin (Ward 5) then added sentiments against the resolution, as did Chuck Warpehoski (Ward 5).

Warpehoski and mayor John Hieftje both noted when they spoke that it was already apparent how the vote was going to turn out.

The tally for mayoral candidates on the vote was 2-2: Briere and Petersen voted for the resolution; Kunselman and Taylor voted against it. All of these councilmembers have declared their candidacy for mayor in this year’s Democratic primary.

Deliberations

Sally Petersen (Ward 2) led off deliberations by saying they all had known University of Michigan has been interested in the property, and that it’s a special situation for the city.

From left: Sabra Briere (Ward 1) and Sally Petersen (Ward 2).

They’d heard consistently from UM that on topics of mutual interest, the university would certainly collaborate with the city, she noted. This is a situation where the city and the university literally have common ground and mutual interest, Petersen said. And figuratively, the parcel’s tax base makes a significant contribution to the ability of the city to provide quality of life to its residents. She said that the issue of quality of life was of mutual interest to both UM and the city of Ann Arbor. It’s a pivotal time and a chance to collaborate well with UM – if the city chooses to purchase the land. And collaborating with the UM is just one option available, she said.

So Petersen was prepared to vote yes – because the city’s acquisition of the land could help improve the city-university relationship in precedent-setting ways. If for some reason the university and the city can’t collaborate, she added, then other options are available. The council was not voting that evening on what to do with the property. Rather, the council was just voting on whether to exercise the right of first refusal. Petersen called it a great opportunity for the city that the city doesn’t have very often. That opportunity was the chance to own an asset that could be mutually beneficial for the quality of life for both the city and the university.

Sabra Briere (Ward 1) was up next. She thanked Petersen for her comments, saying they echoed many of her own thoughts over the last day.

Sabra Briere (Ward 1).

Briere reported she’d talked to the most fiscally conservative people she knows – who have advised her to exercise the right of first refusal if given a choice. That surprised her, because those are people who she would have called “risk averse” and people who look askance at government spending. Yet those people have uniformly asked her to exercise the right of first refusal. She had also spoken with University of Michigan representatives about the mutual relationship and about the development the university has engaged in and the university’s expectations of support from the city. Of particular interest to her was a conversation that made it clear that if the city exercised its right of first refusal, then the university would have a reason to talk with the city.

The only reason the university  was even considering thinking about the city’s South State Street corridor plan or how the property could be used to benefit both the city and the university is because city was considering exercising the right of first refusal, Briere said.

So Briere said she’d join Petersen in thinking it could be an opportunity to engage in a productive discussion with the university. It might benefit the city’s fiscal situation as well as benefiting the university’s ambition. And for those who urged her to exercise the right of first refusal not because they were conservative but because they were aggressive, she felt that many people would like the UM to understand its impact on the community.

Margie Teall (Ward 4).

Margie Teall (Ward 4) thanked Briere and Petersen for their comments about collaborating with University of Michigan. She saw it as a positive opportunity for the city as well – something that could be very beneficial to the city. She thanked the city staff who had done a very thorough job of reviewing the information and “looking under every rock,” she said. The due diligence has been great, and the information that’s been shared has been very valuable, Teall said. She’d be joining Briere and Petersen in supporting the resolution.

Jane Lumm (Ward 4) was the fourth voice of support out of the first four councilmembers to speak. She called it a difficult decision. She said she could understand how councilmembers could end up in different places on this issue. As a general rule, the city should not be in the real estate business, she said. But as councilmembers, they should decide when it’s appropriate and should not just avoid any and all risk.

She had reached out to UM, but it became clear that it the university was not interested in talking to the city before now. Even though she’d tried to see if the city and university could have a conversation about what could be mutually beneficial, there was not much interest on the university’s side – unless the city exercised the right of first refusal.

Lumm saw this as an opportunity to work with the university. As Teall pointed out, she said, the city staff has conducted a lot of analysis and due diligence. And that’s helped guide the council. The city would be taking on financial risk, she said, with outcomes ranging from a potential $2.2 million loss to a $1.2 million gain. If the city retained control, that would best serve the city’s long term financial interest, Lumm said. When you consider the value of taxes retained for other taxing jurisdiction – if the city exercised its right of first refusal – the financial equation tilts to the positive side, she said. She allowed that she works for the city – not the other taxing jurisdictions – but retaining taxes for the other jurisdictions is a significant interest, too. Risking tax dollars now, in order to protect the tax base for the city and other jurisdictions, would ultimately serve the taxpayers. On balance, Lumm concluded the benefits of the city purchasing the property warranted the risk.

Jack Eaton (Ward 4) offered the first sentiments against exercising the city’s right of first refusal. At the beginning of the process, he said, he wanted nothing more than to keep the property on the tax rolls. It’s a unique parcel in that if the city purchased it, the University of Michigan can’t just go out and buy another 17 acres that serves the same purpose. As he looked at the numbers, however, he’d become more skeptical. Everything has to go absolutely right, he said, in order for the city to come out on the positive side.

In the meantime, Eaton said, the city would be spending about $218,000 a year on an interest-only loan, which would “dwarf” the city’s general fund reserves. The city would also need to try to obtain a $1.5 million brownfield grant. Every aspect of the acquisition of the property by the city is full of potential, but also full of risk. He couldn’t see “gambling with taxpayers’ money,” when the potential for disaster seems to be equal to that of coming out ahead. So he’d vote against the resolution.

From left: Sumi Kailasapathy (Ward 1) and Sabra Briere (Ward 1).

Sumi Kailasapathy (Ward 1) picked up on Eaton’s thoughts, saying that for her it’s a risk-reward calculus. Everything we do in life is full of risks, she said, but we should weigh that against benefits and rewards.

Her main concerns included the fact that the valuation of the property had come out at about $8 million. The city would be purchasing the property for about $12.8 million. Based on the information the council had been provided, the downside could realize capital loss of up to $4 million. She allowed that would be a worst-case scenario. If the property remains on the tax rolls, 28% of the benefit would accrue to the city. But the city would be taking 100% of the risk. She might have felt differently if all the taxing jurisdictions split the risk.

A third issue was the holding cost of $218,000. That would come out of the general fund, and she wondered what would have to be cut as a result – because nothing is certain. What if the city needed to hold the land for three or four years? That would add up to another $1 million. She did not feel confident enough that there’s a market for commercial development. She hasn’t seen a market study that says an additional mall or apartment complex is needed. The downside could be devastating, she said.

Christopher Taylor (Ward 3) led off his remarks by echoing the thanks that had been expressed to staff. At each and every turn, when he’d had questions, the staff had come through with answers that were as clear as possible in a shifting environment. Along the way he had felt well supported.

City of Ann Arbor chief financial officer Tom Crawford. City staff received praise around the table from councilmembers in connection with the due diligence process.

Like Eaton, when this first came up, Taylor said, he was enthusiastic and quite willing to explore the possibility, because the loss of land and tax base is an important long-term challenge with respect to the university. Great benefits accrue to the city due to UM, Taylor said, but one downside is that when the university expands, it does draw land off the rolls. And that’s a long-term challenge to the city: to maintain services to residents and to improve quality of life for residents. So when this issue first came before the council, he felt it was an exciting opportunity to have some agency over that long-term challenge.

Taylor would have liked the university to have engaged in a conversation with the city before an offer had been made to Edwards Brothers. That would have been a fruitful and collaborative effort, he felt. It didn’t turn out that way, and he understood that the interests of the city and the university are not necessarily at odds, but they are not entirely congruent.

So it comes to the city council to decide whether to exercise the right of first refusal, Taylor said. As others had already said, it could go either way: There could be gain or loss. The city has had conversations with people who are interested in purchasing the property – and the city knew that the university is interested in purchasing the property. All those things suggest there is some market opportunity, he said.

Taylor addressed the issue of asymmetric risk: The city stands to get 28% of the benefit in exchange for bearing 100% of the risk. “That’s pretty big for me,” he said. If he were in the business of purchasing real estate, and selling it to developers, he felt it was a deal that could easily work. “There is plainly demand here,” he said, and he thought that the risk is not as great as other councilmembers had indicated. But there is plainly risk, he allowed.

Jane Lumm (Ward 2) and Christopher Taylor (Ward 3).

So he stepped back and asked: “What is mission here?” For Taylor, the mission is to provide quality of life for residents, and to maintain and improve that quality of life with residents, to provide services and to do “the things that residents demand of us.” That requires money, he noted, and so those things are somewhat at odds.

As Taylor approached his conclusion, he set himself up to express the position opposite to the one he wanted to take: “In the end, however, I don’t think that the risk here is – I framed that wrong. I think that the risk here is greater than the reward, in light of our mission.” The city’s mission is municipal, it’s not economic, he said. “We’re not in the real estate business. We’re in the business of providing services and creating a city where people can live and thrive.” So he said he’d “regretfully vote no.”

“We could have pulled it off; we had a reasonable shot at pulling it off,” Taylor said. “In light of our mission, I think a reasonable shot is not good enough.”

Stephen Kunselman (Ward 3) led off his remarks thanking Taylor, saying, “That was well said,” and adding “actually, I’m surprised.” Kunselman then laid out his own position by saying: “I am risk averse.” [At this point, four votes against the resolution were clear.] He’s consistently been opposed to speculative development using taxpayer dollars, he said, noting that he was one of the first to “jump off the bus” on the former Y lot project.

Stephen Kunselman (Ward 3).

At one of the first council meetings after Kunselman was elected, the city was partnering on the Broadway Village, he said – and that’s still vacant land. He thought the city was going to get a parking structure out of it. In considering what other communities have done with speculative development, he looked at Sylvan Township and the added tax cost to that community. None of the Sylvan elected officials are still there, he said, but the community is paying for it.

Kunselman looked at Ypsilanti and the Water Street project. He could only imagine the conversations that officials were having when that project was proposed – but he ventured that they were similar to those the Ann Arbor city council had just had in closed session. “How great it would be, how unique, how thoughtful and foresighted … that the community would spend lots and lots of money for future development that nobody had any idea of what they were doing.”

He looked at the city of Troy, which had partnered with a developer. They got a new train station but can’t figure out who owns the land, so that’s going to end up in court, Kunselman ventured. He also pointed out that the city of Ann Arbor borrowed millions of dollars in connection with the Library Lane underground parking structure, to put in infrastructure [stronger foundations, among other elements] to support future development, but “we have no idea what we’re doing there.”

“No, I’m not into speculative development,” Kunselman continued. That’s out of the realm of health, safety and welfare, he said. About the holding cost for the land, he characterized $218,000 annually as three FTEs [full-time equivalent employees]. If the city has that much money to put toward interest-only payments, then the city had money it could put toward three beat cops downtown, he ventured. “What’s our priority? Beat cops or speculative development?” he asked.

As far as working with the university, “that bus left the station a while ago,” Kunselman said. What is being talked about now is “holding the property hostage and putting a gun to the university’s head” and saying, “come talk to us now.” That’s not a great way to start a relationship, Kunselman said. But he agreed with Taylor: If UM keeps buying property, Ann Arbor’s quality of life is going to go down. He hoped UM at some point understands, that at some point it’s going to “kill the goose that lays the golden egg” that provides quality of life for students.

All the students who come from around the world to this community will be isolated downtown, “while the rest of us are trying to fill potholes out in our neighborhoods,” Kunselman said. Speculative development is always based on assumptions, and as Eaton had pointed out, every piece has to work, and if one piece misses, then it fails, Kunselman said. If it winds up in court, the city would lose, he ventured. Local government doesn’t have governmental immunity when it comes to speculative development, he said. So he would not be supporting this.

Petersen took a second turn to reiterate something Kunselman had said: If UM continues to buy up property, the quality of life is going to go down. That’s what would be prevented by exercising the city’s right of first refusal, she contended. When she heard Eaton say that everything has to go right, and when Kunselman says that he doesn’t support speculative development, she wanted to stress that the council was not voting on speculative development that night. The council was not voting on a purchase agreement with a developer. So not everything has to go right, she said.

The council would be buying itself an opportunity to “make things more right,” Petersen said. The downside of not exercising the right of first refusal is a $6 million net present value hit to all the taxing authorities over 25 years, she noted. That was significant to her. She allowed that the city is not in the business of speculative development, but the city is in the business of protecting revenue streams for the city. If the right of first refusal is not exercised, then there will be a significant loss to the city’s revenue stream. If the city does exercise that right, the city has a better chance of increased revenue, Petersen concluded.

Mike Anglin (Ward 5) thanked other councilmembers and staff. He said that when the property on State Street came on the market, the right of first refusal looked like a great opportunity. But when you think about it, he said, it seems speculative. It might be a way to have a conversation with the university, he said, nothing that there’s going to be a new administration at UM. [UM president Mary Sue Coleman is retiring this year, to be replaced by Mark Schlissel.]

Purchasing land and holding it as a “gift” to the university would distract the city from its focus on serving the citizens, Anglin said. There are many things that are not being done that should be done, he noted, and this purchase would make the city potentially vulnerable. About the idea that the land could be used to leverage a conversation with the university, Anglin said, “That’s too high a price to sit at the table with the university.”

Chuck Warpehoski (Ward 5).

Chuck Warpehoski (Ward 5) began by saying that for him, the process has been a see saw: He’s been for it, then against it, for it, then against it. Counting the votes expressed in the deliberations up to that point, Warpehoski ventured that it doesn’t matter what he thinks, so that gave him some freedom to “do whatever I want! I think we should open up a Chuck E. Cheese’s there! ”

He rejected Kunselman’s comparison that acquiring the property was a way to put a gun to the head of the university. That’s just not accurate, Warpehoski said. There’s a lot of detailed collaboration between the city and the university on issues of infrastructure, he said. But sometimes on larger issues it’s difficult to get traction for an agreement. The only way to have a successful negotiation is when you have something the negotiating partner wants or fears. When it comes to the university, he said, the city typically has neither.

Some of the council’s conversation up to that point had been about risk and reward, Warpehoski noted. And that is a big question as the council has looked at the issue from the financial side of things. If the city declines to exercise its option, the city would have a guaranteed loss to the general fund of $50,000 over 25 years. If the city does exercise its right of first refusal, there’s a possible loss or possible gain – but it’s a roll of the dice, he said.

Warpehoski felt the odds were better than even, but it’s still a roll of the dice. Another element is the quality of life piece. The city had been approached by people who develop housing and by people who develop retail. When he thinks of that stretch of South State Street, he doesn’t “get warm fuzzies.” It’s not his favorite part of the city. He was not confident that if UM bought it or the city bought, that his attitude toward that stretch would change. But that quality of life component is a part of the risk-reward calculation.

The conversations at the table reminded Warpehoski of the three questions of Rabbi Hillel. The first question is: “If I am not for myself, who will be for me?” That cuts both ways, Warpehoski said: If the city is for itself, there’s the risk of losing tax revenues or incurring a loss to the general fund. But there’s a potential gain of taxable value. Rabbi Hillel’s second question was: “If I am only for myself, what am I?” There are other people this conversation affects, Warpehoski said. Hillel’s third question: “If not now, when?” On the third question, Warpehoski said, “Well, we’re out of time so that one is easy.” He thought the city’s odds are better than even, he said, but it’s public funds he’d be gambling with, so he wondered if better than even is good enough. “Right now, I’m thinking maybe not,” he concluded.

Lumm allowed that it was an academic argument at this point [given the nose count of councilmembers who'd expressed opposition]. But she followed up on a point Petersen had made: that the other taxing jurisdictions stood to lose $6 million in tax revenue over the next 25 years, if the city did not exercise its right of first refusal.

Jane Lumm (Ward 2) and city attorney Stephen Postema.

She called protecting the tax base a “share responsibility,” allowing that it was unfortunate that the city would be bearing all the risk. There’s an upside to controlling a major parcel, she said. It’s a once-in-a-lifetime opportunity on one of the city’s busiest corridors, she said. It could be a potential catalyst to redevelopment of the corridor and realizing master plan goals. It would not only protect the tax base, it would increase it. She’d done her best to reach out to the university. She commended city administrator Steve Powers for extending an olive branch many times to the university.

It’s unfortunate when she heard from the university that if the city exercised its right of first refusal, it would have a chilling effect on the city-university relationship: “What does that say?” Lumm asked. That’s not something that partners say to each other, she said. Powers has put forth a superb effort and tried “valiantly” to reach out to the university, Lumm said. The city needs the university to understand that the city is serious about protecting its tax base. Because of the lack of interest up to now, the city didn’t have negotiating leverage, she said.

Kunselman followed up on some of the commentary about the city-university relationship. “Everyone knows I work for the university,” he said. He pointed out that this was the first year that the council has not had an invitation to a regent-council dinner or cocktail hour. “So our relationship is obviously not doing very well,” he ventured. Last year, the event was canceled because of the UM basketball team made the Final Four. In prior years, the council and regents had some social interaction around this time of year, Kunselman noted. He didn’t think that purchasing the property would be a nice way to say that the city wants to restore its relationship.

Ann Arbor city administrator Steve Powers.

Everything has unintended consequences, Kunselman said, and that why it’s called speculative. It’s an admirable goal to try to protect the tax base. But the city could not be able to outbid the university on every piece of land it wants over the coming years. And the city knows which property the university wants: It’s next to the land they already own. That’s strategic planning on their part, he said. The university has an “institutional patience” that the city council does not have, Kunselman said. The university can plan ahead for decades.

The question is whether the city can establish a better relationship with UM and encourage the university to start building “up instead of out.” Kunselman ventured that when UM bought the Pfizer property, “none of us were complaining then. We looked at it as a good thing.” [Across the table from Kunselman, Teall was visibly exasperated at Kunselman's remarks about Pfizer, expressing some incredulity.] Kunselman responded to Teall, saying he remembered being happy about it. There were people talking about how good it was that the property was being “backfilled with people,” Kunselman said. At least, he said, the city was not trying to outbid the university. He didn’t think it was the greatest thing either, because the acquisition of the Pfizer property by UM resulted in the city losing 4% of its tax base. But the buildings were at least not sitting empty. [The former Pfizer campus is now the UM North Campus Research Complex (NCRC).]

