Heritage Row, Sidewalk Tax Intent in Limbo

Ann Arbor city council meeting (Oct. 3, 2011): In spite of the eight public hearings scheduled for Monday night, the council’s agenda was actually relatively light. Six of the public hearings were very similar requests for annexations of property from Scio Township into the city of Ann Arbor. The annexations were all approved with scant comment from the public or the council.

But two agenda items – both related to the future of the block of South Fifth Avenue just south of William – resulted in over an hour of deliberations by the council.

An item added late Monday afternoon gave a glimmer of hope to the Heritage Row planned unit development (PUD), which the council last had on its agenda on Dec. 6, 2010 – nearly a year ago. On Monday, the council voted to suspend its rules, then voted to reconsider the project, and finally voted to postpone it until its Oct. 17 meeting.

By Oct. 17, a set of changes proposed by the development team are to be incorporated into the site plan and zoning regulations for Heritage Row. The developer says the changes to Heritage Row would be necessary, in order for him to diverge from his current intention to build City Place, an already approved “matter of right” project at the same location. Those changes include eliminating any on-site parking requirement, increasing the number of residents, relaxing the energy standards, and not making a commitment to the historical preservation of the existing seven houses on the site. [.pdf of letter from developer]

If the council were to give the new version of Heritage Row initial approval at its Oct. 17 meeting, it would then take a second and final vote on it at a meeting now scheduled for Oct. 24.

In a related action, the council approved a revision to the development agreement for City Place that eliminated the need for the developer to complete off-site utility work before being issued a building permit for that project. Now, that utility work would need to be completed later in the process, before the certificate of occupancy is issued. The relaxation of the timeline was undertaken to allow the developer additional flexibility to discuss a modified Heritage Row, as an alternative to City Place.

In other business, the council again delayed action on a resolution of intent for the use of revenue generated by a proposed street and sidewalk repair millage that voters will be asked to approve at the Nov. 8 election. Questions concerned the need for such a resolution at all, as well as the plan for use of the millage inside the Ann Arbor Downtown Development Authority district.

A request for rezoning a medical marijuana business on South State Street was denied by the council, but did achieve three votes on the 11-member body.

The council also approved an easement for DTE to replace a gas main along the north side of Fuller Road.

Heritage Row

Added to the agenda late Monday afternoon was a bundle of resolutions that in concert put the Heritage Row planned unit development (PUD) for South Fifth Avenue back before the council for formal consideration and possible future approval. Approval of the project is contingent on the council’s judgement that the project meets the standard of public benefit required in order to replace the land’s existing zoning with the alternate zoning requested for it.

Heritage Row, as it had been previously designed, consisted of preserving seven existing houses and constructing three apartment buildings behind them, with underground parking.

A different project for the same site, City Place, has already won council approval. That approval was based on the planning staff and city attorney’s judgement that the project met all existing zoning codes and regulations, and could be approved as a matter-of-right project. City Place would require demoliting the existing seven houses, to be replaced with two apartment buildings separated by a parking lot.

City Place is seen by most observers as an inferior project to Heritage Row, and the prospect that City Place will actually be built – based on recent pre-construction meetings and the termination of leases for tenants in existing properties – has prompted the council to take up the issue again.

Heritage Row: Parliamentary Issues

In broad strokes, there were three parliamentary steps for the Heritage Row agenda item, each corresponding to a separate vote.

First, the council needed to suspend two parts of a council rule on reconsideration of previous votes. The council had previously reconsidered the project over a year ago – on July 6, 2010, when the council rejected Heritage Row on a 7-3 vote. The council had initially rejected the project at its June 21, 2010 meeting on a 7-4 vote. The project needed an eight vote super-majority to pass, because sufficient signatures were collected from nearby property owners to force the eight-vote majority.

So some parts of Rule 12 needed to be suspended. It reads [relevant parts in italics]:

RULE 12 – Consideration of Questions
When a question has been taken, it shall be in order for any member voting with the prevailing side to move a reconsideration thereof at the same or the next regular meeting; but, no question shall a second time be reconsidered.

The parliamentary motion to suspend the rules is not subject to debate. This is a point that Carsten Hohnke (Ward 5) made on Dec. 6, 2010, when the council had a similar set of motions on its agenda concerning Heritage Row. Citing the parliamentary rule, Hohnke successfully quashed all debate on the issue that evening. At Monday’s Oct. 3 meeting, Hohnke did not choose to invoke this rule, and councilmembers debated the suspension of council rules for an extended period.

Because Hohnke had previously voted with the prevailing side – along with Mike Anglin (Ward 5), Sabra Briere (Ward 1) and Stephen Kunselman (Ward 3) – he could then make the motion to reconsider Heritage Row.

The second step of the Oct. 3 process was a vote on whether to reconsider the Heritage Row project.

The third step of the Oct. 3 process was a vote on the project itself, which was presented to the council as an action to postpone a decision until the council’s next regular meeting, on Oct. 17. Part of the motion to postpone included a direction to city staff to incorporate the content of a set of developer-proposed changes into the site plan and zoning for Heritage Row, so that on Oct. 17 those changes would be presented to the council for their initial consideration.

The third step also included a motion to add a “regular meeting” to the council’s calendar for Oct. 24, so that the council could give the project a second and final approval, assuming that it received initial approval at the Oct. 17 meeting. All ordinance changes require two readings by the council. [A PUD project is an ordinance change, because it changes the zoning of a parcel.] The first regular council meeting in November falls on Nov. 10 (due to the Nov. 8 election) and that was deemed by the developer to be too late.

During deliberations, Marcia Higgins (Ward 4) questioned whether the revision to the calendar to add an extra meeting constituted the addition of a “regular meeting,” or was rather the addition of a “special meeting.” Assistant city attorney Kevin McDonald noted that it had to be a “regular meeting” due to the charter requirement that a second reading of an ordinance cannot come before the next “regular meeting” of the council, after the initial reading. From the city charter [emphasis added]:

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

If the Oct. 24 meeting were labeled a “special meeting,” then the council could not take the second vote on the Heritage Row project at that meeting, because that would be earlier than Nov. 10, the next regular council meeting.

The city charter also stipulates that the council must determine its regular meeting times:

SECTION 4.4.
(a) The Council shall fix the time and place of its regular meetings and shall hold at least two regular meetings in each month. If any day prescribed for a regular meeting of the Council is a holiday, such regular meeting shall be held at the same time and place on the next secular day, except that when such holiday is an election day, the meeting shall be held on the following Thursday.

At the Oct. 3 meeting, defending the labeling of the additional Oct. 24 meeting as a “regular meeting,” mayor John Hieftje observed that the charter allows for more than two “regular meetings” in a month.

However, the mechanism the council uses to fix the time of its “regular meetings” is the set of council rules, which it ratifies after installation of new councilmembers each year. In Rule 1, the principle for scheduling of regular meetings, is laid out:

RULE 1 – Time of Council Meetings
Regular meetings of the Ann Arbor City Council shall be held on the first and third Monday of the month at 7:00 p.m., in the Council Chamber at City Hall.

During a recess in the Oct. 3 meeting, after the Heritage Row votes were taken, including the motion to modify the council’s calendar by adding a single “regular meeting,” The Chronicle pointed out to Higgins that the council’s vote to establish a “regular meeting” on Oct. 24 had flouted Rule 1. When the council resumed its meeting, Higgins made a motion to suspend Rule 1, and to re-establish the modification of the calendar to add a “regular meeting” on Oct. 24.

Outcome: Later in the meeting, after a recess, the council unanimously approved the suspension of Rule 1 and the addition of a “regular meeting” to the calendar for Oct. 24.

Heritage Row: Substance of the Letter

Around 4 p.m. on Oct. 3, councilmembers received a letter written by Jeff Helminski representing City Place Ann Arbor LLC, the owner of the City Place project. The letter outlined the expectations for modifying the Heritage Row project that would be necessary for the project’s new ownership group to consider building Heritage Row instead of City Place.

