The county’s position is that Act 88 can be levied without voter approval to fund economic development and agricultural activities. This year, the proposal is to levy 0.07 mills in December 2014 – the same rate that was levied in 2013. It’s expected to raise an estimated $1,022,276 in property tax revenues.

In previous years, the resolution setting this millage has outlined how the revenues would be allocated. The largest allocations have gone to the county’s office of community & economic development, and to the nonprofit Ann Arbor SPARK.

However, at its Nov. 6, 2013 meeting, the board adopted a new policy for allocating Act 88 revenues, drafted by Conan Smith (D-District 9). [.pdf of Act 88 policy] The policy included creating an Act 88 advisory committee to make recommendations to the board and prepare an annual report that assesses how Act 88 expenditures have contributed toward progress of goals adopted by the board. The policy allows the committee to distribute up to 10% of annual Act 88 revenues without seeking board approval. The policy also allocates up to 30% of revenues to the county office of community & economic development, which administers Act 88 funding.

This year, the 10% amounts to $91,753. Of that, $3,993 remains unallocated and will stay in the Act 88 fund balance to support future projects. Beyond that, a total of $87,760 in funding was allocated for six projects initiated by two organizations – the Michigan State University Product Center, and Ypsilanti-based Growing Hope [.pdf of staff memo]:

• $10,060 to the MSU Product Center to study the potential for enhanced food processing in Washtenaw County.
• $12,700 to the MSU Product Center to develop “MarketMaker,” a food industry business network and database.
• $20,000 to Growing Hope/Reconsider to run community education events on the Michigan Invests Locally Exemption Act and to study the potential and processes for investing locally in Washtenaw County.
• $13,000 to Growing Hope/Revalue to provide two full-day educational events to assist investors in incorporating local investment offerings into their financial plans.
• $13,000 to Growing Hope to create a study on increasing food assistance sales at farmers markets in Washtenaw County.
• $19,000 to Growing Hope to support the development of an Ypsilanti “MarketPlace,” a year-round farmer’s market, and “MarketHub,” a food distribution center serving underserved communities.

These recommendations were made to the county board by the Act 88 advisory committee. Members are: County commissioners Ronnie Peterson (D-District 6), Alicia Ping (R-District 3) and Conan Smith (D-District 9); Todd Clark, president of United Bank & Trust; and Art Serafinski, chair of the Ypsilanti Convention & Visitors Bureau board. Staff support was provided by the county’s office of community & economic development.

During the Aug. 6 meeting, commissioner Dan Smith (R-District 2) brought forward an amendment for both the projects resolution and the resolution to levy the tax this year. After some discussion among commissioners, the board unanimously passed this amendment on the projects resolution [strike-through reflects a clause that was struck during deliberations]:

FURTHERMORE BE IT RESOLVED that the Washtenaw County Board of Commissioners directs Corporation Counsel to provide an exhaustive written opinion, by December 31, 2014, detailing the lawful uses of sums raised under Act 88 of 1913 (MCLA 46.161), and that this opinion address in similar manner other possible interpretations.

A similar amendment was passed unanimously for the resolution to levy Act 88:

FURTHERMORE BE IT RESOLVED that the Washtenaw County Board of Commissioners directs Corporation Counsel to provide an exhaustive written opinion, by October 1, 2014, detailing the exact mechanism under which Act 88 of 1913 taxes may be levied in excess of Article IX, Section 6 constitutional limits without a vote of the people.

This brief was filed from the boardroom at the county administration building, 220 N. Main St. in Ann Arbor. A more detailed report will follow.

Carrie Leahy is chair of the LDFA board.

The council’s meeting was of more than just passing interest to the LDFA board members – because the council voted at that meeting to table a $75,000 contract for business development services with Ann Arbor SPARK, a local nonprofit economic development agency. Ann Arbor SPARK is also the LDFA’s contractor – but not for the same kind of services that SPARK delivers under its contract with the city. The council will likely take up its contract with SPARK again at a future meeting, possibly as soon as July 7.

The city’s annual contract with SPARK, which is paid for with general fund money, is meant to cover the attraction and retention of mature companies to the Ann Arbor area. In contrast, the LDFA contracts with SPARK for entrepreneurial support services – for companies that are in some phase of starting up.

On the LDFA board’s June 17 agenda was the annual contract with Ann Arbor SPARK for entrepreneurial support services – which the board voted to approve. This year that contract is worth nearly $2 million – $1,891,000 to be exact.

An unsuccessful bid by councilmembers made during the city’s FY 2015 budget deliberations would have reduced the total LDFA expenditures by $165,379. The goal of that expenditure reduction would have been to increase the fund balance that was available for infrastructure improvements in the LDFA district – specifically, for high-speed telecommunications. At the LDFA’s June 17 meeting, city CFO Tom Crawford indicated that sometime in the FY 2015 fiscal year, the city would be making a proposal to install fiber throughout Ann Arbor.

The contract between the LDFA and SPARK covers a range of items, with the top two line items consisting of staffing for the business incubator ($420,000) and provision of services to start-up companies in Phase III of their development ($550,000). SPARK classifies its engagement with companies in terms of phases: preliminary screenings (Phase I); due diligence (Phase II); intensive advising (Phase III); and accelerating opportunities (Phase IV). [.pdf of FY 2015 budget line items] [.pdf of LDFA-SPARK FY 2015 contract]

At its June 17 meeting, the LDFA board also approved a routine annual $42,600 contract with the city of Ann Arbor – for administrative support services. Those include items like the preparation of meeting minutes, stewardship of public documents, and preparation of budgetary analyses. [.pdf of FY 2015 LDFA contract with city of Ann Arbor]

The final voting item for the board was approval of its meeting schedule for the next fiscal year. The LDFA board meets in eight out of 12 months, with the next meeting taking place on July 15, 2014, starting at 8:15 a.m. in the city council chambers. [.pdf of 2014-2015 meeting schedule]

These voting items did not, however, generate the majority of the board’s discussion at its June 17 meeting.

The board focused most of its discussion on issues surrounding its application for an extension of the LDFA past its current 15-year lifespan, which ends in 2018. Legislation passed in 2012 allowed for either a 5-year or a 15-year extension – with different criteria for those time periods. The 15-year extension requires an agreement with a satellite LDFA, with two communities currently under consideration to partner with Ann Arbor’s LDFA: Brighton and Adrian. Flint had also been a possibility, but is no longer on the table.

With an extension, the LDFA would continue to capture school operating millage money, which would otherwise go to the state’s School Aid Fund. At least some of the school taxes subject to capture by LDFAs statewide are required to be reimbursed to the School Aid Fund by the state. Questions about how that applies to Ann Arbor’s LDFA have been raised – and a review of the state statute appears to support the conclusion that the key clause requiring reimbursement is inapplicable to the Ann Arbor SmartZone LDFA. That understanding was confirmed to The Chronicle by the Michigan Dept. of Treasury communications staff in a telephone interview on June 23.

The exact nature of that tax capture arrangement and possible reimbursement was also the subject of LDFA board discussion on June 17 – because the LDFA board is being pressed by city councilmembers to account for how the LDFA tax capture impacts the state’s School Aid Fund. Board member Stephen Rapundalo expressed some frustration about that – based on his perception that this material had been well explained in the past: “What’s it take – for them to understand unambiguously how that works? I mean, we have told them. Why is the onus on the LDFA to have to show them that?”

Besides the tax capture mechanism, two other issues raised by city councilmembers are factoring into the LDFA board’s approach to seeking an extension of its term. Board chair Carrie Leahy told her colleagues that she took away two main messages from recent appearances in front of the Ann Arbor city council. Some councilmembers, she said, would like to see: (1) an independent audit of job creation numbers; and (2) a provision for infrastructure investments as part of an LDFA extension.

On the infrastructure side, the LDFA board’s discussion focused on the existing TIF (tax increment finance)/development plan, which provides for investments in high-speed telecommunications (fiber) networks, but not for projects like street construction, sewer construction and streetlight installation. The question was raised as to whether the LDFA could use its school tax capture to pay for a fiber network in the whole geographic district of the LDFA – or if school taxes could only be used to fund a fiber network to an business incubator.

The Ann Arbor LDFA’s district covers the geographic areas of the Ann Arbor and Ypsilanti downtown development authorities – although Ypsilanti’s DDA area does not generate any LDFA tax capture. As a consequence, money captured by the LDFA is not spent in the Ypsilanti portion of the district. But that could change under an extension of the LDFA – based on board discussion at the June 17 meeting.

On the job creation numbers audit, the June 17 board discussion indicated that the LDFA will now be looking possibly to incorporate a job numbers audit as part of an upcoming financial audit. The financial auditing firm will be asked to provide some explanation of how it might be able to incorporate a jobs audit as part of its scope of work for the upcoming financial audit. The board appears to understand that some type of jobs audit would be important for winning ultimate city council support for a 15-year extension of the LDFA.

The city council’s representative to the LDFA board, Sally Petersen, made that explicit more than once during the June 17 meeting, saying that “taking the lead on establishing an independent audit would go a long way towards getting city council support for an extension.”

The LDFA’s deliberations and other agenda items are reported in more detail below.

Ann Arbor SPARK’s Two Roles

Some of the political chaffing surrounding Ann Arbor SPARK involves a lack of clarity about roles played by SPARK – which are, from SPARK’s perspective, clearly separate and distinct: (1) a somewhat conventional economic and business development agency that attempts to retain mature companies in the Ann Arbor area, and also to attract mature companies to locate in this area; and (2) an organization that provides entrepreneurial services to start-up companies and nurtures them toward commercialization. It’s this second role for which the LDFA contracts with SPARK.

At one point during the June 17 LDFA board meeting, Luke Bonner – SPARK’s vice president of business development – sought to clarify these two distinct roles. Bonner heads up SPARK’s efforts to retain and attract new fully-formed companies. Bonner got clarification that Ann Arbor city council’s discussion the previous evening had centered on the $75,000 business services contract between the city of Ann Arbor and SPARK.

The business development team at Ann Arbor SPARK – of which Bonner is a part – is not under contract with the LDFA, he pointed out. Instead, SPARK’s business development team is under contract with Washtenaw County, the city of Ann Arbor, various other municipalities in Washtenaw County, and Livingston County – in addition to all of the private funding received by Ann Arbor SPARK.

Bonner stressed that the business development and the entrepreneurial services teams operate in two different worlds. Bill Mayer, SPARK’s vice president for entrepreneurial services, followed up Bonner’s observation by pointing out that the kind of companies that Bonner deals with are too big for him to be able to help under the SmartZone (LDFA) guidelines. Mayer described the situation at Ann Arbor SPARK as two separate paths, but under one banner.

Mayer stressed that reports required by the Michigan Economic Development Corp. (MEDC) entail reporting different kinds of numbers. The issue of these different numbers from different reports has been raised as a concern by some members of the public, as well as by some councilmembers.

For outside observers, including some councilmembers, SPARK’s two distinct roles are not as self-evidently separate – because they both fly under the same banner of Ann Arbor SPARK.

The $75,000 contract to which Bonner referred was between the city of Ann Arbor and SPARK for its role as an agency that attracts and retains mature companies.  At the council’s June 16 meeting, the parliamentary motion used to deal with the contract was to “table” the question, which is not debatable under Robert’s Rule of order – so the council voted on the tabling motion, without additional deliberations. That vote came out 6-5 in favor of tabling. With that the council moved along on its agenda.

But at the end of the June 16 council meeting, Ward 1 councilmember Sabra Briere brought up the issue during the council communications time, saying that Ann Arbor SPARK CEO Paul Krutko had expected to be asked questions and respond to councilmembers’ concerns – but that had not happened. Briere alluded to the fact that the issue might come back before the council “sooner rather than later,”  but she wanted Krutko to be able answer some questions at that time – as he had remained in the council chambers until that point.

In the course of the back and forth, Ward 2 councilmember Jane Lumm told Krutko that she would have preferred to postpone it. But in talking to her colleagues during the break, Lumm said, there was greater interest in tabling the resolution.

The back-and-forth between the council and Krutko ultimately did not result in a motion by any councilmember to take up the resolution off the table for a vote. It appears likely that the council will consider the question at its July 7 meeting.

Some of the disparity of jobs numbers in SPARK’s reporting, as claimed by SPARK’s critics, appears to be due to reports that cover different activities: SPARK’s overall business development impact, as opposed to reports made to the state legislature and related to various state grants. [Ann Arbor SPARK 2013 annual report] and [21st Century Jobs Trust Fund 2013 Annual Report]

Contributing to the lack of definiteness on the numbers reported by SPARK is the fact that SPARK uses self-reported company figures for projected jobs – as opposed to independently verifying the creation of actual jobs. That independent verification is not necessarily straightforward, because SPARK may not be able to compel a company to disclose records that would allow such independent verification of a company’s self-reported jobs claims.

SPARK as LDFA Contractor

The LDFA board deals with Ann Arbor SPARK as its contractor for entrepreneurial services – not as an attractor and retainer of companies in the area. And the June 17 LDFA board meeting reflected that. On the agenda were three items related to that specific function of SPARK – the treasurer’s report, the report from SPARK, and the annual contract between the LDFA and SPARK.

SPARK as LDFA Contractor: Treasurer’s Report

Eric Jacobson gave the treasurer’s report. As of the end of May, he could report that spending by the LDFA’s contractor, Ann Arbor SPARK, was well below the amount budgeted for the year. There was an overall positive variance of about $76,000.

Eric Jacobson is the LDFA board treasurer.

He noted that Ann Arbor SPARK had exceeded its budget in two categories – but in both categories the amount by which it had exceeded budget is well below the threshold constrained by the contract.

That meant that SPARK could spend up to a certain amount over budget in any line item – he thought it was a 5% variance. First, SPARK had overspent in the internship and entrepreneur-in-residence program. SPARK had also overspent the budget in the line items to cover expenses for administrative costs for the incubator facility at SPARK Central.

He reiterated that both of those variances were very minor, so he could report that – as SPARK has done historically – the agency is spending within its budget overall, as the last month of the fiscal year approached. The fiscal year ends on June 30.

SPARK as LDFA Contractor: Report from SPARK – Interns, Incubator

The report from the LDFA’s contractor was given by Skip Simms, Ann Arbor SPARK’s senior vice president for entrepreneurial services. Simms sits on the LDFA board in an ex officio, non-voting capacity.

Simms told the board that he did not have much report, beyond what the LDFA treasurer, Eric Jacobson, had just covered. Referring to the overspending on incubator expenses, Simms said that if they were going to overspend, that’s where they would want to be overspending. He explained that the CEO-in-residence program was a way to help retain executive talent – keeping CEOs in the community who might otherwise be inclined to leave the community and work someplace else. The CEO-in-residence program allowed someone to be retained and at the same time provide their experience and expertise to start-up companies in the community. The CEO-in-residence program, not the interns, had caused SPARK to exceed that line item.

The definition of interns was an issue that still needed to be resolved for next year, Simms said. The next cycle of interns would actually be employees of Ann Arbor SPARK, he explained. Simms pointed out that on a couple of other different line items, Ann Arbor SPARK was under budget. Money could be moved around so that it would be “a wash” when the board reviewed SPARK’s quarterly report next month.

Board chair Carrie Leahy asked about the occupancy of the SPARK Central business incubator [in the Michigan Square building adjacent to Liberty Plaza, at the corner of Division and Liberty]. Simms responded by saying that SPARK Central on the lower level had more than 90% occupancy. There was an opening for perhaps one additional company, and there were some companies in line for that space. The third floor of the incubator is filling up, he said. On the third floor, there is perhaps room for one additional company, he said.

The third floor space, Simms continued, is finally breaking even on rent compared to expenses, so he expressed some optimism about that. More importantly, Simms said, companies on the third floor are growing and expanding. As an example, he gave Seelio, which has been acquired. The company is staying in Ann Arbor, Simms reported, and they are probably going to add five more people by the end of the year. The company is going to be squeezed for space, he said, so he was not sure if they were planning to move. If they moved, there would be quite a few seats that would need to be filled in the third floor space, he said. There were some companies in line for that space, however.

Simms then described the incubator environment in the community as a whole as growing. There are a couple of new incubators in town, he said, and the space they’re offering seems to be getting absorbed quickly: As soon as space becomes available, start-ups and early-stage companies are moving in. That was a good indicator for the future, he concluded. It reinforced the need for the LDFA to continue to have the kind of facility that Ann Arbor SPARK has created at 330 E. Liberty, Simms concluded.

Leahy ventured that the newest incubator was associated with University of Michigan. Skip Simms indicated that the incubator to which Leahy was referring was still in the works. Ann Arbor SPARK is in dialogue with the university on that. One of the reasons that Ann Arbor SPARK in dialogue with the university about that incubator, he explained, is that SPARK wants to have a clear understanding of what the goals and objectives are of that new incubator, and what kind capacity they are planning for. Because it would be operated by the University of Michigan, access would be limited, Simms said: Some kind of university relationship will be required to use the incubator, which would eliminate about 60% of the market.

Still, Simms ventured that there could be a partnership opportunity there. One possibility is that companies that started in the university’s incubator could be handed off to SPARK as they got closer to commercialization. He was not sure how far the university was planning to take companies in their evolution toward commercialization.

Responding to a question from Leahy, Simms indicated that university’s incubator concept was for relatively early-stage companies. Leahy said she heard the university was planning to take a percentage of ownership of the companies. Simms thought that was still under discussion. They are looking at a model that does take equity, he said. The university is freer to take that approach than the LDFA is, Simms said.

SPARK as LDFA Contractor: FY 2015 Contract

Board chair Carrie Leahy explained that the LDFA board’s contract committee had reviewed the contract – after Ann Arbor SPARK had reviewed it and proposed updates. A revised draft had then been proposed by the contract committee. That draft was now in front of the LDFA board for its approval, she explained. [.pdf of LDFA-SPARK FY 2015 contract]

Leahy called everyone’s attention to a section that was enclosed in brackets and bolded:

[The reports shall include, as applicable, and only at such times as required, information required to be reported in connection with an extension of the LDFA's term.]

She felt that the bracketed sentence was intended to be included as part of the contract – so it was not meant to actually be in brackets and bold. She checked with Simms to see if it was okay to simply include it. She wasn’t sure if Ann Arbor SPARK had had a chance to comment on the added language. The point of the added language, she explained, was that if the LDFA was awarded an extended term, the required reporting would already be expressed in the contract. She felt that the reporting that was described in the added language was already being done, in any case.

The new contract, Leahy explained, includes updates to the specified years and budget numbers. Another update the contract covers is how the internship program will work, she said. Leahy explained the changes to the internship program. Interns that are being deployed to people now will actually be Ann Arbor SPARK employees, she said. The contract between the LDFA and SPARK is been updated to reflect that arrangement, which has been approved by the MEDC, she said.

Outcome: The LDFA board voted to approve the updated contract with Ann Arbor SPARK.

City of Ann Arbor as LDFA Contractor: Administrative Services

The LDFA does not employ a staff – so it contracts with the city of Ann Arbor for administrative support services. Those include items like the preparation of meeting minutes, stewardship of public documents, and preparation of budgetary analyses. [.pdf of FY 2015 LDFA contract with city of Ann Arbor]

When the board reached the item on its agenda, board chair Carrie Leahy ventured that under the first bullet point, under “services,” the intended word was likely not “secretariat” but rather “secretarial.” There was some lighthearted commentary to the effect that the language had been like that for about 10 years and no one had noticed. [The intended word was, in fact, likely "secretariat" – in the sense of an administrative office or department, especially a governmental one.]

Leahy checked with board treasurer Eric Jacobson that he was OK with the numbers that were included at the end of the contract, and he was. She characterized the contract as the same as in years past, covering administrative support by the city of Ann Arbor for the board of the LDFA.

Outcome: The board approved the administrative services contract with the city of Ann Arbor for support of the LDFA board.

LDFA Extension

At its June 2, 2014 meeting, the Ann Arbor city council had approved a resolution expressing city council support of the local development finance authority’s application to the Michigan Economic Development Corp. to extend the life of the tax capture arrangement for up to 15 years. The MEDC is described on its website as the “state’s marketing arm and lead advocate for business development, talent and jobs, tourism, film, and digital media incentives, arts and cultural grants, and overall economic growth.”

Without an extension, Ann Arbor’s LDFA would end in 2018.

Under a 2012 amendment to the state’s LDFA statute [Act 281 of 1986], the MEDC is empowered to approve extensions of LDFAs for 5 or 15 years. Both extension options would require a greater explicit commitment to greater regional collaboration. But the 15-year option requires the creation of an additional “satellite” geographic area for tax capture:

In addition, upon approval of the state treasurer and the president of the Michigan economic development corporation, if a municipality that has created a certified technology park that has entered into an agreement with another authority that does not contain a certified technology park to designate a distinct geographic area under section 12b, that authority that has created the certified technology park and the associated distinct geographic area may both capture under this sub-subparagraph for an additional period of 15 years as determined by the state treasurer and the president of the Michigan economic development corporation.

The council’s resolution approved on June 2 stated that if the MEDC approves the extension, the city of Ann Arbor will work with the LDFA and the city of Ypsilanti to identify another LDFA – called the “Satellite SmartZone LDFA.” The arrangement will allow the satellite SmartZone LDFA to capture local taxes in its own distinct geographic area for the maximum 15 years allowed by statute.

What is it that would be extended? Ann Arbor’s local development finance authority is funded through a tax increment finance (TIF) district, as a “certified technology park” described under Act 281 of 1986. The MEDC solicited proposals for that designation back in 2000. The Ann Arbor/Ypsilanti “technology park” is one of about a dozen across the state of Michigan, which are branded by the MEDC as “SmartZones.”

The geography of the LDFA’s TIF district – in which taxes are captured from another taxing jurisdiction – is the union of the TIF districts for the Ann Arbor and the Ypsilanti downtown development authorities (DDAs). It’s worth noting that the Ypsilanti portion of the LDFA’s TIF district does not generate any actual tax capture.

In FY 2013, the total amount captured by the Ann Arbor SmartZone LDFA was $1,546,577, and the current fiscal year forecast is for $2,017,835. About the same amount is forecast for FY 2015.

The LDFA captures Ann Arbor Public Schools (AAPS) operating millage, but those captured taxes don’t directly diminish the local school’s budget. That’s because in Michigan, local schools levy a millage, but the proceeds are not used directly by local districts. Rather, proceeds are first forwarded to the state of Michigan’s School Aid Fund, for redistribution among school districts statewide. That redistribution is based on a per-pupil formula as determined on a specified “count day.” And the state reimburses the School Aid Fund for the taxes captured by some SmartZones in the state.

However, the school taxes captured by the Ann Arbor SmartZone are not required to be reimbursed to the state School Aid Fund – which diminishes the amount of funding for public schools statewide. That’s a conclusion based on a reading of the LDFA statute and confirmed to The Chronicle by communications staff in the Dept. of Treasury and the MEDC.

According to the Dept. of Treasury, the Ann Arbor SmartZone LDFA was designated under subsection (8). From the LDFA statute [emphasis added]:

(13) Not including certified technology parks designated under subsection (8), but for certified technology parks designated under subsections (9) and (10) only, this state shall do all of the following: (a) Reimburse intermediate school districts each year for all tax revenue lost that was captured by an authority for a certified technology park designated by the Michigan economic development corporation after October 3, 2002.
(b) Reimburse local school districts each year for all tax revenue lost that was captured by an authority for a certified technology park designated by the Michigan economic development corporation after October 3, 2002.
(c) Reimburse the school aid fund from funds other than those appropriated in section 11 of the state school aid act of 1979, 1979 PA 94, MCL 388.1611, for an amount equal to the reimbursement calculations under subdivisions (a) and (b) and for all revenue lost that was captured by an authority for a certified technology park designated by the Michigan economic development corporation after October 3, 2002. Foundation allowances calculated under section 20 of the state school aid act of 1979, 1979 PA 94, MCL 388.1620, shall not be reduced as a result of tax revenue lost that was captured by an authority for a certified technology park designated by the Michigan economic development corporation under subsection (9) or (10) after October 3, 2002.

A 15-year extension is possible, according to the staff memo accompanying the June 2 city council resolution, “if, in addition to the above requirements, Ann Arbor and Ypsilanti, as the municipalities that created the SmartZone, enter into an agreement with another LDFA [a "Satellite SmartZone"] that did not contain a certified technology park to designate a distinct geographic area, as allowed under Section 12b of the Act…”

A key requirement for an LDFA SmartZone is “significant support from an institution of higher education, a private research-based institute, or a large, private corporate research and development center.” So the possibilities for an LDFA satellite for Ann Arbor’s SmartZone include not just a governmental unit, but also an institution of higher learning.

