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

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

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

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

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]

Ann Arbor city councilmembers Sabra Briere (Ward 1) and Tony Derezinski (Ward 2). (Photo by the writer.)

Part 1 of this meeting report focuses just on the medical marijuana-related items. In a separate article, The Chronicle has analyzed some of the key issues at stake: “Ann Arbor Marijuana Licenses: Who Decides?”

In front of the council for its consideration were three separate agenda items involving medical marijuana: (1) revisions to the city’s medical marijuana licensing ordinance as recommended by the licensing board; (2) direction to the city planning commission to make a recommendation on revisions to the city’s medical marijuana zoning ordinance; and (3) direction to the city attorney to delay enforcement action against dispensaries.

The council unanimously postponed consideration of the licensing ordinance revisions until June 18 – the council’s second meeting that month. During deliberations on the licensing ordinance, several councilmembers expressed concerns about the board-recommended revisions, in particular one that would allow the city council to waive requirements of the licensing ordinance for a dispensary.  In postponing, councilmembers wanted to give the planning commission enough time to act on its direction to review the medical marijuana zoning ordinance and give a recommendation to the city council. The intent is to bring forward any changes to the licensing and zoning at the same time.

The direction to the planning commission passed on a 9-1 vote, with dissent from the Tony Derezinski (Ward 2), who is the city council’s representative to the planning commission. [Marcia Higgins (Ward 4) was absent, leaving the 11-member council with 10 members present.]

The council tabled the resolution directing the city attorney to delay enforcement activities. The tabling was achieved on a 6-4 vote. Voting against the tabling were mayor John Hieftje, Sabra Briere (Ward 1), Margie Teall (Ward 4) and Mike Anglin (Ward 5). A tabled resolution will demise if it’s not brought back for consideration in six months.

The medical marijuana licensing board made recommendations on the award of licenses to 10 dispensaries at its  Jan. 31, 2012 meeting. Given remarks made at the council’s April 2 meeting by Sandi Smith (Ward 1), Carsten Hohnke (Ward 5) and Stephen Kunselman (Ward 3), there’s some sentiment in support of having the council go ahead and vote on those recommendations – before the council considers ordinance revisions in June. But it’s not clear whether the city attorney’s office would be prepared before June to provide advice on the license awards.

This report includes coverage of public commentary and council deliberations on the medical marijuana items, presented in detail. Other agenda items from the April 2 meeting will be included in a separate forthcoming report.

Medical Marijuana: Public Commentary

Luis Vazquez told the councilmembers he was standing before them as an Ann Arbor resident. He noted that he paid a lot of money in taxes. Of all the things the city attorney could and should be spending time and taxpayer money on, the recent actions of the city attorney on medical marijuana dispensaries are questionable – in light of the desire of Ann Arbor residents to have safe access points for medical marijuana, he said. He reminded the council that in 2004, three out of four Ann Arbor voters supported the city charter amendment on medical marijuana, which city attorney Stephen Postema claimed at the time was unenforceable. In 2008, around 4 out of 5 Ann Arbor voters supported the statewide ballot initiative on medical marijuana – it’s an overwhelming majority of Ann Arborites who are saying they prefer an end to the drug war, he contended.

The number of patients who legally use marijuana – and who applied for their patient cards – has outstripped the ability of the state of Michigan to process the paperwork in a timely fashion, Vazquez said. That may force some patients to use the black market to obtain their medicine until they can find a caregiver or find a way to grow their own. Vazquez said that in his view, Michigan attorney general Bill Schuette has vowed to thwart the will of the state’s voters by dragging patients and caregivers into court and proposing that the legislature change the Michigan Medical Marijuana Act to make it more difficult for patients to exercise their health care rights. To hear Schuette arguing for continued prohibition is like listening to Al Capone arguing for continued prohibition of alcohol, Vazquez said. Schuette’s actions have now prompted a ballot petition to legalize all uses of marijuana, he said.

Vazquez continued by saying that the city attorney should not be using his taxes to support the misguided and political actions of the state’s attorney general. He concluded by suggesting that the council consider three actions: (1) require that the city attorney’s office cease and desist action against dispensaries operating in Ann Arbor; (2) place on the ballot for the November 2012 election a measure similar to that passed by Kalamazoo voters – that the city charter be amended so that consumption or use of less than 1 ounce of marijuana by adults is the lowest priority for law enforcement personnel; and (3) appoint a marijuana regulatory commission, which would set quality standards, maximum prices, licenses and other fees, and an enforcement apparatus.

Jamie Lowell spoke on behalf of the Michigan Association of Compassion Centers (MACC). He thanked the council for being so steadfast on medical marijuana issues and working to resolve the challenges that have come up. He pointed out that the Michigan Supreme Court has decide to hear the appeal of the McQueen case. MACC has been invited to file an amicus brief in the case, he said. The court of appeals ruling on the McQueen case has served to cause more confusion and disagreement about how the state medical marijuana act impacts what a municipality may or may not do, he said.

MACC contends that the judges on the court of appeals lacked foundation and erred in their decision, Lowell said. He also indicated that MACC interprets the court of appeals ruling to be narrower than the interpretation by the attorney general and by some prosecutors and city attorneys. So MACC was not surprised when the supreme court decided to hear the case and take a closer look at it. Lowell said it would be appropriate for the council to set aside any implications that the McQueen case is thought to have had, until the supreme court rules.

Lowell also pointed out that state legislators are working on a “local option bill” entitled the Michigan Medical Marijuana Provisioning Center Act. Some legislators backing the bill are part of a bipartisan workgroup. The legislation would require a simple majority to pass (as opposed to the super-majority that would be required to change the voter-approved Michigan Medical Marijuana Act), so they believe it’s viable. During MACC’s discussions with state legislators, Lowell said, he’s repeatedly heard Ann Arbor cited as an example of a community that has embraced the opportunity to help citizens with their health care.

Nancy Wright Maxwell introduced herself as a 30-year Washtenaw County resident. She told the council that she was speaking in support of dispensaries. She said she’d been active her whole life, and she allowed that people might not think she looked like the face of the medical marijuana movement. She’s been a competitive athlete her whole life, she said, and has been playing national tournaments for the last 10-20 years. She’s had a lot of surgeries – three knee surgeries and two hip surgeries. She has chronic pain, she said.

Because she’s a senior executive for an insurance company and travels all over the world, she has limited options, Maxwell said. Vicodin isn’t a viable option, she said, citing the effects on the liver. She said that because she’s an athlete, she doesn’t want to smoke – so having safe, reliable dispensaries that she can trust is important. She doesn’t want to grow marijuana, she said, and did not want any part of that. She’d shown her 73-year-old conservative Grosse Pointe parents her registry card, and said it was a place of pride that she is legal. She said it’s important to be able to walk into a dispensary and get a little “medible,” that takes the edge off her pain so she doesn’t have to take Vicodin. She can no longer take the level of Advil that she’d been taking.

Maxwell allowed that she’d made the bed she was sleeping in with respect to her choice to engage in athletics. Ann Arbor is one of the most amazing places in the world to live – she wants Ann Arbor be a part of the cutting edge of having the model that will allow people to be helped. She allowed that some people will abuse it, and that’s unfortunate, but that’s a reality of every type of business.

Mitchell Elkiss began by saying he’d be offering a slightly different perspective – as a health care provider, a physician. So he had watched the emerging and evolving science of medical marijuana over the years, demonstrating its safety and efficacy. As a caregiver, he takes care of a lot of patients with chronic pain. He also suffers from chronic pain.

So with his doctor’s guidance, Elkiss had identified safe alternative therapeutic options that can be integrated into a whole complex of caregiving. With respect to dispensaries, if you’re going to write or fill a prescription, you need a quality source of whatever it is you’re going to use, he said. It needs to be a reliable source over time, each time you go. It has to be obtained in a safe and secure manner. So one of the things that distinguishes a dispensary from a single caregiver is that a dispensary can offer variety – different strains, medibles and tinctures. That’s not something a single caregiver can legally secure by himself. Elkiss told the council he’s a member of OM of Medicine, an Ann Arbor dispensary, and noted that the professionalism with which the dispensary conducts itself is part of the experience.

He reviewed the importance of finding a safe, effective alternative for the adjunctive use of medical marijuana, noting that it has to be done in a safe and reliable way, requiring special places where the products can be regularly of high quality.

Laurel Hufano introduced herself as a 33-year-old Ann Arborite, born and bred. She loves Ann Arbor and it’ll always be her home, she said. She felt very passionate about it being a safe, tolerant and welcoming place. She’s glad the University of Michigan and its hospital are located here.

Hufano had originally received her patient’s card in 2009 – she has arthritis and disc degeneration in her lumbar spine, along with a misaligned kneecap. She’s also suffered from migraines since she was 20 years old. So she has lived with chronic pain for some time. This year she was diagnosed with idiopathic inter-cranial hypertension. She’s had no positive response from various medications.

Having a medical marijuana patient card has made a world of difference in terms of making her daily pain livable, she reported. Dispensaries are important, because she needs a safe place that she can trust and access easily, and that is accountable to the city and that’s there to support patients. The center she visits has given her better care than many doctors, she said.

Drew Driver addressed the council from a wheelchair. He told the council he has a spinal cord injury. His primary care physician was barred from writing prescriptions for medical marijuana because of the hospital group he was with. So he recommended another doctor. Together they decided that medical marijuana was a good choice to deal with his muscle spasms, his pain and his lack of appetite.

Medical marijuana provides relief for him, Driver said. He said that although he visits Ann Arbor on a regular basis, he’s actually from Gaylord, about four hours north of Ann Arbor. After learning that medical marijuana helped him, he embarked on a mission to help others relieve their pain in a way so that they felt safe. He worked with his local city council, city police, county officials. They had a half dozen meetings about what they’d do – his goal was to have safe access and get dispensaries licensed and zoned properly. They’d come up with rules and regulations that worked for their town – they didn’t want a big marijuana leaf on the signs, for example. They didn’t want dispensaries within 500 feet of schools – that sort of thing, he said. It was a great experience for him, he said, because it got him involved in government and they all worked together and had a good outcome.

They had not actually written city ordinances, because at the time, Gaylord was worried they’d write an ordinance and they wouldn’t have control one way or another. His point, Driver said, was that a lot of other municipalities look to Ann Arbor for guidance – his own community had done that. There would be a lot of other cities who look to Ann Arbor as a leader on this issue. State legislators would also look to Ann Arbor as a leader.

Medical Marijuana Licensing Ordinance Revisions

The council was asked to consider a set of licensing ordinance revisions that had been recommended by the medical marijuana licensing board at its Jan. 31, 2012 meeting. Those recommended changes are included in the report that the licensing board subsequently submitted to the city council. [In the presentation below, the language recommended to be added is in italics, and language recommended for deletion is struck through.]

Licensing Revisions: Completeness, Conditions

The issue of completeness of applications is one that has been a chaffing point between the licensing board and the city staff. City staff were reluctant to present the board with license applications that they did not consider complete.

The licensing board agreed at its Jan. 31 meeting to recommend that the explicit role of city staff in determining completeness of applications be struck from two places in the ordinance [added language in italics; deleted language with strike-through]:

7:504 (4) Following official confirmation by staff that the applicant has submitted a complete application City Council approval of the issuance of a license, a new license shall not be issued to a medical marijuana dispensary until the applicant for the license complies with all of the following requirements…

7:505. If the applicant has successfully demonstrated compliance with all requirements for issuance of a license within 10 weeks (70 calendar days) after the date of City staff’s official confirmation that the application for a license was complete City Council’s approval of a license, the city administrator or designee shall grant renewal of an existing or issue a new license…

At the licensing board’s Jan. 18 meeting, the idea was entertained to remove staff from part of the process, by requiring that all the application materials be forwarded directly to the board, instead of to the city planning staff. Ultimately, the board weighed the volume of actual work it would take for board members to handle application materials, concluding it was more than a clerical task.

The board also agreed to a recommendation making explicit that there is flexibility in the kind of conditions that can be set.

7:502 (7) … The Board shall annually send to City Council a proposed resolution recommending either approval or rejection of each complete license application. A recommended resolution may set conditions for approval. The conditions may include a waiver by City Council of any provision or provisions of the licensing ordinance, and/or the imposition of a new provision or new provisions, if the public interest so requires.

Licensing Revisions: Entry for Inspection

The board agreed to recommend a change to make explicit that requests from the city to inspect a dispensary would be complaint-driven:

Pursuant to a complaint, an authorized person shall consent to the entry into a medical marijuana dispensary by the Building Official and zoning inspectors for the purpose of inspection to determine compliance with this chapter pursuant to a notice posted in a conspicuous place on the premises two (2) or more days before the date of the inspection or sent and by first class mail to the address of the premises four (4) or more calendar business days before the date of the inspection.

Licensing Revisions: Number of Licenses, Frequency of Recommendation

At its Jan. 31 meeting, the licensing board grappled with the tension between having a single annual recommendation on licenses (as the ordinance now specifies) versus a rolling recommendation as applications are submitted. The board agreed not to suggest changing from the process described in the ordinance as an annual recommendation for the award of licenses.

The board settled on capping the number of licenses at 20, which is the maximum number specified in the ordinance for the first year.

… but not more than 20 medical marijuana dispensary licenses shall be issued in the first year and shall be capped at that number.

Also recommended was a standardization of the timing requirements for applications – in some places there’s a 70-day condition but in others it’s a 90-day condition. The board agreed to recommend making that timing requirement uniformly 90 days.

Licensing Revisions: Council Deliberations

Sabra Briere (Ward 1) is the city council representative to the medical marijuana licensing board, so she led off the deliberations by reviewing how the licensing ordinance revisions had come to the council. She summarized them by saying that most of the changes were clarificational, but called her council colleagues’ attention two substantive changes – the cap at 20 licenses and the council’s ability, in the context of a license recommendation for a specific dispensary, to waive provisions of the licensing ordinance or add a new provision to the licensing ordinance.

Because only 10 dispensaries had applied in the first year, the board saw no reason to increase the number. With respect to the ability of the council to waive or add provisions to the licensing ordinance, Briere said it was not a recommendation about what provisions should be waived or added.

Sandi Smith (Ward 1) asked Briere what the impetus was for imposing a cap. Briere explained that the cap of 20 had been established by the council for the first year only. The board had been asked to recommend a number going forward. The recommendation to set the cap at 20 amounted to a recommendation to make no change, Briere said.

With respect to the other revision to allow waivers and additional requirements, Briere described how there was rigidity with respect to the way some people were attempting to apply the ordinance to existing conditions. Because those conditions weren’t being applied by the council (the governing body), she said, but by city staff just trying to figure out the right thing to do, the board didn’t want to say what new conditions might indicate making a waiver, but felt it should be within the council’s authority to do that without conflicting with the ordinance. What you run into, she said, is the licensing board’s sincere effort to anticipate things that can’t be anticipated.

Carsten Hohnke (Ward 5) asked Briere if she thought it would be useful to separate out the proposed actions into different motions. He identified the change that would make inspection “pursuant to a complaint” as one that some people might feel is substantive, as well as the two that Briere had identified. Briere responded by saying that one of the possibilities was not to vote on the changes that night. Her bias was to take up any changes to the zoning ordinance at the same time as the licensing ordinance.

Tony Derezinski (Ward 2) said he was somewhat troubled by the revision that would allow for the waiver or imposition of an additional requirement by the city council. He characterized it as amending an ordinance through a simple resolution. [By the city charter, ordinance revisions require votes by the council at two separate meetings and a public hearing before the second vote. A resolution can be passed by the council at a single meeting.] He said he had concerns about that. The licensing ordinance was, he said, to say the least hard fought and well thought out. There were a lot of compromises that were made, he said. He was troubled by the idea of altering an ordinance through a simple resolution and would not support it on that basis.

Jane Lumm (Ward 2) also expressed concerns about the idea of waiving provisions of the licensing ordinance. She wanted to understand what the change was meant to accomplish. She found it of concern to be routinely waiving ordinance provisions. Briere told Lumm that Lumm was understanding the ordinance “moderately correctly.” But Briere went on to clarify that she did not know if the licensing board felt very strongly about whether there should be a specific ordinance change associated with a waiver or a new provision. The board did feel that there were no criteria given for granting a license, and the lack of criteria of evaluating a license created a clear conflict “of the board.”

That is, Briere said, board members felt like all they could do, more or less, would be to see if all elements of the applications were present. There were not criteria offered by the council in the ordinance. And the board didn’t develop criteria, because the board didn’t have any guidance to develop criteria. As a result, she said, the board felt that if the council wants criteria, it should be able to say, for example, this dispensary would be too close to that dispensary, even though no criterion has been set that says dispensaries can’t be within 500 feet of each other.

Briere reiterated that her preference would be to introduce the revisions and then postpone them, to discuss zoning changes at the same time.

Lumm followed up with a question about the revisions that would strike language about the completeness of applications. She wondered why the change was needed. She felt that before council could act, it needs to know if the application is complete. Briere explained to Lumm that what the change does is ensure that the council has a consistent role. It’s the council that approves a license, not the staff, Briere said. The change clarifies what the final step is. The council won’t consider an application that hasn’t been through the licensing board, she said.

Mayor John Hieftje remarked that if the council were going to postpone the licensing ordinance revisions, he didn’t want to spend a lot of time discussing it that night.

Licensing Revisions: Council Deliberations – Postponement

Briere then made a formal motion to postpone the licensing ordinance revisions. She suggested that the postponement be to a date no later than the middle of June. The reason for the ambiguity was because of the subsequent resolution that the council would be considering, that asks the planning commission to evaluate the zoning ordinance for possible changes. She did not want to put pressure on the planning commission to act.

Christopher Taylor (Ward 3) wondered if a postponement to a date certain could be achieved with a “not later than” phrase. Hieftje suggested making it June 18 – the second meeting in June.

Derezinski said he supported the postponement. He wanted to see the issue he’d raised addressed [about the idea of essentially revising an ordinance through a resolution]. The ordinance language had gone through “a meat grinder, or a sausage grinder,” he said, so to amend it by a simple resolution in the context of a license approval gave him a lot of concern. That gives the council a lot of latitude to act in the “public interest,” he said. Derezinski expressed concern about the vagueness of that phrase, as well.

Stephen Kunselman (Ward 3) also supported postponement. He said he shared Derezinski’s concern over the waiver of a provision of the licensing ordinance. It struck him as far-reaching, he said.

Outcome: The council unanimously postponed the medical marijuana licensing ordinance revisions until June 18.

Direction to City Attorney on Enforcement

On the council’s agenda was a resolution to “delay all enforcement activities against medical marijuana dispensaries and cultivation facilities except for claims that they violate Section 5:50.1(3) of the City Code [zoning regulations], until the Council amends or rejects amendments to the zoning and licensing ordinances for medical marijuana.”

The resolution had been twice-previously postponed. On March 5, the council did not arrive at the agenda item until after midnight, due to lengthy deliberations on the four-party countywide transit agreement. So on that occasion the council opted to postpone until they were mentally fresher. And on March 19, three of 11 members were absent, and the prevailing sentiment on the council was that postponement would be appropriate, in order to allow those three absent members to vote.

Direction to City Attorney: Background

To evaluate compliance with the Michigan Medical Marijuana Act (MMMA), the city attorney’s office required that dispensaries submit with their license applications a clear statement of exactly how their business models would conform with the MMMA. [For analysis of the role of the city council compared with the role of the city attorney and the licensing board in the licensing process set up by the city council, see "Ann Arbor Marijuana Licenses: Who Decides?"]

For example, Cannabis Counsel, the attorney for MedMarx at Arborside, included a statement explaining its MMMA conformance in the wake of Michigan v. McQueen (Compassionate Apothecary). An Aug. 23, 2011 court of appeals ruling on the case has been interpreted by many authorities to mean that no medical marijuana dispensaries are legal. [.pdf of letter from Cannabis Counsel regarding Arborside's business model] The McQueen case has been accepted for review by the Michigan Supreme Court, which means that it’s not yet settled case law. And the broadest interpretation of the McQueen case – that it bans all dispensaries – is itself controversial.

The Cannabis Counsel letter lays out why the court of appeals in the McQueen case found that the Compassionate Apothecary business model was not in compliance with the MMMA: The problem was that Compassionate Apothecary did nothing to “assist” patients in administering or using marijuana, beyond exchanging marijuana for money. In contrast to Compassionate Apothecary, argues Cannabis Counsel, Arborside does assist patients in the manner described by the court – by assisting the patient “in preparing the marihuana to be consumed in any of the various ways that marihuana is commonly consumed.” Those ways include providing patients with “cleaned prepared de-stemmed cannabis including pre-rolled joints, medibles which have been inspected, tested, cleaned, grinded and rolled, or cooked in combination with foodstuff.”

The Ann Arbor dispensaries met the city’s request to submit with their applications an explanation of their compliance with the MMMA. And on Jan. 31, 2012, the city’s medical marijuana licensing board voted to recommend licenses to 10 dispensaries. Yet after that, when dispensary owners felt like they’d completed the application process with the final step to be a vote by the city council, the city attorney’s office sent out letters demanding additional data.

Among the questions posed to all dispensaries in the letters are the following: “Does any person or entity deliver marijuana to [Dispensary Name]? If so, does [Dispensary Name] ever pay, donate, or in any way give money to the person or entity who delivers the marijuana or to anyone else? If so, to whom is the money paid, donated, or given and how much?” [.pdf of set of letters]

Dispensaries have balked at the additional data request, arguing that the information is sensitive and the collection of such data by the city was explicitly removed by the city council during the legislative process that resulted in approval of the licensing and zoning ordinances. But the city is currently not granting Chapter 55 zoning compliance permits to license applicants – on the grounds that compliance with the MMAA cannot yet be verified.

The licensing board met on Feb. 24 in response to the new letters, and asked that the resolution, which the council was considering for the third time on April 2, be voted on by the council.

Direction to City Attorney: Deliberations

Sabra Briere (Ward 1) led off deliberations by sketching out the background of the licensing board’s meeting on Feb. 24, describing it as an unanticipated meeting. The board felt very strongly that the role of the city attorney’s office needed to be clarified, and the only body that can do that is the city council, Briere said. [The city attorney is one of two positions hired directly by the city council. The other position is city administrator.]

Sandi Smith (Ward 1) expressed sympathy with the intent of the resolution, but wanted to offer an additional resolved clause that would allow the resolution to be rescinded at any regular or special meeting called for that purpose. That amendment was accepted as a “friendly amendment,” which did not require a vote of the council.

Tony Derezinski (Ward 2) cited the same issue he’d raised earlier, in connection with the proposed licensing ordinance revisions – it’s a resolution that has the effect of changing an ordinance the council has passed. It says don’t enforce the law as the council wrote the law, Derezinski contended. With respect to the idea that the enforcement would be delayed until the council decides what to do, Derezinski felt that’s pretty “loosey-goosey” and that it left open the possibility that enforcement could be delayed for quite some time – until licensing ordinance revisions are decided on. The council had passed an ordinance, and the city attorney is obliged to enforce it, Derezinski said, so he’d be voting against the resolution.

Addressing the amendment proposed by Smith, Carsten Hohnke (Ward 5) asked if it’s an action reserved for the council in any case – to call a special meeting and rescind a resolution. Briere confirmed that was the case – it’s a belt and suspenders approach.

Responding to Derezinski’s concern about the indefiniteness of the delay in enforcement, Briere pointed out that by its decision to postpone the ordinance revisions until June 18, there was a date in the future by which time the council expected the issue to be settled.

Christopher Taylor (Ward 3) stated his belief that the status of medical marijuana in the state law as currently articulated by the courts is inconsistent and at odds with the way that most Ann Arborites would like it to be. He included himself in that view. That resulted in a tension between the council’s action and the state of the law generally. He characterized the resolution as “wandering towards” that tension and seeking to resolve it. But he said he did not believe that the council should do that. The council is a body that is subordinate to state law. The council has also enacted local laws and he felt that until the council chooses to change the law, the law should be enforced. So he said he would not support the resolution.

Mike Anglin (Ward 5) asked for clarification of the request of a delay. He asked what information the city attorney was requesting of dispensaries – was it information that’s supposed to be protected? Briere confirmed that this was the case. The letter sent by the city attorney’s office requested the names of individuals involved in providing medical marijuana to dispensaries and other information as well. She said that for her part the line was crossed when the city began seeking information that it’s not supposed to be seeking.

As the legislation was being crafted, Briere noted that the council had talked about whether to require dispensaries to maintain lists of patients or people growing marijuana. The council learned that if it did collect such a list, it would in any case not be able to confirm that someone was allowed to grow marijuana, or have a patient card, because that information is restricted and the state would not release it. For the city’s purposes, they could not match a name with patient or caregiver numbers.

Briere said she could appreciate the desire of the city attorney’s office to verify that a dispensary operation is in compliance with the Michigan Medical Marijuana Act, but indicated she felt it was as difficult for the city attorney’s office to do that as it was for the licensing board to develop any criteria by which to evaluate applications.

It shouldn’t be sufficient that someone merely fills out all the paperwork in the right order in order to get a license, she said. But the board didn’t try to set criteria, because there were so many other issues in front of the board. The city attorney’s office is, through its recent letter, trying to set those criteria – which includes the collection of information that the council had agreed it shouldn’t collect. That caused a problem for the licensing board and it caused a problem for her, Briere concluded.

Derezinski invited city attorney Stephen Postema to tell his side of the story, because he’d been mentioned as the staff person involved. In an aside to Derezinski, Briere pointed out that she’d cited the city attorney’s office, not Postema.

Postema then spoke at length on the issue, characterizing his office’s letters as simply trying to verify that a dispensary is in compliance with state law. He argued that the council should be considering whether to award licenses to dispensaries recommended by the licensing board, not thinking about revising the licensing ordinance.

… frankly I don’t know why, under the ordinance, the business licenses aren’t before the council. Ordinarily they’d come there. So again, this is all sort of backwards in one sense, because what they’re trying to do is get a license. They can’t operate right now, they’re not allowed to operate at all – without a license. And that is what they should be wanting to be in front of you, so you can rule on it. So if they do comply with state law, they can get a license. So asking them for basic information is part of what needs to be there. And that’s nothing surprising. The fact that the licensing board somehow took offense to this, that’s because they’re operating in a different realm in some ways than what I’m being asked to do. So there’s nothing surprising there.

[Postema's claim that the lack of a license, while an application is pending, precludes operation of a dispensary is contradicted by the ordinance language, which specifically allows a dispensary to operate while its application is pending. For more detail, see "Ann Arbor Marijuana License: Who Decides"]

Postema expressed puzzlement that the licensing board was recommending that compliance with the MMMA be struck from the zoning ordinance. [The zoning ordinance issue was discussed by the council later in the meeting.]

With respect to the sensitivity of the information that his office was requesting, he contended that dispensary owners have been told specifically that they can disguise the information in “the way it’s talked about in the ordinance.” The ordinance provides for unique alphanumeric codes to be used in labeling as follows:

(4) All marijuana delivered to a registered qualifying patient shall be packaged and labeled as provided in this chapter. The label shall include:
(a) a unique alphanumeric identifier for the person to whom it is being delivered;
(b) a unique alphanumeric identifier for the registered primary caregiver who is delivering;
(c) a unique alphanumeric identifier for the medical marijuana cultivation source of the marijuana;

[In asking "... does [Dispensary Name] ever pay, donate, or in any way give money to the person or entity who delivers the marijuana or to anyone else? If so, to whom is the money paid, donated, or given and how much?” the city attorney is apparently seeking to establish whether a “sale” of marijuana is taking place at the dispensary. The McQueen case turned in part on the court’s view that the dispensary in that case was not providing assistance to patients in the medical use of marijuana beyond the provision of the raw material and was thus engaged merely in the sale of marijuana.]

Briere countered Postema’s contention that the names could be disguised by pointing out that the letters sent by Postema’s office asked, “… to whom is the money given?” She said that she understood that to mean, “… give me the name of the person …” And that’s how dispensary owners and the licensing board had understood it, she said. Briere recalled the lengthy council discussion about whether to collect the names of people who were involved.

She also said that given all the intricacies, the licensing board is not asking that other laws not be enforced, but that until the council decides what it will do with the ordinances, it asks the city attorney not to consider anything else. The members of the licensing board don’t want to talk about whether a license should be granted, if they believe that the council will be advised that no licenses should be granted. The board wants the council to consider amendments to the ordinances first. What she hears from the city attorney is that he can’t assert at this time that anybody complies with the ordinances. So why should licenses be considered, if the advice from the city attorney will be that nobody is in compliance? The licensing board was asking the council to deal with the ordinances, she said.