Helminski writes: “The investment perspective of the new ownership group and development team is that the formerly proposed Heritage Row project is not economically viable or financeable.” [.pdf of letter from developer] [.pdf of revisions to supplemental regulations for PUD]

The main points of the letter that likely pose the greatest hurdle include a relaxation of the commitment to historic preservation of the existing houses, a relaxation of the energy-conservation features, an increase to the number of residents, and the elimination of any on-site parking requirement.

Heritage Row: Why Hohnke?

Carsten Hohnke (Ward 5) sponsored the agenda item related to the Heritage Row project. His has been considered the key vote on the project, which needs an eight-vote majority because of a successful petition by nearby property owners to force the super-majority requirement.

The other three councilmembers on the 11-member council who voted against the project have not indicated any hint that they might be inclined to support it now.

On July 6, 2010, when the council reconsidered the project for the first time, later in that same meeting Hohnke first attempted to get his council colleagues to reconsider establishing a historic district in the area. When that failed, he made a motion to suspend the council rules to reconsider the Heritage Row project, apparently finally ready to change his vote. However, the mayor called a recess to the meeting, and during the break Hohnke apparently changed his mind. When that meeting resumed, Hohnke withdrew his motion.

Heritage Row: Council Deliberations – Administrative Envelope

On Oct. 3, Hohnke led off deliberations on the Heritage Row item. He referred to the complexity of the consideration and the multiple timelines as accounting for the late addition to the agenda. He said the council had anticipated a different process for this project. As a council, they had voted to waive part of the fee for resubmitting the project. [The council made that decision at its Feb. 7, 2011 meeting.]

However, Hohnke said, that initial development team discovered that the Heritage Row project was not financially viable. The new development team is moving forward with the City Place project instead, he said. Hohnke characterized the new team as very gracious about discussing the Heritage Row project. Hohnke allowed that he had not had a chance to speak with all of the neighbors on the block, but that those he’d spoken to have been very constructive. And those who have been closely involved have indicated support, he said.

What he intended to accomplish, Hohnke said, was to create the opportunity to continue conversations about how to modify the Heritage Row project so that it’s financially viable to the developer and continues to provide the beneficial effects to the city as required by a PUD. He alluded to the letter from the development team, and noted that there’s “a lot of devil in the detail” of the letter. The shortest way to communicate the content of the letter, Hohnke said, is that the goal is for the developer to come back with a version of the plan that is “inside the administrative amendment envelope to the existing site plan.” That is, he said, there would be adjustments of the type that could have been approved administratively for the site plan currently on file with the city.

By way of background, Chapter 57 of the city code defines specifically the type of administrative amendments allowable to a PUD site plan [emphasis added]:

Administrative Amendments to Approved PUD Site Plans. A minor change to an approved PUD site plan may be approved as provided in this Chapter for Administrative Amendments to Approved Site Plans, except that the proposed changes shall not alter the fundamental design, conceptual integrity, natural features shown to be preserved, any specific conditions of the PUD development program, the conceptual PUD plan or the supplemental regulations. The following restrictions shall also apply: Adjustment in approved phase lines shall not result in a change greater than 10% of the total gross land area in any phase, or 10% of the number of approved lots, or 10% of the approved maximum building square footage. Any decrease in building size or changes in bedroom counts per dwelling unit shall not reduce the size or number of affordable housing units approved as part of the PUD site plan.

Given the nature of the explicit changes to the supplemental regulations corresponding to the stipulations in Helminski’s letter, Hohnke’s description of a revised proposal that would fall within the envelope of administrative amendments appears questionable.

In a followup phone interview with The Chronicle, city of Ann Arbor planning manager Wendy Rampson offered some clarity about the goal of the conversation between the staff and developer. The proposal to be worked out for the Oct. 17 first reading wouldn’t fit within the envelope of “administrative amendment” to the site plan currently on file with the city, Rampson said. Instead, the goal was to alter the site plan and PUD zoning in a way that, if approved by the council on second reading, any additional changes needed by the developer could be made administratively, Rampson said.

Hohnke concluded by saying that the point of suspending the council rules was for the sole purpose of reconsidering Heritage Row. He stressed that the action that night would not be “determinative” of the kind of project that would result. He urged his colleagues’ support of the motion to suspend the rules.

Heritage Row: Council Deliberations – What Are We Approving?

Sabra Briere (Ward 1) asked Hohnke to explain why he was asking the council to suspend the rules now, some 14 months after the initial vote on the project, and why the developer is not going through a standard PUD process.

Hohnke said there are significant timeline constraints. There are significant financial constraints that the development team is under. Backing up the time of having rent-paying tenants in a new development, Hohnke said, you have a situation where there is not time to have a full process of submitting a new proposal with new supplemental regulations and a new site plan, and going through staff review and the planning commission. The timeline for a full process, he said, is not an option for the development team. The alternative of City Place would be pursued if the full-process option were the only option for Heritage Row. But the council has the opportunity to reconsider a previously submitted site plan, he said.

The flip side to that shortened process is that the development team is then constrained by the existing site plan, Hohnke said. The need to reconsider the existing site plan, he said, is driven by the timelines that drive the financial ability to finance the alternative project.

Sandi Smith (Ward 1) ventured that basically it’s because the developer has given tenants notice – that’s what is driving the timeline. The developer could leave tenants in place and go through the process from square one, she said. Hohnke stated that was not the case. He said that when the carrying costs are factored in – something like $14 million – keeping the current tenants in place would cover some, but not enough of the costs to keep the tenants in place and move ahead with a full process. Eliminating the financing carrying costs becomes the critical factor, Hohnke concluded.

Marcia Higgins (Ward 4) said in looking at the reconsideration, there are attachments to the resolution. [.pdf of letter from developer] [.pdf of revisions to supplemental regulations for PUD] She wanted to know if the council would be approving the attachments – because their content gave her great pause, she said.

Kevin McDonald of the city attorney’s office reviewed for Higgins the set of parliamentary motions described in one of the attachments. [.pdf of parliamentary motions] The first motion was the suspension of rules. The second motion was about the question of the reconsideration. The third motion was to explain the resulting timeline. McDonald noted that one of the attachments is a developer’s letter of requested changes that the city received at 4 p.m. on Monday, which was forwarded to the council.

McDonald stressed that those changes were the developer’s requested changes. McDonald said the city attorney’s office has not had time to review the material. He noted that the third parliamentary motion gave direction to staff to work on incorporating those requests so that council could have a first reading with revised supplemental regulations. The council was not being asked for an approval specifically, he said.

Higgins noted that under the scenario councilmembers were weighing, the council would reconsider the project, then postpone it, giving specific direction to revise the project. She noted the council would be giving direction that staff should spend time on making changes – but she did not agree with many of the changes. The original elements of the project with great public value are being significantly changed, she said. It would be one thing if the direction was being given based on the council’s view of what should happen, she said, but that it appeared that the direction was being given to make modifications based on what the developer wanted.

McDonald acknowledged that the changes were proposed by the developer and had not been reviewed by staff – Higgins was correct. Unless the council provided some other direction, staff would try to check to see if the developer-proposed changes met the PUD standards and would seek to incorporate them as best they could.

Heritage Row: Council Deliberations – Are These Actual Demands?

Hohnke stressed that there is nothing about the letter and the third motion that is constraining. The motion simply directs staff to work with the development team, the council and the community on a “slightly modified PUD.” Hohnke thought it would be helpful to the council for the developer to lay out exactly what he’s suggesting. Because of the accelerated timeline, Hohnke said, it’s not exactly clear to the developer how they need to modify the project to provide financial viability.

Hohnke ventured that the developer is asking for the “maximum envelope.” Hohnke said he would hope that the version the council would see at first reading on Oct. 17 would be “much tighter” on the requirements for renovating the existing houses, height, floor-area-ratio (FAR) and open space requirements. It provides the opportunity to get input to make the project as beneficial as possible, he said.

Hohnke thought the eventual proposal would be different from the outline in the letter – it would be “more beneficial” to the community. At the first reading and at the second reading, the council would have the opportunity to provide additional input. Higgins clarified with McDonald that it would come before the council on Oct. 17, and that it comes back to second reading the very next week on Oct. 24 – at a meeting created through modifying the council’s calendar. Hohnke clarified that given the way weekdays fall this year (with the first day of November falling on a Tuesday), the first regular meeting of the council falls as late as it can possibly come in the month – on Thursday Nov. 10, after the Nov. 8 election. That would be too late for the developer’s timeline, Hohnke said.