Currently under consideration for the satellite LDFA are Adrian (Adrian College) or Brighton and Livingston County (with Cleary University). The June 17 LDFA meeting included an update on where Adrian and Brighton are in the process – as they are competing to be the partner designated by the Ann Arbor LDFA.

Only one of the two communities would partner with the Ann Arbor LDFA SmartZone.

LDFA Extension: Board Discussion

Skip Simms of Ann Arbor SPARK gave an update on the status of other communities that are candidates for the satellite LDFA that would be required for the Ann Arbor/Ypsilanti SmartZone to receive an extension. Right now SPARK is talking to both Brighton and Adrian. Brighton would be a Brighton-Howell satellite. Adrian could turn out to be an Adrian-Tecumseh satellite, he said.

Both communities are rapidly moving forward to complete required tasks as communities and LDFAs to comply as satellites. Flint is off the table – because Flint took themselves off the table, he said, and made it clear that they were not interested. Both Adrian and Brighton are on a fast-track to try to beat each other to meet all the compliance for a satellite. Simms invited Ann Arbor SPARK’s Luke Bonner to walk the board through the details of what those communities need to do.

Bonner told the board that the city of Adrian had gone through the first step of the process to create an LDFA – which was that the city council approved a resolution expressing the intent to create an LDFA and set out the district boundaries. They are moving toward the first public hearing. Adrian should have its final approvals done, he believed, by the first week in September. So this would be a new LDFA, where the city of Adrian would be the lead governmental unit. Tecumseh is going to come in as a partner to Adrian after the LDFA is created, Bonner explained.

In the case of Brighton and Howell, Brighton already has an LDFA, so their approvals are pretty simple. They don’t have to go through the time-consuming process of creating the authority itself. Howell has an LDFA that was never actually kicked off – they don’t have board members or a district. It was just approved and left in limbo, he said. So Howell is going to wait until the process is completed in Brighton and then Howell will put its LDFA together for the sole purpose of being a partner to Brighton and of overseeing the school funds to run the incubator and accelerator program.

In both cases, Bonner said, the communities have an educational institution as a partner. Adrian is working with Adrian College, which has established a business incubator program. They have built a facility and dedicated funds, and personnel are working on that program. In Livingston County, in Brighton, Cleary University is the educational institutional partner. Cleary University has an existing business incubator program that they are continuing to scale up, Bonner explained. So there are university partners in both communities.

Board chair Carrie Leahy asked how the process that Brighton and Adrian are undergoing would integrate into the timing of the Ann Arbor/Ypsilanti SmartZone LDFA extension application. In the case of Adrian, Bonner explained, they will make sure that the very first LDFA board meeting happens immediately following the establishment of the authority. The satellite LDFA has to approve the contract with the host LDFA. So the first order of business for the LDFA in Adrian will be to approve its bylaws and then move right into the approval of the agreement. That should be done by the first week in September, he said.

In the case of Brighton, they are looking at doing some informational sessions with the LDFA and the city council in July. And they look to be taking action sometime at the end of August. So the two candidate satellite LDFAs will be completing their work in roughly the same two-week timeframe.

Bonner explained that Brighton has a couple of other issues with its LDFA because it is “underwater” – as its tax capture is not at the point where it can cover debt service. It falls short by about $5,000-$6,000 annually, he said. That issue will have to be addressed, he said. They’re waiting to see what happens with the personal property tax law in the August election. That will also affect how Brighton does business with its LDFA. Leahy ventured that there could be a situation where both communities form an LDFA. Yes, Bonner confirmed.

Leahy invited attorney Jerry Lax to walk the board through the Ann Arbor/Ypsilanti SmartZone LDFA’s next steps. She knew there was a two-page summary that needed to be submitted to the MEDC. She asked Lax what else needed to be submitted.

Lax told Leahy that the only thing that needed to be submitted to the MEDC promptly by June 30 was the two-page summary. The MEDC guidelines provide that the two-page summary be emailed by June 30. That two-page summary has already been drafted, he said. Leahy told Lax she was not sure if board resolutions needed to be attached to the state summary. The guidelines don’t say so, Lax replied.

Lax continued by noting that the two city councils (Ann Arbor and Ypsilanti) have already passed resolutions supporting a 5-year extension and supporting the contemplation of creating satellites in anticipation of a potential 15-year extension. But with regard to the 5-year extension, the next thing that has to be done is for the cities to amend the existing TIF plan to accommodate a higher degree of regional cooperation. And both city councils have passed resolutions committing to engage in those discussions, he said.

The requirement is that by March of 2015, the amended TIF plan be available for submission to the MEDC, Lax explained. So the first step is just submitting a two-page summary – and everything is all set to do that, he said. And hopefully, once the LDFA is notified that the MEDC has approved the proposed 5-year extension, the next step for the 5-year extension would be the amendment of the TIF plan, he said.

Lax reported that he has communicated with Mary Fales of the Ann Arbor city attorney’s office and also John Barr, who is the city of Ypsilanti attorney – and both of them are on board with jumping into the process and meeting promptly and dealing with potential amendments to the TIF plan. Both of the city councils will have to attend to those details.

Leahy asked Lax what he meant by “attending to the details.” She asked, “What are we proposing to amend in the TIF plan?”

Lax called that a policy question for the city councils. He did not know how much attention the councils had given to the details of what exactly would need to be amended. Tom Crawford, the city of Ann Arbor’s CFO, ventured that procedurally it would be appropriate for the LDFA board to make a recommendation to the city council and then for the council to consider it. Based on his conversations with Fales and with Lax, Crawford felt that the next step would be for the LDFA to articulate changes, by providing a document with tracked changes that the councils would vote on.

Lax agreed with Crawford that it was entirely appropriate for the initial proposal to come from the LDFA board. But then it would need to be discussed by both councils – because it would involve amendments that the councils need to approve. Leahy got clarification from Lax that the TIF plan and the development plan were combined as one document.

Some back-and-forth unfolded about whether an MS Word copy of the TIF plan still existed. Leahy ventured that it could be scanned in and then cleaned up, prompting Skip Simms to observe that Adobe had improved. Steve Rapundalo said he thought he might have some old documents. Leahy ventured that probably the first order of business was to just get their hands on a copy of the old MS Word document.

A question was raised by an LDFA board member about whether the board needed to wait until the MEDC approved the two-page summary before working on amendments to the TIF plan. Lax ventured that if the MEDC did not approve the two-page summary, then any effort the LDFA board put into revising the TIF plan would be wasted.

But on the other hand, even though it looks like March 2015 is a long way off, he thought it made a lot of sense to give prompt attention to amending the TIF plan. He did not know how soon they could expect the MEDC to approve the two-page summary. Leahy wanted to know if Lax knew of any guidelines the MEDC had provided for the kind of amendments to the TIF plan that they would be looking for.

Lax said he was not aware of any additional guidelines beyond the guidelines in the statute that talk about a higher degree of regional collaboration. Even for just a 5-year extension, this higher degree of regional collaboration is something the MEDC is looking for, he said. Leahy asked Skip Simms if there was anything he recalled from his discussions with the MEDC by way of guidelines. Simms said the key point that the MEDC is looking for had been described by Lax – broader regional collaboration.

The other thing the MEDC has said, Simms added, is that this is an opportunity for the LDFA to make changes to elements of the TIF plan that might have been too restrictive. It would be an opportunity to look at the TIF plan and the development plan with a clean slate and change anything and everything that they would like to see changed, he said. You can start with the core document if you’re happy with most of it, he allowed, but this is the opportunity to make changes.

Once the TIF plan has been changed, it’s unlikely that it would be changed again for another 15 years, Simms ventured. So now would be a good time to take the opportunity to insert everything that they wanted to put into a new TIF plan that might have been missed 15 years ago, he concluded.

Rapundalo suggested that the LDFA board, or a subgroup of the board, go through the TIF plan line-by-line from a conceptual viewpoint and ask about everything that’s included: Is this still valid today? If it is, then leave it in – if not, then take it out and perhaps replace it with something else.

A consensus that seemed to evolve from the board discussion was that the LDFA board’s contract committee would be a suitable group to take up the task of reviewing the TIF plan. Leahy said the issue of infrastructure would be a good topic to review in the TIF plan – because the Ann Arbor city council is suggesting it would like to see infrastructure projects undertaken, but there are certain kinds of infrastructure projects that the LDFA cannot undertake, because they are not in the plan.

Rapundalo suggested it would be useful to collect some best practices from other SmartZones in the state as well as other communities with high-tech concentrations, and try to incorporate some of that into the new plan. Leahy asked Lax if he could inquire with Roslyn Zator at the MEDC to get some direction about what the MEDC would like to see in the TIF plan amendments. Leahy also asked Skip Simms which other SmartZones he thought would be good to look at, as far as best practices – Traverse City, Houghton, Grand Rapids?

Simms said that what he heard from everyone else is that they are modeling everything after Ann Arbor SPARK. Nobody is saying they are doing it better than Ann Arbor SPARK is doing it, he said. Nonetheless, Simms allowed, it would still be important to reach out.

Simms said that Grand Rapids was undergoing a revision, so it would be good to contact Grand Rapids. Rapundalo agreed with Simms’ point about Grand Rapids, saying that Grand Rapids is making changes to their SmartZone that would set them apart structurally from other SmartZones. He thought it would be important to take a look at that and see why Grand Rapids is making those changes.

Simms pointed out that Grand Rapids is also considering applying for a 15-year extension of its LDFA. In terms of out-of-state organizations, Simms suggested taking a look at TechColumbus. Leahy asked Simms to see if he could get a copy of the TechColumbus development plan.

Lax circled back to the idea that the LDFA board should make the first proposal to the city councils about the needed changes to the TIF plan. But he also pointed out that the Ann Arbor city council had expressed interest in seeing greater attention paid to issues like infrastructure. He suggested that the LDFA take into account anything the councils might be interested in seeing at the outset. That way, whatever is ultimately proposed would stand a greater likelihood of being approved by the city councils.

At that point, Lax noted that March 2015 seems like a long way off, but given the potential complexity, it creeps up rather quickly. So the discussion should take place sooner rather than later. He suggested getting some clarity about what people may think they want to know, and what topics they have not known enough about up until now. That would help focus the discussion on what information is available, he said.

Although there are different timelines for requirements to apply for a 5-year extension of the LDFA compared to a 15-year extension, the consensus that evolved at the June 17 LDFA board discussion was that they should be handled pretty much simultaneously. Lax pointed out that the 15-year plan would involve a satellite and there would be some coordination among the various municipalities involved, but some room could be left in the 5-year plan extension to accommodate the addition of a satellite LDFA. Jacobson ventured the right approach would be to redline an amended TIF plan for both a 5-year plan and the 15-year plan.

Bonner suggested that everything be done, based on the idea of a 15-year agreement, with language incorporated into the documents to include satellite LDFAs. Then, if it turns out that only the 5-year extension is approved, the additional language due to the 15-year plan can simply be eliminated through an administrative amendment. The idea would be that it would be convertible to a 5-year plan in relatively short order. Lax agreed that much of the content would be the same in either case – 5-year plan compared to 15-year plan. Lax reiterated that he felt it made sense to think of it all as a unified project.

Crawford pointed out that after an amendment is prepared, you have to go through a process of notifications and public hearings – and it was undesirable to have the document change significantly during that process. Lax suggested that the 15-year component of the plan could be separated out as an “add on.”

Jacobson ventured that they need to think it through so that they have two different versions in their back pocket – that can be pulled out, based on what the MEDC approves. Lax also suggested having prompt discussions with the MEDC about other plans that could be used a model. The MEDC might have some guidance about how complex the amendments to the TIF plan might be, related to a 5-year extension, if a community is also contemplating a 15-year extension.

Simms pointed out that the MEDC review would happen after the council action. Lax allowed that was true, but ventured that the MEDC might have something useful to say in advance of that.

The question was raised about whether Houghton had pursued both types of extension simultaneously – but Simms thought that Houghton had pursued a 15-year extension from the get-go. Simms was not sure if everything had been completed in Houghton, but things have been completed in Marquette, which is supposed to be the satellite. He thought that the current status of that 15-year extension was: Discussions are taking place about the agreement between the satellite LDFA, the host LDFA and the MEDC. He pointed out that that was a whole additional agreement that would need to be amended and addressed.

About the timing, Simms said here’s what “your contractor [Ann Arbor SPARK] is prepared to do: We are prepared to have this dialogue with the LDFA relative to the amendments and changes to the TIF/development plan through the summer.” In September 2014, it will be known whether Brighton or Adrian or both are “real.” And they will know by Sept. 30 whether there’s a legitimate 15-year proposal to submit to the MEDC.

At that point, everything could already be in place for either the 5-year extension or the 15-year extension. Then in early October, “Bang, we go forward with either the 5-year plan or 15-year plan, because it will be clear which one it is,” Simms said. By the end of October, there could be a proposal to give to the two city councils for approval.

Jacobson ventured that it would also be clear from the state at that point which option could move forward – the 5-year or the 15-year option. Lax asked Simms if he knew when the MEDC was likely to give a reaction to the two-page executive summary, as related to a 5-year extension. No, Simms told Lax. But as a point of reference, Simms said the MEDC had responded to Houghton’s application very quickly.

Given the relationship between Ann Arbor and the MEDC historically, Simms had no doubt that MEDC would respond quickly. [The MEDC's current CEO, Michael Finney, is the former CEO of Ann Arbor SPARK.] The MEDC recognizes the importance to all parties – including the MEDC – to making this happen as quickly as possible for everybody, he said. So he was confident that the MEDC would respond rapidly. Leahy said she could get the two-page executive summary submitted that very day when she returned to her office.

Jacobson asked if Simms was suggesting that the contract committee wait until September or October to start reviewing the TIF plan amendments. Not at all, Simms replied. Simms thought the LDFA board’s contract committee ought to meet within the next three weeks and begin this process – because the majority of it is relevant, whether it is a 5- or 15-year extension.

Jacobson asked a question on the 15-year extension, which related to some feedback he thought the MEDC had given to the Ann Arbor/Ypsilanti SmartZone LDFA. At one point the MEDC had given the Ann Arbor/Ypsilanti SmartZone feedback, he thought, that in order to include a satellite that is subsidized by a third-party like a university, the MEDC would expect Ann Arbor to funnel 10% of the expenditures to Ypsilanti. He thought that had been presented as an idea by the MEDC, he said. Is that a requirement that should be considered when the LDFA prepares the 15-year application? Jacobson asked.

Simms said it was something that needed to be looked at and discussed, adding that the LDFA probably needed to go back to the MEDC to get some definitive language.

The idea of funneling money to Ypsilanti had come up in a discussion between the two CEOs – Ann Arbor SPARK CEO Paul Krutko and MEDC CEO Michael Finney, Simms said. Whether that would be a firm position or not has not been clarified. Jacobson wondered if that would be clarified before a 15-year proposal would be submitted. Yes, Simms said, that will be clear. The other thing that MEDC is pushing is the idea of collaboration.

Ypsilanti has been in the Ann Arbor/Ypsilanti SmartZone all along, Simms said, but “Ypsilanti has gotten squat.” Collaboration would mean that it’s a way to get something, he said. What the LDFA has been providing needs to extend outside the city limits, Simms said. So that needs to be considered in thinking about the modified development plan, he said.

The overwhelming benefit at the end of the day, Simms continued, is a significant sum of money that is coming to benefit the city of Ann Arbor that would not be coming at all – not a dime of it – if the LDFA did not get the 15-year extension. The benefit to the city is still enormous, Simms said. So to extend a little bit of that to Ypsilanti seems like a reasonable action, he concluded.

Leahy came back to the point that the next step is to submit the two-page executive summary to the MEDC. She told her board colleagues that she would submit that to Roslyn Zator. The next steps would be for city of Ann Arbor financial services staffer Ken Bogan and Ann Arbor SPARK – as well as Stephen Rapundalo – to look for the MS Word version of the TIF/development plan.

In the next three weeks, the contract committee would schedule a meeting to start going over the changes to the TIF/development plan that they think are appropriate to take to the city councils. Bonner ventured that the satellite LDFA communities might need some support as they go through their process – and he thought it might be appropriate for the LDFA to provide that support in the form of legal counsel from Jerry Lax. That way they could make sure that the resolutions and the agreements are in line with what the Ann Arbor city council would want to see.

The contract committee set a meeting for Tuesday, July 8 to start going over the TIF plan.

Politics of an Extension

The LDFA board’s June 17 discussion included acknowledgment that an extension of the LDFA’s term would likely need to satisfy recent concerns expressed by the Ann Arbor city council:  (1) investments in high-speed fiber telecommunications; (2) audit of jobs creation figures; and (3) clarification of school tax capture by the LDFA.

Politics of an Extension: Jobs Audit

Based on LDFA board chair Carrie Leahy’s conversations with Paula Sorrell, the MEDC ex-officio representative on the LDFA board, and some email exchanges with Rosalyn Zator, it does not look like any other SmartZones are doing audits of job creation numbers. Sorrell said the MEDC would be looking specifically at its grant to SPARK– and not all of Ann Arbor SPARK – just those things that are associated specifically with the grant.

Sorrell explained that there are process audits and financial audits – and they take place every 2 to 3 years. Those are audited by the state, she said. As far as job creation numbers go, those are collected monthly, she said, and those are specific to grants. Spot-checking is done on those numbers as well.

Stephen Rapundalo asked Sorrell to describe how the spot-checking was undertaken. He ventured that all of the numbers are essentially self-reported by the companies. So are you randomly calling companies and saying, “Hey, you said this,” and verifying the numbers? Is that how it works? he asked.

Sorrell told Rapundalo that in a start-up tech company, it would be typical to see a few jobs added at a time. Eventually the only thing that can be done is to just work down the list of all the companies that had been served and to verify whether the numbers that had been quoted were in fact accurate or not. Sorrell said the MEDC also gets reporting from multiple areas, and most of the companies use three or four other grantees at a time, so they can check to see if anybody is reporting different numbers.

Petersen also noted that the previous evening’s council meeting had included quite a bit of discussion about the appropriate metrics – in terms of return on investment. The question had arisen with respect to projected job creation as opposed to actual job creation, she noted.

Tom Crawford, Ann Arbor’s CFO, said he’d heard some the comments about projected versus actual jobs created and he was not sure exactly how that applies. When a company comes in, they are not necessarily incentivized to give you a number that they would overshoot. The system is designed so that they give you a higher number. That’s not a detriment to the entity that is providing the incentive, Crawford said, because the incentive is based on the actual jobs that are provided. He wasn’t sure that everyone understood that point. Historically the state has paid grants based on actual jobs. Companies were only paid tax credits for actual jobs, he said.

For SPARK’s business development team, Luke Bonner said, its metrics for counting jobs are based on what the company says it will do in a public announcement – based on a tax abatement application, or a state grant they are receiving. And those numbers are what are included in Ann Arbor SPARK’s successes annually, Bonner explained.

For example, the company says that they are investing $2 million and creating 75 jobs in Ann Arbor, and that goes into SPARK’s annual report for successes, he said. SPARK continues to meet with that company over time. However, SPARK does not have to track what that company does over time, because they are not committed to SPARK to report anything. If it is a tax abatement, it’s part of the letter of agreement that you can go back and ask them how many jobs they have created. Or if it’s a state grant, the company has to report the actual jobs that they create to the state.

What SPARK’s business development team has been doing that is a little different now, however, is starting to look at the number of jobs a company has created this year as opposed to last year, Bonner said. That allows the business development team to start to measure the health of the local economy. So if a company adds 100 jobs last year and 200 this year, SPARK want to be able to show that difference.

But the LDFA uses really different metrics, Bonner said. LDFA metrics are those from the SPARK entrepreneurial services team. Those are two different areas, he stressed.

Sally Petersen, the city council’s representative on the LDFA, ventured that the council would like to see metrics that show projected versus actual jobs created. Bonner told Petersen that the LDFA should work with Skip Simms and Bill Mayer to look at the programs they’re running, and to figure out the best metrics to report that would satisfy the MEDC, the LDFA board and the city council.

Crawford added that projected jobs numbers are typically associated with incentive-based financial support – which is not what the LDFA board deals with. Stephen Rapundalo pointed out that the LDFA board’s own metrics committee had reviewed the kind of metrics that SPARK reports – and SPARK is already required to report a great deal of information to the MEDC.

Bonner went on to explain that internal to SPARK, they use a different nomenclature to talk about “retained jobs.” The entrepreneurial services team will say that “retained jobs” mean one thing, whereas for the business development team, “retained jobs” mean something else. For the business development team, Bonner continued, if a company says they’re going to move out of this state with their 100 employees and add another 200 employees elsewhere, and through the efforts of SPARK the company were to actually stay, the business development team would characterize that as 100 jobs retained – if not for the effort of the community and the state.

But for the entrepreneurial services team, when a company comes to SPARK, with, say, two employees, then that is their baseline – two retained jobs for when SPARK entrepreneurial services started to work with the company. Mayer added that he refers to the “retained jobs” in entrepreneurial services as a “snapshot” of the growth curve of a start-up. At a moment in time when SPARK “touches” the company, they say the retained number of jobs was three. And then six months later the retained number of jobs is four. That equates to one job created, Mayer concluded.

Board chair Carrie Leahy noted that the  issue of an independent jobs audit had been brought up in multiple city council meetings. Petersen said that a lot of the “noise that is out there” has to do with accountability. Putting aside accusations about whether SPARK is or is not inflating job creation statistics, it’s important to focus on the interest in accountability, she said.

If Ann Arbor were to be the first SmartZone in Michigan to do an independent audit, that would reflect positively on Ann Arbor, Petersen said. That would show that the Ann Arbor/Ypsilanti SmartZone is not afraid of being accountable, she added. The components of such an audit are still unknown, because no one else has done it before, she said. So she felt it was important for the LDFA board to pursue that direction with an intention to do such an audit.

Eric Jacobson asked if Petersen was talking about an audit of metrics or a financial audit of the dollars. Petersen explained that the interest was an audit of the job creation numbers. Stephen Rapundalo ventured that such an audit would have financial implications. How much would it cost? In addition, was the LDFA also planning to do a financial audit?

Jacobson explained that the financial audit is to be done about every two years and usually in the fall. He then explained that a financial audit of the LDFA is done every year in conjunction with the city of Ann Arbor’s audit. Another kind of audit is an audit of the LDFA’s contract with SPARK – which is an audit on contract compliance.

Jacobson said that the firm that had done the financial audit last time had done a great job from his perspective, so he would like to use the same firm again – Abraham & Gaffney. It would be an audit by the LDFA of Ann Arbor SPARK, using a third-party, to go through and check all the LDFA dollars that are going to SPARK, to check to make sure none of the funds had been misappropriated according to the terms of the contract, he explained.

Rapundalo suggested that the scope of the financial audit could be expanded to include the jobs numbers. Leahy asked if an inquiry could be made with Abraham & Gaffney to see how they would propose to check those numbers. Petersen asked if Abraham & Gaffney could be used just because they had done the audit previously – and wondered if they needed to use a bid process and accept the lowest responsible bid.

Jacobson told Petersen that Tom Crawford, the city of Ann Arbor’s CFO, was checking into that issue. Some back-and-forth between Petersen, Leahy and Jacobson led to a tentative consensus that the auditor would be asked to develop a proposal.

But SPARK’s Simms expressed some skepticism: “Wait, wait, wait!” Earlier in the meeting, Bonner had done a nice job of explaining that the job numbers that are projected come from SPARK’s business development team, Simms said. Entrepreneurial services has never provided the LDFA or anybody else “projected” jobs, Simms added. [The LDFA-SPARK contract approved by the LDFA board at the June 17 meeting includes a requirement for reporting to the LDFA "projected new employees" for Phase IV companies: "These reports shall include but not be limited to the following ... 4) the companies that receive Phase IV assistance, description of assistance, number of full time equivalent employees and projected new employees."]

Rapundalo told Simms that they were talking about the metrics that SPARK’s entrepreneurial services team does currently report, which includes jobs created and jobs retained. Petersen explained that this audit was not focused on the city’s contract with SPARK for the business development services. Leahy said that what they were hearing from the city council is that the LDFA is just accepting what SPARK says with no verification.