Stephen Kunselman (Ward 3) zeroed in on Postema’s question about why the licenses were not in front of the council. He noted that Briere had implied that if the licenses came before the council, the council would be advised that the dispensaries don’t comply with state law. He alluded to the public commentary about the narrow interpretation of the McQueen case.

So Kunselman asked Postema why the licenses are not in front of the council. Who would bring them, he asked? Would it be the city attorney, or the city administrator? That seems the most rational thing to do, he said, to start moving forward, rather than delaying enforcement. “Let’s get the license applications in front of us,” Kunselman said. Postema then contended, “I think they are in front of you in one sense. I don’t really know why, in the ordinary course of something like this, they would just come in front of you … it is before you, it just doesn’t show up on the agenda.” He indicated that his office would not ordinarily put such an item on the agenda, but that it would happen “automatically.”

Briere responded to Postema’s remarks by noting that the council had been provided with the licensing board’s report, which includes the dispensaries that have been recommended for licenses. She said that if it’s the council’s desire, she could bring the license recommendations to the council for a vote – she could do that as soon as the next meeting. But she noted that if the ordinances have not been resolved, then the council may not believe it has the ability to approve a license. It’s the council’s decision about the order in which things flow, she said. But the licensing board wants the ordinances dealt with first.

Mayor John Hieftje said that in following reports out of Lansing, it seemed to him that the state law is in “flux” – alluding to the supreme court’s decision to hear the appeal of the McQueen case and possible new legislation that’s being considered.

Postema told Hieftje that the state of the law is not in flux. The body of law in the court of appeals has been consistent, he said. Postema said it was not a surprise that the supreme court had agreed to hear the McQueen case. He said most people who are following the case don’t believe the ruling would change. However, he allowed that there could be a change in the analysis of McQueen. He indicated he’d shared his thoughts with people working on new state legislation. He said he was not going to pursue the issue right now. But he repeated his contention that “… right now they don’t have a license, they’re not in compliance with the ordinance.”

Hieftje noted how much time the council had spent on the issue over many months, and said he was reluctant to “do anything concrete” with the possibility that legislation might move in Lansing and court cases still being considered. He said he didn’t want to spend any more time on the issue than they needed to: “We’ve spent way too much time on this issue for what it should have warranted.” He laid that at the feet of the state legislature in Lansing, saying they’d totally dropped the ball on providing guidelines for local governments.

Sandi Smith (Ward 1) asked for confirmation from Postema that other cities have collected fees and issued licenses for dispensaries. Postema allowed that was true. Smith ask if there’d been any state action against the cities that had done that. Postema said he didn’t think there’d been state action.

Smith felt the council’s discussion had provided fodder for the licensing board to reconsider the methodology of trying to get the licenses to go forward. She suggested that the council send the message back that the council wants to look at the licenses – that was the approach she wanted to take. If the state does something, the council could make adjustments as needed.

Carsten Hohnke (Ward 5) expressed concern about the order of things. He indicated support for Smith’s desire to go ahead and have the council consider the licenses. He felt that if the council considered the licensing applications after changing the ordinances, the council might find itself wishing that it had maintained the same ordinance language. He felt that the point is to get some better understanding of how dispensaries are conforming. In the discussion of whether to approve licenses, the council might come up with an approach to dealing with that.

So Hohnke moved to table the resolution directing the city attorney. It did not feel like the right order of things, he said. Hieftje said his concern was that the council could consider the licenses and then find that six months later the rules have changed at the state level and the council would be back to considering the licenses again. “It doesn’t seem to end, is the problem here,” he said. Hieftje was somewhat reluctant to consider the licenses, given what he thinks the city attorney’s advice would be in the context of the state law. What he liked about the resolution is that it says basically, “Listen, there’s nothing really wrong right now, and we haven’t had any particular problems, let’s give ourselves some time …”

Hohnke said it would be nice to get direction from the legislature. But absent the consideration of a license, Hohnke said, the need for asking questions about whether there is compliance to support approval of the licenses would be moot. It’s not clear then what might happen that the resolution would address. So Hohnke moved to table the resolution and it was seconded by Smith.

Briere noted that it’s completely in the control of the council to postpone to a date certain or to table. She allowed that the need to bring this back off the table might not exist, if the council evaluates licenses. Things might not be resolved at the state level in three months. To delay this longer than three months seems wrong, she said. If the council wants to see licenses before June 18, it may never need to come off the table.

Christopher Taylor (Ward 3) said that as he understands the status quo, one suspects businesses are operating and people are obtaining medical marijuana under what they believe to be safe and comfortable conditions. He said he had a problem with the idea of ceasing the enforcement of existing laws, so he’d support the tabling.

Outcome: The council tabled the resolution on a 6-4 vote. Dissenting were Sabra Briere (Ward 1), Margie Teall (Ward 4), Mike Anglin (Ward 5) and mayor John Hieftje.

Given the sentiment expressed by Smith, Hohnke and Kunselman, there is at least some interest on the council in seeing the license recommendations come before the council. However, the city attorney has told at least one councilmember that his office would not be prepared to give advice on the issue at least until June.

Direction to Planning Commission

Another resolution on the April 2 council agenda would direct the city planning commission to review the medical marijuana zoning ordinance, including the licensing board’s recommended change. The one board-recommended change is to strike the following sentence: “Medical marijuana dispensaries and medical marijuana cultivation facilities shall be operated in compliance with the MMMA (Michigan Medical Marijuana Act).” [.pdf of the recommended zoning ordinance change. For analysis of the implication of striking the sentence, see "Ann Arbor Marijuana Licenses: Who Decides?"]

The discussion at the licensing board’s Jan. 18, 2012 meeting on this issue included concern expressed by dispensary owner Chuck Ream, who indicated that deleting the phrase could cause alarm and attract unwanted attention to Ann Arbor if it were incorrectly perceived as sending a message that Ann Arbor’s dispensaries would not be following Michigan’s medical marijuana law.

Tony Derezinski (Ward 2) led off deliberations on April 2 by saying that with the action the council had just taken – postponing the licensing ordinance revisions and tabling the direction to the city attorney – giving direction to the planning commission didn’t make sense. He said that action should be postponed.

Sabra Briere (Ward 1) pointed out that one reason for postponing the licensing ordinance revisions was to allow time for the planning commission to consider the medical marijuana zoning ordinance. There was no other reason to postpone it. So she did not encourage postponing the resolution.

Christopher Taylor (Ward 3) asked if there was any reason to think the planning commission would not take action on the licensing board’s request in due course. Briere said that if the council were to ask the planning commission to take a look at the recommended change, the commission would take some action.

Taylor followed up by saying that his understanding was that the ordinary course of things would have the planning commission considering the licensing board’s request [without involvement of the city council]. He asked if the licensing board had communicated its request to the planning commission. Briere indicated that it’s the council that would make the request, not the licensing board. Taylor questioned whether the planning commission really would not consider any zoning change unless it’s been specifically requested by the council. Briere replied that this was the order in which she’d been told she had to do things. Based on her conversations with the city attorney’s office, this was the order in which things needed to go.

Jane Lumm (Ward 2) asked if there were a legal reason why for the recommended change to delete the explicit mention of MMMA compliance. She felt it was not an unreasonable requirement to include in the zoning ordinance. She wondered if the suggestion was that dispensaries don’t need to be in compliance with the MMMA.

Briere explained that during the course of the application process, the licensing board members learned that in part because of that specific clause, that [in the city attorney's view] each license applicant had to prove they were in compliance. The rest of the zoning ordinance has requirements that mirror the requirements in the MMMA. But the specific clause prevented any of the dispensaries from obtaining a zoning compliance permit – because they couldn’t, to the satisfaction of the city staff, prove they were in compliance with the MMMA. Without a zoning compliance permit, no application was complete, Briere said.

Postema said he didn’t think it was unreasonable for the process to go to the planning commission and come back to the council.

Carsten Hohnke (Ward 5) said that the merits of the appropriate changes could be discussed later, but he felt that the proper order of things was to send it to the planning commission. Mayor John Hieftje felt it wouldn’t take the planning commission an inordinate amount of time to act.

Derezinski asked if the city council was asking the planning commission to delete the section that had been recommended for deletion by the licensing board. Postema clarified that the resolution was asking the planning commission to take a look at it – it would not require the planning commission to make any particular recommendation. Derezinski asked if this were a case of making a change to an ordinance through a resolution. No, said Postema. Derezinski confirmed with Postema that the planning commission could do whatever it felt was best.

Lumm found the deletion of the sentence confusing, from the perspective of a planning commissioner. Postema noted that any change would need to come back to the council. Briere observed that it’s within the purview of the planning commission to make any recommendation.

May 7 was specified in the resolution as the date by which the planning commission was supposed to act. Mike Anglin (Ward 5) asked if the May 7 date was appropriate. Planning manager Wendy Rampson noted that they’d need 15 days for noticing any public hearing on the issue. Also it might be hard to respond quickly without additional background. It would be helpful to have some additional time, say until the end of May, Rampson said. Hieftje proposed June 1, for which there was general agreement.

Outcome: The council approved the resolution giving direction to the planning commission to review the zoning ordinance over the sole dissent of Tony Derezinski (Ward 2).

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

Absent: Marcia Higgins.

Next council meeting: April 19, 2012 at 7 p.m. in the council chambers at 301 E. Huron. [confirm date]

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Most notably, the meeting featured remarks from city attorney Stephen Postema indicating that he believes medical marijuana dispensaries should not be in business now because they lack licenses: “… [dispensaries] can’t operate right now, they’re not allowed to operate at all – without a license.”

That contradicts the city’s ordinance, which allows dispensaries to operate while their license applications are still pending. (The city is still in the process of issuing its first licenses for dispensaries.) From the ordinance: “The medical marijuana dispensary may continue to operate pending final action on the application unless the Building Official determines that it must be closed for safety reasons.” When The Chronicle sent Postema an emailed query questioning the accuracy of his statement, he responded by insisting his statement was accurate. However, Postema declined to provide any foundation for his feeling that dispensaries lacking a license – even those with applications pending – are not allowed to operate by dint of having no license.

If dispensaries are assumed to be operating in violation of the Michigan Medical Marijuana Act, then they would not be allowed to operate – whether they had a license or not. However, at the April 2 meeting Postema did not identify a basis for such an assumption. He stopped short of describing an interpretation of a recent Michigan court of appeals ruling (the McQueen case) as banning all dispensaries, but said the ruling presented “severe difficulties” for dispensaries.

The council’s deliberations on Monday night can be understood in the context of a struggle between the city attorney’s office on the one hand, and some members of council and the medical marijuana licensing board. The struggle relates to who has the decision-making authority for awarding licenses, and when those licensing awards should be decided. From a formal, procedural point of view, it’s not an open question: The licensing board makes recommendations to the city council, which has the ultimate decision-making authority. The board has already recommended that licenses be awarded to 10 different dispensaries.

However, from a practical point of view, the council will act only under the advice of the city attorney’s office. Since the licensing and zoning ordinances were enacted by the city council last year, Postema has proceeded in a way that reserves a role for city staff in the licensing process that has an uncertain basis in the actual ordinances approved by the council. Revisions to those ordinances, meant in part to address some of those uncertainties, were part of the council’s April 2 agenda.

Here’s a summary of the outcome on medical marijuana issues at the April 2 meeting: (1) the council unanimously postponed consideration of licensing ordinance revisions until June 18 – the council’s second meeting that month; (2) on a 9-1 vote, the council approved giving direction to the city planning commission to review the zoning ordinance; and (3) on a 6-4 vote, the council tabled a resolution directing the city attorney to delay enforcement activities against dispensaries. A tabled resolution will demise if it’s not brought back off the table in six months.

Deliberations suggested in sum that the current arrangement in Ann Arbor, under which patients are still able to get medical marijuana from dispensaries, will persist at least until the city council votes on licenses. But the timing of that vote appears fairly uncertain, given the mixed signals currently being sent by the city attorney.

Provided in this article is analysis of some of the local issues related to medical marijuana licensing and zoning. The analysis culminates by showing how the interpretation of a single requirement in the city’s zoning ordinance – that dispensaries adhere to the Michigan Medical Marijuana Act – makes a significant difference in who makes the practical decision on whether dispensaries receive a license and can legally operate, and where the burden of proof lies for MMMA conformance.

Local Ordinances

The city council passed two pieces of legislation on medical marijuana at its June 20, 2011 meeting – a licensing ordinance and a zoning ordinance. The final approval of the legislation came after more than a year of legislative work, which began in closed sessions by the council held with its city attorney. The council’s first public discussion and action, however, did not come until the council’s Aug. 5, 2010 meeting, when the council imposed a moratorium on the “initiation or expansion” of medical marijuana business uses within the city. So the moratorium, which was extended several times from its initial 120-day period, did not apply to existing businesses.

Local Licensing: Pending Applications

Existing medical marijuana businesses with ongoing operations before Aug. 5, 2010 were recognized in Ann Arbor’s local licensing ordinance in at least two ways. [.pdf of Ann Arbor medical marijuana licensing ordinance] First, they were able to submit applications for a license before businesses that were not in operation before the moratorium. Second, the licensing ordinance explicitly provides for a dispensary’s continued operation while its application is pending [Emphasis added]:

7:504. Application requirements for new annual license or renewal of existing license; license requirements for new license and for renewed license.
(1) Application Submission.
A medical marijuana dispensary that commenced operation prior to passage of the moratorium by City Council on August 5, 2010, shall have until 60 days after the effective date of this chapter to submit an application for a new annual license. If the medical marijuana dispensary commenced operation prior to passage of the moratorium in a zoning district where its operation is not permitted under the zoning ordinance, the application shall be for a location in a zoning district where operation of a medical marijuana dispensary is permitted under the zoning ordinance. No other applications will be accepted by the City until 75 days after the effective date of this chapter. The medical marijuana dispensary may continue to operate pending final action on the application unless the Building Official determines that it must be closed for safety reasons. Within 60 days after an application is denied, the medical marijuana dispensary shall discontinue all operation.

Postema’s characterization of the situation at the April 2, 2012 council meeting is at odds with the content of the ordinance. His remarks came in the context of an argument he was making that the council should be thinking about voting on the license awards for the 10 dispensaries that had been recommended for licenses. Final action on their applications is still pending, because the city council has not yet voted on them. From Postema’s remarks to council [inaccurate statement emphasized with italics]:

… frankly I don’t know why, under the ordinance, the business licenses aren’t before the council. Ordinarily they’d come there. So again, this is all sort of backwards in one sense, because what they’re trying to do is get a license. They can’t operate right now, they’re not allowed to operate at all – without a license. And that is what they should be wanting to be in front of you, so you can rule on it. So if they do comply with state law, they can get a license. So asking them for basic information is part of what needs to be there. And that’s nothing surprising. The fact that the licensing board somehow took offense to this, that’s because they’re operating in a different realm in some ways than what I’m being asked to do. So there’s nothing surprising there.

An emailed query from The Chronicle to Postema pointing out the contradiction between the actual ordinance language and Postema’s inaccurate statement at the meeting was met with this reply: “There is no inaccuracy in the statement as a careful review of the entire zoning and licensing ordinances demonstrate.”

Unanswered by Postema was a follow-up invitation to explain how he reasoned that a dispensary with a pending license application is illegal (by dint of lacking a license), in light of the specific language of the ordinance.

Beyond the part of Postema’s statement that is contradicted by the licensing ordinance, his remarks raise some interesting issues, most notably whether a detailed demonstration of a dispensary’s compliance with the Michigan Medical Marijuana Act (MMMA) could be a pre-requisite to receiving a license under Ann Arbor’s local ordinance.

Local Licensing: Role of State Law (MMMA)

The city’s licensing ordinance includes two provisions that allow the city to revoke a license, after has been granted, if a state law is violated:

7:508. License revocation.
…
(4) Marijuana is dispensed on the business premises in violation of this chapter or any other applicable state or local law, rule or regulation;
(5) The medical marijuana dispensary is operated or is operating in violation of the specifications of the license application, any conditions of approval by the City or any other applicable state or local law, rule or regulation.
…

The licensing ordinance also includes violations of state law under its prohibited acts:

7:507. Prohibited acts.
…
(b) Produce, distribute or possess more marijuana than allowed by any applicable state or local law.
(c) Produce, distribute or possess marijuana in violation of this chapter or any other applicable state or local law.
…

And the licensing ordinance requires that the conduct of business at a dispensary conform to a specific quantity requirement of the MMMA:

7:506. Conduct of business at a medical marijuana dispensary.
…
(3) No more marijuana than is permitted under the MMMA shall be kept on the premises of a medical marijuana dispensary.
…

However, the licensing ordinance does not establish as a pre-condition for licensing a demonstration that a dispensary has a business model that conforms with the MMMA.

The licensing ordinance does, however, establish a requirement that a license application include a zoning compliance permit:

7:504. Application requirements for new annual license or renewal of existing license; license requirements for new license and for renewed license.
…
(2) Application requirement for new licensee
…
(h) A zoning compliance permit that shows the proposed medical marijuana dispensary is located in a zoning district that would permit its operation.

Based just on Chapter 95, which contains the medical marijuana licensing code, it appears that a “zoning compliance permit” is simply a certification that a dispensary is in the correct zoning district. Otherwise put, as described in Chapter 95, a zoning compliance permit is simply a formal mechanism for ensuring that an applicant for a medical marijuana license intends to operate in a district that has been explicitly zoned for medical marijuana dispensaries.

By way of background, in Ann Arbor, medical marijuana dispensaries can be located only in those districts zoned as D (downtown), C (commercial), or M (industrial), or in PUD (planned unit development) districts where a retail use is permitted in the supplemental regulations.

Local Licensing: Chapter 95 Zoning Compliance Permit

But a zoning compliance permit is a notion that’s not unique to Chapter 95. The fact that there are other uses for a “zoning compliance permit” within the city bureaucracy – besides certifying that a business is in a district zoned for medical marijuana dispensaries – is made explicit in Chapter 95. In describing how the fee for a zoning compliance permit is assessed, Chapter 95 states [emphasis added]:

Fees for zoning compliance permits and certificates of occupancy shall be separate from the application fee, but shall be the same amount and shall be paid pursuant to the same procedures as applied to applications for zoning compliance permits and certificates of occupancy for other uses.

So Chapter 95 acknowledges that a zoning compliance permit as described in Chapter 95 serves a different purpose from zoning compliance permits mentioned elsewhere in the code. The purpose of a Chapter 95 zoning compliance permit, then, is none other than to establish that the dispensary is located in the correct zone. Nothing in Chapter 95 connects the granting of a zoning compliance permit to any type of compliance with the MMMA.

Local Zoning: Chapter 55 Zoning Compliance Permit

In evaluating license applications, however, the city attorney’s office and planning staff have applied an additional condition on granting zoning compliance permits – beyond a requirement that a dispensary is correctly zoned. That additional condition is for a dispensary to demonstrate compliance with the MMMA, which the city attorney’s office ascribes to the Chapter 55 zoning.

Local Zoning: Chapter 55 ZCP Conditions

The basis that staff is using for this additional requirement is not in Chapter 95, the medical marijuana licensing ordinance, but rather in Chapter 55, the general city ordinance on zoning. Chapter 55 includes the zoning regulations for medical marijuana dispensaries. [.pdf of medical marijuana zoning ordinance]

The Chapter 55 zoning compliance permit for medical marijuana dispensaries is described as follows:

(4) Medical Marijuana Dispensary and Medical Marijuana Cultivation Facility Regulations
…
(h) A zoning compliance permit shall be required consistent with Section 5:92

What is Section 5:92 of Chapter 55? It includes the following:

5:92. Zoning compliance permit required.
(1) It shall be unlawful to begin the excavation for the construction, the moving, alteration, or repair, except ordinary repairs as defined in Chapter 98 of the Ann Arbor City Code, of any building or other structure, including an accessory structure, costing more than $100.00 or exceeding 100 square feet in area until the Planning and Development Services Manager has issued for such work a Zoning Compliance Permit which includes a certification of his determination that plans, specifications, and the intended use for such structure do, in all respects, conform to the provisions of this Chapter.

Hypothetically, a dispensary that did not need to undertake any construction or alteration of a premises costing more than $100 or exceeding 100 square feet could meet the (4)(h) requirement without having a zoning compliance permit. That is, even though it did not have a Chapter 55 permit, it would still be consistent with 5:92. Such a hypothetical dispensary could then reasonably expect to be issued a Chapter 95 zoning compliance permit, if it simply demonstrates it is located in the correct zone.

So what is the basis of the city attorney’s contention that it’s his obligation to verify compliance with the MMMA? Consider a dispensary that undertakes enough work on the premises to trigger the 5:92 requirement that it obtain a Chapter 55 zoning compliance permit. In that case, the planning manager would need to determine that the “intended use” – as a medical marijuana dispensary – conforms to all the provisions of Chapter 55.

And one provision of Chapter 55 is this:

(4) Medical Marijuana Dispensary and Medical Marijuana Cultivation Facility Regulations
…
(k) Medical marijuana dispensaries and medical marijuana cultivation facilities shall be operated in compliance with the MMMA.

Local Zoning: State Law in Chapter 55 ZCP Conditions

Some licensing board members had this understanding of the city’s ordinance: If a dispensary owner states that the dispensary will or does conform with the MMMA, then the city planning manager could determine that the intended use as a medical marijuana facility conforms with (4)(k). Some board members felt that such an assurance would meet the conditions of a Chapter 55 zoning compliance permit.

It’s also possible to analyze the licensing requirements in a way that would result in the granting of a license, based on a Chapter 95 zoning compliance permit, but that could be followed by an immediate revocation of the license if the dispensary tried to operate, for failure to have a Chapter 55 zoning compliance permit.

The city attorney’s office sees the issue differently from the licensing board. The city attorney has interpreted the (4)(k) requirement to mean that a dispensary must demonstrate MMMA compliance to the city attorney’s office before it will be issued a zoning compliance permit. So the zoning compliance permits of the dispensaries that have been recommended for licenses are still pending. To evaluate compliance with the MMMA, the city attorney’s office required that dispensaries submit with their license applications a clear statement of exactly how their business models would conform with the MMMA.

For example, Cannabis Counsel, the attorney for MedMarx at Arborside, included a statement explaining its MMMA conformance in the wake of Michigan v. McQueen (Compassionate Apothecary). An Aug. 23, 2011 court of appeals ruling on the case has been interpreted by many authorities to mean that no medical marijuana dispensaries are legal. [.pdf of letter from Cannabis Counsel regarding Arborside's business model] The McQueen case has been accepted for review by the Michigan Supreme Court, which means that it’s not yet settled case law. And the broadest interpretation of the McQueen case – that it bans all dispensaries – is itself controversial.

The Cannabis Counsel letter lays out why the court of appeals in the McQueen case found that the Compassionate Apothecary business model was not in compliance with the MMMA: The problem was that Compassionate Apothecary did nothing to “assist” patients in administering or using marijuana, beyond exchanging marijuana for money. In contrast to Compassionate Apothecary, argues Cannabis Counsel, Arborside does assist patients in the manner described by the court – by assisting the patient “in preparing the marihuana to be consumed in any of the various ways that marihuana is commonly consumed.” Those ways include providing patients with “cleaned prepared de-stemmed cannabis including pre-rolled joints, medibles which have been inspected, tested, cleaned, grinded and rolled, or cooked in combination with foodstuff.”

The Ann Arbor dispensaries met the city’s request to submit with their applications an explanation of their compliance with the MMMA. And on Jan. 31, 2012, the city’s licensing board voted to recommend licenses to 10 dispensaries. Yet after that, when dispensary owners felt like they’d completed the application process with the final step to be a vote by the city council, the city attorney’s office sent out letters demanding additional data.

Among the questions posed to all dispensaries in the letters are the following: “Does any person or entity deliver marijuana to [Dispensary Name]? If so, does [Dispensary Name] ever pay, donate, or in any way give money to the person or entity who delivers the marijuana or to anyone else? If so, to whom is the money paid, donated, or given and how much?” [.pdf of set of letters]

Dispensaries have balked at the additional data request – the information is sensitive and the collection of such data by the city was explicitly removed by the city council during the legislative process that resulted in approval of the licensing and zoning ordinances. But the city is currently not granting Chapter 55 zoning compliance permits to license applicants – on the grounds that compliance with the MMAA cannot yet be verified.

Significance of (4)(k)

The interpretation of the seemingly innocuous requirement in (4)(k) of the zoning ordinance – that a dispensary operate in compliance with the MMMA – has a significant impact on two things: (1) Who makes the practical decision on dispensary license awards? and (2) Who bears the burden of proof with respect to the MMMA?

Significance of (4)(k): Applicability of the MMMA?

Absent the (4)(k) requirement, the city would need some other basis to deny a Chapter 55 zoning compliance permit to a dispensary. And that is one reason that the licensing board has recommended that (4)(k) be struck from the ordinance. At the council’s April 2 meeting, the idea of striking the (4)(k) was met with professed puzzlement by some councilmembers as well as the city attorney. Their rhetorical position trades on the idea that striking the provision would somehow mean that dispensaries do not have to operate in accordance with the MMMA. In fact, of course, removing the requirement would have no effect on the applicability of the MMMA. It’s not possible to render a state law inapplicable by failing to mention it in a local ordinance.

Significance of (4)(k): Decision Point

But it’s not entirely true – as city attorney Stephen Postema claimed at the April 2 meeting – that “… the [proposed] changes in the zoning or the other ordinance aren’t going to change the issue of whether they are compliant with state law.”

Under Postema’s understanding of the (4)(k) requirement, there’s a decision point before a city council vote on license awards. That decision point is effectively made by the city attorney – about granting a Chapter 55 zoning compliance permit. The decision has a material effect on a dispensary’s ability to operate. If a Chapter 55 zoning compliance permit is denied, or still pending, then it’s not clear why a councilmember would vote yes on the award of such a license.

From a practical point of view, operating without a zoning compliance permit would be a violation of the zoning ordinance (even if the zoning compliance permit were still pending), and that would be grounds for revocation of the license, even if one were awarded. So even if a license were awarded by the council, it would not give the dispensary the ability to operate in the absence of a Chapter 55 zoning compliance permit. On that scenario, a dispensary would have a meaningless license and could not operate until the city attorney decided to issue a zoning compliance permit.

Postema’s office has still not made decisions on the issuance of Chapter 55 zoning compliance permits for the dispensaries that have been recommended for licenses by the licensing board. The permits are still pending. So it’s not clear why Postema would say at the council’s April 2 meeting: “… frankly I don’t know why, under the ordinance, the business licenses aren’t before the council. Ordinarily they’d come there.” It’s especially not clear why Postema would say that, when he has told at least one city councilmember that his office would not be prepared for licenses to come before the council until June.

Postema’s feeling – that a zoning compliance permit can be issued only if he is satisfied that the dispensary is MMMA compliant – has a consequence for the practical decision point on awarding licenses. In order for the council to take a vote on awarding licenses with any practical consequence, a dispensary will need to have a zoning compliance permit. And if a dispensary has a zoning compliance permit, that means the city attorney has been satisfied that a dispensary is MMMA compliant.

So for any meaningful council vote on a dispensary license award, Postema will have publicly indicated that the dispensary is MMMA compliant – through granting a zoning compliance permit. If Postema were to present the opposite view confidentially to the city council in advising against the award of a license, that would be inconsistent with his public decision to grant a zoning compliance permit. So from a practical point of view, Postema’s interpretation of the criteria for granting a zoning compliance permit – the (4)(k) provision – moves the decision-making step on licenses from the city council to his office.

In contrast, on the licensing board’s interpretation of the (4)(k) requirement, dispensaries would simply need to do what they’ve already done – provide an assurance that their intent is to comply with the MMMA and a rationale for why their business model is MMMA compliant. On that interpretation, a dispensary would qualify for a zoning compliance permit if it’s located in the correct zone.

At that point, a license award could be voted up or down by the city council, with the city attorney free to provide the council whatever legal advice he felt was appropriate. For example, Postema’s advice could run along the following lines: Even while the dispensary owner has given an assurance of intent to operate in compliance with the MMMA, thus earning a zoning compliance permit, the opinion of the city attorney is that this dispensary will not or does not achieve actual compliance with the MMMA, based on a stated set of reasons.