With respect to the timeline, McDonald weighed in, saying that the statutory requirement of a 15-day notice before the public hearing on Oct. 24 meant that the public hearing would need to be noticed to the public before the first reading on Oct. 17.

Responding to Hohnke’s mention of opportunities to modify the proposal further at the first and second readings, McDonald advised councilmembers that it was really the occasion of the first reading when they should be considering any possible revisions to the proposal, not the second reading. Material changes made at the second reading would result in an additional reading required before the council, McDonald said.

Higgins lamented the fact that it means it won’t be until the night of the final decision that the council would have the opportunity to hear from the public, and it’s been a very hot topic with the public, she said.

Heritage Row: Council Deliberations – Public Benefit

Stephen Kunselman (Ward 3) noted the majority of the public benefit had been removed. [The PUD ordinance stipulates that a public benefit must be provided by a project in order to justify the non-conformance to zoning.] Nothing requires historic preservation of the homes. The developer is cutting back on the affordable housing component. So the question, Kunselman said, is whether the project is a PUD or not. Obviously, he said, Heritage Row did not meet the financial requirements of the developer, because there was too much public benefit and it was costing too much money.

If they’re stripping that out, Kunselman said, maybe the developer needs to do a different project that the developer can afford. What’s wrong with townhomes? he wondered. It’s “mind boggling” Kunselman said, looking at it as someone who had not seen the project from the very beginning. [Kunselman was referring to the fact that a City Place PUD had originally been rejected by the council in January 2009, just after Kunselman left the council, following his defeat in the 2008 Democratic primary by Christopher Taylor. Kunselman won back a seat the following year.]

Sandi Smith (Ward 1) reminded Kunselman that he’d been at the table for the initial Heritage Row vote in the summer of 2010. But she said she had similar concerns as Kunselman. At first glance, she said, it looked like the developer was reducing the public benefit. It wasn’t palatable in the summer of 2010 to some councilmembers, she said, so she was not sure why it would be palatable now, given the reduction in public benefit. She said she was not saying that she wouldn’t continue to support the project – she’d voted for it back in 2010. She found it “kind of awkward” that there is a “bulldozer here and a developer here” and the council is moving towards a weaker set of public benefits than they had the first time around.

Smith said if the preservation of the properties is a public benefit, then she hoped that would be negotiated – at least the facades and as much of the structures as possible. To accept less in public benefit, it would be difficult to agree. She said she’d support it going forward, but she wanted to send the message to be tough in the negotiations.

Hohnke said he agreed with Smith. He felt the historic preservation element of the project was very important. The council had an option for thorough historic preservation, Hohnke reminded his colleagues, which the majority of the council decided not to pursue – despite the unanimous recommendation of the unanimously-appointed historic district study committee to establish an historic district in that area. Whatever way the council had gotten to its current position, he said he didn’t see the value in evaluating past arguments and instead wanted to find a path forward that makes the most sense. If someone wanted to reconsider establishing a historic district, he would be willing to entertain that.

Tony Derezinski (Ward 2) said he couldn’t help but think of the phrase: “It’s deja vu all over again.” He ventured that some deathbed conversions are valid and this is one where the council should see what can be done at the last minute to preserve a better project. Derezinski said he’d been supporting the project consistently, because the design was creative and functional, and the public got a lot of benefit out of it. He said Smith is right – as currently described, there’s less public benefit. Giving it a shot would be worth it, he said, so he’d vote for the reconsideration.

Christopher Taylor (Ward 3) said he saw very little utility in reviewing past postions. In his view, it was a reasonable and forward-looking proposal to pursue conversations, and it was to the larger good of Ann Arbor that the council do so. Margie Teall (Ward 4) said she was very reluctant to see the public benefit scaled down. Mayor John Hieftje said he would join others in being cautious. He ventured that the whole development saga on the block will show up in a planning textbook and it would probably “not reflect brightly on us.” But he said he would support Hohnke’s efforts to pull it out of the fire in the end.

Hohnke stressed that there is a long way to go and said that the probability of success is “well, let’s just say not 100%.” But Hohnke said the thinking was to stay on the ballfield until the last out.

Sabra Briere (Ward 1) said she would vote for the reconsideration on the understanding that the council has not seen the development agreement. She echoed Smith’s thoughts in saying she hoped the council sees something better by the time it comes back. The race is to the swift, Briere said, but it’s also to the most accurate.

Mike Anglin (Ward 5) said everyone had worked hard for the last four years on this project. He was willing to give it another look. He said that with a change of ownership, a new game has started, and the council has to see who it’s dealing with now. That could lead to surprises in either direction.

Stephen Rapundalo (Ward 2) said that he, too, would support the project but like others, he remained somewhat skeptical. It’s going to take a Herculean effort to get to some semblence of a modified project, he felt. However, he was willing to give it one last shot. He’d supported it from the very beginning.

Outcome on suspension of council rules: The council voted unanimously to suspend council rules in order to vote on the matter of reconsideration.

Outcome on reconsideration: The council voted unanimously to reconsider the Heritage Row project.

Heritage Row: Council Deliberations – Incorporating the Letter

Before voting on the postponement and the direction given to staff, and the setting of the additional council meeting on Oct. 24, Higgins ventured that the additional meeting would be a “special meeting” not a “regular meeting.” McDonald said the charter required “at least” two regular meetings each month, but that having a third meeting would not make it a special meeting. It needed to be called a “regular meeting” because otherwise the soonest regular meeting after Oct. 17 would be Nov. 10.

Smith asked for clarification on the final paragraph of the motion:

I move that City Council direct the Planning and Development Services Unit and City Attorney’s Office to incorporate the developer’s proposal into the PUD Zoning and Site Plan, and review all required revised plans, regulations and agreements submitted by the developer, prior to Council consideration.

From that Smith concluded that the attachment was to be incorporated. McDonald said that Smith was correct, but that staff had heard some concerns from the council about public benefit and that it would be appropriate for the council to modify that language – if the council wanted to alter the wording, the council could provide specific direction to staff.

Hohnke did not agree with McDonald’s interpretation. Incorporating the developer’s proposal into the PUD site plan does not reference any particular attachment or set of proposals, Hohnke contended. It just asks staff and the developer to work on this project. The developer’s proposal might be modified from the developer’s letter by the time it reaches its first reading on Oct. 17. He asked McDonald to confirm that there’s nothing in the language to require that the “maximum envelope” expressed in Helminski’s letter be incorporated into the PUD zoning and site plan.

McDonald reiterated what he’d already said: If the council wants the staff to negotiate something, it would be helpful to add specific direction in the motion. McDonald indicated that they’d already heard in the discussion that councilmembers had concerns.

Hieftje said he read Helminski’s letter as saying: We’re going to build City Place, but we may change our mind if we can change Heritage Row so that it’s financially viable for us. He said it’d be a mistake not to put those the elements from the letter into the PUD zoning and site plan. Then if councilmembers wants to say no to it, they can do that. Hieftje said he appreciated the straightforwardness of Helminski’s letter.

Higgins said she understood the developer’s starting point, but still felt there needs to be an accounting for what city staff is to do. If there’s no agreement by Oct. 17, then there may be nothing that comes forward anyway.

Kunselman noted that the already-approved motion had put Heritage Row back on the table. He wanted to know if the council could vote for Heritage Row as it was without any of the amendments, but with all of the public benefit in the project, and just vote it up without amendment? McDonald said he didn’t think that would be appropriate. The owner has not asked for reconsideration except together with some changes pursuant to Helminski’s letter. The developer is not asking for reconsideration of the original proposal, and has stated that the original project is not financially viable, McDonald said.