As a real estate deal, the city would be buying high so it was priced at a premium, Kunselman said. That’s not good real estate business sense to flip this and think you’re going to make some money, Kunselman said: He’d learned in that in Peter Allen’s real estate class. The idea that the city will protect the tax base by buying high, hoping to sell at a greater profit, doesn’t make a great argument, he said. Public health, safety and welfare – that is the city’s mission, Kunselman said. When the city’s quality of life is higher than other communities, that creates a strong tax base.

About the zoning in the area, Kunselman said that the master plan for South State Street doesn’t call for C3 (commercial) zoning. So he was not about to throw all the master planning documents out just to speculate. The planning documents reflect what the community wants in that part of the city, he said. He urged councilmembers to vote down the resolution, encouraging those who’d expressed support to change their minds.

Briere responded to Kunselman. The city didn’t exercise a right of first refusal on the Pfizer property, she said, because the city didn’t have one. And to suggest that the might have had such a right she found “a little distracting.” She recalled how many residents suggest that when someone proposes a use for a piece of property they oppose, that the city should simply purchase the land. She allowed there are no arguments to say that exercising the right of first refusal on the Edwards Brothers property is a safe risk.

But the question the council was considering was land acquisition, not zoning or a particular project, Briere stressed. The discussion was about being in control of how a piece of property was used in the future. She called that a rare situation for the city. Making the conversation about the University of Michigan is the “lowest hanging fruit” argument, she said. She didn’t look at it as being about the university. She ventured that the council would have had some of the same discussions about the land, if Edwards Brothers had chosen to sell it to a different party. In some cases, the university is a distraction. She understood both sides of the risk argument. “To me this is an acceptable risk,” she said, because she believed it was short-term.

Kailasapathy reiterated the fact that the $8 million appraisal compared to the $12 million purchase price reflected a 50% premium. The city would be paying a premium, and the clock was ticking. That 50% premium made the city vulnerable, she said. The city’s options would be narrowed by agreeing to pay that premium.

Taylor used his second turn to “defend the yes voters,” even though he was voting no. The argument based on the premium purchase price was not as strong as it was portrayed, because the terms of the deal include a rental payment and cell tower revenue. The city is also in a position that is distinct from an ordinary purchaser, Taylor said. The city’s economic return is influenced by the purchase price, but is not solely dependent on it. It’s not required that the city buy the property at $X and sell it as $(X + Y) – because the city can make it up on the back end. So the case for voting yes is stronger than what some councilmembers had portrayed, he said.

Taylor also thought that the council’s decision on this matter was not an “existential question” on the university-city relationship. Generally, the city and the university get along, he said. The university’s mission is distinct from the city’s, he said. He characterized the existing relationship as “cordial.” He said that an initial conversation between the university and the city would have been good at the point when the university was thinking about buying the property. But that didn’t happen and that was a disappointment.

Responding to a point Petersen had made that the loss was guaranteed, if the city did not exercise its right of first refusal, Taylor allowed that if the city did act, there was a chance to eliminate the loss and to achieve a benefit. But he concluded that the chance was not sufficient and the risk was off-mission.

From left: city attorney Stephen Postema and mayor John Hieftje.

Mayor John Hieftje ventured that the outcome was pretty clear at this point. He got clarification that some of the tax abatement granted by the city would be coming back to the other taxing jurisdictions. That’s because by selling the property, Edwards Brothers would not be living up to the terms of the tax abatement. City CFO Tom Crawford explained that there’s a clawback provision in that case. It returns taxes to jurisdictions amounting to a total of $200,000. The city’s portion of that is $90,000.

Hieftje called the opportunity to exercise the city’s right of first refusal as a very good thing to investigate. It was something that needed to be investigated thoroughly. He commended city staff for making that happen. Due diligence was indeed performed, he said. That had been necessary to satisfy the council and the public that everything had been looked into.

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. He continued by saying that when university representatives produce their standard list of benefits that the university brings to the community, it’s as if UM is pretty much responsible for anything good that happens. But the items on the list are just what a state-financed university should be doing, he said.

Hieftje wished the university had reached out to the city before it got to this point. He’d made a call, and the city administrator had made efforts. It would have been be a perfect time to say: Let’s talk about this. But that didn’t happen, he said. At some point, Hieftje added, the university’s continued expansion will severely impact the quality of life in the city. He also pointed out the impact on other taxing jurisdictions, saying at some point, “They’re [UM] going to wear us all out.”

Hieftje responded to Kunselman’s earlier comments about the Library Lane parking structure as including speculative development. That had opened up the ability of downtown to have high tech jobs, Hieftje said, and the only way to build it smartly was to put it underground, with extra strong foundations.

Hieftje felt like the exercise of the right of first refusal would be going out on a little bit of a limb, not a big limb. He ventured that it could go either way – plus or minus $1 million.

Teall concluded by expressing disappointment about how the vote was going to turn out. She was also disappointed in the “over the top language” and the “posturing” that she’d heard around the table. She responded to Warpehoski’s remarks about the State Street corridor not being his favorite part of town: “I like it – it’s my neighborhood.” Lots of wonderful businesses are located along there, she said.

She ventured somewhat sardonically that perhaps the University of Michigan would put up a giant electronic billboard on the Edwards Brothers property. She expressed disappointment that the university would likely not extend Oakbrook to connect State Street and South Main, as it’s envisioned in the city’s corridor plan. She indicated that the university probably did not plan on making it a public road.

Teall concluded that it was a disappointing decision for her.

Outcome: On a 5-6 vote, the council rejected a resolution to exercise its right of first refusal to buy the Edwards Brothers property. Voting to support exercising 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 the resolution 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).

Present: Jane Lumm, Mike Anglin, Margie Teall, Sabra Briere, Sumi Kailasapathy, Sally Petersen, Stephen Kunselman, Jack Eaton, John Hieftje, Christopher Taylor, Chuck Warpehoski.

Next regular council meeting: March 3, 2014 at 7 p.m. in the council chambers at 301 E. Huron. [Check Chronicle event listings to confirm date.]

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The city council voted down a resolution that would have authorized Ann Arbor’s right of first refusal on the Edwards Brothers Malloy property, at a special session of the council on Feb. 24, 2014. That will allow the University of Michigan to purchase the property unimpeded.

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.

The resolution in front of the council, which needed an eight-vote majority on the 11-member council, was defeated on a 5-6 vote. It would have approved the exercise of the city’s right of first refusal, appropriated necessary funds, and directed the city administrator to notify Edward Brothers Malloy about the exercise of the city’s right.

The vote came after a closed session lasting an hour and 40 minutes. The council then deliberated for about an hour and 10 minutes.

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 2-18-14] [Feb. 18, 2018 memo to council]

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).

In their remarks, most councilmembers cited the overall risk to the general fund that remained in most scenarios that might play out. Those that voted in support of the resolution indicated that their understanding was that the University of Michigan would not be interested in collaborating on the future of the property, unless the city exercised its right of first refusal.

Most recently, the council had voted to postpone the question at its Feb. 18, 2014 meeting after a closed session that lasted about 25 minutes.

Before that, the council had on Feb. 3 postponed the item “to our next meeting” – which was scheduled for Feb. 18. But subsequently a special meeting was called for Feb. 10 to consider the question. That special meeting was then cancelled.

Earlier, at its Jan. 6, 2014 meeting, the council had directed the city administrator and the city attorney to explore options and gather information about the Edwards Brothers land. The due date for that gathering of information was specified in the council’s resolution as Jan. 30 – the same day that the land-purchase item was added to the Feb. 3 agenda.

At its following meeting, on Jan. 21, 2014, the council approved without discussion a $25,550 contract with Atwell LLC for environmental site assessment services on the property. That assessment included a survey of asbestos-containing materials.

The pending sale of the property to UM was announced in a Nov. 27, 2013 press release. The business – a fourth-generation Ann Arbor publishing and printing firm – had signaled its intent to put the property on the market in late July.

An item authorizing the $12.8 million purchase was approved on Feb. 20, 2014 by the UM board of regents, so that the university could move ahead if the city did not exercise its right of first refusal.

The city’s right of first refusal on the property was a condition of a tax abatement granted by the city council three years ago, on Jan. 18, 2011. Purchase by the university would remove the property from the tax rolls. Washtenaw County records show the taxable value of the property at just over $3 million. In 2013, Edwards Brothers paid a total of $182,213 in real property taxes, not all of which is the city’s levy. The total city levy of 16.45 mills on $3 million of taxable value works out to about $50,000.

According to the tax abatement agreement, the event triggering the city’s right-of-first-refusal window of 60 business days is a formal notification to the city by Edwards Brothers, which was made on Nov. 27, 2013. According to a staff memo from city administrator Steve Powers, the city has until Feb. 26, 2014 to exercise its right of first refusal. If the city decides to exercise that right, it must close on the purchase by Feb. 28, 2014.

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]

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 announced in a Nov. 27, 2013 press release. The business – a fourth-generation Ann Arbor publishing and printing firm – had signaled its intent to put the property on the market in late July.

But a right of first refusal on the property is held by the city of Ann Arbor as a condition of a tax abatement granted by the city council almost three years ago, on Jan. 18, 2011. Purchase by the university would remove the property from the tax rolls. Washtenaw County records show the taxable value of the property at just over $3 million. In his remarks on the resolution made at Monday’s meeting, mayor John Hieftje cited the city’s clear interest in maintaining the property on the city’s tax rolls.

According to the tax abatement agreement, the event triggering the city’s 60-day right-of-first-refusal window is a formal notification to the city by Edwards Brothers. Some people not affiliated with the city reportedly believe that this took place on Nov. 26 – but as of early December, there was not consensus on the city’s side that notification had taken place on that date. The 60 days in question are 60 business days, so if the council acted by its second meeting in February, that issue would be in any case moot.

Updated at 2:27 p.m. Jan. 9, 2014: According to city administrator Steve Powers: “The City is operating on a timeline to provide notice to Edwards Brothers prior to February 25, 2014. This calculation is made from Nov. 27th, 2013.”

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]

Figure 1.  Participants in Barracuda’s hackathon programmed their computers to play a game based on a 7×7 grid of squares. The game can also be played between human beings using pen and paper. The basic idea can be described as trying to join two opposite sides of the grid with a connected path consisting of squares you “own.” This image depicts the state of a game board resulting in an agreed-upon draw between an Ann Arbor city councilmember (pink squares, horizontal) and Chronicle editor Dave Askins (green squares, vertical). (Grid by The Chronicle.)

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.

I had to miss the hackathon, but still wanted to offer Chronicle readers a sense of the kind of game the students were programming their computers to play. So I asked Barracuda for the rules and invited an Ann Arbor city councilmember to play a pen-and-paper version.

It’s a familiar kind of game where you find yourself focused sometimes on playing to win and other times on playing not to lose.

The game was made up by Barracuda software engineer Jeremy Bowers. It’s played on a 7×7 grid of squares. Without giving away precise details of game rules – because Barracuda would like to use the game at future hackathon-style recruiting events – each of two players tries to get control of squares in an effort to join opposite sides of the board with a connected path of squares. One player is trying to connect the sides of the grid horizontally; the other is trying to make the connection vertically. The first player to connect wins. (Barracuda has not named this game.)

It was Ward 1 city councilmember Sandi Smith that I invited to play a pen-and-paper version of Barracuda’s recruitment game – for a couple of reasons. Mainly, I wanted to set myself up with an excuse in case I lost. The game is at least partly about claiming “real estate.” And Smith is president of Trillium Real Estate, so she should plausibly have some kind of advantage with whatever expertise she has as a Realtor. The “connecting” aspect of things is also right up Smith’s alley. As an Ann Arbor Downtown Development Authority board member, she’s working on a projected called Connecting William Street – an effort to master plan an area of the downtown that includes five city-owned properties, all of which are currently used for parking.

In the paper-and-pen version I cobbled together, I thought it would be useful to color the squares as a way of keeping track, given that neither of us are computers. The image in Figure 1 above is a re-creation of the state of the board when we stopped – after about an hour of play, including discussion of the rules.

At that point, we each had $8 left in our respective banks, and there was one square remaining that was of any interest to either of us. The square – in the fourth row, sixth column – would have completed a connection, winning the game for whoever claimed the square. On the next turn of the game, the only rational play for each of us was to attempt to claim that square, using all of our remaining funds –$8. And the rules would have awarded that square to the winner of a coin flip.

Smith summed it up by characterizing our extended gameplay as just a very complicated way to flip a coin. And we agreed to a draw – because we are human beings, not computers.

There’s probably a lesson in there somewhere for local Ann Arbor politics.

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

Left to right: Mike Anglin (Ward 5) and mayor John Hieftje.

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.

Medical Marijuana

The council considered a resolution that would change amendments to its medical marijuana licensing ordinance.

The ordinance amendments in question were recommended by the city’s medical marijuana licensing board at the start of the year. Representative of the revisions is a change that strikes the role of city staff in evaluating the completeness of a license application. The following phrase, for example, would be struck: “Following official confirmation by staff that the applicant has submitted a complete application …” The changes also establish a cap of 20 licenses, and grant the city council the ability to waive certain requirements. The board-recommended revisions to the medical marijuana licensing ordinance are laid out in detail in The Chronicle’s coverage of the medical marijuana licensing board’s Jan. 31, 2012 meeting. [.pdf of recommended licensing ordinance revisions]

The licenses that the board recommended be granted to 10 dispensaries citywide – recommendations also made at the board’s Jan. 31, 2012 meeting – have not yet come before the city council for final action. The proposed ordinance revisions, recommended by the city’s medical marijuana licensing board on Jan. 31, had already been considered and postponed once before, at the council’s April 2, 2012 meeting. When the item came back on June 18, 2012, it was postponed, again until Oct. 1.

The general background of the current medical marijuana climate includes enactment of two kinds of local regulations for medical marijuana businesses last year, at the city council’s June 20, 2011 meeting. One piece of legislation set the zoning laws that apply to such businesses – establishing where medical marijuana dispensaries and cultivation facilities could be located. The other piece of legislation established a process for granting licenses to medical marijuana dispensaries. Cultivation facilities are not required to be licensed.

In the meantime, medical marijuana dispensaries in Ann Arbor continue to dispense marijuana to patients.

Medical Marijuana: Council Deliberations

Sabra Briere (Ward 1) noted this was the third time the item had been on the agenda. Up to now the postponements have involved pending legislation in Lansing. She noted that there would be six months during which it could be taken up off the table, before it would demise, by council rule. She felt she’d likely do so within six months but found no reason to postpone to some date certain.

Jane Lumm (Ward 2) said that given what’s going on at the state level, it’s clearly the wiser approach for now to table it. She also looked forward to seeing a memo that the city attorney, Stephen Postema, has said he’d be providing publicly for the city’s medical marijuana licensing board. Postema noted that the Michigan Supreme Court is taking two cases to be heard on Oct. 11. Those cases deal with the dispensary issue, he said. The court of appeals has ruled against dispensaries, he said. He reported that he’d met with a state representative who’s sponsoring legislation that would provide a local option for municipalities to enact or not, that could allow dispensaries to exist, regardless of the outcome of the state Supreme Court cases.

Outcome: The council voted unanimously to table the amendments to the medical marijuana licensing ordinance.

Committee on Land Sale Proceeds

On the agenda was a proposal to create a 10-person citizens committee to study options for proceeds of the sale of city-owned downtown Ann Arbor properties.

The resolution had been added by Mike Anglin (Ward 5) to the agenda of the council’s previous meeting on Sept. 17, 2012, but was postponed until the Oct. 1 meeting. Anglin’s resolution called for establishing a committee of 10 residents – two from each ward, to be selected by councilmembers from each ward – plus other city officials to address the issue of city-owned parcels in downtown Ann Arbor.

Anglin’s resolution was somewhat vague about how the committee was supposed to address the issue or in what timeframe, and was met with questions at the Sept. 17 meeting about the scope of the committee’s intended purview or its deliverables.

At the Sept. 17 meeting, Anglin’s resolution was one of two that the city council had been asked to consider on the topic. The other one had been brought forward by Sandi Smith (Ward 1), who first outlined the idea to other councilmembers in an email written three weeks prior to their Sept. 17 meeting. It involved directing the proceeds from city-owned land sales to the city’s affordable housing trust fund. Smith’s resolution was postponed at the Sept. 17 meeting until Oct. 15, and was in the meantime referred to the council’s budget committee. Based on the budget committee’s discussion, at a meeting immediately preceding the Oct. 1 meeting of the full council, that committee’s recommendation to the council will likely be for a much weaker version of Smith’s resolution, if it recommends anything at all.

Committee on Land Sale Proceeds: Council Deliberations

Mike Anglin (Ward 5) said that because of other discussions on similar topics that are taking place in the community – among city councilmembers and other groups that are interested in the downtown properties – he wanted to see the proposal tabled. He was satisfied that other councilmembers had expressed at the previous meeting their feeling that the proposal had merit.

Outcome: The council voted unanimously to table Anglin’s resolution.

Digital Billboard Moratorium

The council considered a moratorium on the erection of digital billboards in Ann Arbor. The moratorium, which also prevents city staff from even considering applications to put up digital billboards, was first enacted at the council’s April 17, 2012 meeting.

Falling under the moratorium are “billboards commonly referred to as ‘electronic message centers,’ ‘electronic message boards,’ ‘changeable electronic variable message signs,’ or any billboard containing LEDs, LCDs, plasma displays, or any similar technology to project an illuminated image that can be caused to move or change, or to appear to move or change, by a method other than physically removing and replacing the sign or its components, including by digital or electronic input.”