Significance of (4)(k): Burden of Proof

The licensing board’s interpretation of (4)(k) would also have a practical effect on the issue of state law compliance – with respect to who has the burden of proof. The city attorney’s office contends that under the current zoning and licensing legislation, a dispensary has the burden of proof to demonstrate to the city attorney that it’s in compliance with the MMMA before it can be issued a zoning compliance permit. In any case, the zoning compliance permit is required under the zoning ordinance in order for a dispensary to operate – whether it has a license or not.

On the licensing board’s interpretation of (4)(k) – or if (4)(k) were deleted, as the board recommends – dispensaries would be issued zoning compliance permits. That issuance would be based on their appropriately-zoned location and their intention and rationale for compliance with the MMMA.  The city council could then weigh the city attorney’s advice in making its decision on a license award. And it’s possible that the city attorney’s advice would be that a particular dispensary already did not conform to the MMMA, or did not have a business model that would conform.

But suppose the council made a decision to award a license, against the city attorney’s advice. Then, if Postema believed the dispensary were operating in violation of the MMMA, the burden of proof would be on him to demonstrate that’s the case, in the context of starting a license revocation process.

Conclusion

The interpretation of the (4)(k) requirement thus has a significant impact on: (1) who makes the practical decision on license awards and the ability of dispensaries to operate; and (2) who has the burden of proof for determining MMMA compliance. On the city attorney’s interpretation, a practical decision on license awards can be made by his office, and the burden of proof for compliance rests with the dispensaries. On the licensing board’s interpretation, the practical decision about a license award is made by the city council, and the burden of proof on MMMA compliance rests with the city attorney.

So by suggesting that (4)(k) be struck from the zoning ordinance, the licensing board is not suggesting that dispensaries be allowed to operate in violation of the MMMA. Rather, the licensing board is suggesting that the question of interpreting (4)(k) – and its impact on the granting of zoning compliance permits and license awards – be removed from the discussion. With no (4)(k) left to interpret, the practical decisions on license awards would be made by the city council, and the burden of proof for violation of the MMMA would rest with the city attorney.

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The council unanimously postponed consideration of the licensing ordinance revisions until the council’s second meeting in June – June 18.

The council approved the  resolution that gives direction to the planning commission to review the medical marijuana zoning ordinance, on a 9-1 vote.

The council tabled the resolution directing the city attorney to delay enforcement activities until the revisions to the local ordinances have been either adopted or rejected. The tabling was achieved on a 6-4 vote. Voting against the tabling were mayor John Hieftje, Sabra Briere (Ward 1), Margie Teall (Ward 4) and Mike Anglin (Ward 5). A tabled resolution will demise if it’s not brought back off the table in six months.

The board-recommended revisions to the medical marijuana licensing ordinance are laid out in detail in The Chronicle’s coverage of the medical marijuana licensing board’s Jan. 31, 2012 meeting. [.pdf of recommended licensing ordinance revisions] Representative of the revisions is a change that strikes the role of city staff in evaluating the completeness of a license application. The following phrase, for example, would be struck: “Following official confirmation by staff that the applicant has submitted a complete application …” The changes also establish a cap of 20 licenses, and grant the city council the ability to waive certain requirements. The power to grant a waiver to provisions in an ordinance through a simple resolution did not meet with a positive reception from several councilmembers, most notably Tony Derezinski (Ward 2).

The zoning ordinance revision recommended by the medical marijuana licensing board was not itself considered by the city council on April 2. Instead, the council considered a resolution directing the city planning commission to review the medical marijuana zoning ordinance, including the licensing board’s recommended change. The one board-recommended change is to strike the following sentence: “Medical marijuana dispensaries and medical marijuana cultivation facilities shall be operated in compliance with the MMMA (Michigan Medical Marijuana Act).” [.pdf of the recommended zoning ordinance change] Derezinski was the sole vote against giving the planning commission direction. He’s the council’s representative to the planning commission.

The tabled resolution to direct the city attorney to delay enforcement activity against dispensaries would have directed the city attorney to “… delay all enforcement activities against medical marijuana dispensaries and cultivation facilities except for claims that they violate Section 5:50.1(3) of the City Code [zoning regulations], until the Council amends or rejects amendments to the zoning and licensing ordinances for medical marijuana.”

The resolution stemmed from recent action taken by the city attorney’s office, demanding that dispensaries submit additional details of their business operation, contending that such details were required in order to evaluate a dispensary’s  compliance with the MMMA. Dispensaries recommended for licenses by the board had already been required to submit a written explanation of their conformance with the MMMA. So the additional demand for information was not well-received by dispensary owners.

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

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. Meeting Report: [link] Analysis of meeting issues: [link]

Left to right: Councilmembers Sandi Smith (Ward 1), Sabra Briere (Ward 1), Tony Derezinski (Ward 2) and Jane Lumm (Ward 2). (Photos by the writer.)

The issue driving the lengthy meeting was an agreement between four different entities, including the city of Ann Arbor, that would set up a framework for a transition of the Ann Arbor Transportation Authority to a new funding and governance structure. The intent of transitioning to a new authority would be to provide increased transportation service both within the city of Ann Arbor as well as throughout Washtenaw County.

The Ann Arbor city council approved the agreement on Monday night on a 7-4 vote, after postponing it three times previously. That sets the stage for the city of Ypsilanti, Washtenaw County and the AATA to approve it as well. Even after approval by those three entities, several steps would remain before a new transit authority, incorporated under Michigan’s Act 196, could take over transportation services from the AATA.

The council considered several amendments to the agreement, but approved only two relatively minor, clarificational items. [.pdf of agreement as amended]

Toward the end of the meeting, the nomination of University of Michigan planner Sue Gott to the AATA board was given spirited discussion by two councilmembers, but was ultimately confirmed on a unanimous vote.

Falling victim to the lengthy deliberations on the transit agreement was a resolution that would direct the city attorney to delay enforcement of medical marijuana laws for local dispensaries, except for zoning violations. A vote on that resolution was postponed without deliberation, due to the late hour. That resolution comes in the context of a recommendation from the city council’s medical marijuana licensing board, currently pending with the council, to award the first 10 medical marijuana licenses under local legislation enacted last year.

Related to a different kind of licensing, the council approved a resolution that recommends non-renewal of liquor licenses for two establishments in Ann Arbor – Dream Nite Club and Rush Street. A hearing on the two licenses will be held on March 19, with the city council’s final recommendation to the Michigan Liquor Control Commission to be made that same day.

The council also passed several resolutions related to land and its use. The council approved the acquisition of another 58.85 acres under its greenbelt program, as well as the purchase of property on West Kingsley so that a long-vacant house there can finally be demolished. A rain garden is to be constructed on that parcel, because it’s situated in the Allen Creek floodway. In a related item, a new Federal Emergency Management Agency (FEMA) flood map was also given final approval by the council on Monday night.

The council gave initial approval to a revision of parking regulations in open space at the front of land parcels, but postponed any action on a proposed revision that would eliminate a requirement on landscape buffers in areas zoned R4C (multi-family residential).

Receiving approval from the council were a total of nearly $1.7 million in renovations to several of the city parks. The funding includes improvements to ballfields at Veterans Memorial Park, Southeast Area Park and West Park, as well as upgrades to roads and paths at Buhr Park and Cobblestone Farm.

The council also approved the issuance of $120 million in revenue bonds for the reconstruction of the city’s sewage treatment facilities, long planned and in the works.

Four-Party Transit Agreement

For the fourth time, after three postponements dating to the first meeting of 2012, the council considered a four-party transit agreement – with the city of Ypsilanti, Washtenaw County and the Ann Arbor Transportation Authority. The agreement would provide a framework and chronological sequence for the transition of the AATA to a new governance and funding structure. The Ann Arbor approval leaves several steps that would still need to be completed, before such a transition would be possible. [.pdf of four-party agreement as amended on March 5, 2012]

By way of more detailed background, the council had previously postponed voting on the four-party agreement at its Jan. 9 and Jan. 23 meetings. Thirty-nine people spoke at a public hearing held on Jan. 23.

The council postponed the agreement again at its Feb. 6 meeting. But for that meeting, the AATA itself had requested a postponement until March 5.

The council agreed at its Feb. 6 meeting to postpone the vote until March 5 – but with the proviso that postponement to that date certain would be “contingent upon materials being submitted to City Council by Feb. 29, 2012.”

During the Feb. 6 deliberations on postponement, councilmembers were content to give the mayor and city administrator the discretion to hold the item off the agenda, if the desired information was not submitted to the council by Feb. 29. That proviso nearly led to the omission of the item from the March 5 agenda, but in the end, it was presented to the council for its consideration.

Transit Agreement: Public Comment

The four-party transit agreement prompted several people to speak during public commentary.

Thomas Partridge introduced himself as a city resident and former candidate for state senator in the 18th district. He has been and will continue to be a candidate for public office, he said. His platforms call for countywide and region-wide affordable accessible transportation, education and housing. He highlighted the coincidental goal of economic development that would be supported through improved transportation.

Elizabeth Donoghue Colvin introduced herself as a Ward 1 resident of Maiden Lane. She stressed that what she wanted to say were her views, but she knew that many people shared them. Regarding the Fuller Road Station, she understood that the University of Michigan was no longer planning to participate in the project by building a parking structure there. But she said she still favored building a transit center there. It’s near the place where a large number of employees work, and it’s not in a neighborhood, she said. The Fuller Road location has space to accommodate traffic flow. She said she hoped the parkland issue can be resolved in a positive way, perhaps with a trade-off. She felt the highest value is to put a transit center there, in the context of broadening a county transportation system.

That related to a second issue Colvin wanted to address, namely the four-party transit agreement, and she supported broadening transit in that fashion. She sees that as part of a larger plan to broaden transit regionally with neighboring counties. She said she appreciated the funding challenges, but encouraged the council to move the agreement forward. If there were an additional transit millage put on the ballot, she concluded, she would vote for it. “I would like to pay for broadened transportation in this county,” she said.

Carolyn Grawi introduced herself as the director of advocacy and education at the Ann Arbor Center for Independent Living (CIL). Looking at the four-party transit agreement, in light of a recent survey the AATA has done, and in light of recommendations from a financial advisory group, Grawi said she wanted to highlight one point: Of those who were surveyed, 86% talked about the importance of providing those with disabilities and seniors with door-to-door service. Right now that kind of service is provided up to a certain geographic point, but then it stops. If 86% of people want that service, Ann Arbor needs to look at how it fits as the puzzle piece in the center of the county.

Looking at transportation services, Grawi said, she was hopeful that the community would continue to fund local services. The disability community relies on the city council for leadership to ensure that local service continues to be provided.

Christine Green spoke on behalf of the Michigan League of Conservation Voters. She told the council she was there to comment favorably on the four-party agreement. MLCV has worked for many years to support similar initiatives in Michigan. In 2011, MLCV helped pass the Grand Rapids transit millage and that has in turn helped bring state, federal and private revenue to that community. Green then ticked through some reasons why MLCV has used its resources to support public transportation.

Public transportation improves public health, Green said, through reducing particulate pollution, encouraging more active forms of transportation, and reducing runoff from surface pollutants. She also said that public transportation helps create jobs and helps local business. Green pointed to better land use as a result of public transportation, saying that it helps prevent urban and suburban sprawl and protects open spaces. Public transportation, she said, also helps revitalize cities.

Lawrence Baird introduced himself as a Ward 1 resident – a financial advisor for 22 years in Ann Arbor. In his professional capacity he spent a lot of time dealing with budget numbers. He said Ann Arbor has been blessed with a level of financial stability beyond what most Michigan cities have enjoyed.

To illustrate his point, he said, he’d brought along his tax bills from last year. The city’s core values are reflected in the tax bills, he said. What appears on the tax bills is the fact that Ann Arbor is funding education, library, recycling, parks, street maintenance and also transit. So the current debate is not about core values – very few residents are against mass transit, he ventured. Most residents have no problem paying hundreds of dollars a year to fund transit.

Baird had accepted the fact that he pays more to fund transit than many other services – like the library, parks maintenance, and street repair. He said that renters in the city should also receive a copy of the categories on the tax bills so they’d understand how property taxes are used.

The city council is being asked to approve the four-party agreement, which Baird described as the continuation of a process to dissolve a decades-old transportation system. [Baird then alluded to a political tactic that Stephen Kunselman (Ward 3) has used, in which he calls the four-party agreement the "mayor's plan." Mayor John Hieftje has responded consistently with the assertion that he can't take credit for the plan.] Noting that Hieftje has maintained he can’t take credit for the plan, Baird observed that Hieftje had nominated the AATA board members, whom the council then confirmed. Back in 2008 those board members accepted the lead role in the development of the WALLY north-south commuter rail project. [The vote came at a special meeting called by the AATA board.]

Baird then read from a document on the AATA’s website, dating from July 24, 2009:

AATA is funded through a combination of federal, state and local revenues, as well as passenger fares. State funding has remained at the same level since 1997. As a result, AATA has implemented extensive measures to reduce costs. Looking ahead, expected decreases in local property tax revenues threaten our ability to meet current and future ridership demands. AATA is projecting significant reductions in revenue in future years due to a decrease in local property values and continued pressures on state operating assistance.

Baird concluded that while property taxes and state assistance are in flux, the AATA had taken on a commuter rail project from scratch. The AATA had also adopted a vision statement [at its Nov. 18, 2009 meeting] that says:

AATA Vision Statement: The Ann Arbor Transportation Authority shall be the public transportation provider for Washtenaw County. Our customers shall see AATA’s expanded services as the preferred option for traveling to destinations within the county, as well as to and from the county. AATA will offer appropriate modes of transportation with the most efficient use of resources. These services shall enhance the quality of life for Washtenaw County stakeholders while promoting the economy, safeguarding the environment, and strengthening communities.

So during the depths of one of the worst financial crises the country has known, Baird concluded, the AATA had decided to get into the railroad business and to expand its original mandate.

Paul Schreiber introduced himself as the mayor of Ypsilanti. He said councilmembers had likely seen the AATA’s financial task force report. The group had reduced a roughly $60 million funding gap to around $30 million by eliminating rail transportation and concentrating on those services that could be supported with local funding. He said the financial advisory group had done some great work and he encouraged the council to approve the four-party agreement.

Schreiber noted that the agreement includes the authorized 2.5 mill tax currently levied by Ann Arbor and almost a 1 mill tax from Ypsilanti. But he noted that Ypsilanti’s service is contingent on a purchase-of-service agreement (POSA). A countywide transit authority would be a more stable source of funding, he said. He noted that Ypsilanti voters had approved their transit millage in August 2010, and passed it on a 2:1 margin. Due to a technicality, it had to be put on the ballot again in November, when it passed on a 3:1 margin. So Ypsilanti voters support transit, he said.

Transit Agreement: AATA Comment

Michael Ford, CEO of the Ann Arbor Transportation Authority, was asked by mayor John Hieftje to make some remarks, along with some members of the financial advisory group, about the recommendations of that group. It’s been referred to for some time now as a “task force.”

Members of the AATA financial advisory group, from left: Bob Guenzel, Norman Herbert, and Mark Perry.

Ford told the council he was there to ask for the council’s approval of the four-party agreement. He told them that since the last council meeting, councilmembers had been provided with the recommendations from the financial task force, information on survey results and legislative information.

[For an overview of the survey results, see Chronicle coverage: "AATA OKs AirRide; Survey Results Positive." For an overview of pending state legislation, see Chronicle coverage: "Michigan Regional Transit Bills Unveiled."]

Bob Guenzel, former Washtenaw County administrator, co-chaired the financial task force with Albert Berriz, CEO of McKinley Inc. Guenzel attended the council’s meeting, along with two other members of the group – Norman Herbert, retired treasurer of the University of Michigan; and Mark Perry, director of real estate services for Masco Corp. Ford stressed that of all the issues, he wanted to focus on the four-party agreement.

Guenzel told the council that he’d try to be brief, but felt that the financial task force should report to the council. He said he was honored to be part of the task force. It was Berriz who represented the private sector on the task force and had helped bring the business community to the table. The task force was made up of business leaders as well as government leaders, Guenzel said, and others who had an interest in transportation. He noted that the task force had agreed to have only four meetings, and they’d had three – but a subcommittee was formed that had additional meetings.

The task was to review the funding options for the transit master plan and see if they could develop some recommendations. Perry and Herbert were on the subcommittee that had done a service review and had dug into the finances, Guenzel said. The group looked at whether the services should be funded with local money or other sources. A funding gap – between existing revenues and what it would take to pay for expanded service was planned in the first five years of the new transit entity – had been reduced from $62 million, roughly in half to $33 million, he said.

That reduction had been achieved in several ways: (1) cost reductions; (2) enhanced revenues, through increased fares or increased state and federal revenue; and (3) change services. As an example of the third strategy, Guenzel cited an Ann Arbor downtown circulator – while it’s a worthwhile service, the task force was recommending that it be funded privately or through other agencies. Development of regional rail transportation had also been removed from the first five-year plan, Guenzel said.

To try to get a handle on how much funding is needed, if the property tax method of funding were used, it would translate to about 0.5 a mill. That’s not a recommendation, but rather an attempt to give some context to what it might mean for this community, Guenzel said. It still needs some refinement, for example, in terms of fare issues, and state and federal funds. The recommendations of the subcommittee were supported by the whole group as a guide for further development. The group recommends that a final funding recommendation be reserved until the concerns raised by the subcommittee have been addressed. The recommendation is that the task force be put on hold. There may be the need to convene more meetings going forward. As the service plan is developed, Guenzel said, that obviously has some effect on the financing.

Guenzel then read a portion of a letter from Albert Berriz, whom Guenzel described as representing the business community. Guenzel noted that his own career had been in the public sector. From the portion read by Guenzel:

My service on this committee and my work with the senior leadership team at the AATA over the past year has been very rewarding, and I have learned very much. I have scrutinized the people, the process and the numbers like I would in my own business; and I am very comfortable with Michael Ford and his team at the AATA.

No matter how much criticism and commentary this process may receive, I can speak as a CEO of a multi-billion dollar business and say that their results and the work product are solid and real. We should be very comfortable as a community that we have the right people in the right seats running the AATA. The practical reality of regional transportation is that it is a highly subsidized business. In the words of a for-profit guy, you can’t make the numbers work. So what remains is how you decide to raise those public dollars, and is it politically expedient to do so in the current environment that you find yourself in.

Guenzel noted that one way to raise the funds is through a millage, and the other is to look at what is currently being proposed in Lansing. [Some of the state legislation deals with establishing a regional transit authority for the counties of Washtenaw, Wayne, Macomb and Oakland. But another separate bill provides for the possibility of local transit funding through a voter-approved vehicle registration fee.] Guenzel said he agreed with Berriz that it’s premature right now to pursue a millage option until the legislative picture is clearer. But he is pleased that the task force is willing to be on call. He said the task force is ready to continue the study ultimately to make a recommendation. The task force feels, he said, that the rest of the process should proceed.

Norman Herbert then addressed the council. He noted that along with Mark Perry, he’d worked on the subcommittee charged with reviewing transportation services proposed under the AATA’s countywide master transportation plan. He told the council they’d already heard about the benefits of public transportation – access to health care, job opportunities, reduction in traffic congestion and better land use.

The primary conclusion of the task force, Herbert told the council, is that more information is needed before drawing any conclusions about the finances. The subcommittee recommended that certain services only be developed if federal, state or private funding could be identified for those specific services. The result is a focus on local and county service improvements, he said, that also reduced the funding gap from $62 million down to around $33 million. What’s needed now, he said is agreement on what the plan should be. The finance plan should not drive the service plan, he said. What’s needed is a definition of the project. The interested parties of the county need to join Ann Arbor and Ypsilanti to determine the specific elements of that plan.

Ann Arbor, Herbert said, needs to take a leadership role by entering into non-binding discussions. The 0.5 mill property tax is just a proxy to identify the magnitude of what it would cost a county taxpayer – if transportation improvements were made that focus on local and county needs, and if the cost were shared by all the various communities. It’s time to move forward with the planning, and the city council should agree to initiate those discussions with the AATA and the other interested parties, he said. Transit is a key amenity, and it helps everybody, but it helps Ann Arbor the most, Herbert concluded.

Mark Perry, a member of the AATA financial advisory group, with Ann Arbor city councilmember Marcia Higgins (Ward 4).

Mark Perry told the council a bit about how the 0.5 mill was calculated. They’d built an economic forecasting model that included traditional revenue forms. On the revenue side, they’d created a line item for state revenue sources that aren’t identified yet. There’s typically four or five revenue sources in the state of Michigan, he explained: sales and use tax; personal income tax; business income tax; property taxes; and fees. Only the last two can be levied at the local level, Perry noted. The 0.5 mill was based only on what is currently known. He said that the forecasting model the group had used included line items for the other revenue sources, but filled them with zeros.

Perry told the council that the Ann Arbor/Ypsilanti Regional Chamber of Commerce was represented on the task force, but could not attend the council’s meeting, so he’d agreed to read something aloud on their behalf. [.pdf of Ann Arbor/Ypsilanti Regional Chamber letter] An excerpt from the letter:

Our County needs a transit system that is affordable, accessible and practical. Such a system may include fixed-route and other bus and van options, and in the longer term, rail and other modes of transit. Ultimately, this system should connect not just those within Washtenaw County, but it should also enable us to connect throughout the greater southeast Michigan region. The benefits to be derived from such a system are many, including environmental, economic and humanitarian. The process provided through four party agreements allows us to pursue this objective. Should it not be approved, then the process will flounder.

The agreement is not a commitment to a plan or a millage, and it does not set fares. It is merely a process to explore these and other issues further. We have nothing to lose or risk by taking this step, but we have much to lose if this step is not taken. We therefore urge Council to approve the agreement and, as a Chamber, look forward to being actively involved in the planning towards fulfilling these objectives.

[.pdf of budget summary][.pdf of capital budget] [.pdf of operating budget] [.pdf of financial performance data] [.pdf of financial group's final report] [.pdf of financial group's subcommittee report]

Transit Agreement: Council Questions – Finance, Legislation

Sandi Smith (Ward 1) asked Mark Perry if the taxable value used for the property tax calculation was for the entire county. Yes, said Perry, because it’s not clear yet which political subdivisions would be participating – that’ll be determined at a later date. There’s also debate by the state legislature on exemption of tangible personal property. He indicated that if personal property tax were to disappear, as a whole countywide it would not be a large enough number to change the projected transit millage amount.

Smith asked if scenarios had been modeled with less than complete participation throughout the county. Perry indicated that they had not, but the spreadsheet they’d set up is such that different townships can be zeroed out. Norman Herbert added a point that Terri Blackmore, executive director of the Washtenaw Area Transportation Study (WATS), had made during deliberations of the financial task force: To the extent there’s an opt-out by a political subdivision, there’s a corresponding reduction in expenses, due to service reduction in that area.

Smith then asked state representative Jeff Irwin, whose District 53 covers most of Ann Arbor, to comment on pending state legislation.

Irwin thanked the council for taking up the issue. He told councilmembers there are as many as 15 different bills, any of which could have an impact on transportation. He urged them not to let that uncertainty prevent them from moving forward. Nothing in the pending legislation would surpass or supplant what the council is trying to accomplish locally, he said.

Jeff Irwin, state representative for District 53, which covers most of Ann Arbor.

The bill creating a regional transit authority (RTA) would create a four-county RTA, he said, including Washtenaw, Wayne, Macomb and Oakland. The best way to think about that authority is as an “overlay authority,” governing services that cross jurisdictions, he said.

The RTA would also be responsible for creating connections between regional service and local service, Irwin said. For example, he said, if the RTA establishes service along I-94, then local service needs to meet those vehicles as they come into town. The new RTA would have the same relationship with AATA as to SMART (the Suburban Mobility Authority for Regional Transportation) and DDOT (the Detroit Dept. of Transportation).

Irwin then described a bill that’s separate from the RTA bill, which would establish the ability of local jurisdictions to impose voter-approved vehicle registration fees. That would open up another funding option, he said. Irwin noted that all of these ideas have been around for a long, long time. He was not sure it is wise to hang our hopes on any of these bills that are currently pending. Local governments have been asking for decades for the ability “to be more artful” in the way they generate revenues, Irwin said, and he didn’t see any of that changing in Lansing. So we need to “seize our own destiny locally,” he said.

Irwin went on to say that if details in the bill are changed that would make Washtenaw County an afterthought, then that should be viewed with caution. However, he felt that as the RTA bill is currently written, it protects Washtenaw County’s interests, because federal dollars will still go to Washtenaw. Right now it looks like it’s moving in a productive way. He ventured that the community needs to be mindful, but not paralyzed with fear.

Transit Agreement: Deliberations – Initial Commentary

As early as during the council’s communications time toward the start of the meeting, Stephen Kunselman (Ward 3) raised the topic of the four-party agreement. He reprised his commentary from the previous council meeting on Feb. 21, 2012, when he complained that the AATA was not living up to terms of a 1974 agreement with the city to provide certain regular reports. [.pdf of Sept. 30, 1974 agreement]

By way of background, the 1974 agreement was signed in the context of litigation that was pending at the time between the city and the AATA. It was a lawsuit over the handling of $221,000 in funds dating from 1970. The AATA contended it was entitled to the money, while the city of Ann Arbor administration had claimed the money had been loaned to the AATA and needed to be repaid. So the city had subtracted that sum from the millage money collected by Ann Arbor for the AATA before the money was passed through to the AATA.

Kunselman had previously quoted from the agreement:

11. REPORTING To ensure that council is kept apprised of the AATA’s activities, the AATA will submit to Council at least quarterly a written report indicating its activities to include such key elements as levels of ridership, budget variances and other service level information.

Kunselman noted that the council had not received the specified quarterly reports. According to the agreement, Kunselman said, the council is also supposed to receive the AATA’s proposed budget for review by April each year.

At the council’s March 5 meeting, Kunselman returned to his point that the council is supposed to receive the AATA’s budget by April 1. Given that it’s now March, he said, he figured the council would have it by now.

He again complained that the AATA is sending commuter express buses to Chelsea and Canton, primarily empty in order to pick up commuters. Does that make sense? he asked, then answered his own question by saying it doesn’t make sense to him. Yet the AATA proposes to expand that kind of service, he said.

Transit Agreement: Unsuccessful Amendments – Summarized

Jane Lumm (Ward 2) proposed a series of amendments to the four-party agreement, one of which she asked Stephen Kunselman (Ward 3) to introduce – the one that would increase Ann Arbor’s representation on the board of the new transit authority. Kunselman had indicated at a previous meeting that he’d wanted to see the agreement amended in that way.

The four amendments are presented here first as a complete group, for readers’ convenience. None of them were approved by a majority of the council [additions in italics and deletions indicated with line-through]. TA refers to transit authority.

8. Contingencies to Closing. The closing of the transfer of assets and assumption of liabilities by the NEW TA is contingent upon all of the following occurring on terms acceptable to all parties:
…
(d) In exchange for the mayor’s nomination with council confirmation, of seven eight directors of New TA’s board, …
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Ann Arbor agrees … (iii) designate the New TA, as successor to AATA, as the contracting agency for use of the 2.5 mills tax levy under Section 8.18 of the Ann Arbor City Charter and allocated the tax levy in its entirely to AATA at the 2012 millage rate or as adjusted by State of Michigan statute less a municipal service charge of one percent (1%) of the annual millage at the time of the collection of taxes upon transfer from an Act 55 to an Act 196 authority. Said designation shall not become effective until AATA has submitted satisfactory evidence, which the City has independently confirmed, that the cost of the minimum level of service to the City under the NEW TA is equal to or greater than to the amount of millage funds levied and assigned to the NEW TA under this Article. After succession to the AATA, the NEW TA shall be required to maintain this level of services to millage funds relationship as a condition of continued assignment of the City tax levy.
…
g. A minimum participation level in the NEW TA of fifty percent (50%) of the jurisdictions within Washtenaw county.
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12. Termination of Agreement.
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d. Regional Transit Authority, Continuation of Agreement. The general purpose of the 4-Party Agreement is to address future governance, management, operations, and financial obligation before, during and at date of transition (“Transition Period”) from the existing services provided by AATA to a Act 196 NEW TA providing Authority-wide public transportation services. The parties acknowledge that Regional Transportation Authority (RTA) legislation may be adopted during this Transition Period which may suggest that changes to certain provisions of this Agreement are necessary or desirable to effectuate the purposes of the Agreement or that termination of the Agreement is appropriate. The parties agree that should RTA legislation be adopted prior to the completion of the transition to a NEW TA (e.g. Closing) they will, before the effective date of any RTA legislation, jointly review the provisions of this Agreement and mutually determine whether modifications are necessary or appropriate or it should be terminated.

