The grant, which comes from the Department of Homeland Security under the auspice of the Assistance to Firefighters grant program (AFGP), is for a specific project for which the local fire department applied. The project involves installation of vehicle exhaust capturing systems – so that diesel fumes don’t accumulate inside the fire stations. The federal grant requires a local match of $21,969 (25%). That local match is being made with money from the city’s general fund.

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

According to the labor contract between the city and the International Association of Firefighters Local 693, the city is required to provide two sets of turnout gear for each firefighter – in accordance with National Fire Protection Association (NFPA) standards.

According to the staff memo, at least 20 sets of gear are due for scheduled replacement, and 14 more sets of gear are needed in order to equip seven new hires.

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

Margie Teall (Ward 4) raises her hand asking to be recognized so she can speak at the Ann Arbor city council’s Nov. 8 meeting. (Photos by the writer.)

Smith had said her farewell from the council at the previous meeting, on Oct. 15. She had decided not to seek re-election to her seat. At the Nov. 8 meeting, two other councilmembers attended their final meeting – Carsten Hohnke (Ward 5) who, like Smith, did not seek re-election, and Tony Derezinski (Ward 2) who did not prevail in his August Democratic primary. New councilmembers – Sumi Kailasapathy (Ward 1), Sally Petersen (Ward 2) and Chuck Warpehoski (Ward 5) – will be ceremonially sworn in at the start of the council’s next meeting on Nov. 19.

A transitional theme emerged, as discussion of some agenda items straddled the Nov. 8 and Nov. 19 meetings – including the transit authority opt-out vote. Stephen Kunselman (Ward 3) had been planning to bring a similar item forward on Nov. 19, when he felt he’d have a six-vote majority on the question. But that move was preempted by the Nov. 8 item, which included the sponsorship of Sabra Briere (Ward 1), Christopher Taylor (Ward 3) and mayor John Hieftje – who had previously been key figures in supporting the city’s role in the planned authority.

Discussion of a living wage waiver for the nonprofit Community Action Network (CAN) also included mention of the Nov. 19 meeting. That’s when a proposal will be brought forward that would change the living wage ordinance itself. The preference of Hieftje and Hohnke to wait and consider the ordinance revision for all nonprofits – instead of granting a waiver to CAN – was strong enough that they voted against the waiver. But the eight votes it received were enough to ensure that for the next three years, CAN does not need to abide by the living wage ordinance – which would otherwise require it to pay all its workers $13.57/hour.

A resolution that transferred $90,000 from the general fund reserve to the affordable housing trust fund was part of the transitional theme – because it had Sandi Smith’s name attached as a sponsor, even though she could not attend the meeting. The dollar amount was keyed to the price of a strip of land belonging to the former YMCA lot, which the Ann Arbor Transportation Authority recently purchased from the city. The transfer of funds was made in the spirit, if not the letter, of a policy enacted by the council at Smith’s urging at her final council meeting. That policy called for net proceeds of the sale of the Y lot to be deposited in the affordable housing trust fund.

The council’s agenda for Nov. 19 was partially previewed when both Briere and Jane Lumm (Ward 2) announced they’d be bringing forward proposals to revise the city’s Percent for Art ordinance – in the wake of a failed public art millage proposal at the polls on Nov. 6. Briere’s proposal would alter the definition of projects that qualify, while Lumm’s would eliminate the program. The Percent for Art ordinance requires that 1% of the budgets for all capital projects be set aside for public art.

And although he’ll be leaving the council, Derezinski will serve out the remainder of Evan Pratt’s term on the city planning commission. Pratt is leaving that role after being elected Washtenaw County water resources commissioner. At the Nov. 8 meeting, council confirmed Derezinski’s planning commission nomination, which had come at the council’s previous meeting. The council also decided to expand a task force on planning for the North Main corridor to make room for outgoing councilmember Sandi Smith, and appointed her to that group as a citizen member. She’s been serving as the council’s representative.

In other business, a resolution that would have moved toward converting the city’s retirement system to a defined contribution plan – instead of a defined benefit plan – was withdrawn. The council also approved increasing the staffing level of the fire department from 85 to 86 firefighters. And the city’s sign board of appeals (SBA) was dissolved by the council, with responsibilities transferred to the zoning board of appeals (ZBA). The council also voted to give city attorney Stephen Postema a 2.4% raise, his first in five years.

Countywide Transit Act 196 Opt Out

The council considered a resolution that withdrew the city of Ann Arbor from a new transit authority – called The Washtenaw Ride – that was incorporated on Oct. 3, 2012, a little over a month ago. Incorporation of the new transit authority under Act 196 of 1986 had been preceded by the development of a 30-year transit master plan and a five-year service plan by the Ann Arbor Transportation Authority, over a more than two-year period.

The cost of the planning effort came up in council deliberations. An outside consultant, Steer Davies Gleave (SDG), held two contracts with AATA to help develop a transit master plan and take steps toward implementing it. At its Feb. 16, 2012 meeting, the AATA board authorized an increase in the SDG contract by $95,500 – to $288,817. That contract with the London-based consultant was for “implementation assistance” of the plan. The original implementation assistance contract was approved by the board at its July 19, 2011 meeting.

The original contract with SDG for development of the transit master plan was for $399,805. It was previously extended and increased at the AATA board’s Nov. 18, 2010 meeting by an amount not to exceed $32,500.

Countywide Transit: Background

The language of the council’s Nov. 8 resolution offered some optimism that expanded transportation services might be pursued with some other mechanism than a countywide Act 196 incorporation: “… AATA is encouraged to continue to discuss regional transportation options among Ann Arbor, Ypsilanti, Ypsilanti township, Ann Arbor township, Scio township and Pittsfield township, leading to a better understanding and process for improving local transit options …”

The version placed on the Nov. 8 agenda by mayor John Hieftje, Christopher Taylor (Ward 3), Sabra Briere (Ward 1), Marcia Higgins (Ward 4), and Stephen Kunselman (Ward 3) had the same effect as one that had been developed for the Nov. 19 agenda by Kunselman and Jane Lumm (Ward 2). The preambles to the two approaches, however, contrasted in the level of forward-looking optimism that was conveyed. The contrast is also evident in the titles of the two resolutions:

• [Resolution to Withdraw from New Act 196 Public Transportation Authority in and for Washtenaw County and Terminate the Public Transportation Agreement between the City, AATA, Washtenaw County and the City of Ypsilanti]
• [ Resolution to Withdraw from the New Act 196 Public Transportation Authority, to Terminate the 4­Party Agreement between the City, AATA, Ypsilanti and Washtenaw County, and to Continue Discussion of Expanded Transit Among Urban Core Communities]

The Ann Arbor city council’s resolution was placed on the agenda in the context of opt-out decisions by most of the other 28 municipalities in the county. Even so, until the Nov. 8 council meeting, jurisdictions still participating in the new authority included more than half the county’s population, and counted the county’s largest population centers: Ann Arbor, Ypsilanti, Ypsilanti Township, and Saline.

Ann Arbor had been expected to help lead the initiative, and had been the first of the four parties to ratify the agreement, on March 5, 2012. Since incorporation on Oct. 3, more than one glitch was encountered in the technical implementation. Those included unclarity about the start of a 30-day opt-out period, and the eligibility of current AATA board members to serve on the board of the new authority.

Countywide Transit: Public Comment

Joel Batterman told the council that although he’d been working with Washtenaw Partners for Transit, he was speaking as a resident of the city. He reminded councilmembers that he’d addressed them about two years ago on the topic of the Fuller Road Station, which he said he didn’t feel served the interests of the city or the University of Michigan. Decisions that are made or not made about transportation, he said, are among the most important and lasting choices that come before the council. He was sad that the council is looking to end current initiative. The current initiative would have meant improvement to the bus service, including extended hours and frequencies and more direct routes serving areas on the west side of town. It would also expand the service area to match better where people are living today.

Batterman allowed that people had concerns about local control. But it was also important to consider that when the AATA was formed in the early 1970s, about 56% of the county’s population lived in the cities of Ann Arbor and Ypsilanti, but today only 39% do. At the same time, the out-county is increasingly dependent on Ann Arbor employers, and the working families who need transit most often live outside the city limits.

Batterman acknowledged that rural townships might not be ready to participate in a transit authority. But those more urbanized areas that did not opt out would still have included a majority of the county’s population and would have brought a majority of the county’s transit-dependent residents within reach of the transportation they need. That’s something that really matters and still needs to happen, Batterman said – for Ann Arbor’s economy and for the well-being of everyone in the area. He encouraged the council to take the initiative in the coming year to work toward a new accord on expanding transit. He noted that Ann Arbor residents overwhelmingly support better transit – noting that even those who spoke against the formation of a new transit authority at a city council meeting last winter said they wanted many of the improvements, like expanded late night service, which the initiative was intended to help support. Whatever differences of opinion might exist over the structure and governance of an expanded transit system, he felt we could all support a future with more transit, cleaner air, expanded opportunities for people and perhaps even fewer parking garages.

Carolyn Lusch told the council that she also works with Washtenaw Partners for Transit. One of the great things about her job is she gets to hear people’s stories. Over last few months, she’s spoken with families, seniors, churches, students and businesses – people who are interested in and have great need for transit improvements. They’d told her about how they have to call a taxi to get groceries or miss a doctor’s appointment, or call up family members for favors.

The need for transit still exists, Lusch said. She was encouraged by the call for continued dialogue that’s expressed in the council’s resolution. As an Ann Arbor resident, she said, she was hopeful that expanded transit in the future would give her more options. The strong support for the concept of transit is an excellent first step, she said, but: “You can’t ride a concept home from your shift and I can’t hop on a concept when I’m going home from late night meetings downtown. I need a bus.” We need buses that run quickly, efficiently and to all the places we need them to run, she said. She thanked the council for keeping the discussion open.

Countywide Transit: Council Deliberations – Who Speaks?

Sabra Briere (Ward 1) said it’s become apparent that the interest in the current approach to expanded countywide service governance is not firm enough to go forward with it. So a group on both sides of the issue had decided to end this particular endeavor, she said. [By a group "on both sides," she meant some who had supported the four-party agreement governing the possible transition when the council voted on it (Briere, Hieftje, Taylor) and some who had opposed it (Kunselman, Higgins).]

Briere said it was important to end the initiative as firmly but as softly as possible.

Hieftje wanted to add Scio Township to a list of municipalities mentioned as those with which conversations would continue in the shorter term: Ann Arbor, Ypsilanti, Ypsilanti Township, Ann Arbor Township, Pittsfield Township.

Some members of the AATA board and staff were in the audience available for comment. So Tony Derezinski (Ward 2) invited AATA strategic planner Michael Benham to the podium. Higgins objected and asked that the matter be put to a vote. Arguing against allowing Benham to take the podium, Higgins said that before asking AATA to speak, the council should vote the resolution up or down.

By way of background, Higgins appeared to be invoking a subsection of the council’s Rule 4 [emphasis added]:

Members of Audience Addressing Council
Upon the request of a member of the Council, a member of the audience shall be permitted to address the Council at a time other than during public commentary, unless three members of Council object.

Kunselman also objected, saying that the council was voting on an issue that had been put before the council by Washtenaw County – the inclusion of Ann Arbor in a countywide Act 196 authority that had been incorporated by the county – not by the AATA. Carsten Hohnke (Ward 5) said he wanted to err on the side of allowing councilmembers to ask questions of anyone they’d like to ask. Although she said she agreed with Higgins that the vote was about opting out, Jane Lumm (Ward 2) didn’t have a problem with Benham fielding questions. Responding to Kunselman’s remarks that the resolution was not about the AATA, Taylor observed that AATA is identified in a resolved clause as being asked to do something.

Outcome on allowing AATA staff to speak: The council voted 8-2, with dissent from Higgins and Kunselman, to allow Michael Benham to speak.

Countywide Transit: Council Deliberations – AATA Speaks

Benham said the AATA was heartened by the language in the resolution that says “keep going.” He was optimistic that the community could arrive at a vision of expanded transit for those who need it the most.

Hieftje then disavowed the idea that the resolution that night was an attempt to pre-empt the Lumm and Kunselman resolution, pointing out that Kunselman had been invited to co-sponsor it, which he’d done. However, Hieftje said it was “difficult” to have more than five councilmembers co-sponsor a resolution. [Six is a quorum of the council; so if six councilmembers sponsor a resolution together, it gives rise to questions about whether they convened a meeting of the council in violation of Michigan's Open Meetings Act.] He ventured that Lumm’s name could be added as co-sponsor then, and Lumm indicated that she’d like that.

Kunselman picked up on remarks by Hieftje to the effect that ridership on the AATA was going up. He read aloud a portion of a press release from the AATA:

AATA also will review existing services and costs to ensure its history of strong fiscal stewardship is not disrupted, he said. The review will determine the feasibility of continuing to provide the services implemented as part of AATA’s initial investment under its Five-Year Transit Program. These services produced successful results within months of introduction but may no longer be sustainable without additional funding …

The services that had been introduced to jumpstart the countywide initiative include: increased Route #4 frequency, the AirRide airport service, expanded NightRide service, and commuter express service between Chelsea and Canton.

Kunselman said that what he heard in that language was: The AATA needs more money. Benham told Kunselman that the services mentioned in the press release were implemented with the expectation that there would be a new funding source – provided through the Act 196 authority. The services are not currently sustainable into the future, with just the existing funding that’s available. Kunselman told Benham that he really appreciated the straightforward response from Benham.

Higgins told Benham that she’d approached AATA over the years because councilmembers had heard from residents that their transportation needs are not being met out in neighborhoods. She asked what guarantee she had that these sorts of concerns would not continue to be ignored. Benham indicated that he was not aware of any view on the part of the AATA that travel to and from neighborhoods is not a priority. Higgins related an anecdote about a visitor to the city of Ann Arbor who needed 1.5 hours to get from the north to the south side of the city – saying a three-hour commute inside the city of Ann Arbor isn’t acceptable. She didn’t think all the community’s transportation needs are being met, and noted that Ann Arbor had an aging population that needs transportation. Now is an opportunity to make her a believer, Higgins said.

As the deliberations continued, local resident Thomas Partridge – sitting in the audience – expressed his displeasure with the way the conversation was going by pounding his crutch on the floor and slamming a bound copy of the council’s agenda on the counter. Hieftje raised the possibility that Partridge would be removed, saying that tantrums weren’t usually tolerated.

From left: Jane Lumm (Ward 2), Christopher Taylor (Ward 3 – leaning back) and Stephen Kunselman (Ward 3).

Kunselman weighed in heavily in favor of maintaining the current governance of the AATA under local Ann Arbor control using Act 55, with purchase-of-service agreements (POSAs) made with those communities who want transportation service. The articles of incorporation could be modified to include additional seats on the board for those communities, he said. Later in the deliberations, Briere ventured that residency in Ann Arbor for AATA board members was a possible issue of concern for some councilmembers, so that needs to be addressed directly.

Lumm expressed the view that those on the council who’d predicted that the proposal would not be well received by the townships had been right. She characterized the effort to implement the countywide authority as a colossal waste of time and money.

Margie Teall (Ward 4) responded to Lumm, saying that she didn’t think effort had been wasted – because it’s raised awareness that Ann Arbor is part of a region.

Derezinski expressed his disappointment that the effort was not going forward, but indicated he’d support the resolution.

Hohnke said he was a little bit disappointed in the decisions of some of the townships to opt out. Lumm responded that she was not disappointed in the townships, saying she trusted them to protect the interests of their residents.

Hieftje felt it was a little too easy to say that the AATA wasted resources developing a plan and exploring this approach to countywide governance. He noted that in Grand Rapids, a similar proposal had to be put to voters twice before they approved it. He drew a comparison to the failure of the Ann Arbor District Library bond proposal at the polls on Nov. 6 – noting that one of the greatest criticisms of the library bond proposal was that the library didn’t have a specific plan for the new downtown building.

Outcome: The council voted unanimously to opt out of The Washtenaw Ride.

Living Wage Exemption for Nonprofit CAN

The city council was asked to consider a waiver for Community Action Network (CAN), so that the nonprofit would be exempt from compliance with the city’s living wage ordinance for the next three years.

Living Wage: Background

CAN is a nonprofit dedicated to improving communities in underprivileged Washtenaw County neighborhoods, and receives allocations from the city through the city’s coordinated funding process to support human services. For fiscal year 2013, CAN was allocated $105,809 by the city for its Y.E.S. You CAN! program. Because those annual allocations exceed $10,000, CAN is subject to the city’s living wage ordinance, which currently requires that a minimum of $12.17/hour be paid to employees by employers who provide health insurance and $13.57/hour by those employers not providing health insurance.

However, Ann Arbor’s living wage ordinance has a mechanism by which the minimum requirements can be waived – if conformance would cause economic harm to a nonprofit. It’s that waiver provision that the Ann Arbor city council was asked to approve at its Nov. 8 meeting.

One condition of the waiver is that a plan for eventual compliance within three years must be submitted to the city. CAN’s plan highlights the programs that it would need to cut, in order to conform with the ordinance. [.pdf of CAN's compliance plan]

Jane Lumm (Ward 2) also announced at the Nov. 8 meeting that in the near future she would be bringing forward an ordinance revision to exempt nonprofits from the living wage ordinance permanently. That echoes a previous attempt two months ago by the council to exempt some nonprofits from the living wage ordinance. On the council’s agenda for Sept. 17, 2012 had been a resolution that would have exempted from the living wage ordinance those nonprofits receiving city human services funding.

The Sept. 17 resolution appeared to be an attempt to invoke the ordinance’s waiver provision, but it did not name a specific nonprofit, and no plans for eventual conformance had been submitted by any nonprofits at that time. So the agenda item was withdrawn as it was deemed to be tantamount to changing an ordinance through a simple council resolution – which is not a legal way to procede. At that time it was indicated that an ordinance revision would be forthcoming.

