Ann Arbor Gives Initial OK to Pot Licenses

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

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 The moratorium on use of property in the city for medical marijuana businesses – originally enacted on Aug. 5, 2010 to last for 120 days, but subsequently extended – was extended again at Monday’s meeting through June 30, 2011.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

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

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

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

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

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

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

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

Medical Marijuana Licensing

At its March 21 meeting, the council considered a set of licensing requirements for medical marijuana businesses. All new ordinances require an initial approval, plus a final vote by the city council after a formal public hearing. The council had first considered the licensing scheme at its Dec. 6, 2010 meeting. Councilmembers undertook several amendments to the licensing proposal at three of its meetings over the last three months: on Jan. 3, Feb. 7 and March 7.

At its Oct. 18, 2010 meeting, the council gave initial approval to a set of zoning regulations for medical marijuana businesses, but it has not yet given its final approval to those regulations. The council’s strategy is to bring licensing and zoning forward at the same time for a final vote. The context for development of zoning regulations was set at the council’s Aug. 5, 2010 meeting, when councilmembers voted to impose a moratorium on the use of property in the city for medical marijuana dispensaries or cultivation facilities, and directed its planning commission to develop zoning regulations for medical marijuana businesses. Subsequently, the city attorney’s office also began working on a licensing system.

The moratorium on using additional facilities in the city as medical marijuana dispensaries and cultivation facilities – first enacted on Aug. 5, 2010 and subsequently extended – was extended a second time by the council at its Jan. 18 meeting to go through March 31, 2011.

During the course of Monday’s deliberations, mayor John Hieftje elicited from the city attorney’s office an estimate that there are 15 marijuana dispensaries currently operating in the city, plus three dispensaries that are operating in areas that would be prohibited, if the city’s zoning ordinance is given final approval.

Medical Marijuana Licensing: Public Commentary

Gersh Avery reported to the council that a lot of people come to him asking for help – cancer patients who are in stage four, typically. They ask him to make an extract of cannabis that can be used as chemotherapy. In Michigan, there have been 15-20 skin cancer cases cured, he said. He stressed that this is not palliative care, but curative. This kind of cancer research is taking place in other states and other countries, so he wanted to know why it was not taking place in Ann Arbor. A research laboratory to test these materials, he said, needs to be protected, not persecuted. Ann Arbor should be made a center of medical advancement, he said.

Rory Gould told councilmembers he had moved to Ann Arbor from New York 10 years ago, because he wanted to raise his children in a place where they would not be on top of each other, where people are nice to one another, where they’d be exposed to cultural diversity, and have access to high quality education. He thanked the council for their hard work on the ordinance – it’s an example of the spirit of tolerance Ann Arbor is famous for, he said.

Still, he cautioned that there are some remaining concerns. Requiring permanent record-keeping of growers might put good people in danger, he said, and could put a damper on supply. He also expressed concern about the number of dispensary licenses. Most of the existing dispensaries are very well run, he said, but a license might fall into the wrong hands. He said there are some places that are not well run that have no handicapped access and don’t supply locally-grown cannabis. He suggested that licenses also be made transferable on approval of the city council.

Dennis Hayes observed that it’s a now familiar cast of characters who have been speaking and he thanked the council for the work they’ve done. He noted that there are some councilmembers who are spending an extraordinary amount of time to get it right. The Michigan Medical Marijuana Act is helping people get access to high quality medicine, he said. There are still some restrictions, however, that he feels are not helpful to patients. One of those restrictions is that the applications require disclosure of a substantial amount of information about the ownership of the entity – which could be burdensome for dispensaries organized as collectives.

Chuck Ream thanked the council for the opportunity to address them. He said he’d met with Sabra Briere (Ward 1) and the mayor the previous Friday about the issue of documenting the source of the product. He agreed with the intent of the ordinance – we should know where the product comes from in the event of a health emergency. He suggested language that would allow relevant local, county, or state health officials to take action. He suggested that records be kept for 30 days – there’s no reason to keep them for longer than that. He called the need for a cultivation license “pernicious,” because it attempts to restrict the right of people to grow marijuana. About the ordinance requirement that cultivation facilities need a license, he called on the council to “get it out of there,” or everyone who’s currently growing in Ann Arbor will file suit.

Medical Marijuana Licensing: Council Deliberations

The council undertook a series of additional amendments to the ordinance.

Medical Marijuana Licensing – Amendment on Code Section

Sabra Briere (Ward 1) began with an amendment to move the proposed licensing code out of Title VI of the city code, which is designated “Food and Health,” and to move it to Title VII, “Businesses and Trades.” The move entailed a new chapter number – it was proposed that it be changed from Chapter 71 to Chapter 95. The amendment also changed the name of the chapter by striking the word “business.”

At council’s March 7 meeting, Marcia Higgins (Ward 4) had complained to city attorney Stephen Postema that the new chapter was not included in an existing chapter on business licenses – which is also in Title VII. The proposed amendment could be seen as a partial accommodation to Higgins’ concern. The introduction as amended reads:

That a new Chapter 95 be added to Title VII of the Code of the City of Ann Arbor to read as follows:

CHAPTER 95. MEDICAL MARIJUANA LICENSES FOR CULTIVATION FACILITIES AND DISPENSARIES

Postema indicated that he had no problem with the change.

Outcome: The council unanimously approved the amendment changing the code section and title.