Deliberations on each of these proposed amendments are described below.

Transit Agreement: Unsuccessful Amendment – Minimum Service Level

At the council’s Jan. 23, 2012 meeting, the council had already amended the agreement to include the requirement that the new transit authority provide “at a minimum, the continued level of services provided by its predecessor-in-interest, AATA.”

Jane Lumm (Ward 2) characterized her added language – that satisfactory evidence, independently confirmed, be provided on service levels – as a policy statement that would provide comfort. She said she appreciated the time that Eli Cooper, the city’s transportation program manager and AATA board member, had spent with her. She indicated that Cooper felt that in terms of process and substance, the amendment could work.

Tony Derezinski (Ward 2) stated that, like it or not, Ann Arbor is the bellwether, and other communities are watching what Ann Arbor does. He then adduced an analogy to which he often appeals when the council is presented with a complex proposal. It’s pretty tightly wound, he said, and when you pull at one part, other things begin to unravel.

By way of background, at the council’s Nov. 16, 2009 meeting, Derezinski made similar remarks about the A2D2 zoning initiative that some councilmembers wanted to amend. From The Chronicle’s meeting report [which also reveals The Chronicle's affinity for the verb "adduced"]:

Tony Derezinski (Ward 2) then adduced an analogy to which he’d return later in the deliberations: The zoning ordinance as proposed was tightly wound, and if they began picking it apart, it would unravel.

And commenting on the desire to amend the city’s capital improvements plan (CIP), at the council’s Feb. 1, 2010 meeting Derezinski offered similar sentiments. From The Chronicle’s meeting report:

Tony Derezinski (Ward 2) also objected to the idea of pulling out a single line item in the CIP. He used a similar analogy to the one he had adduced in describing his colleagues’ attempts to amend a recent major rezoning initiative: It’s like pulling strings off of a tightly wound ball, with the risk that it would all unravel.

At the council’s March 5 meeting on the four-party transit agreement, Derezinski wondered what signal would be sent. The amendment has an easy appeal to those who live in Ann Arbor, he said. He stated that there is much to be lost if the step of the four-party agreement is not taken – the time is now, he said. Derezinski then followed another of his habits, by offering a literary quotation, saying, “There is a tide in the affairs of men. Which, taken at the flood, leads on to fortune;” [It's from Shakespeare's "Julius Caesar," and the speaker is Brutus, who's conveying to Cassius that it's important to act while the ratio of military forces is most advantageous.]

Sabra Briere (Ward 1) asked whether Michael Ford and Mark Perry had had a chance to review the proposed amendment – Perry had not. Ford said he’d only had time to review the amendments briefly. The amendments were circulated for the first time to many of the interested parties during a recess in the council meeting that was called just before deliberations on the four-party agreement began. Ford indicated he did have some concerns about what’s being proposed. Briere said she was hoping for some insight into the economic forecasting model. Briere wanted to know if it were possible to pull out of the model what the current costs are.

Perry told Briere that the way the model was constructed was not that granular.

Responding to Ford’s comment, Lumm stated that in ensuring that the amount of service is greater than or equal to current levels, what she was asking for is not different from AATA’s resolution on the RTA, which it approved at its most recent board meeting.

Lumm then cited a document prepared by AATA service development manager Chris White. [.pdf of White's notes] White described legitimate concerns in a multi-county context for the RTA, which Lumm compared to the same concerns she had about the multi-jurisdictional situation internal to the county. She wanted to safeguard and protect the AATA. She said she’d shared a memo with the mayor a week ago and that her amendment is just addressing the concerns raised in the memo.

Ford indicated that the AATA has been working with Dennis Schornack, a special advisor to Gov. Rick Snyder on transportation, to ensure the AATA is protected. Ford said the AATA had also worked with the chair of the Washtenaw County board of commissioners, Conan Smith. Ford stated that Lumm’s amendment sounded somewhat restrictive in terms of its flexibility in delivering the service.

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

Carsten Hohnke (Ward 5) had a question for Lumm: Given that this agreement is the product of significant input among a great array of stakeholders, have you shared this language with those stakeholders and what has their reaction been? Lumm appeared annoyed by the question, saying that what she’s proposing are amendments. “I’ve done a lot of homework,” she said. On the last occasion when the four-party agreement was amended, she said, amendments were floated at 10 p.m. at night. She said she’d sent the amendments to some people on Feb. 24. In response to that, she’d had various exchanges with staff, and she’d met with Eli Cooper, the city attorney, and the city administrator. That sort of review didn’t occur with other amendments, she said.

Hohnke then observed that Lumm seemed to have taken offense at his question, but contended that he didn’t intend to offend. So Hohnke turned to Cooper, who also serves on the board of the AATA. Hohnke noted that Lumm’s amendment would make the AATA responsible for ensuring that a precise level of service was achieved according to some metric. Hohnke ventured that it would be a complex undertaking, to ensure that three, four or five years from now, the service Ann Arbor is receiving relative to the funds generated is the correct relationship.

Cooper did not give the reply that Hohnke had seemed to invite, and explained instead that it would be relatively straightforward to measure service levels in any number of ways – including revenue miles or route miles. Cooper said the amendment speaks to providing satisfactory evidence. He felt it was relatively straightforward. Said Cooper, “The term ‘benchmark’ comes to mind.” Whatever the parameter is, it’s a relatively straightforward relationship. Hohnke insisted that while something might seem straightforward in theory, it might not prove to be straightforward in practice.

Hohnke said he felt that the protection offered in Lumm’s amendment is provided through Ann Arbor’s representation on the new transit authority’s board. Ann Arbor has a heavy weight on the board, Hohnke said. So he would not support Lumm’s amendment.

Sabra Briere (Ward 1) noted that the language of the agreement [added by amendment at a previous meeting] already guarantees a minimum level of service. What was the expectation for guaranteeing it? She wanted to know if Lumm’s amendment was an added burden or an added clarification? Ford indicated that the AATA has said throughout the process that it would maintain the level of service in Ann Arbor. Briere wanted to know if the language changed anything in practice or only clarified what was already intended. [It was a distinction that eventually allowed Briere to persuade her council colleagues to approve two other amendments she brought forward later.]

Christopher Taylor (Ward 3) said he appreciated the intent of Lumm’s proposed amendment and said it provides value. But he declined to support the amendment – because future councils can ask their own questions and demand their own answers. He felt the amendment functionally seeks to bind councils in the future and seeks to do the work of the future new transit authority board. There are many opportunities to “bug out” of the process, Taylor said, and he did not want to bind future councils.

Marcia Higgins (Ward 4) indicated she was disappointed with what she was hearing. It’s up to the council to define expectations, she said. She noted that Cooper had said it would be straightforward. Ann Arbor has a right to know that it will have the right to the same level of transportation service in the future. She did not understand the amendment as binding future councils, other than to require the council to look at that data. She said she’d support the amendment, because it’s a clarification.

Margie Teall (Ward 4) echoed the sentiments Derezinski had expressed in terms of the message it sent to other communities.

Mike Anglin (Ward 5) said he saw the amendment as a clarification. Citizens have gotten accustomed to the level of service and the current millage, he said. Citizens have never decided not to levy the millage, he said. [The transit tax in Ann Arbor is perpetual, so voters do not renew it on a regular basis.] Anglin said that a wise person would ask if Ann Arbor will get a better system or not.

Anglin was dismissive of the way that AATA had sought to increase ridership, saying that the way to increase ridership would, for example, be to go to Washtenaw Community College and ask how many people would take the bus if you ran it at a certain time. Anglin said the AATA needs to get Ann Arbor on board so that residents don’t feel hoodwinked. And the more the agreement can be clarified, he said, the more people will get on board.

Sandi Smith (Ward 1) stated that the four-party agreement is not a binding agreement. She noted that if a service plan comes out that shows there’s going to be less service in Ann Arbor, and voters are asked to approve a millage with more money and less service, they won’t approve it. She saw no reason to layer things onto the agreement that will make potential partners wonder. It’s time for Ann Arbor to take a leadership position, and to let the conversation go forward, she said. She felt the amendment was micromanaging at a level that she’s not fond of.

Stephen Kunselman (Ward 3) stated that the discussion is all over the place. He said that Ypsilanti’s 1 mill doesn’t pay for what they’re getting today. He compared the $9 million that Ann Arbor contributes to transportation to the roughly $280,000 that Ypsilanti’s millage generates. It’s a question about Ann Arbor tax dollars, he said. The vote could be put to the people, he said, but it’s not yet known which jurisdictions are going to opt in.

Kunselman returned to the political tactic he’s adopted of calling the four-party agreement “the mayor’s proposal.” The AATA board consists of the mayor’s nominees and the policy direction comes out of the mayor’s office, he said. Why is AATA pursuing incorporation under Act 196? he asked. As Kunselman appeared ready to continue, mayor John Hieftje, who chairs the council meetings, asked Kunselman to speak to the amendment the council was considering. Kunselman contended that other councilmembers were also not necessarily restricting their comments to the amendment, but indicated he was content to yield if he’d have another chance to speak later.

Outcome on minimum service level amendment: The amendment failed on a 5-6 vote, with support only from Anglin, Briere, Lumm, Kunselman and Higgins.

Transit Agreement: Unsuccessful Amendment – Review on RTA Passage

Next up was Lumm’s amendment that would require the four parties to reconsider the agreement if the state legislature passed the bill establishing a regional transit authority (RTA) for Washtenaw, Wayne, Macomb and Oakland counties.

Briere noted that a new transit authority for Washtenaw County [not the same as an RTA] could change both the governance and financial aspects of the current local system. She was concerned about what happens if broader RTA is enacted, or additional local funding options are available, after a countywide millage has been approved. Would it be the expectation that the new transit authority levy the entire amount? Briere noted the history of the Ann Arbor District Library, which has historically not always levied the entire amount that voters have approved.

Ford indicated that his understanding is that the AATA would not have to levy the full amount every year. Back and forth between Briere and Ford covered the possibility that the new RTA might decide to offer service to Detroit Metro airport, which the AATA itself has recently decided to establish. If the four-county RTA were to add that service, that could mean that AATA would not be in the business of offering service to the airport – but that would also mean a corresponding drop in expenses.

State Rep. Jeff Irwin came to the podium to say that Ford was characterizing the role of the RTA correctly. If the RTA were to step in and say it was going to pay for something along the I-94 corridor, it might have an impact on how AATA provides service on Washtenaw Avenue. But ultimately it will be the board of the new transit authority that makes that decision. If there is additional, non-millage funding available, or existing millage funds are not needed for a specific service, the board could roll back the millage, or perhaps decide to meet some other, unmet transportation need.

Lumm reviewed what the amendment does and said it’s important to speak with one voice about the RTA – a lot of people are speaking about the RTA, she said. She was alluding to the fact that Conan Smith, chair of the Washtenaw County board of commissioners, had indicated in testimony made on Feb. 14 before the Michigan senate’s transportation committee that he’d be willing to see Washtenaw County give up one of its two board seats on the RTA, if that’s what it took to get the legislation passed.

Derezinski pointed out there there’s a lot of contingencies in the four-party agreement already. He wondered how hamstrung people should be. He weighed in against relying on another legislative body to act. Having served in Lansing, he said, a lot of things can come and go. He characterized it as too far-fetched to agree with.

Briere compared the effort to drafting a prenuptial agreement when you don’t trust the other person. But the four-party agreement is not marriage, so it doesn’t need a divorce, she said. She allowed that part of the reason she supports the agreement is she has “faith” that if the world changes (with the passage of RTA legislation), that the four parties would be back around the table anyway. She felt this particular amendment has gone down the road to mistrust instead of trust.

Outcome on required reconsideration upon passage of RTA legislation: The amendment failed on a 3-8 vote, with support only from Anglin, Lumm and Kunselman.

Transit Agreement: Unsuccessful Amendment – Minimum Participation Level

Next up was an amendment that required 50% of jurisdictions to participate in the new Act 196 authority as a condition to closing the deal. In introducing it, Lumm indicated that Eli Cooper said the requirement made sense, because it established a baseline for participation.

Briere ventured that in spirit, the proposed amendment was similar to an amendment that had been made at a previous meeting. That previous amendment provided for automatic termination of the agreement, if the city of Ann Arbor were the only participant in the new Act 196 authority. Briere ventured that the added language belongs in the section on automatic termination.

Smith stated that she found the 50% number entirely random. Even if half the townships participated, that could be the least amount of participation in terms of population, she said. If the minimum participation level talked about population centers or something similar, she might be inclined to support it.

Hieftje elicited from Ford the fact that after initial formation, and after the authority operated for a while, other jurisdictions could join, even after they’d initially opted out. Lumm expressed concern that a geographic district might get a seat on the board, even if only one jurisdiction in the district participates in the Act 196 authority.

Kunselman returned to a point he’s made before: Under Act 55 of 1963 (the statute under which AATA is currently incorporated), any jurisdiction can request to join. When Grand Rapids converted to Act 196, only the communities already receiving service opted in, he said. Lansing’s transit authority (Capitol Area Transportation Authority) is an Act 55 entity, and is serving all those that this community wants to have served, Kunselman contended. Under the proposal for Washtenaw County, Chelsea could opt in, without communities between Ann Arbor and Chelsea participating. That would mean running buses past communities along the way without stopping.

Briere drew out the fact that a minimum of 50% of municipalities in Washtenaw County would translate to 14.

Taylor said he’d decline to support the amendment. The four-party agreement is a framework for ongoing conversation about service and funding. If it’s of value for Ann Arbor, then the necessary steps would be taken to effect the closing. The amendment muddies the waters, Taylor said.

Invited to the podium to comment was Jeff Ammon, a Grand Rapids area attorney who’s been consulting for the AATA on legal issues surrounding transit authority governance. Ammon assured Kunselman that under the four-party agreement, “you’re not locked in.” Only if things happen in a certain way, does the closing happen. The initial formation of the Act 196 authority was simply an “empty shell.” After incorporation, they’d wait 30 days to see which jurisdictions opted out. At that point there’d be something on the map. At that point, the question would be: How does it look? Also with respect to the proposed service plan, if the council’s response is “That doesn’t look so good,” Ammon said, then that’s the end of the story, and the AATA would be back to the drawing board. The four-party agreement would just get the ball rolling, Ammon said.

Kunselman attempted to explore the history of the Grand Rapids Act 196 conversion with Ammon, which the two did briefly. Hieftje eventually encouraged the focus to return to the amendment.

Anglin noted that Lumm had indicated Cooper had been consulted on the question. Anglin said he liked the idea of setting a minimum threshold. To launch something, Anglin said, you need something with an enthusiastic start. Asked at the meeting to comment on the 50% minimum participation, Cooper appeared to put some distance between himself and the amendment. He stated that it had not been put to him as an open-ended question. He allowed that 50% seems like a reasonable critical mass.

Outcome on amendment requiring 50% minimum participation: The amendment failed on a 4-7 vote, with support only from Anglin, Lumm, Kunselman and Higgins.

Transit Agreement: Unsuccessful Amendment – Ann Arbor Majority

Kunselman put forward the amendment giving Ann Arbor eight of the 15 proposed board seats for the new transit authority. Ann Arbor, he said, would have the majority of the population and money in the new authority. He allowed that the amendment would not be in the interest of township politicians who want to make sure Ann Arbor doesn’t control the new authority.

Smith ventured that even with seven of 15 seats, if Ann Arbor wanted to accomplish some significant change in service, they’d need to talk to only one other party on the board. Ann Arbor could talk to Ypsilanti and gang up on the rest of the board. Ann Arbor would need only one other “conspirator,” she said. She felt that Ann Arbor is well-represented, but not to the point of scaring off the other participants. Politically it’s important to maintain a balance, she said.

Hohnke said he shared Smith’s view. He asked Kunselman to think about the view of other participants in the new authority. Kunselman had taken a conservative perspective on protecting Ann Arbor’s interests, Hohnke said, adding that he understands that conservative inclination. But the goal, Hohnke said, is to make some progress and find ways to collaborate countywide. Seven seats provides for very strong representation for Ann Arbor, he concluded.

Lumm said she’d support an Ann Arbor majority on the board. Under any funding plan, Ann Arbor will provide more than half the funding. She pointed out that the council had just voted down all the amendments that would conserve Ann Arbor’s interest. Adding an Ann Arbor seat to the board would be a good thing, she said, to ensure that there’s taxation with representation.

Briere told her colleagues that over the past “interminable” weeks some of the consistent messages she’d heard were: I don’t feel I’m represented by the AATA board; I don’t feel the AATA board listens to me; I want a better transit system; I want a board consisting of Ann Arbor appointees.

Standing is councilmember Sabra Briere (Ward 1). Margie Teall (Ward 4) is in the foreground, with Marcia Higgins (Ward 4) farthest from the camera.

In her conversations with constituents, Briere reported, they’d talked about the fact that the area currently served by AATA includes townships, and there are people who don’t live in Ann Arbor on the board [e.g., David Nacht] who represent a view on the board about a need for service in those areas. In the future, Briere said, she imagined the mayor might focus on making appointments to the new Act 196 board only to represent Ann Arbor’s interests, because townships will have their own representatives. She noted that the seven Ann Arbor appointees will need to cooperate internally – and getting seven people in Ann Arbor to agree on anything can be difficult, she said.

Derezinski said he would not support the amendment because of the signals it sends. One way to defeat something is to kick it down the road, he noted, and another way is to put in things that you know other communities won’t support. He cited the comment made by Norman Herbert at the start of the deliberations: Transit helps everyone, but it helps Ann Arbor the most.

Taylor also said he wouldn’t support adding an Ann Arbor seat to the board. It’s in Ann Arbor’s interest to be collaborative, he said. Ann Arbor should lead the Act 196 board not through dominance but rather through persuasion. Demanding a majority of seats is at odds with collaboration, he said.

Higgins noted that if Ann Arbor already has seven members, it can already dominate. If it’s all about collaboration, why isn’t the formula one member per jurisdiction? Either we weight it or we don’t, she said. Kunselman said he was having a hard time with this proposal because it’s creating an inequity. He said the AATA’s transit policy is to subsidize Canton and Chelsea, for example, but it’s giving Ypsilanti just a 9-month contract.

Briere said that in Grand Rapids, some of the different jurisdictions in the Act 196 authority have different millage rates. She also noted that Lansing has people sitting on boards in disproportionate amounts. Lansing and East Lansing don’t dominate the board of the Capitol Area Transit Authority, she said. If we’re asking people to support mass transit, Briere said, we need to give them a reasonable voice. She liked Higgins’ idea of disentangling the money from the representation. She said she had a problem with the idea that the wealthy can speak louder.

Higgins asked Ford how the 15-member board was determined, with Ann Arbor receiving 7 seats. Ford deferred to state representative Jeff Irwin. Irwin said he’d taken it upon himself with Terri Blackmore – executive director of the Washtenaw Area Transportation Study (WATS) – to survey community leaders. They’d met with folks from the townships and other transportation service providers in the county. In the end, he said, they’d realized that there’s a million different ways to cut up this pie. They’d put out some suggestions about what some “rough justice” looks like.

One representative per jurisdiction doesn’t seem to work, Irwin said. Basing it just on population didn’t respect the additional financial contribution of Ann Arbor. Ann Arbor has roughly 1/3 the population of the county but would be contributing more resources. They’d wanted to respect that with some additional representation. They’d concluded that Ann Arbor should get about half. Given a half-and-half deal, it’d make the most sense to go with 7 out of 15, so that as the plan was pitched to other communities, they wouldn’t feel Ann Arbor is dominating.

Outcome on amendment giving a majority of board seats to Ann Arbor: The amendment failed on a 3-8 vote, with support only from Anglin, Lumm and Kunselman.

Transit Agreement: Successful Amendments

Two amendments put forward by Sabra Briere (Ward 1) were ultimately successful. An attempt by Marcia Higgins (Ward 4) to strike the phrase “Notwithstanding anything in this Agreement to the contrary,” failed. Briere’s two amendments were as follows [additions in italics, deletions with line-through]:

7. Full Faith and Credit. The parties agree that Washtenaw County does not by virtue of its action in creating the New TA, provide its full faith and credit for any project undertaken by the New TA. The parties further agree that the Cities of Ann Arbor and Ypsilanti shall not be required to, and do not by virtue of execution of this Agreement, pledge their respective full faith and credit for any project assumed by the NEW TA at Closing or undertaken by the New TA thereafter when operational.
…
9. Ann Arbor Approval. Notwithstanding anything in this Agreement to the contrary, if voters in the City of Ann Arbor fail to approve the NEW TA Act 196 funding source at any interim vote prior to December 31, 2014, regardless of whether it is approved or not by the other voting jurisdictions, then the City shall have the right to, but is not required to (i) withdraw from this Agreement without penalty; (ii) veto any attempted termination by AATA of the AATA-City operation agreement; and (iii) refuse to designate and/or assign its millage under Section 3(a). If Ann Arbor voters fail to approve the NEW TA Act 196 funding source before December 31, 2014, regardless of whether it is approved or not by the other voting jurisdictions, then the City shall withdraw from this agreement without penalty, shall veto any attempted termination by AATA of the AATA-City operation agreement, and shall refuse to designate and/or assign its millage under Section 3(a).

In broad strokes, the amendments won support based on the fact that other councilmembers were persuaded that the amendments did not change the substance of the agreement, but merely clarified the existing intent of the language.

Outcome on Briere’s amendments: The council approved both of Briere’s amendments. The amendment on full faith and credit won unanimous approval. The amendment on voter approval and withdrawal from the agreement passed on a 9-2 vote, with dissent from Derezinski and Teall.

Transit Agreement: Council’s Concluding Deliberations

Marcia Higgins (Ward 4) wanted to know what the future is for a high-capacity north-south connector within the city of Ann Arbor.

City councilmember Marcia Higgins (Ward 4).

She said she’d advocated for such a system for 13 years and wanted to know why there was a zero on the funding line for that project. Michael Benham, AATA strategic planner, told Higgins it reflects that the project is being deferred to focus on those services that can be provided just with local funding. He told Higgins that local millage dollars would not be allocated, but state and federal dollars could be put toward it. An application has been made for preliminary engineering, he said. Higgins was content that the connector not being tabled and that it’s still a recognized need.

By way of background to illustrate how long the concept of the connector described by Higgins has been around, a series of articles from the Ann Arbor District Library’s Old News archive documents that the idea of a high-capacity, elevated guideway connector between the University of Michigan north campus, central campus, and the Amtrak station was conceived in the early 1970s. [Oct. 30, 1973][Nov. 2, 1973] [Dec. 6, 1973]

Mike Anglin (Ward 5) expressed concern that approval of the four-party agreement would mean approval of Fuller Road Station, which the council had not done. [See Chronicle coverage: "UM, Ann Arbor Halt Fuller Road Project"] He felt that the transit plan incorporates Fuller Road Station without a vote.

Benham explained that the Fuller Road Station project is in the five-year plan as a program, but there’s nothing that the financial advisory group has recommended that endorses the project. Anglin stated that the AATA is putting forward uses at the site at Fuller Road for a transit station but the city council has never taken a vote on that. Benham told Anglin that nothing precludes the council from voting on that issue. The reason the Fuller Road Station is included is that it’s a project that’s desired by many people, he said.

Benham indicated that the AATA would be publishing the detailed five-year service program in late April or May.

Sandi Smith (Ward 1) expressed her thanks to those who’d worked on the issue and said that so far, AATA has had a grueling marathon journey – but it’s just the first 5 miles. She said she’s heard consistently from emails and at the podium that Ann Arbor and greater Washtenaw County want a higher level of transportation service – it’s good now, but not good enough.

She said it’s time to vote on the four-party agreement and to vote on it in the affirmative. She hoped that her colleagues could put aside their concerns about the way the agreement had arrived at its current form. “This is what’s in front of us,” she said.

Stephen Kunselman (Ward 3) said he appreciated the optimism expressed by Smith, but maintained it’s his responsibility to do due diligence. He compared improving the transportation system to homebuilding – he wouldn’t tear down a house, when he can build an addition, he said. He described the approach that the AATA is taking as not the best way, but rather the most complex way. He ticked through a variety of other options for creating an Act 196 authority or retaining an Act 55 authority. He read aloud extensively from a document that he said he’d found on the AATA’s website, which outlines the comparative advantages and disadvantages of Act 196 and Act 55.

As Kunselman continued to read, mayor John Hieftje pointed out that Kunselman had been speaking for seven minutes. Kunselman challenged the idea that there was a time limit – but Hieftje noted that the council rules provide for one. [It's five minutes for the first speaking turn on a topic and three minutes for the second speaking turn.]

Kunselman said that if the proposal were for the city of Ann Arbor to incorporate an Act 196 authority, he’d be on board. But he objected to what he characterized as turning everything over to the county. He contended that Washtenaw County would “control” the articles of incorporation for the new transit authority.

Assistant city attorney Mary Fales was asked to comment and she noted that Section 3.04 of the articles of incorporation identifies the role of the county:

The Washtenaw County Clerk/Register shall endorse these Articles of Incorporation after their adoption by the Washtenaw County Board of Commissioners and the “New” Authority shall publish them once in a newspaper of general circulation throughout the County on a date at least 10 days, but not more than 30 days, after their adoption.

As far as amending the articles after their adoption and filing, Fales noted that it would require a 2/3 vote of the new transit authority’s board.

Carsten Hohnke (Ward 5) said he’d support the four-party agreement – because he wanted the option of talking about it some more. He responded to Kunselman’s frequent refrain that it’s the mayor’s proposal by saying that it was brought forward by Michael Ford and those who worked on it for the AATA.

Tony Derezinski (Ward 2) echoed what Hohnke said, noting it’s just the initial step and that he’s glad the council is taking that first step.

Jane Lumm (Ward 2) said she regretted there’s not more of an appetite to tighten up the language. But she said a majority of the council felt it’s not in Ann Arbor’s interest that Ann Arbor have a majority on the board or that 50% is a reasonable critical mass for minimum participation.

Kunselman then directed a question to Hieftje asking him why, because Hieftje brought it forward, was Hieftje suggesting that Ann Arbor turn this authority over to the county? Hieftje indicated that he’d respond later as to why he would be supporting the four-party agreement.

Christopher Taylor (Ward 3) said he was delighted to support the four-party agreement. Responding to Lumm’s interpretation of the financial task force’s message that things should be put on hold, he said he’d heard the financial task force say only that the funding be put on hold. The message he’d heard from the task force was that the council should forge ahead. About the agreement, Taylor said, it doesn’t bind the council to move forward, but only to do so in a particular manner if they decide to move forward. It provides full authority for Ann Arbor to “bug out” if AATA doesn’t provide full value.

Sabra Briere (Ward 1) highlighted among the various reasons to support the agreement her desire to ensure that residents get the chance to vote.

When it came time for Hieftje to weigh in, he said he thought the council had been presented with a financial plan. The task force had put a number on the amount required, but had not said what the methodology is going to be. It would still require a vote of the residents. The plan had been developed over a long period of time, with over 70 public meetings. It wasn’t something Ford dreamed up, he said.

Hieftje pointed to the support that had been expressed by the Ann Arbor/Ypsilanti Regional Chamber of Commerce and the Michigan League of Conservation Voters. Hieftje drew an analogy of the four-party agreement to another decision the council had made – on the agreement of all but one councilmember [Anglin] to build the underground parking garage. Hieftje said Ann Arbor wants to be a community that continues to grows jobs.

Kunselman then challenged the mayor to answer Kunselman’s previous question. Hieftje said he’d just done that.

Outcome on four-party transit agreement: The agreement was approved on a 7-4 vote, with dissent from Anglin, Lumm, Kunselman, and Higgins.

Gott Nomination to AATA Board

One of the mayoral nominations that the council was asked to confirm at its March 5 meeting was for the appointment of University of Michigan planner Sue Gott to the board of the Ann Arbor Transportation Authority.