Living Wage: CAN’s Previous Waiver Attempts

Based on correspondence provided to The Chronicle by the city of Ann Arbor in the context of a broader request made under Michigan’s Freedom of Information Act, the Sept. 17 agenda item stemmed from requests made by CAN, although that organization was not specifically mentioned in the council’s resolution or in discussion at the table. Together with the material obtained through the FOIA, CAN’s compliance plan indicates that Doughty submitted a letter on July 10, 2012 asking for a waiver. [.pdf of July 10, 2012 letter from CAN]. Just before the Sept. 17 meeting, CAN was asked to revise the request to mention a plan eventually to comply. [.pdf of Sept. 17, 2012 letter from CAN] The revision consisted of the following addition:

Community Action Network will use this exemption time to devise and implement a strategic fund raising plan to fill our budget gaps caused in part by the increased burden the living wage ordinance continues to place on our finances.

However, the ordinance specifies that the plan to bring an organization into compliance must be submitted as part of the waiver. And the lack of an actual compliance plan led to the withdrawal of the Sept. 17 resolution.

The concern raised by CAN dates back at least to February 2012. In email correspondence sent on Feb. 7, 2012 by CAN director Joan Doughty to the city/county office of community development Mary Jo Callan and councilmember Christopher Taylor (Ward 3), she made a plea for some kind of accommodation with respect to the living wage ordinance:

From: Joan Doughty
Sent: Tue 2/7/2012 5:05 PM
To: Taylor, Christopher (Council); Callan, Mary Jo
Subject: Living Wage?

Hi Mary J and Chris:

Hope this finds you well. I would really like to reignite the living wage ordinance waiver for nonprofits. We’re going to be hurting, and paying summer camp counselors living wage is sort of ridiculous. The city doesn’t do it either. …. so …. Please? I’m begging you — do something!

Best,

jmd

Joan M. Doughty
PhD Executive Director Community Action Network
www.canannarbor.org

Doughty’s correspondence to the city indicates that many other nonprofits receiving funding from the city don’t meet the conditions of the living wage ordinance, but there is no enforcement.

Doughty’s correspondence in the summer of 2012 also mentions the fact that the city’s ordinance is likely on dubious legal grounds. As The Chronicle has previously reported, a Michigan Supreme Court order from April 7, 2010 left in place an unpublished court of appeals opinion that found a Detroit living wage law to be unenforceable.

Doughty appears to indicate in her correspondence that city attorney Stephen Postema had related in conversation with Doughty’s husband, Washtenaw County prosecutor Brian Mackie, that Postema felt if the city’s living wage ordinance were to be challenged in court, it would be struck down. Writing on July 12, 2012 to Sandi Smith (Ward 1), Doughty indicated that a “family member” of hers had discussed the legal issues with Ann Arbor city attorney Stephen Postema:

I understand that Steve Postuma [sic] circulated a confidential memo to city council members about the issue. Publicly he holds that because the Supreme Court’s decision was “unpublished” (it’s not – you can find it on the Internet) it isn’t applicable wider than in the Detroit case. That might be true, but a family member of mine with considerable legal knowledge contends that if a company or agency challenged the Ann Arbor living wage in court, it too would most likely fall. And Steve has conceded this to the same family member…

In a phone interview, Mackie told The Chronicle that he does recall discussing the living wage issue with Postema, characterizing the conversations as not being substantive. However, Mackie recalled telling Postema he thought it was wrong that the city was exempting itself from its own ordinance. He also recalled Postema saying there was an argument to be made in defense of the ordinance – but Mackie said he didn’t recollect anything more detailed than that.

In other correspondence on April 26, 2012 to city of Ann Arbor community services area administrator Sumedh Bahl, Doughty refers to her husband:

I asked my husband (who is an attorney) to read the court of appeals decision, and he is of the opinion that it shouldn’t take filing a lawsuit against the city to “make” it take the right and legal action.

In her July 12 email, Doughty pitches the idea to Smith of altering or rescinding the city ordinance. And it’s Smith to whom Doughty proposes the idea, in part because Smith would be leaving the council, because she did not seek re-election:

… she [Mary Jo Callan] told me that the city council members she talked to would like to change the living wage, but, in our liberal climate, none of them want to be “the one” who proposes it. So … since you’re not running for re-election, I’m hoping you are willing to “do the deed”. There are many approaches and options: abolish it completely since there is nobody monitoring it and it’s probably illegal – revoke it pending a potential overhaul, exempt nonprofits, define more specifically who should receive living wage (so: not summer staff, not true part time staff and entry staff levels) etc. etc. etc.

Living Wage: Council Deliberations

Marcia Higgins (Ward 4) wanted to know how many exemptions from the city’s living wage ordinance had ever been granted. City attorney Stephen Postema indicated that he was not personally aware of one.

Joan Doughty, executive director of the Community Action Network (CAN).

Mayor John Hieftje ventured that the Ann Arbor Summer Festival had been exempted. Jane Lumm (Ward 2) noted that the ordinance had been revised to exempt nonprofits that are supported through the city’s community events fund, as is the case with the Summer Festival. [For some additional history of the living wage in Ann Arbor, see "Living Wage: Insourcing City Temps"]

Higgins indicated she was not against granting a waiver to CAN – and she was asking about previous waivers merely because she was curious.

Hieftje had a couple of concerns about granting a waiver to CAN. For human services nonprofits, he said, some of their employees are trying to avoid becoming clients themselves. CAN’s situation, he allowed, might be somewhat different in that the positions in question were held by part-time, student employees, rather than full-time. Hieftje said he would need some time to think about it, but would prefer to consider the issue more as a package of all nonprofits at one time. His second concern was that there’s been a lot of time since the ordinance was enacted – and at the beginning the provision for a waiver was put in to give nonprofits time to adjust. He characterized himself as “still puzzling this one out.”

Margie Teall (Ward 4) asked Joan Doughty to come to the podium to answer questions. Doughty confirmed that the waiver was being requested not in order to pay full-time staff less than the living wage, but rather for students. Doughty also stressed that she and CAN are not against the living wage, but rather against it as it’s written and applied currently. She added that a lot of nonprofits are not paying the living wage, but said that “We all know that it’s not being checked.” But “flying under the radar” was not how CAN does its business, she said, so CAN wanted to use the waiver option as provided in the ordinance to do it the right way.

Lumm indicated that additional background on the living wage would be provided at the Nov. 19 meeting when the ordinance revision would be proposed. Sabra Briere (Ward 1) asked for clarification about why CAN hadn’t been able to receive the funds it was due under the contract with the city. Doughty explained that the city attorney had indicated the funds couldn’t be disbursed to CAN until she signed, indicating that CAN was complying with the city’s living wage ordinance. Doughty indicated that instead of signing something that attested that CAN was complying with the living wage ordinance, CAN had applied for a waiver. Unless that waiver is approved, she said, CAN could not get paid.

Stephen Kunselman (Ward 3) told Doughty that he appreciated that CAN was following the city’s ordinance – and that was enough to make him support it. Teall concurred with Kunselman. Unlike Hieftje, Teall said she’d prefer to decide the waiver for CAN separately from the ordinance revisions. She felt that CAN has waited long enough.

Carsten Hohnke (Ward 5) took issue with the view expressed by Teall and Kunselman, saying that the fact that there’s a mechanism for requesting a waiver shouldn’t be sufficient grounds for granting it. Part of the compliance plan is supposed to include an explanation for how the organization would come into compliance, he noted. Doughty told Hohnke: “That’s what we submitted.” Hohnke told her he was having trouble following the plan. Doughty ticked through the basic four options: (1) CAN would cut programs; (2) CAN would reduce eligibility for participation; (3) the city would increase human services funding; or (4) the city would change the ordinance exempting nonprofits.

From left: Ann Arbor councilmembers Mike Anglin (Ward 5) and Carsten Hohnke (Ward 5).

Hohnke asked what other sources of funding CAN had. Doughty listed off several organizations: Ann Arbor Housing Commission, the city of Ann Arbor, Washtenaw County, United Way, HUD, Ann Arbor Area Community Foundation, various church congregations, Kiwanis, and Rotary. She allowed that it’s a complicated funding structure for a small nonprofit. Hohnke appreciated that Doughty had brought forward the issue, because it allowed a structural issue to be identified. It might be that some people don’t need to earn a living with the wage they’re being paid, Hohnke said. Like Hieftje, he wanted to consider it as a whole rather than as a one-off exception. He indicated support for possible postponement.

Responding to Hohnke’s suggestion to postpone, Doughty indicated that CAN can’t get paid until a waiver is granted. Hieftje admonished Doughty that she needed to restrict herself to responding to questions.

Lumm addressed the timing issue by saying that the ordinance revision would have been brought for initial consideration that night. But it was seen as undesirable to have one edition of the council approve it on first reading and another at the second reading. [The new council will be seated at the Nov. 19 meeting.]

Sabra Briere (Ward 1) indicated that for her, there were two important considerations: (1) CAN hasn’t signed a living wage statement; and (2) the application for a waiver requires a plan to come into compliance. She said she’d read the plan submitted by CAN several times, but she didn’t see how it brought CAN into compliance. Doughty pointed Briere to the part in the plan that explains how CAN would use the time of the waiver to renegotiate contracts with other funders so that CAN could pay those contracts. Briere indicated she didn’t see that statement in the plan, but even if she did, she wasn’t sure how that would bring CAN into compliance. Briere recognized that Lumm was going to propose an ordinance revision, but there’s no guarantee it would pass.

Lumm asked city attorney Stephen Postema if he’d reviewed CAN’s compliance plan. Postema indicated that he’d looked at the plan, but said it’s for the council to determine if the plan is sufficient. He allowed that the plan covers the words of the ordinance. Lumm got confirmation from Postema that the city does exempt itself from the living wage.

Mike Anglin (Ward 5) told Doughty she was in an unenviable position, saying that CAN does a tremendous service to the community. He didn’t want to get lost in the semantics. He appreciated that Doughty had stepped forward and said CAN was having a hard time, calling it noble of Doughty to have come forward. Anglin feared that this is the tip of a terrible iceberg.

Tony Derezinski (Ward 2) echoed Anglin’s sentiments. He got confirmation from Doughty that the needs increase during the winter months. That immediacy, he said, warrants consideration immediately. The larger issue of the ordinance revision can be addressed later, he said.

Christopher Taylor (Ward 3) indicated that he knew what good work CAN does, and he felt it makes perfect sense that an amendment to the ordinance should be sought. That’s logically separate, however, from seeking a waiver within the ordinance, he said. In contrast to Teall and Kunselman, however, he didn’t see CAN’s request for a waiver as trailblazing or as enhancing the moral stature of CAN. For the city to enforce the ordinance also does not diminish its moral standing, he said. Taylor allowed that it’s a good thing that CAN chose not to dissemble, but it’s not a black mark on the city that it enforced its ordinance and withheld the funds. Taylor said he’s delighted there’s a mechanism to break through that knot, so he’d support it.

Marcia Higgins (Ward 4) said she didn’t have a problem supporting the waiver request. Hohnke reiterated that he felt the issue should be addressed holistically across nonprofits. Addressing the merits of the plan submitted by CAN, Hohnke felt the spirit of the plan specified in the ordinance was to think about increasing revenue streams and consolidating. He reiterated a preference to consider the ordinance change and to delay the waiver request.

Joan Doughty, executive director of the Community Action Network, and Stephen Kunselman (Ward 3).

Teall noted that if the request for the waiver had been presented last summer, the issue of considering the waiver and the ordinance change would not have come close to the same time. She wanted to know why it had taken so long. Postema observed that the city staff itself cannot provide a waiver, but rather it’s for the council to consider. There was no compliance request in place in July, he said – and CAN’s plan had only just been received.

Doughty reviewed how CAN had sent a letter, revised it and was then told that it was insufficient in September. Postema said he couldn’t comment on what happened between CAN and the office of community development. For whatever reason, he said, the waiver request is in front of the council now.

Teall indicated she agreed with Taylor’s remarks. Kunselman weighed in again, saying, “We’re way over-thinking this.” He disagreed with Taylor, saying that CAN was, in fact, blazing a trail, because they’re the first nonprofit to seek a waiver. He ventured that no nonprofit wants to seek a waiver, because they know they’d face a city council discussion that goes nowhere.

Hieftje reiterated that he wanted to take a more holistic look, which would begin at the next council meeting – in 11 days. He wanted to see the waiver postponed until the next meeting.

Briere floated the possibility that if CAN received a waiver, it might work against CAN because CAN would then be constrained by the ordinance, even if the council amended the ordinance. Taylor established that CAN would be done no harm with a waiver under the old ordinance, if the ordinance were eventually amended.

Outcome: The council voted to grant CAN a waiver from the city’s living wage ordinance, with dissent from mayor John Hieftje and Carsten Hohnke (Ward 5). Though she voted yes, Sabra Briere (Ward 1) indicated as she voted that she didn’t like granting the waiver.

Affordable Housing Trust Fund

The city council was asked to increase Ann Arbor’s affordable housing trust fund by $90,000, through a transfer from the general fund reserve.

The amount of the transfer was keyed to the cost of a piece of city-owned property that the city sold recently to the Ann Arbor Transportation Authority. And the justification for the transfer was based on the council’s recent enactment of a formal policy on the use of the proceeds of city-owned land sales.

The $90,000 piece of land is a six-foot-wide strip on the former YMCA lot at Fifth and William, immediately to the south of the location for the AATA’s planned new Blake Transit Center in downtown Ann Arbor. The $90,000 price was based on an independent appraisal. The AATA board approved its side of that deal this spring at its April 26, 2012 meeting. The city council approved the land sale over a year ago, at its Sept. 19, 2011 meeting. The total parcel area was 792 square feet.

The land sale policy approved by the council on Oct. 15, 2012 had begun as a proposal from Sandi Smith (Ward 1) to allocate 85% of the net proceeds of city-owned land to the city’s affordable housing trust fund. The council originally considered the item at its Sept. 17, 2012 meeting but delayed action. The council eventually opted to adopt a policy that treated land sales on a case-by-case basis – except for the former Y lot at Fifth and William, of which the six-foot-wide strip was a part. The enacted policy called for net proceeds from that parcel to be placed in the affordable housing trust fund. [For additional background, see: “City Council to Focus on Land Sale Policy.”]

Because the $90,000 piece of property had been a portion of the former Y lot, the resolution in effect would retroactively apply the policy on use of land sale proceeds – by transferring $90,000 to the affordable housing trust fund. The portion of the policy that requires the city to recover its costs associated with the property was not applied – as the city purchased the land for $3.5 million.

The resolution was sponsored by Sandi Smith (Ward 1), Marcia Higgins (Ward 4), and mayor John Hieftje – although Smith was not able to attend the Nov. 8 meeting.

The six-foot-wide strip of land, and its $90,000 price, has been highlighted in recent council deliberations for a different reason – as a funding source for a transportation connector study. The city of Ann Arbor had been asked to contribute $60,000 to an alternatives analysis study of the Plymouth/State corridor, from US-23 and Plymouth southward along Plymouth to State Street, extending south to I-94. The local match was needed for a $1.2 million federal grant that had been awarded to the AATA for the study.

During deliberations on the $60,000 connector study allocation at the Sept. 4, 2012 meeting, Stephen Kunselman (Ward 3) had objected to one of the “whereas” clauses in the resolution. The clause mentioned the availability of $90,000 in the general fund from the land sale, which was more than enough to cover the requested $60,000 local match. So the allocation was essentially pitched as a “return” to the AATA of a portion of the land sale price. Kunselman objected that once the $90,000 was in the general fund reserve, it was no longer earmarked as funds to be used for any particular purpose.

When the council eventually reconsidered the decision on Oct. 15, 2012 and wound up approving $30,000 for the study – because the Ann Arbor DDA had in the meantime agreed to contribute $30,000 – it was Higgins who raised the objection about the “whereas” clause. And the clause was amended out before the council’s approval.

The groundbreaking for the AATA’s new Blake Transit Center – which had occasioned the sale of the six-foot strip of land on the southwestern edge of the AATA’s property – is scheduled for Nov. 19. The AATA board gave final approval of a roughly $8 million budget for the transit center at its Oct. 18, 2012 meeting.

Affordable Housing Trust Fund: Council Deliberations

Jane Lumm (Ward 2) was concerned about the appearance that the council was randomly spending money out of the fund balance. In a back-and-forth with the city’s chief financial officer Tom Crawford, Lumm established that the resolution was a transfer from the general fund balance reserve and not directly connected to the sale of land. Crawford characterized the resolution as tying into the concept of the land sale policy, and linking the land sale in concept to the depositing of money into the affordable housing trust fund – he noted that the resolution was transferring $90,000 from the general fund balance.

From left: City administrator Steve Powers and chief financial officer Tom Crawford.

Lumm seemed to indicate some dissatisfaction with the fact that a requirement of the land sale policy – that the related transactional costs be deducted before transfer to the affordable housing trust fund – didn’t seem to apply to the resolution.

Sabra Briere (Ward 1) suggested a “friendly” amendment to change the “resolved” clause to read: “… after any costs associated with the sale have been deducted.” Crawford thought that the $90,000 was already the net amount, because the city had negotiated to have the AATA bear the closing costs. In any case, he said, the amount was not a large number. So Briere withdrew the proposed amendment.

Stephen Kunselman (Ward 3) expressed concern about the idea of applying a policy retroactively – to a piece of land that had previously been sold. Lumm echoed Kunselman’s sentiment.

Briere allowed that Kunselman and Lumm were right in that the land sale policy was enacted after the land in question had been sold. However, Briere said, “This resolution … has nothing to do with the policy – except as realization that we’d already sold a piece of the old Y lot.” It seemed appropriate to Briere to treat that previous sale as part of the Y lot, which the council wanted to go to the affordable housing trust fund.

Mayor John Hieftje indicated that he supported the resolution based on the fact that the city had not been able to make regular contributions to the affordable housing trust fund.

Outcome: The council voted unanimously to transfer $90,000 to the affordable housing trust fund.

Defined Contribution Retirement Plan

On the council’s agenda was a resolution, sponsored by Jane Lumm (Ward 2), that directed the city administrator to develop a defined contribution retirement plan to offer non-union employees hired after July 1, 2013. The city currently has a defined benefit plan.