Medical Marijuana Licensing – Amendment on License Eligibility

An amendment was proposed to make the ordinance consistent with a different amendment made at the council’s previous meeting – it disqualified people based on a felony conviction only if the felony was for a controlled substance offense. Previously, section 6:415 (2) had disqualified a person based on any felony conviction. As amended, it reads:

6:415. License Required, Number of Licenses Available, Eligibility. …
(2) A cultivation facility or dispensary shall not be eligible for a license if any person required under this chapter to be named on the application has ever been convicted of a felony involving controlled substances as defined under the Michigan public health code, MCL 333.1101, et seq, the federal law, or the law of any other state.

Outcome: The council approved the amendment restricting disqualification just to controlled substance felony convictions, with dissent from Stephen Rapundalo (Ward 2).

Medical Marijuana Licensing – Amendment on Board Activity

An additional amendment to 6:415 added the phrase “taking into consideration recommendations from staff” to the way the licensing board would make its recommendations:

6:415. License Required, Number of Licenses Available, Eligibility.
…
(7) … The Board will annually review and recommend the licensing criteria, the number of licenses authorized, the license fee structure taking into consideration recommendations from staff, …

Outcome: The council unanimously approved the amendment without comment.

Medical Marijuana Licensing – Amendment on Home Occupations

At the request of Sandi Smith (Ward 1), the following amendment was added to allow for the possibility of voluntary registration with the city by home occupation businesses – which the ordinance does not require to be licensed:

6:415. License Required, Number of Licenses Available, Eligibility.
…
(9) Medical marijuana home occupations do not require licenses but may register with the City by providing the address of the home occupation and the registry number on the caregiver registry identification card or that the MDCH issued to the caregiver who is delivering the marijuana, or some other form of identification.

Smith indicated that the idea is to allow the opportunity to have clarity, in the event that someone gave a tip to the police about suspected illegal activity at a location and that there could be a police raid. She wasn’t sure if anyone would take advantage of that opportunity to voluntarily register with the city to avoid the police storming in. She said she didn’t see any harm.

Sabra Briere (Ward 1) suggested that “registry identification card” be supplemented with “some other form of identification.” [The Chronicle understood this to have been accepted as a friendly amendment, but the city clerk's records do not include it as part of the amendment.]

Carsten Hohnke (Ward 5) wondered if this kind of thing was something usually found in an ordinance or rather was simply a service the city is providing. Postema said it wasn’t usual but said it was also appropriate. The police could have their own program based on a council resolution, he said.

Outcome: The council approved the amendment on a roll call vote, with dissent from Stephen Rapundalo (Ward 2) and Stephen Kunselman (Ward 3).

Medical Marijuana Licensing – Amendment on Titling

The next amendment simply made the subsections of 6:417 parallel by giving them each a title:

6:417. Application Requirements for New Annual License or Renewal of Existing License; License Requirements for New License and for Renewed License
(1) Application Acceptance. …
(2) Application Requirements. …
(3) License Requirements. …

Outcome: The council approved the titling of the subsections.

Medical Marijuana Licensing – Amendment on Signage

Originally proposed at the previous council meeting, but inadvertently amended out of the proposed amendment, was language specifying the size of letters on the required signage:

(3) License Requirements. A new license shall not be issued to a dispensary or cultivation facility until the applicant for the license complies with all of the following requirements:
…
(d) The applicant has installed a sign in a location visible to all persons who enter the premises, which contains the following statement in letters that shall be no less than one inch high: …

Tony Derezinski (Ward 2) wanted to strike the hyphen included in the phrase “one-inch” that appeared in the amendment as offered. Postema indicated that it was not a legal issue, and the hypen was dropped.

Outcome: The council approved the requirement on lettering size for the signs.

Medical Marijuana Licensing – Amendment on Labeling, Record Keeping

Sabra Briere (Ward 1) and Sandi Smith (Ward 1) had developed an alternative to the package labeling requirements that was meant to address concerns about record-keeping and the need of a patient to contact someone about the product they were provided. Record-keeping requirements in subsections 6:419 (5) and 6:419 (10) were also eventually added to the discussion and moved as part of the same amendment, with revisions made along the way. As amended and approved by the council, the material read:

6:419. Conduct of Business at Cultivation Facility or Dispensary.
…
(4) All marijuana delivered to a patient shall be packaged and labeled as provided in this chapter. The label shall include:
(a) a unique alphanumeric identifier for the person to whom it is being delivered;
(b) a unique alphanumeric identifier for the cultivation source of the marijuana;
(c) that the package contains marijuana;
(d) the date of delivery, weight, type of marijuana and dollar amount or other consideration being exchanged in the transaction; and,
(e) a certification that all marijuana in any form contained in the package was cultivated, manufactured, and packaged in the state of Michigan.
(f) the warning that:
THIS PRODUCT IS MANUFACTURED WITHOUT ANY REGULATORY OVERSIGHT FOR HEALTH, SAFETY OR EFFICACY. THERE MAY BE HEALTH RISKS ASSOCIATED WITH THE INGESTION OR USE OF THIS PRODUCT. USING THIS PRODUCT MAY CAUSE DROWSINESS. DO NOT DRIVE OR OPERATE HEAVY MACHINERY WHILE USING THIS PRODUCT. KEEP THIS PRODUCT OUT OF REACH OF CHILDREN. THIS PRODUCT MAY NOT BE USED IN ANY WAY THAT DOES NOT COMPLY WITH THE MICHIGAN MEDICAL MARIJUANA ACT OR BY ANY PERSON WHO DOES NOT POSSESS A VALID MEDICAL MARIJUANA PATIENT REGISTRATION CARD.
(g) The name, address, e-mail address, and telephone number of an authorized representative of the dispensary whom a patient can contact with any questions regarding the product.
(h) The name, address, e-mail address, and telephone number of at least one governmental or non-profit organization that may be contacted by a patient who has concerns about substance abuse of drugs, including marijuana.
(5) All of the required labeling information, including coded patient and caregiver information shall be maintained and available for inspection at a cultivation facility or dispensary for no less than 180 days one year after dispensing.
…
(10) A cultivation facility or dispensary shall keep records of the caregivers from whom they receive marijuana in any form, and shall make the records available to the City in a health emergency upon request to promote health, safety and welfare, or to otherwise verify compliance with this chapter.