Councilmembers generally vote on confirmation of mayoral nominations to board and commissions “all in one go” in the same way that consent agenda items are voted. And in the same way that individual consent agenda items are sometimes pulled out for separate consideration (which can be done at the request of any councilmember), Marcia Higgins (Ward 4) wanted to separate out Gott’s nomination from some others and to request a roll-call vote on that.

Higgins said she had some concerns with a University of Michigan employee being appointed to the board, because UM contracts for services with the AATA, and because of the weight that UM has in the community. She felt the appointment could be better used for other citizens in the community.

Stephen Kunselman (Ward 3) added that Gott would be the second UM employee serving on the AATA board, to which mayor John Hieftje replied, “I’m not aware of that.” Kunselman countered with the name of the other UM employee who serves on the board, Anya Dale. By way of background, Dale was employed by Washtenaw County at the time of her appointment to the AATA on May 17, 2010 – which earned her a dissenting vote from Sabra Briere (Ward 1). But at least as early as mid-June 2011 it was publicly known that Dale would be leaving her post with Washtenaw County to take a position in the UM sustainability office. Dale’s position within UM is not particularly high level.

Also useful by way of background is the fact that the AATA board member whom Gott is replacing was a relatively high-level administrator, Rich Robben, executive director for plant operations.

Kunselman then went on to point out to Hieftje that when the vacancy came up, Kunselman had suggested appointing someone to the AATA board from one of the jurisdictions with which the AATA has a purchase-of-service (POS) arrangement. By way of background, that suggestion had come at the city council’s Jan. 23, 2012 meeting. That type of appointment, ventured Kunselman, would perhaps start the collaborative effort for countywide transit. Kunselman noted that Hieftje had responded to his suggestion on that occasion by questioning whether it would be legal to have an elected official from a township serve on the AATA board. But Kunselman noted that David Nacht (who currently serves on the AATA board) was originally a Scio Township trustee around the time he was first appointed to the AATA board.

Kunselman stressed that Gott is a wonderful person, but said he shared Higgins’ concern that the AATA board needs a little more breadth, and the communities contracting with AATA for service have been wanting a seat on the board, he said.

Hieftje responded to Kunselman by saying that Ypsilanti is participating in the framework of the as-yet unincorporated Act 196 (U196) board, and is pretty happy they’re being represented. With Gott’s base of planning knowledge, Hieftje said, it’s appropriate that she have a seat on the ATA board at a time when plans are being made for the future. Gott has lived in the community for a very long time, Hieftje said.

Briere then asked Hieftje to help explain which skills Gott would bring to the AATA board. Hieftje said that Gott had a breadth of knowledge that covers such a wide range – she’s familiar with UM plans. He ventured that if you read her resume you’d see a lot of experience in transportation planning.

Councilmember Stephen Kunselman (Ward 3).

Tony Derezinski (Ward 2) echoed what Hieftje had said, noting that he’d worked with Gott on some issues with University of Michigan in his capacity as a city planning commissioner. Hieftje then said that people on city council also work for UM and he doesn’t see a conflict of interest – an allusion to Kunselman’s employment with UM as an energy liaison.

Kunselman countered that there’s a big difference between being an elected versus an appointed official. Kunselman then said he knew Gott from “way way back” and would support her nomination. But he lamented the fact that the opportunity had not been taken to appoint someone who represented an entity that has a purchase-of-service agreement.

Outcome: Sue Gott’s appointment to the AATA board was unanimously confirmed.

Direction on Medical Marijuana

On the council’s agenda was a resolution that would direct the city attorney, Stephen Postema, to “delay all enforcement activities against medical marijuana dispensaries and cultivation facilities except for claims that they violate Section 5:50.1(3) of the City Code [zoning regulations], until the Council amends or rejects amendments to the zoning and licensing ordinances for medical marijuana.”

The resolution reflects an ongoing tension between the city’s medical marijuana licensing board and the city attorney’s office.

That tension between the board and the city attorney’s office is reflected in a statement sent by members of the board to city councilmembers on March 2, which reads in part: “[The city attorney's office] has been aggressively trying to shut [dispensaries] down while we actively try to license them.” The statement goes on to point out that a representative from the city attorney’s office had been present at all of the board’s meetings and that the board’s recommendations had been reported to the city council. But after that, the city attorney’s office had sent out new letters to all dispensaries requesting them to provide information about how their business operates. [.pdf of entire statement from Ann Arbor's medical marijuana licensing board to the Ann Arbor city council]

The part of the city code called out for continued enforcement in the resolution, Section 5:50.1(3), specifies the zones in the city where medical marijuana businesses may be located. From the code: “Medical marijuana dispensaries shall only be located in a district classified pursuant to this chapter as D, C, or M, or in PUD districts where retail is permitted in the supplemental regulations. Medical marijuana cultivation facilities shall only be located in a district classified pursuant to this chapter as C, M, RE, or ORL.” [.pdf of Section 5:50.1(3)]

The resolution on the March 5 agenda stemmed from a meeting of the city’s medical marijuana licensing board on Feb. 28 that was convened in response to concerns by several dispensary owners, who had received letters dated Feb. 24 from the city attorney’s office. The letters make specific inquiries into several aspects of the business model of dispensaries – in order to assess whether they are in compliance with Michigan’s Medical Marijuana Act. Compliance with the MMMA is a requirement for issuance of a medical marijuana license, and recipients of the letters have license applications pending with the city. Although the legal position of the city attorney appears to be that it’s possible for a dispensary to operate in compliance with the MMMA, no explication of what that model would entail has been set forth.

Among the questions being posed to all dispensaries in the letters are the following: “Does any person or entity deliver marijuana to [Dispensary Name]? If so, does [Dispensary Name] ever pay, donate, or in any way give money to the person or entity who delivers the marijuana or to anyone else? If so, to whom is the money paid, donated, or given and how much?” [.pdf of set of letters]

The city council resolution was sponsored on the agenda by Sabra Briere (Ward 1), who is the city council’s representative to the medical marijuana licensing board. After its Jan. 31, 2012 meeting, the board submitted a required report to the council with recommendations on the issuance of the first dispensary licenses and revisions to the city’s medical marijuana ordinance. The report recommends to the council that 10 dispensaries be issued licenses.

The city council enacted zoning and licensing regulations for medical marijuana businesses at its June 20, 2011 meeting.

The resolution requests that the council decide on recommendations for amendments to the city’s medical marijuana ordinance before June 18, 2012.

The council did not reach the item on its agenda until around 12:30 a.m. Briere ventured that the item was complex and deserved the council’s attention and its “ability to stay awake,” so she moved for a postponement, a move that was met with consensus without any deliberation.

Outcome: The council voted unanimously to postpone consideration of the item to its March 19 meeting.

Liquor License Non-Renewals

The council considered a resolution with a recommendation that liquor licenses for two businesses – Dream Nite Club and Rush Street – not be renewed this year. The vote was based on the recommendation of the council’s liquor license review committee. For Dream Nite Club, the non-renewal recommendation is based on maintenance of a nuisance and patron conduct. For Rush Street, the issue relates to non-payment of $8,040.42 in taxes.

Blue dots are locations of liquor licensees. Note that the map includes licensees of all categories, not just those that have licenses permitting on-premise consumption. (Image links to dynamic map, that allows zooming and clicking and the like.)

The council’s resolution and subsequent notification of the two businesses meets the requirement of Chapter 109, Section 9:79 of the city code – that a business be notified of the council’s intent to object to the renewal of its liquor license by the Michigan Liquor Control Commission, and that a hearing be convened to afford a business an opportunity to plead its case. [.pdf of Chapter 109 Section 9:79]

Hearings for the two businesses were set for March 19, which is the soonest they could be held – 10 days after notification. The hearing officer will be Tony Derezinski (Ward 2), who chairs the city council’s liquor license review committee. Later that same day, on March 19, the city council will need to make a final recommendation to the MLCC. The MLCC’s deadline is March 31.

The council’s resolution was based on the recommendation of its liquor license review committee, which met on Feb. 23, 2012 to conclude its annual review of licenses in the city.

During the brief city council deliberations, Derezinski characterized the resolution as simply reflecting the recommendation of the liquor license review committee. He stressed that there was a time element, due to the time of notice that had to be provided to the licensees.

Mike Anglin (Ward 5), who also serves on the review committee with Derezinski and Jane Lumm (Ward 2), asked him to explain the reason that the two establishments were recommended for non-renewal. Derezinski clarified for the council that one related to police reports and patron conduct (Dream Nite Club) while the other related to non-payment of taxes (Rush Street).

Outcome: The council voted unanimously to recommend non-renewal of two liquor licenses and to set the hearings for March 19.

Greenbelt Land

The council considered a resolution authorizing the use of $82,576 from its open space and parkland preservation millage to acquire development rights to the Newton Farm property – 58.85 acres in Ann Arbor Township. The city’s contribution will be paired with an equal amount from Ann Arbor Township and matched with a federal farm and ranchland protection program grant of $158,676 for a deal worth a total of $323,828.

Deliberations on the item were limited to a comment by Jane Lumm (Ward 2), who characterized it as a strong proposal. It’s strong, she said, because it meets the goals of the greenbelt program, the city’s share is less than one-third of the cost, the township is matching the city’s share, local dollars are leveraging federal funds, and it’s adjacent to other properties protected by the greenbelt program. She said she hoped that future greenbelt acquisitions would be similarly structured.

Outcome: The council voted unanimously to approve the acquisition of development rights on the Newton Farm property.

W. Kingsley House

The council considered a resolution approving the purchase of two parcels on the northern edge of downtown Ann Arbor, at 215 and 219 W. Kingsley. The purchase price is $185,000. That will clear the way to the demolition of a long-vacant house, considered by many to be an eyesore. The money for the purchase was awarded as a pre-disaster mitigation grant from the Federal Emergency Management Agency (FEMA), which the city council accepted through a resolution passed at its Nov. 15, 2010 meeting.

The parcels at 215-19 W. Kingsley are outlined in red. Blue area is the floodway. Green area is the floodplain. Image is a screen shot from the joint Washtenaw County/City of Ann Arbor flood mapping website. (Image links to higher resolution file.)

The delay in the purchase of the property was due in part to the owner’s initial reluctance to sell the property to the city at the appraised price.

After the city acquires the land, the house on one of the parcels will be demolished and a rain garden will be installed, using stormwater utility funds as part of the city’s capital improvements plan (CIP). The parcels are located in the FEMA floodway as determined by the new map given final approval by the city council the same night the purchase was approved. [.jpg image of parcels and floodway]

The city’s public art commission, at its Nov. 30, 2011 meeting, approved the new rain garden as a project in which to include public art, establishing a project budget between $20,000 and $27,000.

W. Kingsley House: Deliberations

Sandi Smith (Ward 1), who sponsored the item on the agenda, led off deliberations by saying that she was pretty happy to be able to bring the item forward. The house had been vacant for 12-14 years, the basement has been crumbling in for some time, the garage has been set on fire, but was finally removed, she said. The house has been boarded up for around eight years.

Smith described it as a delicate balance between private property rights and dealing with nuisances. She mentioned that with the fund established at the council’s Feb. 21, 2012 meeting, now the city has ways to deal with such cases. Smith noted that the money being used for the acquisition comes from FEMA money – which is possible because the property is in the floodway.

Given that Jerry Hancock, the city’s stormwater and floodplain manager, had remained at the meeting well after midnight to field any questions, Smith invited him to the podium to describe for the council what was special about the acquisition and demolition of the property. Hancock described the history of the city’s efforts with the property as starting with an enforcement action through the city attorney’s office because of the nuisance it posed. Then the city learned it was eligible for FEMA money because of the city’s flood mitigation plan that was approved in 2007. The city felt that pursuing FEMA funding might be a more palatable enforcement path, so an application was made in 2008.

Like everything associated with the project, Hancock said, the application has taken longer than expected. FEMA issues held things up and it took a while to get clear title. The grant from FEMA covers 75% of the cost, he said, and the rest will come from the stormwater fund. The property also needed to be deed-restricted, he said – because that’s a FEMA requirement.

Instead of filling in the basement, Hancock continued, it was felt that some flood storage capacity could be established there. So a project on was put on the city’s capital improvements plan (CIP) to create a rain garden. The city hired Patrick Judd of the Ann Arbor-based Conservation Design Forum, who had also worked on the landscaping at the new city hall plaza. Part of Judd’s proposal was to coordinate with Ann Arbor’s public art commission. So, Hancock said, there will not only be a rain garden but also a public art installation at the site. Smith ventured that there would be a neighborhood block party there when it’s done.

Questions from Jane Lumm (Ward 2) and Stephen Kunselman (Ward 3) drew out the fact that the council’s resolution that night was just for the acquisition. The money had already been accepted and the rain garden did not require city council approval. Responding to a question from Kunselman, Hancock explained that a few more steps remain before a contractor can be hired to perform the demolition – a grading plan and a survey needs to be in place before it can be bid out. He estimated 4-6 weeks before a contractor would be lined up.

Mike Anglin (Ward 5) ventured that it’s going to be good to drive by a nicer-looking site. He asked about other sites that might be eligible for FEMA money for demolition. Hancock responded by saying there’s only one other site on which the city has moved forward with FEMA applications: 721 N. Main St., a city-owned property.

The city had received approval of a grant to remove two storage structures in the floodway on the 721 N. Main site, but that grant has been delayed because the city’s All-Hazard Plan has expired. The city’s emergency manager, along with the city attorney’s office, is updating that, Hancock explained. Once that All-Hazard Plan is complete, the city will be able to move ahead with that grant. However, no other sites besides the two storage structures at 721 N. Main have been identified for FEMA applications, Hancock said.

Outcome: The council unanimously authorized the acquisition of the West Kingsley properties for demolition.

New Flood Map

The council considered a resolution giving final approval to an ordinance change that will adopt a new Flood Insurance Rate Map (FIRM) for the city. Initial approval had been given by the council at its Feb. 21, 2012 meeting.

By way of background on those maps, the National Flood Insurance Program (NFIP) makes flood insurance available for properties in participating communities – Ann Arbor is a participant. If a building has a federally-backed mortgage and it’s located within the “1% annual change floodplain” (previously called the “100-year floodplain) then flood insurance is required.

Ann Arbor’s most recent FIRM dates from Jan. 2, 1992. In 2004, the Federal Emergency Management Agency (FEMA) began a map revision process for Washtenaw County. Various drains in the city were re-analyzed, using updated data, and on July 27, 2007, FEMA issued preliminary maps. After required public review, appeal and revisions, on Oct. 3, 2011, FEMA issued a letter with a final determination, indicating that the new maps would become effective on April 3, 2012. [.pdf of Oct. 3, 2011 letter] [.pdf of Dec. 20, 2011 reminder letter]

Compared to the previous 1992 maps, 321 parcels are no longer analyzed as lying within a floodplain. However, 116 parcels that were previously not analyzed as in a floodplain are now in a floodplain, according to the new maps. Building-wise, 452 structures are no longer analyzed as lying within a floodplain, while 88 buildings are now in a floodplain, according to the new maps. [See also Chronicle coverage: "Column: Digital Information Flood."]

During the public hearing on the new map only one person spoke. Thomas Partridge called on the council to go beyond this ordinance to enact construction guidelines and restrictions in Ann Arbor to give adequate protection to residents from private companies involved in construction activities that flagrantly violate noise ordinances, worker protections, and threaten health and safety of pedestrians and drivers.

The council did not deliberate on the new flood map, having entertained some discussion when the ordinance was given initial approval at the council’s previous meeting.

Outcome: The council voted unanimously to adopt the new flood map.

Park Renovations

The council considered two major contracts for renovations of city parks.

The first, for $893,030 with RMD Holdings, covers the renovation of softball and baseball diamonds at Veterans Memorial Park, Southeast Area Park, and West Park. The second, with Fonson Inc. for $786,536, will cover renovation of roads and parking lots, build paths and improve stormwater management at Buhr Park and Cobblestone Farm. Both contracts also include an additional 10% contingency.

The projects were discussed by the city’s park advisory commission and recommended for approval – the Buhr/Cobblestone project on Feb. 28, 2012, and the ballfield renovations on Jan. 24, 2012.

Christopher Taylor (Ward 3), who is one of two city council representatives to the park advisory commission, noted that PAC was particularly excited about this project. The ballfields have been an area of particular concern. Carsten Hohnke (Ward 5) remarked that anybody who’s been around the fields knows how much use they get when the weather is nice. It’s a nice step forward for those who use those amenities, he said.

Mike Anglin (Ward 5), the other council appointee to PAC, said the public should know that the city will receive more revenue down the road, because more teams will return to using the fields, given that the ballfield renovations are in the city’s Park and Recreation Open Space (PROS) plan. Sandi Smith (ward 1) confirmed with Taylor that commencement of the work will wait until after the summer season ends.

On the Buhr Park renovations, Stephen Kunselman (Ward 3) said Buhr Park is just down the street from him, so he was pleased to see potholes in the entry road taken care of.

Outcome: On separate votes, the two park renovation items were unanimously approved.

Land Use Buffer Changes

The council considered a change in landscaping and land use buffer requirements in the city code.

The first change would restrict some requirements that have been added recently just to those plans that require city planning commission or city council approval: (1) providing landscaped islands for every 15 parking spaces; and (2) providing bioretention areas in 50% of the interior landscaping areas. Administrative amendments to existing plans would not trigger the requirements.

The second change involves requirements to provide buffers between parcels with conflicting land uses. Recent amendments added requirements that properties in R3 (townhouse dwelling) and R4 (multiple-family dwelling) districts include a buffer along the side and rear property lines if the parcel is immediately adjacent to a property that is principally used or zoned as residential.

The amendment considered on March 5 would remove the R4C zoning district from the recently-added land use buffer requirement. The rationale for exempting the R4C sites from the requirement is characterized in the staff memo as due to the fact that the R4C sites “are typically located on small lots in older neighborhoods near downtown. Most R4C lots are too small to accommodate a 15 foot wide conflicting land use buffer along the entire side and rear property lines.”

Land Use Buffer Changes: Council Deliberations

Sabra Briere (Ward 1) said that when she saw the item on the agenda, she noticed how dependent the changes were on the R4C area. She noted that the R4C zoning district study committee has not yet reported its work, so she had some concerns about protections being removed for residents who live in such areas. Why does the ordinance need to be done tonight, instead of waiting? asked Briere.

Wendy Rampson, head of planning for the city, explained that the R4C item was not urgent, and might be delayed. But for the other items, she suggested it would be useful to move ahead. Administrative amendments to site plans were causing a bioswale requirement to be triggered, she said. She allowed that a petitioner can still go to the planning commission to get an exemption, but that seemed like an extra, unnecessary step.

As an example, Rampson gave a Glacier Hills nursing home construction project. The ordinance would have required the nursing home, in light of a small modification to the site plan, to take 50% of the landscape islands and convert them to bioswales. She ventured that if the council wanted to remove the R4C buffer requirement from the amendment package and move the other two amendments forward, the staff would prefer that.

Tony Derezinski (Ward 2), who serves as the city council’s representative to the planning commission, supported Rampson’s remarks. The review of the R4C/R2A zoning area has taken a long time due to the amount of the public input that has been included, he said. Rather than cut off that public input, the planning commission had decided to delay that report. Derezinski said that hopefully within the next couple of weeks, that report would be done. About the R4C/R2A review committee’s work, he said that issues like the landscape buffer are the “grist of what we were dealing with.” He said that in terms of the final recommendations, nobody got everything, but everybody got something.

Alluding to the delay in the R4A/R4C report, Stephen Kunselman (Ward 3) noted that he had paid attention to the R4A/R4C study report because the council hasn’t yet received it. But he asked if a maximum lot size within R4C was within the proposed recommendations.

By way of background, Kunselman has raised the point of placing a maximum lot size on R4C parcels in the past. From The Chronicle’s report on the council’s Oct. 24, 2011 meeting, in the context of deliberations on establishing a historic district in an area that includes R4C parcels:

Kunselman noted the issue certainly has a long history. He said he’d recently visited Chicago, where he’d seen a neighborhood that had some zoning in place that prevented the accumulation of parcels. He asked if it were possible to pass a zoning ordinance that specified a maximum lot size. The answer from assistant city attorney Kevin McDonald was: Yes, it’s possible.

Kunselman said he had no problem having a historic district study committee, but he was also looking to the existing R4C/R2A zoning district study committee. If that committee doesn’t take action, then he’d initiate a change in the zoning code to establish a maximum lot size. He said he’d hate to have something like City Place on Hamilton Place [the next street to the east from Fifth Avenue, where City Place is likely to be built]. In the Chicago neighborhood, he said, it was possible to have modern single-family homes right next to the old ones. The city has to allow for rebuilding, he said. He was open to learning and listening like [Christopher] Taylor, but concluded by saying that the council needed to move in some way.

In response to Kunselman’s question on March 5, Rampson said that the R4C committee had talked about reducing the possibilities for combining parcels. Kunselman asked for details on how that reduction of possibilities would work. Rampson said she did not know – no zoning language proposal is included in the report. What’s described in the report are concepts. The only numbers specified are in places where there was sufficient consensus. She indicated that the next step for the report would be submission to the planning commission.

So Kunselman ventured that what he was asking for won’t be in the report, which Rampson confirmed. The committee spent a lot of time getting to what the concepts are that people agree on, she said. She suggested that the council would want to spend some time going through the report, because it’s quite complex.

Kunselman ascertained that there’s sentiment on the committee to put constraints on combining lots. If that’s going to be months and months and months away from implementation, he wondered what would prevent another project like City Place from happening. [The controversial City Place project on South Fifth Avenue had combined seven parcels to create a single project.] Rampson allowed that nothing would prevent the kind of combination of lots like City Place. She characterized the R4C committee work as very deliberative. She expected that the committee’s report would be in the city council’s meeting information packet sometime in April at same time the planning commission looks at it during a working session.

Marcia Higgins (Ward 4) suggested postponing the ordinance revision for two weeks. Asked by Sabra Briere (Ward 1) why she wanted to postpone it, Higgins said she would just like to review it further.

Outcome: The council voted unanimously to postpone, until March 19, all the landscape ordinance revisions, including one that would eliminate the need for a landscape buffer for R4C areas.

Off-Street Parking Regs

The council also considered changes to its off-street parking code.

The first change reduces the exceptions allowed for front open space parking for sites that have more than one front lot line. Currently, a site with three frontages can have a parking area for two of the frontages – between the building face and the public right of way. The code revision would limit parking areas to a single frontage.

The second change would require that any new driveways serving drive-up windows in the front open space of a site be no wider than 12 feet and provide a raised sidewalk with bollards where the sidewalk crosses a drive-up lane. The change is meant to improve pedestrian safety.

The third change relates to minimum off-street parking requirements in the downtown districts, zoned D1 and D2. Developers currently have the option of making a payment in lieu of providing the required parking. The revision to the ordinance would add the option of signing a contract for parking permits in the city’s public parking system.

The council did not deliberate on the item before voting to give it initial approval.

As a change to the city’s ordinances, the revisions will need to be given a second and final approval by the city council at a subsequent meeting after a public hearing.

Outcome: The council voted unanimously to give initial approval to the new off-street parking regulations.

Dexter Avenue Improvements

The council was asked to consider authorizing an agreement with Michigan Department of Transportation for the Dexter Avenue improvements project in the amount of $2,353,425. That amount corresponds to the amount provided by the Federal Surface Transportation Fund (STPU). The project, which involves reconstruction of the street, as well as necessary utility improvements, has a total cost of about $6 million, which will be divided as follows: STPU, $2,353,425; city street millage fund, $1,407,850; city storm water fund, $1,360,635; water fund, $881,000; special assessments, $18,590. The special assessments on property owners were given final city council approval at its Dec. 6, 2011 meeting.

During deliberations, Mike Anglin (Ward 5) praised the work of the city staff in seeking the participation of the community.

Jane Lumm (Ward 2) questioned how bike lanes could be added if the curb-to-curb width did not change. The explanation from project manager Elizabeth Rolla was that the current lanes are extra wide.

Rolla also indicated that after opening the bids, the cost was about $900,000 lower than anticipated. Lumm also wanted to know how the locations of the three new pedestrian crosswalks had been decided – was it similar to the way Plymouth Road crosswalk locations had been determined? Rolla explained that Dexter Avenue is different from Plymouth Road – Dexter Avenue is just two lanes. The exact locations were based on input from public meetings, and factored in school traffic and bus traffic. Also factored in were hills and sight distances.

Outcome: The council voted unanimously to approve the Dexter Avenue MDOT contract.

Consent Agenda: Water Meters, Aerial Photography

Two items were separated out from the council’s consent agenda for separate consideration. For one of them, some confusion ensued, when Jane Lumm (Ward 2) requested a different item be separated out than the one she actually wanted to question. It resulted in the council’s reconsideration and re-voting of the steps for approving the consent agenda.

The item Lumm had wanted to discuss was a $53,340 contract with Photo Science Geospatial Solutions to do a flyover and to generate aerial photography of the city, so that stormwater rates can be computed for each parcel. The city uses a formula that depends on the amount of impervious surface on a parcel as determined by infrared aerial photography.

Lumm questioned the selection of the contractor with the highest bid. [The other bids were for $44,213 and $49,409.] The city’s head of IT, Dan Rainey, said that non-price factors outweighed the lower cost offered by other vendors, citing specifically the ability of the selected vendor to provide the service on demand, on whatever day the city wanted the flyover done. The quality of the flyover was the most important consideration, he said.

Sabra Briere (Ward 1) pulled out the other item from the consent agenda for individual scrutiny. It authorized the purchase of water meters from Midwest Municipal Instrumentation Inc. for $50,000. Briere confirmed with interim public services area administrator Craig Hupy that the devices were “smart meters” in the sense that they did not require a human agent to collect their data.

Outcome: The council voted unanimously to approve all the consent agenda items, including the two separated out for special consideration.

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: Parks Millage

Christopher Taylor (Ward 3), who serves as one of two city council representatives to the park advisory commission (PAC), alerted his council colleagues to a topic at the council’s next working session on March 12: the parks maintenance and capital improvements millage. The city staff and a PAC working group have been discussing the issue, he said. Taylor called it a preview of the public conversation, which will cover the options of millage renewal, expansion, or retraction. [The city of Ann Arbor levies a 1.1 mill tax for park maintenance and capital improvements, last approved in 2006 for a period of six years.]

Comm/Comm: Board and Commission Open Positions

Sabra Briere (Ward 1) alerted the public to a slew of open positions on various boards and commissions. She invited the public to think about applying. [Information about applying is on the city clerk's webpage.]

Stephen Kunselman (Ward 3), who serves as the council’s representative to the taxicab board, noted that among the vacancies are two openings on that board. He said the board had some serious business to address.

Comm/Comm: Chief Jones Retires

City administrator Steve Powers announced that chief of police Barnett Jones would be retiring. He thanked Jones for five years of service to the city of Ann Arbor and 30 years of service statewide. Powers indicated that the appointment of an interim would be announced at a later time. Later in the week, it was announced that deputy chief John Seto would serve as interim.

Comm/Comm: Council Rules

At the conclusion of the meeting, during public commentary, Michael Benson noted that the council had outlasted CTN. [Although the live broadcast ends at midnight, the entire meeting is recorded for broadcast later.] Benson suggested revising the council rule on public commentary reserved time at the start of council meetings so that speaking turns would be limited to two minutes instead of the current three minutes. But that would be balanced against an increase in the total time allotted from 30 minutes to 40 minutes. Such a change would double the number of people who could sign up to speak – from 10 to 20.

Benson also suggested making the first preference for those people who wish to speak on agenda items more restrictive – to require that it be an action item on the agenda. Another suggestion put forward by Benson was to model a rule for public speaking used by the University of Michigan regents, which would give first preference to those people who had not addressed the council recently.

Comm/Comm: Warming Center

During public commentary, Orian Zakai followed up on the way that mayor John Hieftje had responded to her comments at the council’s previous meeting.

At the previous meeting she’d addressed the issue of 100 units of affordable housing that were lost when the old YMCA at Fifth and William streets was demolished. She quoted Hieftje’s response: “A lot of people don’t understand that the council has been working steadily for years to replace those units.” One of the people who doesn’t understand, Zakai ventured, is the head of the Washtenaw Housing Alliance. When Zakai had asked her for an interpretation of the mayor’s response, she had had no clear idea where the 70 new units had been built, which Hieftje had described. Zakai said she and her group don’t want to get between the city and the county, but two people in such a state of misunderstanding on such a crucial issue raises doubts about how seriously the goal of ending homelessness is taken, she said.