The resolution passed by the city council in April acknowledges that such signs are already prohibited by the city’s sign ordinance. From that ordinance, the list of prohibited signs include those that “… incorporate in any manner or are illuminated by any flashing or moving lights other than for conveyance of noncommercial information which requires periodic change.”

Digital Billboard Moratorium: Council Deliberations

Christopher Taylor (Ward 3) reminded the council of the moratorium that had been enacted back in April. He reported that it’s taking more time for the staff to determine best practices and to research the relevant case law. So the request was to extend the same moratorium for another 180 days.

Outcome: The council voted unanimously to approve the extension of the moratorium on digital billboards.

Craig Hupy as Public Services Area Administrator

The council was asked to appoint Craig Hupy as public services area administrator for the city of Ann Arbor. Hupy has been serving as interim area administrator for the better part of a year. Public services includes drinking water, stormwater, sanitary sewer, streets, fleet, systems planning and field operations.

Hupy is an engineer by training, and holds a bachelor of science degree from Michigan Technological University. He’s worked for the city since 1986.

The city council’s appointment of the position is stipulated in the city charter in Section 12.1(b):

The appointive officers shall be the City Administrator and the Attorney, who shall be appointed by the Council; the Assessor and the Treasurer, the Clerk, the Controller, the Director of Building and Safety Engineering, the Fire Chief, the Police Chief, the Superintendent of Parks and Recreation, the Superintendent of Public Works, and the Superintendent of Utilities, who shall be appointed by the Council on the recommendation of the City Administrator;

Hupy had replaced Sue McCormick as public services area administrator on an interim basis, after she left that post to take a job as head of the Detroit water and sewerage department in late 2011. McCormick’s last day on the job was Dec. 16, 2011.

When the city administrator announced the interim appointment of Hupy at the Dec. 29, 2011 meeting, he said that Hupy wouldn’t be a candidate for the permanent job: “City administrator Steve Powers announced at the council’s Dec. 5 meeting that the city’s head of systems planning, Craig Hupy, will fill in for McCormick on an interim basis. Powers reported that Hupy had no interest in the permanent position.”

Hupy wrote to The Chronicle in response to an emailed query about the reason for rethinking his interest in the job: “The realization that my public service within the various operations of the City of Ann Arbor had prepared me well to lead the Public Services Area forward and face the future’s challenges.”

Craig Hupy: Council Deliberations

Mayor John Hieftje stated that he fully concurred with the city administrator’s selection, saying that Hupy had performed well as interim.

Mayor John Hieftje.

Hupy would have big shoes to fill, he said – an allusion to former public services area administrator Sue McCormick. He said that Hupy has stepped up to the task and has been successful working with citizens on some controversial issues [like overland and basement flooding].

Mike Anglin (Ward 5) praised Hupy’s leadership on the flooding issue in West Park. Jane Lumm (Ward 2) heard that people were receiving water bills much higher than expected, who were asking questions, which she had forwarded to Hupy. Hupy had handled those questions, she said. She congratulated Hupy, saying it’s one of the most senior positions in the city, to which he’d be bringing lots of experience and technical knowledge.

Stephen Kunselman (Ward 3) offered praise not just for Hupy, but for city administrator Steve Powers as well – for making Hupy his choice. Hupy has been a city employee since 1986, so that means Powers is looking at hiring from within. That means the city has cultivated qualified applicants, he said. And hiring from within encourages people to stick around.

Outcome: The council voted unanimously to confirm Craig Hupy’s appointment as public services area administrator.

Miller Avenue Stormwater Project

The council considered a $300,000 stormwater improvements proposal for Miller Avenue – between Maple Road on the west and Newport Road on the east. The stormwater improvements are part of a larger road reconstruction project, which will cost about $6.505 million.

The stormwater improvements will consist of rain gardens and infiltration basins within the right-of-way. The pavement will not be porous, however – it will be a traditional road surface.

The goal of the improvements is to reduce the amount of stormwater entering the stormwater pipes that flow directly to the Huron River. The idea is that if water is processed through rain gardens and infiltration basins, it will contain fewer contaminants that would otherwise be introduced directly into downstream creeks and the river. The city is subject to state-mandated total maximum daily load (TMDL) for total suspended solids, E. coli and phosphorus.

The council’s requested action was to approve the required petitioning of the Washtenaw County water resources commissioner’s office. The project is eligible for financing through the state’s revolving fund loan program at 2.5%. And the water resources commissioner will be assessing the city no more than $19,245 a year for the payments. It’s possible that up to 50% of the loan will be forgiven because it’s a “green” project.

Mike Anglin (Ward 5) was encouraged by the fact that some people who live along the corridor are putting in more rain gardens and the city staff is helping people to do that. It’s going to be possible to have bicycle paths five feet wide on each side of the road, and a lot of water will be held onsite, which he called really terrific. He felt the project should help the situation downstream as well. He was disappointed that the same approach to achieving some water detention on the property was not achieved for the Stadium Boulevard reconstruction project.

Sabra Briere (Ward 1) commended staff for being creative by building structures under the street for stormwater capture.

Jane Lumm (Ward 2) said she thought the financing piece is also very attractive – given the low interest on the $300,000 loan.

Outcome: The council voted unanimously to approve the petitioning of the county water resources commissioner for the Miller Avenue stormwater project.

Railroad Underpass

The council considered a $50,000 contract with Orchard, Hiltz & McCliment Inc. to conduct a study of a possible underpass for some active railroad tracks in Ann Arbor – which separate the area south of Depot Street (including 721 N. Main) from the Huron River.

The railroad tracks run along the top of a berm. The idea is to study the possible impact of replacing the solid berm – which acts as a dam for stormwater flow from the Allen Creek creekshed – with a culvert or a trestled system for suspending the tracks. The idea of opening up the railroad berm is that it would allow floodwater to pass unimpeded to the Huron River, and lower the depth of potential floods in the area. Also a part of the study is the potential for using the opening as a non-motorized access point to the river, for pedestrians and bicyclists.

For additional detail, see previous Chronicle reporting: “Burrowing under Railroad Berm Feasible?”

Railroad Underpass: Council Deliberations

Sabra Briere (Ward 1), who’d asked that the item be pulled out from the consent agenda for separate consideration, noted that the study is one of many ways the city is looking at dealing with stormwater. She pointed out that one of the council mandates to a task force currently looking at the North Main corridor is to give advice on the best way to get over, under or around the railroad tracks – to connect 721 N. Main to the Border-to-Border trail. At the same time, the city is looking at ways of dealing with floodwater. The study will explore if there’s an acceptable way to find a passage for floodwater and a passage for pedestrians and bicycles in the same location, she said.

Outcome: The council voted unanimously to approve studying the opening of the railroad berm.

Barracuda Tax Abatement

The council was asked to consider a tax abatement to Barracuda Networks in connection with its relocation from 201 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.

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 the abatement ranges from cubicles and desk chairs to telephone network equipment and wiring.

The tax abatement agreement between the city of Ann Arbor and Barracuda makes the expectation of 144 new hires an explicit condition on receiving the abatement:

Barracuda Networks will add not less than one hundred forty four (144) jobs at the facility named on the Application as compared to its number of employees as of the effective date of the Certificate. If Barracuda Networks adds less than one hundred forty four (144) additional jobs by December 31, 2014, Barracuda Networks shall have materially breached the terms of this Agreement and the City shall have the right to recommend revocation of the Certificate subject to provision 10 of this agreement to the State Tax Commission or taking other appropriate legal action in connection with the default.

The council had voted at its Sept. 4 meeting to set the public hearing held on Oct. 1. And 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 to the downtown site. [.jpg of parcel map showing 317 Maynard] [.jpg of aerial photo showing 317 Maynard]

Barracuda Tax Abatement: Public Hearing

Thomas Partridge told the council that recipients of the tax abatements should be required to come before the council to present their case for why they can’t find private capital to achieve the same goals. Those companies should also have policies in place so that senior citizens and lower income workers won’t face job discrimination.

Sean Heiney introduced himself as founder of Ann Arbor’s Barracuda research and development office. He told the council it’s worked out well so far. In 2007 Barracuda had started its Ann Arbor location with five software development engineers; now, over 200 people are employed on Depot Street. He characterized the 144 position to be added as great-paying jobs, which would have a positive impact on the community. He called Ann Arbor a “cornerstone” of the company’s planned expansion.

Barracuda Tax Abatement: Council Deliberations

Jane Lumm (Ward 2) thanked the city’s CFO, Tom Crawford, for the due diligence done on the application. She noted that many cities grant abatements to retain businesses.

Sandi Smith (Ward 1).

Ann Arbor is already attractive and rarely needs to provide such incentives, she said. Lumm noted that it’s important to have Barracuda occupy the old Borders corporate location, and felt that adding 144 jobs is a positive outcome.

Mayor John Hieftje asked Crawford how much the relocation of Barracuda would add to property tax revenues. Crawford didn’t have the figures in front of him, but noted the city already receives property tax revenue from the parcel. Hieftje said he’d had meetings with folks over at Barracuda, and appreciate their resolve to stay in Ann Arbor. He said the company is bringing a lot of energy to the downtown area.

Sabra Briere (Ward 1) reported that she’d had several exchanges with Crawford and wanted to point out that when the council approved the establishment of the industrial development district, the estimated value of the tax abatement for the five-year period was higher [$85,000] than the current estimate of $61,000. That had been based on an investment by Barracuda of almost $2 million in improvements, she said. But Barracuda had been able to be more frugal, so it was less of a “hit” to the city. Sandi Smith (Ward 1) balked at the word “hit,” saying that it’s money that the city is forgoing for a short period of time.

Outcome: The council voted unanimously to approve Barracuda’s tax abatement.

Food Gatherers Site Plan

The council considered a proposal from Food Gatherers to expand its large warehouse, adding cooler and freezer space to accommodate its focus on fruits, vegetables and other fresh food. The Carrot Way site, on Ann Arbor’s far north side, is a hub for the nonprofit’s food distribution. The city planning commission recommended approval of the site plan at its Aug. 21, 2012 meeting.

The site plan was a revision to the nonprofit’s planned unit development (PUD), which will allow for a 12,646-square-foot addition to the back of the existing 16,977-square-foot building.

That building houses the nonprofit’s administrative offices, storage warehouse, and training space. The plan also will add 22 parking spaces to the site, and includes an expansion of produce-washing stations, used to clean vegetables grown at gardens on the site. The Carrot Way site is located on the north side of Ann Arbor off of Dhu Varren Road, east of Pontiac Trail.

According to a staff memo, the changes include a separate administrative land transfer request to shift a shared lot line between the site and a parcel of vacant land to the southeast – both owned by Food Gatherers. The lot line will be moved about 70 feet south, adding 0.43 acres to site where the Food Gatherers’ facility is located. The larger lot size is necessary so that the building addition will conform to the permitted floor-area ratio (FAR). FAR – a measure of density – is the ratio of the square footage of a building divided by the size of the lot. A one-story structure built lot-line-to-lot-line with no setbacks corresponds to a FAR of 100%. A similar structure built two-stories tall would result in a FAR of 200%.

The site plan conforms with the existing PUD zoning, so one approval by the council at the Oct. 1 meeting was sufficient. Changes to zoning require two readings before the council.

Food Gatherers Site Plan: Public Hearing

Former board member Gary Bruder addressed the council on behalf of Eileen Spring, who is executive director of Food Gatherers. He described the addition of the warehouse and office space, and characterized the need for it as straightforward: the economy is facing great challenges. In Washtenaw County, 1 in 7 adults and 1 in 6 children are experiencing hunger, he said, and of those only 1 of 8 have sufficient access to fruits and vegetables. That had driven a Food Gatherers decision to add cold storage to meet those needs. The addition to the space would allow the doubling of the nonprofit’s food distribution capacity, from 5 million to 10 million pounds a year, and increase their storage capacity for proteins and produce from 32 pallets to 260 pallets.

They’ll have better work space for volunteers and be able to increase the diversity of food choices for people who receive food from the nonprofit, Bruder said. The project team was there, he said, who would be available to answer questions: David Esau of Cornerstone Design, John Curry from Professional Engineering Associates, and John Reed, Food Gatherers director of operations.

Food Gatherers Site Plan: Council Deliberations

Other than a remark from mayor John Hieftje to the effect that the renaming of the street where Food Gatherers is located had resulted in some pushback from the U.S. post office, the council did not deliberate further on the request.

Outcome: The council voted unanimously to approve the Food Gatherers site plan.

Fiat Site Plan

The council considered a plan to build a new Fiat showroom next to the post office on West Stadium Boulevard. The property is owned by the Suburban Collection of Troy. The site plan was recommended to the council for approval by the planning commission at its Aug. 21, 2012 meeting.

The property had originally been developed in the late 1950s as a gas station, but underground tanks have been removed. It had been purchased by the Naylor Chrysler dealership in the mid-1990s, and most recently was acquired by the Suburban Collection of Troy, which operates a Chrysler Jeep dealership across the street at 2060 W. Stadium. Suburban also owns local Cadillac and Chevrolet dealerships located on Jackson Avenue.

The site plan calls for demolishing a 2,505-square-foot automotive service building and constructing a 3,408-square-foot showroom. The 30,010-square-foot site is zoned C3 (fringe commercial) and is located next to the post office on the west side of Stadium Boulevard between Federal Drive and East Liberty. The new showroom building will be on the south side of the site, roughly in the same spot as the existing building. However, it will be shifted toward the front lot line to comply with the city’s maximum 25-foot front setback requirement.

There are two driveways now off of West Stadium Boulevard. The southern driveway and curb cut will be closed, and filled in with landscaping.

According to a staff memo, the site has 43 parking spaces. The city granted a variance in 1998 as part of an addition to the building and expansion of the parking lot. The variance allows four parking spaces in the front – at the time, a 40-foot minimum front setback was required. The variance also permits parking stalls to be “stacked” for vehicle storage, with a 20-foot aisle between the stacked parking spaces.

There is no current stormwater management on the site. The proposed plan includes underground stormwater management for a 100-year storm volume.

Fiat Site Plan: Public Hearing

Thomas Partridge told the council that a dedicated and reliable form of revenue for affordable housing in Ann Arbor was needed.

Stanley Tkacz, of Studio Design-ST, addressed the council representing the Suburban Collection. He hoped the council would look at the building program and support it.

Fiat Site Plan: Council Deliberations

The council did not deliberate further on the Fiat site plan.

Outcome: The council voted unanimously to approve the Fiat site plan.

Plymouth Green Crossings

The council considered several changes to the PUD supplemental regulations for Plymouth Green Crossings – a mixed-use complex off of Plymouth Road, west of Green Road.

The city planning commission gave its recommendation to approve the change at its Aug. 21, 2012 meeting.

The current request proposes six major changes: (1) adding parking or flexible space for special events as permitted uses in the ground floor of a proposed three-story mixed-use building, on the site’s northeast corner; (2) increasing the use of potential restaurant space within the site from 7,000 square feet to 14,224 square feet; (3) eliminating requirements for a free-standing restaurant that had previously been planned; (4) increasing the maximum number of parking spaces from 275 to 290; (5) reducing the minimum number of bicycle storage spaces from 70 to 64; and (6) adding the following language to the facade section: “ground level facades of Building A if used as interior parking shall include architectural columns, a minimum 3-foot height masonry screen wall, and louvers or grills to screen views to parking while permitting natural ventilation.”

In addition, the city recently discovered that the bank building was built one foot from the west property line, although the approved site plan and supplemental regulations required a two-foot setback. To resolve this, the owner proposed an amendment of the PUD supplemental regulations, according to a staff memo. The memo also indicates that the owner has been making contributions to the city’s affordable housing fund, rather than providing affordable housing within the complex. The final payment is due at the end of this year. [For background on a current policy discussion on the affordable housing trust fund, see "City Council to Focus on Land Sale Policy"]

This isn’t the first time that changes have been requested for the site. In 2009, developers also asked to amend the original PUD agreement. Rather than build a restaurant, they asked for permission to turn that part of the site into a temporary parking lot, adding 26 additional parking spaces and 11 spots for motorcycles. The planning commission didn’t act on that request until its Feb. 18, 2010 meeting. Although all five commissioners at that meeting voted to approve the request, the action required six votes to pass, so it failed for lack of votes. However, the request was forwarded to the city council, which ultimately granted approval at its April 19, 2010 meeting.

Outcome: The council voted unanimously to approve changes to the PUD supplemental regulations for Plymouth Green Crossings.

Speedway Rezoning

The council considered the final step to rezone a small portion of a parcel at North Maple and Miller – essentially a formality associated with development of a Speedway gas station at that location. The zoning will change from PL (public land) to C3 (fringe commercial).

The portion of the parcel that’s subject to the rezoning has an easement requiring public access; that easement will remain. The project is located at 1300 N. Maple on a 1.39-acre site. The portion of the parcel that’s subject to the rezoning request is a path that circles the property along the east and north sides. [.jpg of drawing showing the property and the portion to be rezoned]

Approval of the site plan and the initial approval of the rezoning for the gas station had come at the council’s Sept. 4, 2012 meeting. The recommendations for approval by the Ann Arbor planning commission came at that body’s July 17, 2012 meeting.

At the council’s Sept. 4 meeting, city planning manager Wendy Rampson indicated that by looking through the city’s files, planning staff had not been able to determine why the portion of the parcel had been zoned PL in the first place. Every era has its own set of practices, she said. She felt it’s possible that planning staff at the time thought that the PL zoning would send a message that the property was to be used by the public, which is consistent with the easement requiring public access. Rampson said the city does things a bit differently now. She said if the council chose not to approve the rezoning, it wouldn’t change anything on a practical level. But she felt that it’s “cleaner” to make it clear that the land is owned by the private property owner and that maintenance is the responsibility of the owner.