Although the resolution indicated specific action for non-union employees, it also included a goal to implement a similar change for union employees – which would have to be collectively bargained. The second resolved clause indicated that the city would “… strive to implement the same pension changes for all new employees.”

The directive to the city administrator in the resolution stated that the non-union retirement plan – along with the appropriate ordinance amendments, related plan documents, and implementation steps – were to be developed within three months, by Jan. 31, 2013, for review first by the city council’s labor committee then by the full council.

Lumm’s resolution had been added to the Nov. 8 agenda on Nov. 2. She had told her colleagues at the council’s Oct. 1, 2012 meeting that she’d be bringing the resolution forward. She’d drafted a similar resolution in May this year, in connection with possible amendments to the FY 2013 budget. She didn’t bring forward the resolution at that time, partly because it was not technically an amendment to the budget and partly because the deliberations on the budget had already lasted several hours.

Lumm campaigned for her seat on the council in 2011 based partly on a call for a transition to a defined contribution plan. Among the reasons Lumm cited in her resolution was state legislation that was enacted recently – which will facilitate the transition to defined contribution plans. [.pdf of analysis by Senate Fiscal Agency of Public Act 329 of 2012]

In defined benefit plans, retirees receive a set amount per month during their retirement. In defined contribution plans, employers pay a set amount into the retirement plan while a person is employed. The most common of these defined contribution plans is the 401(k).

Defined Contribution Plan: Council Deliberations

Apparently related to the resolution on converting to a defined contribution retirement was a closed session held at the beginning of the council’s Nov. 8 meeting, to discuss labor negotiation strategy. Discussion of labor strategy is one of the exceptions that can be used under Michigan’s Open Meeting Act to hold a closed session. Conversion to a defined contribution plan for union members would need to be collectively bargained. The closed session was added to the council’s agenda at the meeting and took place before the council handled the rest of the agenda.

When the council reached the resolution on moving toward a defined contribution plan, Lumm said she believed the city must address issue of legacy costs. She felt that the issue should be addressed now, instead of kicking the can down the road. The city had taken one step toward addressing the problem by adopting an “access only” health care plan. The next step now, in her view, was to change to a defined contribution type plan similar to a 401(k) type of plan. She noted that other public and private organizations had adopted this approach in order to reduce employee costs.

In 2004, a city of Ann Arbor blue ribbon committee had made a recommendation to transition to such a plan, and it’s now seven years later, Lumm said. However, she noted that the city administrator and the city attorney had raised some questions about her resolution. Out of respect for their concerns she was withdrawing the item, but she looked forward to future discussion.

Outcome: The item on moving toward a defined contribution retirement plan was withdrawn.

Appointments

At its Nov. 8 meeting, the council handled a couple of items related to appointments to boards, commissions and task forces.

Appointments: North Main Task Force

The council considered expanding a task force that’s looking at future planning for the North Main Street and Huron River corridor – so that it could include outgoing councilmember Sandi Smith (Ward 1). She was appointed to represent the council on the group, but did not seek re-election to her council seat.

Mayor John Hieftje had indicated at the council’s Oct. 15, 2012 meeting that he would be moving to expand the task force in this way. The resolution was sponsored by Smith’s Ward 1 cohort, Sabra Briere.

Smith’s last meeting was Oct. 15, because she was unable to attend the final meeting of her term, which was Nov. 8. New councilmembers – including Sumi Kailasapathy, who’ll take the seat held by Smith – will be ceremonially sworn in at the council’s Nov. 19 meeting.

The task force is due to make a recommendation on a use for the city-owned 721 N. Main Street parcel by the end of the year. That comes in the context of a planned application by the city to the Michigan Dept. of Natural Resources Trust Fund next year for a grant in connection with 721 N. Main. The group’s broader recommendation for the entire corridor is not due until mid-year 2013.

Outcome: The council voted unanimously to expand the North Main task force, to confirm Sandi Smith as an additional citizen member and to confirm Sabra Briere as the council representative to the task force.

Appointment: Planning Commission

On the agenda was the confirmation of Tony Derezinski to fill a partial term on the city planning commission – through June of 2013. Derezinski’s last meeting as a city councilmember was Nov. 8, and up to that point he had served by annual appointment as the council’s representative to the planning commission. But because he did not prevail in his August Democratic primary race in Ward 2, he could not continue to serve on the planning commission in that capacity. Instead, it’s expected that Sabra Briere (Ward 1) will serve in that role.

The vacancy on the planning commission for which Derezinski was nominated is opening up due to the resignation of Evan Pratt, who won a new position for himself as Washtenaw County water resources commissioner in the Nov. 6 election. Derezinski was nominated by the council to fill a citizen position on the commission.

Derezinski, along with Susan Baskett, also had been nominated at the council’s Oct. 15 meeting to serve as a board member for the recently incorporated Act 196 transit authority. But in light of the council’s action to opt out of the transit authority at its Nov. 8 meeting, the council won’t be acting on those nominations.

Ward 2 city councilmembers Tony Derezinski and Jane Lumm.

Mayor John Hieftje introduced the item on the agenda by thanking Pratt for his service on the planning commission. Hieftje indicated that his interest in appointing Derezinski was based on a desire to have some continuity on the commission.

Jane Lumm (Ward 2) began her remarks objecting to Derezinski’s appointment by turning to Derezinski, seated immediately to her right, and saying, “You know I love you, Tony … This is really not fun for me.” She stressed that her objection had nothing to do with Derezinski. She was not comfortable making the appointment for reasons similar to those she gave in voting against the appointment of Sandi Smith (Ward 1) to the board of the DDA. [That vote came at the council's Aug. 20, 2012 meeting.] She drew a distinction between the appointment of Smith to the North Main task force, and the appointments to the DDA board and planning commission.

Lumm told Derezinski that she felt he’d done a phenomenal job on the planning commission. She allowed that it had been a practice to appoint former councilmembers to such positions, but she did not agree with it. She concluded her remarks by telling Derezinski, “I hope you understand.” His response: “Noted.”

Lumm’s remarks prompted several councilmembers to express their support of Derezinski’s appointment. Hieftje drew a comparison between Derezinski’s appointment to the planning commission and that of former councilmember Jean Carlberg. He said it would be a shame to waste the expertise and depth of knowledge that Derezinski offered.

Marcia Higgins (Ward 4) noted that Derezinski’s appointment would be finishing out a term.

Outcome: The council voted to appoint Tony Derezinski to the planning commission, over dissent from Jane Lumm.

Appointments: Upcoming

Sabra Briere (Ward 1) indicated during council communications time that she’d be bringing forward to the Nov. 19 meeting the nomination of Patti Smith to serve on the city’s environmental commission. [The environmental commission is one of the few boards and commissions that have nominations come from the council as a body instead of the mayor.]

Appointments: Council Committees

Marcia Higgins (Ward 4) told her council colleagues during communications time that with new councilmembers coming on board at the next meeting, it’s the time of year when the organization of the council is considered. She asked councilmembers to forward to her their preferences for committee appointments. She hoped to have the committee appointments ready for the council’s first meeting in December.

Upcoming Council Business

The Ann Arbor city council’s post-election Nov. 8 session was its last meeting before new councilmembers are ceremonially sworn in on Nov. 19. And current city councilmembers used the occasion to announce some issues that the new edition of the council will be asked to consider.

Upcoming Business: Towing

During council communications, Sabra Briere (Ward 1) noted that she, Stephen Kunselman (Ward 3) and Marcia Higgins (Ward 4) had been working on a towing ordinance revision that would come before the council for a first reading at the Nov. 19 meeting.

Upcoming Business: Public Art

At the Nov. 19 meeting, two proposals will be brought forward on the city’s public art ordinance. The changes stem from the fact that a proposed public art millage failed at the polls on Nov. 6 by a 10-point margin (55.8% opposed and 44.14% in favor).

So at the Nov. 8 meeting, two different proposals were floated on the city’s existing public art ordinance – based on possibly differing interpretations of the expressed voter sentiment. It’s possible to construe the result as either (1) about the way public art is funded or (2) about whether public money should be used to support public art at all. One proposal was announced by Sabra Briere (Ward 1) and the other by Jane Lumm (Ward 2).

Briere’s proposal is to narrow the definition of projects to which the existing ordinance would apply. Currently, the Percent for Art ordinance applies to essentially any capital improvement project undertaken by the city, and requires that 1% of the budget for such projects be set aside for public art. Briere’s proposal would narrow the definition by restricting eligible capital improvement projects to those that are “intended to be open or visible to the public.” Projects to construct roads, highways, paths, and sidewalks would be eliminated from eligibility. Bridges would still qualify.

Briere’s proposal includes a financial threshold for qualifying projects: $100,000. Briere’s proposed ordinance amendments would also require a public process associated with proposed art projects. Part of that process would require notification of the councilmembers in whose ward a project is proposed.

Lumm’s proposal is not to amend the existing public art ordinance, but rather to repeal it. Lumm described her intent at the Nov. 8 meeting to bring forward a proposal similar to one she’d made at the council’s Aug. 20, 2012 meeting – a resolution that directed the city attorney’s office to prepare an ordinance revision that would repeal the Percent for Art program. In an email sent to other councilmembers, Lumm stated that ”… the version I will bring forward on 11/19 will be the proposed ordinance changes themselves for consideration at first reading.”

The Aug. 20 meeting was the occasion on which the council voted to place a public art millage on the Nov. 6 ballot. It was meant to provide a more flexible funding mechanism for public art in Ann Arbor. The 0.1 mill tax was expected to generate around $450,000 annually.

The proposal won a majority of votes in just 13 out of 59 Ann Arbor precincts, with the most support coming from Ward 5, Precinct 4 where 60.5% of voters supported the public art millage. Ward 5 had six of the 13 precincts where the proposal achieved a majority. And the proposal finished in a dead heat in Ward 5, Precinct 5 with 471 voting for and against it. Opposition among in-person voters was strongest in Ward 1, Precinct 9, where only 34.5% of voters supported it.

The proposal did not win a majority of votes in any precinct of Ward 2, which is represented by Lumm and Tony Derezinski, who also serves on the Ann Arbor public art commission. Nov. 8 was Derezinski’s last council meeting – he was defeated by Sally Petersen in the August Democratic primary.

Upcoming Business: Living Wage

In connection to the discussion on the living wage ordinance exemption granted to Community Action Network, Jane Lumm (Ward 2) announced she’d also be bringing forward a proposed ordinance revision for the Nov. 19 meeting that would provide a uniform exception for nonprofit entities that receive human services funding allocations from the city.

Dissolution of Sign Board of Appeals

The council was asked to give final approval to the transfer of responsibilities previously performed by Ann Arbor’s sign board of appeals (SBA) to the zoning board of appeals (ZBA). The change to the city’s ordinance had been given initial approval on Oct. 15, 2012.

The ordinance change was accompanied on the agenda by a separate council action eliminating the seven-member sign board of appeals, which most recently has had only three members, according to the city’s online Legistar system. According to a staff memo accompanying the agenda item, during the fiscal year 2012 the SBA heard six appeals and none the previous year. Appeals previously heard by the SBA will now be heard by the ZBA.

One of the advantages cited is that staff support time for the sign board would be eliminated. The dissolution of the SBA has been under discussion since 2008. The city’s planning commission discussed the issue on March 30, 2010, and more recently at its Sept. 6, 2012 meeting, when it recommended the change.

During the brief deliberations, Tony Derezinski (Ward 2) described the move as an effort to streamline the process. He noted that the SBA handled just six appeals last year. The ZBA could easily handle that as a part of its regular process, he said. Eliminating the SBA would eliminate some of the paperwork that goes along with having a separate body, he said. Mayor John Hieftje said that the streamlining would be beneficial. He ventured that maybe some people who might have otherwise had interest in serving on the sign board would instead want to serve on the ZBA.

Outcome: The council voted unanimously to give final approval to the ordinance change transferring responsibility from the SBA to the ZBA and to dissolve the SBA.

Pedestrian Improvements

The council considered to two separate projects featuring pedestrian and non-motorized improvements. One is a Safe Routes to School project on Green Road. And the other involves a Michigan Dept. of Transportation (MDOT) project to install a pedestrian island on Huron Street between Thayer and Ingalls.

Thurston Elementary Safe Routes to School project.

What the council was asked to authorize for the Safe Routes to School project – in connection with Thurston Elementary School – was an agreement between the city and MDOT for the installation of bike and pedestrian safety improvements on Green Road. The agreement is required as a condition of the federal funds used for the project – a total of $111,800. The city will be using $18,000 from its alternative transportation fund to cover construction inspection and contingency costs.

The project itself includes installation of two new pedestrian crossing islands and bike lanes on Green Road. It also includes converting a portion of Green Road to three lanes and installing two rectangular rapid flashing beacons.

The authorization to apply for the federal funding was given by the council over two years ago at its Sept. 7, 2010 meeting.

The second project is a pedestrian island being installed by MDOT on Huron between Thayer and Ingalls. The city will be performing construction engineering services in its role as construction manager. The city’s cost of $6,400 will be reimbursed from federal funds.

Construction on both projects is expected to begin in the spring of 2013.

The item on the Huron Street pedestrian island was on the consent agenda, a collection of items that are voted on as a group. Any councilmember can pull individual items out of the consent agenda for separate consideration. Sabra Briere (Ward 1) pulled out the item about the pedestrian island in order to make some remarks about it.

Not many years ago, Briere said, it would be difficult to imagine a crosswalk or light on this part of Huron Street. Now there’s even a pedestrian island. She said that these infrastructure improvements reflect a greater use of the area by pedestrians and also an acknowledgment of the importance of transportation in the community. She was pleased with the accommodations that MDOT had been able to make to implement the pedestrian island. She called it a really good move. Students and faculty walk across Huron Street at that point all the time, she said. Anything to make the crossing safer is better, she concluded.

On the Safe Routes to School items, Jane Lumm (Ward 2) thanked the staff for providing a map of the improvements and for their work in making the grant applications. And Briere pointed out that this grant is the second one received by the city for this purpose. It’s important for children to be able to walk to school instead of catching a bus, she said. This project for Thurston Elementary coordinates with one for Clague Middle School.

Briere noted that it had taken two years to bring the grant process to fruition. So the city can’t rely only on this kind of mechanism to address gaps in the pedestrian infrastructure.

Briere’s concluding remark served to foreshadow an item on the council’s Nov. 19 agenda, which would establish a $15,000 budget to analyze alternatives for filling a sidewalk gap on Scio Church Road.

Outcome: The council voted unanimously to approve both pedestrian improvement-related agenda items.

Firefighter Staffing Levels

The council was asked to nudge upward by one the number of firefighters authorized in the current year’s budget for the city of Ann Arbor – to 86. The position will be funded for the rest of the current fiscal year by tapping the general fund balance reserve for $50,000. For the full year next year, the additional position would cost about $82,000.

According to a memo sent by city administrator Steve Powers to city councilmembers, as the budget planning cycle begins for FY 2014-015, he anticipates being able to maintain the 86 firefighter positions. Part of the rationale for adding the additional position is based on the fact that a recent hiring cycle to fill six positions had resulted in seven highly qualified candidates. The additional position would, according to Powers’ memo, help manage overtime and allow assignment of personnel to fire prevention work.

Ann Arbor city administrator Steve Powers peruses the printed copy of the council’s agenda.

The staffing level at 85 already reflects the addition of three firefighters since the FY 2013 budget was approved on May 21, 2012. That staffing level increase, from 82 to 85, was funded from a $642,294 federal grant through the Staffing for Adequate Fire and Emergency Response (SAFER), which was announced on May 30, 2012. The vote to accept the SAFER grant and add three firefighter positions was taken at the council’s Aug. 9, 2012 meeting. At that time, fire chief Chuck Hubbard reported that the city had three vacancies, or 79 firefighters on staff.

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

Deliberations by the council featured a question from Stephen Kunselman (Ward 3): How does this affect a possible decision to close two fire stations? [By way of background, the city is currently still weighing whether to re-open Station 2, and close Station 3, 4 and 6, leaving three stations open – a net reduction of two stations. For more detail, see previous Chronicle coverage: "A Closer Look at Ann Arbor's Fire Station Plan"]

City administrator Steve Powers indicated that the addition of one firefighter would not have an impact either way on the station plan – because a staffing level of 86 still provides enough firefighters to operate an additional station. Adding the position would allow for better performance in the current operational configuration, he said.

Sabra Briere (Ward 1) confirmed with Powers that the addition would result in an actual addition of a firefighter, and would not just be an addition on paper.

Jane Lumm (Ward 2) expressed her support for the increased firefighter staffing levels.

Outcome: The council voted unanimously to increase the staffing level for firefighters from 85 to 86.

Plymouth Green Crossing Revision

The council was asked to give final approval to several changes to the PUD (planned unit development) supplemental regulations for Plymouth Green Crossings – a mixed-use complex off of Plymouth Road, west of Green Road. At the meeting, the council was also asked to give approval to corresponding changes to the site plan for the complex.

The city planning commission had given its recommendation to approve the change at its Aug. 21, 2012 meeting. Six major changes were proposed: (1) adding parking or flexible space for special events as permitted uses in the ground floor of a proposed three-story mixed-use building, on the site’s northeast corner; (2) increasing the use of potential restaurant space within the site from 7,000 square feet to 14,224 square feet; (3) eliminating requirements for a free-standing restaurant that had previously been planned; (4) increasing the maximum number of parking spaces from 275 to 290; (5) reducing the minimum number of bicycle storage spaces from 70 to 64; and (6) adding the following language to the facade section: “ground level facades of Building A if used as interior parking shall include architectural columns, a minimum 3-foot height masonry screen wall, and louvers or grills to screen views to parking while permitting natural ventilation.”

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

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

Plymouth Green: Public Hearing

Thomas Partridge spoke at both public hearings on the Plymouth Green Crossing. He called for connecting these types of rezoning approvals to a commitment to provide access for affordable public transportation to the sites. As a Democrat, he stands for progress, he said. He alluded to the presidential election and the campaign, which resulted in an admonishment from mayor John Hieftje to confine his comments to the topic of the hearing. Partridge told him that he disagreed with Hieftje’s attempt to limit freedom of speech. Hieftje responded that he didn’t see how a presidential candidate related to the site plan. Partridge parted from the podium with a suggestion: “Maybe you should go to law school.”