Regarding Hieftje’s allusion to efforts to create a warming center, Zakai maintained that this had been denied by WHA. The only group working on a warming center, she concluded, is a group she’s working with, Imagine Warming Centers. The group has encountered trouble communicating with the city. The group has visited the city-owned property at 721 N. Main. She described it as needing some repairs, but because it was a workplace until as recently as three years ago, those repairs can be effected. It’s also full of furniture that her group had been told is surplus. Her group could use the furniture or sell it, she said.

Alan Haber told the council he didn’t want to repeat anything too much, but Imagine Warming Centers has been seeking a space for people who need warmth. The group had looked at private properties as well as the city-owned 721 N. Main site. They’d looked through it with the city administrator and they’d identified problems with the building. But now, Haber said, progress is getting bogged down.

Haber said the group would like to rent the 721 N. Main from the city for a year for a nominal low rent. The group would provide liability insurance and pay utilities. Members who have skills would do repairs. Longer-term improvements would be negotiated with city staff, he said. He felt the building could be safely worked in. The building is also full of stuff with real value, he said, which could be put on the market. The space would be too low-tech for Ann Arbor SPARK, he said, but could be a great productive space. The group now needed the city to say, Okay, we’ll lease it to you. He told the council to open their hearts, open their minds, open the door.

Thomas Partridge led off his turn at public commentary at the conclusion of the meeting by alluding to the late hour, saying it was almost time to plan for breakfast. He stressed the urgency of planning for government services not in the future but now. He told the council he’d come to some public meetings after standing out in snowstorms with inadequate clothing and no boots, with only a few dollars in his pocket. He told them he’d personally suffered – he’s a victim of multiple sclerosis. He said when people advocated for a warming center, they’re really calling for affordable 24-7 housing support.

Later in the meeting, Hieftje responded to the commentary by indicating that he could get a report on the units of housing that had been constructed in the city. Sabra Briere (Ward 1) prodded Hieftje to mention the ongoing meetings he’s having about creating a warming center – he said he had one on his calendar on Friday. As far as the discussion on 721 N. Main, Hieftje said there are many issues, including the location of the property in the floodway. [The parcel also arose during discussion of another item on the agenda – the acquisition and demolition of a house in the floodway on West Kingsley. The city's stormwater and floodplain manger, Jerry Hancock, said that two storage buildings at the 721 N. Main site were planned to be demolished, using funds applied for from the Federal Emergency Management Agency (FEMA).]

Comm/Comm: Israel, Palestine

Henry Herskovitz told the council that his friend Herman had called him to say he’d heard on talk radio that Israeli prime minister Benjamin Netanyahu had welcomed Obama’s statements on Israel’s right to self-defense. Herskovitz called that political code language for giving Israel the green light to attack Iran preemptively.

Herskovitz’s friend told him he’d heard on the radio that Israel is a small country, and being threatened by a neighbor, and that gives it the right to self-defense. Herskovitz said he’d asked his friend, a black man living in Detroit, how he’d feel if whites living in Grosse Pointe had evicted him in an attempt to transform Detroit to a white city. His friend had replied that he’d fight to the end to defend his right to live in his home. Herskovitz then drew an analogy from that to the history of the Middle East.

Herskovitz said that attacking Iran is nothing new for Israel. Eight years ago the drums were also being beaten for Iran.

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, March 19, 2012 at 7 p.m. in the council chambers at 301 E. Huron. [confirm date]

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The council did not reach the item on its agenda until around 12:30 a.m. and decided to postpone it, due to the late hour, without further deliberation.

The resolution reflects an ongoing tension between the city’s medical marijuana licensing board and the city attorney’s office.

That tension between the board and the city attorney’s office is reflected in a statement sent by members of the board to city councilmembers on March 2, which reads in part: “[The city attorney's office] has been aggressively trying to shut [dispensaries] down while we actively try to license them.” The statement goes on to point out that a representative from the city attorney’s office had been present at all of the board’s meetings and that the board’s recommendations had been reported to the city council. But after that, the city attorney’s office had sent out new letters to all dispensaries requesting them to provide information about how their business operates. [.pdf of entire statement from Ann Arbor's medical marijuana licensing board to the Ann Arbor city council]

The part of the city code called out for continued enforcement in the resolution, Section 5:50.1(3), specifies the zones in the city where medical marijuana businesses may be located. From the code: “Medical marijuana dispensaries shall only be located in a district classified pursuant to this chapter as D, C, or M, or in PUD districts where retail is permitted in the supplemental regulations. Medical marijuana cultivation facilities shall only be located in a district classified pursuant to this chapter as C, M, RE, or ORL.” [.pdf of Section 5:50.1(3)]

The resolution stemmed from a meeting of the city’s medical marijuana licensing board on Feb. 28 that was convened in response to concerns by several dispensary owners, who have received letters, dated Feb. 24, from the city attorney’s office. The letters make specific inquiries into several aspects of the business model of dispensaries – in order to assess whether they are in compliance with Michigan’s Medical Marijuana Act. Compliance with the MMMA is a requirement for issuance of a medical marijuana license, and recipients of the letters have license applications pending with the city. Although the legal position of the city attorney appears to be that it’s possible for a dispensary to operate in compliance with the MMMA, no explication of what that model would entail has been set forth.

Among the questions being posed to all dispensaries in the letters is the following: “Does any person or entity deliver marijuana to [Dispensary Name]? If so, does [Dispensary Name] ever pay, donate, or in any way give money to the person or entity who delivers the marijuana or to anyone else? If so, to whom is the money paid, donated, or given and how much?” [.pdf of set of letters]

The city council resolution was sponsored on the agenda by Sabra Briere (Ward 1), who is the city council’s representative to the medical marijuana licensing board. After its Jan. 31, 2012 meeting, the board submitted a required report to the council with recommendations on the issuance of the first dispensary licenses and revisions to the city’s medical marijuana ordinance. The report recommends to the council that 10 dispensaries be issued licenses.

The city council enacted zoning and licensing regulations for medical marijuana businesses at its June 20, 2011 meeting.

The resolution postponed by the council on March 5 requests that the council decide on recommendations for amendments to the city’s medical marijuana ordinance before June 18, 2012.

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

The city of Ann Arbor has received 10 applications from businesses seeking to be licensed as medical marijuana dispensaries. Their locations are indicated with the green pushpins. In January, the licensing board will decide whether to made recommendations to the city council to award licenses. (Image links to dynamic Google Map)

At its Dec. 14 meeting, the board continued to review materials that had been submitted to determine completeness of other applications, and heard an argument from a business owner that his application should be considered as a pre-moratorium business.

The moratorium had been imposed by the Ann Arbor city council on Aug. 5, 2010 for 120 days – it prohibited the future use of property inside the city for cultivation facilities or dispensaries, and was extended several times in the course of the council’s consideration of the medical marijuana issue. That consideration culminated on June 20, 2011 in the enactment of zoning and licensing requirements for medical marijuana businesses.

Ann Arbor’s local laws require that businesses operate in conformance with the Michigan Medical Marijuana Act, which was enacted by statewide voter referendum in 2008. The city has explicitly required of applicants for dispensary licenses that they explain how their business conforms with the law, including an Aug. 23, 2011 court of appeals ruling that has been interpreted by many authorities to mean that no medical marijuana dispensaries are legal. [.pdf of the McQueen case ruling]. Based on remarks made at the Dec. 14 meeting, it appears that Ann Arbor’s city attorney is open to the possibility that dispensary business models may exist that do conform to the McQueen case ruling.

Recommendations by the board on the award of licenses, along with recommendations for any revisions to the ordinance, are due to be submitted to the city council by the end of January 2012.

The licensing board’s work comes even as some marijuana advocates have begun to recruit volunteers for an eventual petition drive that would seek an amendment to Michigan’s constitution to repeal the state’s general marijuana prohibition. If successful, such a constitutional amendment would appear to remove state-level legal hurdles to obtaining medical marijuana or operating a medical marijuana dispensary. However, the legal ability of federal agents to enforce federal drug laws would be unaffected by a change to Michigan’s constitution.

A sign-up sheet for people to indicate willingness to help with the petition campaign was passed around by audience members at the Dec. 14 licensing board meeting. To place the constitutional amendment on the Nov. 6, 2012 ballot, the beginning and end dates for the signature collection period (based on typical strategies used by petition initiatives and Michigan’s election law) translate to Jan. 12 and July 9, respectively. To qualify, 322,609 valid signatures would need to be collected.

The Jan. 12 petition start date comes a day after Michigan’s Supreme Court is scheduled to begin hearing arguments in two medical marijuana cases. One involves the growing of medical marijuana in an “enclosed, locked facility” (People v. King) and the other involves the timing of a physician’s recommendation that is needed to support a defense against prosecution (People v. Kolanek).

Summary of the Status of 10 Applications

By the time of the Dec. 14 medical marijuana licensing review board’s meeting, the city had received 10 applications. Three have foundered on zoning compliance issues, but two of those businesses have filed appeals with the city’s zoning board of appeals (ZBA). Of the other seven, five have been determined by the board to have been in business before the Aug. 5, 2010 moratorium was imposed, but the other two were not.

• Green Planet, 700 Tappan St. Status: ZBA appeal
• Treecity Health Collective, 1712 S. State St. Status: ZBA appeal
• Ann Arbor Health Collective, 2350 E. Stadium Blvd. Status: zoning issue, no appeal filed as of Dec. 31, 2011
• OM of Medicine, 112 S. Main St. Status: pending licensing board decision on recommendation
• People’s Choice, 2245 W. Liberty St. Status: pending licensing board decision on recommendation
• Greenbee Collective, 401 S. Maple St. Status: pending licensing board decision on recommendation (parking space requirements are problematic)
• Ann Arbor Wellness Collective, 321 E. Liberty St. Status: pending licensing board decision on recommendation
• MedMarx at Arborside, 1818 Packard St. Status: pending licensing board decision on recommendation
• Medical Grass Station, 325 W. Liberty St. Status: pending licensing board decision on recommendation as post-moratorium business
• PR Center, 3820 Varsity Dr. Status: pending licensing board decision on recommendation as post-moratorium business

The board discussed various pieces of additional information that had been submitted since their Nov. 30 meeting. That information included items ranging from contact information to statements about any felony convictions that people associated with a business might have. Not all the information has yet been submitted, but city planner Jill Thacher concluded that there were essentially five applications for which she’d been able to put together full staff reports.

The two dispensaries generating the most discussion were Greenbee Collective and the Medical Grass Station. For Greenbee, the issue related to adequacy of parking. For the Medical Grass Station, the issue related to its status as a pre- or post-moratorium business.

Parking Requirements

Greenbee Collective, located at 401 S. Maple, drew a question from city councilmember Sabra Briere (Ward 1) about parking space requirements. City planner Jill Thacher indicated that Greenbee wanted to work with two of the adjoining parcel owners to get the additional six spaces the business would need. Wendy Rampson, head of planning for the city, noted that what’s required to make that solution work would be to get a permanent easement – it would need to come from either Kroger or Top of the Lamp.

From the audience, local attorney Dennis Hayes ventured that Greenbee was only one of two units in the building. However, Rampson explained that parking requirements are a function of the entire building. Greenbee has 8 and needs 14, said Thacher. Briere noted that the requirement is for one off-street parking space for every 310 square feet of retail space.

Briere questioned whether the existing building currently has enough parking to comply with zoning. Thacher explained that parking is based on use, not zoning. Dispensaries are treated as retail space. Briere ventured that Greenbee’s application is not “ready for prime time.” Asked if Greenbee had an option to ask for a variance, Rampson and Thacher expressed skepticism: any such variance would be granted in perpetuity and no exceptions are supposed to be granted for existing non-conforming parking. Rampson indicated that Kroger does have excess parking, but board members expressed doubt that Kroger would grant a permanent easement. Rampson clarified that the relevant parking requirements are found in Chapter 59 of the city code.

Pre- or Post-Moratorium Applications

The status of a business in operation before the city council imposed a moratorium on Aug. 5, 2010, is important – because the application process timing is different for the two kinds of businesses (pre- and post-moratorium).

The board spent much of its Nov. 30 meeting discussing the merits of the documentation provided by different businesses to indicate that they were in operation before the moratorium. At the Dec. 14 meeting, that discussion focused mostly on the Medical Grass Station.

Pre- or Post-Moratorium: Medical Grass Station

The name of the Medical Grass Station, owned by Garth Bolgos, is a play on the former use of the building – a gas station at the corner of Second and Liberty streets. The city’s concern about the location as a possible marijuana dispensary was reflected during the city council’s deliberations in the spring and summer of 2011. At one point, the idea was floated to bump the size of the buffer around schools from 1,000 feet to 1,010 feet. The tweak would have ruled out the Grass Station’s location, because the corner of its parcel would have been nipped by the buffer around Bach Elementary School.

Images are extracted from the city of Ann Arbor's maps showing the buffer zones around schools, which are depicted as salmon-colored cross-hatching. The top image shows a 1,010-foot buffer. The bottom image shows the 1,000 buffer. The yellow-highlighting, added by The Chronicle, shows the parcel where a former gas station was located – and the current site of the Medical Grass Station. The salmon-colored cross-hatching is the buffer zone, originating at Bach Elementary School on Jefferson. (Image links to higher resolution file.)

At the licensing board’s Nov. 30 meeting, board members had concluded that the Medical Grass Station had not been in operation before the council imposed its Aug. 5, 2010 moratorium. But Bolgos, the property’s owner, addressed the licensing board during public commentary on Dec. 14, saying he wanted to rectify misconceptions about when the Grass Station went into business. He contended that he was in business at the location before the moratorium was imposed, and described the documentation to that effect, which he’d provided to the city.

It included a tax bill for the property and a letter from a patient who’d received marijuana from Bolgos at the location as early as January 2009, as well as a letter Bolgos had written to the mayor. Bolgos also pointed to an article that had appeared in the Ann Arbor Observer, which described his plans to open a medical marijuana dispensary business there. The article, “Medical Marijuana Center,” was written by John Rosevear, who is also a member of Ann Arbor’s medical marijuana licensing board.

Bolgos described to the board how he’d struck a deal to sell the old gas station, but it had fallen through. [The arrangement was contingent on the developer of the neighboring Liberty Lofts getting approval from Ann Arbor's historic district commission (HDC) to demolish two houses next to the gas station. The outcome of the HDC's decision was to grant permission to demolish the gas station but not the two houses, so the deal was not completed. For Chronicle coverage of HDC deliberations from early 2009, see "Demolition in Historic District" and "Historic Commission: No Approval for Demolition"]

During the board members’ deliberations on the Grass Station, they reviewed how they’d concluded at their Nov. 30 meeting that the Grass Station needed to be considered as a post-moratorium business. Board member Patricia O’Rorke noted that both the PR Center and the Grass Station had been determined to be post-moratorium applications.

Board member Sabra Briere noted that during public commentary, some uncertainty had been raised about the Grass Station. Board member Jim Kenyon indicated that the board’s previous conclusion about the Grass Station had been based on a lapse in continuity. O’Rorke, too, noted that the board had decided it was a new business.

Briere then responded to the arguments that Bolgos had brought forth during public commentary. The documentation provided addressed the desire of Bolgos to open a dispensary, not the fact that he’d opened one, she said. From the audience, Bolgos said he had treated patients at the location since 2009 – it doesn’t matter how big or small the business is, he said.

Garth Bolgos, owner of the Medical Grass Station at Second and Liberty.

Briere asked assistant city attorney Kristen Larcom if a park bench would become a dispensary if patient met their caregiver there to receive medical marijuana. Larcom stated that those were not the facts before the board – she asked if Briere’s question related to the Grass Station.

Board member Gene Ragland asked Bolgos: Did you have an interruption in the business? Bolgos told him, no – they had to move from a different Fourth and Washington location. But he met most of his patients at the gas station, he said.

The kind of documentation Bolgos had submitted was again recited: a copy of his caregiver card; a copy of a letter to the mayor saying he wanted to open a dispensary; The Ann Arbor Observer article describing how he wanted to open a dispensary; a delinquent tax notice saying he owns the property; and a letter from a patient stating she received care there.

Briere stated that the board had heard at the Nov. 30 meeting that there was a gap in service provided by the business – that the Fourth and Washington location had ceased operation. Larcom indicated that the location had been raided by LAWNET and shut down. It was not operating and there were convictions that came out of that raid, said Larcom.

Briere concluded that the board had heard evidence that there’d been a desire to open a dispensary, not evidence that one had opened at that location. Briere assured Bolgos that if the board considered his business as a post-moratorium business, it was just as fair. Ragland clarified that pre-moratorium businesses are in the queue first, but post-moratorium businesses are “still in the queue.”

Ordinance Revision Recommendations

Ragland’s assurance notwithstanding, being in the application queue as a post-moratorium business is not as advantageous as being in the queue as a pre-moratorium businesses. That’s because the number of licenses to be granted in the first year – which is the current review cycle – is tied to the number of applications received for pre-moratorium businesses.

Board members discussed the fact that they had the ability to make a recommendation to the city council on adjusting the number of licenses, as well as a number of other points.

Ordinance Revision Recommendations: Number of Licenses

The fact that a post-moratorium application likely stands a smaller chance of being recommended for a license is not explicitly stated in the city’s ordinance. But that conclusion results from the interplay between two parts of the law. First, pre-moratorium businesses had 60 days to apply after the effective date, while post-moratorium businesses had to wait until at least 75 days after the ordinance’s effective date, which was Aug. 22, 2011.

7:504(1)
Application Submission. A medical marijuana dispensary that commenced operation prior to passage of the moratorium by City Council on August 5, 2010, shall have until 60 days after the effective date of this chapter [Aug. 22, 2011] to submit an application for a new annual license. If the medical marijuana dispensary commenced operation prior to passage of the moratorium in a zoning district where its operation is not permitted under the zoning ordinance, the application shall be for a location in a zoning district where operation of a medical marijuana dispensary is permitted under the zoning ordinance. No other applications will be accepted by the City until 75 days after the effective date of this chapter.

But the number of licenses available is capped, based on the number of applications received in the first 60 days – i.e., from pre-moratorium businesses.

7:502(4)
The first year’s licenses shall be capped at a number 10% higher than the number of complete applications for licenses submitted to the City in the first 60 days after the effective date of this chapter, but not more than 20 medical marijuana dispensary licenses shall be issued in the first year. Any license terminated during the license year returns to the City for possible reissuance.

Assuming all the applications from pre-moratorium businesses result in a recommendation for a license, the number of post-moratorium applications that could receive license recommendations would be no more than 10% of the number of pre-moratorium applications. It appears the city has received seven applications from pre-moratorium businesses. So, at the Dec. 14 meeting of the board, Sabra Briere pointed out that if the board has accepted seven applications from pre-moratorium businesses, the additional 10% would allow the board to add up to one for a total of eight recommendations to be made to the council in January 2012.

Ann Arbor medical marijuana licensing board member Gene Ragland. In the background is board member John Rosevear.

What if there are five applicants for that one additional recommendation? asked Wendy Rampson, head of city planning. Briere indicated that the board would have to make a choice. There’s no guarantee that you get a license, even if you’ve jumped through all the hoops.

Briere went on to note that the board could also recommend in January that the number of licenses be changed. Responding to questions from board members about why the number of licenses had been capped at 20, Briere told them there’d been a lot of dickering about the exact number when the council deliberated on the issue.

City planner Jill Thacher raised the question of new dispensaries that wanted to apply for a license. Briere indicated that anyone who wants to apply for this first year’s application cycle should get their application submitted. Briere didn’t feel the board wanted to see new applications in January. Thacher indicated that she’d been putting people off. She said there were two dispensaries she’d told to hold off. Briere indicated that Thacher should tell those dispensaries that they need to get all their materials in. Briere noted those dispensaries didn’t need to address Section 7:504(2)(a) – proof of operation before the council established the moratorium on Aug. 5, 2010.

Gene Ragland wondered why receiving applications would not trigger the board to convene, instead of meeting to make recommendations once a year. Patricia O’Rorke echoed the sentiment, asking why someone would need to wait a year. Briere indicated that the city council [on which she serves, representing Ward 1] did not want to be confronted with the issue more than once a year. John Rosevear said he felt that once a year was appropriate, given the complexity of the situation.

Ordinance Revision Recommendations: Timing Issues

In the course of working its way through the applications for dispensary licenses, the board has identified some aspects of Ann Arbor’s ordinance that it’s found problematic. Identified at the Dec. 14 meeting were two passages that express different timing requirements for reapplication:

7:502(8) A license issued under this chapter shall expire 1 year after the date of issuance. To renew an existing license, the licensee shall submit an application in the same manner as is required to apply for a new license no sooner than 90 days before the expiration date an [sic] no later than 60 days before the expiration date.

Elsewhere, the timing requirement is given as 70 days, not 90 days:

7:504(3b) An application for renewal of an existing license shall be submitted no sooner than 10 weeks (70 days) before the existing license expires.

Board member Jim Kenyon indicated he preferred the 90-day condition.

Ordinance Revision Recommendations: Licensing Fee

Briere noted that the board would also need to recommend the amount of the licensing fee. Board members discussed the fact that the fee would need to cover the costs of administering the license. Assistant city attorney Kristen Larcom explained that building inspections would be separate from the license fee and the license application fee – the fee for licenses per se is a separate issue, she explained. While the application fee has to be limited to administrative costs, that’s not the case for license fees, she explained.

The cost of Ypsilanti’s medical marijuana dispensary license fee was briefly discussed. It’s $2,500 for the initial license and $1,100 for renewal.

Larcom indicated she was not sure what the city’s legal advice would be. Kenyon asked why there is a license fee at all. O’Rorke ventured that it’s because you pay for the privilege. Briere noted that one key difference between the medical marijuana dispensary licenses and liquor licenses is that dispensary licenses are not transferable. Kenyon indicated he would vote for a nominal amount.

Ordinance Revision Recommendations: Entry of Premises

O’Rorke questioned why a building inspector needed to be allowed to enter the premises:

7:506(7)
An authorized person shall consent to the entry into a medical marijuana dispensary by the Building Official and Zoning Inspectors for the purpose of inspection to determine compliance with this chapter pursuant to a notice posted in a conspicuous place on the premises 2 or more days before the date of the inspection or sent by first class mail to the address of the premises 4 or more calendar days before the date of the inspection.

Larcom pointed out that the city must provide notice to the facility. O’Rorke countered that the law says that building inspectors can come in. Larcom clarified that the law did not enable the city to break in to the facility. The dispensary can refuse. If the city wants to insist on entering the premises, the city would need to go to court to determine if there’s sufficient cause, Larcom explained.

Larcom felt it’s better to keep the language in there. O’Rorke wanted to avoid having a statement in the ordinance that allows consent to entry to determine compliance with the ordinance. Larcom responded to O’Rorke by indicating that it’s up to the board to make that recommendation. Briere noted that when the city council debated the ordinance, some councilmembers didn’t like the passage at all, and some wanted to make it even stronger.

Compliance with McQueen

On Aug. 23, 2011, two months after the enactment of Ann Arbor’s local legislation, a Michigan court of appeals ruled on the McQueen case in a way that has been interpreted by many authorities to mean that medical marijuana dispensaries are not legal. [.pdf of the McQueen case ruling]

By Sept. 30, the Ann Arbor city staff’s position had evolved to include a requirement that license applicants would need to provide a statement explaining how their business conformed with the Michigan Medical Marijuana Act, including the McQueen case, as part of an application for a zoning compliance permit. A zoning compliance permit is a requirement for a license. [.pdf of Sept. 30 letter]

The McQueen ruling found that one particular business model for dispensaries, that of Compassionate Apothecary, does not conform to the Michigan Medical Marijuana Act. And at the Dec. 14 meeting of the licensing board, Gene Ragland alluded to a representation made by the city attorney to the board about a particular vision of what would be a compliant business model, and the city attorney had described what he would consider legal. Sabra Briere agreed with Ragland’s characterization, but said the board could not assume that the city attorney’s view today would be the same.

Assistant city attorney Kristen Larcom noted that additional court opinions could be issued between now and the time the city attorney gives advice to the city council about whether to accept board recommendations to award licenses. In a subsequent phone interview, Wendy Rampson, head of planning for the city, indicated to The Chronicle that her understanding was that the city attorney’s office was open to the possibility that a dispensary business model can exist that complies with the McQueen ruling. However, no written set of criteria defining such a business model has been provided.

The advice provided to the city council by the city attorney will likely depend on the nature of the business model that applicants describe in the statements they’ve provided at the city’s request.

The statement provided by Cannabis Counsel, the attorney for MedMarx at Arborside, could be typical of the kind of argument that dispensaries will make. [.pdf of letter from Cannabis Counsel regarding Arborside's business model]

The Cannabis Counsel letter lays out why the court of appeals in the McQueen case found that the Compassionate Apothecary business model was not in compliance with the MMMA:  The problem was that Compassionate Apothecary did nothing to “assist” patients in administering or using marijuana, beyond exchanging marijuana for money. In contrast to Compassionate Apothecary, argues Cannabis Counsel, Arborside does assist patients in the manner described by the court – by assisting the patient “in preparing the marihuana to be consumed in any of the various ways that marihuana is commonly consumed.” Those ways include providing patients with “cleaned prepared de-stemmed cannabis including pre-rolled joints, medibles which have been inspected, tested, cleaned, grinded and rolled, or cooked in combination with foodstuff.”

The Cannabis Counsel letter also explicates how compliance with other aspects of the MMMA are met, including maintaining a sufficient number of caregivers on site to possess all the marijuana present there. Another point of emphasis of the letter is that no “sale” of marijuana takes place, and that money is given to a caregiver to compensate for costs associated with assisting a patient in the medical use of marijuana, which does not constitute a sale of a controlled substance under the MMMA.

Next Steps

The licensing board discussed its next meeting times in the context of its Jan. 31, 2012 deadline to make recommendations to the city council on license applications and ordinance revisions. The outcome of that discussion was to establish that they’d plan to meet again on Jan. 18, 2012. The zoning board of appeals will hear appeals on zoning issues from two of the businesses on Jan. 25. And the medical marijuana licensing board could possibly meet on Jan. 30 as well, if necessary.

Present: Patricia O’Rorke, James Kenyon, John Rosevear, Gene Ragland, Sabra Briere. Also: city planning manager Wendy Rampson, city planner Jill Thacher and assistant city attorney Kristen Larcom.

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The form of the poll strongly resembled a vote by the board to recommend the dispensary for a license, leading some observers to conclude that the recommendation had been made. But a subsequent email from board member Sabra Briere indicated the board had voted that it “would have recommended MedMarx for a license, if they were making recommendations at that meeting.” Once the board takes a formal vote on the recommendations that it wants to make to the city council, the city council will still need to vote as well, in order for the license to be awarded.

Ann Arbor medical marijuana licensing board members (left to right): John Rosevear, Gene Ragland and James Kenyon. They're perusing a letter from MedMarx at Arborside Compassion to the city of Ann Arbor, stating the dispensary's position on its compliance with the Michigan Medical Marijuana Act. (Photos by the writer.)

Ann Arbor’s medical marijuana licensing board was established as part of an ordinance regulating licenses for medical marijuana dispensaries, enacted by the city council on June 20, 2011.

The licensing ordinance was enacted at the same time as a zoning ordinance, which regulates where such businesses can be located in the city. The two pieces of legislation were enacted after more than a year of consideration and deliberations by members of the city council.

On Wednesday, the board considered seven out of a total of 10 license applications that had been submitted to the city. The remaining three are for businesses located in areas not zoned for medical marijuana businesses. However, at least two of those intend to ask for a review of the city’s decision to deny a zoning compliance permit (required as part of the license application) by the city’s zoning board of appeals (ZBA).

Besides the one application on which the board voted, four of the other six applications were determined to have met the requirement demonstrating that they were in operation before the council enacted a moratorium. That moratorium was established on Aug. 5, 2010 and prohibited establishment of any additional medical marijuana businesses in the city.

The board’s work on Nov. 30 came as attitudes on medical marijuana nationally, at the state level and locally are in flux. Nov. 30 was the same day that governors from the states of Washington and Rhode Island signed a petition appealing to the federal Drug Enforcement Administration to reclassify marijuana has a drug having medical uses.