Sally Petersen is the city council’s representative to the LDFA board.

Simms replied that there has in fact been an audit: “We somehow allowed the thought to occur that there has never been one.” Leahy told Simms that they reported to the city council that there had been a contract audit. But Simms told Leahy he was not sure the council had actually heard that.

So this won’t be the first audit, Simms concluded. Rapundalo felt the council had heard clearly that there had previously been a financial audit. Leahy said they had reported to the council that SPARK has undergone a financial audit, and they were clean and that the results of that audit have been posted.

Petersen wrapped up by reiterating the importance of doing an independent audit of the metrics. The LDFA needs to provide documentation, she said. She wanted an independent audit, even if that meant the Ann Arbor/Ypsilanti SmartZone was the first in Michigan to do it. Ann Arbor would be putting its best foot forward and saying: Here’s what an independent audit of job creation numbers actually looks like. The Ann Arbor/Ypsilanti SmartZone needs to focus on the accountability outcomes first, Petersen concluded.

Politics of an Extension: Infrastructure, City Fiber Initiative

With respect to infrastructure, Stephen Rapundalo asked if the MEDC could provide information about what other SmartZones and LDFAs had done in the way of investing in infrastructure. Paula Sorrell said she had put Carrie Leahy in touch with MEDC contacts. And by-and-large, there are not a lot of SmartZones that have undertaken infrastructure projects.

Leahy reported that so far she’d found the use of TIF for infrastructure on road improvements and sewer connections in Grand Rapids. In Grand Rapids, TIF had also been used for marketing in the SmartZone and for equipment and furniture – updates to their business incubator – which the Ann Arbor/Ypsilanti SmartZone already uses money for. Leahy ventured that furniture in incubators is not what the Ann Arbor city councilmembers mean when they talk about infrastructure. She also described a bridge project in Grand Rapids where there was a question about whether TIF funds were used – and it turned out that TIF funds were not used.

The Ann Arbor/Ypsilanti SmartZone development plan, Leahy continued, states that infrastructure such as roads and sewers and certain other infrastructure are already complete in the SmartZone. So if there were some kind of project like that, she ventured that the development plan would need to be changed.

The one kind of infrastructure project that keeps coming up, Leahy said, is high-speed fiber telecommunications. That seems to be the only type of infrastructure project that has been floated that is specifically addressed in the current development plan for the Ann Arbor/Ypsilanti SmartZone, she said. If that were something the LDFA wants to pursue, then it would not require altering the development plan, she said.

Leahy wondered who would initiate that kind of project. Is it the LDFA that says, We should put money toward fiber? Or does the Ann Arbor city council tell the LDFA to pursue it? “That’s a good question,” allowed Sally Petersen, who is the Ann Arbor city council’s representative to the LDFA board. Like Leahy, she wondered what the next step might be toward high-speed fiber. If it would be helpful for the city council to pass a resolution on the topic, Petersen said she would be willing to try to move that forward.

Tom Crawford is the city’s chief financial officer, and serves on the LDFA board in an ex officio capacity.

City of Ann Arbor CFO Tom Crawford told Petersen that the city staff was working on a proposal for high-speed fiber that would be brought forward. Asked what the timeframe for that project would be, Crawford said it would be some time during FY 2015. [That means before June 30, 2015.]

As for details about projected costs, Crawford told the board that it was a proposal that would be “worthy of this group.” Rapundalo recalled Ann Arbor’s ultimately unsuccessful Google Fiber initiative, toward which the LDFA board at the time had pledged $250,000.

Rapundalo wondered how the LDFA could reach out to the high-tech community to get input on what that community feels is lacking in terms of high-speed infrastructure. Crawford responded to Rapundalo by saying that he would look to Skip Simms specifically, or Ann Arbor SPARK generally to facilitate that inquiry. He ventured that Ann Arbor SPARK conducts that kind of inquiry as a matter of course.

But Simms told Crawford that Ann Arbor SPARK does not do that in a formal way – characterizing it more as an ad hoc approach. The main mechanism for that is through the business development team, Simms continued, through their conversations with the more mature technology companies about their needs. “So far, quite honestly, we’re not hearing any outcry that we need a bigger pipe,” Simms said.

What SPARK is hearing, Simms continued, is “I need job training. I need people with skill sets. I need office space downtown. Those are the things we’re hearing from those companies. They’re not saying … fiber.”

But Simms allowed that could change in five years. Video technology is requiring more capacity – more storage space. So maybe what is needed is more online technology facilities, as opposed to fiber – but who knows? Simms said. He added that it’s important to be careful going forward that the LDFA doesn’t lock itself in and limit itself. Whether the proposal comes from the city council or from Ann Arbor SPARK or from city staff, Simms urged that the approach be kept fairly broad that whatever unfolds 10 years from now – and no one knows what that might be – it can be accommodated.

Crawford agreed with Simms’ remarks. The existing tech companies, Crawford said, are currently very well served – because if you want very good high-speed service, you can just pay for it. What the city has been considering is a broader look that would not necessarily address the issues of technology companies, but that would be a real asset and attraction for new companies to come in and other kinds of companies to start up. So the city’s fiber initiative would not necessarily address the need that existing companies have.

Crawford characterized it not as “incremental” but rather as “supplemental.” It would not take away from anything that Ann Arbor SPARK is already doing, Crawford said. Petersen ventured that there would be some “positive externalities” that would come from the installation of high-speed fiber, which would benefit residents as well. So if this project were viewed as affecting “community prosperity,” it would also help start-ups. Petersen thought there were also a lot of existing, mature businesses and residents who would be helped as well.

Crawford responded to Petersen by saying that it’s somewhat of a chicken-and-egg problem. Without high-speed fiber, innovations are not occurring and we are falling behind worldwide on innovation in this kind of thing, Crawford said.

Responding to a question about whether the city’s high-speed telecommunications fiber project would extend to the neighborhoods or just to the downtown area, Crawford explained that the concept is to include the entire city. Eric Jacobson said that his “gut feeling” was that demand for high-speed fiber capacity from residents would be possibly more than the demand from businesses – just because at home, people are pulling down massive amounts of bandwidth for video programming and things like that.

For a business, there’s some of that, Jacobson added, but perhaps not as much as for residents. He works for a software company [Amplifinity] and all of his company’s bandwidth to the outside world is provided by its hosting facility. But for his company’s office space, the bandwidth requirements are more than met by commercial providers, he said.

Crawford responded by adding that the price point that Americans are paying for the service they get is high compared to international standards, and speeds are uneven for uploading compared to downloading. Improving bandwidth in both directions has the potential to change the way that people do business, Crawford said. It’s not just about adding bandwidth to the business that you have – it’s potentially changing the way you use bandwidth.

Leahy brought the conversation back to the concerns of the Ann Arbor city council.

Leahy told Jerry Lax that she understood the current TIF/development plan limited how TIF funds could be expended on infrastructure. She asked him to provide some additional background. Lax told her he wanted first to look at the TIF/development plan a little more closely, because he has not investigated it in detail. Whatever conclusions might be drawn about its current limitations, he said, the real question is: What would the LDFA board like it to see? The next question is whether there are concerns either in the enabling legislation or elsewhere that would make it difficult to have the TIF/development plan say what the LDFA board has concluded that it wants the plan to say.

Lax wanted some additional time to take a look at what the constraints are in the current TIF/development plan, and also the question of whether in general there might be some limitations on altering the TIF/development plan. Right now, Leahy said, the TIF/development plan says that the roads and sewers and lighting are complete and basically done in the Ann Arbor/Ypsilanti SmartZone district. The only real item that is addressed is high-speed telecommunications fiber.

Lax cautioned that even if that was an accurate statement at one point in time, it might no longer be accurate. Leahy thought that the enabling legislation does in fact permit infrastructure investments, pointing out the Grand Rapids had done it. Lax allowed that his recollection of that portion of the enabling legislation was that there is not a constraint, but he would like to take another look at that.

Luke Bonner then interjected, asking if he could be a “wet blanket” based on his experience. If you look at the local development finance authority legislation that was put together in the 1980s, it’s important to note that’s when things were terrible in Michigan, he said. An LDFA was a tax increment financing mechanism that allowed for reimbursements of infrastructure costs to spur certain kinds of investments – basically for manufacturing in high tech, engineering, and alternative energy, he said. And that is the only type of project that those TIF dollars could be used for – it was very specific.

Then came along the amendment to the LDFA legislation in 2000 that created SmartZones, Bonner said. What the state did was create a new kind of TIF that was a “certified technology park.” That basically meant that if you had an existing LDFA, or if you wanted to create one, you could apply to the state to have a certified technology park designation – and that certified technology park designation basically allows an LDFA to capture school taxes to support business incubation and acceleration services.

The deal that has been put together on almost all of the certified technology parks, Bonner continued, is that if the state is going to contribute funding, there has to be some kind of local contribution – a local match. So if an LDFA already existed, and the LDFA had debt obligations – because it had built roads and bridges and sewer pipes – then the state treasury considered that to be the local commitment: Your local taxes are being used to create local economic development, and so you are allowed to capture school taxes, Bonner said.

In the case of Ann Arbor, there was a downtown development authority (DDA) district that was already established and that was already investing money. The infrastructure in which the Ann Arbor LDFA could invest could serve an incubator or an accelerator program. For example, an incubator could be built and you could run high-speed telecommunications fiber to that incubator. You could, under the enabling legislation [even if not under the Ann Arbor LDFA TIF/development plan] build a road or a sewer connecting to the incubator.

Where the challenge comes is trying to use school millage capture to build out general infrastructure that is not tied to an incubator. Bonner reported that the city of Rochester Hills was actually refused by the Michigan Dept. of Treasury, when the city wanted to use school taxes to help build out local infrastructure. The treasury had said: No way, you have to use the DDA, or a [non-SmartZone] LDFA to do that. The school millage can be used by a SmartZone LDFA to do infrastructure improvements – just as long as it is for an incubator, Bonner contended.

Leahy ventured that the restriction was not that specific and that it could be for infrastructure improvements anywhere in the SmartZone district. That’s what Grand Rapids had done, she thought. Bonner questioned whether what had happened to Grand Rapids was infrastructure improvements through a SmartZone LDFA or through an already-established LDFA.

Stephen Rapundalo said he knew some of the background of the situation in Grand Rapids and characterized the interpretation of the statutory language in that case as “rather liberal.” Grand Rapids had somehow got away with something, Rapundalo said. He told Bonner that he was on the right track in describing how things were supposed to function according to the statute. How Grand Rapids had done what they did, Rapundalo had no idea. Bonner pointed out that Ann Arbor’s LDFA is set up only to manage the use of the school taxes.

The LDFA in Ann Arbor is not set up in the original sense of the LDFA Act passed by the state legislature in the 1980s – which was to set up a mechanism to fund infrastructure improvements to attract manufacturing high-tech and engineering companies. But what Ann Arbor does have is a DDA that can make those improvements as well, Bonner pointed out. He had never looked at the Ann Arbor DDA plan before, but he knew that the DDA built parking decks and made road improvements.

The DDA has a lot of flexibility to make infrastructure improvements within the district, he said – whether it’s high-speed fiber or parking decks or roads or sewers. He noted that the geographic area of the LDFA and the DDA in Ann Arbor are the same district. He suggested again that it would be a good idea to develop an LDFA 101 presentation for the city council to explain how all these entities are very separate and distinct from one another.

Lax pointed out that one question is how the existing enabling legislation is interpreted. He also pointed out that legislation can be changed – although he would not want to suggest that as anyone’s first line of attack – because that is a “forever project.” Leahy ventured that right now the plan does not allow for the funding of the kind of infrastructure projects that the city council is interested in. Bonner thought that the state treasury would challenge an attempt to use LDFA school millage capture to run fiber to the premises in Ann Arbor citywide.

Politics of an Extension: School Tax Capture

Earlier in the meeting, Skip Simms had argued for a 15-year extension. He said if the LDFA did not get the extension, a significant sum of money would not be coming to benefit the city of Ann Arbor.

Stephen Rapundalo is a former city councilmember who serves on the LDFA board.

Sally Petersen picked up on Simms’ observation about the source of funds and the reimbursement from the state. One of the issues that the city council is concerned about, Petersen said, is whether the TIF capture from the Ann Arbor/Ypsilanti SmartZone is coming from the state school aid fund. “That’s still out there,” she said.

Stephen Rapundalo responded to Petersen by asking: “What’s it take – for them to understand unambiguously how that works? I mean we have told them. Why is the onus on the LDFA to have to show them that?” The LDFA has nothing to do with that aspect of funding, Rapundalo continued, saying that all the LDFA knows and understands is how the calculation is made, and therefore how much money is allocated to the LDFA board for the purposes stated in all of the various agreements. [See above for statutory interpretation indicating that the school aid fund is not reimbursed for the Ann Arbor/Ypsilanti LDFA SmartZone tax capture.]

Luke Bonner of Ann Arbor SPARK suggested that it is a lot to ask of current Ann Arbor city councilmembers, who were not around when the LDFA was created, to have a clear understanding. He suggested that the material needed to be broken down into a kind of LDFA 101 presentation.

Rapundalo expressed frustration – because such presentations have been given over the years, which he thought were really dumbed-down. Jerry Lax quipped that maybe they needed better diagrams. Rapundalo ventured that with respect to the school aid fund reimbursement, the council needed to hear from someone at the state level. He did not know who that person might be, but it could be somebody at the highest level of the MEDC, or the Dept. of Education – but it should not be from the LDFA.

Bonner suggested that it might be someone at the Dept. of Treasury – because the treasury department, more so than the MEDC, has to put their stamp of approval on the TIF plan. The state treasury is responsible for taking the money and reimbursing the school aid fund.

Rapundalo said he would ask Ann Arbor SPARK to identify the person who could explain that. “That needs to be cleared up, as much as we can, once and for all,” Rapundalo said. Lax added that many of the issues that city councilmembers might have concerns about are based on the actions of the state legislature in creating the statutory scheme in the first place. So if people have questions about it, they might very well be legitimate questions that need to be addressed – but the fundamental point is that for better or for worse, this is what the state legislature determined would be the mechanism.

If people have questions or doubts or criticism about how reimbursements are made, and where it comes from, and what bucket the money is taken out of, that’s not something that the city council determined or that the LDFA determined, Lax said. That’s something that the state legislature determined in adopting the state legislation in the first place.

Petersen said there are two things that concerned her about how the city council received this kind of information. The council might decide that they don’t like the mechanism at the state level, and to prove that point, the council might not want to support a 15-year extension of the LDFA. There are also remaining questions about whether the city of Ann Arbor public schools are actually getting reimbursed. She understood that representative Jeff Irwin had done some analysis of that, but she was not sure what it was, as she had just heard about it.

Lax ventured that maybe councilmembers feel that the schools ought to be getting more money – but the question of whether the schools are getting more money is a separate question from whether the way the schools are being reimbursed is fair. If the schools in general are getting a dollar-for-dollar equivalent for the captured taxes, then “so far so good,” Lax said.

Petersen stated that city CFO Tom Crawford has stood up and stated that the schools are getting reimbursed. Rapundalo observed that Crawford’s statement does not satisfy some councilmembers, and that’s why they need to hear from somebody who can walk them through the calculations and the whole process at the state level.

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The abbreviated discussion was the result of the fact that a motion to table – as contrasted to a motion to postpone to a date certain – is not debatable. So once the motion was made, the council immediately voted. The motion to table was made by Eaton, who said it could be taken up off the table at a future meeting when SPARK’s job retention, attraction and creation numbers could be reconciled.

Paul Krutko, CEO of Ann Arbor SPARK, stayed at the meeting until the rest of the council’s business was finished, which was around midnight. He was then invited to the podium to answer questions, and the ensuing debated by councilmembers lasted about 30 minutes. They did not reconsider their earlier vote to table the funding, however.

At its May 19, 2014 meeting, the council spent roughly five hours of deliberations on amendments to the FY 2015 budget, and just under 30% of that time was spent on two amendments involving SPARK – neither of which were approved by the council.

Ann Arbor city council budget deliberations FY 2015: 4 hours 45 minutes by amendment topic.

SPARK is also the entity with which the local development finance authority (LDFA) contracts for business accelerator services. One of the proposed amendments to the FY 2015 budget would have decreased the amount of funding to SPARK from the LDFA, resulting in an increase to the amount the LDFA would have reserved for future infrastructure projects. The second budget amendment debated on May 19 would have eliminated $75,000 in the FY 2015 budget for the contract that the council was asked to approve on June 16.

Ann Arbor SPARK also receives money from other governmental units in Washtenaw County. In 2013, the $75,000 paid by the city of Ann Arbor to SPARK accounted for more than half of the $132,888 total contributed by all governmental units besides Washtenaw County. The county levies a tax under Act 88, and out of that levy, last year the county contributed $200,000, according to the information provided to the city by SPARK. [.pdf of 2013 "return on investment" from Ann Arbor SPARK] [.pdf of 2013 Ann Arbor SPARK projects] [Ann Arbor SPARK 2013 annual report] [21st Century Jobs Trust Fund 2013 Annual Report]

During public commentary on June 16, three people spoke about the SPARK contract. Kai Petainen read a statement about apparent discrepancies in two reports that provide jobs figures. [Petainen public comment] [Ann Arbor SPARK 2013 annual report] and [21st Century Jobs Trust Fund 2013 Annual Report] Jeff Hayner said that SPARK has misrepresented its results, and he suggested revising the resolution to reduce the $75,000 to just 10% of that figure. And Dave DeVarti, a former councilmember, asked the council to deny or table the funding. He pointed out that $75,000 could go a long way for a human services agency. He asked that the council hold Ann Arbor SPARK to the same kind of standards as it does the human services agencies it has contracts with.

This brief was filed from the city council’s chambers on the second floor of city hall, located at 301 E. Huron.

Action came at the council’s June 2, 2014 meeting after about 20 minutes of deliberation that concluded just before 11 p.m. Carrie Leahy, chair of the LDFA board, and Ann Arbor SPARK CEO Paul Krutko were on hand to answer councilmember questions. The voice vote by the council passed over dissent from Sumi Kailasapathy (Ward 1).

Ann Arbor’s local development finance authority is funded through a tax increment finance (TIF) district, as a “certified technology park” described under Act 281 of 1986. The Michigan Economic Development Corp. (MEDC) solicited proposals for that designation back in 2000. The Ann Arbor/Ypsilanti “technology park” is one of 11 across the state of Michigan, which are branded by the MEDC as “SmartZones.”

The geography of the LDFA’s TIF district – in which taxes are captured from another taxing jurisdiction – is the union of the TIF districts for the Ann Arbor and the Ypsilanti downtown development authorities (DDAs). It’s worth noting that the Ypsilanti portion of the LDFA’s TIF district does not generate any actual tax capture.

The LDFA captures Ann Arbor Public Schools (AAPS) operating millage, but those captured taxes don’t diminish the school’s budget. That’s because in Michigan, local schools levy a millage, but the proceeds are not used directly by local districts. Rather, proceeds are first forwarded to the state of Michigan’s School Aid Fund, for redistribution among school districts statewide. That redistribution is based on a per-pupil formula as determined on a specified “count day.” And the state reimburses the School Aid Fund for the taxes captured by SmartZones throughout the state.

In FY 2013, the total amount captured by the LDFA was $1,546,577, and the current fiscal year forecast is for $2,017,835. About the same amount is forecast for FY 2015.

The extension of the LDFA is made possible by Public Act 290 of 2012, which amended the Local Development Financing Act to allow a SmartZone to capture school taxes for an additional five years or an additional 15 years. The staff memo accompanying the council resolution describes the five-year extension as possible “upon approval of the MEDC President and the State Treasurer, if the Ann Arbor/Ypsilanti SmartZone LDFA agrees to additional reporting requirements and the LDFA requests, and the city councils of Ann Arbor and Ypsilanti approve, the amendment of the LDFA tax increment financing (TIF) plan to include regional collaboration.” The current MEDC president is Michael Finney, former CEO of Ann Arbor SPARK.

A 15-year extension is possible, according to the memo, “if, in addition to the above requirements, Ann Arbor and Ypsilanti, as the municipalities that created the SmartZone, enter into an agreement with another LDFA [a "Satellite SmartZone"] that did not contain a certified technology park to designate a distinct geographic area, as allowed under Section 12b of the Act…”

The council’s resolution states that if the MEDC approves the extension, the city of Ann Arbor will work with the LDFA and the city of Ypsilanti to identify another LDFA – called the “Satellite SmartZone LDFA.” The arrangement will allow the Satellite SmartZone LDFA to capture local taxes in its own distinct geographic area for the maximum 15 years allowed by statute.

Responding to an emailed query from The Chronicle, Sally Petersen (Ward 2) – who sponsored the resolution on the agenda and serves as the council appointee to the LDFA board – wrote that possibilities for an LDFA satellite for Ann Arbor’s SmartZone include Adrian (Adrian College) or Brighton and Livingston County (with Cleary University).

Details on the council’s deliberations are provided in The Chronicle’s live updates filed during the meeting.

This brief was filed from the city council’s chambers on the second floor of city hall, located at 301 E. Huron.

The Transportation Investment Generating Economic Recovery (TIGER) grant is available through the National Infrastructure Investments Program of the U.S. Department of Transportation. SPARK asked that the county’s office of community & economic development (OCED) act as the lead applicant and fiscal agent. OCED already submitted the grant application – on April 25, 2014. According to a staff memo, “due to the grant application deadline, it was not possible to bring the matter before the [board of commissioners] for approval prior to application submission.”

At its May 21, 2014 meeting, the county board of commissioners took an initial vote to authorize the county’s involvement, with final action expected on June 4. The project is a partnership with SPARK, the University of Michigan, the redevelopment firm Walbridge Aldinger and Ypsilanti Township, among others. According to a staff memo, the facility could lead to the creation of up to 7,800 new jobs in the skilled trades and research sectors. [.pdf of staff memo and resolution]

This brief was filed from the boardroom at the county administration building, 220 N. Main St. in Ann Arbor. A more detailed report will follow: [link]

The plan covers 400-408 N. River St. and 107 E. Cross St., an historic property that has been declared ”functionally obsolete and blighted.” That qualifies the project as a brownfield under the state’s brownfield redevelopment financing act (Public Act 381), which allows the owner to receive reimbursements for eligible activities through tax increment financing (TIF). Approval also will allow the developer to apply for Michigan Business Tax Credits. The property is currently owned by Thompson Block Partners LLC, led by Stewart Beal of Beal Properties.

Beal plans to create 16 “luxury lofts” in the structure’s second and third floors, and up to 14,000 square feet of commercial space in the remainder of the site. The project is estimated to cost about $7 million.

The resolution passed by the board also ends a previous brownfield plan for part of the same site, which was approved in 2008. A fire in 2009 delayed the project. The new plan now covers the 107 E. Cross, which was not part of the original plan, and includes public infrastructure improvements, such as streetscape enhancements along North River Street.

The Washtenaw County brownfield redevelopment authority approved this plan at its March 6 meeting. Subsequently, the plan was approved by the Ypsilanti city council on March 18. The city council’s action included approving an “Obsolete Properties Rehabilitation” certificate, which freezes local millages at the current, pre-development level for 12 years. Because of that, the project’s TIF capture will apply only to the state’s school taxes.

The project can get up to $271,578 in eligible cost reimbursed over a 12-year period, for activities including brownfield plan and work plan preparation, limited building demolition, selective interior demolition, site preparation and utility work, infrastructure improvements, architectural and engineering design costs, asbestos and lead abatement, and construction oversight.

The intent of the state’s brownfield redevelopment financing is to support the redevelopment of urban sites that will increase the municipality’s tax base. Tax increment financing allows an entity to capture the difference between the taxable value before a project is undertaken, and the value of the property after it’s developed.

A public hearing on this proposal was held at the April 2 meeting, when the board also voted to give initial approval to the plan. Only one person – Tyler Weston, representing Thompson Block Partners – spoke, telling the board that it would help the project. Weston attended the April 16 meeting, but did not formally address the board. There was no discussion on this item.

This brief was filed from the boardroom of the county administration building at 220 N. Main St. in Ann Arbor. A more detailed report will follow: [link]

The sign on the door to the Ann Arbor city council chamber, installed in the summer of 2013, includes Braille.