Outcome: Without deliberating further, the council voted unanimously to approve the Speedway parcel rezoning.

Catherine Street Townhouse Project

The council considered a site plan and rezoning request for a residential project on Catherine Street that includes a three-story townhouse with five housing units at 922-926 Catherine St. The initial approval of the rezoning request had been given at the council’s Sept. 4, 2012 meeting. That rezoning request had been recommended for approval at the July 17, 2012 meeting of the Ann Arbor planning commission.

The two vacant parcels are on the south side of Catherine between Ingalls and Glen, across from the University of Michigan School of Nursing building. The lots are located in the Old Fourth Ward historic district.

The development – which according to the owner, Tom Fitzsimmons, will be marketed to students, UM employees, young homebuyers, and empty nesters – entails rezoning the parcels from PUD (planned unit development) to R4C (multi-family residential). The PUD zoning is tied to a previous development that was approved but never built. The current site plan was contingent on approval from the city’s zoning board of appeals for variances from the conflicting land use buffer requirement. The ZBA granted that variance at an August meeting.

Five garages would be part of the development, with nine parking spaces and bike storage located below the townhouses. A 24-foot-wide curb cut is proposed off Catherine Street for a driveway, which would run along the east side of the site leading to the garages.

The proposed building and site layout plans were approved by the Ann Arbor Historic District Commission on April 12, 2012.

Catherine Street Townhouse Project: Public Hearing

Thomas Partridge introduced himself as an advocate for residents who would benefit from affordable housing. He endorsed this rezoning but said that the city council should pass an ordinance that requires dedication of significant amount of available acreage to affordable housing for every proposal. During a separate hearing on the site plan, Partridge questioned the lack of density on the site, saying that Ann Arbor needs to be known as a university town not a real estate Mecca.

Christine Crockett introduced herself as president of the Old Fourth Ward Association. Alluding to the frequently debated topic of public art, she said the most important public art is good architecture. The developer and builder of the project had hired a talented architect, she said: Lincoln Poley. She called it the right project for the right place. She welcomed these condos into the ward, saying that the project adds to the kind of dwelling units people want in the R4C-zoned neighborhood. She was pleased with the way Fitzsimmons has handled the project. Every step of the way, he has included the neighbors in the process. She reiterated that good architecture is the best public art.

Julie Ritter told the council she lives next door to the proposed project. She’s delighted it’s going up. Fitzsimmons had been professional, courteous and thoughtful in his interactions with the neighbors, she said. She asked the council to support the project.

Tom Fitzsimmons introduced himself to the council as the developer as well as the builder for the project. He told the council it’s been a long time since he’s appeared before the council, so he wasn’t sure if there’d be Q & A. But he told them that he was available, as was the engineer on the project.

Catherine Street Townhouse Project: Council Deliberations

The council did not deliberate further on the project.

Outcome: The council took separate unanimous votes of approval on the rezoning and site plans for the Catherine Street project.

Ann Arbor Greenbelt: Hornback Farm

The council was asked to approve the acquisition of development rights on the Hornback farm in Salem Township as a part of Ann Arbor’s greenbelt program. The specific request was to approve $199,367 from the city’s open space and parkland preservation millage for the purchase of development rights on the property. The roughly 73-acre farm is located on Pontiac Trail and Brookville Road.

Jane Lumm (Ward 2) and Paul Fulton of the IT department before the Oct. 1 meeting.

The appraised value of the property was $321,000, but the landowner made a 10% donation of $32,100, leaving a purchase price of $288,900. Of that, the city of Ann Arbor’s share was $160,500 after contributions from Salem Township and Washtenaw County of $64,200 apiece. The city incurred due diligence costs ($10,000), closing costs ($5,000) and made a contribution to the greenbelt endowment ($23,867) that brought the city’s share to $199,367.

The city’s 30-year 0.5 mill greenbelt tax was established by a voter referendum in 2003 for the purpose of “funding the acquisition of land for parks and the acquisition and management of land and land rights in undeveloped and developed land both within and outside the City of Ann Arbor for the purpose of preserving and protecting open space, natural habitats and the City’s Source-waters.”

Ann Arbor Greenbelt: Hornback Farm – Council Deliberations

Jane Lumm (Ward 2) allowed that other councilmembers might be getting tired of her objections to some of the greenbelt acquisitions. She said that when the millage was passed, the idea was that the city’s share would not be more than a third of the cost. For this particular property, she noted, the city’s share was closer to a half. But she said she would support this acquisition, because of the participation of Salem Township and Washtenaw County.

Outcome: The council voted unanimously to approve the acquisition of development rights on the Hornback farm.

25-by-25 Ballot Question

The council considered a resolution in support of a statewide Michigan ballot proposal that would require electric utilities to provide at least 25% of their annual retail sales of electricity from renewable energy sources by the year 2025.

Renewable energy sources are defined as wind, solar, biomass, and hydropower. Although it would change the state’s constitution, the proposal includes provisions that could extend the 2025 deadline into the indefinite future. An annual extension could be granted if it would prevent rate increases of more than 1% per year. The proposal would limit rate increases required to achieve the 25% standard to no more than 1% per year.

25-by-25 Ballot Question: Public Comment

Not speaking directly to the ballot question, but nonetheless commenting on a related topic, Kermit Schlansker stated that he’s in favor of building new nuclear plants. But he wanted to build as few as possible, in order to lower cost and reduce safety problems. He encouraged the use of solar, wind, biomass, and geothermal sources of energy, to reduce the number of nuclear plants that would be required. He then described a range of applications of solar energy, including photovoltaic arrays, building-oriented systems, and mirrored arrays.

Wayne Appleyard introduced himself as the current chair of the city’s energy commission. He told the council it was important to pass the resolution supporting Proposal 3. The energy commission will be sending a climate action plan to the council next month, which a task force has been working on for the past year. That plan recommends that 25% of the community’s energy be produced by renewable sources by the year 2025. That parallels a goal adopted by the University of Michigan, he said. Proposal 3 is the single most important element of reaching that goal, he said. The current law –Public Act 295 – is moving electric utilities toward the goal of 10% renewable energy in 2015. But utilities have not endorsed Proposal 3, and essentially intend, he contended, to stop producing more renewable energy in 2015. The cost of wind and solar continues to fall but the long-term cost of burning fossil fuel is increasing, he said.

Outcome: The council voted unanimously to approve the resolution in support of Proposal 3.

Communications and Comment

Every city council agenda contains multiple slots for city councilmembers and the city administrator to give updates or make announcements about important issues that are coming before the city council. And every meeting typically includes public commentary on subjects not necessarily on the agenda.

Comm/Comm: Future Attendance – Transit Connector Study

Stephen Kunselman (Ward 3) announced that he would be absent for the next council meeting on Oct. 15. [He's attending a professional conference in connection with his employment as energy liaison at the University of Michigan.] So he alerted his colleagues that his seat would be empty at that time.

The impact of Kunselman’s absence is that his vote will not be available to support an item on that meeting’s agenda – a request for $60,000 to study a transit connector for the corridor that runs from US-23 and Plymouth southward along Plymouth to State Street and farther south to I-94. This alternatives analysis phase of the study is to result in identifying a preferred choice of technology (e.g., bus rapid transit, light rail, etc.) and the location of stations and stops.

The Ann Arbor city council already voted on Sept. 4, 2012 to reject the $60,000 request, but reconsidered that vote two weeks later on Sept. 17, 2012. But on reconsideration of the vote, the council decided to postpone a decision until Oct. 15. Kunselman voted for the proposal at the Sept. 4 meeting, but at that meeting he appeared somewhat non-committal. His absence on Oct. 15 will reduce the body to no more than 10 members for a vote that requires eight to pass.

In the meantime, some of the requested $60,000 might actually be provided by the Ann Arbor Downtown Development Authority. Initial indications to the AATA were that the DDA’s budget constraints would not allow a contribution to the local match. But at a Sept. 26, 2012 meeting of the DDA’s operations committee, it was decided that the full DDA board would be asked to consider a connector study funding resolution at its Oct. 3 meeting. The DDA resolution would specify a $30,000 total contribution by the DDA, in two $15,000 payments to be made in each of the next two years. Members of the DDA’s operations committee wanted to make the $30,000 contingent on the city of Ann Arbor providing the other $30,000.

The $60,000 is a portion of $300,000 in local funding that has been identified to provide the required match for a $1.2 million federal grant awarded last year to the AATA for the alternatives analysis phase. The breakdown of local support was originally intended to be: $60,000 from the city of Ann Arbor; $150,000 from the University of Michigan; and $90,000 from the AATA.

Comm/Comm: Retirement System

Jane Lumm (Ward 2) said she’d be bringing forward a resolution that would transition the retirement system from a defined benefit to a defined contribution system. It would be just for new hires, she said.

Comm/Comm: Towing

Sabra Briere (Ward 1) reported that she’d talked to the city attorney’s office about the existing ordinances affecting the towing of vehicles. Some kind of revision could be forthcoming.

Comm/Comm: Living Wage

Jane Lumm (Ward 2) announced that a revision to the living wage ordinance will be introduced at a future meeting to address a nonprofit exemption. The housing and human services advisory board would review it first. She hoped that by the second meeting in October something might be ready, but allowed it could be later.

Comm/Comm: Lewy Body Dementia Proclamation

At the start of the meeting, Tamara Real received a mayoral proclamation declaring October as Lewy Body Dementia (LBD) Awareness Month. In her brief remarks, Real told the council that her husband, Carl Rinne, suffered from LBD. So it was personal to her that it helps other people learn about the illness, she said. She suggested that for people who have loved ones who show shifts in behavior, they should visit the website of the Lewy Body Dementia Association, concluding: “You don’t have to go through this alone.”

Chronicle readers might remember that the Ward 5 Democratic primary debate in 2010 was hosted by Real and Rinne in their home. Real is former president of the Arts Alliance. Rinne is a University of Michigan associate professor emeritus of education.

Comm/Comm: Citizens United Decision

Weston Vivian – who’d been introduced for public commentary by mayor John Hieftje as “Vivian Weston” because the agenda showed his name printed that way – jokingly led off in falsetto. He asked the council to show its support for a Constitutional amendment to reverse the impact of the Citizens United U.S. Supreme Court decision, which held that corporations could spend money on “electioneering communications.” Vivian described the situation as one where the actions of one member of the Supreme Court would take 100 million Americans to reverse. He allowed that it’s a long and tedious task. He asked the council to consider passing a resolution, indicating the city’s desire that the change to the Constitution be made. He pointed to other governing bodies that had passed similar resolutions recently in the state of Michigan (Ypsilanti, Ingham County, Lansing) and elsewhere (Chicago and Los Angeles).

Comm/Comm: A2 Open City Hall

City administrator Steve Powers noted that the city’s online Open City Hall had two topics open: the fire station reconfiguration and the urban forestry plan.

Powers also noted that the city is still seeking feedback on the solid waste plan through an online survey.

Comm/Comm: Living Next to Construction

Eleanor Linn introduced herself and her husband as residents of Forest Court. She noted that it’s been four and a half years since the first uproar about a proposed high rise building at the corner of Forest and South University. [The building in question was originally named 601 S. Forest, but changed to the Landmark.] On the occasion of the building’s recent opening, Linn gave the council a summary of what has happened, saying that “noise and dust” as a description of living next to a construction site was a gross underestimate. She estimated over $5,000 worth of expense related to air filtering and ventilation.

Linn counted five doctor’s visits for eye and respiratory problems. They’d experienced cleaning and repair problems caused by oily dirt or scratchy dirt and pink mortar that stuck permanently to wet surfaces. She’d made more than a dozen calls about construction noise – which extended beyond the permitted hours from 7 a.m. to 8 p.m. Monday-Saturday. Water and electricity were sometimes cut off without advance notification. The city’s garbage collection sometimes was not provided due to construction equipment blocking the entrance to their street. Muddy water had been allowed to flow into the city’s stormwater system. The developer didn’t secure the abandoned building adequately and squatters had started a fire, she said.

Many claims of the developers didn’t materialize, Linn contended – giving as examples the lack of a green roof and no LEED certification. They’d been told that students recycle so there’d be no garbage. Of course, she said, there’s garbage. They’d been told that students would not bring cars. But instead, she characterized the area as “overrun with automobiles.” The ventilators for the underground parking garage operate all day and all night, and are not supposed to be audible beyond the confines of the property. But she reported that she is frequently awakened by them. The trees along the property line lost their leaves in one week and are now dead. The grading of the pavement is several inches higher than next door, which leaves dangerous gaps. So she urged the council to think carefully when other large projects are proposed.

Comm/Comm: The Most Vulnerable

During public commentary at the start of the meeting, Thomas Partridge identified himself as a Democrat and advocate for all those who need government services the most. He was there to forward the cause of Ann Arbor’s and Michigan’s most vulnerable citizens – the seniors and people with disabilities and those with lower incomes. He said it was time to get behind the election of president Barack Obama. People need to go door-to-door and make sure that everyone is registered and has transportation to the polls, he said.

During public commentary at the conclusion of the meeting, Partridge criticized the lack of an effort to do more to get people registered to vote. He said he’d be a write-in candidate for state representative of the 53rd District, supporting the cause of those who need government services the most – like affordable housing, health care, and education.

Present: Jane Lumm, Mike Anglin, Margie Teall, Sabra Briere, Sandi Smith,  Stephen Kunselman, John Hieftje, Christopher Taylor, Carsten Hohnke.

Absent: Tony Derezinski, Marcia Higgins.

Next council meeting: Monday, Oct. 15, 2012 at 7 p.m. in the second-floor council chambers at city hall, 301 E. Huron. [Check Chronicle event listings to confirm date]

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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 the abatement ranges from cubicles and desk chairs to telephone network equipment and wiring.

The tax abatement agreement between the city of Ann Arbor and Barracuda makes the expectation of 144 new hires an explicit condition on receiving the abatement: “Barracuda Networks will add not less than one hundred forty four (144) jobs at the facility named on the Application as compared to its number of employees as of the effective date of the Certificate. If Barracuda Networks adds less than one hundred forty four (144) additional jobs by December 31, 2014, Barracuda Networks shall have materially breached the terms of this Agreement and the City shall have the right to recommend revocation of the Certificate subject to provision 10 of this agreement to the State Tax Commission or taking other appropriate legal action in connection with the default.”

The council had voted at its Sept. 4 meeting to set the public hearing. And 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 showing 317 Maynard]

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]

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 showing 317 Maynard]

Barracuda is a computer network security company. On its application for the abatement, expected to be worth $85,000, Barracuda indicates that it currently has 155 employees who will be retained due to the abatement and expects to add 144 additional employees by July 1, 2014. The property on which Barracuda is requesting the abatement ranges from cubicles and desk chairs to telephone network equipment and wiring.

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

From left: Mayor John Hieftje and city administrator Steve Powers before the start of the Aug. 9, 2012 council meeting.

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. 

Knight’s Market Rezoning

The council was asked to consider a rezoning request that would allow for expansion of Knight’s Market.

Knight’s Market Rezoning: Background

The market is located at the northeast corner of Spring and Miller. The market’s owner, Ray Knight, also owns two separate, adjacent parcels. (Knight is perhaps best known for his family’s restaurant, Knight’s Steakhouse, located at 2324 Dexter Ave.) The grocery store is on land zoned C1 (local business) and M1 (light industrial). Another parcel at 306-308 Spring St. is zoned R2A (two-family dwelling) and M1, and contains two single-family homes and part of a parking lot. The third parcel at 310 Spring St. is zoned R2A and MI, and contains the other half of the store’s parking lot. All three parcels are currently non-conforming in some way, according to a staff report, and are located in the 100-year Allen Creek floodplain.

The proposal from Knight’s involves several steps. The request calls for 306, 308 and 310 Spring to be rezoned to C1. That rezoning would allow the building at 306 Spring to be converted into a bakery, although the intent is to leave the exterior of the house intact. The rezoning would also allow for approval of a site plan to build a 1,200-square-foot addition to the existing grocery store and to expand and reconfigure the existing parking lot. In addition, the plan requests that 418 Miller Ave. – the site of the existing grocery – also be rezoned to C1.

The proposed work to the parking lot includes providing three additional spaces (for a total of 17 parking spaces), a designated snow pile storage area, solid waste and recycling container storage enclosure, right-of-way screening, conflicting land use buffer, and rain gardens for storm water management. An unused curbcut on Miller Avenue would be removed and the curb and lawn extension would be restored there. A temporary storage building at 418 Miller would be removed. The house at 310 Spring would remain a single-family dwelling. The city planning commission recommended the rezoning on a 6-1 vote at its June 19, 2012 meeting.

Knight’s Market Rezoning: Council Deliberations

When the council came to the item, mayor John Hieftje looked first to Carsten Hohnke (Ward 5) to move the item, but Sabra Briere (Ward 1) interjected, noting that the market was on the Ward 1 side of the street. So Hieftje gave Briere and her wardmate Sandi Smith the privilege of moving and seconding the motion.

Briere noted that both Ward 1 and Ward 5 residents shop at the market and ventured that there are also people who drive to the market as well. She had attended one public meeting about the proposal. She noted that neighbors were very supportive of Knight’s Market, but had questions about the potential impact on the neighborhood. Generally, their concern is about what happens if the property is rezoned and then changes hands, so that Knight’s Market is no longer the owner.

Left to right: During a break, Sandi Smith (Ward 1) and Jane Lumm (Ward 2) joke about the smartphone app Smith uses to time speaking turns of other councilmembers. There have been occasions when Smith has not been joking when she has raised the point of order on Lumm’s speaking turns.

Smith said she’d had a number of conversations with people in the neighborhood – and they’re very supportive of having a local grocer right there and available. That fits well into the zoning, she said, and the idea of fringe commercial abutting the residential area. She heard strong support for it, she said.