And the licensing board meeting came at the conclusion of a series of day-long seminars in different Michigan cities given on Nov. 16, 17, 29, and 30 by staff of Michigan State Attorney General Bill Schuette on how to enforce the Michigan Medical Marijuana Act. The seminars included the case law that has evolved – including the McQueen case, in which a Michigan court of appeals found that at least one business model for operating a dispensary is not consistent with the MMMA.

According to a report from The Saginaw News, Schuette’s “Clearing the Air” seminars were closed to the press. The materials provided at the seminars include a range of legal tools the attorney general believes can be used to prevent medical marijuana dispensaries from doing business. One of those tools is to apply laws on public nuisances to such businesses.

The city of Ann Arbor has sent cease-and-desist letters to medical marijuana dispensaries in the city threatening to take action against them as public nuisances. Cease-and-desist letters were received by a business as recently as Nov. 8. [.pdf of letter to zoning-non-conformant business][.pdf of letter to zoning-conformant business]

During public commentary at the licensing board meeting, local attorney Dennis Hayes noted a disconnect between (1) letters sent by Ann Arbor city attorney Stephen Postema to businesses threatening to shut them down, and (2) a licensing board that is implementing the new city ordinance on allocating licenses to medical marijuana businesses. Hayes described the situation as the “right hand doing something very different from the left hand.” Hayes encouraged the licensing board to move its “right foot to drag the left foot along.”

The board’s next scheduled meeting is Dec. 14 at 4 p.m.

Brief Background

The Michigan Medical Marijuana Act was enacted by statewide voter referendum in 2008.

The Ann Arbor city council enacted zoning and licensing requirements for medical marijuana businesses on June 20, 2011. That came after more than a year’s consideration of the issue by city councilmembers. That consideration included a moratorium on the future use of property inside the city for cultivation facilities or dispensaries, which was imposed on Aug. 5, 2010, for a period of 120 days. The moratorium was extended several times in the course of the council’s work.

On Aug. 23, 2011, two months after the enactment of Ann Arbor’s local legislation, a Michigan court of appeals ruled on the McQueen case in a way that has been interpreted by many authorities to mean that medical marijuana dispensaries are not legal. [.pdf of the McQueen case ruling]

Undeterred by the court ruling, at its Sept. 6, 2011 meeting, the Ann Arbor city council confirmed appointments to the city’s medical marijuana licensing board.

But the McQueen case still had an impact in Ann Arbor. Wendy Rampson – head of the city’s planning staff – told city planning commissioners at their Sept. 8, 2011 meeting that applicants for licenses were welcome to submit information to the city in connection with license applications, but that staff had ceased their review activity pending further direction.

Already on July 1, the city had sent a letter to known dispensaries demanding that they provide proof of operation before the Aug. 5, 2010 moratorium. [.pdf of July 1 letter] The issue is important because the licensing ordinance distinguishes between businesses in operation before the moratorium (and allowed to continue operations during the moratorium) and those not in operation before the moratorium. The ordinance gives priority to those dispensaries that had pre-moratorium operations. The number of licenses to be issued by the city is also contingent on the number of applications submitted to the city by pre-moratorium businesses.

An affidavit was not considered adequate proof of pre-moratorium operations, and the city sent follow-up letters asking for “specific proof” of operation before the moratorium. [.pdf of follow-up to July 1 letter]

By Sept. 30, the city staff’s position had evolved to include a requirement that license applicants would need to provide a statement explaining how their business conformed with the Michigan Medical Marijuana Act, including the McQueen case, as part of an application for a zoning compliance permit. A zoning compliance permit is a requirement for a license. [.pdf of Sept. 30 letter]

By Oct. 18, the city had made explicit on its webpage on medical marijuana that an application for a medical marijuana dispensary license needed only to include an application for a zoning compliance permit and an application for a re-occupation permit, not the permits themselves.

Dating from mid-August 2011, an apparent point of tension between the city staff and the licensing board concerned whose purview it was to determine the completeness of an application with respect to specific pieces of information. Based on the Nov. 30 meeting of the licensing board, weighing the evidence of pre-moratorium operations became an issue determined by the board, not city staff. But applications from dispensaries in areas of the city not zoned for medical marijuana dispensaries were not put before the board for its review.

Much of the board’s Nov. 30 discussion was framed by the specific points of application requirements as listed out in the ordinance:

7:504. Application requirements for new annual license or renewal of existing license; license requirements for new license and for renewed license.
…
2. Application Requirements for New Licensee. An application for a new annual license for a medical marijuana dispensary shall be submitted to the City Clerk on a form provided by the City for preliminary review by City staff to confirm that the applicant has submitted a complete application, which shall fulfill all of the requirements indicated on the form, including but not limited to:
(a) If the medical marijuana dispensary commenced operation prior to passage of the moratorium by City Council on August 5, 2010, then proof of the date on which the medical marijuana dispensary commenced operation shall be provided.
(b) The name and address of the medical marijuana dispensary and any other contact information requested on the application form.
(c) The name and address of all owners of the real property where the medical marijuana dispensary is located.
(d) Name, street address, and other contact information of all owners of the medical marijuana dispensary and, if the owner is a corporation, limited liability company, partnership, or sole proprietor with an assumed name, of all directors, officers, members, partners, and individuals, all of whom are considered collectively to be the applicant for the license.
(e) Name and address of all business managers.
(f) A statement with respect to each person named on the application whether the person has:
(i) Ever been convicted of a felony involving controlled substances as defined under the Michigan Public Health Code, MCL 333.1101, et seq., the federal law, or the law of any other state and, if so, the date of the conviction and the law under which the person was convicted;
(ii) Ever been convicted of any other type of felony under the law of Michigan, the United States, or another state, and, if so, the date of the conviction and the law under which the person was convicted.
(g) Proof of applicant’s ownership or legal possession of the premises.
(h) A zoning compliance permit that shows the proposed medical marijuana dispensary is located in a zoning district that would permit its operation.
(i) A temporary certificate of occupancy that shows the structure for the proposed medical marijuana dispensary meets the requirements of the applicable use group under the Michigan Building Code.
(j) Payment of a non-refundable application fee, which shall be determined by resolution of the City Council. Fees for zoning compliance permits and certificates of occupancy shall be separate from the application fee, but shall be the same amount and shall be paid pursuant to the same procedures as applied to applications for zoning compliance permits and certificates of occupancy for other uses. [.pdf of complete Ann Arbor medical marijuana licensing ordinance]

Public Commentary

The Nov. 30 meeting began with an opportunity for public participation.

Local attorney Dennis Hayes indicated that a number of dispensaries have applications on file with the city’s zoning board of appeals (ZBA) because they’ve been turned down by the planning department for a zoning compliance permit. Part of the procedures for filing an appeal with the ZBA is a meeting with city staff, he said.

Left to right: Dennis Hayes (standing), Mark Passerini, and Chuck Ream.

So far, Hayes contended, the city has been reluctant to set up meetings.

Later during the licensing board meeting, in response to a question from board member Gene Ragland, city planning manager Wendy Rampson said that of the three excluded applications, two were located in office (O) zoning districts, one was in a planned unit development (PUD) zoning district – in a building where retail was not allowed, according to the PUD. She said that of the seven applications being reviewed by the board, all meet the zoning requirements. One doesn’t have adequate parking. The standard is one off-street parking space per 310 square feet, Rampson said, noting that parking requirements are not a function of zoning, but of a property’s use. If the business is in the Ann Arbor Downtown Development Authority district, it’s exempt from parking requirements, she said.

During his public commentary, Hayes said all the people whose businesses are in areas not zoned for medical marijuana dispensaries believe they have claims to a non-conforming use. The procedure to appeal the city’s decision not to grant a zoning compliance permit is through the ZBA. Hayes said he feared substantial additional delays, because the ZBA meets only once a month.

Hayes asked the licensing board to move its “right foot to drag the left foot along.” People currently serving patients are in “ZBA limbo” for the time being, he said. If the ZBA were to accept the non-conforming use, then those dispensaries would be “back in the licensing line.”

Hayes noted that there have been a number of letters sent to cease and desist from doing business – on the assumption that those businesses are in violation of the McQueen decision, even to businesses that are appropriately zoned. A lot of effort on the city’s part has been put into preventing people from applying for licensing, Hayes said. He characterized it as the right hand doing something very different from the left hand.

Rhory Gould reported that the city staff member responsible for issuing certificates of occupancy (COO) said he’s not allowed to issue a certificate to any dispensary. Yet Gould observed that having a COO is a requirement for applying for a license. Licensing board member Patricia O’Rorke assured him: “We get it.” [The city's position is that an application for the COO, not the COO itself, is what's required for the dispensary license application.]

Preliminary Board Discussion

Sabra Briere is the city councilmember representative to the five-member licensing board. She acknowledged the difficulty of the task for evaluating the applications by saying, “I’d like to drag us into what we’re going to try to accomplish today.” There are problems in trying to move forward smoothly, she allowed, but said, “We’re going to move forward.”

Briere noted that there were seven applications present in the room, but board members had before them just a staff summary of each application. [Three city staff attended the meeting: City planning manager Wendy Rampson, city planner Jill Thacher, and assistant city attorney Kristen Larcom.] That was an effort to honor the confidentiality of information included in the applications, Briere said. She noted that board members could ask questions and get clarification from staff.

Asked if city staff could tell the board if staff would have recommended approval of an application, Rampson answered no. To create the staff report, she said, staff went through the applications and indicated whether the applications met the requirements for completeness. Thacher put together the staff summary – but here’s no recommendation on approval, Rampson said.

Assistant city attorney Kristen Larcom and medical marijuana licensing board member John Rosevear share a light moment before the Nov. 30 meeting started.

Thacher clarified that there were a total of 10 applications – seven are summarized and evaluated with respect to zoning. The other three were turned down, because the zoning compliance certification was turned down. Thacher said she’d talked to representatives for two of the three rejected applications, and they’d indicated they were going to appeal through the ZBA.

Briere drew out the fact that the cost to appeal is $500. Board member John Rosevear asked what the basis is for the $500 fee. Briere noted that this is the standard ZBA filing fee. Rampson explained that the fee covers the city’s costs in processing the appeal, which includes a mailing to nearby property owners notifying them of the appeal.

Licensing board member James Kenyon clarified with Thacher that just because the staff report indicates the requested information has been provided in an application doesn’t mean it’s passed muster, just that there’s enough information to decide.

Briere asked why staff didn’t evaluate whether an application passed muster on a particular point, if everything was complete? Thacher told Briere that Thacher’s understanding was that planning staff members were not doing that evaluation on their own and that staff would not express their opinion. Briere ventured that it was a matter of fact, not opinion. Thacher indicated it was not as straightforward as that. For example, on the issue of determining whether a dispensary was in operation before the Aug. 5, 2010 moratorium, Thacher said, a variety of different kinds of proof were presented by applicants that they were in business before Aug. 5.

MedMarx at Arborside Compassion

The board considered MedMarx at Arborside Compassion first, because licensing board member James Kenyon asked if there might be one application that would give the board a “smooth first look.” Thacher indicated that two applications were more complete than others. First up was MedMarx at Arborside Compassion – known as Arborside, and located at 1818 Packard just south of Stadium Boulevard. The site is zoned commercial (C1) and the business is not proposed to be a cultivation facility, Thacher noted. Cultivation facilities are not a part of the licensing program – that’s a zoning issue, provided only as background, Thacher said.

MedMarx at Arborside Compassion: Pre-Moratorium Status

The board first considered the ordinance requirement under Section 7:504(2)(a): proof of operation before the council established the moratorium on Aug. 5, 2010.

Thacher said it’s the one item that applicants in general had submitted the most information on, and that of those applications, Arborside was one of the most voluminous, she said.

City planner Jill Thacher shows licensing board members what some of the supporting application materials looked like.

Licensing board member Patricia O’Rorke asked if each piece of evidence submitted was to be considered adequate on its own. Thacher indicated that, no, they’re all “pieces of puzzle.” Asked if there were guidelines, Thacher said there were not. She told licensing board members that they would see that some pieces of documentation offered as evidence of being in business before the moratorium date were supportive, but others were not.

Kenyon ventured that the board was not faced with a situation as straightforward as the criteria for the I-9 Employment Eligibility Form. [That form includes three lists of specific kinds of supporting documents (A, B, and C) and a complete form must include a document from list A, or else two documents – one from list B and one from list C. ]

Thacher agreed with Kenyon’s assessment, saying the board would see a range of different documents, from the minimal – affidavits – to more robust information. Thacher indicated she’d asked for additional clarification from four dispensaries over the last two weeks about information they’d submitted.

Arborside had submitted an affidavit from its president and director, Thacher said. She drew the distinction between an affidavit – a signed sworn statement that’s notarized – and a written statement. Also included were statements from four Arborside employees indicating pre-moratorium dates of employment. Some payroll records had also been submitted.

Sabra Briere focused on the affidavits. Is that not considered sufficient by itself? Thacher told Briere the city had asked for more proof than that. Thacher said the city had asked for an affidavit and had sent out a sample affidavit for people to use.

Thacher then reviewed a timeline of city communications to dispensaries, dating from the approval of the medical marijuana licensing ordinance on June 20, 2011. The first step, she said, was to try to figure out who was in operation before the Aug. 5, 2010 moratorium. The city sent letters to those it knew were in operation, and asked for evidence they were in operation before Aug. 5. That’s because there are two application processes – one for pre-moratorium businesses, and one for post-moratorium businesses. Later, on Sept. 30, an additional letter was sent saying that in light of the McQueen case, the city requested a statement from dispensaries explaining how the dispensary complied with the Michigan Medical Marijuana Act. Letters were sent to seven dispensaries, but the city received a response only from one, she said.

The statements from employees of Arborside on Packard, Thacher said, were on letterhead and stated that they were employees before the moratorium.

Assistant city attorney Kristen Larcom and Chuck Ream talk after the licensing board meeting.

The payroll records, Thacher said, were hard to evaluate – yes, they looked like payroll records. O’Rorke asked what would constitute proof. Briere noted that after this first year, it won’t even matter – the issue of pre- and post-moratorium is relevant only to the first year’s licensing cycle.

Kenyon wondered what any other businesses would use to demonstrate they were in operation – quarterly tax filings? Briere observed that taxes could be filed without having a payroll. From the audience, Chuck Ream ventured that a lease would be evidence. Briere told Ream that a lease just shows access to a building – it doesn’t show you’re in business.

Continuing with information submitted by Arborside, Thacher ticked through other documentation meant to establish that Arborside was in operation before Aug. 5, 2010: a waiver from a contractor; a Chase checking account statement from July 13, 2010; an undated application for workers compensation insurance; an email from a commercial broker about a lease term; an April 22, 2010 lease agreement; a building inspection notice and building permit for work on the building; articles of incorporation dated June 18, 2010; and an IRS tax ID number.

Kenyon asked if there were more applicants than fit the slots for pre-moratorium businesses. Briere said that if there were only seven applications, then no. Kenyon ventured that the issue of pre-moratorium operation was moot. Thacher told Kenyon she felt he wouldn’t think it’s moot, when the board considered some of the other applications.

Weighing the documentation Arborside had provided, Kenyon said it might not establish beyond a reasonable doubt in a court of law that it was in operation as a medical marijuana dispensary before the moratorium – the business could have been selling matchbox cars versus dispensing. But he concluded that “it sure looks like it was in business.” Thacher then indicated that Arborside had also submitted a handwritten ledger of dispensing.

Briere noted that Kenyon’s question about the pre- versus post-moratorium status of businesses relates to the total number of licenses that would be granted by the city. The number of license applications from pre-moratorium businesses sets the number of total licenses available.

About Arborside, Kenyon asked: “So does this one look reasonable?” Thacher indicated yes, and it was somewhat easier to evaluate, because the city staff had known about this dispensary before the moratorium.

Briere indicated that she would accept the following as proof: the affidavits, the dispensing records, and at least one other piece of information. She said the board might discuss whether that third piece of information could be the payroll records. “Does that seem like a reasonable threshold?” she asked her board colleagues.

Gene Ragland wondered what the consequence is of signing a false affidavit. Assistant city attorney Kristen Larcom told Ragland: “Not much.” She allowed that the city could revoke the license. But the penalty for a false affidavit per se is not like making a false statement under oath in court. Larcom went on to state that it’s hard to say what proves anything – the city had created an affidavit template as a suggestion, but was not necessarily saying that’s enough. Larcom said that staff did not assume people are going to be dishonest, but staff would like to see more evidence beyond the affidavit. It’s up to the licensing board to decide whether the documentation is sufficient to make the recommendation for granting a license, Larcom said.

Kenyon ventured that if city staff knew about Arborside before the moratorium, that seemed reasonable. Briere noted that the goal was to find objective criteria.

O’Rorke wondered if the way they were discussing Arborside was an example of how the board would eventually discuss applications. Briere clarified: “We’re doing it now.”

Kenyon agreed with the three-point assertion Briere had made about why she felt Arborside had adequately documented it was in operation before the moratorium.

MedMarx at Arborside Compassion: Other Application Requirements

Thacher continued with other points of the application: Section 7:504(2)(b) name and address of dispensary and contact information – yes; Section 7:504(2)(c) name address of property owners – yes.

For Section 7:504(2)(d) – the names of all owners of the business including all directors and officers of an LLC, Thacher said, “This tripped up quite a few people.”

Based on board and staff discussion, the ownership of Arborside had apparently changed. Kenyon wanted to know if the pre-moratorium status of a business could be transfered to the new owners of a business? He also wanted to know if the sale was an administrative sale – with the same principals – or if there were new parties involved.

Briere asked Rampson to put it in the context of a proposed development: If someone were applying for a zoning or building permit, would the transfer of ownership matter? Rampson ventured that a rough analogy might relate to the legal authority of someone to sign a development agreement being contingent on ownership or control of land. But Rampson brought the focus to the rationale for wanting names of all business owners. She noted that the reason for the requirement is to find out if someone who is associated with the business has a felony conviction.

Continuing through the list of items that Arborside had submitted, Thacher arrived at Section 7:504(2)(f), the statements from everyone named on the application – business owners and managers – that they did not have a disqualifying felony conviction. Ragland wanted to know if a background check had been run on each person. Larcom told him the best they could do is send a request to the Michigan State Police, because LEIN (the Law Enforcement Information Network) couldn’t be used.

Briere noted that licensing eligibility requirements are silent with respect to non-drug-related felonies like robbing a bank or committing a murder. Information on all felonies is required to be submitted as a part of the application, but it’s a discretionary decision by the board and the council as a whole for those felonies not involving drugs.

Later during the meeting, John Rosevear initiated a discussion on the merits of the drug-related felony exclusion – did it matter if a conviction had taken place in the early 1970s?

Speaking to the set of applications as a whole, Thacher said that some were missing a person or two for the set of statements about felonies. One had a record that would be forwarded, but had not yet been provided.

The set of application materials required in the licensing ordinance calls for a zoning compliance permit: Section 7:504(2)(h). Ragland ventured that the city had added a requirement that compliance with the Michigan Medical Marijuana Act be demonstrated, including the McQueen decision.

Rampson observed that compliance with the MMMA was in the ordinance language, and after the McQueen case, the city sent out letters requesting that dispensaries explain how they were in compliance with the MMMA, including the McQueen case. Briere asked if the decision had been made at the staff level not to grant a zoning compliance permit? Thacher responded by indicating that Arborside had sent a letter on that topic to the city and that it’s in the city attorney’s office. Thacher said that compliance with zoning is noted as staff comments. She noted that Arborside has a certificate of occupancy.

Briere then asked her board colleagues: “What would you like to know that you don’t see here?” She herself said she found the application compelling, but said she’d like to see the letter that’s in the city attorney’s office explaining how the business complies with the MMMA.

The letter from Arborside to the city stating how its business conformed to the MMMA, including the McQueen decision, was examined in turn by members of the licensing board.

After the letter was passed around from board member to board member, Briere ventured that maybe it would be good to have a shredder next time. Multiple copies could be created and then shredded at the conclusion of the meeting. It’d be a waste of paper, she allowed, but would be more convenient. Rampson noted that no copies had been made of the applications themselves but that Thacher had drafted the staff reports so as not to use any names. Rampson suggested that if multiple copies were created, they need not be shredded – staff could collect and store them.

Kenyon indicated that he wanted to get through at least one application that day. Given Briere’s comments about Section 7:504(2)(a), the application from Arborside looks complete, he said. Arborside would not go to this trouble to be dishonest, he said. Ticking through all the requirements in the application, Kenyon moved to recommend a license for Arborside. After getting a seconding motion from Rosevear, the board voted.

Outcome: The board voted unanimously that it would recommend that the city council award a medical marijuana dispensary license to MedMarx at Arborside Compassion. Once a year, the board is supposed to make its license recommendations and suggestions for ordinance changes – that will occur in January 2012.

OM of Medicine

The board began its deliberation on OM of Medicine with the issue of the pre-moratorium status of the business – Section 7:504(2)(a) of the ordinance.

OM of Medicine: Pre-Moratorium Status

Briere said she would consider the affidavits of the business owner, property owner and the receipts of membership applications as evidence of pre-moratorium operation.

Ragland said he felt there were a lot of parts of the elephant in the materials and if you put them all together, there’s an elephant. Briere responded by saying the board was trying to establish minimum standards for the requirement. Kenyon agreed with Briere’s set of evidence, but added the bank statements. Asked for clarification of the bank statements, Thacher indicated that the statements were records of deposits and debit card withdrawals. Kenyon said that receipts from purchases would be compelling – you don’t buy vaporizers if you’re not going into business, he said. Briere said that “inventory” would be an item she felt the board should count.

OM of Medicine: Other Application Requirements

Considering other elements of the application in more detail, Briere said it looked like there are essentially three partners who consider themselves the business owners. Thacher noted that some additional information – indicated as still requested on the staff report – now has been provided. The entity is a nonprofit, which in turn is managed by the LLC. The required information has been provided for the nonprofit entity, but not the LLC, Thacher said. Briere ventured that what the city now needed is a list of LLC members.

Thacher responded by saying that the additional information had just been received that day. Turning to Larcom, Thacher said she didn’t want to put Larcom on the spot, but she was not sure if the LLC members needed to be named in the application, given the arrangement between the nonprofit and the LLC. Larcom indicated that the city could not get all the owners’ names associated with the LLC from the state – that needed to come from the applicant.

In the board’s discussion of the application, it emerged that another missing piece in the application was under requirement Section 7:504(2)(h) for a zoning compliance permit. The city now expects an explanation of the conformance of the business with the Michigan Medical Marijuana Act, including the McQueen case, as part of an application for a zoning compliance permit.

In the audience, Mark Passarini Passerini of OM of Medicine indicated he wanted to address the board for clarification. He was told he was not required to do so, but volunteered to step forward. He told the board it appeared to him that in the board’s view, his application was missing two things: (1) a membership list in the LLC; and (2) a letter describing the dispensary’s conformance with the McQueen case.

He told the board that by Thursday morning the letter would have arrived in the mail to the city. As for the LLC, he said the LLC manages the nonprofit. In response to a question from Kenyon, Passerini stated that the nonprofit pays rent to the LLC. He felt that the names for the nonprofit owners was all that’s necessary, but that he didn’t have a problem providing the ownership information for the LLC as well.

Briere asked Larcom if receiving rent from the nonprofit counts as being involved in the dispensary operation. Passerini clarified further that the LLC doesn’t own the real property. Larcom ventured that if the LLC has some other role than being the real property owner, then as long as Passerini didn’t have a problem with it, she felt it was “better safe than sorry.”

Rosevear sought to summarize: “What does he have to do?” Passerini assured the board: “We can get you what you need.” Briere indicated that they needed the names of the LLC owners, plus a statement from each owner with respect to felony convictions. Larcom asked Passerini if that made sense to him – yes, he replied.

Outcome: The board did not vote on OM of Medicine’s application.

General Consideration of Pre-Moratorium Status

For the remaining five of the seven applications, the board then settled on a strategy of looking just at the requirement in Section 7:504(2)(a) – pre-moratorium status.

Ann Arbor Wellness Collective had submitted affidavits and articles of incorporation for a nonprofit dated May 11, 2010. It also submitted evidence of web hosting set up before the moratorium. Following the three-item guideline that Briere had floated earlier in the meeting, Rampson asked: “Which are the three items?” Briere said she was happy with the two affidavits, but would like to see transactions or receipts. O’Rorke indicated she was content with the two affidavits and the web hosting. Briere felt that establishing the web hosting might be too close to the moratorium date.

Ragland felt the two affidavits were fine. O’Rorke suggested that Rampson “throw in” web hosting as well.

For the Medical Grass Station at 325 W. Liberty, there were apparently no affidavits filed as a part of the application. Briere indicated she did not believe there was a business at that location before the moratorium.

From the audience, Dennis Hayes ventured that the Grass Station’s application had been stalled by the city’s historic district commission – the business is located in the Old West Side historic district. Briere stressed that the question the board was looking at was whether the business was open before the moratorium. Back and forth among Hayes, staff and Briere indicated that the Grass Station was meant to be a successor to a business at Fourth and Washington. Rampson confirmed that there were no affidavits included in the application and there were different names on the two businesses. Briere said she felt the Grass Station’s application could not be considered except as a post-moratorium applicant.

Kenyon wanted to know what the acceptable business transitions were. As an example, Kenyon gave Amazing Beans, which was previously roasting coffee beans in Ann Arbor. Mighty Good Coffee bought that business, Kenyon said. It was not the same business, he said. The consensus on the board was that the Grass Station application would need to be considered as a new business established after the moratorium.

For the Greenbee Collective, Keynon felt that having patient records is good, but not having them is not bad. Briere indicated that she would accept patient records and affidavits.

For People’s Choice, Rampson said the location for the application was new – it had started out originally on Main Street. Briere wanted to know if any of the ownership had changed. Rampson said that People’s Choice had not yet provided all information about its directors. It had provided articles of incorporation dated July 12, 2010 and patient sign-in sheets signed on Aug. 3, 2010.

For PR Center LLC, affidavits had been submitted, along with a client code of conduct and patient sign-in sheets. Kenyon asked what the significance of the affidavit of a former property owner was. Briere noted that the business had also moved.

The consensus of the board was that PR Center and Grass Station’s applications would be considered as applications from businesses that were not in operation before the moratorium.

Summary of Application Status on Nov. 30

Summarizing the board’s discussion, Briere said that of the seven applications, five were eligible to move forward and one of the five had received the board’s consensus for eventual recommendation for approval.

For the other four, the city is in the process of getting a complete application for elements other than requirement in Section 7:504(2)(a), which the board had concluded the four applicants had satisfied – being in business before the moratorium.

Rampson would continue to work with applicants to get information, and Rampson confirmed that the board would receive revised staff reports for its next meeting.

Next Steps

The medical marijuana licensing board meets next on Dec. 14 at 4 p.m., when it will continue its review of the license applications. Board members discussed the fact that by the city’s ordinance, it will need to report to the council in January 2012 with its recommendations for licenses and recommendations on any revisions to the licensing ordinance.

Based on the cease-and-desist letters sent by the city and the city’s requirement that dispensaries explain – as part of their zoning compliance permit applications – how they comply with the Michigan Medical Marijuana Act, including the McQueen decision, the city’s implicit legal position may be that it’s not technically possible for a medical marijuana dispensary to conform with the state law.

That position would inform any legal advice that’s provided to the city council before it votes on any recommendations it receives formally from the medical marijuana licensing board.

Present: Patricia O’Rorke, James Kenyon, John Rosevear, Gene Ragland, Sabra Briere. Also: city planning manager Wendy Rampson, city planner Jill Thacher and assistant city attorney Kristen Larcom.

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Stephen Kunselman (Ward 3) peruses a marked up copy of medical marijuana legislation. (Photos by the writer.)

On Monday, before the postponements, the council amended both medical marijuana laws, making changes to the versions to which they’d already given initial approval – all city ordinances must receive two affirmative votes at different meetings of the council. Based on the amendments approved Monday night, the votes taken on June 6 will likely count only as the first reading. If the council makes a substantive change to an ordinance after its initial approval, then the ordinance must receive an additional first reading.