The council’s April 7 agenda features two significant items of old business: a first reading of an ordinance that would regulate outdoor smoking in certain locations; and an allocation of funds for the work of a pedestrian safety and access task force.

The pedestrian safety task force funding resolution is now expected to be withdrawn. At the first meeting of the task force, held on Friday, April 4, Ward 1 councilmember Sabra Briere, speaking from the audience, told the group that it was her intent to withdraw the funding resolution when the council meets on April 7. Even if the resolution is withdrawn at the April 7 meeting, however, the task force will be able to continue its work.

Pedestrian issues form one of the themes of the meeting agenda – as the council will be approving annual contracts for the sidewalk repair program, as well as applying for a grant to renovate the pathway in Gallup Park – from the Geddes Dam at the east end of the Gallup Park pathway, to the parking lot east of Huron Parkway. Along with the sidewalk maintenance program contracts, the city council will also be asked to approve the annual street resurfacing program contracts.

Another main theme of the meeting is land use. Carried over as a topic from the council’s March 17 meeting is the surface of the city-owned Library Lane underground parking structure in downtown Ann Arbor. After voting on March 17 to hire a real estate broker, the council will consider a resolution on April 7 that would allocate to the city’s affordable housing trust fund half of the proceeds of any sale of the site’s development rights.

But on April 7, the council will also be considering an amendment to the March 17 resolution that directed the city administrator to list the surface of the Library Lane parking structure for sale. The amendment would require a public process to take place before brokerage services are obtained or the real estate is listed for sale. That public process is supposed to allow discussion of the possibility that the entire surface of the underground parking garage could be used as a park or plaza. The amendment is sponsored by Mike Anglin (Ward 5) and Jack Eaton (Ward 4).

The council will also be considering some items that arrived on its agenda via the city’s planning commission: rezoning of a nature area to PL (public land); and a resolution calling on the University of Michigan to incorporate the city’s land use recommendations as it considers the future use of the Edwards Brothers property on South State Street. The April 7 agenda also includes, as an item of communication, a resolution passed by the city planning commission on March 18, 2014 that gives advice to the council about how to develop the Library Lane property.

In other business, the council will be considering a resolution to approve an expansion of the Main Street business improvement zone (BIZ). The geographic area of the self-assessment district – which handles sidewalk snow removal, sweeping and other upkeep for property owners – would more than double. The final decision rests with the property owners in the expanded area.

Also at its April 7 meeting, the council will consider a resolution asking that Michigan state officials stop opposing a recent court ruling that allows same-sex marriages.

The council’s agenda also includes several street-closing approvals for upcoming events: Taste of Ann Arbor on June 2; The Event on Main Street on June 19; the Ann Arbor Jaycees Fourth of July Parade on July 4; and the Townie Street Party on July 14.

Among the reports and communications attached to the agenda is the final report of a council economic collaborative task force.

This article includes a more detailed preview of many of these agenda items. More details on other agenda items are available on the city’s online Legistar system. The meeting proceedings can be followed Monday evening live on Channel 16, streamed online by Community Television Network starting at 7 p.m.

The Chronicle will be filing live updates from city council chambers during the meeting, published in this article below the preview material. Click here to skip the preview section and go directly to the live updates. The meeting is scheduled to start at 7 p.m.

Outdoor Smoking

A new local law regulating smoking in some outdoor locations will be given a first reading by the council for the third time at its April 7 meeting. The law would regulate smoking outside of public buildings and also potentially in areas of some city parks.

The most recent action – to postpone the ordinance until April 7 – came at the council’s March 3, 2014 meeting. The new ordinance had also been postponed at the council’s Feb. 3 meeting.

Chuck Warpehoski (Ward 5), sponsor of the proposed new local law, had appeared before the city’s park advisory commission on Feb. 25, 2014 to brief commissioners on the proposal and solicit feedback.

Made punishable under the proposed ordinance through a $50 civil fine would be smoking within 20 feet of: (1) bus stops; (2) entrances, windows and ventilation systems of the Blake Transit Center; and (3) entrances, windows and ventilation systems any city-owned building.

The ordinance would also authorize the city administrator to have signs posted designating certain parks or portions of parks as off limits for outdoor smoking, and to increase the distance from entrances to city buildings where outdoor smoking is prohibited.

Where no signs are posted noting the smoking prohibition, a citation could be issued only if someone doesn’t stop smoking immediately when asked to stop.

An existing Washtenaw County ordinance already prohibits smoking near entrances, windows and ventilation systems, according to the staff memo accompanying the resolution – but the county’s ordinance can be enforced only by the county health department. The memo further notes that the Michigan Clean Indoor Air Act does not regulate outdoor smoking.

At the council’s March 3 meeting, other councilmembers expressed concern about the potential disparate impact of such a law on the homeless, and the challenge of enforcement.

Peds: Pedestrian Safety and Access Task Force

At its April 7 meeting, the council will consider for the second time a resolution that would appropriate $197,250 to fund the work of a pedestrian safety and access task force. Action to postpone the resolution until April 7 came at the council’s March 3, 2014 meeting.

The total amount proposed to be appropriated for the task force project budget is $197,250. That amount includes an “estimated $122,500” as the approximate cost of the anticipated city staff effort for the project. The total project budget includes $77,400 for a professional services agreement with Project Innovations Inc.

The funds are to be sourced in part from an allocation made during the May 20, 2013 budget deliberations, which appropriated $75,000 for a study to prioritize sidewalk gap elimination. The connection between sidewalk gaps and the task force’s work is based in part on one of the other “resolved” clauses establishing the task force: “… the task force will also address sidewalk gaps and create a tool for setting priorities for funding and filling those gaps; …”

The pedestrian safety and access task force was established through a council resolution passed on Nov. 18, 2013. Confirmed as members of the task force on Jan. 21, 2014 were: Vivienne Armentrout, Neal Elyakin, Linda Diane Feldt, Jim Rees, Anthony Pinnell, Sarah Pressprich Gryniewicz, Kenneth Clark, Scott Campbell, and Owen Jansson.

Another key “resolved” clause establishing the group’s scope of work includes the following: “… the task force will explore strategies to improve pedestrian safety and access within a framework of shared responsibility through community outreach and data collection, and will recommend to council improvements in the development and application of the Complete Streets model, using best practices, sound data and objective analysis.”

The responsibilities of the task force include delivery of a report a year from now – in February 2015.

The funding for the task force is in part to be used to pay for a $77,400 contract with Project Innovations Inc. to provide facilitator support to the task force.

According to a staff memo written in response to councilmember questions, the facilitator would assist with an anticipated 18 task force meetings, 24 resource group (staff) meetings, five stakeholder meetings and three public meetings. The facilitator would be “preparing materials and agendas; facilitating the meetings; summarizing the meetings; facilitating communication and discussions between, and among, the task force members and the resource group; and, developing materials for community outreach in addition to the actual public meetings, including content for press releases and web page publishing, and a community survey.”

According to the staff memo, a “team of staff members has identified Project Innovations, Inc. as a firm in the region that has demonstrated skill in task force facilitation and robust community engagement efforts, and is uniquely qualified with the capacity to facilitate the pedestrian safety and access task force’s rigorous work approach within the specified timeframe.” Based on the phrasing in the memo, the work appears not to have been put out to bid and Project Innovations was identified as a “sole source” provider.

Project Innovations is the same firm currently providing facilitation support to a citizens advisory committee that is attached to a sanitary sewer wet weather evaluation study being conducted by the city.

The resolution establishing the task force does not explicitly charge the group with a review of the city’s crosswalk law. But the pedestrian safety task force was established in the same time frame as the council was considering an amendment to the city’s crosswalk law. The council ultimately voted to change the language of that law at its Dec. 2, 2013 meeting – so that motorists were required to concede the right-of-way only to pedestrians who had already entered the crosswalk.

That change was subsequently vetoed by mayor John Hieftje. Drawing on the phrasing used in Hieftje’s statement of veto, Stephen Kunselman (Ward 3) has indicated he intends to bring forward an amendment that would require motorists to stop at crosswalks for pedestrians only if “they can do so safely.” At the council’s Feb. 18, 2014 meeting, Kunselman announced he’d be pursuing such an amendment.

Peds: Pedestrian Safety and Access Task Force – Recent Developments

The funding resolution is now expected to be withdrawn. At the first meeting of the task force, held on Friday, April 4, Ward 1 councilmember Sabra Briere, speaking from the audience, told the group that it was her intent to withdraw the funding resolution when the council meets on April 7.

Even if the resolution is withdrawn at the April 7 meeting, the task force would still be able to continue its work. Here’s why. In the resolution that’s expected to be withdrawn, the total amount proposed to be appropriated for the task force project budget is $197,250. That amount includes an “estimated $122,500” as the approximate cost of the anticipated city staff effort for the project. The total project budget includes $77,400 for a professional services agreement with Project Innovations Inc.

So the portion of the project budget that requires hard costs to be covered – other than city staff time – is the cost for the consultant to provide facilitation services. And according to a staff memo to the city administrator written after the council’s action to postpone, the bulk of the cost can already be covered in an existing budget allocation. From the March 27, 2014 staff memo to the city administrator: “The estimated amount for the facilitation work is $70,000 to $90,000. Of this amount, $75,000 is currently budgeted for pedestrian safety and sidewalk-gap planning. The remaining $15,000 will be included in the City Administrator’s recommended FY 14 budget amendment.”

In addition to authorizing the funding, the resolution would authorize a $77,400 contract with Project Innovations for the facilitation work. But now, it’s not clear that particular consultant will be selected for the work. Originally, Project Innovations had been identified by staff as a contractor uniquely qualified to do the facilitation work. Project Innovations is familiar to city staff as the facilitator for a sanitary sewer wet weather evaluation study the city is currently conducting. But now the city has decided to issue an RFP (request for proposals) for the facilitation work. [.pdf of RFP No. 893] Responses to the RFP are due by April 22, 2014.

At the April 4 task force meeting, Connie Pulcipher – a systems planner with the city of Ann Arbor – told members of the task force that they could be involved in the process of interviewing respondents to the RFP. The delay in selecting a facilitator means that the original timeline for the group’s work, which included a final report by February 2015, has shifted to around August 2015.

Peds: Belle Tire Easement

On the council’s agenda is approval of an easement related to the Belle Tire site plan at State and Ellsworth. The planning commission recommended approval at its March 18, 2014 meeting.

Aerial view of a proposed Belle Tire site.

The site plan itself was recommend for approval by the commission at its Aug. 20, 2013 meeting, and the project subsequently received city council approval on Oct. 7, 2013. The site is located in Ward 4.

By way of background, a 50-foot-wide right-of-way easement on the front this site was recorded by the city as part of a previously approved land division for this parcel. That easement reduced the front setback of the Belle Tire building from 10 feet to roughly 3 feet. The minimum front setback for this site is 10 feet.

So the property owner, who also owns the adjacent site at 3975 S. State, has proposed that the city vacate the northern 7 feet of its right-of-way easement.

In exchange, the property owner has offered to convey a non-motorized use easement over the same 7 feet. Such an easement would allow for this strip to be used by the public for future non-motorized transportation facilities, according to a staff memo. And as a non-motorized use easement, the 7-foot strip would be considered part of the required 10-foot front building setback.

Peds: Gallup Park Path

On the council’s consent agenda – a group of items voted on all-in-one-go – is approval of a grant application to fund renovations to a pathway that runs through Gallup Park, which is part of the Border to Border Trail (B2B) connecting the eastern and western borders of Washtenaw County. Renovations would include repairs to the existing asphalt, as well as widening to 10 feet – in part to meet current American Association of State Highway and Transportation Officials (AASHTO) standards.

The grant application would be made to SEMCOG (Southeast Michigan Council of Governments) and MDOT (Michigan Dept. of Transportation) for the Transportation Alternatives Program (TAP). The grant funds, if awarded, would fund renovation of the pathway from the Geddes Dam at the east end of the Gallup Park pathway, to the parking lot east of Huron Parkway. The work would include the loop that leads around that part of the park. Total length of the pathway to be renovated is about two miles.

The city would provide a grant match of $200,000, which would be paid out of the parks and recreation capital improvements millage.

Peds: Sidewalk Maintenance Program

Also related to pedestrian issues are two contracts related to the annual sidewalk maintenance and repair program, which is funded out of a five-year millage approved by voters in November 2011.

A sidewalk marked with a “C” – which indicates that it needs to be cut flush – on Fifth Avenue south of William Street.

Some sidewalk slabs are in reasonably good shape but are out of alignment with adjacent slabs. The city takes the approach of shaving the portion that’s out of alignment so that it’s flush.

Cutting the concrete is more cost effective than replacing the entire slab. The contract for the cutting work for the upcoming 2014 program is to be awarded to Precision Concrete Cutting for $207,350.

The other part of the program involves outright replacement of sidewalk slabs.

That contract is to be awarded to Doan Construction Company for $1,707,037.

Areas of the city of Ann Arbor where sidewalk repair will be done in 2013 and 2014.

Asphalt: Street Resurfacing Program

In addition to an annual sidewalk repair program, the city manages an annual street resurfacing program. On the council’s April 7 agenda is the award of a construction contract to Barrett Paving Materials Inc. for $3.409 million for the 2014 program. Also on the agenda is a professional contract for materials testing – with CTI and Associates Inc. for $82,332.

Heavy black highlights indicate stretches of road that are a part of the city of Ann Arbor’s street resurfacing program in 2014.

Text descriptions of the streets to be resurfaced are as follows:

• Washington: First St to Fourth Ave (April – May)
• Fuller: Maiden Lane to Huron River Bridge (May – June)
• Newport: Sunset to south of Bird Rd (June – July)
• Linwood:, Doty to Wildwood (April – May)
• Northside Grill Alley: Broadway to End (April – May)
• Vinewood: Berkshire to Avon (May – June)
• Steeplechase: Whiltshire to Blaney (June – July)
• St. Aubin: Platt to Creek Dr (June – July)
• Woodbury: Astor to Stadium (July – July)
• Prairie: Plymouth to Aurora (July – August)
• Burlington Court: Burlington to End (July – August)
• Waldenwood & Adjacent Courts: Penberton to Earhart (north end) (July – September)

Asphalt: Windemere Tennis Courts

The council will consider a $134,297 contract with Nagle Paving Co. to relocate and rebuild the tennis courts at Windemere Park. The park advisory commission recommended approval of the contract at its Feb. 25, 2014 meeting.

PAC’s recommendation on the contract followed its approval on Jan. 28, 2014 of a revised new location for tennis courts at Windemere Park, on the city’s northeast side. The final location approved by PAC was one put forward at a public meeting earlier this year.

The new location for the tennis courts has been disputed among neighbors who live near Windemere Park, a nearly four-acre parcel north of Glazier Way between Green and Earhart roads. The tennis courts there have deteriorated, and the city has been looking at options for replacing them. Neighbors had originally advocated keeping the courts in the same location, but the soil there is unstable. Before the area was developed, the current location of the courts was a pond.

Nagle Paving was the lowest of five responsible bidders on the project, according to a staff memo. Including a 10% construction contingency, the entire project budget is $147,727. Funding will come from the FY 2014 park maintenance and capital improvement millage revenues. [.pdf of staff memo and resolution] [.pdf of cost comparison chart]

Land: Library Lot Proceeds to Affordable Housing

The city council will consider a resolution at its April 7 meeting that would direct the city administrator to allocate half the proceeds from a possible upcoming real estate sale to support affordable housing. The land in question is the surface of the Library Lane underground parking structure, which completed construction in the summer of 2012. [.pdf of draft resolution on Library Lane sale]

The Library Lane underground parking deck is highlighted in yellow. The name “Library Lane” is based only on the proximity of the structure to the downtown location of the Ann Arbor District Library. The library does not own the structure or the mid-block cut-through. (Base image from Washtenaw County and City of Ann Arbor GIS services.)

From the resolution: “Resolved, That City Council direct the City Administrator to allocate 50% of any and all proceeds, after fees and closing costs, from the sale of development rights at 319 S. Fifth Avenue [the Library Lane lot] to the affordable housing fund.” Use of money in the city’s affordable housing trust fund is subject to recommendations by the housing and human services advisory board (HHSAB).

Based on a ballpark estimated value for the property of $6-7 million dollars – given by Jim Chaconas of Colliers International at the council’s March 17, 2014 meeting – the resolution would translate to somewhere in the neighborhood of $3 million to support affordable housing, depending on fees and closing costs.

No specific deal appears to be in the offing to develop the top of the structure. But the council voted at its March 17, 2014 meeting to hire a brokerage service to list the development rights to the top of the underground parking garage for sale. At the same meeting, the council passed a separate resolution that reserved 6,500-12,000 square feet on the Library Lane site for a publicly owned urban park.

The resolution allocating 50% of proceeds of a Library Lane sale to support affordable housing is now sponsored by four councilmembers: Sabra Briere (Ward 1), Christopher Taylor (Ward 3), Chuck Warpehoski (Ward 5),  and mayor John Hieftje.

The strategy of channeling at least some of the proceeds of land sales to support affordable housing efforts has been a consistent part of city policy dating back several years. However, the council has not always agreed on the portion of a sale that should be allocated to support affordable housing. At the March 16 Sunday night caucus, Briere indicated one reason she might be reluctant at the following evening’s council meeting to support the hiring of a broker to list the Library Lane development rights for sale: She did not at that time want to take on the fight with other councilmembers about what to do with the proceeds. But Briere voted with seven of her colleagues on the 8-1 vote that saw only Sumi Kailasapathy (Ward 1) dissenting. Sally Petersen (Ward 2) and Margie Teall (Ward 4) were not present for that vote.

The sale of another city property – the former Y lot in downtown Ann Arbor, on William between Fourth and Fifth avenues, across the street from the Library Lane site – is expected to generate roughly $1.4 million in net proceeds from the $5.25 million purchase price. That sale to hotelier Dennis Dahlmann had a closing date of April 2, 2014. And the sale was, in fact, completed.

The council voted at its Dec. 16, 2013 meeting to allocate all of those net proceeds to the affordable housing trust fund. More recently, at its March 3, 2014 meeting, the council directed the city administrator to prepare a budget resolution that would – upon completion of the former Y lot sale – allocate $600,000 from the affordable housing trust fund to the Ann Arbor Housing Commission, to support major capital improvements to its properties.

More than a year ago, at its Oct. 15, 2012 meeting, the council adopted a general policy on proceeds of land sales that was based on a budget committee recommendation. Essentially the policy is to consider land sales on a case-by-case basis, considering all the needs of the city. A nod to affordable housing was included in an amendment added at the council meeting in the form of a statement that all needs of the city would be considered in deciding the use of land sale proceeds – but “especially the need for affordable housing.”

The draft resolution to be considered at the April 7 council meeting cites the budget committee’s recommendation, which was adopted in the Oct. 15, 2012 council resolution, that “no less than 10% of net proceeds of any sale will be allocated and distributed to the affordable housing trust fund …”

Land: Amendment to Library Lane Resolution to List for Sale

On April 7, the council will also be revisiting the March 17 resolution on listing the surface of the Library Lane structure for sale. Mike Anglin (Ward 5) and Jack Eaton (Ward 4) have sponsored a resolution that would delay the hiring of a broker and listing the property for sale until a public process, to be structured by the city administrator, is completed.

That public process is supposed to allow discussion of the possibility that the entire surface of the underground parking garage could be used as a park or plaza. From the resolution:

Resolved, That Resolution R-14-098 Directing the City Administrator to List for Sale 319 South Fifth and Retain Estate Brokerage Services be amended to direct the City Administrator to require that retention of brokerage services be delayed and listing not occur until adequate public process has taken place to explore public uses for the entire property;

Resolved, That the City Administrator structure the public process to allow citizens an opportunity to bring forward and discuss any and all appropriate public uses for this City-owned property, including its use, in its entirety, as a park or plaza;

Resolved, That City Administrator schedule a public hearing as part of the public process for citizen input on public uses for the property

Resolved, That City Administrator provide City Council with report on the public process at its completion; and

Resolved, On completion of the required public process, the City Administrator is directed to seek further direction from City Council as to whether the property should be listed or to continue to develop a wholly public or mixed public/private plan for its use.

The vote on the council’s March 17 resolution was 8-1, with dissent only from Sumi Kailasapathy (Ward 1). Sally Petersen (Ward 2) was absent from the start of the meeting and Margie Teall (Ward 4) departed late in the meeting but before the vote was taken.

The April 7 council agenda also includes, as an item of communication, a resolution passed by the city planning commission on March 18, 2014 that gives advice to the council about how to develop the Library Lane property. The commission’s recommendations focused on conditions for developing the site that would garner economic benefits to the city, such as a mixed-use development that generates foot traffic, with an entry plaza or open space and a design that “creates an iconic addition to the skyline.” The recommendations drew on material in several existing documents, including the Connecting William Street report that was completed by the Ann Arbor Downtown Development Authority about a year ago.

Also attached to the council agenda as an item of communication is a resolution passed by the Ann Arbor District Library board on March 17, 2014. The resolution asked the council to reject designating a portion of the city-owned Library Lane site – which is adjacent to the downtown library – as a public park or plaza at this time.

Land: Recommendation to UM on Edwards Brothers

An additional land-use item on the council’s April 7 agenda is a resolution recommending that the University of Michigan collaborate with the city of Ann Arbor on the future development of the former Edwards Brothers property at 2500-2550 South State Street, immediately adjacent to existing UM athletic facilities. The university is purchasing the 16.7-acre property, following the Ann Arbor city council’s decision on Feb. 24, 2014 not to exercise its right of first refusal to buy the site.

The city planning commission passed the same resolution at its March 18, 2014 meeting and forwarded it to the city council.

The resolution was drafted by planning manager Wendy Rampson based on previous discussions by the planning commission and city council. [.pdf of resolution as amended at March 18 planning commission meeting]

The one resolved clause states:

RESOLVED, That the Ann Arbor City Council and Ann Arbor City Planning Commission request that The Regents of The University of Michigan and President authorize University staff to meet with City representatives to collaborate on issues related to future development of the South Athletic Campus area, including, but not limited to:

• Exploring the creation of one or more parcels fronting South State Street to be developed, preferably privately, for complementary uses adjacent to the South Athletic Campus that also follow the South State Street plan recommendations;
• Discussing options for the relocation of park-and-ride facilities as the South Athletic Campus develops; and
• Discussing the opportunities for a future pedestrian and vehicular connection between South Main Street and South State Street via the planned Oakbrook Drive extension through the South Athletic Campus site.

At the planning commission’s March 18 meeting, Rampson said she’s already shared a draft of the resolution with UM planner Sue Gott and Jim Kosteva, the university’s director of community relations.

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

Land: Stapp Nature Area Addition Rezoning

The council’s April 7 agenda includes a resolution giving initial approval to rezoning of land that’s been donated to the city by developer Bill Martin, founder of First Martin Corp. The 2.2-acre parcel at 3301 Traverwood Drive is being added to the adjacent Stapp Nature Area, near the Leslie Park golf course.

Land donated by Bill Martin to the city of Ann Arbor indicated in red outline..

City staff recommended that the donated parcel be rezoned from R4D (multi-family dwelling) to PL (public land). The land reaches from Traverwood Drive to the Leslie Park golf course, south of Huron Parkway. Adding the land expands a corridor of natural areas and parkland. Stapp Nature Area, a 8.11-acre property with a mature native forest and small vernal pool, is adjacent to Tuebingen Park and has a connection to Leslie Woods.

The site is on the northern edge of a larger property that’s being developed by First Martin Corp. as Traverwood Apartments. That project received its final necessary approvals from the city council on Jan. 6, 2014.

First Martin has committed to creating a pedestrian access from the apartment complex to the nature area, which will be formalized with an access easement.

The city has a policy of rezoning city-owned land to PL (public land). This parcel will be differentiated as parkland by its inclusion in the city’s parks and recreation open space (PROS) plan, because it will become part of the Stapp Nature Area, which is already in the PROS plan.

The council would be giving the rezoning initial approval at its April 7 meeting. The final vote would come at a future meeting after a public hearing.

Land: Main Street BIZ Expansion

On the council’s April 7 agenda is approval of an expansion of the geographic area of the Main Street Business Improvement Zone. The business improvement zone was established in 2010 by a vote of property owners in the zone to provide a mechanism for taxing themselves to pay for items like sidewalk snow removal, sidewalk sweeping and landscaping. [For the state enabling legislation for a BIZ, see Public Act 120 of 1961]

The current geographic area of the Main Street BIZ extends north-to-south from William to Huron on both sides of Main Street, extending to the mid-block alleys. The expansion would extend the area westward by a half block from the alley to Ashley Street. The expansion would also extend the area eastward by a half block along the whole north-south dimension; and between William and Liberty, the zone would expand westward an additional block – to Fourth Avenue.