Tony Derezinski (Ward 2), who is the city council’s representative to the planning commission, noted that the commission had had a thorough discussion of the issue. He called the characterizations by Briere and Smith as very accurate. It reminded him of the proposal that Zingerman’s Deli had made, when the neighbors had been carefully consulted. Neighbors had raised some issues – not in an attempt to stop the project – but there’d been an outpouring of approval, he said. Questions had been asked and answered, he said. He felt that “commercial crawl” could not occur because of the natural boundaries that would preclude it.

Mike Anglin (Ward 5) noted that the goal was to establish a bakery that would serve the restaurant and the retail store. He noted that it’s meant to strike a balance between land use goals. He said he lived in a neighborhood where he could, without a car, still walk to places and find places to buy enough to eat and drink. But there are neighborhoods where that’s not possible. He said that Knight’s Market is a place that makes that possible, and that Knight’s is a good neighbor.

Stephen Kunselman (Ward 3) also indicated his support for the rezoning request. There used to be a store on Miner between Hiscock and Felch, he recalled, and he was not sure if the city’s zoning still allows for such mom-and-pop type stores. It’s important that the city have opportunities for a walkable, diverse and sustainable community. It’s not something the council would do frequently, he said, but in this case it’s important to do.

Hieftje noted that Knight’s Market has survived for a long time and is kind of a throwback to the past. If you look around Ann Arbor you can find buildings that were at one time a corner store in a neighborhood. As zoning changed, we’ve moved away from that concept, but in select areas, it might be possible to move back toward that approach, he said. Neighborhood stores like Washtenaw Dairy, Jefferson Market and Knight’s Market are a real asset, he said.

Jane Lumm (Ward 2) added she was the “daughter of a grocery man” and called the market a wonderful amenity that everyone in Ann Arbor values. When she goes there, it’s a reminder of what her father did. She appreciated the discussions that had occurred and the support that people were showing for it.

Outcome: The council voted unanimously to give initial approval to the Knight’s Market rezoning request. Because the request involves a rezoning – a change to the city’s set of ordinances – the council will need to give a second, final approval at a subsequent meeting, following a formal public hearing.

Development District 317 Maynard

On the Aug. 9 agenda was a resolution to establish a new industrial development district 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.

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 its July 2 meeting, the Ann Arbor city council had voted to set the Aug. 9 public hearing on the industrial development district. A letter dated June 1, 2012 from First Martin to the Ann Arbor city clerk requested the establishment of the district. First Martin is the owner of the property at 317 Maynard.

From Act 198, it’s the property owner – in this case, First Martin – that files for the establishment of the IDD.

207.554 Plant rehabilitation district or industrial development district; establishment; number of parcels; filing; notice; hearing; finding and determination; district established by township; industrial property as part of industrial development district or plant rehabilitation district also part of tax increment district; termination; notice.
Sec. 4. (1) A local governmental unit, by resolution of its legislative body, may establish plant rehabilitation districts and industrial development districts that consist of 1 or more parcels or tracts of land or a portion of a parcel or tract of land. (2) The legislative body of a local governmental unit may establish a plant rehabilitation district or an industrial development district on its own initiative or upon a written request filed by the owner or owners of 75% of the state equalized value of the industrial property located within a proposed plant rehabilitation district or industrial development district. This request shall be filed with the clerk of the local governmental unit.

And according to Act 198, the tenant – in this case, Barracuda Networks – can file an application for the tax abatement.

207.555 Application for industrial exemption certificate; filing; contents; notice to assessing and taxing units; hearing; application fee.
Sec. 5. (1) After the establishment of a district, the owner or lessee of a facility may file an application for an industrial facilities exemption certificate with the clerk of the local governmental unit that established the plant rehabilitation district or industrial development district.

Development District 317 Maynard: Public Hearing

Only one person spoke at the public hearing on the establishment of the IDD – Thomas Partridge. He lamented the loss of vitally-needed tax money through abatements, and contended that because of this, schools are becoming challenged to maintain standards of education and retain adequate numbers of teachers, especially special education teachers. Partridge asked recipients of tax abatements to voluntarily curtail the period of the tax rebates or forgo them. He allowed that the community needs jobs, but also needs to support our most vulnerable residents.

Development District 317 Maynard: Council Deliberations

Marcia Higgins (Ward 4), chair of the council’s budget committee, reported that the committee had met to consider the issue, but several committee members had not been able to attend. [Higgins participated in the committee meeting by speaker phone. Sabra Briere (Ward 1) attended in person, and was joined by city administrator Steve Powers, chief financial officer Tom Crawford, and Luke Bonner, an economic development specialist with Ann Arbor SPARK.]

317 Maynard is highlighted in yellow.

Aerial photo of 317 Maynard. The office space is located under the Maynard Street parking garage.

Higgins reviewed the distinction between the establishment of the district and the granting of the tax abatement: The parcel’s owner had applied for the establishment of the district, while the tenant, Barracuda, would be applying for the abatement.

The council was only authorizing the establishment of the district, she stressed. Only when the district is established, she said, would Barracuda be able to apply for the abatement. At that point, the city council’s budget committee would meet and review the application for an abatement.

Briere noted that some members of the community had been confused about who gets the benefit of the tax abatement, so she appreciated the explanation Higgins had offered. She noted that in the past, some districts had been established where no tenant had taken up the opportunity to apply for an abatement.

Mike Anglin (Ward 5) said he was sorry that he couldn’t attend the budget committee, but wondered if there were some preliminary figures. Higgins told him that some preliminary figures had been submitted, but she didn’t have them with her – but they looked promising, she said. Jane Lumm (Ward 2) expressed her support for the district, saying that the new jobs that Barracuda would be bringing is a positive development for the downtown.

Lumm agreed that the incentives being offered to Barracuda are warranted. Ann Arbor is an attractive location for businesses, she ventured, and it was not necessary to constantly offer tax incentives to attract businesses. Ann Arbor only does that on an infrequent and selective basis. She thinks this proposal is worthy of the support. She also pointed to a $1.2 million expansion grant from the Michigan Economic Development Corp. to Barracuda, and how the MEDC generally expected a local match.

Lumm had some remaining questions about the parking commitment. Higgins cautioned against diving into the details of the possible Barracuda proposal, until the application was final.

Mayor John Hieftje also said he didn’t think parking spaces would be presented to the council – because Barracuda would simply be taking advantage of a “special” being offered by the Ann Arbor Downtown Development Authority, which manages the city’s public parking system. [The DDA has offered incentives generally, not just to Barracuda, in the form of reduced rates on monthly passes for the new underground parking structure on South Fifth Avenue, which opened in July.]

Outcome: The council voted unanimously to establish the industrial development district at 317 Maynard.

Water Resources Commissioner: Flooding Solutions

The council considered a resolution directing city 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 bounded by Ann Arbor-Saline Road upstream to I-94 and Scio Church Road.”

Partial map of the area of study for the Malletts Creek drainage district.

The city council had heard complaints from residents in that area during public commentary earlier this spring about localized flooding.

The Aug. 7 primary election results from that precinct in Ward 4 were nearly decisive enough in favor of challenger Jack Eaton to win the Democratic nomination over incumbent Margie Teall – but his total fell short of Teall’s by 18 votes across the ward. [On Aug. 16, Eaton filed for a recount, which will likely occur later this month.]

The resolution considered by the council on Aug. 9 directs staff to bring an agreement to the city council with the water resources commissioner by Oct. 1, 2012.

Flooding Solutions: Council Deliberations

Stephen Kunselman (Ward 3) said he was intrigued by the proposal and asked Cresson Slotten to answer some questions. Slotten is a senior project manager with the city. He told Kunselman that there’d been similar studies done in other areas of the city. The area described in the resolution, he said, is part of an existing drainage district, Malletts Creek, that’s within the county’s jurisdiction.

Kunselman ventured that outside the city limits, drain improvements get assessed to property owners, but inside the city, the cost is paid for out of the city’s stormwater utility fund. Slotten explained that one of the benefits of working with the water resources commissioner’s office is the ability to work within the state’s “drain code,” which is the statute that establishes the water resources commissioner’s office. [.pdf of Act 40 of 1956]

Malletts Creek is a Chapter 20 drain under that code, Slotten said. A key point is that costs are assessed to the governmental entity, the city of Ann Arbor, based on how much of the area is in the city. Some of it would be in an area owned by the Michigan Dept. of Transportation near I-94, he said, so MDOT would also contribute a small share. The city could choose to assess property owners as well, but typically has chosen to treat it as a “system cost,” especially if it’s a broad project area. And by working through the county, it’s also possible to arrange financing over time, so that there’s not a large up-front cost, Slotten said.

Kunselman noted that the city owns most of the stormwater conveyance – streets, gutters, storm sewers – and at some point there’s an outfall into Malletts Creek. So he wondered how much is really under the county’s jurisdiction. Slotten described the portion of Malletts Creek that’s under the county’s jurisdiction – the open creek visible down by Briarwood Mall and Ann Arbor-Saline Road, where there is “open creek.” In addition, if you continue past Ann Arbor-Saline Road, you see some ponds, and upstream of that is a large pipe that’s a part of the drain. That drain continues up to Scio Church Road and then even up to Maple Road.

That’s the reason the partnership between the county and the city that has evolved over the years – given the intermingling nature of the physical systems – is so beneficial, Slotten said.

Mike Anglin (Ward 5) wanted to know how many dollars in damage Ward 4 had experienced during the localized flooding. Slotten was not certain, but ventured that those claims would have been made through the city’s insurance board. Marcia Higgins (Ward 4) pointed out that the insurance board report had been included in the consent agenda.

Jane Lumm (Ward 2) reported that this project had been discussed as part of the Malletts Creek coordinating committee meeting the previous day. She clarified that the agreement would come back to the council on Oct. 1 for approval.

Outcome: The council unanimously approved the resolution giving direction to start negotiations with the county water resources commissioner.

Demolition Contracts

The council was asked to approve two-year contracts with four different companies, to perform demolition services on an as-needed basis. The four companies are Bierlein, DMC Consultants, Beal, and Van Assche.

At its Feb. 21, 2012 meeting, the Ann Arbor city council had approved a $250,000 allocation for demolishing buildings that the city deems dangerous under Chapter 101 of the city code. The city would like to target buildings that are diminishing the quality of neighborhoods, dragging down property values and attracting nuisances. The city expects to be able to reimburse the general fund for that allocation, from the proceeds of a lawsuit settlement related to the old Michigan Inn property on Jackson Avenue.

Sandi Smith (Ward 1) described the resolution as giving the city some flexibility by having predetermined contractors that the city can call on, to demolish some blighted properties and allow the city to move quicker when the city gets to that stage. As an example, she gave the house on First and Kingsley. It’s located on property that the city purchased earlier this year – the vacant house is expected to be demolished later this month.

Mayor John Hieftje then asked Sumedh Bahl, community services area administrator, to talks about Avalon Housing‘s Near North affordable housing project, located on North Main. Houses on the site of the expected development have long stood vacant.

Bahl explained that if Avalon doesn’t move to demolish the buildings, then the city will. He explained that the city might start the process soon. It might take up to two weeks to finalize the contracts with the demolition companies and to make sure all the right types of insurance are in place, he said. In the meantime, the city will look disconnecting at the water utilities. There has to be a 10-day notice of any demolition, he said. So even if the city starts the next day with the process, you won’t see a bulldozer then. But in 45-60 days, the city will have the buildings down, he said.

Sabra Briere (Ward 1) noted that in the last year or so, she’d heard concerns from several councilmembers about houses that aren’t being maintained in the community. Being able to move forward as quickly as possible is a catch-phrase they’ve talked about, but she noted that it’s hard actually to move quickly. The contract approvals, which are not tied to any particular building, mean the city won’t have to jump through that extra hoop. It’s a tool that won’t be used lightly, she said.

Stephen Kunselman (Ward 3) said, “This is great.” He noted that the fund had been set up but he recalled that the amount of the fund was less than the $600,000 that you get when you multiple four contractors times $150,000 apiece. [The fund was set at $250,000.] So he wanted an explanation. Bahl explained that he would not be spending more than $250,000, but that the multiple contracts give him flexibility.

Bahl picked up on remarks by Smith and Briere that these demolitions would not be undertaken lightly. He described the due process that had to be used to demolish derelict houses.

Kunselman noted that the follow-up on the demolitions involves liens on the property and the proper paperwork so that the city can get reimbursed.

Kunselman also wanted to address the issue of the former St. Nicholas Church on North Main Street, which is currently under county tax foreclosure. Given that it’s in “the public hand,” Kunselman felt the city should be able to move quickly on that and take it down, because it’s no longer a private property. He noted that there’d been a house on Sharon Street when the county had cooperated with the city in that way.

City administrator Steve Powers observed that up to now, the city’s fund for demolition has been used as an incentive to property owners to do the work themselves – it’s a way to get a property owner’s attention. Regarding the St. Nicholas Church, Powers said that county treasurer Catherine McClary is well aware of the situation. She’d indicated that the county would be proceeding with demolition on the “county dime” but would be putting a lien on the property against that cost.

Smith asked Mike Appel, senior developer with the nonprofit Avalon Housing, to speak to the question of the Near North development. Appel told the council he appreciates the city’s patience and the whole community’s patience with the situation that he described as taking “too many months.” They’ve been working very hard to move the project forward, he said. They thought they could get the buildings taken down earlier, but now have been cooperating with city staff – by providing them with the asbestos surveys and the electric and gas utilities shutoffs. He said Avalon is doing everything in its power to get the houses down.

1992 FEMA floodway in light crosshatched blue, with the green lines indicating the boundaries of the floodplain. The intersection shown is Main and Summit. Red parcels are those that are now in the floodplain but previously were not. Green parcels were previously in the floodplain and now are not.

2012 FEMA floodway in dark blue, with the green lines indicating the boundaries of the floodplain. The intersection shown is Main and Summit. Red parcels are those that are now in the floodplain but previously were not. Green parcels were previously in the floodplain and now are not.

At this point, it appears that having the city do the demolition is quicker than doing it themselves, Appel said. The most recent event that’s slowed down the project is that in April of this year, the Federal Emergency Management Agency (FEMA) had issued new floodway and floodplain maps. The floodway had expanded considerably, he reported. The proposed building is not in the floodway, but some of the activities associated with the building are – like parking. The state would allow the project to be built, but the federal funds they’d been planning to use won’t be available. So now Avalon is trying to find a way to substitute non-federal funds for federal funds.

Outcome: The council unanimously approved the contracts with demolition companies.

Transit Articles of Incorporation

In front of the council for the third time were the articles of incorporation for a possible new countywide transit authority. The council had approved them twice before.

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 city of Ann Arbor, the city of Ypsilanti, Washtenaw County and the AATA.

This most recent iteration on the Aug. 9 agenda came in response to an amendment made by the Washtenaw County board of commissioners at its Aug. 1, 2012 meeting.

The county board’s amendment changed the minimum threshold of votes required on the proposed new 15-member transit authority board to change the authority’s articles of incorporation. That threshold was increased from a 2/3 majority (10 votes) to a 4/5 majority (12 votes). With a 7-4 vote, the Ann Arbor city council adopted the county’s change. Dissenting were Jane Lumm (Ward 2), Stephen Kunselman (Ward 3), Mike Anglin (Ward 5), and Marcia Higgins (Ward 4).

The council had already reapproved the transit documents once before, at its June 4, 2012 meeting, in response to a change to the four-party agreement that had been made by the Ypsilanti city council. The Ann Arbor city council had initially given its approval to the four-party agreement on March 5, 2012.

Transit Articles of Incorporation: Council Deliberations

Christopher Taylor (Ward 3) reviewed the history of the document approvals and the nature of the change that was being requested.

Sabra Briere (Ward 1) offered a possible explanation for wanting one super majority (4/5) compared to another (2/3). A concern she’d heard was urban versus rural. The cities of Ann Arbor and Ypsilanti, along with Pittsfield Township, would together have 10 members of the board. They could “conspire” to reduce the impact of the other members by changing the articles of incorporation. By asking for 12 instead of 10, it’s necessary to have a mix of urban and rural in order to change the articles of incorporation. The proposal of a 4/5 majority is a compromise between requiring unanimous approval and the original 2/3 majority, she said.

Tony Derezinski (Ward 2) asked Michael Ford, the AATA’s CEO, if the 4/5 majority were acceptable to the AATA. Ford said it was.

Jane Lumm (Ward 2) indicated she had no issue with the specific change. Her concern remains with the agreement itself. She suspected no one had changed their fundamental position on that question. She then reviewed her standard objections to the proposal.

Left to right: Tony Derezinski (Ward 2) and Ann Arbor Transportation Authority CEO Michael Ford.

Stephen Kunselman (Ward 3) felt that the “countywide” initiative would not be countywide at all and would end up being a regional Ypsilanti and Ann Arbor system. He felt there are better ways of accomplishing that. Kunselman then accused Ford of knowing the answers to some questions that Kunselman asked the last time Ford appeared in front of the city council. Kunselman said Ford had chosen not to share those answers. [Kunselman may have been alluding to the lack of specificity Ford provided when asked by Kunselman about the AATA's plans in case Ypsilanti was not able to meet the terms of its purchase-of-service agreement.]

Kunselman felt like the AATA has not been working in good faith and has been dropping the ball. He said it was not a countywide proposal, so he asked people to stop calling it that.

Mike Anglin (Ward 5) indicated that he’d vote against it because of the inclusion of Fuller Road Station as part of the plan. Having watched the county board of commissioners vote just 6-4 in favor of the agreement, he was not sure of the strength of the buy-in.

Carsten Hohnke (Ward 5) wanted to know what would happen if the council did not approve the change. Assistant city attorney Mary Fales explained that the document was binding only if all parties agreed to it. Hohnke indicated he was not interested in “belaboring the debate.”