Stephen Rapundalo (Ward 2) wanted to know what the rationale was for the alphanumeric coding. Smith explained that it would be a way for dispensaries to create a code to allow tracing of product origin without using the codes provided by the state. If it turned out to be necessary to find someone who grew or delivered some particular product, you’d be able to find them.

Briere indicated that they’d learned that the state would not release any information to the city based on Michigan Dept. of Community Health codes unless it’s related to a criminal investigation, so the previous version of the ordinance would not help in the event of a health emergency.

Margie Teall (Ward 4) wanted to know about the requirement that a “certification” be required that the product originated in Michigan. Briere answered by saying that would have to be figured out – it might wind up just being an assertion.

Tony Derezinski (Ward 2) expressed some irritation at the timing of some of the information, saying it had come at the “eleventh hour.” He wanted to hear comments from the city attorney on possible effects on the ability of the police to enforce the law. City attorney Stephen Postema indicated that it’s not new that the state won’t give out information related to registry numbers. The issue, he said, is what kind of record-keeping the council wants dispensaries to have. He didn’t have a problem with the changes. But Postema said that it’s more than just a health issue – the state’s statute intends that there be a close relationship between the patient and the product, he said. He then advocated for enabling the licensing board to look at dispensary records in order to ascertain that the product is grown in Michigan.

Briere noted that even if the city had registry card numbers, the state would not confirm that a number is an authentic registry card number.

Derezinski said he was interested not just in the health issue but also the origin of the product. He wanted to make sure the numbering system would allow for the board to verify that the product was being grown in Michigan. He wanted to know if the board would be able to do spot checks or if the process would be driven by complaints. Postema again advocated for the council to require that records be turned over not just in the event of an emergency, but also to verify that the product originated in Michigan.

Smith suggested adding 6:419 (5) to the amendment on the floor at the time.

Stephen Rapundalo (Ward 2) wanted to know what the rationale was for maintaining the records only 180 days. Smith indicated that just a few hours earlier, there was a draft that indicated 30 days, but she’d be willing to think about an even longer period.

Marcia Higgins (Ward 4) worried about having just a single unique identifier – perhaps there should be some way of cross checking. Smith indicated that patients would know what their own unique identifier is – they could give it to someone else if they wanted that person to pick up their medication for them.

As he scanned down the other sections, Stephen Kunselman (Ward 3) wondered about the idea of site visits – would the licensing board be visiting dispensaries? He said he was leery of having inspections conducted, because it would put city staff in positions they might not want to be in or qualified to handle. He wanted to know what other communities are doing in this regard. Postema indicated that few other communities were trying to enact any ordinances and were instead continuing to “punt,” in some cases by extending moratoria for another two years. Ypsilanti and Ypsilanti Township had developed some legislation, Postema said.

Postema continued by picking up on Smith’s comment about someone picking up another person’s medication for them. There needs to be some additional thought about ensuring that the product goes to a qualified patient, Postema said.

Derezinski indicated he was troubled by questions about when the information on the coding would have to be made available. Briere noted that this was dealt with in subsection (10), and that the council was then discussing just (4) and (5) – would he like (10) to be added to the discussion? Derezinski agreed he wanted it to be added.

At that point, Christopher Taylor (Ward 3) suggested including (10) to the same amendment – which deals explicitly with conditions on which the coded information would need to be made available. Taylor made the suggestion that instead of a medical emergency, more general conditions could result in a request to produce records: “… upon request to promote health, safety and welfare, or to otherwise verify compliance with this chapter.”

Rapundalo indicated his support for the additional language. He asked if the 180 days could be extended to a full year – that was accepted as a friendly amendment.

Carsten Hohnke (Ward 5) wondered how the record-keeping for labeling information – for example, “that the package contains marijuana” – would be handled. Briere explained the logic was that you would just run off two labels, and put one on the package and stick one in a book.

Outcome: The council unanimously approved the labeling and record-keeping amendments as revised during deliberations.

Medical Marijuana Licensing – Amendment on License Renewal

The last amendment introduced was one that dealt with how licenses get renewed.

6:417. Application Requirements for New Annual License or Renewal of Existing License; License Requirements for New License and for Renewed License
…
(8) A license issued under this chapter shall expire one year after the date of issuance. To renew an existing license, the licensee shall submit an application in the same manner as is required to apply for a new license no sooner than ninety (90) days before the expiration date and no later than sixty (60) before the expiration date.