Plymouth Green: Council Deliberations

Tony Derezinski (Ward 2) described the revisions as an attempt to use the space in a better way. A lot of other potentials could be realized if the site had more parking, he said. On the site plan, Jane Lumm (Ward 2) recited the key changes and indicated that she felt they had a beneficial effect for the city and were consistent with the master plan.

Outcome: The council voted unanimously to approve the PUD and the site plan changes for Plymouth Green Crossing.

City Attorney Performance Review

The council held a closed session toward the end of the meeting, to discuss the personnel review of city attorney Stephen Postema. Deliberations on a personnel review are not required to be held in a closed session under Michigan’s Open Meetings, and may not be held in closed session unless “the named person requests a closed hearing.” Postema’s employment contract requires his personnel evaluation be conducted in a closed session.

When the council emerged from the closed session, Marcia Higgins (Ward 4) read aloud the resolution adjusting Postema’s salary upward for the first time since 2007, by 2.4%. According to the city’s human resources office, Postema’s salary before the increase was $141,538. The 2.4% increase on that base brings his annual salary to $144,934, just under that of city administrator Steve Powers, who is paid $145,000. The city attorney and the city administrator are the two positions that report directly to the city council. [.pdf of form used by councilmembers to evaluate Postema's performance]

The salary increase for Postema was balanced against the elimination of his vehicle allowance of $330/month – for a net loss in total annual compensation of $563 [141538*.024 - 330*12].

An overview of Postema’s salary history:

• Nov. 8, 2012: 2.4% raise on base salary ($141,538) bringing it to $144,934; can cash in 300 hours before June 30, 2013; car allowance of $330/month eliminated.
• Dec. 19, 2011: can cash in 250 hours before June 30, 2012.
• Oct. 24, 2011: can cash in 250 hours before Dec. 31, 2011.
• Nov. 5, 2009: can cash in 120 hours before June 30, 2010.
• Oct. 20, 2008: paid lump sum of 2.75% annual salary; could cash in 150 hours before June 30, 2009; allowed to engage in outside legal work.
• Nov. 5, 2007: base salary increased by 2.75% for “merit increase” and 1.25% “market increase”; vacation days increased to 25 days per year.
• March 20, 2006: could cash in 80 hours of unused vacation time before June 30, 2006.
• Oct. 5, 2005: base salary increased at Postema’s discretion up to 3%; awarded 80 hours of vacation time.
• Sept. 13, 2004: base salary increased by 3% to $130,810; annual vacation days increased to 22 days.
• April 3, 2003: started work at base salary of $127,000 (20 vacation days in addition to legal holidays).

After the council voted to approve Postema’s salary increase, Postema asked to deliver some remarks. He said that when he was hired, he’d been asked to come in and help the city. He described his work as a sometimes thankless task. He appreciated the faith that the council had shown in him, saying that the words of councilmembers meant a great deal to him. He said he’d continue to do what aids the city.

Outcome: The council’s vote on Postema’s salary adjustment was unanimous.

Communications and Comment

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

Comm/Comm: Elections

During his communications time, city administrator Steve Powers thanked the city clerk’s staff for their work in connection with the Nov. 6 elections.

The line to vote at the Ann Arbor Community Center on North Main Street on Election Day – Nov. 6, 2012. It wrapped around on itself inside the building and spilled out onto the sidewalk and out to the street. Some people reportedly stood in line up to two hours.

He acknowledged the long lines that some precincts experienced, and took a positive perspective on that, saying that it reflected heavy turnout. Following up on Powers’ remarks, mayor John Hieftje indicated an interest in reviewing the possibility of adding more than one electronic poll book per precinct – noting that the limit of one per precinct was a state requirement.

Hieftje ventured that it might be worth discussing the creation of more precincts – even if it were only for national elections. The length of the lines could deter some people from voting, he said.

Marcia Higgins (Ward 4) inquired with city clerk Jackie Beaudry whether the turnout for state elections might warrant additional poll books or precincts. Beaudry indicated that turnout for state elections did not generate the kind of turnout that national elections did.

Comm/Comm: AAPD Volunteer

Samantha Brandfon was recognized with a mayoral proclamation for her volunteer work with the Ann Arbor police department.

Ann Arbor chief of police John Seto and Samantha Brandfon, who was recognized by the city council for her volunteer work.

In her brief remarks to the council, she said that she’d come to Ann Arbor to attend graduate school, had stayed and was pleased to give back to the community in whatever way that she could.

Comm/Comm: Progressive Politics

During the initial public commentary session, Thomas Partridge introduced himself as a resident of Ann Arbor and Washtenaw County, a Democrat and longtime advocate for most disadvantaged members of society. He had been calling publicly and vociferously for measures to advance the cause of America’s most vulnerable for more than for 10 years. He was honored to do so once again on the occasion of the re-election of first African American U.S. president. He called on councilmembers and the mayor to remember the commitments they made when they ran for office, to work for accessible affordable services for middle class residents – and in so doing to build a better society with a greater and higher commitment to street level politics, not selfish, divisive issues. He was critical of the fact that the resolution to opt out of the countywide transit authority and the allocation of money to the affordable housing trust fund would take the city in opposite directions.

At the end of the meeting, Partridge also addressed the council and expressed his disappointment at the council’s decision to opt out of the countywide transit authority. He called on members of the public not to take that decision sitting down and encouraged them to take heart. He described mayor John Hieftje as having given up – not like Barack Obama.

Comm/Comm: Role of Local Government in Sustainability

Kermit Schlansker allowed that the presidential debates were important for the future of the country, but he lamented the fact that there’d been no mention of running out of energy. He described the national government as concerned mostly with politics. Local governments need to take up the slack, he said. He described how he’d not be able to address the council during general public commentary on some previous occasions because he’d been “kicked off the agenda” in favor of speakers who wanted to talk about medical marijuana and public art. [The council's rules for public commentary reserved time at the start of the meeting give preference to speakers who want to speak about items on the council's agenda.]

Schlansker described the Ann Arbor District Library’s bond proposal as a desire to build “a new Taj Mahal.” He wondered why there was not a bond proposal on the ballot “to feed the city.” Jobs are needed now, he said, and local government has just as much responsibility to address that need as state and federal governments. He called for the establishment of energy farms as one step that could be taken.

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

Absent: Sandi Smith.

Next council meeting: Monday, Nov. 19, 2012 at 7 p.m. in the council chambers at 301 E. Huron. [Check Chronicle events listing to confirm date]

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According to a memo sent by city administrator Steve Powers to city councilmembers, as the budget planing cycle begins for FY 2014-015, he anticipates being able to maintain the 86 firefighter positions. Part of the rationale for adding the additional position was based on the fact that a recent hiring cycle to fill six positions had resulted in seven highly qualified candidates. The additional position would, according to Powers’ memo, help manage overtime and allow assignment of personnel to fire prevention work. He indicated at the Nov. 8 meeting that this increase would not have an impact either way on the possible restructuring of the city’s fire stations – from five to three stations.

The staffing level at 85 already reflects the addition of three firefighters since the FY 2013 budget was approved on May 21, 2012. That staffing level increase, from 82 to 85, were funded from a $642,294 federal grant through the Staffing for Adequate Fire and Emergency Response (SAFER), which was announced earlier this year on May 30, 2012. The vote to accept the SAFER grant and add three firefighter positions was taken at the council’s Aug. 9, 2012 meeting. At that time fire chief Chuck Hubbard, reported that the city had three vacancies, or 79 firefighters on staff.

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

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

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

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

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

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

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

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

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

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

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

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

Knight’s Market Rezoning

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

Knight’s Market Rezoning: Background

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

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

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

Knight’s Market Rezoning: Council Deliberations

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

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

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

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

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

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

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

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

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

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

Development District 317 Maynard

On the Aug. 9 agenda was a resolution to establish a new industrial development district for the downtown Ann Arbor property at 317 Maynard St., which sets up the opportunity for Barracuda Networks to apply for a tax abatement as it moves from its current location on Depot Street to the downtown site.

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

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

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

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

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

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

Development District 317 Maynard: Public Hearing

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

Development District 317 Maynard: Council Deliberations

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

317 Maynard is highlighted in yellow.

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

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

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

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

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

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

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

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

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

Water Resources Commissioner: Flooding Solutions

The council considered a resolution directing city staff to start negotiations with the Washtenaw County water resources commissioner to identify “opportunities for stormwater conveyance and stormwater quality improvement in the area of the Malletts Creek drainage district bounded by Ann Arbor-Saline Road upstream to I-94 and Scio Church Road.”

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

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

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

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

Flooding Solutions: Council Deliberations

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

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

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

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

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

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

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

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

Demolition Contracts

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Transit Articles of Incorporation

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

The articles of incorporation are part of a four-party agreement to establish a framework for possibly expanding the governance and service area of the Ann Arbor Transportation Authority. The four-party agreement is between the city of Ann Arbor, the city of Ypsilanti, Washtenaw County and the AATA.

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

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

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

Transit Articles of Incorporation: Council Deliberations

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

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

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

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

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

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

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

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

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

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

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

Firefighters, Fire Truck

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

Firefighters

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

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

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

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

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

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

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

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

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

Fire Truck

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

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

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

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

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

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

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

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

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

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

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

Nominations

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

Disabilities Commission: Petersen

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

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

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

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

DDA Nominations: Smith, Hewitt, Orr

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

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

Communications and Comment

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

Comm/Comm: Community Center

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

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

Comm/Comm: Democratic Progressive Agenda

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

Comm/Comm: Sustainable Practices

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

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

Comm/Comm: Smart Meters

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

Comm/Comm: Citizens United

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

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

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

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It’s a program that takes four years to finish – with one 10-day course completed each year at the Emmitsburg, Maryland campus. The curriculum includes: (1) executive development; (2) executive analysis of community risk reduction; (3) executive analysis of fire service operations in emergency management; and (3) executive leadership. Each year requires the completion of an applied research project.

Brow’s applied research project for 2010 was an analysis of fire risk caused by upholstered furniture placed on porches. The 48-page report was entitled: “Reducing the Risk of Couch Fires on Porches in University Off-campus Student Housing.” The Ann Arbor city council passed an ordinance on Sept. 20, 2010 that bans upholstered furniture from outdoor porches, if the furniture is not designed for that use.

In a phone interview, Tom Olshanski of the U.S. Fire Administration press office explained to The Chronicle that admission to the executive fire officer program is highly competitive – with around four applications for each of the 160 spots offered annually. The cost to firefighters who are enrolled in the course, Olshanski said, is limited to their food while on campus. USFA covers travel, lodging and the cost of the course itself. Since the inception of the program 24 years ago, around 3,000 firefighters across the county have completed the executive fire officer program, he said.

Reached by email, city administrator Steve Powers indicated that the city’s application had been for three firefighter positions for what he believed to be two-year grant period. Ann Arbor’s unit cost for a firefighter full-time equivalent is $79,599 per FTE. For a two-year grant period, that would translate to almost exactly four firefighters for each of two years. [642,294 /79,599 = 8.06]

Staff for Stabenow and Levin were not able to offer definitive information on the grant period.

Four additional firefighters would bring the total budgeted number in the city of Ann Arbor to 86. The city council approved a fiscal year 2013 budget on May 21, 2012 that provided for 82 firefighter positions.

As part of its approval of the fiscal year 2013 budget, the council passed a resolution that did not modify city administrator Steve Powers’ proposed budget. Rather, it directed Powers to bring forward an amendment to the budget in the future – in case the state of Michigan fire protection funding or the SAFER grant were awarded. The budget resolution directed the administrator to hire up to six firefighters, which in Ann Arbor’s department would amount to $477,594 ($79,599 per FTE). Adding six firefighters would bring the budgeted staffing to 88, which Ann Arbor fire chief Chuck Hubbard has said would be his target.

The council’s next meeting is June 4, 2012. Powers indicated in his email that the exact details of the grant term would be confirmed by May 31.

For a detailed account of the council deliberations on the budget, see Chronicle coverage: “Debate Details: FY 2013 Budget”

Update early May 31: According to city administrator Steve Powers, “The SAFER grant is for two years. The funding will allow the hiring of at least three firefighters and possibly four. Staff will need to review the official award to maximize the number of positions.”

Tony Derezinski (Ward 2) looks on as Jane Lumm (Ward 2) pleads her case for increased police staffing levels. Though Derezinski had little sympathy for Lumm’s amendment on police officers, he joined her in supporting a budget amendment to restore collection of loose leaves in the fall as a city service. The city now collects leaves and compost in containers instead of allowing residents to sweep piles of leaves into the street. The amendment failed. (Photos by the writer.)

The cumulative impact of the amendments approved by the council on May 21 increased general fund expenditures to $79,070,842 against revenues of $79,193,112, for a surplus of $122,270. The entire city budget, across all funds, was proposed at $404,900,312 in revenues against $382,172,603 in expenses. The fiscal year begins on July 1.

Jane Lumm (Ward 2) saw two of her proposed amendments fail – which would have funded five additional police officers from non-specific reductions in other general fund departments, and would have restored the service of loose leaf collection in the fall. She also opposed the addition of a court secretary position for the 15th District Court, which the rest of her colleagues agreed to add into the budget that evening. That combination prompted her to vote against the overall budget, saying it did not adequately prioritize public safety. She was joined by Mike Anglin (Ward 5) in voting against the budget.

But Mayor John Hieftje summarized the majority view on the council in framing this year’s budget as a reflection of public safety as a top priority of the city – because nearly half of the general fund is being spent on public safety, and the vast bulk of additional revenue for FY 2013 (compared to the forecast in last year’s budget planning) is being spent on public safety. Those investments in public safety prevented further reduction in budgeted firefighters (by five) and in police officers (by nine) – reductions that were originally called for in the two-year budget plan. Those investments also allowed the city to add one police officer.

However, former police chief Barnett Jones and current fire chief Chuck Hubbard have identified ideal targets for staffing levels for their departments that are higher than the budgeted levels for FY 2013. For the fire department, that’s 82 firefighters compared to Hubbard’s ideal 88; for police, that’s 119 sworn officers compared to Jones’ ideal 150. The point of disagreement on the council essentially reduced to this: Should the city take additional steps this year to reduce the gap in public safety staffing between current levels and the ideal targets?

One resolution approved at the meeting – which did not actually modify the budget – simply directed the city administrator to bring a future mid-year budget amendment to add up to six firefighters to the budget – if a federal grant and increased state fire protection allocations materialize. Although it would have been conceivable to pass a parallel resolution on the police side of public safety, there was no effort at the table (by Lumm or other councilmembers) to modify Lumm’s resolution  and stipulate that additional police officers would be hired, if a federal grant application were successful.

Voting for the budget were eight councilmembers, including Stephen Kunselman (Ward 3), who saw two of his own amendments fail. One would have interpreted the city ordinance on DDA TIF capture differently, which would have resulted in additional revenue to the city’s general fund – revenue sufficient to fund two firefighter positions. Also failing was an amendment that would have prevented the transfer of money to the public art fund from a variety of different sources. [The 8-2 overall budget vote on the 11-member council was due to the absence of Marcia Higgins (Ward 4) for the final vote. She attended the meeting and stayed for the better part of it, but succumbed to a persistent hacking cough before it ended.]

Although several amendments failed, others were approved by the council. Those included budget modifications that added a secretary position to the 15th District Court, increased human services funding by $46,899, added $78,000 to the Ann Arbor Housing Commission budget, and eliminated a contract with RecycleBank to administer a coupon program to encourage recycling.

The council’s budget discussion came in the context of a briefing from the city’s paid lobbyist in Lansing, Kirk Profit, who sketched an uncertain state budget picture, but offered compliments to the city’s approach to managing its budget.

Box-score style results on the budget amendments were previously covered in a report filed from the city council chambers on the night of the vote. Below we’ve summarized the deliberations by the council on the budget amendments. Items not related to the FY 2013 budget are detailed in Part 1 of this meeting report: “City Council Expands North Main Task Force.”

Background Concepts

The budget deliberations by councilmembers depended in part on some basic budget-specific notions. They include the idea of recurring versus non-recurring expenses and revenues, as well as the idea of “reduction targets.”

Background Concepts: Recurring versus Non-recurring

Councilmembers invoked the idea of recurring versus non-recurring revenue or expenses in arguing for and against different amendments.

A simple example of recurring revenue is money from taxes – the city levies taxes every year in a recurrent way. The exact amount might vary based on the economy, but the city’s tax levy will reliably generate money in a way that can be reasonably estimated each year into the future. A simple example of a recurring expense is an employee’s salary. When the city hires someone to do a job – like arrest criminals, or put out fires, or review proposed new buildings – our basic expectation is that we’ll have a recurring need to pay that person’s salary each year.

A simple example of non-recurring revenue is proceeds from the sale of land. When the city receives a $90,000 payment from the Ann Arbor Transportation Authority for a strip of land in downtown Ann Arbor, the city cannot reliably expect every year in the future that it will have an available strip of land it can sell and that someone actually wants to buy for $90,000. On the expense side, an example of a non-recurring item would be a payment made to induce a police officer to retire earlier than that officer would have otherwise retired. The following year, that payment would not need to recur – because the employee has already retired.

Background Concepts: Reduction Targets

During deliberations, Jane Lumm (Ward 2) identified departments for further cuts, based on failure to achieve their reduction targets. How are reduction targets developed?

At a Jan. 31, 2011 city council work session, Tom Crawford, the city’s CFO, explained this concept to councilmembers as a stepwise process:

1. Assume the same activities will be maintained next year at the same level they exist this year [staffing levels will remain the same; the same services will be provided; etc.].
2. Project to next year how much it will cost to maintain that same level of activity. [If the cost of electricity is expected to increase by 10%, that's calculated in; if union contracts stipulate that there's a 1.5% salary increase, that's calculated in.]
3. Compare next year’s projected cost with next year’s projected revenue. If cost exceeds revenue, that defines the percentage reduction the organization needs to achieve as a whole.