While the council must give its approval of the plan, the expansion is contingent on a vote among property owners in the area, which has to be set for no later than 49 days after the date of the council’s resolution. The council’s April 7 meeting agenda includes a public hearing on the issue.

Main Street BIZ geographic area and expansion. (Map by The Chronicle from the BIZ plan using Washtenaw County and city of Ann Arbor GIS services mapping tools.)

Same-Sex Marriage

At its April 7 meeting, the Ann Arbor city council will consider a resolution asking that Michigan state officials stop opposing a recent court ruling that allows same-sex marriages. [.pdf of draft resolution on same-sex marriage]

The ruling in question was issued by federal judge Bernard Friedman on Friday, March 21, 2014 in the case of Deboer v. Snyder. In that ruling, Friedman found that Article I, Section 25 of the Michigan Constitution – which limits the benefits of marriage to unions between one man and one woman – did not advance any legitimate state interest. So the ruling had the effect of making same-sex marriages legal in Michigan.

But the day following the decision, on March 22, the U.S. Court of Appeals for the Sixth Circuit issued a temporary stay on Friedman’s ruling. Michigan’s Gov. Rick Snyder and Attorney General Bill Schuette are appealing Friedman’s decision.

The council’s resolution reads in part:

RESOLVED, That the Ann Arbor City Council urges Governor Snyder and Attorney General Schuette to immediately suspend all efforts to appeal or otherwise contest Judge Friedman’s Ruling…

Before the stay on Friedman’s ruling took effect, Washtenaw County clerk Larry Kestenbaum opened his office for business on Saturday, March 22, and issued 74 marriage licenses for same-sex couples in Washtenaw County. The county board had already set the stage for those couples to receive what practically amounts to a fee waiver for the expedited processing of a license, which ordinarily takes three days. The “fee” approved by the board at its Feb. 19, 2014 meeting reduced the usual fee from $50 to 1 cent.

The resolution passed by the county board on Feb. 19 allows the county clerk, consulting with the county administrator, to establish a “fee holiday” on the day preceding a period during which the office’s vital records division would be closed for four or more days, or when an unusual number of marriage license applicants are expected to appear. During a “fee holiday,” the charge for immediately processing a marriage license is 1 cent.

The resolution to be considered by the Ann Arbor city council on April 7 currently initially had four sponsors: Christopher Taylor (Ward 3), Margie Teall (Ward 4), Sabra Briere (Ward 1) and Chuck Warpehoski (Ward 5). Later Jane Lumm (Ward 2) and mayor John Hieftje were added, for a total of six. So that resolution is almost sure to be approved – because it needs only a six-vote majority on the 11-member council.

Economic Collaborative Task Force

Among the many agenda attachments – reports and communications – is the final report of the economic collaborative task force, established by the council last year at its May 20, 2013 meeting. The idea to establish the task force had grown out of a desire to review the Ann Arbor Downtown Development Authority in the context of proposed changes to the city ordinance governing the DDA. The task force drew members from city of Ann Arbor, Ann Arbor SPARK and the Ann Arbor DDA.  [.pdf of March 28, 2014 economic collaborative task force report]

In more detail, the task force was supposed to do the following:

• Provide clarity, alignment and specificity on economic development policy and objectives for fiscal year 2014 toward accomplishing city council’s success statement for Economic Development.
• Provide for strategic alignment of priorities between the Task Force member entities.
• Highlight cost sharing and maximizing of resource utilization.
• Identify options for sustaining, modifying, or eliminating operations in a financially-responsible manner through efficiencies and/or partnerships as part of a cohesive economic development plan for the city.

The “success statement” mentioned in the resolution was crafted by the city council at a budget retreat held in late 2012.

Those initially appointed to represent the city on the task force were city administrator Steve Powers, Sally Petersen (Ward 2) and then councilmember Marcia Higgins (Ward 4).

According to the resolution establishing the task force, a report was supposed to be presented to the council in December 2013 and the task force was supposed to expire at the end of 2013.

The 4.5-page report in general calls on the city, the Ann Arbor DDA and Ann Arbor SPARK to continue existing initiatives.

Some highlights of the report include a recommendation that the city consider technology infrastructure that is “essential for companies to compete globally and for communities to attract the necessary talent.” In that category of infrastructure, the report indicates that the city and Ann Arbor SPARK should “continue their work to develop a proposal for high-speed fiber that would accelerate both commercial and residential internet speeds.”

Also recommended in the report is the preparation of a plan to market and sell surplus city-owned properties. Properties included on the list include the South Ashley/West William (Kline) lot, the South Main/East William (Palio) lot, Library Lane, and 415 W. Washington.

4:00 p.m. Staff written responses to councilmember questions about agenda items are now available. [.pdf of April 7, 2014 staff responses to councilmember questions]

6:24 p.m. Sally Petersen (Ward 2) has already arrived in council chambers. She was here earlier for a meeting of the council rules committee – along with Chuck Warpehoski (Ward 5), Christopher Taylor (Ward 3), mayor John Hieftje and Sabra Briere (Ward 1). Dinner for Petersen tonight at the council table is salad.

6:37 p.m. Paul Fulton with the city’s IT department is here, available to comment on an agenda item involving the TRAKiT system.

6:58 p.m. Council chambers are starting to fill up. Councilmembers Jane Lumm (Ward 2), Sumi Kailasapathy (Ward 1), Jack Eaton (Ward 4), Mike Anglin (Ward 5), Taylor, and Warpehoski have all arrived.

6:59 p.m. Councilmembers Margie Teall (Ward 4) and Stephen Kunselman (Ward 3) have now arrived.

7:03 p.m. Pre-meeting activity. The scheduled meeting start is 7 p.m. Most evenings the actual starting time is between 7:10 p.m. and 7:15 p.m. We’re almost ready to start.

7:08 p.m. And we’re off.

7:08 p.m. Call to order, moment of silence, pledge of allegiance.

7:09 p.m. Approval of agenda. All councilmembers are present and correct.

7:11 p.m. Approval of agenda. Kunselman is bringing back the two resolutions from the last meeting on the Library Lane site for reconsideration. He was on the prevailing side for both of those resolutions – which were both approved.

7:13 p.m. The items will be placed under “unfinished business” which comes right after the outdoor smoking ordinance. And Eaton wants DC-4 to be heard before DC-3.

7:13 p.m. Outcome: The council has approved its agenda for tonight’s meeting, over dissent from Teall.

7:16 p.m. Communications from the city administrator. City administrator Steve Powers reports that the amount of funds available from the sale of the former Y lot is $1.42 million. Powers also notes that the homeless shelter had found housing for 107 people this season as of the end of February.

Powers now is alerting the council to the report of the collaborative economic task force, which is attached to tonight’s agenda.

7:16 p.m. INT-1 Veg Week Proclamation. The week of April 21-27, 2014, is being proclaimed as Ann Arbor Veg Week. The proclamation names several local organizations and businesses as supporting it: Nicola’s Books, The Lunch Room, Ann Arbor District Library, Humane Society of Huron Valley, Main Street Area Association, A2 Fitness Professionals, and Current Publications. More than 20 restaurants that will be offering vegan special menu items throughout the week, according to the resolution.

7:21 p.m. INT-2 Elizabeth Dean Day Proclamation. This proclamation honors Elizabeth Russell Dean, who died exactly 50 years ago today, on April 7, 1964. She bequeathed nearly $2 million for the benefit of public trees of Ann Arbor, which is held in a trust with the annual interest income to be used for the planting, care and maintenance of these trees. The proclamation of the anniversary of Dean’s death as Elizabeth R. Dean Day “serves as a reminder of the vast contributions Ms. Dean made to ensure that Ann Arbor will forever remain a ‘City of Trees.’”

7:22 p.m. Edith Fletcher and Jane Immonen are on hand to receive the proclamation.

7:22 p.m. Public commentary reserved time. This portion of the meeting offers 10 three-minute slots that can be reserved in advance. Preference is given to speakers who want to address the council on an agenda item. [Public commentary general time, with no sign-up required in advance, is offered at the end of the meeting.]

Eight people are signed up to speak during public commentary reserved time, half of them to address the topic of the Library Lane site: Alan Haber, Odile Hugonot-Haber, Ingrid Ault and Ali Ramlawi. Ault is chair of the park advisory commission. Ramlawi is owner of the Jerusalem Garden restaurant, which is currently located almost directly adjacent to the Library Lane property and will border the lot when it moves into the former Seva building.

Thomas Partridge is signed up to talk about affordable transportation. Frank Burdick is signed up to talk about the funding resolution for the pedestrian safety task force. Cliff Douglas is signed up to talk about the outdoor smoking ordinance. Douglas is director of UM’s Tobacco Research Network. And Kermit Schlansker is signed up to talk about “How to Sow the Earth.”

7:28 p.m. Thomas Partridge introduces himself as a recent candidate for the state legislature and for the city council. He calls attention to the fact that U.S. president Barack Obama visited Ann Arbor last week, to support an increase to the minimum wage. He wishes that Obama had also supported an expanded transit system in his remarks. Partridge calls for affordable housing and the elimination of homelessness. He advocates for affordable healthcare and lifetime education. He notes the needs of the most disadvantaged members of society, saying we must give more attention to the most vulnerable among us. He calls on people to support the transit millage [on the May 6 ballot].

7:29 p.m. Frank Burdick introduces himself as a Ward 4 resident. He asks that the council postpone consideration of funding a consultant for the pedestrian safety task force. He says that city staff are competent to serve the role of a facilitator. He calls on the council to fund concrete, not more consultants.

7:33 p.m. Cliff Douglas speaks in support of the outdoor smoking ordinance. He’s lived in Ann Arbor since 1997, he says, and is speaking as an individual. But he’s also director of UM’s Tobacco Research Network. He names a number of other individuals at the UM School of Public Health who support the ordinance. The key issue, he says, is that although smoking is devastating to its users, it also causes harm to the environment and results in avoidable cleanup costs. In the U.S. there are 921 municipalities with 100% smoke-free ordinances. He has an 11-year-old son and can’t count the number of times the boy has put cigarette butts in his mouth. Cigarette butts are the leading cause of litter, he says.

7:36 p.m. Alan Haber tells the councilmembers that he’s written to each of them asking them to postpone the idea of selling the Library Lane site. They should use the occasion to establish a public process to explore the full public use of the land. There’s a font of creativity in this town to which the council should open the door, he says. There are possibilities for good and the future and for the children of future generations, he says. He urges the council not to press to find out how much it’s worth in terms of monetary value. He urges beginning now with intermediate activities. He’s asking for support and encouragement for people to gather on the surface of the Library Lane underground garage on Earth Day, which falls on April 22.

7:39 p.m. Ingrid Ault introduces herself as a Ward 1 resident and chair of the city’s park advisory commission. She says she’s puzzled about the idea that the listing of the Library Lane site for sale should be delayed until a public process can take place. She cites the Connecting William Street study and the work of the PAC subcommittee on downtown public parks as public process that has already taken place. About public process she says, “This has already been done.” “When will the madness stop?” she wonders. She hopes it will stop tonight. How would the process be different? She says that a “special interest group” [the Library Green Conservancy] can’t take no for an answer. She asks the council to “end the hamster wheel ride tonight.” [Editor's note: Will Hathaway of the Library Green Conservancy has contacted The Chronicle, saying that while some members of the conservancy are certainly in favor of this resolution, the group has not taken a position on it.]

7:41 p.m. Odile Hugonot-Haber says it’s amusing to her to hear that there’s been a lot of public process and when the process has been done, so many people say they want a public space, a green space, a place where people can come together. There is no place for women with their children to go, she says. The people have clearly spoken, she says, but elected and appointed officials refuse to hear.

7:43 p.m. Kermit Schlansker says that the U.S. Senate had an all-night session recently on global warming. He says conservation is overlooked as a solution. We desperately need to reduce our energy consumption, he says. He calls for living configurations like an apartment house on farmland. Bigger buildings are easier to heat, he says.

7:48 p.m. Ali Ramlawi thanks mayor Hieftje for over 10 years of service. even if he’s disagreed with some of Hieftje’s policies. The future of the surface of the Library Lane site has been a hot button issue, he says. He says that the whole western half should be a plaza. It’s too small for just the southwest corner to be used as a plaza, he says. There’s a lot of fear that the next Liberty Plaza will be built. Liberty Plaza is haunted with a poor design, he says. A better design and a better police presence would lead to a successful plaza, he says.

7:48 p.m. Communications from the council. This is a slot on the agenda for council communications. It’s a time when councilmembers can report out from boards, commissions and task forces on which they serve. They can also alert their colleagues to proposals they might be bringing forward in the near future.

7:49 p.m. Margie Teall is thanking everyone who helped put on FestiFools this past weekend.

7:51 p.m. Jane Lumm announces that there’s a public meeting hosted by MDOT on the Jackson Avenue reconstruction project from Dexter to Maple. The road will be reconfigured to three lanes – one in each direction and a turn lane. She had not supported that configuration. The meeting will take place on April 10 from 4-6 p.m. at the downtown library. Chuck Warpehoski notes that the purpose of the meeting is to inform the public about the construction schedule. It’s being set up as a drop-in, drop-out situation.

7:54 p.m. Mike Anglin says that when city staff, who are extremely competent, are used in projects then it gets good results. When consultants are used, it creates a disconnect, he says. There’s a good dialogue going on between staff and residents along Seventh Street about traffic calming, he says.

7:55 p.m. Communications from the mayor. Hieftje is describing an energy conference and signing the Alliance to Save Energy.

8:00 p.m. Hieftje is saying that the weather at FoolMoon on Friday, April 4 was wet and cold. He’s recounting several other events of the weekend, including Hash Bash. Hieftje reports that Obama told him he likes coming to Ann Arbor.

Hieftje is now following up on the city administrator’s remarks on the homeless shelter. He says that he met with leaders of Washtenaw County on the topic of homelessness. The city administrator will be providing a report on the work of the shelter and costs that were incurred during the past season. Hieftje is reviewing the history of the homeless shelter. The proportion of county residents served there has decreased over the years, he says. The system is not designed to handle these kind of numbers: Is it a regional center for southeast Michigan? If so, then the city needs to work with the state legislature and other regional partners, he says.

8:02 p.m. Briere inquires about the implications of refusing service to anyone.

8:05 p.m. MC-1 Confirmation of appointments. This item will confirm nominations from the council’s previous meeting, on March 17. The appointments are:

• Ann Arbor Commission on Disability Issues: Westley Resendes, filling a vacancy left by Patti Smith, for a term ending May 31, 2015;
• Economic Development Corporation: Dale Leslie and Tim Marshall (re-appointments for terms ending May 31, 2019);
• Historic District Commission: Ellen Ramsburgh (re-appointment for a term ending May 31, 2017);
• Public Market Advisory Commission: Aimee Germain (re-appointment for a term ending May 31, 2017).

8:05 p.m. Outcome: The council has voted to approve all the nominations made at its previous meeting.

8:05 p.m. MC-2 Nominations. A raft of nominations is being made tonight. The vote on the appointments will come at the next meeting of the council. The nominations are:

• Airport Advisory Committee: Mary Karen McClellan (filling a vacancy, for a term ending May 30, 2016);
• Ann Arbor Housing Commission: Gwenyth Hayes (serving out rest of term for Gloria Black as a resident’s representative, through May 4, 2015) and Daniel Lee (re-appointment, for a term ending May 6, 2019);
• Design Review Board: Shannan Gibb-Randall (serving out rest of term for Mary Jucari, through May 30, 2015);
• Employees Retirement Systems Board of Trustees: Mark Heusel (re-appointment for a term through May 2, 2017);
• Public Market Advisory Commission: David Santacroce (re-appointment for a term through May 30, 2017).

8:06 p.m. Public hearings. All the public hearings are grouped together during this section of the meeting. Action on the related items comes later in the meeting. Two public hearings appear on tonight’s agenda.

For the first one, the property owner has proposed that the city vacate the northern 7 feet of its right-of-way easement. In exchange, the property owner has offered to convey a non-motorized use easement over the same 7 feet. Such an easement would allow for this strip to be used by the public for future non-motorized transportation facilities, according to a staff memo. And as a non-motorized use easement, the 7-foot strip would be considered part of the required 10-foot front building setback. This resolution would approve that arrangement. [For more background, see Peds: Belle Tire Easement above.]

The second public hearing is on the expansion of the geographic area of the Main Street Business Improvement Zone. The business improvement zone was established in 2010 by a vote of property owners in the zone to provide a mechanism for taxing themselves to pay for items like sidewalk snow removal, sidewalk sweeping and landscaping. For the expansion to be finalized it will need to be approved by property owners in the expanded district. [For more background, see Land: Main Street BIZ Expansion above.]

8:07 p.m. PH-1 Belle Tire ROW Vacation. No one speaks at this public hearing.

8:07 p.m. PH-2 Amended Main Street BIZ plan.

8:09 p.m. Thomas Partridge says he thinks that this plan should give more attention and greater priority to seniors and those who need access to public transportation.

8:11 p.m. Jan Culbertson says she’s a property owner in the area. She supports the expansion. The consistency of the services is important, she says.

8:13 p.m. Bill Kinley speaks in favor of allowing property owners to make a decision about whether to participate in the expanded BIZ. He’s eager to see a consistent and attractive sidewalk experience. This is not an expense for general taxpayers, but rather of the property owners in the area, he points out.

8:14 p.m. Jim McDonald asks the council to allow property owners to vote on whether they want to participate in the expanded BIZ.

8:14 p.m. Ed Shaffran introduces himself as chair of the Main Street BIZ board. He thanks councilmembers for the conversations he’s had with them. He’s there in case they have any questions, he says.

8:15 p.m. Approval of previous meeting’s minutes.

8:15 p.m. Outcome: The council has voted to approve the minutes of its previous meeting.

8:15 p.m. Consent agenda. This is a group of items that are deemed to be routine and are voted on “all in one go.” Contracts for less than $100,000 can be placed on the consent agenda. This meeting’s consent agenda includes:

• CA-1 Approve contract for construction materials testing with CTI and Associates Inc. for the 2014 street resurfacing project ($82,332)
• CA-2 Approve purchase a TS15P R1000 Robotic Total Station and DNA10 Digital Level for Surveying ($33,671)
• CA-3 Approve purchase order for annual maintenance and support of TRAKiT System with CRW Systems Inc. for FY 2014 ($36,500)
• CA-4 Street Closing: Townie Street Party (Monday, July 14, 2014)
• CA-5 Street Closing: Ann Arbor Jaycees Fourth of July Parade (Friday, July 4, 2014)
• CA-6 Street Closing: Townie Party-Ann Arbor Mile (Monday, July 14, 2014)
• CA-7 Approve Transportation Alternatives Program Grant application to SEMCOG and MDOT to fund renovations of the Gallup Park pathway. [For more background, see Peds: Gallup Park Path above.]
• CA-8 Street Closing: Taste of Ann Arbor (Sunday, June 2, 2014)
• CA-9 Street Closing: The Event on Main Street (Thursday, June 19, 2014)

8:15 p.m. Councilmembers can pull out any item on the consent agenda for separate consideration. No one does tonight.

8:15 p.m. Outcome: The council has now approved all items on its consent agenda.

8:16 p.m. C-1 Outdoor Smoking Ordinance. This is still the first reading of a new local law regulating smoking in some outdoor locations. It was previously postponed at two different council meetings. The law would regulate smoking outside of public buildings and also potentially in areas of some city parks. Made punishable under the proposed ordinance through a $50 civil fine would be smoking within 20 feet of: (1) bus stops; (2) entrances, windows and ventilation systems of the Blake Transit Center; and (3) entrances, windows and ventilation systems any city-owned building. [For more background, see Outdoor Smoking above.]

8:18 p.m. Warpehoski first moves to replace a substitute resolution. It specifies that it’s a police officer who can enforce the ordinance, not a general employee.

Ellen Rabinowitz, interim health officer for Washtenaw County, is now at the podium sharing the county’s experience in enforcing the county’s ordinance on smoking outside entrances to buildings.

8:23 p.m. Rabinowitz is echoing the sentiments of Cliff Douglas during public commentary. Enforcement has been straightforward, she says. “Our experience in Washtenaw County has been quite good.” There’s been lots of compliance, she says.

Warpehoski is asking about Rabinowitz’s work with the Village of Dexter. Warpehoski invites her to explain why an enforcement mechanism is needed at all, if the idea is that it will be self-enforced.

8:24 p.m. Warpehoski asks Rabinowitz to comment on the benefit of such an ordinance as a public health professional. She ticks through the dangers of smoking. It harms users and innocent bystanders, she says. Anything we can do to limit smoking is a good thing, she says.

8:26 p.m. Eaton confirms that Rabinowitz works for Washtenaw County. He ventures that the county has not made efforts to ban smoking in its parks. She explains that the county parks commission has designated certain areas of county parks as non-smoking. Eaton confirms with Rabinowitz that she is the enforcement officer. He’s quizzing her about how the enforcement mechanism works.

8:28 p.m. Kunselman ventures that the county sheriff does not have a role in enforcement. Rabinowitz confirms that. Kunselman asks if she or her designee has the ability to issue a citation. It seems so. Kunselman says his concern is that he doesn’t want law enforcement officers to be writing tickets. He says it sounds like most people comply when they’re asked to stop.

8:30 p.m. Teall wants information about how other municipalities handle enforcement. Lumm notes that the county has had few complaints filed about violations. Lumm says that the council has received a letter from the People’s Food Co-op. Lumm asks if Rabinowitz has received a complaint from that business. Rabinowtz isn’t sure if People’s Food Co-op was one of the 400 complaints over the last 12 years.

8:31 p.m. Kailasapathy wonders how the city ordinance will add to the county ordinance. Rabinowitz says it will add teeth.

8:33 p.m. Kailasapathy asks for specifics about what Rabinowitz means by “teeth.” She means it in the sense of an additional tool, not in the sense that police officers will enforce it. Kailasapathy wonders if AAPD should be tackling heroin use at the public library or chasing down smokers.

8:34 p.m. Rabinowitz tells Kailasapathy that she’s right: They need to address the problem of heroin overdoses. But the smoking ordinance, she thinks, will be largely self-enforcing.

8:35 p.m. Briere asks if Warpehoski will accept a friendly amendment to the definition of “smoking.” She wants to add e-cigarettes to the definition. Warpehoski says he’d consider that friendly.

8:37 p.m. Warpehoski says he’s continued his outreach to various organizations: merchant area associations and the Ann Arbor Downtown Development Authority. He didn’t hear any objections. He recounts the origin of the ordinance – that he’d heard from constituents who felt trapped in situations where they could not get away from second-hand smoke. What drove it home for him was hearing from local businesses in the Sculpture Plaza area.

8:40 p.m. Warpehoski says the allocation of police officers is a red-herring argument. He cites a report out of Toronto that indicates outdoor smoking ordinances don’t cause an additional burden on police. He’s now going over arguments based on litter prevention. He calls it a humble effort. It’s narrow in scope, he says.

8:43 p.m. Warpehoski says it’s a way to make a healthier community. We should have smoke-free playgrounds and bus stops, he says. Taylor thanks Warpehoski for his work in amassing the information. It’s a deeply reasonable effort, he said. Smoking is a scourge, Taylor says, and smokers are accustomed to having a limited set of areas in which they can smoke. The facts are plainly stated, he says. It’s a reasonable ordinance. Concerns about allocation of police resources are not reasonable, Taylor says.

8:46 p.m. Kunselman reports the experience he had of walking behind a group of women who were walking down the sidewalk, three of whom were smoking. That would still be legal, he says. He ventures that receptacles for butts are provided. He brings up the issue of wood smoke, like that generated at Bill’s Beer Garden. He’s received complaints from constituents about wood burning in neighborhoods. He asks Warpehoski if he’d be willing to remove the penalty of a $50 ticket. If there’s a problem with compliance, then the council can revise the ordinance, Kunselman says.

8:48 p.m. Warpehoski ventures that Kunselman might be right that the new law would just move smokers to the sidewalk. But he sees that as an improvement. Warpehoski is now talking about the general issue of good and bad behavior in parks. If there’s a park where smoking is common, that would drive him and his kids out of that park.