Taylor felt there was a lot of conversation about what it means for it to be the “developer’s proposal” and for his reading, he did not believe the letter constitutes an “in stone” set of deal points that the developer was proposing. The letter is certainly forceful, Taylor said, and articulates a number of business points that the developer wants to achieve. The current resolution, he said, is appropriate. At the point the council receives a proposal in the form of a revised site plan, that would be the appropriate time to consider the public benefit associated with the proposal.

The development team knows what the council is saying, Taylor said. He thought it made a great deal of sense to go forward along the path indicated in the resolution. When the times comes, the council will make the judgement as to whether the public benefit is great enough.

Teall said that in addition to the letter, she was also looking at the supplemental regulations draft. That seemed pretty specific, she said, and she thought it was pretty clear what the developer was saying. She felt like it could easily be an “exercise in futility.” The developer had laid it out very clearly. She said she would not count on a lot of changes from what was indicated.

Rapundalo agreed with Taylor and felt it was a set of parameters or conditions. It’s “the box we’re going to work within.” The developer would come back with a final version and the council could then take it or leave it on its merits, he said. The developer just wanted to let the council know what the key elements were for the developer. He had no problem giving the developer time to work with the staff.

Heritage Row: Council Deliberations – Making Direction Explicit

Derezinski said he felt there was potential ambiguity in the last paragraph. He proposed an amendment to the resolution that gave it the following form [additional material in italics]:

I move that City Council direct the Planning and Development Services Unit and City Attorney’s Office to incorporate the developer’s letter proposal into the previously proposed PUD Zoning and Site Plan, and review all required revised plans, regulations and agreements submitted by the developer, in accordance with the requirements of the PUD ordinance, including making suggested changes, prior to Council consideration.

Taylor said that a number of councilmembers had indicated their dissatisfaction with a number of points articulated in the developer’s letter. In the amendment, the council would be instructing staff to incorporate the letter into the site plan amendments, without regard to whether the developer might choose to rethink the requirements.

Taylor said he wouldn’t support the amendment because of the injection of the mention of the letter. The goal is to receive the developer’s last, best offer. Let’s wait and see what the developer brings to the staff – if it’s exactly what’s in the letter, councilmembers can vote on it as they will, Taylor said.

Briere confirmed with Hohnke that the letter and revised supplemental regulations had just arrived late that afternoon and McDonald had indicated he had not yet reviewed it. To her, she said, that indicated it was put together “in a hurry.” Hohnke replied to Briere by saying that “overnight is a generous description.”

Hohnke then said he felt the council was “over-thinking it.” City staff had asked the developer to provide the letter and revised supplemental regulations merely to provide the council with an understanding of the “maximum envelope” the developer is considering. It was not intended to lay out clearly specifically what they’re driving at. It was meant to “set some stakes in the ground.”

Briere replied that if the letter is just concepts, then the council was not actually seeing the developer’s proposal that night. She wondered if the council would see the proposal before the evening of Oct. 17. Hohnke said it would come sooner than that, because it would be an agenda item and would be distributed on Wednesday afternoon [Oct. 12] before the council meeting. There would be plenty of time to review it. If that was the case, Briere ventured, the council should be content to wait.

Higgins said two paragraphs in the letter were of concern to her:

I encourage you to take the necessary actions to allow our team and the City to continue a productive dialog in pursuit of the creative solutions necessary to devise an alternative development plan that meets the requirements of all involved.

Following is a summary of the revisions to the former Heritage Row supplemental regulations necessary to facilitate a change of direction from City Place to an alternative plan

Higgins said that read to her as exactly the things the developer needed to have in order to diverge from constructing City Place. That’s saying to her these are things they need to have. Maybe that’s a starting point, but the council will have to see if that meets the PUD ordinance. Then the council could see if there is a way to meet in the middle. She supported the amendment.

Kunselman suggested taking the course of striking all reference to the developer. Then the staff and the developer can work through whatever they want. At Hieftje’s request, McDonald offered that the council’s conversation had made clear what their concerns were and the council’s position with regard to Helminski’s letter. McDonald said he did not think that Derezinski’s amendment would require staff to follow Helminski’s letter. The amendment added some clarity that the staff needed to respond to the appropriateness of the proposal with regard to the PUD ordinance, McDonald said.

Higgins said she appreciated hearing from the city attorney’s office, but she also needed to hear it from the city administrator, because he would be handling it. “Do you have clear direction to move forward and have this dialogue?” she asked city administrator Steve Powers. His one-word reply: “Yes.”

Hieftje said he wouldn’t support the amendment, saying the way the resolution had come to the council was fairly simple, cut-and-dried.

Outcome on Derezinski’s amendment: The council approved the amendment on a 6-5 vote. Voting for it were Anglin, Smith, Derezinski, Kunselman, Teall and Higgins. Voting against it were Hieftje, Briere, Rapundalo, Taylor and Hohnke.

Some confusion ensued when the mayor misheard the report from the clerk that the amendment had been approved.

Outcome on the main motion: The council voted to postpone consideration of Heritage Row until Oct. 17.

City Place Construction Sequence

Also considered by the council at its Oct. 3 meeting was a request to modify the original development agreement for City Place. The intent was to relieve the timeline pressure on the developer to start utilities work immediately. The original agreement was standard for the city of Ann Arbor. It called for utilities work on water mains and storm sewers to be completed before construction could start.

The revised agreement on City Place doesn’t require the utilities work to be completed until later – before a certificate of occupancy is issued. So the revision gives the developer added flexibility to enter into negotiations with the city on the resubmittal of Heritage Row, which would require different utilities work.

City Place Construction: Council Deliberations

Carsten Hohnke (Ward 5) said the intent of the resolution has two elements: the assignment of the project to the new ownership; and modification of the construction sequence.

Hohnke asked city planning manager Wendy Rampson to explain the rationale for the standard requirement that off-site utility work be completed before on-site construction starts. Rampson said that if a building gets built without public utilities, you would have a completed building with no utilities in place. The standard requirement avoids that situation, she said.

Hohnke drew out the fact that Zaragon II had been a project where a pitted water main had slowed down work on off-site utilities and that the city had worked with the developer to allow off-site work and on-site construction to go on concurrently – the idea of allowing the adjustment of the requirement was not unprecedented.

Marcia Higgins (Ward 4) ventured that if Heritage Row were to be approved, the resolution would be moot.

Stephen Kunselman (Ward 3) was worried about the certificate of occupancy and wondered if the state statute stipulated when a certificate of occupancy could be granted. He indicated he would not be voting for it, based on that consideration.

Sabra Briere (Ward 1) said she could imagine that the council would approve the resolution on the construction sequence. She said she could also imagine that in three weeks, the council would not approve Heritage Row. She asked what the options were on that scenario. She wanted to know if the council could revisit the resolution and remove the arrangements about construction sequencing.

Assistant city attorney Kevin McDonald indicated that would not be appropriate – the developer asked for the construction sequence change to allow reconsideration of Heritage Row. The development team wanted to make sure they weren’t put at a loss with respect to carrying costs, with the construction season now coming to a close. Once that’s approved, he said, it would be in place permanently. Briere confirmed there would be no opportunity to revisit the issue.

In light of Kunselman’s expressed concern, Hohnke asked for confirmation from McDonald that the language had been reviewed and approved by the city attorney’s office.

Outcome: The council approved the alteration in the construction sequence with apparent dissent from Anglin, Briere and Kunselman, but no roll call vote was taken.

Intent on Street/Sidewalk Tax

Again on the council’s agenda, after being postponed at its last meeting, was a resolution of intent for the use of proceeds from a street/sidewalk repair millage that will be on the Nov. 8 ballot.

Voters will be asked to approve two separate proposals: (1) a 5-year renewal of a 2.0 mill tax to support street repair projects; and (2) an 0.125 mill tax to pay for sidewalk repair.

The resolution of intent would specify that the street repair millage will pay for the following activities: resurfacing or reconstruction of existing paved city streets and bridges, including on-street bicycle lanes and street intersections; construction of pedestrian refuge islands; reconstruction and construction of accessible street crossings and corner ramps; and preventive pavement maintenance (PPM) measures, including pavement crack sealing. [.pdf of resolution of intent]

The resolution of intent would stipulate that sidewalk repairs inside the Ann Arbor Downtown Development Authority district will not be funded by the sidewalk repair millage, except when the sidewalks are adjacent to single- and two-family houses. A recent meeting of the DDA’s operations committee revealed a measure of discontent on the DDA’s part about the intended restriction inside the DDA district and the lack of communication from the city of Ann Arbor to the DDA about that issue.