So it’s not a matter of looking at expenses last year and cutting that number by some percentage.

Budget reduction targets for each department and the amounts achieved toward meeting those targets are laid out in budget impact statements. [.pdf of budget impact statements]

Budget reduction targets factored into the first of several amendments, which are presented below in the order in which they were discussed.

Amendment: Court Secretary for 15th District Court

An amendment to add $76,193 to the 15th District Court budget in order to add a court secretary position was put forward by Christopher Taylor (Ward 3).

By way of brief background, Michigan’s district courts handle all civil claims up to $25,000, including small claims, landlord-tenant disputes, land contract disputes, and civil infractions. District court judges emphasize that their workload also includes preliminary exams for the circuit courts, as well as their own dockets. Washtenaw County has three district courts – 15th District Court for the city of Ann Arbor, 14B District Court for Ypsilanti Township, and the 14A District Court (with four physical venues) for the rest of Washtenaw County.

The state of Michigan pays salaries of district court judges, provided those salaries meet the guidelines set forth by the state. The city of Ann Arbor bears other costs for the 15th District Court.

The rationale for the added position was that it restored a job that had been eliminated when it was uncertain whether Gov. Rick Snyder would appoint a replacement for judge Julie Creal, who resigned in 2011. Joe Burke was eventually appointed on Feb. 15, 2012 to replace her. The argument for adding the position was essentially that Burke needs the support staff.

Taylor introduced the amendment and its rationale. Jane Lumm (Ward 2) noted that the 15th District Court had a reduction target this year of $94,617, but instead showed an increase of $40,783. With the additional court secretary position, Lumm said, the 15th District Court was around $212,000 over its reduction target. On that basis, Lumm indicated she would not support adding money to the court’s budget.

Sabra Briere (Ward 1) offered a perspective based not on the specific situation of the 15th District Court, but of courts more generally. She told her colleagues that as one of the other courts has lost staff members, it doesn’t affect the judges, as much as it impacts the people who come seeking services. Plaintiffs and defendants need to understand what’s going on, she said, which is part of the function of a court secretary. Her own reflex, Briere said, was not to support the addition to the court’s budget. But she felt that was a punitive rather than a reasonable response. When people come seeking assistance from the court, the city council needs to give the court the ability to provide that assistance.

Stephen Kunselman (Ward 3), responding to remarks by Briere and Lumm, characterized both of their sentiments as well-spoken. He said he found himself torn. He was under the impression that the number of court cases is declining. He wondered about the possibility that court secretaries could serve more than one judge each. He wondered if it were possible to fund the position in years ahead. [The amendment proposed simply to tap the general fund surplus anticipated this year, as opposed to identifying some additional recurring revenue.] Kunselman wished for more information about case loads in the court.

Keith Zeisloft, administrator for the 15th District Court, was asked to address the question of declining work load. He distinguished between citations and other kinds of work load definitions. Traffic citations, he allowed, have declined over the last several years from around 30,000 to 20,000. However, he noted that those are cases that are typically paid “across the counter.” A few are contested, he said, but predominantly they are paid in person or online. There’s also been a decline in misdemeanors. Zeisloft’s point was that the greatest decline has been in cases that have the least impact on the staff’s workload.

Zeisloft described a decrease in court staffing from 45 employees down to 29 over the last 10 years. He told the council that the court has shrunk its workforce as its case load has gone down. He described current staffing levels as a “skeleton crew.” The specific position that would be added through the budget amendment is a senior court secretary position, he said. But he then described how people in a variety of different positions pitch in to cover work in the court clerk’s office when their own work is done. The bailiff might be tasked for court clerk work, depending on the circumstances. The work is covered by moving people around. He described how the general principle is: If there’s nothing else you need to do for your judge, then go to the clerk’s office. In the event that the city council did not fund the position, he said, the blow is not to the judge, but it will ripple through the entire court.

Lumm followed up by inquiring about missed dockets. Zeisloft indicated that when the court was down one judge [when Creal resigned] the court had tried to be frugal by using a visiting judge frugally. Lumm said her understanding was that there had been missed dockets when the court was fully staffed with three judges. Lumm told Zeisloft the court has missed the savings target by a significant amount. Reduction targets were set for all departments, she said: Why set the target if you’re not going to hit it?

Zeisloft expressed regret that the court had missed the target that had been set. He assured the council that the court had worked over its budget and made every attempt to be as frugal as possible. He reiterated his regret that the court had missed its reduction target.

Outcome: The council amended the FY 2013 budget to add a court secretary position to the 15th District Court on a 10-1 vote, with Jane Lumm (Ward 2) dissenting.

Policy Resolution: Fire Protection

After approving the court secretary position, the next resolution offered by a councilmember did not actually amend the budget, but rather gave a policy directive to the city administrator to hire additional firefighters, but only if funding became available. The amendment came from Margie Teall (Ward 4), who was joined by Christopher Taylor (Ward 3), mayor John Hieftje and Jane Lumm (Ward 2) as sponsors.

The resolution was different in a significant way from a draft resolution earlier circulated by Teall, which amended the budget by adding to the budgeted expenditures the amount needed to fund six additional firefighters, bringing the total budgeted firefighters to 88. The number of 88 had been identified by fire chief Chuck Hubbard as ideal at a working session conducted on March 12, 2012.

The earlier draft specified money allocated by the state, as well as a federal grant, as funding sources, but used the city’s general fund to backstop the funding allocation. From the earlier draft amendment:

RESOLVED, the city increase the general fund fire services unit FTEs by six, and funding for the positions totaling $477,594 ($79,599 per FTE) be added to the adopted budget, funded from the receipt of additional fire protection monies from the state, potential grant funds and the use of fund balance, as needed, from the general fund.

In more detail, the funding for additional firefighters would potentially be a combination of a federal grant – for which the city has applied through a FEMA program called Staffing for Adequate Fire & Emergency Response (SAFER) – and possible increases in the state of Michigan’s fire protection allocation to municipalities that are home to state-owned facilities like the University of Michigan.

Policy Resolution: Fire Protection – State Grants

The fire protection grants from the state of Michigan are dependent on an allocation from the state legislature each year. The allocation is governed by Act 289 of 1977. [.pdf of Act 289 of 1977] The statute sets forth a formula for a state fire protection grant to all municipalities that are home to state-owned facilities – a formula that attempts to fairly determine the funding allocated for fire protection grants in any given year. The statute explicitly provides for the possibility that the legislature can choose not to allocate funds sufficient to cover the amount in the formula [emphasis added]:

141.956 Prorating amount appropriated to each municipality.
Sec. 6. If the amount appropriated in a fiscal year is not sufficient to make the payments required by this act, the director shall prorate the amount appropriated to each municipality.

That part of the statute did not inform the council deliberations that came later in the meeting – on the question of whether the city council could choose not to follow the requirements of the city’s public art ordinance, to transfer money from various city funds into the public art fund. Stephen Kunselman (Ward 3) claimed that the historical failure of the state legislature to allocate funds to cover the entire amount in the fire protection grant formula was an example of the state legislature failing to follow state law. Carsten Hohnke (Ward 5) countered by accepting Kunselman’s premise of the legislature’s “bad behavior,” but wondered why the council would want to copy bad behavior.

The fire protection grant formula, on which the prorated amount is based, defines the state grant for any municipality in terms of the relative value of the state-owned property in the municipality. More precisely, the percentage in the grant formula is the estimated state equalized value (SEV) of state-owned facilities, divided by the sum of that estimated value and the actual SEV of the other property in the community. For example, in Ann Arbor, the total SEV of property on which property tax is paid is roughly $5 billion. The estimated value of state-owned facilities (primarily the University of Michigan) is around $1 billion. So the percentage used in the state fire protection formula for Ann Arbor is about 16% [1/(1 + 5)].

The percentage in the formula is different for each municipality. That percentage is then multiplied by the actual expenditures made by a municipality for fire protection in the prior fiscal year.

So the formula can be described as equitable among municipalities – because the grant amount depends in part on the relative value of state-owned facilities in a given municipality. All other things being equal, a city with a greater number of state-owned facilities receives more fire protection grant money than one with a small number of state-owned facilities. The formula can also be described as equitable to the state of Michigan, because the formula calibrates the state’s investment in a municipality’s fire protection to the level of funding that a local municipality itself is willing to provide.

The roughly $14 million spent by Ann Arbor on fire protection last year would translate to a state grant of around $2 million. But the legislature allocated about half that amount. At a legislative briefing at the start of the council’s May 21 meeting, the city’s lobbyist – Kirk Profit of Governmental Consultant Services Inc. (GCSI) – described for councilmembers how this was an area he was focusing on. He expressed some very guarded optimism that fire protection grants could enjoy a higher level of funding by the legislature this year. However, he talked about attitudes in the legislature that range from advocating zero funding to full funding of the grants. He noted that the grants have not been fully funded in several years.

Policy Resolution: Fire Protection – Contingent Amendment

It emerged during deliberations that the version of the budget resolution offered by Teall at the meeting had not been circulated (by email) to other councilmembers until an hour and half before the council meeting’s scheduled start. It did not change the expenditure budget, but rather directed the city administrator to bring a budget amendment to the council later, if any increased funding becomes available:

RESOLVED, that Council directs the City Administrator to monitor the receipt of additional funding from grants and from the State’s fire protection funds; and
RESOLVED, that if additional funding is received during FY 2013 that the city administrator immediately present council with a mid-year budget amendment appropriating funds to hire additional firefighters up to 88 FTEs.

Jane Lumm (Ward 2) led off deliberations by saying it was no surprise that she supported Teall’s budget amendment [she'd circulated an amendment of her own adding fire protection].

Policy Resolution: Fire Protection – Addition to Amendment

Lumm wanted to amend Teall’s amendment in a way that she wanted to be accepted as “friendly” – which would not have required a separate vote. It was to add the second “resolved” clause in her own draft amendment:

RESOLVED, that if the revenues from the SAFER grant and increases in state fire protection grant do not total at least $477,594, that city council directs the Administrator to prioritize the funding of any shortfall in the development of the FY14 budget and FY15 plan.

Lumm characterized the additional clause as establishing a priority of identifying additional recurring revenues – in the event the two types of grant funding did not come through. She noted the high level of uncertainty about that grant revenue.

Teall said she was concerned that the funding described in Lumm’s clause did not identify it as “recurring.” Lumm explained that all her additional clause would do is state that if the additional grant funding did not materialize for fire protection, then finding additional funding is a priority. It’s all about whether this is or isn’t a priority, she said. Teall declined to accept Lumm’s modification as friendly. So Lumm offered the clause as a non-friendly amendment to Teall’s resolution, which meant that it was subjected to separate deliberation and a vote.

City of Ann Arbor CFO Tom Crawford confers with councilmember Margie Teall (Ward 4) before the meeting.

Sabra Briere (Ward 1) thanked Teall for the originally-proposed amendment. It was clear to her, she said, on reading the language of the amendment, that the council has directed the city administrator to hire additional firefighters. The problem she had with Lumm’s modification, she said, is that it presupposes that the additional firefighters have been hired [through use of the characterization "shortfall"] and that there’s a need to find recurring funds to pay for already-hired firefighters. That’s a “leap of logic” Briere said she had not managed to make.

Briere said it’s appropriate to talk about recurring funds and making the hiring of additional firefighters and police a priority if that’s what the council wants to do. But she felt it was not logically consistent to state what’s in Teall’s amendment, and then state that the council will make it a priority to have at least $477,594 to keep those people employed in future years.

Carsten Hohnke (Ward 5) agreed with Briere – he felt the council would be getting ahead of itself. It felt redundant to him. The priority on public safety was clear to the city administrator, Hohnke felt. He said that priority is clear from the fact that public safety continues to take up more and more of the general fund, as a percentage compared to other services. Lumm’s addition, he said, serves no real functional purpose.

Marcia Higgins (Ward 4) said she wouldn’t support Lumm’s addition to the amendment – because the council and the community will have a separate discussion for FY 2014 and FY 2015 budget years. While safety services will be an important priority, she said, the council will also want to hear about all the other priorities the community has. So she would not support Lumm’s change. Higgins didn’t want to tie the budget resolution this year to the next two-year budget planning cycle.

Lumm rejected the idea that the greater percentage of safety services expenditures from the general fund actually reflects a priority on safety services. That greater percentage, Lumm contended, was due to the way the composition of the general fund had evolved over time. The solid waste department had been moved out of the general fund, she pointed out. That had the arithmetic impact of making safety services a greater percentage of the general fund.

Safety services as a percentage of general fund expenditures – FY 2000 compared to FY 2011. The slide is from a 2011 town hall budget presentation by city staff. The key part of the pie chart label for FY 200o is “adjusted for current operations”– i.e., adjusted to eliminate solid waste from the activities in the general fund. (Image links to higher resolution .pdf file.)

Not much later in the deliberations, Christopher Taylor (Ward 3) returned to Lumm’s contention that the increased percentage of general fund allocations was an artifact of arithmetic, not a reflection of a greater priority on safety services.

Taylor asked the city’s chief financial officer, Tom Crawford, to the podium. Taylor noted that the information the council had been provided was that the general fund expenditures on safety services had gone from 40% to 50% in the last 10 years. Was that generally speaking right? Taylor noted that Lumm had suggested that the increased percentage is due to removal of activities like solid waste from the general fund.

Crawford explained that when the city compares those expenditures, activities that are no longer included in the general fund are factored out of years when they were previously included. And the effect of a greater percentage is still seen. It’s due to the fact that safety services have a high personnel expense related to those activities.

Mayor John Hieftje asked Crawford to confirm again that in these comparisons, the solid waste activities are eliminated from prior years – the years when solid waste activities were included in the general fund – so that the same activities are compared between years, and you still see that effect of an increased percentage for safety services.

Safety services as a percentage of general fund expenditures – from the FY 2005 budget book. The city’s budget book for FY 2005 describes how solid waste activity has been pulled out of the general fund and put into an enterprise fund that year. (Image links to higher resolution .pdf file.)

Lumm came back with a question for Crawford of her own: If solid waste were included in the general fund, would the percentage for safety services be as large? Crawford confirmed the arithmetic fact – no. “That’s my point,” said Lumm.

Hieftje again asked Crawford for confirmation that the city has presented the information in an apples-to-apples kind of way. Yes, Crawford said. Hohnke stated that it’s obvious that if solid waste activities were added in to the general fund, then safety services would make up a lower percentage. He noted that if you normalize the calculation as Crawford described, safety services still take up a greater portion of the general fund. Hohnke concluded that it’s hard to look at the council’s actions over the last few years and say there hasn’t been an emphasis on safety services. He allowed that you can argue it should have been more, but that it’s clear the council has prioritized safety services.

Teall said she appreciated the intent of Lumm’s addition to her amendment, but felt the clearest argument against it was by Higgins. There’s an opportunity to give direction to the city administrator before the draft budget is prepared for FY 2014, Teall said. Hieftje also felt there would be plenty of time to express priorities. He felt that city administrator Steve Powers already knows the council wants to prioritize fire and police.

Stephen Kunselman (Ward 3) said he wouldn’t support the amendment because it includes FY 2014 and FY 2015 – which is just way beyond what the council can see. Kunselman felt that the council doesn’t need this kind of policy statement for the budget.

Outcome on Lumm’s addition to the amendment: Lumm cast the sole vote for it.

Policy Resolution: Fire Protection – More Deliberations

Stephen Kunselman (Ward 3) expressed concern about the idea of identifying as general fund revenue some grants that were not certain to materialize. His concern was based on confusion about the actual text of the budget amendment put forward by Margie Teall (Ward 4). The new version, which she’d introduced, did not actually change anything in the expenditure budget, but simply gave direction to the city administrator to bring a budget amendment to the council if the grant money did materialize. That version, it was revealed, had not been sent by email to other councilmembers until around 5:30 p.m. that day. [Council meetings are scheduled to begin at 7 p.m.]

Carsten Hohnke (Ward 5) thanked Teall for working on the amendment. He supported the approach of anticipating additional grant funds and providing an action when those funds arise. Jane Lumm (Ward 2) said she was very excited to join in her support for that amendment. She said the city had 126 firefighters in 2001, which had dropped to 82 in this year’s proposed budget – for a 35% reduction, she said. Lumm expressed concern about the probability that grant funding would be available. She hoped that there will be an increase in state fire protection grants.

Mayor John Hieftje said he felt the city had made a lot of progress in being able to preserve the budgeted 82 positions and he expected that the fire department would be staffed up to its budgeted numbers by July 1. It’s not remarkable that Ann Arbor has fewer firefighters than it had previously, he contended. Compared to 2001, he said, there now are 2,400 fewer firefighters in Michigan. One of the reasons is that there are fewer fires in structures than there used to be, he said. It’s also one of the worst financial periods in our lifetime, he said. Hieftje said that the fire inspection work the city is now doing means not just additional revenue, but also that the city can prevent fires. He said it would be a good idea to have more frequent inspection of older housing stock rented by students.

Sabra Briere (Ward 1) noted that she wanted to find a way to increase fire protection but was uncomfortable using grant money or non-recurring money as a way to go forward. The city’s policy when she was first elected to the council was not to seek grant money, if the city did not believe it could get that grant money in the future. That was fine for then, she said. But times change and you have to “roll with that.” She was delighted to see this variant of a budget amendment, because it says that the city will hire additional firefighters if it gets the money it has sought. The goal, she said, is to bring the number to 88, and frankly, she said, 88 is where the city will start. Certainly no councilmembers feel comfortable at 82. If the city receives the SAFER grant and still hasn’t identified additional recurring funds, then councilmembers will have a much more interesting discussion, she felt.

Kunselman concluded the deliberations by noting that Teall’s amendment was a policy statement – but the council had just voted down Lumm’s addition amendment, on the grounds that it was a policy statement. He said he’d support the amendment – it makes the council feel good, but doesn’t actually amend the budget. “So let’s keep on track,” he said.

Outcome: The council unanimously approved the resolution on fire protection.