Briere explained that the language had been developed in response to concerns expressed in the community that with an annual license renewal, a dispensary might have to compete with everyone else who wanted a license. She had not been able to come up with language that made clear that existing license holders would not compete for renewal of their license with others who wished to obtain a license for the first time.

Postema said it would not be his expectation that a dispensary with a license would have to compete in that way. Rapundalo noted that it was an important issue, because the city had seen what could happen when an extra liquor license became available a few years ago – it was confusing to determine who might have had a grandfathered-in request. Mayor John Hieftje stressed that the renewal of a license for a dispensary would not be automatic.

Christopher Taylor (Ward 3) felt that appropriate language to afford first-in-line status could be drafted by the time of the second reading of the ordinance.

Final outcome: The council voted unanimously to give initial approval to the marijuana licenses. The second and final votes on its medical marijuana business licensing proposal and its medical marijuana zoning ordinance are scheduled for council’s April 19, 2011 meeting. The moratorium on the use of property in the city as a medical marijuana dispensary or a medical marijuana cultivation facility was extended from March 31, 2011 to June 30, 2011.

[.pdf of medical marijuana licensing ordinance as amended on March 21, 2011]

Medical Marijuana Non-Disclosure Policy

Before the council for consideration was a policy on non-disclosure of certain information, like names and birth dates for patients and caregivers, that might be collected in the course of the zoning and licensing process for medical marijuana businesses. The non-disclosure policy had been discussed, but postponed, at the council’s March 7, 2011 meeting.

The resolution had originally been introduced by Sabra Briere (Ward 1) in the context of the council’s current work on zoning and licensing ordinances for medical marijuana businesses – legislation that has not yet been given final approval by the council. [.pdf of original draft resolution]

Because the medical marijuana licensing ordinance that received initial approval that same evening ultimately did not include the collection of any personal information, Briere – who’d sponsored the resolution – indicated she wished to withdraw it.

Outcome: No council action was taken, as the resolution was withdrawn.

Non-Renewal and Renewal of Liquor Licenses

The council considered two resolutions regarding liquor licenses – one for renewal and one for non-renewal. At its previous meeting, the council had authorized the appointment of Tony Derezinski (Ward 2) as a hearing officer to entertain appeals – a move that was made over the objection of Stephen Rapundalo (Ward 2), Marcia Higgins (Ward 4) and Sabra Briere (Ward 1). The appointment of Derezinski as a single hearing officer had come as an amendment to the original council resolution that night, which had called for the council’s liquor license review committee to serve as a hearing board.

Since appointment as hearing officer, Derezinski has handled two non-renewal recommendations. The city’s intent to pursue non-renewal of a liquor license for Studio Four – located at 314 S. Fourth Ave. – had been based on non-payment of taxes, but they’d since been paid, Derezinski reported at Monday’s meeting. So that license was now being recommended for renewal.

Derezinski’s finding of facts concerning The Fifth Quarter, however, included more than 89 calls for police service at the establishment between Jan. 1, 2010 and Oct. 25, 2010, and reports of fights among patrons, and between Fifth Quarter staff and their patrons. [The club is located at 210 S. Fifth Ave.] The report included one occasion on which 25 officers from Ann Arbor police department, University of Michigan department of public safety, and the Washtenaw sheriff’s office had monitored crowds exiting the establishment and had needed to arrest several people for disorderly conduct.

Outcome: In separate votes, the council voted unanimously to recommend renewal of Studio Four’s liquor license, over dissent from Stephen Rapundalo (Ward 2) and Sabra Briere (Ward 1), and unanimously to recommend non-renewal of The Fifth Quarter’s license.

Applications to MDNRE

Before the council were two items concerning applications to the Michigan Dept. of Natural Resources and Environment (MDNRE) – the city’s own applications, and an application that Washtenaw County is making.

MDNRE City Applications – Skatepark, Canoes, Boats

For two of the MDNRE grants – for improvements to the Gallup livery and park, and for the proposed skatepark at Veteran’s Memorial Park – the city is applying to MDNRE’s Michigan Natural Resources Trust Fund. For the third grant, the city is applying to MDNRE’s Waterway Grant-in-Aid program to upgrade the boat launches at Gallup and Argo parks.

The city’s park advisory commission recommended approval of the applications at its most recent meeting. ["PAC Supports Grants for Skatepark, Gallup"]

MDRNR City Apps – Skatepark, Canoes, Boats: Council Deliberations

An amendment offered by Carsten Hohnke (Ward 5) prioritized the skatepark project over the Gallup renovations – based on the opportunity to leverage $400,000 of matching funds from the county, which will expire unless the skatepark’s construction is under contract by Jan. 1, 2012.

The amendment came after clarification with Sumedh Bahl, the city’s community services area administrator, that just two of the applications are ranked by the city in the application process – those for the skatepark and the Gallup canoe livery. Both are for $300,000 from the Michigan Natural Resources Trust Fund. The other grant, to improve boat launches, is from a different source – the Waterway Grant-in-Aid fund.

In the course of deliberations, Mike Anglin (Ward 5) wanted to know if it were possible to apply to the waterway fund for the canoe liveries – which would eliminate the need to rank the skatepark against any other project. Bahl said it was not possible.

Hohnke’s reasoning was that the skatepark grant could ultimately mean the transfer of a $1 million asset from the Friends of the Skatepark to the city. But if it doesn’t happen this year, the matching grant funding – from the Washtenaw County parks & recreation commission – won’t be available. An application for improvements to the Gallup canoe livery, on the other hand could be applied for next year, reasoned Hohnke.