Taylor indicated he’d support it for all the reasons previously discussed.

Outcome: The council voted to reapprove the articles of incorporation for the new countywide transit authority, with dissent from Jane Lumm (Ward 2), Stephen Kunselman (Ward 3), Marcia Higgins (Ward 4) and Mike Anglin (Ward 5).

Firefighters, Fire Truck

The council considered two agenda items directly related to fire protection: hiring three additional firefighters and authorizing the purchase of a new aerial truck.

Firefighters

The council was asked to authorize a revision to its FY 2013 budget that will allow for staffing of three additional firefighters for the next two years, bringing the budgeted staffing level for firefighters from 82 to 85. The positions will be funded with a $642,294 federal grant through the Staffing for Adequate Fire and Emergency Response (SAFER), which was announced earlier this year on May 30, 2012.

According to fire chief Chuck Hubbard, the city currently has three vacancies – which means 79 firefighters on staff.

The $321,000 from the SAFER grant for each of the next two years will be allocated for three firefighter positions, which the city estimates will cost $255,000 (at $85,000 per position). The remaining $66,000 per year will be spent on other unspecified fire services needs, according to the staff memo accompanying the resolution – including overtime and fleet expenses. Hiring a fourth firefighter would require using $19,000 of the city’s fund balance, according to the memo.

The budget amendment was anticipated based on the city council’s budget deliberations and final FY 2013 budget resolution earlier this year, on May 22, 2012, which directed the city administrator to submit a proposal to amend the budget and hire additional firefighters if the SAFER grant were to be awarded.

Jane Lumm (Ward 2) asks to be recognized to speak during the council’s Aug. 9 meeting. On the left is Tony Derezinski (Ward 2).

Jane Lumm (Ward 2) wanted to know what the $66,000 would be spent on. City administrator Steve Powers indicated that part of it would go toward overages already incurred. It would also be used to help pay for overtime, fleet expenses, and other fire service operations. The city is projecting a tight budget for FY 2013, Powers said.

Lumm wanted to know if the department was fully staffed at the budgeted level of 82. Hubbard indicated to Lumm that the approved budgeted level was 82. Powers clarified the question, which was essentially: Are we fully staffed? Hubbard indicated that right now the fire department has 79 firefighters – due to a retirements and recalled firefighters who did not return.

Sandi Smith (Ward 1) expressed concern about funding for firefighters in future years after the grant expires: What happens in two years? Hubbard indicated that in 2014 the city has the option to apply for another grant. Powers indicated that part of the rationale for hiring three firefighters instead of four is that the city’s projections are that it can sustain the staffing level of 85 when the two-year grant program is over. He allowed that one possibility is to reapply for the SAFER grant, but the city would prefer to fund the positions on its own.

Outcome: The council unanimously approved the budget change to allow the hiring of three additional firefighters.

Fire Truck

The council was also asked to authorize $1,043,685 from its fleet fund to purchase a new 2013 Sutphen model SPH100 mid-mount aerial platform – a “tower truck.” The department currently has two aerial trucks. The new purchase replaces a 1999 Emergency One brand 100-foot ladder truck – but it will be kept as a “reserve” aerial truck in the department. The department also has a 1996 Emergency One brand 100-foot aerial truck, which will be kept as a secondary aerial truck. Whichever Emergency One aerial truck first starts to have maintenance and repair costs that exceed its value will be retired from service – and the other truck will remain as a reserve.

The new truck is expected to arrive in 10-12 months.

Sabra Briere (Ward 1) noted that some constituents of hers who live in tall buildings were concerned about the city’s current tower truck functioning well. She wanted to know the difference between a ladder truck and a mid-mount truck.

Fire chief Chuck Hubbard explained that “mid-mount” is related to the way it’s built – on a mid-mount vehicle, the aerial component of the truck is mounted to the area just behind the cab. Responding to a question from Briere, Hubbard indicated that it’s not mid-mount versus rear-mount that determines how high the aerial platform can go, but rather the angle of inclination.

Briere said she’d heard that the city’s existing ladder truck had a weak piece that broke and couldn’t easily be fixed. Hubbard indicated that the new truck is very well built, made by a 100-year-old company. He felt that the issues with the existing truck had been well addressed in the purchase of the new truck – and indicated that replacement parts would be easy to acquire.

Mayor John Hieftje was keen to stress that the city’s ladder truck and tower truck were both currently back in service. And during the period when they were not in service, the “box-alarm” could have been used to get a tower truck from a neighboring jurisdiction. He ventured that long-term, it would make sense to think about a regional approach to those types of vehicles, saying that in many departments they are rarely used.

Responding to a question from Sandi Smith (Ward 1), Hubbard said there are more than 100 buildings in the city that are considered “high rises.” Smith asked if it wasn’t the case that they were likely fully-sprinkled – equipped with sprinkler systems under city code. Hubbard allowed that the codes are fairly strict. Hieftje asked city administrator Steve Powers to track down the percentage of high rise buildings that have sprinkler systems.

Responding to a question from Stephen Kunselman (Ward 3), Hubbard said that the preference for a platform instead of a ladder was based on ease of rescue. A ladder would require that a firefighter assist someone all the way down the ladder.

Kunselman got confirmation from Hubbard that the fire truck purchase is not connected at all to the possibility that the city will adopt a new station plan – operating out of three stations instead of the current five.

Mike Anglin (Ward 5) wondered if the number of firefighters required for operation of the truck was related to the “sway” of the truck. Hubbard said it has nothing to do with that, but rather with the number of tasks that have to be performed in connection with an aerial truck.

Outcome: The council unanimously approved the purchase of the aerial fire truck.

Nominations

The usual pattern for appointments to various boards and commissions is that their nominations are made at a council meeting and a vote is taken at a subsequent meeting.

Disabilities Commission: Petersen

Among the nominations for boards and commissions made by mayor John Hieftje at the city council’s Aug. 9 meeting was Sally Petersen to fill a vacancy on the commission on disability issues. Petersen will likely be joining the Ann Arbor city council itself in November, having received more votes than incumbent Tony Derezinski in the Aug. 7 Ward 2 Democratic primary. No other candidate will be on the ballot for Ward 2 on Nov. 6.

In announcing Petersen’s nomination, Hieftje said there was no reason to delay it. Petersen had also applied for appointment to the park advisory commission at the same time she’d applied for a spot on the commission on disability issues.

The commission on disability issues dates back to 1969, but has undergone several name changes since that time, including various forms of the word “handicap.” The commission was established to “promote and advocate for equal opportunities for all individuals with physical, mental and/or emotional disabilities.”

The city council will vote on confirmation of Petersen’s appointment at its Aug. 20 meeting.

DDA Nominations: Smith, Hewitt, Orr

Nominated for reappointment to the board of the Ann Arbor Downtown Development Authority are Sandi Smith, Roger Hewitt and Keith Orr. Those nominations were placed before the city council by mayor John Hieftje at the council’s Aug. 9 meeting.

This year’s DDA board officer elections, held  two months ago at the DDA’s July 2, 2012 annual meeting, again featured abstention on some votes by board member Newcombe Clark – because the future composition of the board was not yet clear. Hieftje’s custom for many reappointments to city boards and commissions has been to provide no public indication of his intentions on those nominations.

Communications and Comment

Every city council agenda contains multiple slots for city councilmembers and the city administrator to give updates or make announcements about important issues that are coming before the council. And every meeting typically includes public commentary on subjects not necessarily on the agenda.

Comm/Comm: Community Center

Orian Zakai addressed the council as an organizer for the Imagine Community – a nonprofit that promotes solidarity between homed and homeless people, she said, through skill-sharing and creativity. In the last four months, she said, they’ve been cooperating with an educational program at the local homeless shelter, the Delonis Center. Their goal for this year is to open a community center in Ann Arbor, where homed and homeless people can create social lives, learn from each other and stay out of the cold together. They’re waiting for someone to address what they see in the streets – growing desperation, more people out on the streets, insufficient social services, public health care and metal health assistance. They’ve proposed to the city to lease the empty 721 N. Main city-owned building and to take over responsibility for the maintenance of the building in order to make it a hospitable space for a community. She claimed that the city is more interested in costly business plans that would serve business owners and corporate interests than about creating community.

Addressing the contracts with companies that would perform demolition, she wondered what would be built in place of the houses to be demolished – parking lots, high rises and business centers? She said that mayor John Hieftje had been quoted as saying that we’re going to hand the city off to the younger generation and that he thinks young people want to live in a city center with a lot of activity. Contrasting with that sentiment was one expressed by Rose, a Groundcover News vendor, who said that community and not consumption is the next big thing. Zakai said that as a young-ish person, she wanted to live in a community – where people care about each other and no one is left out in the cold to fend for themselves – not a city center. If she had wanted that, she would have chosen to live in Chicago, Tel Aviv, or New York.

Comm/Comm: Democratic Progressive Agenda

Thomas Partridge introduced himself as resident of Ann Arbor and the 53rd District of the Michigan house of representatives. He called on the council and the public to stand up for democratic progress, and build a new Michigan by building affordable housing and re-electing Barack Obama. We need to take courage and stand up and call on our leaders to adopt significant agendas that will benefit the majority of residents. He called on the council to turn away from special interests and the charter amendment protecting city parks, and to focus instead on providing adequate funding to end homelessness, access to affordable housing and to city, countywide and regionwide affordable transportation.

Comm/Comm: Sustainable Practices

Kermit Schlansker recalled his time as a soldier in Germany during 1945-47 after World War II. What he saw was extreme poverty and food shortages, he said. People would trade cameras, radios and jewelry and other items for food. The German farmer was king, he said. His German wife told of going to cut a designated tree for fire wood and having to transport it a long distance in a pull-wagon.

Schlansker indicated that could happen in this country as natural resources get scarcer, and poverty will grow. Before it becomes a national catastrophe, many people will be suffering. We need a place where desperate people can go and trade a little work for food and a place to sleep, he said. We need a place where parolees and drug addicts can go and survive without stealing, he said. Sooner or later, poverty will be ubiquitous. The best remedy is to establish work farms located near cities – for growing food and energy, designing new products and starting new businesses.

Comm/Comm: Smart Meters

Darren Schmidt again addressed the council on the topic of smart meters – which are being installed by DTE Energy to allow for remote measurement of electric usage and for measurements in finer increments. He brought a device that he told the council could measure the effects of such smart meters. The device indicates with colored lights the amount of electromagnetic radiation, he said. He contended that DTE is controlling the Michigan Public Service Commission. Even though there’s an opt-out program, he said, what’s at issue is public airspace. He offered to show people the measuring device and reported that Matt Naud, the city’s environmental coordinator, had taken him up on the offer.

Comm/Comm: Citizens United

Stuart Dowty told the council that he was there to recruit them as a group to do something about the U.S. Supreme Court’s Citizens United decision. Ultimately, it’s about money, he said. CU means that we’re dealing with a fundamental change in the nature of our democracy – and something should be done about it. The Ann Arbor council should join the effort toward education about CU, he said. Bob Davidow told the council he’s a member of the group – the Washtenaw Coalition For Democracy. It’s important to understand, he said, that CU didn’t create a problem, but rather exacerbated a pre-existing problem.

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

Next council meeting: Monday, Aug. 20, 2012 at 7 p.m. in the council chambers at 301 E. Huron. [Check Chronicle events listing to confirm date]

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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 its July 2 meeting, the Ann Arbor city council had voted to set the Aug. 9 public hearing on the industrial development district. A letter dated June 1, 2012 from First Martin to the Ann Arbor city clerk requested the establishment of the district. First Martin is the owner of the property at 317 Maynard.

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]

Eunice Burns, former Ann Arbor city councilmember and Downtown Development Authority board member, introduces herself to city administrator Steve Powers before the July 2 council meeting started. Burns was on hand to receive a proclamation for Huron River Day, which falls on July 15 this year. Burns, along with Shirley Axon, is co-founder of the event. (Photos by the writer.)

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.

Sustainability Goals: Master Plan

The council considered a resolution directing the city planning commission to start a process of incorporating 16 sustainability goals into the city’s master plan. While that master plan review process is underway, the council’s resolution directs the city administrator to apply the 16 goals in staff work. [.pdf of 16 sustainability goals]

The sustainability goals are divided into four categories: resource management; land use and access; climate and energy; and community. By way of illustration, from the land use and access category, one of the goals is: “Establish a physical and cultural environment that supports and encourages safe, comfortable and efficient ways for pedestrians, bicyclists, and transit users to travel throughout the city and region.”

The goals were culled from more than 200 goals that are already found in existing city planning documents, as part of a project that began in early 2011. The work has been funded by a Home Depot Foundation grant.

Development of the work by city staff was initially guided by volunteers who serve on four city advisory commissions: park, planning, energy and environmental. Members from those groups met at a joint working session in late September of 2011. Since then, the city’s housing commission and housing & human services commission have been added to the conversation. A series of panel discussions on each category was held earlier this year, as was a public forum to solicit input.

The city planning commission voted on June 5, 2012 to recommend to the city council that it pass the resolution considered by the council on July 2.

Additional background on the Ann Arbor sustainability initiative is on the city’s website. See also Chronicle coverage: “Building a Sustainable Ann Arbor,” “Sustaining Ann Arbor’s Environmental Quality,” “Land Use, Transit Factor Into Sustainability,” and “Final Forum: What Sustains Community?”

Sustainability Goals: Public Commentary

Alan Haber told the council that in some circles he’s considered a pest. But he perseveres, he said. He supports the sustainability goals and he thinks they’re an important step. He related the notion of sustainability to the efforts of homeless people to organize their own community along the lines of Camp Take Notice. He then pointed to the city-owned building at 721 N. Main and contended that if the city made it available, that would help a community form, and that would be a part of the realization of sustainability goals.

Haber also contended that sustainability requires space for a community on top of the new underground parking structure on South Fifth Avenue. That space can change and create its own story, he said. When he attended a recent meeting of the Connecting William Street committee, which is working to develop possible scenarios for alternate uses of city-owned surface lots, all of the scenarios involved developing the top of the parking structure in some way. None of the scenarios allowed for open space there. The committee had not heard a word of the input that had been provided, he contended – because people all over town said they wanted an open space. That’s what the community wants, he said.

Kermit Schlansker.

Kermit Schlansker, a former engineer with Allied Bendix, told the council that the problem with wind and solar power is that it’s intermittent. A way to store the energy is needed, he said. He suggested that cisterns could be part of the solution. In the summer, he said, cistern water can cool buildings. In the winter, the use of a heat pump on cistern water – at 55 F degrees – would be relatively efficient, he said. Forget about rain gardens and rain barrels, he said, because they don’t store energy.

The big problem with cisterns, Schlansker said, is how to build them. The work of digging them has to be done by hand, but that would make jobs for poor people. He compared cistern digging to coal mining. The best way to store carbon is to leave it in the ground, he said. Like apartment houses, cisterns are one of the few energy devices that can last 1,000 years.

Sustainability Goals: Council Deliberations

At the July 2 meeting, Tony Derezinski (Ward 2) asked city planning manager Wendy Rampson to come to the podium. Rampson introduced Jamie Kidwell, sustainability associate with the city. Kidwell had done most of the work, along with some interns, Rampson said. City environmental coordinator Matt Naud and Rampson had assisted Kidwell, Rampson said. Kidwell ventured that many councilmembers had seen the sustainability goals through commissions and boards they sit on.

Derezinski asked Kidwell to give a succinct definition of sustainability. By way of responding to Derezinski, Kidwell noted that an effort had been made to build the vision of sustainability from existing planning documents. It’s from those documents that the four “chapters” were distilled: resource management; land use and access; climate and energy; and community. They build on the city of Ann Arbor’s 10 environmental goals that were adopted in 2007, she said.

Carsten Hohnke (Ward 5) asked Kidwell to talk about how we’ll know if the city is making progress. In responding, Kidwell alluded to the city’s State of Our Environment Report. She indicated that for sustainability, more detailed indicators would be developed along the lines of the environmental indicators. Those indicators will be tied to targets, she said, and she ventured that those indicators would be reviewed on a biennial basis.

Outcome: The council unanimously approved the resolution directing the planning commission to integrate the 16 sustainability goals into the city’s master plan.

Green Streets Policy

The council considered a resolution that directs city staff from a range of different departments to work with the environmental commission to develop a “green streets” policy.

The policy would formalize an approach to stormwater management that would allow street projects to incorporate an “array of products, technologies, and practices that use natural systems – or engineered systems that mimic natural processes – to enhance overall environmental quality and provide utility services …” The goals of developing and implementing the policy include a reduction in the amount of untreated stormwater flowing from streets directly to the city’s stormwater system and into the Huron River. By implementing systems like bioswales, for example, a portion of the stormwater runoff from streets, which includes contaminants from the road surface, would be filtered naturally before entering the river.

To emphasize the impact that the city’s streets have on stormwater runoff, a staff memo accompanying the resolution indicates that Ann Arbor’s 27 square miles includes 11.2 square miles of impervious surface, of which about one quarter (2.9 square miles) is the city right-of-way. City staff estimate that half of the runoff in the city’s stormwater system comes directly from the city right-of-way.

At the council’s meeting on June 18, 2012, city environmental commissioner Valerie Strassberg had addressed councilmembers, asking for their support in bringing the resolution forward. At that meeting, Sabra Briere (Ward 1) indicated she’d be bringing the resolution forward at the July 2 meeting. It was co-sponsored by Carsten Hohnke (Ward 5). Hohnke and Briere are the two city council appointees to the environmental commission.

The city staff who are directed to take part in the development of the green streets policy are in the systems planning, project management, field operations, parks and recreation, and planning departments.