Amendment: DDA TIF, Firefighters

The next amendment was brought forward by Stephen Kunselman (Ward 3), who introduced it by saying that he felt it would be difficult to pass, because many people on the council were supportive of the Ann Arbor Downtown Development Authority. The council took that as a frame for the ensuing discussion, and did not delve into the specific substance of the resolution that related to Chapter 7, which regulates how the DDA’s TIF (tax increment finance) capture works.

Amendment: DDA TIF, Firefighters – Background

Downtown development authorities in Michigan do not levy taxes of their own, but rather “capture” taxes levied by other entities within a specific geographic area – the TIF district. The “increment” in a tax increment finance (TIF) district refers to the difference between the initial value of a property and the value of a property after development. Among other things, Chapter 7 sets forth how the Ann Arbor DDA’s tax capture is confined to the initial increment on the value of a property after improvements are made, and does not include subsequent increases due to inflation.

Last year, the impact of a specific clause was identified by city financial staff as having been previously overlooked [emphasis and paragraph number added]:

¶1 If the captured assessed valuation derived from new construction, and increase in value of property newly constructed or existing property improved subsequent thereto, grows at a rate faster than that anticipated in the tax increment plan, at least 50% of such additional amounts shall be divided among the taxing units in relation to their proportion of the current tax levies. If the captured assessed valuation derived from new construction grows at a rate of over twice that anticipated in the plan, all of such excess amounts over twice that anticipated shall be divided among the taxing units. Only after approval of the governmental units may these restrictions be removed. [.pdf of Ann Arbor city ordinance establishing the DDA]

That section of Chapter 7 resulted in a combined refund of roughly $473,000 from the DDA to the Ann Arbor District Library, Washtenaw Community College and Washtenaw County in 2011. The city of Ann Arbor chose to waive its $712,000 share of the calculated excess. It can be argued that the method used by the DDA to calculate the excess was incorrect, and the amount returned should have been even greater. [See Chronicle coverage: "Column: Tax Capture is a Varsity Sport"]

Subsequently, the DDA reversed its legal position and contended that no money should have been returned at all, making the method of calculation moot. The DDA’s position is based on the following clause of Chapter 7 [emphasis and paragraph number added]:

¶3 Tax funds that are paid to the downtown development authority due to the captured assessed value shall first be used to pay the required amounts into the bond and interest redemption funds and the required reserves thereto. Thereafter, the funds shall be distributed as set forth above or shall be divided among the taxing units in relation to their proportion of the current tax levies.

The DDA’s legal position appears to rely on ¶1 as referent of the phrase “as set forth above.” That interpretation allows for the possibility that ¶1 is not a limit on TIF capture to be paid to the DDA in the first place, but rather is meant to explain how money is to be returned to the district’s taxing authorities only after debt obligations are satisfied. That interpretation, however, makes it somewhat challenging to harmonize the terms “distribute” and “divide.” Another candidate for the referent of “as set forth above” is “a development plan and financing plan for the downtown district or a development area within the district” – mentioned earlier in Chapter 7.

Though it has received scant public discussion in the context of Chapter 7, the intervening ¶2 also appears to have a potential impact on the amount of TIF captured by the DDA:

¶2 After the then earliest dated bond issue of the downtown development authority is retired, the captured assessed valuation prior to the date of sale for that issue shall be returned to the rolls on the next succeeding tax levy.

Amendment: DDA TIF, Firefighters – Resolved

Kunselman’s amendment first stipulated that Chapter 7 would be interpreted in the same general way it had been interpreted last year, but specified a method of calculation for the excess that was different. Based on that method of calculation, the excess this year would recur and likely increase substantially in subsequent years.

RESOLVED, That City Council directs the DDA to interpret and apply Chapter 7 of City Code using:

• both real and personal property,
• the “realistic” capture projection from the 2003 DDA Tax Increment Financing (TIF) Plan,
• a cumulative comparison of projected capture to actual capture; and
• consideration of only debt service payments for TIF related projects (i.e. exclude all debt service for the construction, maintenance, and management of the City’s parking system).

RESOLVED, That City Council directs the City Treasurer to distribute future TIF revenue to the DDA only up to the amount that would be realized in the plan plus any increases that are permissible in Chapter 7;

RESOLVED, That City Council directs the City Treasurer to distribute the excess amounts of future TIF revenue to the taxing authorities from which they were captured; and

RESOLVED, That the increased revenue to the General Fund in the amount of $199,360 be utilized to increase the Fire Department expenditure authorization in FY 2013 and to increase the authorized number of Fire FTEs by 2 positions.

Based on this “cumulative” approach to Chapter 7, the amount of additional revenue to the city’s general fund will recur.

Here’s how the $199,360 described in the resolution was calculated. In FY 2013, Kunselman’s Chapter 7 interpretation would result in an excess TIF capture of $659,771. Of that amount, $399,146 would go to the city of Ann Arbor – with the other $250,000 returned to the other taxing jurisdictions. Those jurisdictions include the Ann Arbor District Library, Washtenaw Community College, and Washtenaw County. Of the city of Ann Arbor’s $399,146 portion, $249,198 would go to the general fund, with the remaining roughly $150,000 going into other city funds – distributed among all the city millage funds. Of that $249,198, $49,838 would be would passed through to the Ann Arbor Transportation Authority, leaving the city’s general fund with $199,360.

In subsequent deliberations, the $199,360 was incompletely characterized as the “city’s share” of the $659,771 – by Carsten Hohnke (Ward 5) and Sandi Smith (Ward 1). The city’s share, across all of its funds, would have been twice that – $399,146. Kunselman’s resolution, however, did not specify how the additional city funds would be used, except for that amount that would have accrued to the general fund. In Kunselman’s resolution, the general fund’s additional revenue was earmarked for hiring two firefighters.

Amendment: DDA TIF, Firefighters – Deliberations

Sabra Briere (Ward 1) asked Susan Pollay, executive director of the DDA, to come to the podium. Briere said when she first read the resolution, she thought: At least Kunselman has identified recurring income and there’s a benefit to the city’s budget for that. But Briere wondered what the impact would be on the DDA. She noted that a lot of people don’t understand what the DDA does. She said people think [erroneously] that it just manages the parking system. So Briere wanted to know what would not be done by the DDA if the money were tasked for firefighters.

Pollay addressed the specific resolution, and noted that only the debt service related to TIF projects would be factored in – not parking system projects. The Ann Arbor DDA, Pollay explained, was created in 1982 in large part to create parking structures – Ann Ashley and Liberty Square among them. So the idea of the DDA taking on debt to build parking structures has been interwoven in the concept of the DDA since its inception, she said. Pollay also pointed to the new contract the city council had approved last year, under which the DDA operates the city’s public parking system. That contract assigns the DDA responsibility for the debt service for the parking structures. From the contract:

The DDA, at its own expense, shall operate, maintain, pay related debt service, and keep the Municipal Parking System in good repair and the total expense of routine maintenance and repair in connection therewith shall be borne and paid by the DDA.

The total debt service for the coming year, Pollay said, is approximately $6 million and the TIF capture is anticipated to be around $3.6 million. So at this point the debt service is far greater than TIF capture. [On the DDA's interpretation of ¶3 above, that would mean that ¶1 would not apply.] Pollay also pointed out that the city council had agreed to backstop the DDA’s fund balance as part of the parking contract:

Through Fiscal Year 2015-16, should the DDA’s combined fund balance (excluding the Housing Fund) (“DDA Fund Balance”) fall below ONE MILLION DOLLARS ($1,000,000), as shown by the DDA’s annual audited reports, then DDA may reduce amounts payable to the City under Section 4(a) by amounts equal to the difference between the DDA Fund Balance and ONE MILLION DOLLARS ($1,000,000) (“Withheld Payments”), provided, however, that Withheld Payments shall not exceed (i) ONE MILLION DOLLARS ($1,000,000) in any given fiscal year; or (ii) TWO MILLION DOLLARS ($2,000,000) in the aggregate. …

The debt service has to be paid by someone, Pollay said. As a city resident, Pollay said, she understood the struggle to restore positions in safety services. It would be an unintended consequence of the resolution that in adding firefighters, the city might end up having to cover the debt service currently paid by the DDA.

Briere wanted to know what else, besides debt service, the DDA used TIF capture to do. Pollay said that paying debt service is a large part of what the TIF capture is used to pay for. She said the DDA has a very small staff – four people – to run a $20 million organization. [In addition to TIF capture, the DDA handles the revenue and expenses of the city's public parking system, including a 17%-of-gross payment to the city of Ann Arbor.] TIF money is used also for cash down payments for projects – for example, a couple million dollars is coming out of the TIF revenues for the underground parking garage on South Fifth Avenue. Pollay also described how the DDA has taken responsibility for curb ramps that have been installed in the downtown area as the result of an Americans with Disabilities Act lawsuit. Among the other activities mentioned by Pollay, which are funded by TIF, were upgrading of water mains, alley repairs, and sidewalk replacements. The DDA works hard to use TIF capture for the positive impact on the community, Pollay said.

Briere noted that if the DDA’s TIF capture were to be significantly reduced (by 18%, she calculated) the city would not be spending the money on the same items that the DDA would. That becomes, Briere said, as Lumm had described earlier in the evening, a matter of competing priorities. Pollay reiterated it’s the DDA’s position, based on the city’s own ordinance, that there is no TIF that should be given back to other taxing authorities, and she quoted ¶2 above. It’s the DDA’s position, Pollay said, that the $6 million in debt service should be paid before any TIF capture should be returned to taxing authorities. Those funds are committed, she contended.

Sandi Smith (Ward 1), who also serves on the DDA board, said that Kunselman’s resolution feels to her like the establishment of a policy in the middle of a budget discussion. She did not support it, for all the reasons that Pollay had given. Hearing that there was $659,000 less TIF the DDA would be capturing, but of that only $200,000 would be available to the city, led Smith to analyze that as a $459,000 loss to the city. [The idea is that the $459,000 that would otherwise be invested in the city of Ann Arbor by the DDA would now be given to other taxing jurisdictions instead of the city of Ann Arbor. That's not an accurate characterization – because of the $659,000 total, the city's share across all of its funds would be around $400,000. The $200,000 figure is just the amount that would accrue to the city's general fund.] The city is the beneficiary of the DDA’s TIF investments in infrastructure, Smith said.

Stephen Kunselman (Ward 3) reads aloud the amendment on DDA TIF capture as Christopher Taylor (Ward 3) looks on.

Kunselman observed that it’s always interesting how the DDA’s responsibility between TIF and parking is intermingled. If there’s a funding shortage, the parking rates get raised, he said. He felt it’s important to understand how much of the TIF is not being spent – because the DDA’s debt service is not “credit card debt,” rather it’s bond debt. There’s a schedule of payments, he noted.

That’s why, at a previous meeting, Kunselman had asked for the “actuals” for the DDA’s finances from the prior year. Unspent TIF money left over at the end of FY 2012 gets carried forward, he said, so the DDA has not spent that money. Therefore it can be used for safety services. Responding to Smith’s characterization of the issue as a policy discussion, Kunselman said it was not merely a policy discussion, but a budget amendment: “We’re amending the budget.”

Kunselman granted that the city’s general fund would benefit only by $200,000, but he wondered why the Ann Arbor District Library, Washtenaw County and Washtenaw Community College had to suffer. He wondered why the AADL had to send a letter to mayor John Hieftje saying that they disagreed with what was going on and asking the DDA and the city to work with the AADL. [Hieftje serves on the board of the DDA.] Kunselman said he did not feel that the AADL should have to sue to get an interpretation of Chapter 7. [The AADL has not announced any plans to litigate, though the library's leadership has reviewed the TIF distribution with their legal counsel.] He felt that the council should step up and do what’s right, to ensure that all of the city’s neighbors – the other taxing jurisdictions – get the money they deserve.

Kunselman then settled on a specific question for Pollay: How much fund balance from FY 2012 will be brought forward to FY 2013? Pollay said that at the end of this fiscal year there would about $1 million left in TIF. That’s money that has not been spent in this fiscal year, but may be obligated for next year’s activity, Pollay said.

Kunselman pointed out that the DDA would be capturing another $3.6 million in TIF next year as well. Pollay wondered if what Kunselman was saying was that there should not be a fund balance – which is not what the DDA’s auditors had told the DDA, she said. Kunselman noted that the DDA is not required to maintain a bond reserve for its debt. So if the fund balance is for things other than debt, Kunselman said that could be used to address public safety needs.

The DDA was formed in 1982 when the downtown was struggling, Kunselman said, but the downtown is no longer struggling in the way it struggled in 1982. There are now four very large buildings that will be completed in the near future, Kunselman said. [He was referring to the Landmark Building, The Varsity, City Apartments, and Zaragon West.] So that’s hundreds of thousands of additional TIF revenue that will be coming in. Those fund balances will continue to increase, he said, because it can’t all be spent on debt – because the debt repayment is on a schedule and can’t be pre-paid.

Kunselman felt there’s a lot of money in the DDA’s TIF capture that could otherwise be spent on public safety. He understood that his colleagues are supportive of the DDA. Kunselman concluded by saying he felt it’s important to distinguish between the DDA as a parking authority and the DDA as a state-enabled TIF-funded entity. Mixing the two, he felt, causes a lot of confusion.

Mayor John Hieftje, who sits on the DDA board in a position provided to the mayor by the DDA’s state-enabling act, noted that the DDA’s current plan includes drawing down fund balances to pay for major projects. Hieftje then reviewed several of the standard arguments for downtown development authorities – downtowns can be an important economic driver as a center of activity. Hieftje then cited a Chronicle op-ed column, which he described as characterizing Kunselman’s attitude toward the DDA as using the DDA as a “political punching bag.” Hieftje cautioned that this resolution was a punch that could come around and hit the city. [In fact, the column encourages councilmembers to give Kunselman's resolution more than a reflexive "political punching bag" analysis: "... Kunselman's amendment deserves more than that kind of knee-jerk reaction."]

Hieftje cautioned that if the DDA can’t meet its financial obligations, then those obligations become the city’s obligations. He pointed out that the DDA grants roughly $0.5 million a year to the city to help pay for the new police/courts building (also called the Justice Center). In that way, he said, the DDA is contributing to public safety.

Jane Lumm (Ward 2) agreed that there’s no question the DDA makes significant transfers to the city each year. She pointed to the 17%-of-gross parking revenue (around $2.8 million in FY 2012), as well as the $508,000 annual contribution to the bond payment for the police/courts building. The DDA contributes $230,000 for free police officer parking at the Ann Ashley structure, she continued. She said there’s a lot of basis for the idea that the city uses the DDA as an ATM. Lumm said she’s torn, because she’s a strong supporter of the DDA. But when she looks at what Kunselman is advocating, it’s all about how to interpret the TIF ordinance. She then ticked through the differences between Kunselman’s interpretation and the DDA’s. She reiterated that she was torn, because Kunselman had found a way to generate recurring funding.

Smith asked Pollay to characterize the DDA’s fund balance in terms of percentage of operating expenses. Pollay said that the DDA is working toward 14% this year. Smith ventured that the DDA had dipped as low as 8%. Pollay said that by raising parking rates, the DDA had increased the anticipated fund balance from 8% to 14%. Smith drew out from Pollay that the level recommended by the city’s CFO was 15%. The DDA is still shy of the recommended fund balance level, Smith said.

Responding to Smith, Pollay ventured that reducing the fund balance by the $600,000 would reduce the fund balance by a percentage point or two. Smith noted that TIF reserves for the DDA are allocated by resolution. Pollay confirmed that about $800,000 is allocated that way – $400,000 for affordable housing in Village Green’s City Apartments project at First and Washington, and $400,000 for Avalon Housing’s Near North affordable housing project.

Smith also drew out from Pollay that the Village Green project involves construction of a parking deck on its first two floors – a $9 million investment, out of which the DDA needs to find $1.6 million in cash. The rest will be bonded, she said. Smith concluded that there are a lot of projects already in the pipeline and it may be very risky to expose the DDA to the impact of Kunselman’s resolution – because it would fall outside of the DDA’s 10-year plan. Pollay said that the Chapter 7 resolution was not on anybody’s radar when the budget was approved or when projects were approved. It would have a big impact, she said. Smith asked Pollay if it were a possibility to say to Avalon that the DDA could not support the Near North project. Pollay allowed that where there are no dollars, you have to look at what you granted.

Carsten Hohnke (Ward 5) said he appreciated Kunselman’s efforts in bringing the resolution forward, characterizing it as a detailed and thoughtful look at how to consider priorities for the budget. But Hohnke said that to him, for the two-year period it amounted to forgoing a $1.2 million investment in the downtown for $400,000 of general fund benefit. [Hohnke was not factoring in the additional $300,000 benefit to other city funds.] To him, that didn’t make sense. Hohnke used Kunselman’s examples of the four large developments as evidence that the DDA has been very effective in using their TIF funds.

Hohnke said it’s important to take the long view, given that the city asks a lot of the DDA. The city expects the DDA to drive economic development and to support public safety, and to provide merchants with additional infrastructure for their customers by bringing new parking structures on line. Due to the DDA’s efforts, he continued, the city’s public parking system has increased value, and is deserving of “increased rent.” And that benefits the city directly in the 17%-of-gross revenues from the public parking system that the DDA now provides to the city under terms of the new contract, ratified last year, he said. Hohnke cautioned against undercutting the DDA as an economic development engine.

Mike Anglin (Ward 5) felt the issue needed further discussion with the DDA. He observed that Kunselman’s resolution might not have the votes to pass. It raises some serious issues, he said. The downtown continues to be a place that’s very attractive. Into the future, he said, the DDA’s TIF capture will increase. He said he would vote with Kunselman to make a statement of support, to say this discussion should come up during the next year.

Briere observed that over the last 18 months or two years, she’s heard a lot of complaints from downtown merchants about a lack of safety services. She’s attended meetings of the DDA where board members have said they’d really rather give the city money for safety services than anything else. The desire in the downtown area is to support the need for safety services. But what Kunselman’s amendment is really about is what mechanism the council wants to use to decide the DDA TIF capture. It’s a discussion that started last year, she said. When many councilmembers read the DDA’s TIF plan, she said, they felt like intellectually the council should have used the “realistic” instead of the “optimistic” or the “pessimistic” forecast in the plan. Looking at the effect of Kunselman’s resolution, she said, the council is making a decision about whether “to cut off our noses.”