Tony Derezinski (Ward 2) wanted to know what it would mean to “prioritize” the applications. It’s simply a matter of designating one as the preferred application, explained Bahl. Bahl pointed out that there’s precedent for communities with two applications to have both of them approved.

Christopher Taylor (Ward 3) – who serves as one of two ex officio city council representatives to the city’s park advisory commission (PAC) – noted PAC was very interested at its last meeting in seeing the Gallup canoe livery project go forward. They were anticipating those improvements being useful in the context of the increased canoe traffic that may result from construction of the Argo Dam bypass, which is due to start construction this season. He later stressed that PAC had itself not expressed a priority ranking of Gallup canoe liveries versus skatepark.

Taylor wanted to know if prioritization of the skatepark would significantly reduce the chances of receiving the grant to improve canoe liveries – and if so, what the negative impact would be. Bahl responded by saying that it’s not just a matter of increased boat traffic, but also the safety for pedestrians and the boats. The turnaround for taking canoes from Gallup back up to Argo is logistically challenging. There are also accessibility improvements planned as part of the project.

Taylor drew out the fact that the Gallup canoe livery project is a $750,000 project – the city’s share would be $450,000. Taylor summed up his thinking by saying that a $300,000 grant for the livery would give the city roughly half a project, whereas the $300,000 for the skatepark would mean that they are pretty much “all the way home.” Based on that, he was willing to support prioritization of the skatepark.

Mayor John Hieftje said there’d been an unexpected “bonus” of sales of gas and oil leases into the state trust fund, so it had more money in it now than anyone could remember. He said if the council didn’t accept Hohnke’s amendment, it would essentially leave the prioritization to the state.

Sandi Smith (Ward 1) wanted to know if the canoe livery improvements would be revenue positive – she noted that as far as she understood, the skatepark would not generate revenues. Bahl confirmed that the improvements at the canoe liveries would generate additional revenue – through more boats and more programming.

Stephen Kunselman (Ward 3) indicated he’d be supporting the prioritization, pointing to the chance to leverage funds from the county. He said his understanding was that grant applications that had matching support were generally stronger than other applications. Kunselman noted that a lot of money had already been invested in canoeing recently, whereas there’d been no corresponding support for skateboarders – it was their turn.

Stephen Rapundalo (Ward 2) indicated that he’d support the amendment, but said it would be a hard choice if it came down to it. He said he didn’t want to dismiss the idea that there’s a need for the canoe livery improvements. For him, the county’s match was the crucial point, and he would be willing to cross his fingers that both projects would receive funding.

Outcome on priority amendment: The council voted to approve the prioritization, over dissent from Sandi Smith (Ward 1).

Outcome on approval of applications: The council voted unanimously to approve the three grant applications.

MDNRE: County Application – Land Acquisition

The city council had received a recommendation from Ann Arbor’s greenbelt advisory commission (GAC) to send a letter of support for an application from Washtenaw County to the Michigan Natural Resources Trust Fund. Through its natural areas preservation program, the county hopes to secure funds from the state to help purchase a parcel in Ann Arbor Township now owned by a subsidiary of Domino’s Farms.

At its most recent meeting, GAC had recommended that the city council consider a letter of support, after Carsten Hohnke (Ward 5), the council’s representative to GAC, had cautioned against GAC’s sending such a letter before confirming that the county’s application would not dilute the city’s own chances to win grant funding. [Chronicle coverage: "Greenbelt, County Look to Partner on Farms"]

During brief deliberations, Hohnke mentioned his earlier concern about the possibility that the county’s application could dilute the city’s own chances for its grants. But he had clarified with city staff that the source of the grant money comes from two separate state funds – one for parks improvements and one for land acquisition.

Outcome: The council voted unanimously to approve the letter of support for Washtenaw County’s grant application.

“Transformer Plaza”

Before the council for consideration was authorization of a transfer of $90,000 from its parks memorials and contributions fund to the Ann Arbor Downtown Development Authority.

The money will be used by the DDA for the design and construction management of improvements to a plaza near the Forest Street parking structure. Because of the number of DTE Energy transformers that are situated near the plaza, it’s known in some circles as Transformer Plaza.

The $90,000 figure stems from the $50,000 and $40,000 contributions made to the parks fund by the 601 S. Forest and Zaragon I developments, respectively, which are located in the vicinity of the plaza. As part of any site plan review process in the city of Ann Arbor, developers are asked to make a donation of land so that new residents have access to adequate open space. But the city also accepts cash donations in lieu of land contributions.

Sabra Briere (Ward 1) noted that the residents of the South University area would be pleased – it’d been discussed a lot. Mayor John Hieftje said the project had been in the pipeline a long time.

Outcome: The council voted unanimously to approve the transfer of funds.

Millers Creek

Scott Dierks gave a presentation to the council on the background for the Millers Creek improvement plan, which the council was asked to adopt by resolution later in the meeting. Dierks introduced himself as representing the Huron River Watershed Council, as a member and volunteer. He described Millers Creek as one of six creeksheds in the city, covering about 2.5 square miles in the vicinity of Plymouth and Huron Parkway. The creekshed drains to the Huron River.