The resolution was introduced by Briere. She noted that the city staff have already worked hard to implement various green streets approaches. However, the city has no policy about how to implement those approaches or what level of priority to assign them. She stressed that the green streets policy that will be developed by the environmental commission under the direction of the council’s resolution would come back to the council for its review. The council would then decide if the policy has been properly developed.

Hohnke characterized it as a move to provide formal guidance. City staff have been involved in the green streets techniques. And this approach has always been a growing part of how the city has thought about managing its streets, he said. Stormwater has an impact on infrastructure and the quality of our water, he continued. The city should bring new technologies to bear on this problem. Those technologies include pervious pavement and a “whole suite of actions that improve stormwater runoff.”

Jane Lumm (Ward 2) stated that she does support the resolution. She offered her thanks in advance to the staff and the environmental commission for the work they’d be doing. However, she wanted to add that when the green streets policy comes back to the council for review, she hopes to see supporting data that clearly articulates costs and benefits, including benchmark data with other cities. She noted that the council had recent approved a pervious pavement project, and it wasn’t clear what the capital and operational differentials were. She understood that a policy doesn’t mean something is set in stone. But she wanted a solid sense of the costs that are contemplated by the green streets policy.

Outcome: The council voted unanimously to direct the development of a green streets policy.

Huron River

The Huron River was featured twice during the meeting – in connection with a proclamation about Huron River Day, and during public commentary about park rules against swimming in the river.

Misty Lyn and the Big Beautiful from their Sonic Lunch performance during the summer of 2011. From left: Ryan Gimpert, Misty Lyn, Matt Jones, Carol Gray, Jim Roll.

Huron River: Huron River Day

The proclamation in honor of Huron River Day is an annual one. This year the celebration falls on July 15. Co-founders of the event – Eunice Burns and Shirley Axon – were on hand to receive the proclamation.

Burns put in a plug for one of the bands that’s playing this year: Misty Lyn and the Big Beautiful. She noted that her granddaughter, Carol Gray, plays in the band.

In her brief remarks to councilmembers, Burns told them that some new events are included this year, among them a triathlon. The three legs of the event require bicycling from Argo to Gallup, running a circuit on land around Argo Pond and then kayaking back down to Gallup. [Swimming is not a part of the triathlon.]

Huron River: Swimming

David Collins introduced himself as an avid canoeist and occasional swimmer. He told the council he wanted to address some signs he’d seen posted at the Argo Cascades [a new bypass around Argo Dam that includes a series of drop pools]. The posted signs indicate that no swimming is allowed pursuant to Chapter 39 of the city code, which Collins described as apparently prohibiting swimming from city-owned land adjacent to waterways, except for those areas that are designated for it.

By way of background, Chapter 39 reads in relevant part:

3:2. – Restrictions.
While in a park, no person shall:
…
(16) swim, dive or play golf or hockey except in areas specifically designated for such purpose.

The idea of swimming in the Argo Cascades had been discussed at the park advisory commission meeting on May 15, 2012, when commissioners ventured that it might be a way to deal with the heat. From The Chronicle’s coverage:

David Barrett ask about the possibility of people swimming in the pools of the cascades – especially as the weather gets warmer. Colin Smith [the city's parks and recreation manager] noted that there’s a park rule against swimming in the river using parkland as a bank. And given the level of boating activity in the cascades, he said, if the intent was to go for a relaxing dip, it wouldn’t be all that relaxing.

During his remarks to the council on July 2, however, Collins contended that the park rule was unenforceable. He appreciated the city’s interest in promoting safety and in protecting itself from liability. But the city, he contended, does not have the authority to enact an ordinance like Chapter 39 that restricts use of the river. He cited the public trust doctrine that governs riparian rights and referred to a state of Michigan publication – ”Public Rights on Michigan Waters“:

It is quite clear that although a riparian owns the fee to the bed of a navigable (public) stream, his ownership is subordinate to the right of the public to the free and unobstructed use of the stream for navigation, fishing, swimming and other uses inherently belonging to the public.

Collins noted that if the city “invites guests,” it might have additional responsibility. For open and obvious dangers, he said, the city did not have liability. Only when the risks are hidden dangers are there real issues, he said.

Rather than post warnings about violations of an abstract, unenforceable piece of the city’s code, Collins suggested that the signs should provide warnings about real danger – like sharp, hidden rocks. That kind of sign could be more effective to prevent people from trying to use the Argo Cascades chutes as a water slide.

Barracuda Tax Abatement

The council considered setting 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 to apply for the abatement. The city council will need to vote to set another public hearing – this time on the abatement. And then the council will need to vote on the abatement itself. According to reports from Barracuda, the value of the abatement to be requested is estimated at around $85,000.

The city is prohibited by state statute from abating taxes on any more than 5% of the total state equalized value (SEV) of property in the city. Responding to an emailed query in May 2012 (in connection with a tax abatement for Sakti3), Tom Crawford, the city of Ann Arbor’s chief financial officer, wrote to The Chronicle that total SEV for the city for 2012 stands at $5,294,974,640, and the total SEV of abated property in 2012 is $8,935,974. That works out to 0.169% – well under 5%.

Outcome: Without discussion, the council voted to set a public hearing for Aug. 9, 2012 on establishing an industrial development district for 317 Maynard St.

Shell Station Rezoning, Site Plan

The council considered final approval of a request to revise the zoning regulations associated with the parcel on the northeast corner of Ann Arbor-Saline and West Eisenhower Parkway, where a Shell service station is located.

The city planning commission had previously voted unanimously to recommend approval of the zoning changes at its April 17, 2012 meeting.

The council was also asked to consider the site plan for the project.

Owners of the station are asking for revisions to the site’s planned unit development (PUD), which would allow them to build additions onto the existing 1,000-square-foot convenience store. The new additions would total 4,089 square feet, including 2,189 square feet to the north and east of the store. Their plan also calls for converting the 900-square-foot carwash area into new retail space. The existing access drive to the carwash would be landscaped, and the parking lot would be reconfigured for a new total of 16 spaces.

According to a planning staff memo, the PUD revisions were recommended because they are seen as providing an overall benefit to the city, by: (1) supporting the continued viability of retail options for the surrounding neighborhood; (2) creating job opportunities from this expansion; and (3) controlling the architectural design standards of this building as a gateway into the city.

The initial approval to the PUD rezoning was given at the council’s May 21, 2012 meeting.

Shell Station: Public Hearings

Separate public hearings were held on the PUD rezoning and the site plan.

Thomas Partridge was the only person who spoke at either hearing. He introduced himself as a resident and candidate to represent the 53rd District in the Michigan house of representatives. He called on the city council to come together behind a specific and firm commitment to affordability goals and environmental goals as part of the sustainability goals that were on that evening’s agenda. Those goals should include a commitment by service stations to support the public transportation system, he said. Service stations should be required to provide charging stations for electric vehicles, he contended. They should also be required to provide adaptable technology for hydrogen-powered vehicles.

Partridge called for the zoning change to be revised to require access to affordable housing.

Outcome: Without discussion, on separate votes, the council unanimously approved the site plan and rezoning request for the Shell station at the northeast corner of Ann Arbor-Saline and West Eisenhower Parkway.

City Membership in Washtenaw Health Initiative

The council considered a resolution that allows the city of Ann Arbor to become a member of the Washtenaw Health Initiative (WHI). The resolution altered the budget for fiscal year 2013 (which began July 1, 2012) by adding $10,000 of general fund money to the budget for the office of community development – to cover the membership fee for this year. The resolution also recommends consideration of renewing the membership next year. [The city of Ann Arbor adopts budgets only one year at a time.]

A goal of 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 goal is to develop a plan to provide better health care for the county’s low-income residents, the uninsured and people on Medicaid – prior to changes that will be mandated by the federal Patient Protection and Affordable Care Act, recently upheld by the U.S. Supreme Court.

Currently, 2,719 people in Washtenaw County are already eligible for Medicaid but not enrolled – and of those, 958 are city of Ann Arbor residents.

The WHI is a collaboration co-chaired by former county administrator Bob Guenzel and retired University of Michigan treasurer Norman Herbert, along with Ellen Rabinowitz, executive director of the Washtenaw Health Plan. The effort is jointly sponsored by the UM Health System and Saint Joseph Mercy Health System, and facilitated by Marianne Udow-Phillips, director of the Center for Healthcare Research & Transformation – a joint venture of UM and Blue Cross Blue Shield of Michigan.

Other partners involved in the project include the Ann Arbor/Ypsilanti Regional Chamber of Commerce, Arbor Hospice, Catholic Social Services, Dawn Farm, Hope Clinic, Huron Valley Ambulance, Integrated Health Associates, Packard Health, Planned Parenthood of Mid and South Michigan, United Way of Washtenaw County, and the Women’s Center of Southeastern Michigan.

The Washtenaw County board of commissioners voted on April 4, 2012 to make the county a member of WHI – and approved the $10,000 membership fee. The city and county are two of over 30 members of WHI, who have together contributed more than $100,000 to the effort.

Washtenaw Health Initiative: Council Deliberations

Appearing before the council were Bob Guenzel, community co-chair of WHI, and Marianne Udow-Phillips, director of the Center for Healthcare Research & Transformation. CHRT is facilitating the initiative, Udow-Phillips told the council.

Sabra Briere (Ward 1) noted that when the council had been briefed about the initiative at a previous working session, councilmembers had been told they’d eventually be asked for funding. Briere asked: What will the $10,000 help accomplish? Guenzel noted that WHI has been a voluntary effort led by the two major health systems in the area – the University of Michigan Health System and Saint Joseph Mercy Health System. Guenzel continued by saying that retired Saint Joseph Mercy Health System CEO Bob Laverty had started the effort and that Udow-Phillips had provided her organization’s support. The first year and a half, Guenzel said, the entire effort had been voluntary. They’d decided they didn’t want to incorporate as a 501(c)(3).

Instead, he said, they’re asking entities to become charter members of the organization. Many of the member agencies contribute in-kind support, he said – like the hospitals and safety-net clinics. For next year, Guenzel said, they’ve developed a budget of about $100,000. That will ensure the availability of a dedicated employee from Udow-Phillips’ CHRT.

Guenzel told the council that WHI had approached the two major health systems for support and they’d agreed to help with $30,000 each. But the two health systems also wanted the community to contribute a piece of the support. Guenzel said that WHI had asked the Ann Arbor Area Community Foundation, United Way and the Washtenaw County board of commissioners for $10,000 a year. So WHI was now asking the city to contribute the same amount that the county had contributed.

Guenzel felt that this approach is effective and efficient. CHRT has made a great commitment, he said, in terms of their expertise and their ability to draw other agencies together. Whether the Affordable Health Care Act was upheld or not, Guenzel said, WHI thinks the initiative is important. The Supreme Court ruling meant that it had gotten over one hurdle, but he expected there would be others.

Guenzel concluded by allowing he’d given a long answer to Briere’s question. Briere told him it had been a good answer.

Briere followed up by asking how WHI will dovetail with what the state of Michigan does. Udow-Phillips responded to Briere’s question by saying that assuming the state moves ahead with Medicaid expansion, the WHI efforts will help the community plan to provide access to health care for those who’ll be newly insured. Even if the state does not move ahead with an expansion of Medicaid, she said, then the state or the federal government will move ahead by establishing a health care exchange. That will result in 300,000-400,000 people in Michigan who will get subsidies to buy private health insurance. Many of those people will be in Washtenaw County, she said, so by planning, the county’s health care system will be able to serve these newly-insured people.

In Washtenaw County, Udow-Philips continued, there are about 28,000 people who are uninsured. About 13,000 of those would be eligible for Medicaid under a Medicaid expansion, and most of those would be eligible for a subsidy to purchase private insurance, if that’s the route that’s taken.

Tony Derezinski (Ward 2) said he’s happy to hear this news. Ann Arbor is a great place to retire, he said, because of the quality of the health care. He asked Udow-Philips if she’d looked at other community health plans before developing an approach. She indicated that the model was Massachusetts – and the planning that Massachusetts had failed to do. When more people became eligible, there were not enough providers to give them access, she said. Massachusetts had not done the kind of planning WHI is doing in this county, she said. Once the Affordable Health Care Act was passed, the WHI organizers decided they wanted to do the necessary planning. No other counties are doing the kind of planning WHI is doing, she said. She’d like Washtenaw to be a role model for other counties in Michigan.

Carsten Hohnke (Ward 5) thanked Udow-Philips for her efforts. If it turns out that WHI determines there’s a lack of health care capacity compared to the needs of the newly-insured, Hohnke wanted to know what some of the options are for expanding that capacity. Udow-Philips told Hohnke that they’re in the final stages of that analysis right now. Both major health systems are bringing in more practitioners to Washtenaw County, she said. But it’s important to make sure those practitioners serve the Medicaid population. So WHI is working with major safety-net providers – like the Packard Clinic, Ypsilanti Family Practice and the Taubman Center – to make sure practitioners will be available. Udow-Philips stressed that not just doctors are considered practitioners – it could mean nurse practitioners, she said. The preliminary numbers would be looked at the following week, she said, to look at what the gap in capacity might be.

Outcome: The council voted unanimously to approve the $10,000 of support for the Washtenaw Health Initiative.

Commission Appointments

The council considered confirmation of four nominations to three different commissions; all nominations had been made at the council’s previous meeting, on June 18, 2012.

Toward the end of the July 2 meeting, Ken Clein and Kirk Westphal were considered as appointments to the city planning commission. The late agenda slot is reserved for confirmation of mayoral nominations. The vast majority of board and commission appointments are made by the mayor.

However, nominations to the environmental commission and the greenbelt advisory commission are made by the council as a body. So those confirmation votes came relatively early in the meeting as a part of “council business.” The council considered John German’s nomination to the city’s environmental commission and Archer Christian’s nomination to the greenbelt advisory commission.

Appointments: Christian to Greenbelt

On the greenbelt advisory commission, Christian is replacing Mike Garfield. Garfield is director of the Ecology Center, a nonprofit based in Ann Arbor, and Ms. Christian is the center’s development director. Garfield was term-limited as a GAC member, having served two consecutive three-year terms. The spot vacated by Garfield is not designated for a representative of the Ecology Center. However, the nine-member commission includes two slots for representatives of environmental and/or conservation groups. The greenbelt advisory commission oversees the proceeds generated by two-thirds of the city’s open space and parkland preservation millage, which is levied at a rate of 0.5 mills.

Council deliberations were brief. Carsten Hohnke (Ward 5), who serves as the city council’s representative to the greenbelt advisory commission, reminded his colleagues that Ms. Christian is filling a slot on the commission designated for someone who works with a conservation organization. Christian also has a long history of involvement in land conservancy, Hohnke said.

Outcome: The council unanimously confirmed Archer Christian’s appointment to the greenbelt advisory commission.

Appointments: German to Environmental

John German’s term on the environmental commission expired in August 2011, but he has continued to serve. His nomination and confirmation amounted to formalizing what was already the case. German’s background includes work with Chrysler, the U.S. Environmental Protection Agency, Honda, and the International Council for Clean Transportation.

Ann Arbor’s environmental commission was established 12 years ago through a city ordinance, with the charge to “advise and make recommendations to the city council and city administrator on environmental policy, environmental issues and environmental implications of all city programs and proposals on the air, water, land and public health.”

The council’s deliberations consisted of a reminder from Sabra Briere (Ward 1), one of the council’s representatives to the environmental commission, that German is currently serving on the commission, that his re-appointment was missed at its time of renewal last year. So the appointment the council would be making, she said, would extend retroactively. The three-year term would thus end on Aug. 7, 2014.

During her communications time, Briere also announced that applications for a vacancy on the commission would be considered at the commission’s next meeting. She encouraged people to apply.

Outcome: The council voted unanimously to confirm John German’s appointment to the environmental commission.

Appointments: Clein, Westphal to Planning

On the city planning commission, Ken Clein, a principal with Quinn Evans Architects, replaces Erica Briggs, who did not seek re-appointment. Among the architectural projects Clein has worked on locally are the University of Michigan’s Hill Auditorium renovation, the new Ann Arbor municipal center, and the Zingerman’s Deli expansion.

Kirk Westphal’s appointment was a re-appointment. Westphal is principal at Westphal Associates, a firm that produces video documentaries. He holds a master’s degree in urban planning from the University of Michigan. City planning commissioners serve three-year terms.

Outcome: The council voted unanimously to confirm the appointments of Ken Clein and Kirk Westphal to the planning commission.

Labor Agreements

The council considered separately three collective bargaining agreements with members of the Teamsters Local 214: with the police professional assistants (4 employees), the deputy chiefs (2 employees) and the civilian supervisors (~30 employees). Robyn Wilkerson, human resources and labor relations director for the city of Ann Arbor, responded to questions from Jane Lumm (Ward 2).

From left: Marcia Higgins (Ward 4) confers with Jane Lumm (Ward 2).

Lumm had questions about the new-hire pension program, which the city began implementing for its employees last year. It involves increasing the vesting period for the pension program from five years to 10 years, and calculating the pension based on a final average compensation of five years instead of three years. All of the collective bargaining agreements include no wage increase, but instead a lump sum payment of $1,000. The contracts for all three units are for two years, through June 30, 2014.

Wilkerson clarified for Lumm that the same pension program language is in previous agreements – for police and fire department employees. It’s now officially city-wide. Lumm inquired if it had been discussed by the council’s labor committee. Marcia Higgins (Ward 4) indicated that the policy had been considered and moved forward in June 2011.

Higgins, who serves as chair of the council’s labor committee, explained that the contracts came up quickly on the council’s agenda because the items move to the agenda when the bargaining units ratify the contracts. City administrator Steve Powers confirmed that the collective bargaining units had just ratified the agreements the previous Thursday. Lumm briefly mulled the possibility of asking for postponement, but decided simply to express her view that she feels strongly that the city needs to move to a defined contribution plan instead of the defined benefits plan it currently has. She reminded her colleagues that she had been prepared to bring forward a resolution on the night they’d deliberated on the FY 2013 budget – a resolution that would have directed the development of a defined contribution plan. That night she’d declined to put the resolution before the council, due to the meeting’s late hour, but she indicated at the July 2 meeting that she’d bring the proposal to the council’s budget committee.