8:49 p.m. On the wood smoke issue, Warpehoski says that he’d tried to keep his effort focused and targeted.

8:51 p.m. On the idea of removing the penalties, Warpehoski says we have a set of ordinances – not a book of suggestions. He invites Kunselman to move an amendment and see where it goes.

8:53 p.m. Hieftje says we’ve been talking about this for a while. He says that the information available now is typical of what the council has for a second reading. He says that he doesn’t understand why the council is overthinking the idea of banning smoking in city parks. Lumm says it’s not rational to pass ordinances at first reading just to get to second reading.

8:53 p.m. Lumm is talking about Satchel’s BBQ on Washtenaw Avenue and the wood smoke that comes from there.

8:56 p.m. Lumm says the ordinance is a solution in search of a problem. She appreciates that the ordinance has been amended. She calls it a pretty big step to regulate smoking in city parks. Many of the issues have not been addressed to her satisfaction, she says.

8:58 p.m. Kailasapathy says that the ordinance is structured to be punitive and not educational. Lower socio-economic groups have higher smoking rates, she says. She worries about the disparate impact. She wishes that the police can be taken out of the equation.

8:59 p.m. Warpehoski reiterates his response to Kunselman – that an amendment removing the penalty could be made, but he wouldn’t support it.

9:01 p.m. Eaton asks why e-cigarettes were added through Briere’s amendment – because he thought they did not emit harmful fumes. Cliff Douglas is explaining that these devices are not regulated and that they do contain nicotine.

9:02 p.m. Eaton and Douglas are engaged in a back-and-forth on e-cigarettes.

9:05 p.m. Eaton and Douglas are now discussing enforcement issues.

9:07 p.m. Douglas tells Kunselman that smoking rates have dropped on the UM campus.

9:08 p.m. Kunselman ventures that there’s no enforcement on the UM campus of the no-smoking ordinance, but it still works. Douglas allows that the campus police don’t enforce it, but there is an enforcement mechanism – through an employee’s supervisor, for example.

9:10 p.m. Teall says, “I want to say something!” If there’s a sign you can point to, that allows an ordinary citizen to have something to back up a request made to someone to stop smoking, she notes.

9:12 p.m. Eaton is in a back-and-forth with Rabinowitz on how compliance works.

9:14 p.m. The chief health officer for UM is now at the podium. UM had wanted to be respectful of smokers, but also wanted to create a healthy campus. The medical campus had been smoke-free since 1998, he says. Only one person had been discharged from employment for repetitive smoking, he says.

9:16 p.m. People are not issued citations at UM for smoking anymore than people would be issued a citation for not eating their five vegetables. Warpehoski asks how smoking at UM stadium is handled.

9:18 p.m. Petersen calls the question, saying that the ordinance has a lot of common sense in it and is very practical. Hieftje says everyone needs to have had a chance to speak.

9:20 p.m. [The council isn't voting on calling the question.]

9:20 p.m. Outcome: The council has voted to give initial approval of the ordinance regulating smoking in some outdoor locations, over dissent from Kailasapathy, Lumm and Eaton.

9:21 p.m. C-2 Stapp Rezoning. This item would give initial approval to rezoning of land that’s been donated to the city by developer Bill Martin, founder of First Martin Corp. The 2.2-acre parcel at 3301 Traverwood Drive is being added to the adjacent Stapp Nature Area, near the Leslie Park golf course. [For more background, see Land: Stapp Nature Area Addition Rezoning above.]

9:21 p.m. Briere gives some brief background.

9:21 p.m. Outcome: The council has voted to give initial approval of the rezoning.

9:21 p.m. Recess. We’re now in recess.

9:35 p.m. We’re back.

9:36 p.m. Reconsideration: Library Lot – Designation of Area as Urban Park

9:37 p.m. The council has voted to reconsider the resolution. It was a voice vote, with some dissent, not clear who.

9:38 p.m. Kunselman calls the situation that has arisen – the “unpredictability of posturing politicians trying to please people.”

9:42 p.m. Kunselman is proposing that the previous resolution be amended so that the square footage for the urban plaza is approximately 12,000 square feet. [This is prompted by the fact that Briere proposed the amendment at the March 17 meeting that changed the square footage from 12,000 square feet to a range – from 6,500 to 12,000. And now Briere has co-sponsored the resolution by Eaton and Anglin, later on the agenda, that calls for a public process that could result in the entire surface of the parking structure being used as an urban plaza.]

9:44 p.m. Briere responds to Kunselman by drawing the distinction between a civic use and a greatest and highest use. Hieftje ventures that the council’s action is making it difficult to follow what is going on. He says that using the entire South Fifth Avenue frontage (12,000 square feet) would cost the city $2 million in terms of potential selling price. He’s hesitant to give that up – $1 million of which could go to support affordable housing.

9:45 p.m. Kunselman says he supports the idea of a cantilevered building. He cites the comments from Jerusalem Garden owner Ali Ramlawi during public commentary in support of the idea that a plaza of 6,500 would be too small.

9:47 p.m. Teall says she shares Hieftje’s concerns. She likes the flexibility of the range – 6,500 to 12,000 square feet. She says 6,500 is not too small. Petersen is glad to see these resolutions come back. She says that passing the resolutions “jumped the gun” a little bit. Petersen is pitching the idea of a postponement.

9:48 p.m. Petersen says she wants the time of the postponement to be used to put together a group of stakeholders: the Ann Arbor District Library, Ann Arbor Area Transportation Authority, First Martin, Dennis Dahlmann, the Ann Arbor Downtown Development Authority, and the Library Green Conservancy, among others.

9:49 p.m. Petersen says she wants to postpone until the first meeting in October. Hieftje points out that the question before the council right now is Kunselman’s amendment. So the council goes back to the amendment.

9:50 p.m. On the amendment, Taylor says that it’s inconsistent with the library’s view and with the park advisory commission’s view. It’s a blunt instrument that has been deployed for a delicate task, he says. If it’s passed as amended, it would be an impediment to the development of this important parcel.

9:51 p.m. Petersen gets confirmation that the amendment would be consistent with a cantilevered building over the northwest portion of the property.

9:53 p.m. Briere says she hopes that a public space is going to be built. The language change at the last meeting was recommended to her by those who supported the park, she says. Her interest was in making the northern boundary of a plaza flexible. She responds to the talk about a cantilevered building by saying she’s not interested in trying to design a building at tonight’s meeting.

9:56 p.m. Briere quips that it’s an interesting challenge to not posture politically on the council. She won’t support Kunselman’s amendment. Anglin says the question of when we will have a community space in this town has been discussed for a long time. Anglin says he’s not running for office; he’s speaking for the public. He wonders if the council’s action at the last meeting was really what the public wants. He can’t support 12,000 square feet because he’s thinking about something much larger.

9:59 p.m. Warpehoski said at the last meeting there had been a dual narrative that we’d done a lot of process and that we’d not done enough process. He seeks a solution that 1. works for park advocates; 2. works for the city; 3. works for the AADL. He won’t support the amendment. Lumm says she will support it, saying the difference between 6,500 and 12,000 is small.

10:00 p.m. Taylor stresses that the PAC recommendation had not been 12,000 but rather more than the 5,000 that had been indicated in the Connecting William Street study.

10:01 p.m. Part of Warpehoski’s comments included the sentiment that he wanted to see a park on the Library Lane site in time for his kids to be able to play on it.

10:02 p.m. Eaton reminds the council that a sale of this property would require an eight-vote majority on the 11-member council. He said that there wouldn’t be eight votes without 12,000 square feet of parkland. He’ll support the amendment.

10:03 p.m. Kunselman says that the surface has been a surface parking lot for a very long time and he thought it would stay that way.

10:04 p.m. Outcome: The amendment passes over dissent from Briere, Taylor, Teall, Warpehoski, and Hieftje.

10:06 p.m. Petersen moves for postponement. Powers asks an opportunity to provide the council with better than just a guess about how long the stakeholder work would take. So the postponement would be to the next meeting, on April 21.

10:07 p.m. Kailsapathy says the resolution should be voted on tonight, and that the stakeholder meetings can be a separate resolution. She doesn’t want to drag it out. Hieftje also won’t support the postponement. There’ve been over 40 public meetings and it’s been going on for years, he says.

10:09 p.m. Taylor says he’ll support the postponement. The reconsideration was appropriate from a parliamentary perspective. But the AADL would probably have a hard time swallowing that as a proper process, he says. The notion that it was amended and passed at the previous meeting, then at this meeting restored to its original form, would be seen as borderline contemptuous of the library’s position, Taylor says.

10:11 p.m. Lumm says that the council is well informed of the AADL’s position. She says she’s going to oppose postponement.

10:13 p.m. Warpehoski says that once upon a time, a pig and a chicken decided to go into business that would serve ham and eggs. Then they said they weren’t sure if they should do that because one of them was bringing the ham and the other was bringing the eggs. Different stakeholders on the Library Lane site would be bringing ham and others would be bringing eggs. He would support the postponement because he was optimistic that the stakeholders could work something out.

10:15 p.m. Petersen explains to Kailaspathy that the postponement for two weeks would allow the city administrator to provide an update on the progress of hiring a broker, which would also include information on programming and maintenance of the public space on top of the Library Lane site.

10:16 p.m. Hieftje wants to move toward a vote on the postponement. Anglin asks a procedural question about reconsideration.

10:17 p.m. Kunselman says he won’t support the postponement. He appreciates Petersen’s effort to coordinate everyone, but he thinks that will create additional unneeded complexity. He ventures that Powers has not yet hired a broker, so there wouldn’t be much of an update.

10:19 p.m. Kunselman says that it’s important for the broker to have a clear understanding of what the council’s intent is. He cautions against postponing to get more information, when there is not going to be any additional information.

10:21 p.m. Outcome: The postponement fails on a 5-6 vote. Voting against were Kailasapathy, Lumm, Kunselman, Eaton, Anglin and Hieftje.

10:21 p.m. Taylor says this resolution is borderline contemptuous of the library. It’s also unwise – because predetermining the size of the public space without the full context of the site is inconsistent with that open space being successful.

10:22 p.m. Outcome: The council has voted to approve the resolution as amended to stipulate the 12,000 square footage – over dissent from Taylor, Teall, Warpehoski, and Hieftje.

10:23 p.m. Reconsideration: Direct Library Lot Listing for Sale

10:23 p.m. The council has voted to reconsider the resolution from last meeting.

10:24 p.m. Kunselman reports that he met with the outside bond counsel last Friday – on the private and public use questions related to the Build America Bond financing. The post-construction analysis had not been done, Kunselman says.

10:27 p.m. Kunselman says there wouldn’t be a post-construction analysis until the property was listed for sale. He says the number of private use spaces available will affect the value of the property. He’s going through the actual costs paid for construction and asks how much of the debt was actually applied. What if the number of spaces is significantly less than the 29% that were calculated pre-construction? He brought it back for reconsideration to let his colleagues know why it was important to list it for sale.

10:28 p.m. Anglin asks why the council can’t get the post-construction analysis just by asking for it.

10:31 p.m. Hieftje tells Anglin that he can just send the city attorney an email asking for it. Kunselman says that he wants the outside bond counsel to put in writing that it agrees with the analysis – because he wants the outside bond counsel’s insurance to cover any errors and omissions. City attorney Stephen Postema says it would be a normal process to get that information as part of putting the property on the market. Kailasapathy says the council should be able to get the information directly. She wants the outside bond counsel to analyze the post-construction numbers.

10:32 p.m. Kailasapathy says we should not rush into selling the land, just in order to get this post-construction analysis. Postema reiterates that it would be a normal part of selling the property.

10:33 p.m. Briere says that now that she understands Kunselman’s motivation for wanting to list the land – and given that it’s clear he didn’t necessarily expect the land to be sold, she thinks it would be easy to vote it down.

10:36 p.m. Kunselman now adds that he brought up the issue because nobody else had brought it up. When he put it forward, community outcry had been heard and some of his colleagues had gotten cold feet. Instead of delaying the listing (as Anglin and Eaton’s resolution later in the meeting would do), he invited his colleagues to vote down the resolution. He’d still vote to list the property, however. Kunselman ventures that the Library Lane site has been an uncomfortable topic – and had caused people to lose elections. It doesn’t hurt to get the information and it doesn’t hurt to list the property for sale, Kunselman says.

10:38 p.m. Anglin wonders why they can’t just ask for the information. Kunselman says he’s not about to put millions of dollars to construct a park on the Library Lane site. There are other park needs – a tunnel to complete the Border to Border Trail, for example – that he would vote to spend money on before he’d spend money on a park on top of the Library Lane parking structure.

10:40 p.m. Kunselman says that through all this discussion, no one has talked about where the money is coming from to build a park on the Library Lot. By listing it for sale, it at least starts a conversation with someone who has some money, he says.

10:41 p.m. Kunselman is reviewing the DDA’s proposed budget and concludes that the DDA would not have money to put into it.

10:44 p.m. Taylor says he wants to provide some context. To look at the Library Lane site on its own is misleading, he says. The parking system as a whole generates revenues that are used to pay the debt, he says. The Library Lane parking structure had allowed tech companies to locate in the downtown and was a success by any rational measure, he says. Hieftje agrees with Taylor. Lumm says she voted for the resolution last time. She seems inclined to support it this time around.

10:45 p.m. Lumm is now talking about the resolution later on the agenda that would delay the listing. She says that’s also important.

10:47 p.m. Heiftje says he’ll vote for the resolution because he doesn’t see any other way to fund a plaza. Briere says she’ll vote for it because there’s an opportunity to amend it later on the agenda.

10:48 p.m. Outcome: The council has voted to affirm its vote from the last meeting over dissent from Kailasapathy, Lumm, Eaton, Anglin.

10:48 p.m. DC-1 Same-sex Marriage. This resolution asks that Michigan state officials stop opposing a recent court ruling that allows same-sex marriages. The ruling in question was issued by federal judge Bernard Friedman on Friday, March 21, 2014 in the case of Deboer v. Snyder. In that ruling, Friedman found that Article I, Section 25 of the Michigan Constitution – which limits the benefits of marriage to unions between one man and one woman – did not advance any legitimate state interest. So the ruling had the effect of making same-sex marriages legal in Michigan.

But the day following the decision, on March 22, the U.S. Court of Appeals for the Sixth Circuit issued a temporary stay on Friedman’s ruling. Michigan’s Gov. Rick Snyder and Attorney General Bill Schuette are appealing Friedman’s decision. [For more background, see Same-Sex Marriage above.]

10:49 p.m. Taylor is reviewing the content and background of the resolution.

10:51 p.m. Warpehoski echoes the thanks Taylor gave to Washtenaw County clerk Kestenbaum. He didn’t remember crying at his own wedding, but he’d cried at the weddings of some same-sex couples immediately after the Friedman ruling.

10:52 p.m. Lumm was pleased that it had been brought forward and was pleased to add her name as a co-sponsor.

10:52 p.m. Outcome: The council has voted unanimosuly to approve the resolution calling for state officials to stop opposing the Friedman ruling on same-sex marriage.

10:53 p.m. DC-2 Amended Main Street BIZ plan. This resolution would approve expansion of the geographic area of the Main Street Business Improvement Zone. The business improvement zone was established in 2010 by a vote of property owners in the zone to provide a mechanism for taxing themselves to pay for items like sidewalk snow removal, sidewalk sweeping and landscaping. For the expansion to be finalized it will need to be approved by property owners in the expanded district. [For more background, see Land: Main Street BIZ Expansion above.]

10:54 p.m. Taylor is reviewing the background. He encourages the council’s support.

10:56 p.m. Kailasapathy asks Ed Shaffran to the podium. She’s comparing the situation to Russia and Crimea. Shaffran explains that they’re following the state statute.

10:57 p.m. Kailsapathy says that the sidewalks on Main Street are wider than on Fourth Avenue. Shaffran ventures that the square footage of sidewalks might differ, but he alludes to 13 iterations to come up with an equitable approach.

10:58 p.m. Shaffran tells Kailasapathy that as a property owner on Main Street and on Fourth Avenue, he’s not hearing snow removal contractors say that they’d charge less to remove snow on Fourth Avenue.

11:02 p.m. Kailsapathy tells Shaffran that she’s weighing in on behalf of property owners who could not attend the meeting. Shaffran notes that the vote needs a 60% majority. Eaton asks what would happen if everyone in the existing BIZ voted for it and in the expanded zone voted against it – and Shaffran tells him it would fail. The new area is larger than the existing area.

11:02 p.m. Hieftje says he’ll vote for it. Warpehoski says he’ll vote for it because it’s an accessibility issue.

11:02 p.m. Outcome: The council has voted unanimously to approve the amended Main Street BIZ plan.

11:03 p.m. Recess. We’re now in recess.

11:12 p.m. We’re back.

11:12 p.m. DC-4 Amend March 17, 2014 resolution directing Library Lot to be listed for sale. This item revisits a March 17, 2014 resolution on listing the surface of the Library Lane structure for sale. Mike Anglin (Ward 5) and Jack Eaton (Ward 4) sponsored the item which delays the hiring of a broker and listing the property for sale until a public process, to be structured by the city administrator, is completed. That public process is supposed to allow discussion of the possibility that the entire surface of the underground parking garage could be used as a park or plaza. [For more background, see Land: Amendment to Library Lane Resolution to List for Sale above.]

11:15 p.m. The reconsidered resolution – to list the Library Lane development rights for sale – from the last meeting was approved (again) earlier tonight. This resolution would amend that resolution to delay the listing until after additional public process.

11:16 p.m. Anglin is giving the background on this proposal to amend the council’s previous resolution. This is to create something the entire city can be proud of, Anglin says.

11:20 p.m. Briere says that more than four years ago, she and Anglin and Kunselman were among those who’d requested that the task force reviewing the responses to the Library Lot RFP also consider those proposals that proposed public space. This resolution would allow the city administrator to structure a public process. She says if she had her way – which she ventured she would not – the city would bring in someone from the outside, because we as a community have become polarized, she says.

11:21 p.m. Briere will support this because having the community discussion is vital to having that public space work. If we don’t have community buy-in, it won’t be a successful space, whether there are eight votes or not, she says.

11:22 p.m. Hieftje is inviting Ault to the podium. He’s asking her to review the outreach that the downtown parks subcommittee had done. Ault, who is chair of the park advisory commission, also chaired that subcommittee.

11:25 p.m. Hieftje says it’s been going on for years. He calls it kicking the can down the road. He says there’s no way to build something on the Library Lane site without selling something. Hieftje highlights the part of the resolution that contemplates the use “in its entirety” of the surface as a public plaza. He calculates that this would entail throwing away $16 million. He says he’d prefer to spend a half million redeveloping Liberty Plaza. “I don’t understand it,” he says about the resolution.

11:27 p.m. Hieftje says that when a pretty narrow interest group wins, then maybe people will say that there’s been enough public process. Kunselman says he also won’t support the resolution. He says the public process described in the resolution could be done in parallel with listing the property for sale.

11:29 p.m. Kunselman says he’d support the resolution if the part about delaying the hiring of a broker were deleted. He says, “I’m not sellin’ without getting a 12,000 square foot plaza or public use space.” He also won’t support considering the entire parcel as a “commons.” Kunselman says that he’s had a conversation with a member of the Library Green Conservancy and that group is not behind this proposal, he says. That group had done its homework and worked to figure out what was possible.

11:30 p.m. Kunselman points out that a planter can get really heavy when it fills up with water.

11:32 p.m. Eaton notes that at the March 17 meeting, the library had asked the council to delay the resolution. And since that meeting, the planning commission had passed a resolution asking the council to use an RFP process. He felt there was still an interest among stakeholders in a continued conversation.

11:34 p.m. Petersen is asking Anglin and Eaton what they intend to happen.

11:35 p.m. She wants to know if the intent is to have a conversation with the stakeholders about keeping the entire site green. Yes, says Anglin.

11:38 p.m. Warpehoski says he can’t vote for this resolution at the same time he voted to accept the PAC recommendations that called for some kind of mixed use. This evening the council had thumbed its nose at the library but now is saying they need to be a partner. Warpehoski says Kunselman has this one right. He thinks that a sales agreement can have a rider agreement just like the former Y lot did. He thinks that the public process can unfold in a parallel way. Warpehoski ventures that there will be a “hot mess” discount when a developer thinks about trying to do business with the city.

11:39 p.m. Lumm says that Warpehoski is right about the conversation being a little bit weird. But she says that if you step back and think about it, it’s about making sure that the public has a chance to provide input.

11:42 p.m. Lumm says more discussion is not a terrible thing. Taylor agrees with Warpehoski’s point about voting for the PAC recommendations and voting for this resolution – that they’re inconsistent. Taylor says that Kunselman has it right – that we’ll see what a developer has to propose, quipping “whoever dares” to bid on the property.

11:44 p.m. Hieftje is suggesting some sort of compromise.

11:44 p.m. Recess. We’re now in recess so that councilmembers can figure out some compromise.

11:46 p.m. We’re back.

11:48 p.m. The council has essentially agreed to vote this down and possibly bring it back at a future meeting.

11:49 p.m. Outcome: The council has voted unanimously to reject the resolution that would have halted the listing of the Library Lane surface development rights for sale, until a public process has been completed.

11:49 p.m. DC-3 Library Lot sale proceeds. This resolution would direct the city administrator to allocate half the proceeds from a possible upcoming real estate sale to support affordable housing. The land in question is the surface of the Library Lane underground parking structure, which completed construction in the summer of 2012. [For more background, see Land: Library Lot Proceeds to Affordable Housing above.]

11:51 p.m. Briere is explaining the background of the resolution. She didn’t think the minimum 10% recommendation of the council’s budget committee over a year ago would be enough. She calls this as modest as possible – and made it 50%.

11:55 p.m. Eaton says that because we have no idea how much the property might sell for, he asks Briere if she would accept an amendment to say “up to 50%” – in case the property generated a greater-than-expected amount of money. Briere says if the property hypothetically generated a sale price of $15 million, she wouldn’t hesitate to put $7.5 million into the affordable housing trust fund.

11:56 p.m. Hieftje says that it would be a “game changer” to be able to work with Washtenaw County on the Platt Road property to develop affordable housing. There would be no harm done in passing this tonight. Taylor concurs with Hieftje that Ann Arbor needs more affordable housing and that’s a capital-intensive endeavor.

11:58 p.m. Taylor says that using the proceeds for affordable housing is consistent with a deeply held community value. Lumm says she supports the concept. She points out that this is what the council had done with the former Y lot. Earmarking half for affordable housing is not unreasonable, she says. But she questions why this decision needs to happen now. It makes more sense to not make this decision now. We should think this through in the context of all city council priorities, she says.

12:02 a.m. Kunselman echoes Lumm, saying that it’s counting our chickens before they hatch. This is not a binding resolution, he says. He ventures that the council won’t see a sale until at least next year, and many councilmembers here tonight won’t be here then. It would make a great statement, he says, but wouldn’t do much for what the council needs to focus on – working on the budget process. He wonders why some of this money would not go toward downtown beat cops.

12:03 a.m. Kailasapathy is focusing on the part of the resolution that puts the other half of the proceeds into the general fund. She wants to see the part of the proceeds not going to affordable housing to go toward capital investments.

12:04 a.m. City administrator Steve Powers ventures that it could be restricted as capital investments. Kailasapathy says she’s not sure if she wants to put in the energy to amend the resolution now, given that a sale is so far away.

12:05 a.m. Petersen says that even if it’s premature, that doesn’t mean it should be voted down. She wants to postpone it until after the budget is approved.

12:06 a.m. The postponement being discussed is until the first meeting in June. [The council ratifies the FY 2015 budget at its second meeting in May.]

12:07 a.m. Briere is arguing against the postponement by drawing a distinction between policy and budgeting.

12:08 a.m. Outcome: The council has voted to postpone the resolution allocating 50% of the net proceeds of a future Library Lot sale to the affordable housing trust fund. Dissenting were Briere, Taylor, Teall, Warpehoski, and Hieftje.

12:08 a.m. DB-1 Belle Tire ROW Vacation. The property owner has proposed that the city vacate the northern 7 feet of its right-of-way easement. In exchange, the property owner has offered to convey a non-motorized use easement over the same 7 feet. Such an easement would allow for this strip to be used by the public for future non-motorized transportation facilities, according to a staff memo. And as a non-motorized use easement, the 7-foot strip would be considered part of the required 10-foot front building setback. This resolution would approve that arrangement. [For more background, see Peds: Belle Tire Easement above.]