He traced the origin of the improvement plan back to 1992 as a grassroots effort by Environmental Research Institute of Michigan (ERIM). ERIM had reached out to the HRWC and to the landscape design firm Peter Pollack & Associates. That eventually led to a Pfizer-funded effort in 2003-04, to develop an improvement plan, which made specific recommendations in light of current and future land use in the creekshed. The plan was approved by the Michigan Dept. of Environmental Quality and the Environmental Protection Agency. The Millers Creek watershed improvement plan is still used as an example of good watershed planning by the EPA, and is accessible through the EPA’s website, Dierks said.

He listed off some specific accomplishments that have grown out of the plan: 56 rain barrels installed; 6 rain gardens installed; 2 detention pond retrofits, including Thurston Pond, which help control stormwater runoff on around 36 acres; planting of oak savannah; and 500 feet of bank stabilization along Huron Parkway.

The resolution before the council, Dierks said, formalizes the work that has already been done and would serve three purposes: (1) acknowledge the plan, which will guide development in the Millers Creek watershed; (2) help designate the watershed as a county drain; and (3) continue to facilitate relationships between creek groups, the University of Michigan, the city, and the neighborhood.

During council deliberations, Stephen Rapundalo (Ward 2) – in whose ward the creekshed is located – complimented those who’d done the long and hard work on the plan. He noted that he’d served on the action team that had worked on the plan in the earlier part of the decade. The city’s planning commission had approved the plan back in 2006, he said. What had been missing was the formal adoption by the city council. He pointed to the designation of Millers Creek as a county drain as a priority when that opportunity presents itself – the designation as a drain would allow it to be eligible for grant funding, he said.

Outcome: The council unanimously adopted the Millers Creek improvement plan.

Sakti3 Development District Hearing Set

The council was asked to vote to set a public hearing on establishing an industrial development district (IDD), which could lead to tax credits for Sakti3.

The company is a University of Michigan spin-off focused on advanced battery technology, headed by Ann Marie Sastry. The IDD would be established for just under an acre of land, located at 1490 Eisenhower Place. Sakti3 is reportedly considering an investment of $2.4 million in new equipment and hopes to hire five additional people.

The hearing will be held at the council’s April 4, 2011 meeting, which starts at 7 p.m. in the city council’s chambers on the second floor of city hall at 100 N. Fifth Ave. [Previous Chronicle coverage mentioning Sakti3: "No Secret Sakti3 Wants Its Batteries in Cars" and "Lutz Rides Current Motors Potential"]

During brief deliberations, Tony Derezinski (Ward 2) said that Sakti3 is an incredible business, saying that it represents the future and is cutting edge.

Outcome: The council voted unanimously to set the hearing on establishing an industrial development district.

City Administrator Hiring Plan

Before the council for consideration was a resolution calling on the mayor to appoint a five-member city council committee, which is to include the mayor, to handle the search process to find a replacement for outgoing city administrator Roger Fraser. Fraser announced his resignation at the council’s Feb. 28, 2011 working session. At the end of April, Fraser will leave the city to become a deputy treasurer for the state of Michigan.

The resolution charged the search committee with providing a recommendation to the council at its April 19 meeting for an interim city administrator. At that meeting, the committee is also expected to present a plan for a selection process to hire a permanent administrator. The plan is to provide for internal as well as external candidates.

Mayor John Hieftje led off council deliberations on the resolution by saying it was gracious of Fraser to stay on through the end of April. He thanked mayor pro tem Marcia Higgins (Ward 4) for putting together the resolution. He said he hoped to finish the hiring process before the end of the summer, if not in mid-summer.

Hieftje announced that the following councilmembers would serve on the committee: Sabra Briere (Ward 1); Christopher Taylor (Ward 3); Marcia Higgins (Ward 4); and Tony Derezinski (Ward 2). Higgins will chair the committee. Hieftje indicated that the committee members had not been chosen by seniority, but rather to get a good mix of experience and perspective. He stressed that the committee would only make recommendations and that the whole council would need to approve all the decisions.

Sandi Smith (Ward 1) asked that when the plan is presented to the council, they get a cost impact analysis for various options for doing the search.

Derezinski described himself as bringing “a lot of baggage” to the committee, having been involved in some searches for the superintendent of schools. He also said he’d been through the process when the Eastern Michigan University board of regents had chosen Bill Shelton as president. He described it as a unique dynamic. The two main functions of the city council are to hire and fire the city manager and to approve the city budget, but it’s not often that the council has the opportunity to do it. [The council also hires and fires the city attorney.]

Derezinski said his bias was to seek expertise from professionals who help with searches, like Colin Baenziger & Associates or the Michigan Municipal League [.pdf of Michigan Municipal League executive search services description]. He said there’d need to be full and robust discussion by the whole council as well as the public. He described it as “a balance” between adhering to the requirements of open government and the interest by some candidates in maintaining confidentiality in the early stages of a search.

Outcome: The council voted unanimously to appoint the search committee.

Schedule Change for Passover

The council considered a resolution to revise its regular meeting schedule for the year by changing its second meeting in April to Tuesday, April 19. The shift was prompted by observation of Passover, the week-long Jewish festival and holy day – its start is celebrated at sundown on Monday, April 18. The council has been holding its meetings recently in the Washtenaw County administration building, due to renovations at city hall. But they are expected to have returned to their chambers on the second floor of city hall for the April 19 meeting, which will begin at 7 p.m.