Briere said she’d oppose the amendment reluctantly. Looking at the impact on the city’s budget, the amount the city would accrue would not equal the loss of funding and opportunity for the DDA, she said.

Kunselman told his council colleagues that he wanted to bring forward the resolution so that people know “there is a lot of money over there at the DDA that can be used for public safety services ….” He noted that many of the programs cited as evidence of the DDA’s success include the use of parking revenues. Parking structures and parking revenues are separate, he said. The DDA can raise parking rates, but the DDA can’t change the TIF capture other than to change the interpretation of Chapter 7.

When people talk about economic development, Kunselman said, he felt the Ann Arbor District Library is the biggest economic draws besides the University of Michigan. But the city is taking money from the ADDL – so the AADL struggles. He commented as an aside that he hopes the AADL builds a new library on top of the underground parking structure on South Fifth Avenue. Responding to the discussion of the grant to Avalon for the Near North affordable housing project, he wondered how that was possible, given that it’s located outside the DDA TIF district.

Pollay explained the DDA policy on housing investments within 1/4 mile of the district boundary. Kunselman ventured that the 1/4 mile distance is arbitrary and that “residents down my way” would love to have some DDA affordable housing investments. Kunselman then assured Pollay that he did not mean anything personally toward her. He concluded that he felt the DDA has $600,000 available in unrestricted TIF funds.

Lumm said that what she really liked about the amendment is the funding it provided. She felt that the element of policy that it included is entirely appropriate. She said she was torn, but would still support it.

Outcome: The council rejected the amendment with support only from Stephen Kunselman (Ward 3), Jane Lumm (Ward 2) and Mike Anglin (Ward 5).

Amendment: Eliminate $6,500 Council Travel Budget

By way of background, the amount of $6,500 in the council’s travel budget appears to arise out of an allocation of $550 for each of 10 councilmembers and $1,000 for the mayor. Two years ago on March 1, 2010, as the council was giving direction to then-city administrator Roger Fraser, a proposal was made to direct Fraser to eliminate travel for the mayor and councilmembers. The council decided on that occasion to preserve mayor John Hieftje’s allocation of $1,000.

Sabra Briere (Ward 1) traveled to the meeting with her council-issue laptop computer.

Sabra Briere (Ward 1) introduced the amendment along with its history from 2010. Jane Lumm (Ward 2) noted that the financial unit comprising the mayor and council had not met its budget reduction targets and the elimination of the travel budget seemed reasonable, because it’s not being used.

Tony Derezinski (Ward 2) said he’d never used any of the travel money, so he wanted to know if the travel money has been used much by anybody. The city’s CFO, Tom Crawford, told Derezinski that it’s been used very little. He noted that the Ann Arbor Downtown Development Authority had assisted with some travel expenses for councilmembers to attend International Downtown Association conferences, but that did not come out of the city council’s travel budget. Derezinski allowed it was fine that the resolution was symbolic, but he wanted to stress that the travel money was not being abused.

Hieftje indicated that his problem with eliminating the travel budget was that it meant that you can’t attend conferences or make use of educational opportunities unless you can afford it. The implication is that you shouldn’t be on the city council if you can’t afford it. He said he was particularly concerned that there would be at least two new councilmembers elected in the fall who might find it useful to have travel funds available to support additional education. In his memory, Hieftje said, it hasn’t been abused.

Marcia Higgins (Ward 4) said that travel funds are something most councilmembers never use. And it does not accumulate in future mayor/council budgets, but simply rolls back into the genera fund, she said. She noted that the Michigan Municipal League offers some good educational opportunities for elected officials. There’s not a person around the table who hasn’t paid out of their pockets to cover travel expenses, she said. She would not support the elimination of the travel budget, she said.

Briere appreciated her colleagues’ concern about out-of-pocket expenses. She said that when she was elected to the council, new councilmembers were never informed there was such a budget for travel or opportunities for training. As a member of council who is not wealthy, she continued, she had paid her own way to International Downtown Association conferences – even though the DDA offered to pay for it. She said she wouldn’t suggest anyone hold themselves to her standard. She allowed that elimination of the $6,500 won’t fix a budget hole or break the bank, but when the council argues over whether the city can afford sufficient fire and police protection, it looks like councilmembers are giving themselves a benefit. People will imagine that councilmembers are benefitting, she said. Just as it was symbolic to forgo the travel budget back in 2010, the resolution this year is also symbolic.

Sandi Smith (Ward 1) said that on the surface, she’d be in support this. She didn’t want to belabor it, but it’s $500 per seat. There’s plenty of people who could benefit from the Michigan Municipal League who want to learn how to do things. She wanted to see it stay in the budget. Christopher Taylor (Ward 3) indicated wholehearted agreement with the idea that the council needs to be like Caesar’s wife [i.e., above suspicion] on a wide variety of things. However, he said, the travel budget can help with councilmember education, and it’s proper to say that education is important and that councilmembers may not actually know everything.

Margie Teall (Ward 4) looks The Chronicle right in the eye, as Carsten Hohnke (Ward 5) in the background reflected the energy levels of many attendees by the end of the meeting, which concluded around 1:30 a.m.

Margie Teall (Ward 4) echoed the idea that travel and training is something that’s important. She took issue with the idea that the council should take the action because of any misperceptions that might arise. She knew the truth – that the travel money is used rarely. She would not vote to eliminate it because of what someone might think.

Stephen Kunselman (Ward 3) said he wished he’d known about this in 2006, when he was first elected to city council, so that he could have taken advantage of some educational opportunities. “Maybe I’d be more effective!” he quipped. A comment Briere had made inclined him to vote against eliminating the council travel budget – she’d said that it could be restored when the corner had been turned on the economy. He said that this year there’s a small surplus, so the council should reward itself with a little education.

Derezinski followed up by saying that the travel budget hasn’t been abused. He ventured that by taking advantage of educational opportunities, councilmembers could learn a lot of valuable things, including the difference between “governance” and “administration.”

Lumm – who is the newest member elected to the council, though she also served back in the 1990s – indicated that she went through in-house city orientation and that city staff had done a great job of orienting her. She felt that the travel budget was something the council could give up.

Outcome: The council rejected the amendment that eliminated the council’s travel budget. It got support only from Jane Lumm (Ward 2) and Sabra Briere (Ward 1).

Amendment: Add $46,899 to Human Services

The city of Ann Arbor does not provide human services directly, but rather makes an allocation to a range of different nonprofits in a coordinated funding model. The other entities in the model include Washtenaw County, United Way of Washtenaw County, Washtenaw Urban County, and the Ann Arbor Area Community Foundation. Last year, for FY 2012, the council amended the proposed budget to increase human service funding by $85,600. That amendment brought the total allocation to nonprofits providing human services to $1,244,629. Compared to the originally proposed FY 2012 human services amount, this year’s FY 2013 amount is about $39,000 greater. But that reflects a $46,899 decrease from the level to which the council amended the budget last year.

So the amendment brought the budget for human services funding back to the same level as last year. Sabra Briere (Ward 1) noted in a deliberation on a subsequent amendment that last year’s increased human services funding had been intended to be a one-time increase – but that nonprofits who receive the human services funding didn’t get that message. Margie Teall (Ward 4) expressed support for the resolution, from her perspective as the council’s representative to the executive committee of the Urban County.

The additional money was taken from the projected general fund surplus.

Outcome: The council unanimously approved the additional $46,899 for human services.

Amendment: One-Time Increase for AAHC

The next amendment considered by the council increased the budget of the Ann Arbor Housing Commission by $78,000 – to offset an increased cost of allocating retiree healthcare costs.

The increase to AAHC is intended to offset the additional costs to AAHC from the new method of allocating retiree health costs to different departments – based on where the liability is accruing. For the city’s general fund departments, this resulted in decreased costs this year totaling around $1 million. But for some organizations within the city, like AAHC, it resulted in increased costs. For detail on retiree cost allocation methodology, see The Chronicle’s coverage of a Feb. 13, 2012 working session.

Sandi Smith (Ward 1) introduced the amendment and stressed that it was a one-time transfer. As part of the context for the one-time support, she noted that AAHC has a relatively new executive director – Jennifer L. Hall. Jane Lumm (Ward 2) noted that the resolution talks about the one-time nature of the additional transfer. She wondered: If the council is flexible on this issue for the AAHC, why not in other cases?

Margie Teall (Ward 4), the council’s liaison to the AAHC, indicated that it’s her understanding that the director is okay with the one-time nature of the transfer. Teall said the council was, in fact, trying to play by the same rules. Just the one extension would be needed, she said. Tony Derezinski (Ward 2), who served as council liaison to AAHC before Teall, said that the last two AAHC directors had made substantial improvements. The general direction the city has taken with AAHC over the last few years has been not to “cut it loose,” but rather to “embrace it.” It’s important not to stop the progress that’s being made, he said.

Sabra Briere (Ward 1) appreciated Lumm’s comment about whether the allocation might become a recurring event. Briere allowed that last year the council had made a one-time-only additional allocation for human services. Even though it was meant to be one time, the nonprofits didn’t get that message. Briere said she didn’t regret that the council had added the human services funding again this year. For the AAHC, the difficulty arose because of the way that the city allocated retiree health care costs, and the AAHC didn’t realize it. The additional money the council had previously allocated to AAHC to hire staff could not be used to hire staff, if the council did not cover the increased costs that the city had caused, Briere said.

Stephen Kunselman (Ward 3) noted that it’s important to continue with the process, working with the AAHC. The housing commission continues to struggle, he said, but the commission has good leadership. The amount is small, compared to what the AAHC needs to do, which is to rehabilitate a lot of housing stock at considerable expense, he said.

Outcome: The council unanimously approved the additional $78,000 for the Ann Arbor Housing Commission.

Amendment: Eliminate Contract with RecycleBank

RecycleBank administers a coupon-based reward program that is intended to increase rates of curbside recycling in the city. At its Sept. 19, 2011 meeting, the city council voted to retain the contract it had signed the previous year with RecycleBank. Leading up to that vote, there had been some interest on the council in canceling the contract entirely – because it was not clear that the impact of the coupon-based incentives was commensurate with the financial benefit to the city. But the council settled on a contract revision that was favorable to the city. The cost of continuing the contract this year would be $103,500. The cost of canceling is $107,200 – $90,000 in an equipment purchase settlement in accordance with terms of the contract and $17,200 for 60 days of contractual notice. Savings will be realized in subsequent years.

Amendment: RecycleBank – Public Commentary

During public commentary, near the start of the meeting, RecycleBank regional account manager Duane Maladecki reviewed some of the history of RecycleBank’s relationship with the city of Ann Arbor.

In September 2010, the city and RecycleBank started a 10-year contract. After one year, RecycleBank proposed a contract adjustment – a 33% ($50,000 per year) downward adjustment in cost, to help save money for the city, Maladecki said. The original $0.52 per house per month was reduced to $0.35 per house per month – with a $50 incentive for every ton of additional recycling above a reset baseline. The baseline was reset, to acknowledge the city’s switch from a dual-stream system to a single-stream system plus wheeled carts, which was implemented at roughly the same time as the RecycleBank program.

Maladecki said the reset baseline essentially assigned the 36% “lift” in recycling to the single-steam and cart program. The new baseline, he told the council, was set at 944 tons/month. However, RecycleBank had recently discovered that the new baseline was incorrectly calculated using data from the city – because it included both multi-family and commercial recycling weights. He reported that between December 2011 and June 2012, the recycling levels were expected to be 5% above the new baseline. That translated into a benefit to the city – due to saved disposal costs and commodity revenue – of about $21,000, he said.

Maladecki continued by reporting results of surveys that were done by the city and RecycleBank about what kind of rewards program participants wanted. After June, he said, RecycleBank would offer the opportunity for participants to contribute to local nonprofits – Leslie Science and Nature Center, Huron River Watershed Council, and the Ecology Center – as well national donation opportunities. He also described how RecycleBank would be providing a new suite of reports after June. He concluded by saying that he looked forward to a continued partnership with the city.

Amendment: RecycleBank – Council Deliberations

Sabra Briere (Ward 1), who had helped to bring the budget amendment forward, described a number of questions that had been raised – about how many people are actually using the coupons, and how much they are benefiting. She did not express much enthusiasm for the new option Maladecki had described for making local donations, characterizing it as an opportunity to donate points to a nonprofit of someone else’s choosing. She said the coupon program was not something she felt is resulting in something positive in the community. Residents are enthusiastic about the switch to a single-stream cart system, but have not embraced the coupon rewards program with the same passion, she said.

Carsten Hohnke (Ward 5), who had co-sponsored the amendment, declined to characterize the council’s decision to enter into a contract with RecycleBank at the same time it implemented the single-stream cart program as a bad decision. Instead, he said that good decisions don’t always lead to good outcomes. It’s incumbent on the council to re-evaluate things. He compared the re-evaluation of RecycleBank to the city’s experiment with reduced street lighting. The city had swiftly acted to restore the street lighting. Hohnke said he did not see the positive impact of the RecycleBank program reflected by increased numbers – certainly not enough to justify spending $100,000 a year for the next 10 years.

Margie Teall (Ward 4) asked city solid waste manager Tom McMurtrie to the podium to describe the effects he’d seen on recycling numbers from the RecycleBank program. McMurtrie allowed that in hindsight, it would have been better to separate the timing of the implementation of the single-stream program and the RecycleBank coupon program. The data show healthy increases since the start of the programs, but how much increase is the result of which program was difficult to say.

McMurtrie suspected there would be some drop in recycling numbers with the cancelation of the RecycleBank contract, but he could not estimate what that would be. Teall drew out the fact that the implementation of the RecycleBank program had extended only to single-family and duplex housing, not multi-family units. McMurtrie noted that assigning reward points to shared carts would be a challenge.

Sandi Smith (Ward 1) rejected the idea that it would be too difficult to assign reward points with a shared cart. With single-family carts, it’s possible to set out an empty cart and still receive credit for participation, she said. She’d have preferred to have started the program in multi-unit locations, where residents are younger or newer in town. As far as diminished participation upon cancellation of the contract, however, Smith didn’t think people would choose to throw something in the garbage instead of recycling it, if they did not receive reward points.

Briere agreed with Smith’s sentiments that the wrong audience (single-family households) had been targeted.

Marcia Higgins (Ward 4) felt that University of Michigan students are already committed to recycling and that the Ann Arbor Public Schools system is doing a great job at teaching the city’s young people about recycling.

Jane Lumm (Ward 2) expressed disappointment that there are no savings in the first year.

Stephen Kunselman (Ward 3) was dismissive of the value of the coupons that he’d received, and drew out from McMurtrie a description of the city’s recycling educational efforts – which include advertising and a periodic publication called “Waste Watcher.”

McMurtrie pointed out to the council that in the RecycleBank contract, there’s a $90,000 cancellation fee that applies this year, but at the end of the third year (next year) that goes to zero. Briere exclaimed that the city would pay the same amount – to keep the service another year, then cancel – compared to canceling now. Kunselman said he wasn’t willing to extend the contract another year. Residents who want coupons have plenty of opportunities. He encouraged the solid waste department to promote recycling to the multi-family housing units in partnership with Recycle Ann Arbor. He said he’d vote “to can the RecycleBank program.”

Christopher Taylor (Ward 3) felt the marginal cost ($13,000) of keeping the program another year then canceling, compared to canceling now was reasonable. He said he’d be willing to extend another year, then re-evaluate next year with a skeptical eye.

Teall said she’d also like to see the RecycleBank contract extended one more year.

Outcome: The council voted to cancel the RecycleBank contract, with dissent from Margie Teall (Ward 4), Christopher Taylor (Ward 3) and Tony Derezinski (Ward 2).

Amendment: Eliminate $307,299 in Transfers to Public Art

This proposed amendment stipulated that the transfers from various city funds into the public art fund would not take place, “notwithstanding city code” – a reference to the city’s Percent for Art ordinance. The Percent for Art ordinance requires that 1% of all capital improvement projects, up to a cap of $250,000 per capital project, be set aside for public art. The amendment would have prevented the transfer of $60,649 out of the drinking water fund, $22,400 out of the stormwater fund, $101,750 out of the sewer fund, and $122,500 out of the street millage fund. The council had re-debated the city’s public art ordinance most recently at its May 7, 2012 meeting, in the context of funds for a sculpture in the Justice Center lobby, which were ultimately approved.

Stephen Kunselman (Ward 3) introduced the budget amendment. He said that the funds from which the money was being transferred are the core of public safety, health and welfare. He recalled that the council has been addressed by residents who’ve had problems with stormwater and with their basements flooding. Councilmembers hear about streets being in bad shape. Granted, there’s a lot of work being done this year, he said, but that’s one reason the city needs to have money in the street millage fund – because there is so much work yet to do.

In defense of not following the city code, which requires the fund transfers, Kunselman cited the remarks by Kirk Profit, the city’s lobbyist, at the start of the meeting. Profit had described the state’s fire protection grant program, requiring the funding of grants to municipalities based on a formula. Historically, the legislature has not funded the full amount in the formula.

However, the statute places the requirements on the budget director, not on the legislature. The statute also explicitly provides for the possibility that the legislature can choose not to allocate funds sufficient to cover the amount in the formula [emphasis added]:

141.956 Prorating amount appropriated to each municipality.
Sec. 6. If the amount appropriated in a fiscal year is not sufficient to make the payments required by this act, the director shall prorate the amount appropriated to each municipality.

Kunselman contended that as city councilmembers, they could not have their hands tied. He pointed out that his resolution did not take any funds away from the Percent for Art program that had accumulated from past years, or say anything about future years. In that respect, Kunselman noted that the resolution was similar to one that mayor John Hieftje had said at an earlier meeting that he would eventually bring forward. Hieftje’s resolution, described at the council’s May 7, 2012 meeting, would transfer $50,000 from the city’s public art fund to the general fund. The rationale for the transfer was this: Of the money that had gone into the public art fund as a result of the municipal center (police/courts Justice Center) project, $50,000 could be linked to the general fund.