12:08 a.m. Outcome: The council has voted to accept the Belle Tire non-motorized easement.

12:09 a.m. DB-2 Request UM regents consider city land use recs. This resolution, which originated with the planning commission, recommends that the University of Michigan collaborate with the city of Ann Arbor on the future development of the former Edwards Brothers property at 2500-2550 South State Street, immediately adjacent to existing UM athletic facilities. The university is purchasing the 16.7-acre property, following the Ann Arbor city council’s decision on Feb. 24, 2014 not to exercise its right of first refusal to buy the site. [For more background, see Land: Recommendation to UM on Edwards Brothers above.]

12:10 a.m. Petersen said that when she heard the resolution was coming forward, she was eager to support it. She wished that the city had more leverage, which could have resulted from exercising the city’s right of first refusal on the property. The dialogue has been a long time coming.

12:11 a.m. Lumm said she also wished that the city had exercised its right of first refusal on the Edwards Brothers property. “Let the talks begin,” she says.

12:11 a.m. Outcome: The council has voted unanimously to approve the resolution asking UM regents to consider city planning documents as it plans the future of the former Edwards Brothers property on South State Street.

12:11 a.m. DS-1 Pedestrian safety task force funding resolution. This would appropriate $197,250 to fund the work of a pedestrian safety and access task force. It was postponed to tonight from the council’s March 3, 2014 meeting.That amount includes an “estimated $122,500” as the approximate cost of the anticipated city staff effort for the project. The total project budget includes $77,400 for a professional services agreement with Project Innovations Inc. to provide facilitation services. This item is expected to be withdrawn, and the city is putting the facilitator contract out for bid. [For more background, see Peds: Pedestrian Safety and Access Task Force above.]

12:12 a.m. Briere says she’d like to withdraw the resolution, saying that the staff memo makes it clear that no allocation needs to be made at this time. She gives an update on the first task force’s meeting.

12:13 a.m. Outcome: The resolution has been withdrawn.

12:14 a.m. Eaton raises the question of whether Briere can withdraw the resolution, given that it was placed on the agenda by staff.

12:15 a.m. Hieftje says he’s uncomfortable not voting on it.

12:16 a.m. So the council is now discussing the resolution. Lumm moves to table it. Warpehoski notes that a motion to table is not subject to debate.

12:19 a.m. Briere explains that her intent was not to prevent people from talking, but rather to save time, given that it was a null point. If the staff doesn’t need an allocation of funds, there’s no reason to allocate funds. Briere points to the memo from staff. Powers concurs that the resolution is no longer needed. Lumm withdraws her motion to table.

12:20 a.m. Kailasapathy questions why there’s an RFP being issued for the consultant.

12:22 a.m. Eaton says he’s troubled that the city is considering spending this much money on a consultant to support a task force.

12:24 a.m. Warpehoski is arguing for the need for the labor of a consultant.

12:28 a.m. Powers reminds the council that the $75,000 for sidewalk gaps was to prioritize gaps, not to install concrete. Lumm appreciates the fact that now an RFP is being issued.

12:39 a.m. Lumm is arguing against the resolution. Hieftje points out that those who moved the resolution also want to see it voted down. Kailasapathy asks why the city is hiring a consultant when it’s not clear what kind of consultant is needed. Teall doesn’t understand why Briere and Warpehoski – as the mover and seconder – want to see the resolution voted down. She thinks a task force should be supported. Warpehoski reviews the background. Teall ventures that it’s really all about Project Innovations. Many of the sanitary sewer wet weather citizens advisory committee members were satisfied with Project Innovations work on that project. When there were some complaints, they got a lot of traction, Teall said, and she wasn’t sure that was fair. Briere raises the point that many people objected to the fact that Project Innovations would have been given a no-bid contract.

12:40 a.m. Briere tells Teall that the task force doesn’t need an allocation of funds right now.

12:40 a.m. Outcome: The council votes unanimously to reject the resolution.

12:41 a.m. DS-2 Windemere Tennis Court contract with Nagle Paving Company. The council will consider a $134,297 contract with Nagle Paving Co. to relocate and rebuild the tennis courts at Windemere Park. [For more background, see Asphalt: Windemere Tennis Courts above.]

12:41 a.m. Lumm thanks staff and the neighbors who worked hard on it.

12:43 a.m. Taylor piles on with thanks to PAC, who listened and worked with the neighbors.

12:43 a.m. Outcome: The council has voted to to approve the Windemere tennis courts paving contract.

12:43 a.m. DS-3 Annual street resurfacing contract with Barrett Paving This resolution approves a construction contract to Barrett Paving Materials Inc. for $3.409 million for the 2014 street resurfacing program. [For more background, see Asphalt: Street Resurfacing Program above.]

12:43 a.m. Outcome: The council has voted to approve the annual street resurfacing contract.

12:44 a.m. DS-4 Annual sidewalk repair contract with Doan Construction Company. Part of the city’s sidewalk repair program involves outright replacement of sidewalk slabs. This resolution approves that contract with Doan Construction Company for $1,707,037. [For more background, see Peds: Sidewalk Maintenance Program above.]

12:45 a.m. Outcome: The council has voted to approve the annual sidewalk repair contract.

12:45 a.m. DS-5 Annual sidewalk cutting contract with Precision Concrete Cutting. Some sidewalk slabs are in reasonably good shape but are out of alignment with adjacent slabs. The city takes the approach of shaving the portion that’s out of alignment so that it’s flush. This resolution approves the contract for the cutting work for the upcoming 2014 program is to be awarded to Precision Concrete Cutting for $207,350.

12:45 a.m. Outcome: The council has voted to approve the annual sidewalk cutting contract.

12:46 a.m. Communications from the council. Warpehoski thanks the Veg Week sponsors for bringing food. He mentions that the rules committee is looking at an ethics policy that might also include a gift acceptance policy.

12:48 a.m. Kunselman is quoting out a correction made in The Ann Arbor Observer, that vindicates statements by him and Kailsasapathy in a December 2013 article and apologizes to him. “Apology accepted,” Kunselman says.

12:53 a.m. Kunselman is quoting out incident reports from the AADL that documented heroin overdoses at the downtown location. Kunselman says he’d asked the city administrator to find out what exactly is going on. He says he hasn’t seen anything about arrests being made. He wonders why someone who ODs and survives is not prosecuted and why the dealers are not tracked down and prosecuted. Hieftje ventures that the police might be pursuing this matter “quietly.” Kunselman doesn’t agree with that approach. Warpehoski says that he’s inquired with Jim Balmer of Dawn Farms and the indication was that treatment is an appropriate response to addiction. Kailasapathy says that this doesn’t apply to those who are peddling the drugs.

12:54 a.m. Briere says that Kailasapathy is right, but that it can take time to develop a case against a drug dealer.

12:55 a.m. Clerk’s report of communications, petitions and referrals. Outcome: The council has accepted the clerk’s report.

12:55 a.m. Public comment general time. There’s no requirement to sign up in advance for this slot for public commentary.

12:56 a.m. Stefan Trendov says that in all the time he’s watched the council, he thinks that the councilmembers are finally talking to each other. They’re going in a good direction and he wishes them a good night.

12:58 a.m. Kai Petainen says that he wants the Ann Arbor station study process to be transparent. He says that a label on one of the maps covers up green dots that show areas of environmental concerns near the Fuller Road site. He wants maps that don’t look like marketing materials, he says.

1:02 a.m. Alan Haber says he’s sat through the deliberations and gives them great honor for persevering through all the detail. He’s always considered the whole surface of the Library Lot parking structure as a community space. He objects to the characterization of his group as a narrow interest group.

1:04 a.m. Odile Hugonot-Haber expresses disappointment at the council’s decisions on the Library Lot. She reports that she’s heard about a greenbelt property that sold its development rights for mineral extraction through fracking.

1:07 a.m. Caleb Poirer says that he was impressed with the patience that councilmembers had shown each other tonight. He thanks the attendees of the March 17 meeting on homelessness. He was moved by Briere’s point that affordable housing is a priority, but not a funded one. He tells the story of “Million-Dollar Murray.” Sometimes affordable housing reduces the need for policing.

1:08 a.m. Hieftje asks Powers if new mics can be purchased – as they generate a fair amount of static.

1:09 a.m. Closed session. The council is going into closed session to discuss pending litigation.

1:25 a.m. We’re back.

1:25 a.m. Adjournment. We are now adjourned. That’s all from the hard benches.

A sign on the door to the Ann Arbor city council chambers gives instructions for post-meeting clean-up.

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Screenshot of Legistar – the city of Ann Arbor’s online agenda management system. Image links to the April 7, 2014 meeting agenda.

The council’s April 7 agenda features two significant items of old business: a first reading of an ordinance that would regulate outdoor smoking in certain locations; and an allocation of funds for the work of a pedestrian safety and access task force.

[Updated 5 p.m. April 4, 2014. The pedestrian safety task force funding resolution is now expected to be withdrawn. At the first meeting of the task force, held on Friday, April 4, Ward 1 councilmember Sabra Briere, speaking from the audience, told the group that it was her intent to withdraw the funding resolution when the council meets on April 7. Withdrawing the resolution at the April 7 meeting would not mean that the task force will not be able to do its work. Details are included after the jump.]

Pedestrian issues form one of the themes of the meeting agenda – as the council will be approving annual contracts for the sidewalk repair program, as well as applying for a grant to renovate the pathway in Gallup Park – from the Geddes Dam at the east end of the Gallup Park pathway, to the parking lot east of Huron Parkway. Along with the sidewalk maintenance program contracts, the city council will also be asked to approve the annual street resurfacing program contracts.

Another main theme of the meeting is land use. Carried over as a topic from the council’s March 17 meeting is the surface of the city-owned Library Lane underground parking structure in downtown Ann Arbor. After voting on March 17 to hire a real estate broker, the council will consider a resolution on April 7 that would allocate to the city’s affordable housing trust fund half of the proceeds of any sale of the site’s development rights.

But on April 7 the council will also be considering an amendment to the March 17 resolution that directed the city administrator to list the surface of the Library Lane parking structure for sale. The amendment would require a public process to take place before brokerage services are obtained or the real estate is listed for sale. That public process is supposed to allow discussion of the possibility that the entire surface of the underground parking garage could be used as a park or plaza. The amendment is sponsored by Mike Anglin (Ward 5) and Jack Eaton (Ward 4).

The council will also be considering three items that arrived on its agenda via the city’s planning commission: rezoning of a nature area to PL (public land); approval of a site plan for the gym expansion at Concordia University [now expected on the April 21 meeting agenda]; and a resolution calling on the University of Michigan to incorporate the city’s land use recommendations as it considers the future use of the Edwards Brothers property on South State Street.

In other business, the council will be considering a resolution to approve an expansion of the Main Street business improvement zone (BIZ). The geographic area of the self-assessment district – which handles sidewalk snow removal, sweeping and other upkeep for property owners – would more than double. The final decision rests with the property owners in the expanded area.

Also at its April 7 meeting, the council will consider a resolution asking that Michigan state officials stop opposing a recent court ruling that allows same-sex marriages.

The council’s agenda also includes several street-closing approvals for upcoming events: Taste of Ann Arbor on June 2; The Event on Main Street on June 19; the Ann Arbor Jaycees Fourth of July Parade on July 4; and the Townie Street Party on July 14.

Among the reports and communications attached to the agenda is the final report of a council economic collaborative task force.

This article includes a more detailed preview of many of these agenda items. More details on other agenda items are available on the city’s online Legistar system. The meeting proceedings can be followed Monday evening live on Channel 16, streamed online by Community Television Network starting at 7 p.m.

Outdoor Smoking

A new local law regulating smoking in some outdoor locations will be given a first reading by the council for the third time at its April 7 meeting. The law would regulate smoking outside of public buildings and also potentially in areas of some city parks.

The most recent action – to postpone the ordinance until April 7 – came at the council’s March 3, 2014 meeting. The new ordinance had also been postponed at the council’s Feb. 3 meeting.

Chuck Warpehoski (Ward 5), sponsor of the proposed new local law, had appeared before the city’s park advisory commission on Feb. 25, 2014 to brief commissioners on the proposal and solicit feedback.

Made punishable under the proposed ordinance through a $50 civil fine would be smoking within 20 feet of: (1) bus stops; (2) entrances, windows and ventilation systems of the Blake Transit Center; and (3) entrances, windows and ventilation systems any city-owned building.

The ordinance would also authorize the city administrator to have signs posted designating certain parks or portions of parks as off limits for outdoor smoking, and to increase the distance from entrances to city buildings where outdoor smoking is prohibited.

Where no signs are posted noting the smoking prohibition, a citation could be issued only if someone doesn’t stop smoking immediately when asked to stop.

An existing Washtenaw County ordinance already prohibits smoking near entrances, windows and ventilation systems, according to the staff memo accompanying the resolution – but the county’s ordinance can be enforced only by the county health department. The memo further notes that the Michigan Clean Indoor Air Act does not regulate outdoor smoking.

At the council’s March 3 meeting, other councilmembers expressed concern about the potential disparate impact of such a law on the homeless, and the challenge of enforcement.

Peds: Pedestrian Safety and Access Task Force

At its April 7 meeting, the council will consider for the second time a resolution that would appropriate $197,250 to fund the work of a pedestrian safety and access task force. Action to postpone the resolution until April 7 came at the council’s March 3, 2014 meeting.

The total amount proposed to be appropriated for the task force project budget is $197,250. That amount includes an “estimated $122,500” as the approximate cost of the anticipated city staff effort for the project. The total project budget includes $77,400 for a professional services agreement with Project Innovations Inc.

The funds are to be sourced in part from an allocation made during the May 20, 2013 budget deliberations, which appropriated $75,000 for a study to prioritize sidewalk gap elimination. The connection between sidewalk gaps and the task force’s work is based in part on one of the other “resolved” clauses establishing the task force: “… the task force will also address sidewalk gaps and create a tool for setting priorities for funding and filling those gaps; …”

The pedestrian safety and access task force was established through a council resolution passed on Nov. 18, 2013. Confirmed as members of the task force on Jan. 21, 2014 were: Vivienne Armentrout, Neal Elyakin, Linda Diane Feldt, Jim Rees, Anthony Pinnell, Sarah Pressprich Gryniewicz, Kenneth Clark, Scott Campbell, and Owen Jansson.

Another key “resolved” clause establishing the group’s scope of work includes the following: “… the task force will explore strategies to improve pedestrian safety and access within a framework of shared responsibility through community outreach and data collection, and will recommend to council improvements in the development and application of the Complete Streets model, using best practices, sound data and objective analysis.”

The responsibilities of the task force include delivery of a report a year from now – in February 2015.

The funding for the task force is in part to be used to pay for a $77,400 contract with Project Innovations Inc. to provide facilitator support to the task force.

According to a staff memo written in response to councilmember questions, the facilitator would assist with an anticipated 18 task force meetings, 24 resource group (staff) meetings, five stakeholder meetings and three public meetings. The facilitator would be “preparing materials and agendas; facilitating the meetings; summarizing the meetings; facilitating communication and discussions between, and among, the task force members and the resource group; and, developing materials for community outreach in addition to the actual public meetings, including content for press releases and web page publishing, and a community survey.”

According to the staff memo, a “team of staff members has identified Project Innovations, Inc. as a firm in the region that has demonstrated skill in task force facilitation and robust community engagement efforts, and is uniquely qualified with the capacity to facilitate the pedestrian safety and access task force’s rigorous work approach within the specified timeframe.” Based on the phrasing in the memo, the work appears not to have been put out to bid and Project Innovations was identified as a “sole source” provider.

Project Innovations is the same firm currently providing facilitation support to a citizens advisory committee that is attached to a sanitary sewer wet weather evaluation study being conducted by the city.

The resolution establishing the task force does not explicitly charge the group with a review of the city’s crosswalk law. But the pedestrian safety task force was established in the same time frame as the council was considering an amendment to the city’s crosswalk law. The council ultimately voted to change the language of that law at its Dec. 2, 2013 meeting – so that motorists were required to concede the right-of-way only to pedestrians who had already entered the crosswalk.

That change was subsequently vetoed by mayor John Hieftje. Drawing on the phrasing used in Hieftje’s statement of veto, Stephen Kunselman (Ward 3) has indicated he intends to bring forward an amendment that would require motorists to stop at crosswalks for pedestrians only if “they can do so safely.” At the council’s Feb. 18, 2014 meeting, Kunselman announced he’d be pursuing such an amendment.

The council’s April 7 deliberations on the funding of the task force could be impacted by the first meeting of the task force, which is scheduled for April 4. Based on the agenda for that first task force meeting, recommendations on the funding question could come from the task force to the council to consider on April 7. Indications at the March 3 council meeting were that the budget for the task force and the scope of work for the staff and consultant support could change considerably.

[Updated 5 p.m. April 4, 2014]  The funding resolution is now expected to be withdrawn. At the first meeting of the task force, held on Friday, April 4, Ward 1 councilmember Sabra Briere, speaking from the audience, told the group that it was her intent to withdraw the funding resolution when the council meets on April 7.

Withdrawing the resolution at the April 7 meeting would not mean that the task force will not be able to do its work. Here’s why. In the resolution that’s expected to be withdrawn, the total amount proposed to be appropriated for the task force project budget is $197,250. That amount includes an “estimated $122,500” as the approximate cost of the anticipated city staff effort for the project. The total project budget includes $77,400 for a professional services agreement with Project Innovations Inc.

So the portion of the project budget that requires hard costs to be covered – other than city staff time – is the cost for the consultant to provide facilitation services. And according to a staff memo to the city administrator written after the council’s action to postpone, the bulk of the cost can already be covered in an existing budget allocation. From the March 27, 2014 staff memo to the city administrator: “The estimated amount for the facilitation work is $70,000 to $90,000. Of this amount, $75,000 is currently budgeted for pedestrian safety and sidewalk-gap planning. The remaining $15,000 will be included in the City Administrator’s recommended FY 14 budget amendment.”

In addition to authorizing the funding, the resolution would authorize a $77,400 contract with Project Innovations for the facilitation work. But now, it’s not clear that particular consultant will be selected for the work. Originally Project Innovations had been identified by staff as a contractor uniquely qualified to do the facilitation work. Project Innovations is familiar to city staff as the facilitator for a sanitary sewer wet weather evaluation study the city is currently conducting. But now the city has decided to issue an RFP for the facilitation work. [.pdf of RFP No. 893] Responses to the RFP are due by April 22, 2014.

At the April 4 task force meeting, Connie Pulcipher – a systems planner with the city of Ann Arbor – told members of the task force that they could be involved in the process of interviewing respondents to the RFP. The delay in selecting a facilitator means that the original timeline for the group’s work, which included a final report by February 2015, has shifted to around August 2015.

Peds: Belle Tire Easement

On the council’s agenda is approval of an easement related to the Belle Tire site plan at State and Ellsworth. The planning commission recommended approval at its March 18, 2014 meeting.

Aerial view of a proposed Belle Tire site.

The site plan itself was recommend for approval by the commission at its Aug. 20, 2013 meeting, and the project subsequently received city council approval on Oct. 7, 2013. The site is located in Ward 4.

By way of background, a 50-foot-wide right-of-way easement on the front this site was recorded by the city as part of a previously approved land division for this parcel. That easement reduced the front setback of the Belle Tire building from 10 feet to roughly 3 feet. The minimum front setback for this site is 10 feet.

So the property owner, who also owns the adjacent site at 3975 S. State, has proposed that the city vacate the northern 7 feet of its right-of-way easement.

In exchange, the property owner has offered to convey a non-motorized use easement over the same 7 feet. Such an easement would allow for this strip to be used by the public for future non-motorized transportation facilities, according to a staff memo. And as a non-motorized use easement, the 7-foot strip would be considered part of the required 10-foot front building setback.

Peds: Gallup Park Path

On the council’s consent agenda – a group of items voted on all-in-one-go – is approval of a grant application to fund renovations to a pathway that runs through Gallup Park, which is part of the Border to Border Trail (B2B) connecting the eastern and western borders of Washtenaw County. Renovations would include repairs to the existing asphalt, as well as widening to 10 feet – in part to meet current American Association of State Highway and Transportation Officials (AASHTO) standards.

The grant application would be made to SEMCOG (Southeast Michigan Council of Governments) and MDOT (Michigan Dept. of Transportation) for the Transportation Alternatives Program (TAP). The grant funds, if awarded, would fund renovation of the pathway from the Geddes Dam at the east end of the Gallup Park pathway, to the parking lot east of Huron Parkway. The work would include the loop that leads around that part of the park. Total length of the pathway to be renovated is about two miles.

The city would provide a grant match of $200,000, which would be paid out of the parks and recreation capital improvements millage.

Peds: Sidewalk Maintenance Program

Also related to pedestrian issues are two contracts related to the annual sidewalk maintenance and repair program, which is funded out of a five-year millage approved by voters in November 2011.

A sidewalk marked with a “C” – which indicates that it needs to be cut flush – on Fifth Avenue south of William Street.

Some sidewalk slabs are in reasonably good shape but are out of alignment with adjacent slabs. The city takes the approach of shaving the portion that’s out of alignment so that it’s flush.

Cutting the concrete is more cost effective than replacing the entire slab. The contract for the cutting work for the upcoming 2014 program is to be awarded to Precision Concrete Cutting for $207,350.

The other part of the program involves outright replacement of sidewalk slabs.

That contract is to be awarded to Doan Construction Company for $1,707,037.

Areas of the city of Ann Arbor where sidewalk repair will be done in 2013 and 2014.

Asphalt: Street Resurfacing Program

In addition to an annual sidewalk repair program, the city manages an annual street resurfacing program. On the council’s April 7 agenda is the award of a construction contract to Barrett Paving Materials Inc. for $3.409 million for the 2014 program. Also on the agenda is a professional contract for materials testing – with CTI and Associates Inc. for $82,332.

Heavy black highlights indicate stretches of road that are a part of the city of Ann Arbor’s street resurfacing program in 2014.

Text descriptions of the streets to be resurfaced are as follows:

• Washington: First Ave to Fourth Ave (April – May)
• Fuller: Maiden Lane to Huron River Bridge (May – June)
• Newport: Sunset to south of Bird Rd (June – July)
• Linwood:, Doty to Wildwood (April – May)
• Northside Grill Alley: Broadway to End (April – May)
• Vinewood: Berkshire to Avon (May – June)
• Steeplechase: Whiltshire to Blaney (June – July)
• St. Aubin: Platt to Creek Dr (June – July)
• Woodbury: Astor to Stadium (July – July)
• Prairie: Plymouth to Aurora (July – August)
• Burlington Court: Burlington to End (July – August)
• Waldenwood & Adjacent Courts: Penberton to Earhart (north end) (July – September)

Asphalt: Windemere Tennis Courts

The council will consider a $134,297 contract with Nagle Paving Co. to relocate and rebuild the tennis courts at Windemere Park. The park advisory commission recommended approval of the contract at its Feb. 25, 2014 meeting.

PAC’s recommendation on the contract followed its approval on Jan. 28, 2014 of a revised new location for tennis courts at Windemere Park, on the city’s northeast side. The final location approved by PAC was one put forward at a public meeting earlier this year.

The new location for the tennis courts has been disputed among neighbors who live near Windemere Park, a nearly four-acre parcel north of Glazier Way between Green and Earhart roads. The tennis courts there have deteriorated, and the city has been looking at options for replacing them. Neighbors had originally advocated keeping the courts in the same location, but the soil there is unstable. Before the area was developed, the current location of the courts was a pond.

Nagle Paving was the lowest of five responsible bidders on the project, according to a staff memo. Including a 10% construction contingency, the entire project budget is $147,727. Funding will come from the FY 2014 park maintenance and capital improvement millage revenues. [.pdf of staff memo and resolution] [.pdf of cost comparison chart]

Land: Library Lot Proceeds to Affordable Housing

The city council will consider a resolution at its April 7 meeting that would direct the city administrator to allocate half the proceeds from a possible upcoming real estate sale to support affordable housing. The land in question is the surface of the Library Lane underground parking structure, which completed construction in the summer of 2012. [.pdf of draft resolution on Library Lane sale]

The Library Lane underground parking deck is highlighted in yellow. The name “Library Lane” is based only on the proximity of the structure to the downtown location of the Ann Arbor District Library. The library does not own the structure or the mid-block cut-through. (Base image from Washtenaw County and City of Ann Arbor GIS services.)