During deliberations, Marcia Higgins (Ward 4) questioned why they are moving the meeting, given that Passover lasts a whole week. Mayor John Hieftje indicated he had no explanation. City administrator Roger Fraser indicated that it was a suggestion from the city staff, based on previous city council practice. He noted that it would affect the planning commission’s meeting as well. [The planning commission typically meets on Tuesdays, but during the week of Passover its meeting is scheduled for Thursday, April 21.] Hieftje allowed he was not an expert in this area. He said he was interested “only in taking the correcting action here.” Sabra Briere (Ward 1) provided the insight that the first night of Passover is considered especially important.

Outcome: The council voted to change its calendar due to the Passover holiday, with dissent from Marcia Higgins (Ward 4).

Council OKs Property Transfer to Avalon

Before the council for consideration was a resolution to approve the transfer of property at 1500 Pauline from the Washtenaw Affordable Housing Corp. (WAHC) to Avalon Housing. The council also approved the release of WAHC from all terms of their $700,000 federal HOME loan, $300,000 federal CDBG (Community Development Block Grant) loan and Housing Affordability Agreement.

The nonprofit Avalon is currently managing all of WAHC’s properties as part of a consolidation, described as a “merger,” that began two years ago. At its Feb. 22, 2011 meeting the city council approved a site plan for the 1500 Pauline property, allowing Avalon to construct 32 dwelling units and 39 surface parking spaces. The plan includes demolition of four existing apartment buildings – known as the Parkhurst Apartment complex – containing 48 units.

The new construction would include six new buildings totaling 53,185 square feet. Five of the buildings would include one-, two- and three-bedroom apartments and three-bedroom townhomes. The sixth building would be a community center with a playground. The project won a recommendation from the city’s planning commission at that body’s Jan. 20, 2011 meeting.

Outcome: Without comment, the council voted to approve the transfer.

Street Task Force: “Have a Heart, Give Smart”

The council heard a presentation from its street outreach task force, which the council appointed at its Sept. 20, 2010 meeting and charged with developing cost-effective recommendations for addressing the issue of downtown panhandling and the needs of those who panhandle. [Previous Chronicle coverage: "Ann Arbor Task Force Consults Panhandlers"]

The report was given by two members of the task force – Maggie Ladd, executive director of the South University Area Association, and Charles Coleman, a project coordinator with Dawn Farm.

Highlights of the report included recommendations that: (1) the city council revise the city’s ordinance on solicitation to prohibit panhandling in additional locations; (2) the police chief increase police attention downtown during the busiest hours of the week; (3) the city’s community standards division increase their interaction with the public; and (4) the mayor’s downtown marketing task force take an expanded role working with residents, merchants and service providers. The task force report describes an educational campaign to advise downtown visitors and University of Michigan students about options they have besides giving money to panhandlers, a campaign with the slogan “Have a Heart, Give Smart.” [.pdf of street outreach task force report]

During her communications time, Sabra Briere (Ward 1), chair of the task force, told her council colleagues that a revision to the city’s ordinance on solicitation would be presented to them for consideration at their April 4, 2011 meeting.

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: 415 W. Washington Update Scheduled

Mayor John Hieftje noted that last year, the council had approved a three-way collaboration between the city, the Allen Creek Greenway Conservancy, and the Arts Alliance to work on a plan for the future of the city-owned lot at 415 W. Washington. He allowed that a report was owed to the council about progress on that project, and there’d be a half hour presentation at the council’s April 4 meeting. [By way of background, the resolution establishing the collaboration specified: "RESOLVED, That a progress report be delivered to City Council at the first meeting in February, 2011." Chronicle coverage: "City Restarts 415 W. Washington Process" ]

Comm/Comm: Increased Public Accessibility for Meetings

During his communications time, city administrator Roger Fraser mentioned that the city council’s meetings would now be available streamed live over the web: CTN Channel 16 Live. Previously, the city has provided access to archived coverage of public meetings through Community Television Network’s video-on-demand service: Ann Arbor Public Meetings Archive. [CTN also provides live broadcasts of the meeting on its cable TV community access channel.] The accomplishment of the live streaming came relatively quickly after Fraser had first mentioned the possibility at the city council’s Feb. 14, 2011 work session on the budget. From Chronicle coverage of that session [emphasis added]:

Community Television Network

Included in the impact sheets was one for CTN, which Fraser indicated was not part of the general fund, but which is also trying to meet reduction targets. The impact sheet indicates an expenditure for a capital investment of $97,431 – to transition to an appropriate digital format. The new format, said Fraser, would allow for live streaming on computers instead of on television.

Comm/Comm: DDA-City

Christopher Taylor (Ward 3) gave the council an update on progress of discussions between two committees – one from the city council and another from the Ann Arbor Downtown Development Authority – to reach agreement on a new contract under which the DDA would continue to manage the city’s public parking system. The committees have been meeting weekly, he said, and had reached the point of discussing contract language. He said they are making good progress and would be able soon to bring forward a document that could form the basis of a spirited, but fruitful, conversation. [As of the meeting on the morning of March 21, the DDA and the city's committees are still not in agreement on what the percentage of gross parking revenues should be that the DDA pays to the city, or on the specifics about the contract's term. For background on these discussions, see Chronicle coverage: "Parking Money for City Budget Still Unclear"]

Comm/Comm: Labor Report

In January, Stephen Rapundalo (Ward 2), the chair of the council’s labor committee, indicated that he would be using the council communications slot on the agenda to give updates on the status of labor negotiations. Since that time, he has done that on several occasions. On Monday, he announced that he wanted to respond to some statements in an article that had appeared about a week before in a publication called AnnArbor.com.