The resolution states that both inside and outside the DDA district (otherwise put, throughout the city), the sidewalk repair millage would be used only to pay for sidewalk repair adjacent to property on which the city levies a property tax. One impact of that resolution of intent, if it’s adopted, is that the city’s sidewalk repair millage will not be used to pay for repairs to sidewalks adjacent to University of Michigan property.

Intent on Sidewalk/Streets: Council Deliberations

Sabra Briere (Ward 1) who sponsored the resolution, began by noting that a phrase had inadvertently been dropped from the language of the resolution of intent in the editing from the last council meeting. She asked that it be re-inserted. It was part of the statement that the accounting for how the millage money would be spent would be separate, even though the revenue would be deposited into the same fund. Briere said this was a commitment that staff had made during the public information meetings about the millage. She moved an amendment that made the change.

Sue McCormick, the city’s public services area administrator, said that in the staff’s discussions with the public there was general support for flexibility in the sidewalk millage. The city may need to spend more than .0125 mills, or less, depending on the need. But McCormick said the city is committed to tracking what it’s spending on each kind of activity: sidewalk repair and bridges/street repair. It won’t be in separate funds, but the city will track it, she said. Tony Derezinski (Ward 2) asked if McCormick saw any problems with the language in the resolution of intent. She told him she saw no problems whatsoever.

Sandi Smith (Ward 1) asked about the DDA exclusion. She didn’t think the DDA was excluded in the ballot language, just in the resolution of intent. McCormick could not confirm Smith’s statement, saying she wished she had it in front of her. However, she did confirm for Smith that the exclusion was part of the discussion the city staff had with the public.

Smith asked what portion of the city’s sidewalks are inside the DDA district. McCormick didn’t know. Smith then asked what the revenue from the millage would be for the city compared to the DDA’s tax capture in the district – Smith ventured it was roughly a 2/3 to 1/3 split. McCormick said she could not speak to those numbers. [For Chronicle reporting on this, see: "Committee Briefed on Downtown Sidewalks"]

Smith then focused on the qualitative aspect of the exclusion instead of dwelling on the quantitative angle. The idea is that all properties inside the DDA would be excluded, except single-family houses and duplexes. McCormick contended that it’s consistent with what the DDA has done with sidewalk corner ramps. Smith asked if the DDA maintains responsibility for the sidewalks in the downtown – yes, answered McCormick. What about the vaults? Smith asked. McCormick characterized that as a private property issue. Smith asked if city staff would do sidewalk inspections inside the DDA. At that point, mayor John Hieftje asked Smith if she intended to be talking on the topic of the amendment. She replied, “Oh, I’m way off the amendment!” The council then approved the amendment Briere had suggested and Smith continued with her line of questions.

McCormick explained that city staff “could be available” for sidewalk inspections inside the DDA district, but that it has not been discussed. Smith inquired about the property across from the University of Michigan – like on State Street along the Diag – how will the city treat that? McCormick said she wished that Homayoon Pirooz, the city’s head of project management, were at the meeting – she couldn’t answer at that level of detail. Smith then apologized for not having it dawn on her until this point to ask about the DDA issue, and noted that no staff was present to address her questions. At that point, Smith moved for a postponement, saying, “I would beg indulgence to postpone for another two weeks.”

Derezinski asked if there was any timing problems associated with a delay. McCormick indicated there was not a problem – the idea is to have something in place before the Nov. 8 ballot.

Marcia Higgins (Ward 4) reminded her colleagues that when the issue was before the council at its previous meeting, they’d talked about using a fact sheet to tell people how the money will be spent. She asked if there was anything in the resolution of intent that is not in the fact sheet. McCormick described the language in the fact sheet and in the resolution of intent as “mutually supportive.” Higgins ventured that if the fact sheet is even more detailed than the resolution of intent, she was not sure the council needed to pass a resolution.

Hieftje noted that the conversation seemed to be wandering from the issue of postponement. Briere said she’d rather vote it up or down, instead of postponing. But in arguing for a resolution of intent instead of just a fact sheet, she reported that when she looked for fact sheets for the current millage, they’d disappeared. But a resolution of intent for the parks maintenance and capital improvements millage remained in the public record – you can find it again 20 years later. The fact sheet, however, can no longer be found on the city’s website. She said she agreed with whatever the rest of the council decides what to do, as long as they do something by the time of the election.

Briere said that Smith hadn’t noticed that the DDA exclusion was already in the resolution for the ballot language. A fact sheet is created for the public to present at public meetings, but a resolution is for the council to have a record to refer to in the future. It would be a benefit to future members of the council who want to know why previous members did what they did, she said.

The motion to postpone was then withdrawn in order to continue debate on the motion itself.

Higgins said she thought that Pirooz had the old fact sheet. She suggested that a way to approach the issue would be to do things administratively (with a fact sheet) instead of legislatively (with a resolution). The fact sheet is more detailed anyway, Higgins said.

Stephen Kunselman (Ward 3) said he was a little confused. He noted that the city staff drafted a fact sheet. What’s new this year on the fact sheet is preventive maintenance, which was not done in the past, he said. How does staff determine to take a reconstruction millage and do preventive maintenance? If the council passes a resolution, then when the staff holds public meetings, they could say the council has approved preventive maintenance.

Hieftje then asked McCormick how the street repair millage works for streets in the DDA district. McCormick explained that historically, in the old contract under which the DDA manages the public parking system, the DDA made a contribution to the street millage fund for maintenance of on-street parking lanes. Under the new contract, she explained, it’s a formulaic approach in which a lump sum payment is made by the DDA to the city, based on a percentage of gross parking revenues. Hieftje stated that his understanding is that the DDA has taken care of sidewalk repair for property owners.

Smith responded to Hieftje by saying that the way the resolution is worded, the DDA appears to be responsible for repairs but would not receive the full benefit of the millage, but would instead receive only a portion – due to the TIF capture. Based on her back-of-the-napkin calculations, it would be around $15,000, Smith said. Hieftje contended that the DDA had been handling sidewalk repair in the downtown all this time on their own. Smith countered, saying she was not sure that’s accurate.

Smith then reintroduced her motion to postpone. Hieftje said he’d support the postponement, given the uncertainty about the situation with the DDA sidewalks.

Briere took the perspective that staff has set its budget based on the expectation of doing things a certain way. If the resolution of intent were amended, and it changed the responsibility of who repaired sidewalks inside the DDA district, Briere wanted to know if that would significantly affect the budget. McCormick replied that it was hard to say. If more had to be spent on sidewalks, then less would be spent on bridge and street repair, she said.

Briere said given that the staff set the language in the ballot based on a set of assumptions. Briere did not have a problem with clarifying the situation with the DDA sidewalks, but only if it affects what the council decides. What benefit would the information bring to deliberations? she asked.

Outcome: The council approved postponing the resolution of intent on the use of street/sidewalk repair millage funds, over the dissent of Kunselman.

Rezoning for Med Marijuana

At its Oct. 3 meeting, the council was asked to rezone a South State Street property, so that it could be used as a medical marijuana dispensary.

The owner of Treecity Health Collective, a dispensary at 1712 S. State, had requested that the city planning commission recommend the location be rezoned from O (office) to C1 (local business). The owner had also asked that the area plan requirement for that location be waived. However, at their Aug. 16, 2011 meeting, planning commissioners recommended denial of the requests, based on a staff recommendation, stating that C1 zoning is not consistent with adjacent zoning, land uses and the city’s master plan.

And at their Sept. 19 meeting, councilmembers were hesitant to vote down the rezoning, and instead decided to delay their vote. The council is looking ahead to another rezoning request in the same vicinity on South State – for Biercamp Artisan Sausage and Jerky – and appears keen to treat them in parallel fashion. At its Sept. 8 meeting, the city planning commission recommended denial of Biercamp’s rezoning request, which would allow the sausage business to sell a greater variety of products beyond those manufactured on the site.