Stephen Kunselman (Ward 3) observed that with the move to shorter, two-year contracts, the city would basically be in a phase of continuing negotiations. Wilkerson pointed out that they are all two-year agreements with wage re-openers after one year. She observed that since the state legislature has passed a law regulating how much public employers could contribute to employee health care, it means that the focus of the bargaining is on wages. Kunselman ventured that there would be plenty of time to address the issues if concerns come up.

Lumm asked how many employees were in the group of civilian supervisors. Wilkerson told her it was about 30. Lumm wanted to know if Wilkerson had a sense of how many new hires would be made in that category. Wilkerson indicated that based on what she was seeing in other departments, she thinks there will be a significant increase in retirees.

Outcome: On three separate votes, the council unanimously approved the collective bargaining agreements.

Weapons Screening Contract

On the July 2 agenda was a resolution to approve a contract with the Washtenaw County sheriff’s office. The city would pay $187,000 annually for the sheriff’s office to provide weapons screening services for the 15th District Court, located inside the city’s new justice center building at the corner of Fifth and Huron.

The contract pays $25.25 per hour per officer, with the number of officers estimated to be roughly three each day. Currently, the weapons screening takes place at metal detectors at the building’s entrance.

During the brief council deliberations, Jane Lumm (Ward 2) recalled the council’s previous discussion about the location of the security checkpoint within the building.

The city council engaged in lengthy deliberations at its April 2, 2012 meeting about the placement of the security check. The context of those deliberations was a vote on the acquisition of Ed Carpenter’s proposed “Radius” sculpture, at a cost of $150,000, to be installed in the lobby of the justice center building. As proposed, and eventually approved by the council, viewing the sculpture from inside the building during normal business hours would require going through a security check.

Lumm asked about a meeting of the city council’s building committee that had been mentioned at the time. City administrator Steve Powers told her that a meeting of that committee had been set for July 16. The meeting will include a discussion of the location of the security checkpoint.

Ballot Questions

The Ann Arbor city council has until its second meeting in August to put various questions before voters on the Nov. 6, 2012 ballot.

Ballot Questions: Charter Amendment on Leasing Parks

During communications time at its July 2 meeting, the council heard from Jane Lumm (Ward 2) that she and Mike Anglin (Ward 5) are working to bring a ballot question to Ann Arbor voters that would further tweak a city charter provision related to the sale of parkland.

The charter provision had been approved in November 2008 by a 81%-19% margin (42,969 to 9,944). The tweak would involve adding actions like “lease,” “license,” or “re-designate” to the set of actions on city parkland that require a voter referendum.

The 2008 ballot question had asked voters if they wanted to add a clause to the city charter that would prevent the sale of city parkland without a voter referendum. Michigan’s Home Rule City Act already lists among a city’s prohibited powers: “… to sell a park, cemetery, or any part of a park or cemetery, except where the park is not required under an official master plan of the city …” But that year some residents were concerned that the city was looking to sell Huron Hills golf course – and they saw the exception in the state statute as a possible loophole. The council voted to place the question before voters that year over dissent from councilmember Marcia Higgins (Ward 4) and former councilmember Leigh Greden.

That year, the council had consciously settled on wording that included just selling, as opposed to leasing. In an Oct. 31, 2008 Ann Arbor News article, mayor John Hieftje was quoted as follows: “From time to time, we’ve thought about how nice it might be to have a restaurant near the river. I think it’s something people would really enjoy … That would be impossible if the ballot measure was expanded to include leasing.”

What prompts the current desire to contemplate adding “leasing” and other arrangements to the mix is concern that a portion of Fuller Park could eventually be used for a new rail station. Amtrak currently operates a station on Depot Street near the Broadway bridges. [See coverage of the council's June 4, 2012 meeting, when it accepted a $2.8 million federal grant to complete a planning study to confirm the Fuller Road site as the locally preferred alternative location for a new rail station.]

One draft of the ballot question that Lumm and Anglin are crafting reads: “Shall the voters of the City of Ann Arbor amend the city charter to require that the city shall not sell, lease, license, re-categorize or repurpose, without the approval, by a majority vote of the electors of the city voting on the question at a regular or special election, any city park, or land in the city acquired for a park, cemetery, or any part thereof?” Lumm indicated that she’d bring the resolution to the council for a vote at its July 16 meeting.

Mike Anglin (Ward 5).

Lumm recounted much of the history of the previous charter amendment and thanked assistant city attorney Mary Fales for her help in drafting the ballot question.

Later during a second round of council communications, Anglin followed up on Lumm’s remarks. He described the history of the 2008 resolution as not enjoying support from some environmental groups – saying that many people knew the language was imperfect when it was presented. Still, Anglin said, the charter amendment was a way of moving something forward that was needed at the time. There’s always been a group of people who are interested in how to further protect our parks, he said. When the PROS (parks and recreation open space) plan was adopted [at the city council's March 7, 2011 meeting], Anglin said he refused to voted for it because he felt that the plan was not as assiduous as it should be about protecting the city’s own land.

From The Chronicle’s coverage of Anglin’s opposition to the PROS plan in early 2011:

Mike Anglin (Ward 5) weighed in saying that he was 95% in favor of the plan but had some problems with it that would lead him to vote against it. He then read aloud a statement with objections, including issues with the proposed Fuller Road Station and public-private partnerships in the parks.

Speaking about the upcoming charter amendment resolution, Anglin allowed that there are a number of “tricky” items in it. But he felt it’s important to continue to work to fulfill the intent of the 2008 charter amendment. He said he’d be talking to individual councilmembers about it, and he hoped it could make it onto the ballot in November.

Ballot Questions: Park Maintenance & Capital Improvements Millage

While council support for placing a parkland lease question on the November 2012 ballot is uncertain, it’s likely that the council will follow the park advisory commission’s recommendation to place a renewal of the parks maintenance and capital improvements millage on the ballot. Christopher Taylor (Ward 3), who is one of two council ex officio members of PAC, indicated that consideration of that millage question would take place at the council’s July 16 meeting.

Taylor described PAC’s approach in evaluating the millage renewal as a long and diligent process to put the renewal of the existing parks millage before voters in November. PAC has also recommended that the council re-affirm the administrative policies that guide the use of the taxes generated by the millage.

Ballot Questions: Art, Non-Partisan Elections?

Other possible ballot questions that have received some consideration by councilmembers include a charter amendment that would make city elections non-partisan.

And during deliberations on May 7, 2012 about a piece of public art to be commissioned for the city’s new justice center, Stephen Kunselman (Ward 3) mentioned the possibility of establishing a millage just for public art. That would require placing a question on the ballot.

Locally, any city of Ann Arbor ballot questions might be joined by one that is likely to be put forward by the Ann Arbor District Library to support a downtown building project. A countywide transportation millage is less likely to be placed on the November ballot, given the delays in approval of all the necessary documents.

Communications and Comment

Every city council agenda contains multiple slots for city councilmembers and the city administrator to give updates or make announcements about issues that are coming before the city council. And every meeting typically includes public commentary on subjects not necessarily on the agenda.

Comm/Comm: Voting

During his turn at public commentary at the conclusion of the meeting, Thomas Partridge called on all clerks in all jurisdictions in the next few days to promote voter registration before the deadline [July 9, 2012 for the Aug. 7, 2012 primary].

Example of a voter registration card recently mailed to Ann Arbor residents.

It’s important that citizens express themselves at the polls, Partridge said. Voting should be made more accessible and barriers to voting must be removed, he said. It should also be possible to vote without producing undue amounts of personal information and documentation. He also stated that serious consideration should be given to internet voting in the state of Michigan

And during his communications time at the start of the meeting, city administrator Steve Powers noted that residents have received in the mail an updated voter registration card. The reason for that is related to redistricting in connection with the 2010 census. The outcome of the changes in the city ward boundaries had not changed the voting location for the vast majority of residents, Powers noted, but the notification is required by law to be sent out.

Comm/Comm: Pool Closing

During his communications time, city administrator Steve Powers reported that the closure of Veterans Memorial Park pool had been caused by a pump failure – caused by a small towel getting into the mechanism. Staff are looking at ways to prevent that in the future, he said. [The pool is expected to be closed until July 11, 2012.]

Comm/Comm: 4-3 Jackson Lane Conversion

At its April 2, 2012 meeting, the Ann Arbor city council voted to submit a request to the Michigan Dept. of Transportation to convert the segment of Jackson Road between Maple Road and South Revena from four traffic lanes to three. At the council’s July 2 meeting, during his communications time, Mike Anglin (Ward 5) called that action by the council premature. [He and Jane Lumm (Ward 2) had voted against submitting the request.] Because of the public outcry, Anglin said, MDOT had scheduled another meeting: on Tuesday, July 10 from 5-8 p.m. at Abbott Elementary School, 2670 Sequoia Parkway.

Anglin said that commuters, who will be affected by the conversion, are also part of the community. He allowed that he’d also heard from members of the bicycling community on the issue [many of whom support the lane conversion].

Comm/Comm: Affordable Services

As he typically does, Thomas Partridge addressed the city council at the beginning of the meeting during public commentary reserved time and at the conclusion of the meeting as well. During his first turn at public commentary, he told councilmembers he’s running for state representative in the 53rd District of the Michigan house of representatives. He called for greater attention to affordable housing, transportation, health care and education. He also stated that it’s important to provide economic development and job growth for the city, the county and the region. As a representative, he said, he’d take on these goals and build from the ground up and fully fund these areas.

Comm/Comm: Smart Meters

Several people reprised public commentary from previous council meetings – on the topic of “smart meters,” which can record electricity consumption at relatively small intervals (less than an hour). The meters then communicate that usage information to the utility for monitoring and billing purposes. For the first time at an Ann Arbor city council meeting, a resident questioned the scientific and health claims made by those who oppose installation of the meters.

DTE smart meter.

Linda Kurtz expressed her objection to smart meters based on health effects. She described the biological mechanism by which smart meters affect the human body – by disrupting the regular voltage differences across cellular membranes. RF radiation dislodges calcium ions and causes membranes to leak, she contended, and it disrupts the blood-brain barrier.

Carol Neylon called it unconscionable that DTE has been allowed to install smart meters. She cited a multitude of independent issues, including personal privacy concerns and health issues. She contended that in Toronto, where such meters had been installed, the impact had been that customers received higher bills. She was concerned about the ability of DTE to shut off someone’s power remotely and to track energy usage 24/7. She characterized smart meter installation as being about a big company doing whatever it takes to make profits.

Bethanni Grecynski cited privacy concerns. She expressed concern about the ability to hack the system and obtain people’s energy consumption information. Although an option was being discussed to opt out of smart meter installation, she contended that it would cost $50/month. Many people can’t afford to pay that. She also contended that the smart meters can cause people’s bills to go up. She questioned whether it’s fair that only the rich can opt out – that didn’t seem like an American idea to her.

But her real interest, said Grecynski, is health. She allowed that statistics have shown the smart meters are safe – but she asked councilmembers to remember how cigarettes and processed food were once thought to be safe.

Nanci Gerler told councilmembers that she’d lived in Ann Arbor 44 years. She noted that she had appeared before the city council previously. She’s not happy about the continued installation of smart meters in the community. A recent meeting about smart meters held at Crazy Wisdom bookstore was standing-room only, she reported, so concern is growing. She noted that a Michigan Public Service Commission (MPSC) report recommends an opt-out provision. Now, she said, DTE has 90 days to respond. But in the meantime, the community will be saturated with smart meters, she said. She contended that the effect is already palpable for those who are hypersensitive to electromagnetic radiation.

Michael Benson introduced himself as a Ward 2 resident, but wanted to address the council as a graduate student in the University of Michigan radiation laboratory. He deals with electromagnetic radiation on a regular basis, he said. He’s not an expert, he allowed, but felt it was appropriate to provide a few facts. He noted that public commenters had said that smart meters provide additional RF radiation – sure, that’s true, he said. A cell phone, or a computer, or even the microphone he was speaking into are radiating a little bit. The FCC provides standards for levels of radiation that are acceptable, he continued, and testing is done by the NIH (National Institutes of Health). Cell phones operate at a maximum of 1W of transmitting power compared to smart meters at 250 mW – or about 1/4 the level of a cell phone, he said. Those figures are the maximum – and they’re often below that, he said.

Benson also observed that during public commentary, councilmembers had heard about electromagnetic hypersensitivity. He contended that WebMD is a pretty good reference source for medical conditions, and this condition is not listed on WebMD. Benson told the council he was not there to comment on the public policy issue of smart meters, but as far as the science goes, he suggested that councilmembers take everything they’d heard “with a grain of salt.”

By way of anecdotal illustration, no apparent impact can be seen on The Chronicle’s measured residential electricity use since installation of a smart meter in March 2012:

Over the last four fiscal years, electricity usage at The Chronicle’s residence has shown essentially the same seasonal variation. Green bars are the most recent year. Lines are previous years.

In this gas-furnace house (thermostat 60 F), supplemented by electric space heaters, the electricity usage (blue bars) patterns with heating/cooling degree days.

Comm/Comm: Dream Nite Club Lawsuit

During his communications time, city attorney Stephen Postema told the council that before that night’s meeting, Tony Derezinski (Ward 2) had asked Postema to mention the Dream Nite Club cases. [The city had taken steps that led to the revocation of the club's liquor license. For some previous Chronicle coverage, see the March 19, 2012 city council meeting report.]

Four significant rulings – two in federal court and two in state court – had gone the city’s way, Postema reported. The ruling illustrated the importance of the process the city followed, he said. The courts had upheld every aspect of the city’s action. Postema stressed that a liquor license does not involve just rights, but also responsibilities.

Postema described Derezinski’s handling of the liquor license hearing, over which Derezinski had presided, as requiring “great patience.” Postema felt like the judges in the cases had read the entire transcript of the hearing. The conclusion had been that all the due process elements were met. Postema stated that the city was ready to be challenged, and it was gratifying to have the courts confirm the city’s position. He also emphasized that the entire process associated with revoking the Dream Nite Club liquor license had taken a lot of work – and people sometimes forget the amount of work that it takes to do the business of the city.

Not reported by Postema to the council at their meeting was the filing earlier that day, July 2, of a motion to set aside the judgment that had been made against the Dream Nite Club owners by judge Paul Borman. The motion seeks to set aside the judgment and to file an amended complaint. The amended complaint lists out a number of specific allegations, including the use of racial epithets by individual Ann Arbor police department officers in their interactions with Dream Nite Club management staff. The amended complaint alleges that AAPD officers had indicated a desire to shut down the club because of its black clientele, and had scrutinized black patrons in a manner that white patrons were not forced to undergo.

The original complaint did not include those specific allegations.

Borman’s opinion in dismissing the case had been based on the unamended complaint. Borman’s ruling relied in part on a U.S. Supreme Court case, Ashcroft v. Iqbal (2009).

Defendant City of Ann Arbor’s increase in police activity outside of Plaintiffs’ nightclub after a violent incident may have incidentally impacted the racial minorities who happen to patronize Plaintiffs’ nightclub, but the purpose of increasing the police presence was not to target racial minorities. The facts alleged impel the conclusion that police activity increased as a result of crime at and in the vicinity of the nightclub. Thus, Plaintiffs’ conclusory allegations of racial animus “are … not entitled to be assumed true.” Iqbal, 556 U.S. at 681.

Inferring racially discriminatory intent from the sequence of events alleged in the Complaint, as Plaintiffs ask the Court to do, requires an inferential leap that is not supported by the facts.

The Iqbal case was significant, because it’s been analyzed as signaling a change in the basic way that courts are supposed to consider motions to dismiss a case. Following Iqbal requires district courts to distinguish allegations that are statements of fact from those that are conclusions of law. It’s been analyzed as a return to “fact pleading” – which requires a claim to include all the relevant facts in support of the claims that have been asserted. From 1938 until Iqbal, the prevailing system had been “notice pleading,” which requires only sufficient facts to put someone on notice about the claims asserted against them. Under “notice pleading,” the expectation is the facts would be introduced partly under the discovery process – where a plaintiff would be able to depose witnesses and subpoena additional documents from a defendant.

Comm/Comm: Human Rights

Sandi Smith (Ward 1) who also serves on the city’s human rights commission, announced that the commission is partnering with the Michigan Department of Civil Rights to hold a public hearing on Thursday, July 12, from 6:30-9 p.m. in the city council chambers in city hall. The purpose of this hearing is to hear testimony on discrimination based on sexual orientation and gender identity – especially as it relates to the Elliot-Larsen Civil Rights Act.

Comm/Comm: Nuclear Weapons

Odile Hugonot Haber addressed the council on the topic of nuclear weapons. She recalled how 10 years ago she’d organized a week-long teach-in on nuclear weapons. She lamented the fact that not very much progress is being made – nuclear states are not reducing their stocks. The weapons will be smaller and meaner, she said. We’re spending a trillion dollars on nuclear weapons rather than on life, she said, and that’s concerning to her.

Comm/Comm: Half-Crosswalks

Kathy Griswold told the council that in the course of her work to document crosswalks and intersections that do not have adequate sight distance, she’d noticed two crosswalks that are only “half a crosswalk.” One is in front of Casey’s Tavern on Depot Street – on the north side of the street there’s not anything, but on the south side there’s a curbcut. The other location is on Traver at Nixon. She said there’s a curbcut on the south side of the street, but nothing on the north side.

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

Absent: John Hieftje.

Next council meeting: Monday, July 16, 2012 at 7 p.m. in the council chambers at 301 E. Huron. [confirm date]

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