From the resolution: “Resolved, That City Council direct the City Administrator to allocate 50% of any and all proceeds, after fees and closing costs, from the sale of development rights at 319 S. Fifth Avenue [the Library Lane lot] to the affordable housing fund.” Use of money in the city’s affordable housing trust fund is subject to recommendations by the housing and human services advisory board (HHSAB).

Based on a ballpark estimated value for the property of $6-7 million dollars – given by Jim Chaconas of Colliers International at the council’s March 17, 2014 meeting – the resolution would translate to somewhere in the neighborhood of $3 million to support affordable housing, depending on fees and closing costs.

No specific deal appears to be in the offing to develop the top of the structure. But the council voted at its March 17, 2014 meeting to hire a brokerage service to list the development rights to the top of the underground parking garage for sale. At the same meeting, the council passed a separate resolution that reserved 6,500-12,000 square feet on the Library Lane site for a publicly owned urban park.

The resolution allocating 50% of proceeds of a Library Lane sale to support affordable housing is sponsored by four councilmembers: Sabra Briere (Ward 1), Christopher Taylor (Ward 3), Chuck Warpehoski (Ward 5) and mayor John Hieftje.

The strategy of channeling at least some of the proceeds of land sales to support affordable housing efforts has been a consistent part of city policy dating back several years. However, the council has not always agreed on the portion of a sale that should be allocated to support affordable housing. At the March 16 Sunday night caucus, Briere indicated one reason she might be reluctant at the following evening’s council meeting to support the hiring of a broker to list the Library Lane development rights for sale: She did not at that time want to take on the fight with other councilmembers about what to do with the proceeds. But Briere voted with seven of her colleagues on the 8-1 vote that saw only Sumi Kailasapathy (Ward 1) dissenting. Sally Petersen (Ward 2) and Margie Teall (Ward 4) were not present for that vote.

The sale of another city property – the former Y lot in downtown Ann Arbor, on William between Fourth and Fifth avenues, across the street from the Library Lane site – is expected to generate roughly $1.4 million in net proceeds from the $5.25 million purchase price. That sale to hotelier Dennis Dahlmann had a closing date of April 2, 2014. And that sale was, in fact, completed.

The council voted at its Dec. 16, 2013 meeting to allocate all of those net proceeds to the affordable housing trust fund. More recently, at its March 3, 2014 meeting, the council directed the city administrator to prepare a budget resolution that would – upon completion of the former Y lot sale – allocate $600,000 from the affordable housing trust fund to the Ann Arbor Housing Commission, to support major capital improvements to its properties.

More than a year ago, at its Oct. 15, 2012 meeting, the council adopted a general policy on proceeds of land sales that was based on a budget committee recommendation. Essentially the policy is to consider land sales on a case-by-case basis, considering all the needs of the city. A nod to affordable housing was included in an amendment added at the council meeting in the form of a statement that all needs of the city would be considered in deciding the use of land sale proceeds – but “especially the need for affordable housing.”

The draft resolution to be considered at the April 7 council meeting cites the budget committee’s recommendation, which was adopted in the Oct. 15, 2012 council resolution, that “no less than 10% of net proceeds of any sale will be allocated and distributed to the affordable housing trust fund …”

Land: Amendment to Library Lane Resolution to List for Sale

On April 7, the council will also be revisiting the March 17 resolution on listing the surface of the Library Lane structure for sale. Mike Anglin (Ward 5) and Jack Eaton (Ward 4) have sponsored a resolution that would delay the hiring of a broker and listing the property for sale until a public process, to be structured by the city administrator, is completed.

That public process is supposed to allow discussion of the possibility that the entire surface of the underground parking garage could be used as a park or plaza. From the resolution:

Resolved, That Resolution R-14-098 Directing the City Administrator to List for Sale 319 South Fifth and Retain Estate Brokerage Services be amended to direct the City Administrator to require that retention of brokerage services be delayed and listing not occur until adequate public process has taken place to explore public uses for the entire property;

Resolved, That the City Administrator structure the public process to allow citizens an opportunity to bring forward and discuss any and all appropriate public uses for this City-owned property, including its use, in its entirety, as a park or plaza;

Resolved, That City Administrator schedule a public hearing as part of the public process for citizen input on public uses for the property

Resolved, That City Administrator provide City Council with report on the public process at its completion; and

Resolved, On completion of the required public process, the City Administrator is directed to seek further direction from City Council as to whether the property should be listed or to continue to develop a wholly public or mixed public/private plan for its use.

The vote on the council’s March 17 resolution was 8-1, with dissent only from Sumi Kailasapathy (Ward 1). Sally Petersen (Ward 2) was absent from the start of the meeting and Margie Teall (Ward 4) departed late in the meeting but before the vote was taken.

The April 7 council agenda also includes, as an item of communication, a resolution passed by the city planning commission on March 18, 2014 that gives advice to the council about how to develop the Library Lane property. The commission’s recommendations focused on conditions for developing the site that would garner economic benefits to the city, such as a mixed-use development that generates foot traffic, with an entry plaza or open space and a design that “creates an iconic addition to the skyline.” The recommendations drew on material in several existing documents, including the Connecting William Street report that was completed by the Ann Arbor Downtown Development Authority about a year ago.

Also attached to the council agenda as an item of communication is a resolution passed by the Ann Arbor District Library board on March 17, 2014. The resolution asked the council to reject designating a portion of the city-owned Library Lane site – which is adjacent to the downtown library – as a public park or plaza at this time.

Land: Recommendation to UM on Edwards Brothers

An additional land-use item on the council’s April 7 agenda is a resolution recommending that the University of Michigan collaborate with the city of Ann Arbor on the future development of the former Edwards Brothers property at 2500-2550 South State Street, immediately adjacent to existing UM athletic facilities. The university is purchasing the 16.7-acre property, following the Ann Arbor city council’s decision on Feb. 24, 2014 not to exercise its right of first refusal to buy the site.

The city planning commission passed the same resolution at its March 18, 2014 meeting and forwarded it to the city council.

The resolution was drafted by planning manager Wendy Rampson based on previous discussions by the planning commission and city council. [.pdf of resolution as amended at March 18 planning commission meeting]

The one resolved clause states:

RESOLVED, That the Ann Arbor City Council and Ann Arbor City Planning Commission request that The Regents of The University of Michigan and President authorize University staff to meet with City representatives to collaborate on issues related to future development of the South Athletic Campus area, including, but not limited to:

• Exploring the creation of one or more parcels fronting South State Street to be developed, preferably privately, for complementary uses adjacent to the South Athletic Campus that also follow the South State Street plan recommendations;
• Discussing options for the relocation of park-and-ride facilities as the South Athletic Campus develops; and
• Discussing the opportunities for a future pedestrian and vehicular connection between South Main Street and South State Street via the planned Oakbrook Drive extension through the South Athletic Campus site.

At the planning commission’s March 18 meeting, Rampson said she’s already shared a draft of the resolution with UM planner Sue Gott and Jim Kosteva, the university’s director of community relations.

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

Land: Stapp Nature Area Addition Rezoning

The council’s April 7 agenda includes a resolution giving initial approval to rezoning of land that’s been donated to the city by developer Bill Martin, founder of First Martin Corp. The 2.2-acre parcel at 3301 Traverwood Drive is being added to the adjacent Stapp Nature Area, near the Leslie Park golf course.

Land donated by Bill Martin to the city of Ann Arbor indicated in red outline..

City staff recommended that the donated parcel be rezoned from R4D (multi-family dwelling) to PL (public land). The land reaches from Traverwood Drive to the Leslie Park golf course, south of Huron Parkway. Adding the land expands a corridor of natural areas and parkland. Stapp Nature Area, a 8.11-acre property with a mature native forest and small vernal pool, is adjacent to Tuebingen Park and has a connection to Leslie Woods.

The site is on the northern edge of a larger property that’s being developed by First Martin Corp. as Traverwood Apartments. That project received its final necessary approvals from the city council on Jan. 6, 2014.

First Martin has committed to creating a pedestrian access from the apartment complex to the nature area, which will be formalized with an access easement.

The city has a policy of rezoning city-owned land to PL (public land). This parcel will be differentiated as parkland by its inclusion in the city’s parks and recreation open space (PROS) plan, because it will become part of the Stapp Nature Area, which is already in the PROS plan.

The council would be giving the rezoning initial approval at its April 7 meeting. The final vote would come at a future meeting after a public hearing.

Land: Concordia University Gym Expansion

An additional land-use issue that appears was expected on the city council’s April 7 agenda is approval of a site plan to expand the existing Concordia University gym.

Corrected: This item is now expected to be considered at the council’s April 21 meeting. 

The plan also includes reconfiguring nearby parking lots and stormwater management features on the 187-acre site at 4090 Geddes Road, just west of US-23 and north of the Huron River. The city planning commission recommended approval of the site plan at its March 4, 2014 meeting.

Aerial view of Concordia University campus, south of Geddes Road and west of US-23.

As a separate item, planning commissioners were asked to grant a special exception use for the project. That’s required because the private university is located on a site zoned R1B (single-family residential district).

The site plan requires city council approval, but the special exception use does not.

The proposal calls for a three-story, 34,391-square-foot addition to the current 22,021-square-foot gym that was built in the early 1960s, located on the west side of Concordia’s main campus. [.pdf of campus map] The addition will include men’s and women’s locker rooms, athletic office space, classrooms and an auxiliary gym. A second phase of the project entails constructing a single-story, 5,280-square-foot athletic training room.

An existing gravel parking area west of the gym will be paved and landscaped, and another lot north of the gym along Geddes will get new landscaping and bioswales. A total of 92 new parking spaces will be created, mostly in the former gravel lot. A new stormwater management system will be completed to address a 100-year storm event, including a detention pond with an outlet into a bioswale south of the developed area.

The site plan is for a planned project, which allows variations in height and placement. The proposed addition would be 39 feet high. The site’s zoning has a height limit of 30 feet. The existing gym is about 33 feet high, measured at the midpoint of the roof.

Land: Main Street BIZ Expansion

On the council’s April 7 agenda is approval of an expansion of the geographic area of the Main Street Business Improvement Zone. The business improvement zone was established in 2010 by a vote of property owners in the zone to provide a mechanism for taxing themselves to pay for items like sidewalk snow removal, sidewalk sweeping and landscaping. [For the state enabling legislation for a BIZ, see Public Act 120 of 1961]

The current geographic area of the Main Street BIZ extends north-to-south from William to Huron on both sides of Main Street, extending to the mid-block alleys. The expansion would extend the area westward by a half block from the alley to Ashley Street. The expansion would also extend the area eastward by a half block along the whole north-south dimension; and between William and Liberty, the zone would expand westward an additional block – to Fourth Avenue.

While the council must give its approval of the plan, the expansion is contingent on a vote among property owners in the area, which has to be set for no later than 49 days after the date of the council’s resolution. The council’s April 7 meeting agenda includes a public hearing on the issue.

Main Street BIZ geographic area and expansion. (Map by The Chronicle from the BIZ plan using Washtenaw County and city of Ann Arbor GIS services mapping tools.)

Same-Sex Marriage

At its April 7 meeting, the Ann Arbor city council will consider a resolution asking that Michigan state officials stop opposing a recent court ruling that allows same-sex marriages. [.pdf of draft resolution on same-sex marriage]

The ruling in question was issued by federal judge Bernard Friedman on Friday, March 21, 2014 in the case of Deboer v. Snyder. In that ruling, Friedman found that Article I, Section 25 of the Michigan Constitution – which limits the benefits of marriage to unions between one man and one woman – did not advance any legitimate state interest. So the ruling had the effect of making same-sex marriages legal in Michigan.

But the day following the decision, on March 22, the U.S. Court of Appeals for the Sixth Circuit issued a temporary stay on Friedman’s ruling. Michigan’s Gov. Rick Snyder and Attorney General Bill Schuette are appealing Friedman’s decision.

The council’s resolution reads in part:

RESOLVED, That the Ann Arbor City Council urges Governor Snyder and Attorney General Schuette to immediately suspend all efforts to appeal or otherwise contest Judge Friedman’s Ruling…

Before the stay on Friedman’s ruling took effect, Washtenaw County clerk Larry Kestenbaum opened his office for business on Saturday, March 22, and issued 74 marriage licenses for same-sex couples in Washtenaw County. The county board had already set the stage for those couples to receive what practically amounts to a fee waiver for the expedited processing of a license, which ordinarily takes three days. The “fee” approved by the board at its Feb. 19, 2014 meeting reduced the usual fee from $50 to 1 cent.

The resolution passed by the county board on Feb. 19 allows the county clerk, consulting with the county administrator, to establish a “fee holiday” on the day preceding a period during which the office’s vital records division would be closed for four or more days, or when an unusual number of marriage license applicants are expected to appear. During a “fee holiday,” the charge for immediately processing a marriage license is 1 cent.

The resolution to be considered by the Ann Arbor city council on April 7 currently has four sponsors: Christopher Taylor (Ward 3), Margie Teall (Ward 4), Sabra Briere (Ward 1) and Chuck Warpehoski (Ward 5).

Economic Collaborative Task Force

Among the many agenda attachments – reports and communications – is the final report of the economic collaborative task force, established by the council last year at its May 20, 2013 meeting. The idea to establish the task force had grown out of an idea to review the Ann Arbor Downtown Development Authority in the context of proposed changes to the city ordinance governing the DDA. The task force drew members from city of Ann Arbor, Ann Arbor SPARK and the Ann Arbor DDA.  [.pdf of March 28, 2014 economic collaborative task force report]

In more detail, the task force was supposed to do the following:

• Provide clarity, alignment and specificity on economic development policy and objectives for fiscal year 2014 toward accomplishing city council’s success statement for Economic Development.
• Provide for strategic alignment of priorities between the Task Force member entities.
• Highlight cost sharing and maximizing of resource utilization.
• Identify options for sustaining, modifying, or eliminating operations in a financially-responsible manner through efficiencies and/or partnerships as part of a cohesive economic development plan for the city.

The “success statement” mentioned in the resolution was crafted by the city council at a budget retreat held in late 2012.

Those initially appointed to represent the city on the task force were city administrator Steve Powers, Sally Petersen (Ward 2) and then councilmember Marcia Higgins (Ward 4).

According to the resolution establishing the task force, a report was supposed to be presented to the council in December 2013 and the task force was supposed to expire at the end of 2013.

The 4.5-page report in general calls on the city, the Ann Arbor Downtown Development Authority and Ann Arbor SPARK to continue existing initiatives.

Some highlights of the report include a recommendation that the city consider technology infrastructure that is “essential for companies to compete globally and for communities to attract the necessary talent.” In that category of infrastructure, the report indicates that the city and Ann Arbor SPARK should “continue their work to develop a proposal for high-speed fiber that would accelerate both commercial and residential internet speeds.”

Also recommended in the report is the preparation of a plan to market and sell surplus city-owned properties. Properties included on the list include the South Ashley/West William (Kline) lot, the South Main/East William (Palio) lot, Library Lane, and 415 W. Washington.

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Illustration by The Chronicle, based on bar chart in a preliminary draft report of a fall 2013 National Citizens Survey conducted among Ann Arbor residents.

Councilmembers have been asked to prepare for the session by thinking about Ann Arbor’s “brand.” Specifically, they’ve been asked to reflect on what “differentiates Ann Arbor from other communities in Michigan” and what “makes Ann Arbor a truly special community to live, work and play.”

Councilmembers will be asked to spend about five minutes each at the start of the session talking about how they see the Ann Arbor “brand.”

The facilitator for the session is Julia Novak of the Novak Consulting Group. In advance of last year’s session, she asked councilmembers to prepare by formulating thoughts that could be summarized as “What I Believe.”

Last year’s homework assignment was, I think, easy compared to this year’s. And I do not envy councilmembers this chore. It sounds hard. I wouldn’t know where to begin. Anytime somebody starts talking about “brands” – especially a brand for a city – my first thought is: “Why, you sound like a charlatan standing there talking to me; why don’t you go off and make something useful, then come back and tell me all about that very useful thing you made instead of blathering on about brands.”

And so, because I am human, and every bit as lazy and ill-tempered as the rest of you, I will not get down to the business of completing the chore … before bitterly lamenting the nature of the chore itself (with all due respect to Julia Novak). I do hereby bitterly lament the branding chore. But I’ll take a shot.

That shot includes quoting a five-year-old interview.

But before delving into the dusty archives, I want to have a look at the preliminary results of a survey that was conducted recently among residents. I think it shows that our self-image as a community valuing public participation is not especially well-founded. So that’s not our brand. Not right now, anyway.

Survey Says: Self-Image Not Supported

First, I think it’s worth distinguishing between self-image and a solid brand. I think that many residents would name “community engagement” or “public participation” as part of Ann Arbor’s brand – a trait that distinguishes Ann Arbor from other cities. For example, Ann Arbor has enacted a “citizen participation” ordinance that requires developers of new projects to accommodate the desire of Ann Arbor residents to participate in local decision-making. According to that local law, developers are supposed to:

… pursue early and effective citizen participation in conjunction with their proposed developments, giving citizens an early opportunity to learn about, understand and comment upon proposals, and providing an opportunity for citizens to be involved in the development of their neighborhood and community;

Yet I would contend this self-image does not translate to an empirically-based brand. And that contention is supported, I think, by the results of a relatively scientific survey conducted in the fall of 2013. [.pdf of draft Ann Arbor National Citizens Survey report] [.pdf of responses, benchmarks, methodology and questionnaire]

The survey measured attending public meetings at just 15% of respondents, and watching a public meeting only somewhat higher, at 19%. The survey measured reading or watching local news at just 75%. But maybe those low numbers still stack up fine against other benchmark communities? Nope. Those light purple bars in the bar graph at the start of this column mean that the numbers are lower (in a statistically significant sense) than in benchmark communities.

Think about that for just a second. According to the result of that survey, 1 in 4 Ann Arbor residents “rarely” or “never” watches or reads local news.

I think at least some of the “community engagement” scores are not as weak as they appear in the draft report. For example, the summary report indicates that only 30% of the 778 Ann Arbor residents who responded to the survey reported talking to or visiting with neighbors more than once a month. But that looks like a simple matter of a failure to tally both categories of responses that fit the summary description “more than once a month.”

The specific “talks to neighbors” question included two categories that reflect ”more than once a month.” Specifically, 30% (N=230) of respondents answered the question about neighbor interactions with “two times a week or more” (dang, I just gave you a cup of sugar, get offa my porch!) and 28% (N=211) said they interacted 2-4 times a month. So that summary report probably should say 58%, not 30%. The last time this survey was done, in 2008, the summary stat for that item was 60%. So instead of dropping by half since the last survey, this stat was likely well within the 4-point margin of error. That’s why it’s labeled as a draft, I think.

On Being That Guy

During his unsuccessful campaign this year to win election to city council representing Ward 2, Kirk Westphal pled with voters to participate in local elections [emphasis added in bold]:

As an urban planner, I know council can and must do better. But to do this, I need you to vote. A friend of mine recently told me: “Kirk, I hate to admit this but I haven’t been voting in local elections. Everything is going great so I feel like I’d just mess things up.” This is not to judge. I’ve been that guy in places I’ve lived before. And Ann Arbor’s been doing well for the past 10 years, despite very low voter turnout. I’m telling you tonight, it’s no longer okay to sit-out local elections.

Dude, I have been that guy in Ann Arbor. But I’d go a step further. Before 2005, I wasn’t just sitting things out – I was actively and aggressively not paying attention to local civic life, because I felt I had way more important matters to think about. But around 2005 I more or less accidentally launched a teeter totter interview series. I had no real expectation that anyone would accept an invitation to ride a teeter totter in the middle of winter. But Rene Greff, co-owner of Arbor Brewing Company, wrecked what could have been just a funny joke – by accepting.

From there I felt I needed to get myself up to speed on local affairs so I would at least be marginally conversant in a range of topics – so I could hold up my end of the teeter totter. And frankly, I looked more to local blogs like ArborUpdate and Ann Arbor Is Overrated than I did to the local newspaper. That’s a bit ironic, because I wound up here in Ann Arbor only because I’m married to someone who was offered a job with the local newspaper.

But I also looked to guests who were sitting on the other end of the teeter totter for some insight – insight into this place where I’d accidentally landed.

What I Heard About Branding on the Totter

The precise formulation of the city council’s homework chore includes this question [emphasis added]:

What differentiates Ann Arbor from other communities in Michigan?

That formulation reminded me immediately of a teeter totter interview I did up in Hunt Park back in 2008 – because the guest on that occasion was making the point that Ann Arbor is not competing with other communities in Michigan, so much as the rest of the world. Here’s what John Floyd had to say:

So what does it take for us to attract, and retain, people who could go anywhere to start a business? The university brings a lot of people through – they come, they get their ticket punched, and they go on to the next opportunity. Whether that is because of career advancement, or I’ve got these three options: This one, I don’t have to deal with February …  San Diego. Any of the S-cities, really. Salt Lake, San Diego, San Jose, San Francisco, or even Seattle doesn’t really have February. They have a little more rain.

They don’t have February the way we have February. I have a buddy who is a venture capitalist in town, Lindsay Aspegren at North Coast, and he has pointed out to me, you guys are crazy if you think that you’re competing with Ohio or Indiana. You are competing with Asia. You’re competing with Tokyo and Shanghai and Singapore and Bangalore – that’s who you’re competing with. Not just Chicago or Minneapolis. So that really is who we have to compete with.

Who is going to come to Michigan? Who is going to help us reinvent this economy? Why would somebody want to stay here? People have heard this argument a lot on their front porches – we don’t have mountains, we’re not on the ocean, the river is not navigable, we don’t have a great venture capital industry. We have a nascent one, and Mr. [Michael] Finney [of SPARK] and other people are working manfully to make that greater. But the fact is there is probably more venture capital in Minneapolis. And their winters are sunny, not cloudy. Even though they’re further north – the snow comes down in November and doesn’t melt until April.

My late wife used to complain, we should be in Minneapolis because there is real winter, and it doesn’t freeze and thaw, and it’s not so depressingly cloudy all winter long. So how are you going to compete with that? And my suggestion is that we are not going to compete with them by going head on. We’re not going to out-urbanize any of those places. We have to find some other things they don’t have, for us to be a place that attracts people. [A small-town feel, big-city vitality] is also our chief economic weapon. But that really has escaped people’s thinking, because they don’t think about it much.

Discussion Prompt

Even if you disagree with Floyd’s conclusion about the (un)desirability of increased urbanization, I think it’s probably fair to grant his basic point – which I’ll paraphrase this way: It doesn’t matter much if Ann Arbor is merely a more attractive place to be than Bad Axe.

But what does it take to attract and retain folks who really do have other options? And how can we make this place more humane and fulfilling for those who don’t have other options, but perhaps just find themselves stuck here?

I’d suggest that part of the answer is grounding Ann Arbor’s brand of “public participation” in actual fact. That would mean more residents attending a public meeting or at least watching one. It would mean more people reading or watching local news.

But it might also mean just more people talking amongst themselves about matters of local interest – without an overt overlay of politics. You don’t have to build a teeter totter to do it. And to its credit, an “Ann Arbor brand” conversation is at least not overtly about politics.

So I’d like to encourage readers to participate in a conversation on Ann Arbor’s brand – but not necessarily by writing a comment online. Turn to an actual human being who’s within arm’s reach and ask that person: What, if anything is Ann Arbor’s brand? If that person turns out to be me, I promise not to call you a charlatan.

Update on Dec. 9, 2013 at 1:35 p.m.: The city of Ann Arbor has released the final reports from the National Citizens Survey:

• Dashboard Summary of Findings (PDF): A summary of resident ratings across the eight facets and three pillars of a livable community.
• Trends over Time (PDF): This report compares the 2013 ratings for the City of Ann Arbor to its previous survey results.
• Community Livability Report (PDF): This report captures what makes a community livable, attractive and a place where people want to be.
• Technical Appendices (PDF): Complete survey responses, benchmark comparisons, detailed survey methods and survey materials.
• Open-ended Responses (PDF): Verbatim responses to the open-ended question, “What should be City leaders’ top three priorities to maximize the quality of life in Ann Arbor?”

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