The Treecity Health Collective opened in 2010. This summer, the council approved amendments to the city’s zoning ordinances that prevent medical marijuana dispensaries from operating in office zoning districts – those changes were set to take effect on Aug. 22, 2011. Rather than relocate the dispensary, the business asked for the zoning change. The property – located on the west side of State, south of Stimson – is owned by Francis Clark.

A recent court of appeals ruling has raised legal questions about the existence of dispensaries under Michigan’s Medical Marijuana Act. However, the Ann Arbor city council decided at its Sept. 6 meeting to proceed with the appointment of four out of the five members of its medical marijuana licensing board and subsequently appointed the fifth member. That body met for the first time on Sept. 21.

Medical Marijuana Rezoning: Public Commentary

Dennis Hayes began by quipping that just when the council thought they could get rid of him, he was back again. He told councilmembers that Treecity Health Collective has been working hard to comply with numerous requests from the city. Treecity has been in contact with the city attorney’s office and the planning staff and and have been quite diligent, he said. He understood that the requested zoning by Treecity is not part of the master plan, but he thinks it’s an appropriate use. It’s a nice space that was built up quite nicely, he said.

Hayes also mentioned that city planning staff has demanded information about the operation of medical marijuana businesses, based on a court of appeals decision from a couple of weeks ago: People v. McQueen. Hayes criticized the city attorney for adopting the Michigan attorney general’s analysis of the lawsuit, which is a disservice to the law and to the office of the attorney general, Hayes said. The attorney general was dealing with medical marijuana patients by “taking a chainsaw” to the statute, he said.

Hayes encouraged the councilmembers who are lawyers to read the language in the McQueen case. He said he did not think the language in the case stands for the proposition that the city attorney has asserted. The case simply says you can’t sell it for profit in Michigan, which is not news, he said.

One of the problems on a larger scale, he said, is that it’s difficult to find places to accept medical marijuana collectives. He hoped that the approval process with the licensing board would take that into account.

Medical Marijuana Rezoning: Council Deliberations

Sandi Smith (Ward 1) led off deliberations saying she was a bit conflicted. She said the staff recommendation against the rezoning is based on the idea that rezoning would go against the city’s master plan. But she said that in going over the notes from the planning commission, she’d noticed that changes to the zoning are not to be undertaken “except to correct an error in the Chapter, because of a change in municipal policy, or because of changed or changing conditions in a particular area or in the municipality generally, to rezone an area, extend the boundary of an existing Zoning District or to change the regulations and restrictions thereof.”

Smith said she felt the Produce Station, located nearby at 1629 S. State St., has changed the particular area tremendously. She did not feel it’s strictly speaking a “spot zoning,” as the planning staff had concluded. Smith invited Wendy Rampson, head of city planning, to come to the podium and help her to go through her thoughts. Why wasn’t changing conditions pertinent in this case?

Rampson told Smith that it is pertinent – for the whole State Street corridor, viewed from Stimson down to Ellsworth. The planning commission grappled with that, but it is a small piece of land, Rampson said, so to take one piece out of context wasn’t appropriate. There wasn’t sufficient justification for the rezoning.

Smith said it seemed that the row of 10 houses on the west side of the street had retail-like businesses. Did that have any relevance? Rampson told Smith that in looking at the whole corridor it would be relevant. Alluding to the use of the existing property as a medical marijuana collective, Rampson said there are some current uses that were determined without the benefit of permits. She noted that the property on which the Biercamp business is located was annexed into Ann Arbor from Ann Arbor Township with zoning grandfathered in from the township, even though the business hadn’t originally been legally established in the township.

Tony Derezinski (Ward 2) said that as the city council representative on the planning commission, he agreed with what Rampson said. Once you start, it’s a slippery slope, he cautioned. This rezoning request, said Derezinski, underscores why the city needs to have a corridor study. It reminded him of the R4C/R2A situation, in which the zoning needed to accomodate the changes that are happening. [The city formed an advisory committee to study R4C/R2A zoning. A final recommendation hasn't yet been presented.] After the Washtenaw Avenue corridor, he said, the State Street corridor was the planning commission’s second priority.

Alluding to the planned construction of a Costco at the intersection of State and Ellsworth, Derezinski noted that the corridor would soon include a big-box store. Any consideration of rezoning should be done comprehensively, he said – that was the reason for the planning commission action on this matter.

Stephen Kunselman (Ward 3) asked Rampson to describe conditional rezoning. He wanted to know if that would still be an option that could be pursued if the council decided to deny the current rezoning request.

Rampson indicated that it could be brought back as a conditional rezoning request. The business had contacted the city about that option and informational materials had been provided, she said. She described conditional rezoning as allowing a property owner to come to the city with a request and voluntarily restrict itself to a particular use, in order to proceed with a particular zoning.

For example, Rampson said, a restriction could be to use it as a medical marijuana dispensary. A business at the location of Ellsworth and Platt is the one example of the application of this kind of tool in the city, she said. That business is restricted from alcohol sales, she said. She called it a relatively new tool.

Rampson invited assistant city attorney Kevin McDonald to comment. He characterized conditional rezoning as a really broad statute that the legislature created where a property owner can “offer and voluntarily accept a condition on zoning.”

As far as the timing issue, Rampson said a new request could go to the planning commission, or the current request could be paused at this point. The challenge for this petitioner, Rampson said, was the timing related to the medical marijuana licensing ordinance.

Kunselman thought this situation was a good example of where conditional rezoning would work. The business is already operational under the current condition, he said. If it comes back as a request under conditional rezoning, he said, he would support it.

Outcome: The council voted against approval of the rezoning request, with dissent from Mike Anglin, Sabra Briere and Sandi Smith.

Property Assessed Clean Energy (PACE) District

The council was asked to consider a resolution to establish an Energy Financing District and a Property Assessed Clean Energy program (PACE). The council had formally expressed its intention to establish an Energy Financing District and a PACE. The vote came after a formal public hearing.

The resolution of intent refers to a report, which describes in detail the project and property eligibility for PACE, as well as project size, application process, and financing, among other elements.

At its March 7, 2011 meeting, the council had voted to set up a $432,800 loan loss reserve fund to support the city’s planned PACE program. The money for the fund comes from an Energy Efficiency and Conservation Block Grant (EECBG) awarded to the city by the U.S. Department of Energy.

Through its PACE program, the city of Ann Arbor will help commercial property owners finance energy improvements through voluntary special assessments. By establishing a loan loss pool, the city can reduce interest rates for participating property owners by covering a portion of delinquent or defaulted payments. [Some previous Chronicle coverage of PACE: "Special District Might Fund Energy Program"]

PACE: Public Hearing

Thomas Partridge introduced himself as an advocate for senior citizens and disabled persons who need the advantages of the improvements. He applauded this step, but called attention to the fact that most of the benefits are generally aimed at businesses – the most profitable businesses. There should be an “equal rights amendment,” Partridge said, to make it available to residents as well. He told the council they should ensure the district is as wide as possible – the entire county is possible.

Conan Smith is a Washtenaw County commissioner from Ann Arbor and is married to state Sen. Rebekah Warren, who has claimed a lot of the credit for the PACE legislation. Smith appeared during public commentary to say how excited he was about it. It’s one of the best things we can do, Smith said, and the fact that Ann Arbor is at the forefront is something to be proud of. The “green economy” is important for the future, he said. At the county level, Smith said, he would like to look at the work that is happening in the city and try to replicate that in smaller units of government across the county.

Smith noted that the the smaller townships wouldn’t be able to offer the bonds necessary for the program, but he thought that funding could be aggregated at the county level so that the program could be expanded. He thanked the council for taking the lead on the issue. He also thanked city environmental coordinator Matt Naud and others for their work on the issue.

PACE: Council Deliberations

Sandi Smith (Ward 1) [not related to Conan Smith] said she was pleased to see the program come forward. She described the Ann Arbor Downtown Development Authority’s energy grant program as a kind of “pilot program” for PACE. She hoped eventually it would be available for residential properties. It would result in better buildings and less waste on energy.