Rapundalo said he’d already conveyed his responses to the author of that article, but that he would not be commenting on the author’s “vivid prose,” which described Rapundalo’s reaction to a report that he’d been looking at. [From the article's opening line: "It's early on a Friday morning and Ann Arbor City Council Member Stephen Rapundalo is shaking his head, a look of distaste frozen in his eyes."]

Rapundalo began by addressing the reporting of some background material provided in the article, which Rapundalo said portrayed some confusion with respect to the purpose of the state’s Act 312 statute.

Rapundalo stressed that Act 312 had not taken away the right to strike by police and fire personnel provided in exchange for compulsory arbitration. [From the AnnArbor.com article: "When it was put in place in 1969, it was seen as a solution to a problem: By sending disputing parties to arbitration, cities could avoid public safety strikes, and police and fire personnel would be guaranteed an arbitrator would consider their requests."] Instead, Rapundalo pointed out, the Public Employment Relations Act 336 of 1947 already prohibited strikes by public sector employees. He quoted the act: “A public employee shall not strike.”

Later, in 1969, the legislature passed Act 312, which Rapundalo then quoted to show again that the right to strike was already prohibited when Act 312 was passed: “It is the public policy of this state that in public police and fire departments, where the right of employees to strike is by law prohibited, …”

Rapundalo also took issue with any implication from statements reported in the article that the city had not bargained in good faith in prior negotiations. Rapundalo said the city had based its negotiations on the economics of that time, noting that economic conditions had changed, even in a very short time period. Today’s economic reality is different, he said, and the city is now negotiating based on current conditions.

Rapundalo then took issue with statements attributed to a representative of the Ann Arbor Police Officers Association (AAPOA) about reduction in health care benefits. Rapundalo stressed that the city had not asked and was not asking for reductions in health care benefits. Health coverage is not the issue, he stressed, but rather employee contributions to their own health coverage and retirement.

Rapundalo took issue with the statement by AAPOA reported in the article that expressed a willingness of the union to continue their 2009 contract, without any wage increases. If the union thinks that forgoing a wage increase is a fair sacrifice, Rapundalo contended, then they really haven’t been paying attention to what’s been going on around the rest of the state and the country. Other unions have given up longevity bonuses, uniform allowances and retirement plan contribution matches, he said. The “step increases” based on years of service that are a part of the current police contract, together with other features of the contract, will result in a 3.5% increase in costs in FY 2012 compared to the current fiscal year, Rapundalo said – when other groups’ costs are going down.

Rapundalo also disputed a claim by AAPOA that exposure to radon in the city hall building resulted in greater need for health care by its members, and that their health care plans should be left in place. Rapundalo stated that there’d been no demonstrable link between conditions in the building where they’d been previously housed and any increased need for health care. If there were such a link, Rapundalo concluded, it would be covered under a worker’s compensation claim, not under the city’s health care plan.

Comm/Comm: Digital Cities Award

Robert Blake, regional vice president for government and education at AT&T, presented Dan Rainey, the city of Ann Arbor’s IT director, with the 6th place Digital Cities Award for cities in its category for the survey – those with populations from 75,000-124,999.

The top cities for that category – in order of ranking, including ties – were: Pueblo, Colo.; Olathe, Kan.; Lee’s Summit, Mo.; Roseville, Calif.; High Point, N.C.; Independence, Mo.; Simi Valley, Calif.; Ann Arbor, Mich.; West Palm Beach, Fla.; Arvada, Colo.; Roanoke, Va.; Schaumburg, Ill.; and Berkeley, Calif.

Blake noted that it was the third year in a row that Ann Arbor had been included in the top ten. This year the ranking was especially meaningful, he said, because it was based on a new scoring system that is based on actual results. Among the specific initiatives cited by Blake were: a shared data center with Washtenaw County and adoption of cloud technology; use of in-car digital video in police cars; online water consumption data for consumers; and the city’s use of Facebook and Twitter.

Comm/Comm: Police Incident

Mike Anglin (Ward 5) related how a resident of his ward had called in a report to the police about something and had wound up being cited for a violation, which had caused the person to become very upset. Anglin described how the situation had resolved itself with an apology from the police, and concluded that in this town, you can fight city hall. Anglin portrayed the episode as reflecting positively on the police department.

Comm/Comm: Palestine

Henry Herskovitz addressed the council with two items he said he thinks will help promote peace in Palestine: (1) passing a human rights resolution for the cessation of military aid to Israel; and (2) his group’s forum to be held on March 29 at 7 p.m. at the Mallets Creek branch of the Ann Arbor District Library. He told the council that they might think it was risky to challenge the local Jewish community, but he gave them an example of a food co-op in Olympia, Wash. that had passed a boycott of Israeli goods, and had become stronger as a result of it.

Herskovitz told the council that he’d joined the Olympia food co-op and and showed them a picture of himself standing in front of the co-op. He told councilmembers that standing for social justice can, in fact, have an impact. He quoted Rosie the Riveter from World War II: “We can do it!” He asked council members to “shed past acrimonies” and to attend the Mallets Creek forum on March 29.

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

Next council meeting: Monday, April 4, 2011 at 7 p.m. in the city council chambers on the second floor of city hall at 100 N. Fifth Ave. [confirm date]