Kunselman recited some of the legal arguments that have been made against the city’s public art ordinance, citing the Bolt v. City of Lansing court decision from 1998.

Hieftje responded to Kunselman’s invitation to follow through on his expressed intention to bring forward a resolution that would transfer $50,000 of public art money back into the general fund. Hieftje said he would not be bringing forward the resolution, because it would be a violation of the public art ordinance. [On May 7 when Hieftje announced that he wanted to bring forward such a resolution, it was clear to observers of that meeting that Hieftje's proposal foundered on the same legal problem that a resolution of Jane Lumm's did – which related to her desire to cancel the Justice Center lobby art project.]

Tony Derezinski (Ward 2) characterized the budget amendment as “attacking public art.” Sandi Smith (Ward 1) noted that the council had debated the merits of the public art ordinance before. This time it’s in a slightly different form, but she felt the community had spoken loud and clear that art is a priority. Smith noted that she herself had brought a resolution forward in the past to reduce the percentage allocation to public art – from 1% to 0.5%. But she reported that when this has come up, 98% of the communication she receives is in support of the public art ordinance, and 2% is not. She felt that it speaks volumes that one of the community’s priorities is art.

Responding to Kunselman’s appeal to the state legislature’s failure to allocate sufficient funds for fire protection grants, Carsten Hohnke (Ward 5) said it’s not clear to him, if the state legislature engaged in bad behavior at the state level, why the city council would want to copy that behavior? Hohnke called the public art ordinance a significant contribution to the quality of life and economic development in the community. He told Kunselman that it’s Kunselman’s prerogative to suggest a change to the public art ordinance itself, but he ventured that they knew how that would turn out. Hohnke indicated that he felt Kunselman’s amendment was an indirect attempt to change the ordinance.

Sabra Briere (Ward 1) said she appreciated the comments of Smith and Hohnke, but did not agree with the idea that the community is uniformly in support of the ordinance. She characterized the community as “still divided.” She hears from many people that it’s not something they support. The public art ordinance is not universally beloved, she said. While councilmembers had received a lot of positive comments, some had also heard negative comments. And that is why Kunselman is encouraged to keep bringing the issue back up, she said.

Jane Lumm (Ward 2) stressed that the budget amendment is not a permanent change to the public art ordinance.

Kunselman noted that his fellow councilmembers had voted down a request to direct the city attorney to provide written legal opinion on the issue of the fund transfer that the budget amendment sought to prevent. He reiterated his argument about the ability of the council to act, regardless of the city code. He contrasted the legal basis of something and the “righteousness” of what’s important. He felt that what’s important is to make sure the money is used for public safety, health and welfare, not for an object to sit on the side of the road.

Hieftje then took a shot at Kunselman’s use of the word “righteousness,” saying that it sounded like Kunselman was giving a sermon. Hieftje said he’d be willing to entertain yet another conversation about the public art ordinance in the appropriate context. Hieftje drew a parallel between Kunselman and Congressman John Dingell by saying that every year since 1955, Dingell had introduced federal legislation to establish a single-payer health care system – but Dingell did that only once a year.

Hohnke said that if the council were to discuss the ordinance explicitly, then any revisions the council identified would trigger the appropriate public hearings and would allow the council to hear the public’s voice on the issue. Hohnke conceded that there had been no public referendum on the public art ordinance. But there had been a lot of informal as well as formal discussion to explore the utility of the Percent for Art ordinance for Ann Arbor, he said. Passing the budget amendment effectively amended the ordinance in violation of the city code, Hohnke said, cutting out the public’s voice.

Outcome: The council rejected the amendment that prevented the transfer from various city funds to the public art fund, with support only from Stephen Kunselman (Ward 3) and Jane Lumm (Ward 2).

Amendment: Restore Non-containerized Leaf Collection

Until 2011, the city of Ann Arbor offered an option to residents for the pickup of leaves, which allowed residents to sweep their leaves into the street for collection. The city collected the leaves using street sweepers as pushers, front-end loaders and rented large-volume trucks. The city offered two such pickup days for all parts of the city. As part of the general strategy for moving to wheeled carts for all types of curbside pickups (including garbage and recycling) – which can be serviced by a robot arm controlled from a truck cab – the city made compost carts available to residents. The city also still picks up leaves that are “containerized” in paper bags.

The budget amendment proposed by Jane Lumm (Ward 2) would have restored the loose leaf collection, which she called a basic service, as well as the holiday tree pickup, which she called a convenience.

The restoration of mass leaf collection would have made one-time use of $383,000 and recurring use of $275,280 from the solid waste fund.

The one-time use of funds would be for purchasing two sweeper/pusher vehicles. The amendment also called for recurring use of $275,280 to pay for labor/equipment costs. Of that amount, $25,204 would have gone to fund the curbside pickup of holiday trees. The amendment called for a range of different savings within the solid waste fund that might have been used to fund the recurring costs, including savings from eliminating the RecycleBank contract.

Jane Lumm (Ward 2) addresses the council as Christopher Taylor (Ward 3) looks on.

After introducing the amendment, Lumm noted that for many residents, mulching and composting isn’t a viable option. She said there’s $8.5 million in the solid waste fund balance – about 60% of annual expenditures, when the recommended target is 12-15% target.

Sandi Smith (Ward 1) said she’d heard very little discussion when the program was eliminated and hadn’t really heard any complaints since then. She liked the fact that the streets aren’t clogged with piles of leaves. In her neighborhood, she said, her leaves didn’t get picked up – because people parked on top of them. She ventured that the cost of the holiday tree pickup on a per-tree basis was fairly expensive, even if the total cost was low.

Mayor John Hieftje asked what the plan is for the fund balance in the solid waste fund? Craig Hupy, interim public services area administrator, described a future vision of a drop-off center to the east of the current compost site. Part of the fund balance would go to that project when the economy turns around and the city found a willing partner. Hupy also noted that if state legislation is enacted that allows for compost to be placed in landfills, the city’s current compost operator could walk away from that operation. The city would be left in a position where it has to replace equipment to go back into that business. That would cost about $1 million, he said. During subsequent deliberations, Hieftje said he felt it was likely that the state legislation allowing the landfilling of compost would be enacted.

The city also previously had “floors” on commodity prices for recycled materials, Hupy said. When commodity prices fell, the city was protected. Those kind of minimum price guarantees are no longer common in the market place, he said.

Hieftje asked city administrator Steve Powers if he thought it would be wise at this time to make the expenditures Lumm was suggesting. No, Powers said. Lumm then began an extended argument in support of her amendment. She said that the recurring expenditure required would be only 0.2% of the annual solid waste expenditure budget of $14 million. She went on long enough that Sandi Smith (Ward 1) raised a point of order. [Council speaking turns are limited to five minutes for the first turn and three minutes for the second turn.]

Lumm asked Hieftje if she could finish her remarks, to which Hieftje responded that she could. She continued at some length. Lumm said that in contrast to Smith, she’d heard many complaints and that when she was campaigning last year, many people had told her “Just pick up my ‘blank’ leaves!” Finally, Carsten Hohnke (Ward 5) raised the speaking time point of order again, saying, “Jane, you’re really abusing this.” Hieftje then declared a two-minute break in order to check some numbers with the financial staff.

When deliberations resumed, Stephen Kunselman (Ward 3) quizzed Hupy on why the two additional street sweepers would need to be purchased. They’d be used as “pushers” because of their maneuverability. Kunselman appreciated the homework that Lumm had done on the issue. He ventured that it might be possible to pilot some kind of limited service for mass leaf pickup in neighborhoods that have a lot of trees.

Sabra Briere (Ward 1) put the solid waste budget in the context of various future options the city might be mulling for altering its solid waste services – “pay to throw” options or charging per service run to pick up trash. She described various alternatives people used when the mass leaf collection service was eliminated, including having children rake leaves. Margie Teall (Ward 4) said her understanding was that the loose leaf collection in the streets was a stormwater issue. Hupy allowed that plugged storm drains can be an issue.

Christopher Taylor (Ward 3) picked up on Briere’s comment about children raking leaves, offering the view that the utility of children raking leaves can be overstated, if your purpose is to have your leaves raked. When the loose leaf collection program was eliminated, he said, some people said it was good idea, while some people regretted the loss. The fund balance of the solid waste fund, he said, does not represent a slush fund. Even if the money is not plainly allocated, it’s held back for future purposes. With uncertainties faced in the solid waste fund, he felt that it’s a nice service that the city can’t afford.

Tony Derezinski (Ward 2) joined his ward colleague Lumm in supporting the amendment. [Derezinski is up for re-election this year and faces a challenge in the Democratic primary from Sally Petersen, who was in the audience at council chambers as the council deliberated on the budget.] Derezinski characterized the leaf pickup as a very meaningful service, pointing also to the age of people who live in Ward 2. Ward 2 needs the service more than Ward 1 does, he said. He described the large backyards of some of the houses in Ward 2.

Hohnke quipped that he had sympathy for the large backyards of Ward 2. In the overall context of the budget, restoration of the leaf collection was not something he could support. Like many councilmembers, he also pointed to problems in the service, when it was offered, including concrete blocks getting swept into piles of leaves, which damaged equipment.

Kunselman ventured that maybe there’s a way to accommodate the difference in city wards, and the services that are needed in each ward. He would like to see a closer drop-off point for holiday trees, for example. He suggested that some “touch” of the previous services could be brought back. He had seen pictures of leaves piled high in cul-de-sacs, he said. But Lumm’s amendment, he said, would not “get us there tonight.”

Among the problems inherent in the mass leaf collection, Hieftje noted, was that the leaves don’t fall on schedule.

Mike Anglin (Ward 5) praised Ward 2 for making a great contribution to the city. There are services Ward 2 residents don’t use as much as other residents, so based on the idea of equity, he’d vote for Lumm’s resolution.

Outcome: The council rejected the mass leaf collection amendment. Joining Jane Lumm (Ward 2) in support were only Tony Derezinski (Ward 2) and Mike Anglin (Ward 5).

Amendment: Add Five or 10 Police Officers

This amendment would have added up to 10 sworn police officers – five to be funded through a federal Community Oriented Policing Services (COPS) grant and five to be funded through reductions in other departments.

The five positions to be added through the COPS grant would have been added only if the grant were awarded. The other five positions would have been funded from non-specific cuts to other city general fund departments: mayor and council ($8,957); 15th District Court ($94,617); public services ($192,265); and human resources ($35,939). The amendment also called for higher cost recovery for officers for which the Ann Arbor Transportation Authority (AATA) contracts. And the amendment called for use of money designated for a high speed rail grant match.

The amendment was brought forward by Jane Lumm (Ward 2).

Stephen Kunselman (Ward 3) said he’d support the amendment. Police services are a priority, he said, and the public comment was moving to him.

Amendment: Add Five or 10 Police Officers – Public Comment

The public commentary to which Kunselman had referred came from Esther Choi at the start of the meeting. She told the council her family had called Ann Arbor home for more than 30 years. She and her brother had attended Thurston Elementary and Clague Middle School, and had graduated from Huron High School. She returned to Ann Arbor to finish her graduate degree, she said, and was married in a church right down the street. She gave birth to two children at the University of Michigan hospital. She and her family are deeply rooted in Ann Arbor, she said.

Choi told the council about a situation involving her father, who on April 9, 2012 was working at the Broadway Party Store, which the family owns. Her father was robbed with a sawed-off shotgun, she reported. Before that, she said, her father had also been robbed countless times. After each incident, her father had provided assistance to the police, but no one had been apprehended. The store has been in the family for 30 years, she said. Over that time, sometimes it took the Ann Arbor police as long as 25 minutes to travel 0.7 miles, take a description, but never return or get a positive resolution. Her father and grandfather had taken matters into their own hands, she said. They’ve chased down perpetrators. Her father had resorted to throwing a cash register at a robber. Her grandfather had to be taken to the hospital after one incident.

The latest incident is the last straw, she said. She asked the council for help in devising a plan to make this area of Ann Arbor safer. She told the council that she knew that Ann Arbor doesn’t stand for this kind of behavior. Channel 7 covered the story and has called AAPD, but has not received a return call, she said. These are not petty crimes, she said – they’re life-threatening. Ann Arbor does not stand for this kind of behavior, she said.

During a break in the meeting, interim chief of police John Seto approached Choi, who was seated in the audience, and assured her that the department was aware of the case. It’s being worked on, he said, telling her that he’d get her an update from the detective who’s working the case.

The April 9, 2012 robbery of the Broadway Party Store was one of three robberies of a business involving a gun in the month of April in Ann Arbor (green in the bar chart below).

Data on all types of robberies, including attempted robberies, from crimemapping.com from February 2011 through April 2012. (Image links to higher resolution file. )

Amendment: Add Five or 10 Police Officers – Deliberations

Sabra Briere (Ward 1) noted that the tentative aspect of grant funding had made her uncomfortable with the similar resolution on fire protection. She noted that one of the funding sources was a reduction in the 15th District Court budget – but the council had just allocated additional money for the courts that evening.

Regarding the placement of priorities, Briere said, there’s about $1.4 million more in the general fund expenditure budget than there was a year ago – and almost all of it is going into public safety, she said.

The ensuing deliberations by councilmembers tried to draw out how the non-specific reductions might be implemented. That included debate on a grant for high speed rail and another point of order raised about Jane Lumm (Ward 2) exceeding the speaking time limit.

At one point, mayor John Hieftje held up a copy of the December 2011 Ann Arbor Observer, saying that “crime is down.” He felt there was not an emergency. Hieftje highlighted the fact that the University of Michigan has 55 sworn officers that should be counted in the total. He’d like to have more police officers, he said, but this year instead of fewer officers as planned, the city had budgeted for one additional officer.

Mayor John Hieftje holds up a copy of the December 2011 Ann Arbor Observer in support of his contention that crime is down.

Stephen Kunselman (Ward 3) said he appreciated Hieftje’s reference to the fact that crime is down – but contended that the need for enforcement is greater than ever. Kunselman ventured that “We can say crime is down, or we can say enforcement is needed.”

Carsten Hohnke (Ward 5) said his problem with the amendment was that it proposed cuts from the budgets of specific departments without identifying how the cuts would be made.

Christopher Taylor (Ward 3) also felt that the administrator and the council have prioritized public safety by using the lion’s share of the increased general fund budget this year to fund public safety. He disagreed with Kunselman – who’d contended that police officers could be used as a revenue source through issuance of citations. Taylor said he saw additional officers as used for fighting crime, not raising revenue. Taylor said it’s not operationally responsible to “cut by fiat.” He called it short-sighted to reduce the high-speed rail grant match – for that project, he said, “we should be going great guns.” To “gut” it at this time, he said, wasn’t feasible.

Briere established that the city has, in fact, submitted its application for the COPS grant. Interim deputy chief John Seto confirmed that in 2011 the city had applied and was turned down – but the city has renewed that application. If the city received the grant, it would fund five entry-level police officers for three years. He characterized the grants as “very competitive.”

Outcome: The budget amendment to add police officers got support only from Jane Lumm (Ward 2) and Stephen Kunselman (Ward 3).

Amendment: Count Golf Support as Parks Support

The background to this proposed amendment is a 2006 administrative policy approved by the council in connection with the parks maintenance and capital improvements millage. Among other things, under the 2006 administrative policy, general fund support for parks will decrease only in concert with the rest of the general fund budget.

The council has revised the 2006 administrative policy twice previously. On May 17, 2010, the city council revised the 2006 administrative policy to eliminate the natural area preservation program’s automatic 3% increase, and reset NAP funding to levels proportionate with other programs. And on May 16, 2011 the council revised the 2006 administrative policy to allow non-millage funds to count as general fund support for the parks, for purposes of the policy that requires general fund support. The parks maintenance and capital improvements millage will likely be put on the ballot for renewal in the Nov. 6, 2012 general election.

The result of the other budget amendments that the council passed on the evening of May 21 would have triggered a need to adjust parks funding upwards by $49,000. The budget amendment on golf support did not change the 2006 administrative policy. Rather, it stipulated that the $272,220 included in the FY 2013 budget proposal as a transfer to the golf courses covered the adjustment (the $49,000) that would have been required to meet the 2006 policy.

Carsten Hohnke (Ward 5) introduced the resolution and its rationale. Sabra Briere wanted to know what would happen if the council defeated the resolution. And Stephen Kunselman (Ward 3) said he was inclined to put another $49,000 into the parks system – he was sure the parks could use it. He asked CFO Tom Crawford if the council would need to pass another budget amendment in order to do that.

Crawford told Kunselman that he would need to confer with the legal staff on that. Hohnke allowed that the resolution was coming late in the game. Jane Lumm (Ward 2) later noted that the email with the amendment had been sent at 1:07 a.m. Hohnke said he could not imagine how general fund support for a golf course would not count as support for parks and recreation.

Christopher Taylor (Ward 3) said he did not know what the original intent of the fairness resolution was, but it struck him that the golf courses are a parks function – to him, that is a plain fact, not a violation of anyone’s trust.

Outcome: With dissent from Stephen Kunselman (Ward 3), the council approved the resolution that resulted in no additional general fund contribution to the parks system.

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

Next council meeting: Monday, June 4, 2012 at 7 p.m. in the second-floor council chambers at city hall, 301 E. Huron. [Check Chronicle event listings to confirm date]

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Changes to the retirement system include: (1) increasing the pension contribution of command officer members to 6% from 5%; (2) implementing a pick-up feature as permitted by the Internal Revenue Code for the pension contributions of firefighters and command officers, converting their 6% pre-tax contribution to a 6% post-tax contribution; (3) increasing the vesting and final average compensation requirements for firefighters hired after July 1, 2012; and (4) implementing a federal provision that allows eligible retired public safety officers to pay qualified health insurance premiums directly from their pensions.

The change to the retiree health care system stipulates that new hires after July 1, 2012 will be eligible for an access-only health care plan at the time of their retirement, instead of a city-paid retiree health care plan.

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