Sabra Briere (Ward 1) asked for clarification about what properties are eligible. Wendy Barrot, who is administering the program for the city of Ann Arbor, explained that if a property has three or more units, it’s eligible. Mayor John Hieftje ticked through names of people he wanted to thank for moving the program forward.

Outcome: The council voted unanimously to establish the PACE district.

Annexations: Scio to Ann Arbor

The city council was asked to consider annexations of six properties on the west side of the city, all inside a well prohibition zone that was expanded in March 2011. The expansion of the zone came as a result of a consent agreement between the Michigan Dept. of Natural Resources and Environment, which relaxed environmental cleanup requirements on Pall Corp. The previous prohibition zone had been established because of 1,4 dioxane groundwater contamination caused by the Pall’s Wagner Road facility, formerly owned by Gelman Sciences.

Annexation will allow these properties to connect to city of Ann Arbor water services. Pall has paid all petition filing fees as well as the connection and improvement charges for water and sanitary sewer service that are related to the annexations. All of the parcels are currently part of Scio Township. They will be annexed with the R1C (single-family residential) category. These annexations are not part of the systematic township-to-city annexation strategy authorized by the city council at its Sept. 19, 2011 meeting.

[Google map of well prohibition zones and property locations] [.jpg of map with well prohibition zones and property locations]

Annexations: Public Hearings

Each annexation included a public hearing. Thomas Partridge spoke at only one of them.

Partridge introduced himself as a past candidate for the county board and for the state senate, and asked the council to delay action on all the annexation resolutions. It’s taking property away from the townships along with the property tax revenue that townships need. He called for state legislation to make consolidation of city and county governments possible, similar to what is being contemplated in the Grand Rapids area.

During council communications following the public hearings, Sabra Briere (Ward 1) gave a reminder to the public that each of the properties being annexed has its own reasons. The dioxane plume might have something to do with it, she said. She stressed that this is not a “cluster” that is part of the city’s recently enacted strategy for systematically annexing township islands into the city. She noted that all of the property owners are asking to leave Scio Township and join the city of Ann Arbor.

Outcome: The council unanimously approved the annexations on separate votes.

DTE Gas Line Easement

On the council’s Oct. 3 agenda was a resolution granting an easement to DTE Energy for the installation of a gas main pipe north of Fuller Road in Fuller Park. The easement includes a number of requirements on DTE related to the gas line installation. DTE will need to use horizontal boring, instead of trenching, for the section of pipe near the Fuller Road pool entrance.

The easement also includes a number of requirements to protect trees in the vicinity. For example, no roots greater than two inches in diameter are to be cut except with authorization of a city forester, and no equipment can be stored under the dripline of any city-owned tree.

DTE Easement: Public Commentary

Rita Mitchell addressed the council on the grant of easement to DTE. The council information packet provides maps and the resolution, but no documentation of the language for the agreement between the city and DTE. She said that she felt it was important that the council and the public really understand what’s in the agreement. She criticized the fact that the context for the change is not provided – the location of existing gas lines and the reason for making the change is not provided. So she urged the council to defer action.

Mitchell said she believed the easement work was an attempt to move ahead with the Fuller Road Station without labeling it as such on the agenda. [Fuller Road Station is a proposed large parking structure, bus depot and possible train station, to be built on city-owned property in partnership with the University of Michigan. It has been criticized for its location on land designated as parkland. A surface parking lot is currently located on the site.]

Mitchell wanted to know what the city cost will be? Will the land that’s being granted belong to DTE? If so, that would be giving away parkland without a vote by the public, she said. Is the easement revocable? If it’s not, then it’s a gift, she said. She told the council that they are the ones who control the parkland and that they need to follow Chapter 34 of the city code in making their decision. [Chapter 34 concerns the grant of gas franchise.]

DTE Easement: Council Deliberations

Sabra Briere (Ward 1) asked who’s being served by the utilities work. Paul Ganz – DTE Energy regional manager for the counties of Ingham, Jackson, Livingston and most of Washtenaw – described it as a “garden variety easement request” to replace infrastructure that serves the entire city. It’s part of a federally-mandated effort to make sure gas infrastructure meets all new specifications, he said.

A high-pressure main will be replaced, Ganz said. It would provide service from the Maiden Lane regulator. The main serves a vault that disperses gas throughout that area of the city. It is typically at around 300 pounds of pressure. By way of comparison, Ganz said, a house is served at about 1/4 pound of pressure or the city hall at around 2 pounds of pressure.

Ganz said he expected the work would be completed in about four weeks. It’s a typical agreement that is struck between MichCon and municipalities. He noted that it sometimes requires the city and his company to work around each other, and said he appreciated consideration they received from the city of Ann Arbor staff.

Briere asked why the main was not installed under the road instead of in the park. The answer, from Barbara Rykwalder of DTE, was that they did not want to obstruct traffic on Fuller Road.

Stephen Kunselman (Ward 3) got confirmation that there’s an existing pipeline with probably an existing easement.

Mike Anglin (Ward 5) asked if there was any relation of the project to Fuller Road Station. Rykwalder explained that the work to be done is due purely to a federal mandate – the pipeline needs to be replaced and DTE was abiding by a federal mandate.

Anglin then asked if the city would still own the land. Kevin McDonald of the city attorney’s office explained that an easement granted use of land, but ownership would remain with the city.

Work Session: Nov. 14

The council was asked to consider a resolution to add a work session to its calendar for Nov. 14, 2011. At the council’s Sept. 19 meeting, the council had voted to postpone consideration of a proposed amendment to the city’s public art ordinance – councilmembers expressed an interest in having a working session on the topic before voting on the proposed amendment to the public art ordinance. The public art ordinance taps 1% of all capital improvement project budgets to pay for public art.

The resolution itself did not specify the topic of the working session. It simply indicates: “Due to the numerous activities developing in the City, it is necessary to schedule an additional work session to bring Council up to date;”

Outcome: The council voted unanimously to add a Nov. 14 work session to the calendar.

Ann Arbor Housing Commission Liaison

Near the conclusion of the meeting, mayor John Hieftje seemed prepared to forgo any additional transactions after confirmation of some appointments to the city’s human rights commission. But Stephen Kunselman (Ward 3) reminded Hieftje that at the previous meeting, on Sept. 19, Hieftje had said he would be nominating Margie Teall (Ward 4) as the council’s liaison to the Ann Arbor Housing Commission.

The revelation at that Sept. 19 meeting also came at Kunselman’s prodding, after Kunselman had offered at the Sept. 6 meeting to serve as the replacement for Tony Derezinski (Ward 2) as liaison. Derezinski had asked to be excused from that position, in order to serve on the city’s public art commission, after Jeff Meyers resigned from that post.

Hieftje made the nomination of Teall as housing commission liaison.

Outcome: The council voted unanimously to approve Teall’s appointment as council liaison to the Ann Arbor Housing Commission.

Habitat for Humanities Lawsuit Settlement

A late addition to the agenda asked the council to authorize settlement of a lawsuit. The authorized settlement resulted in the payment of $229.12 by Habitat for Humanities to the city of Ann Arbor. One of the defendants in the suit was the University of Michigan.

In contrast to the city of Ann Arbor, the university’s legal department makes its litigation reports easily accessible to the public. From the UM May 2011 litigation report to the board of regents:

Habitat for Humanity of Huron Valley v Angela Rowlands, The Regents of the University of Michigan and its Housing Bureau for Seniors, and the City of Ann Arbor. Washtenaw County Circuit Court. (Judge Archie C. Brown) (Served April 18, 2011 ).

Plaintiff alleges that Defendant Rowlands defaulted on a mortgage which was payable to Habitat for Humanity. The Housing Bureau for Seniors holds a second mortgage on the property. Habitat claims that defendants Regents and the City claim an interest in the property but that such interests are subordinate to the mortgage interest of Habitat. Plaintiff Habitat seeks payment of the note and mortgage, plus costs and attorney fees, from defendant Rowlands or, in the alternative, asks the court to allow the mortgage to be foreclosed and the premises sold at public sale with the proceeds paid to Habitat. Habitat also asks the court to determine that the interests held by the Regents and the City are subordinate to Habitat’s interests.

Outcome: Without comment, the council approved the settlement of the case involving Habitat for Humanities.

Fuller Road Station, Transportation

Although the council had an item on its agenda in the same geographic vicinity as the proposed Fuller Road Station – the DTE gas main easement – there were no items involving a vote specifically on that project. However, public commentary on that easement (from Rita Mitchell, see above) raised questions about the possible connection of that work to the planned transit station and parking structure.

Other parts of the meeting also included discussion of the proposed Fuller Road Station.

Fuller Road Station: Public Commentary

Libby Hunter delivered her public commentary, as has become her custom, in the form of some familiar tune with revised lyrics. The tune was “This Land Is Your Land,” featuring commentary on the proposed Fuller Road Station. Lyrics  included “This park’s not made for you and me” and “It’s Go Blue land,” a critical allusion to the University of Michigan’s role in the proposed deal. A reference to mayor John Hieftje was also included in the lyrics: “He stole our park land.”

Fuller Road Station: Council, Administrator Communications

During a slot on the agenda reserved for council communications, Mike Anglin (Ward 5) said he wanted to read aloud a communication he’d received from a constituent about Fuller Road Station. The project seemed to be proceeding without an “absolute vote” of the council, he said. The communication indicated strong opposition to any planning for Fuller Road Station without a public referendum. The current proposal for the land is in the form of a lease, which seemed like a way to circumvent the requirement that the sale of city parkland be subjected to a public referendem. Having a referendum, even on the lease of the land, would abide by the spirit of the charter requirement.

Responding to Anglin, Hieftje said he had some news about the Fuller Road Station project, pointedly referring to the portion of Fuller Park where the project is to be built as the “paved parking lot across the street from the Fuller Park pool and soccer complex.” He said the federal government had previously awarded $2.8 million for the first phase of the Fuller Road Station, and the news was that the funds had now been formally obligated.

Hieftje also described the action by the Michigan state legislature as “tremendous news” for rail transportation in Michigan because $160 million had been secured in federal matching funds, which will come with an additional $200 million – bringing a total of roughly $380 million to the state. That will ensure the purchase of the rail line between Ann Arbor and Kalamazoo by the Michigan Dept. of Transportation, and that the improvements needed to bring the track up to standards necessary for high-speed rail are made, Hieftje said. The track improvements needed for commuter rail will be part of that, he said.

Hieftje said he had told the city’s transportation program manager Eli Cooper to take up the issue of finding locations for possible sidings with Sandi Smith (Ward 1) and and Sabra Briere (Ward 1). MDOT already owns the trains, he noted, and he’d learned on NPR that the sale of the rail from Norfolk Southern might come as early as next week. [A deal was announced on Wednesday, Oct. 5.]

Briere responded to the mayor by thanking him for the update. She said she was grateful he had mentioned the rolling stock, and that it was good to remind people that what they’re waiting on is the track. When the sale is completed, Briere said, the 25 mph limit on trains could be lifted, once the track is brought up to standard. Hieftje stated that Norfolk Southern has known for the last 1.5-2 years that it would be selling the track. He likened the situation to that of a homeowner who has already sold their house – you don’t spend a lot of money fixing it up.

Hieftje followed up again on the rolling stock by noting that the cars, outfitted with new seats, had received crash test certification.

From city administrator Steve Powers’ communications, one highlight involved transportation. He noted that the Oct. 10 city council work session would focus on the high-capacity connector feasibility study. [For background, see: "AATA: Transit Study, Planning Updates"]

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: ICMA Visitors

At the city planning commission’s Sept. 8 meeting, Wendy Rampson, head of planning for the city, had told commissioners about some visitors from Indonesia that the city is hosting through an International City/County Management Association (ICMA) sustainability fellows program. At Monday’s council meeting, she introduced them: Olah Sajekti and Cesaria Hafstuti.

Comm/Comm: Government Consolidation

Tony Derezinski (Ward 2) responded to comments by Thomas Partridge during a public hearing on annexations into Ann Arbor suggesting the consolidation of different levels of government. Derezinski said the council is not unaware of the One Kent proposal to which Partridge had alluded. [Reporting on the One Kent proposal from Grand Rapids Institute for Information Democracy: "Update on One Kent Local Government Consolidation Proposal"]

Derezinski said that councilmembers had talked to Grand Rapids mayor George Heartwell. The council is trying to get more regional collaboration, Derezinski said. The Grand Rapids proposal has been talked about a long time, he said– as long ago as back when he practiced law there in the 1970s.

Derezinski said that not all regional governments work, but some do. Indianapolis is a good example of one that works, he said. In the conversations about consolidation, there is a lot of emphasis on power sharing, which is a main obstacle. There are differences between Ann Arbor and Grand Rapids, he noted. But Grand Rapids is a comparable city to Ann Arbor in terms of the future of the state, he contended. “Stay tuned on that one,” Derezinski said. “There’s a lot more to come.”

Comm/Comm: Partridge

Thomas Partridge told the council that he had been a witness to history when John F. Kennedy came to Ann Arbor and proposed the Peace Corps, as well as when Lyndon Johnson had proposed the Great Society program. Partridge asked the council to remember the efforts in the 1960s to improve society, mentioning programs like Head Start. All issues are ultimately tied to the issue of civil rights, he said. He called on the council, in light of the unfinished work of the 1960s, to prioritize an agenda to address the need for affordable housing by requiring that every developer develop quality housing, not aimed at students.

At the conclusion of the council’s meeting during public commentary time, Partridge criticized bullying being perpetrated by Republican leaders in the state. He said he was disappointed that state representatives did not attend the council meeting to talk about their efforts in the legislature to stop the dishonorable bullying being carried out in the state of Michigan. Partridge said that in 2010 he had run for the senate seat now held by Rebekah Warren, but that she doesn’t appear at council meetings to convey what her stances are and what her votes are. [Warren attended part of the meeting that night in connection with the establishment of a PACE district – she played a role in enacting the state's enabling legislation.]

Comm/Comm: League of Local Government

Kermit Schlansker proposed a league of local governments that would include the city, county and state, and that could finance pilot projects that are important to the needs of the people, he said. Progress would then not be contingent on the uncertainties of national politics. As an example, he suggested a car specified as a four-passenger, hybrid car costing less than $18,000, built in the U.S. and getting 45 mpg. If the sale of 10,000 such cars were guaranteed, then the car would be built, he suggested. Schlansker went on to describe how a league of local governments could support energy farms.

Comm/Comm: Palestine

Henry Herskovitz told the council he wanted to address an issue of fairness. He drew an analogy from the local city code to international politics. He noted that Ann Arbor requires a window-unit air conditioner to be in the rear. If he wanted to install it on the side, he had to get support from his neighbors, he said. His neighbors’ opinions matter more, when it comes to his air conditioner, and that makes sense, he said. The opinion of someone who lives miles away, he said, should matter less.

Herskovitz continued by noting that in this summer’s edition of the Washtenaw Jewish News, Victor Lieberman appeals to the United Nations vote of 1947 to argue for the legitimacy of the state of Israel. The outcome of that vote, Herskovitz said, was 33-13, with 10 abstaining. Applying Ann Arbor’s doctrine of fairness, the votes from those countries that would be most impacted by creating a new state in that area should count for more. The group that was most impacted by the decision – Palestineans – had no vote whatsoever. He showed the council a map of the world.

Countries that voted no in 1947 included Turkey, Jordan, Lebanon, Saudi Arabia, Egypt, Iran and Yemen. Those are neighbors to Palestine, he said, and their votes should have counted more than the votes of those far away. Countries that voted yes in 1947 included the United States, Canada, Brazil, Bolivia, Norway, Australia and New Zealand. The 1947 vote didn’t represent the interests of those people who were most impacted by the decision. The unfairness of that decision, Herskovitz concluded, undermines the claim, based on the 1947 vote, to the legitimacy of the state of Israel.

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, Oct. 17, 2011 at 7 p.m. in the council chambers at 301 E. Huron. [confirm date]

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