Public commentary during the evening included remarks from several medical marijuana advocates, who have become a familiar cast of characters over the past year. One highlight of that commentary included corroboration of a 2004 sidewalk encounter – between a medical marijuana petition circulator and the city attorney – which had been described during public commentary at the council’s previous meeting.

Other public comment at Monday’s meeting focused on the upcoming fiscal year 2012 budget approval, with many of the remarks centered on human services funding. The council had a specific resolution on its agenda that would have allocated funding to local nonprofits that provide human services support – but the council decided to postpone the item. The funding level in the resolution would have been about 9% less than fiscal 2011 funding.

Remarks during the budget public hearing by the president of the local firefighters union focused on the number of deaths due to fire over time. During council communications, Stephen Rapundalo (Ward 2), the chair of the council’s labor committee, reiterated a point he’s made before – that if unions make concessions on their contribution to the city’s health care plan, they can mitigate some (but not all) of the currently planned layoffs.

Public commentary at Monday’s meeting also featured remarks from county clerk Larry Kestenbaum on the following day’s single-issue election, along with an update on possible changes to state election law.

The council unanimously approved the site plan, development agreement, and brownfield plan for Packard Square, a residential development planned for the former Georgetown Mall property. Two days later, the county board of commissioners postponed their approval of items related to the Packard Square brownfield plan.

In other business, the council set a public hearing on a tax abatement for Sakti3; approved several interagency technology agreements that allow for partnership between the city, Washtenaw County and the Ann Arbor Transportation Authority; and postponed consideration of some large vehicle purchases. The council was also introduced to Paul Krutko, new CEO of Ann Arbor SPARK, the local economic development agency.

Also at Monday’s meeting, Washtenaw County commissioner Yousef Rabhi explained how his interest in public service originated in connection with the Buhr Park Wet Meadow project, led by Jeannine Palms. Palms and others involved with the project, which began in 1996, were honored with a mayoral proclamation. 

Medical Marijuana

Before the council were two local laws on medical marijuana, one on zoning and another on licensing. Both laws had previously received initial approval, but after approving several additional amendments to both proposed laws on Monday, the council decided to postpone them to its June 6 meeting.

• Clean .pdf of zoning regulations as amended May 2, 2011
• .pdf showing how zoning was amended on May 2, 2011
• Clean .pdf of licensing regulations as amended May 2, 2011
• .pdf showing how licensing was amended May 2, 2011

The medical marijuana zoning ordinance received its initial approval by the council at its Oct. 18, 2010 meeting. The delay since the initial Oct. 18, 2010 zoning vote stems from the city of Ann Arbor’s strategy for legislating zoning and licensing of medical marijuana businesses. That strategy has been to bring both licensing and zoning before the city council at the same time for a final vote.

Assistant city attorney Kristin Larcom (left), councilmember Sabra Briere (Ward 1) and city attorney Stephen Postema before the start of the May 2 meeting.

The context for development of zoning regulations was set at the council’s Aug. 5, 2010 meeting, when councilmembers voted to impose a moratorium on the use of property in the city for medical marijuana dispensaries or cultivation facilities. The council also directed the city’s planning commission to develop zoning regulations for medical marijuana businesses.

Subsequently, the city attorney’s office also began working on a licensing system. The council undertook several amendments to the licensing proposal at four of its meetings over the last three months: on Jan. 3, Feb. 7, March 7 and March 21. The council finally gave its first initial approval to the licensing proposal at its March 21 meeting. [.pdf of Michigan Medical Marijuana Act]

Medical Marijuana: Public Comment

Chuck Ream thanked the council for their work. In terms of growing medicine, council should drop all that language on cultivation facilities, he said. Such facilities are already regulated under state law. He also asked the council to drop record-keeping requirements – such requirements would create a list of “juicy targets” for prosecution. He told the council that they held the lives of good people in their hands.

He asked the council not to keep city attorney Stephen Postema in charge of the medical marijuana legislation or it would never get finished. He reminded the council of the remarks made at the April 19, 2011 council meeting by Trena Moss, who reported a 2004 sidewalk encounter with Postema, when she was gathering signatures for the petition to place a local charter amendment on the ballot – it eventually passed. According to Moss, Postema had told her that he had a strategy to block it, even if voters approved it. Ream has conveyed to the council the statement written by Moss on April 23, 2004 and the photo “line up” out of which she identified Postema as the man she’d encountered. Ream asked councilmembers to protect caregivers like they would protect a woman’s right to choose.

Rhory Gould began by saying Ream is hard to follow – Ream had said everything so well. Gould said he is a longtime Ann Arbor resident and a registered voter. He thanked the council for their thoughtfulness and hard work, and for considering the needs of patients and caregivers. He called the ordinances well-written, but issues remain that still need to be addressed, he said.

Keeping records for caregivers and cultivation facilities is a bad idea, Gould said. Landlord records are also a bad idea, he said. There should be no dollar amount on labels. That requirement is motivated by the best of intentions but is not necessary. He asked the council to move forward by passing a medical marijuana ordinance that addresses the needs of caregivers, patients and residents of Ann Arbor.

Kirk Reid thanked the council for listening. He identified himself as a patient who suffers from multiple sclerosis. He told the council he would never sign up under the proposed Ann Arbor ordinance, citing the vagueness and uncertainty of words such as “deem appropriate,” “deem to prohibit” and “justification.” Whose justification? he asked. He invited the council to sit down with patients and caregivers and work with them.

John Henry Kaiser had signed up in advance to speak to the council, but when his name was called, Ream told the council that Kaiser is a cancer patient, and could not attend.

During his turn at public commentary reserved time, Thomas Partridge touched on a range of topics, but also included his view that “we do not need Ann Arbor to be known as the Marijuana Headquarters of the United States.”

Dennis Hayes thanked the council for giving advocates the right to speak. He allowed that he and Partridge didn’t agree about much, but would agree on the importance of the special education millage that was on the ballot the next day – everyone should pay attention to that. He said he’d previously made remarks about proposed amendments. He said he would welcome an opportunity to take a look at the amendments before the council voted. It’s important to pay attention to problems of regulating caregivers. He encouraged the council to take a lighter hand rather than a heavier hand. Ream reminds him frequently, Hayes said, that there are rights in the state statute, which shouldn’t be nullified by the local ordinance. The council should pay attention to what voters have said, as well as patient and caregiver needs.

Medical Marijuana Zoning: Council Deliberations

In broad strokes, the zoning regulations stipulate where medical marijuana businesses can be located geographically. From the regulations as amended on May 2, 2011:

(3) Locations of medical marijuana dispensaries and medical marijuana cultivation facilities.
A medical marijuana dispensary or medical marijuana cultivation facility may be located in the City only in accordance with the following restrictions:
a) Medical marijuana dispensaries shall only be located in a district classified pursuant to this chapter as D, C, or M, or in PUD districts where retail is permitted in the supplemental regulations.
b) Medical marijuana cultivation facilities shall only be located in a district classified pursuant to this chapter as C, M, RE, or ORL.
c) In C districts, buildings used for medical marijuana dispensaries or medical marijuana cultivation facilities shall meet the minimum parking requirements of Chapter 59 for retail uses, with no exceptions for existing nonconforming parking.
d) No medical marijuana dispensary or medical marijuana cultivation facility shall be located within 1000 feet of a parcel on which a public or private elementary or secondary school is located.

The deliberations by the council dealt first with the challenge of handling the vast array of changes to the text of the zoning regulations, which were last before the council for consideration at its Oct. 18, 2010 meeting. On that occasion, the council had given the zoning regulations its initial approval.

The sheer number of changes to the text led to discussion at the outset on how to proceed – line by line, or all in one go. Very early on in the deliberations, the council suspended its rules on the number of speaking turns allowed by councilmembers on each motion – they’re ordinarily limited to two turns.

Medical Marijuana Zoning: Amendment – Omnibus Staff Recs

Sabra Briere (Ward 1) began by moving all of the amendments recommended by city staff at once.

She asked city attorney Stephen Postema to summarize the changes. He explained that many of them were motivated by a desire to coordinate the language in the zoning regulation with that of the licensing scheme.

For example, the legislative intent section for the zoning is now just what the licensing says. Five definitions are now taken straight from the Michigan Medical Marijuana Act, Postema said. Other words and phrases have specific definitions – for cultivation facilities, dispensaries and home occupations. They’re unique to the zoning ordinance, and aren’t included in the state statute, so they’re defined.

Postema said the recommendations for amendments were sent to council on April 26, so he felt the council had had time to look them over.

By way of example of the kind of changes that were included in the staff-recommended amendments, the new definitions included one for “medical marijuana cultivation facility”:

ii. “Medical marijuana cultivation facility” means building [sic] where marijuana plants are being grown in compliance with the MMMA, other than as a medical marijuana home occupation.

New in that definition was the inclusion of “medical marijuana” as part of the term to be defined. That entailed inserting “medical marijuana” before instances of “cultivation facility.”

Marcia Higgins (Ward 4) asked about a revision that struck “medical” from the phrase “medical marijuana plants”:

In a single family dwelling in any zoning district, no more than 72 medical marijuana plants shall be grown on the premises, regardless of the number of registered primary caregivers and/or registered qualifying patients residing in the dwelling.

Postema said that when it’s just the plants themselves, it’s just “marijuana” – because the state statute doesn’t call the plants “medical marijuana.”

Councilmembers then expressed uncertainty as to the process for approving the entire set of amendments recommended by the city attorney’s staff. One approach would have been first to vote on the set of amendments, then consider additional amendments, voting on them as well. A second approach would have been to amend the proposed amendments.

The consensus appeared to be that they’d take the first approach. But mayor John Hieftje indicated there would not be a vote on all the staff-recommended amendments. That statement was met with surprise from some councilmembers. Higgins sought confirmation: “We’re voting, right?” Christopher Taylor (Ward 3) indicated that he did not understand the process. Carsten Hohnke (Ward 5) noted that after voting, additional amendments could be brought forward.

Briere stated that it’s the council’s choice how to proceed. She’d earlier begun to go through her own proposed amendments, but appeared now ready to vote on the staff-recommended amendments, then consider additional amendments.

The council opted to vote on the staff-recommended amendments, then consider other amendments.

Outcome on Omnibus Amendment: The council unanimously approved the set of staff-recommended amendments.

Medical Marijuana Zoning: Amendment – Code Reference

Sabra Briere (Ward 1) proposed the following amendment [deleted material is struck through; added material in italics]:

h) An annual zoning compliance permit signed by the owner shall be required, and must be renewed prior to the anniversary date of the issuance of the original permit shall be required consistent with Section 5:92.

She noted that zoning compliance permits are not unique to medical marijuana facilities – they have very broad requirements. She apologized to Marcia Higgins (Ward 4) for referencing another section of the code. Briere was alluding to Higgins’ historical objections to referring to other sections of code, which forces the reader to look up some other section. [.pdf of Section 5:92 of the city code]

It’s “simple business compliance,” no more or less than any other business, said Briere. The rationale behind the amendment was that the ordinance should not convey the idea that any group is being singled out or that records are being kept on a group of people.

Higgins confirmed that in the licensing scheme, the zoning compliance permit is not handled by the licensing board.

Tony Derezinski (Ward 2) asked city attorney Stephen Postema what his opinion was. Postema said the reason the language had originally been included was to let people know what the requirements are without having to go back and look at another part of the city code. Referencing the other section is also acceptable, he said.

Outcome on Amendment: The council unanimously approved replacing specific requirements with a reference to Section 5:92.

Medical Marijuana Zoning: Amendment – Plant Limit

The zoning regulations already included a limit of 72 marijuana plants in connection with a business operated as a home occupation.

Sabra Briere (Ward 1) proposed an amendment that added a limit of 72 plants on the premises of any medical marijuana cultivation facility. That’s a maximum of 72 plants per address, she said.

City attorney Stephen Postema focused the council’s attention on the fact that a “medical marijuana cultivation facility” is defined as a building where plants are being grown.

Marcia Higgins (Ward 4) wondered what the difference is between a cultivation facility and a home occupation, if both are limited to 72. Briere explained that essentially it’s expected that it will be caregivers who grow the plants – either in their own home, or not in their own home. If they did not grow in their own home, that would make it a cultivation facility.

Outcome on Amendment: The amendment limiting the number of plants in a medical marijuana cultivation facility to 72 passed, with dissent from Higgins.

Medical Marijuana Zoning: Amendment – Home Occupation

Sabra Briere (Ward 1) offered another amendment very much in the spirit of a previous one that removed a description of specific requirements and instead referenced another part of the city code – Section 5:92.

A list of (a)-(j) items were reduced to just four with Briere’s amendment.

Tony Derezinski (Ward 2) again wanted city attorney Stephen Postema’s opinion, who characterized it as the same issue they’d looked at before. Briere reiterated the rationale – if people are not familiar with the entire code, they may read the zoning regulations on medical marijuana as if the city is establishing special rules for a special category of people. That’s avoided by reference to other code sections.

Mayor John Hieftje agreed with that strategy. Sandi Smith (Ward 1) wondered why one of the items had been left in the section: “No transfer of marijuana to registered qualifying patients other than those residing in the dwelling shall occur.” Smith said it did not involve any vehicle trips, because there are no home visits. She wanted to know why the clause was still in there.

Postema said this was consistent with the language approved a long time ago. Smith said she understand that, but it’s one of three surviving clauses in the section – it mystified her. It’s irrelevant if you say the transfer can’t occur, she said. Postema told Smith that the council had talked about the fact that it didn’t want transfers to take place except at patients’ homes. If that’s not what the council wishes, then it can be changed.

Christopher Taylor (Ward 3) also supported deletion of the clause. He said it struck him as interference – an unnecessary burden. If other restrictions are consistent with Section 5:92, then he felt it was a reasonable balance.

Carsten Hohnke (Ward 5) said that looking through all the changes, it makes perfect sense. The clause in question is highlighted as one exception, so he supported Smith’s additional amendment. He said he was not sure why they would call out transfers specifically.

Hieftje noted that with a 72-plant limit, that amounted to a limit on the number of clients.

Stephen Kunselman (Ward 3) asked Wendy Rampson, head of the city’s planning department, to explain zoning compliance permits. He wanted to know how Section 5:92(1) would be applied, which reads in part:

It shall be unlawful to begin the excavation for the construction, the moving, alteration, or repair, except ordinary repairs as defined in Chapter 98 of the Ann Arbor City Code, of any building or other structure, including an accessory structure, costing more than $100.00 or exceeding 100 square feet in area …

He wanted to know if it’s possible that a zoning compliance permit wouldn’t be required if the $100 limit were not exceeded. Rampson said it’s hard to say, but she thought Kunselman’s conclusion was right – with the exception of a day-care facility. She suggested that people obtain a compliance permit in case someone calls to complain, but the city would not necessarily require one.

Outcome on Amendment: The amendment replacing specific language on home occupations with a code reference was unanimously approved.

Medical Marijuana Zoning: Amendment – 1000-foot Buffer

Carsten Hohnke (Ward 5) proposed amending the required buffer between dispensaries and cultivation facilities and schools from 1000 feet to 1010 feet. He said that round numbers are not necessarily any better. The 1% difference does a better job of accomplishing what they’re trying to accomplish, he contended. The intent is not to impact existing dispensaries – it’s to make sure they’re not cutting off parts of blocks.

At the request of Tony Derezinski (Ward 2), Hohnke asked Wendy Rampson, head of planning for the city, to explain. Hohnke confirmed with her that the extension of the buffer by 1% would in certain locations help to bring a complete block into the buffer zone. Rampson said there’s no magic number. Sabra Briere (Ward 1) asked Rampson if she’d drafted some maps depicting the 1010 buffer. No, Rampson said, the question came up after they’d looked at the issue. The city has a map showing the 1000-foot buffer. Briere asked by the next meeting to have maps with 1000, 1100 and 1250-foot buffers shown. She said she’s uncomfortable with a 10-foot change – she found that odd. She noted that Sandi Smith (Ward 1) had actually wanted to decrease the buffer.

At that point mayor John Hieftje asked city attorney Stephen Postema if the changes they’d undertaken to that point were substantive enough to require an additional reading before the council, if the council voted to approve the main motion. Postema said that many of the amendments are small enough, but the deletion of the prohibition on transfer, and tinkering with the 1000-foot buffer, could amount to substantive changes. The wiser course would be to have an additional reading, he advised.

Hieftje said he needed clearer advice. Postema suggested postponing to the council’s first meeting in June.

Weighing in on the buffer question, Smith said it doesn’t make sense to add 10 feet – there is already a limit on the number of dispensaries. She said she thought 500 feet is adequate, and 1000 feet is more than cautionary – so 1010 makes no sense.

Outcome: The council voted down the amendment changing the buffer to 1010 feet. Voting for it were Tony Derezinski, Stephen Rapundalo, Christopher Taylor, Carsten Hohnke, and Mike Anglin, which was one short of the six votes it needed.

Medical Marijuana Zoning: Motion to Postpone

A motion was made to postpone the zoning ordinance.

Christopher Taylor (Ward 3) elicited from city attorney Stephen Postema the view that it was a “close call” as to whether the council would need to give the zoning ordinance an additional approval, if council voted to approve the ordinance that night.

In light of the fact that possibly another reading before the council would be required, even after voting that night, Taylor said, “I’m all for voting.”

Alluding to the revised legislation that is marked up with color-coded revisions, mayor John Hieftje said he’s wanted for a long time to have something to read without colored print. He suggested trying to get a clean page before voting.

Final Outcome on Zoning: The council voted to postpone the zoning ordinance until June 6. Sandi Smith and Christopher Taylor dissented.

Medical Marijuana Licensing: Council Deliberations

Over the course of the council’s months-long consideration of medical marijuana licensing requirements, among the more significant revisions has been to exclude home occupations from licensing requirements. On Monday, several amendments were passed, but the most significant one excluded another major category from licensing requirements: cultivation facilities.

Medical Marijuana Licensing: Amendment – Insertions

Sabra Briere (Ward 1) led off with a set of changes that involved wholesale insertions of language. The amendment added “medical marijuana” before instances of “dispensary” or “cultivation facilities.” The amendment also inserted “registered qualifying” before instances of “patient” and inserted “registered primary” before instances of “caregiver.”

Outcome on Amendment: The council unanimously approved the insertion of the various phrases.

Medical Marijuana Licensing: Amendment – Completeness

The second amendment proposed by Sabra Briere (Ward 1) made clear that the link between the cap on licenses and applications is for complete applications. In amended form, that section of the ordinance reads:

The first year’s licenses shall be capped at a number 10% higher than the number of complete applications for licenses submitted to the City in the first 60 days, after the effective date of this chapter, but not more than 20 medical marijuana dispensary licenses shall be issued in the first year. Any license terminated during the license year returns to the City for possible reissuance.

Outcome on Amendment: The amendment specifying the completeness of applications was unanimously approved.

Medical Marijuana Licensing: Amendment – Cultivation Facilities

Sabra Briere (Ward 1) then proposed that references to “cultivation facilities” be removed. In arguing for the exclusion of cultivation facilities from licensing requirements, she said that according to the Michigan Medical Marijuana Act (MMLA), they are supposed to be cautious. She cited the relevant passage from the MMLA:

Possession of, or application for, a registry identification card shall not constitute probable cause or reasonable suspicion, nor shall it be used to support the search of the person or property of the person possessing or applying for the registry identification card, or otherwise subject the person or property of the person to inspection by any local, county or state governmental agency.

Briere said that passage tells her the city is not supposed to be looking at or keeping records or inspecting property of applicants for the state registry identification card. While dispensaries have decided to go public, she said, caregivers have not. She said she could not understand why the city sought to license caregivers.

Sandi Smith (Ward 1) said she wholeheartedly supported removal of cultivation facilities from licensing requirements. She felt it was inviting people to aggregate a large number of mature plants and register with the city, and it was an invitation for the DEA to come in.

Stephen Rapundalo (Ward 2) asked the city attorney Stephen Postema to weigh in. Postema said that in some ways, this is a policy decision for the council. He said he disagreed with Briere that there’s anything in the state law that prevents the city from having reasonable regulation.

Christopher Taylor (Ward 3) asked Wendy Rampson, head of planning for the city, how she saw the role and utility of having cultivation facilities in the licensing scheme. For the zoning regulations, cultivation facilities are included. Rampson said that cultivation facilities are different from home occupations. Home occupations are in someone’s own home, whereas cultivation facilities are a commercial operation. That’s why the city planning commission recommended specific zoning districts where it would be appropriate to have a cultivation facility, she said.

Taylor asked if the limit of 72 plants for cultivation facilities – now amended into the zoning regulations – would address the planning commission’s concern. Rampson allowed that the 72-plant limit would address some concerns. Based on the information staff had received, they were talking about quite large operations and they were concerned about that.

Rampson said there could still be an agglomeration of facilities in multiple tenant spaces. But mayor John Hieftje said that possibility had been eliminated. Taylor suggested that the concern of scale should disappear with the 72-plant limit.

Postema interjected concerns about not having a license on something that is a commercial facility. He contended that security concerns are the same, whether it’s large scale or small scale. Safety and security concerns are theoretically there whether the operation is large or small, he said. Safety and security is a hallmark of all licensing, he said.

Smith asked if a change in use for any building would set off an inspection process for city that would take care of risks associated with health and safety. Smith said security measures would be inherent in the product being grown.

Marcia Higgins (Ward 4) made the same observation she’d made in connection with the zoning deliberations: The only difference between a home occupation growing operation and a “cultivation facility” is that a cultivation facility is offsite from a residence. If the limit is 72 plants, she wondered, how can you have the medical marijuana co-ops, which already operate in the city? She asked if the passage of the 72-plant requirement and their exclusion from the licensing requirement would shut down the co-ops? Briere replied that she hoped so.

Taylor said he was confident in the strength of the 72-plant limit in the zoning regulations.

Without a licensing requirement, Stephen Kunselman (Ward 3) asked if there is a limit somewhere on number of cultivation facilities. [If cultivation facilities were required to be licensed, the cap on the number of licenses would provide that limit.] He noted there are a lot of property vacancies, and having grow operations could be a good way to pay the rent. He expressed concern that the community could be overrun with a lot of grow operations.

Briere said a problem with restricting the number of cultivation facilities is that there may be more than the city can see today. The city doesn’t want them to be large cultivation facilities, she said. The number of 10 as a limit was a number that was suitable, she said, when the council believed the city might have to deal with large grow facilities.

Kunselman replied that if the city doesn’t license cultivation facilities, they won’t know the facilities are there, and the grow operations will show up without signs. Briere responded by saying that if the city licenses cultivation facilities, it starts collecting information on caregivers, and that becomes available to the federal government. The state can protect its information, but it’s harder for local governments to protect it, she said. Smith said it would be excellent to charge the licensing board with examining the issue and bringing that as a recommendation after a year.

Stephen Rapundalo (Ward 2) asked Postema to weigh in. Postema said that initially when the council addressed the issue, aggregation was the concern. He suggested that another tool available to the council, separate from licensing, is another zoning tool: restrictions on how near to another facility a cultivation facility can be.

Kunselman pressed Briere to explain how gathering information on cultivation facilities was different from gathering information on dispensaries. Why don’t we treat them the same? Briere explained that deciding to grow away from your home doesn’t mean you want to grow it for the public. Maybe you want to do it because of children, or whatever personal reasons, or maybe there’s no space, she said. So by growing away from your home, you become a “cultivation facility” – even though you’re just an individual patient or caregiver. A cultivation facility is not a commercial activity only, even though it’s logical to assume that, she said.

On another level, Briere continued, they should think about whether the city is pushing people to grow marijuana as a home occupation. The more restrictions the city places on people growing marijuana away from their homes, she said, the more the city encourages growing in homes, thus in neighborhoods.

Some people are growing marijuana to make money, Briere said, and some are growing for a patient whom they love – and they’ll do that in a basement, closet, attic or warehouse. It’s difficult to decide if they should be paying a fee for a license. She said she didn’t have an answer and that’s why she had proposed the amendment.

Tony Derezinski (Ward 2) said the discussion was coming at a late date. He wanted a comprehensive ordinance, and part of that includes facilities for growing marijuana, he said. His reading of the statute is that you can have authority as a city to regulate – it’s a question of whether Ann Arbor wants to regulate in that way. His own sense is that it’s easier to be more restrictive, then if the regulation is not needed, it can be relaxed, he said.

Hieftje inquired of Briere if the motivation is to eliminate a layer of documentation – yes, said Briere, and to simplify the law. Carsten Hohnke (Ward 5) saw it also as also a matter of fairness to those who choose to grow not in their own home.

Outcome on Amendment: The council approved the amendment eliminating cultivation facilities from licensing requirements, with dissent from Tony Derezinski, Stephen Rapundalo and Marcia Higgins.

Medical Marijuana Licensing: Amendment – Strike “Federal”

The next amendment suggested by Briere was to strike the word “federal” as follows:

(5) The license requirement set forth in this chapter shall be in addition to, and not in lieu of, any other licensing and permitting requirements imposed by any other federal state or local law.

Outcome on Amendment: The amendment to strike “federal” was approved, with dissent from Stephen Rapundalo.

Medical Marijuana Licensing: Amendment – Council Approvals

The final amendment handled on Monday was again introduced by Sabra Briere (Ward 1) and included a motion to change the title of the licensing board to “Medical Marijuana Licensing Board” and to establish a procedure for approval or rejection of each license application by the city council.

Stephen Rapundalo (Ward 2) asked city attorney Stephen Postema for his thoughts. Postema said he had no issue with that.

Christopher Taylor (Ward 3) wondered if the instruction should be that the council had to act on each application, or if it should simply allow the council to act. Postema said the language means that a recommendation from the board must be given an up or down action. Mayor John Hieftje said he had a concern there, because the issue has already taken over large chunks of the council’s time. He wondered if there was any way they can limit it. Marcia Higgins (Ward 4) said she didn’t think she’d ever seen a recommendation coming from a board that says the council must act.

Briere offered to change the recommendations from the licensing board to the council to make them an annual event instead of an ongoing process. The council settled on an annual process, though Sandi Smith (Ward 1) expressed a preference for a quarterly process.

Outcome on Amendment: The council unanimously approved the amendment specifying how the council approves each license.

Medical Marijuana Licensing: Motion to Postpone

Sabra Briere (Ward 1) said she’d be happy to end the deliberations, but said she was nearly done with the major part. Mayor John Hieftje asked how much time she figured remaining amendments would take. Briere estimated 30 minutes. A motion was made to postpone the licensing ordinance in its form as amended.

Outcome on Licensing: The council voted unanimously to postpone consideration of the medical marijuana licensing ordinance until its June 6, 2011 meeting.

Human Services Allocations

Before the council was a resolution to allocate funding for nonprofits that provide human services in the city for fiscal year 2012, which begins July 1, 2011. The $1,159,029 in the resolution reflected a 9% reduction from FY 2011.

The city’s support for human services is allocated in coordination with additional funding from other agencies: United Way of Washtenaw County ($1,677,000), Washtenaw County ($1,015,000) and Washtenaw Urban County ($363,154).

Human Services Allocations: Budget Public Hearing

On Monday, the council held its public hearing on the fiscal year 2012 budget, which will be considered formally on May 16. Several of the speakers directly or indirectly addressed human services spending in that budget.

Thomas Partridge said the budget shouldn’t be passed without reviewing it for progressively-scaled fees. People have suffered too long under regressive taxes, he said, which had culminated in an effort to recall Gov. Rick Snyder. He reminded the council that the right to recall elected officers can be applied to local officials, as well. He called on the mayor and the council to live up to their responsibility to come up with a budget, tax and fee structure that is progressively-scaled to give consideration to the most vulnerable in society.

Susan McGarry introduced herself as the minister at St. Aidan’s Episcopal Church – she also serves on the Interfaith Council for Peace and Justice (ICPJ) working group on racial and economic justice. She urged the council not to make cuts to the community’s safety net. She said she’s been a professional minister for over 30 years. The church had started sheltering by letting people sleep in their basement. Since then so much has improved, she said. We have a community where we can be proud, she said. She argued against those who would say that “we make it too easy for poor people.” It’s a hard budget, but it’s difficult for the most vulnerable among us, she said. In a difficult time, we need to keep that good work going forward.

Lucia Heinold also introduced herself as a member of ICPJ. She said that Ann Arbor is a caring community. We need good fire protection, but we need to keep the poorest among us in our minds, she said. It does us no good to have a great park system if we have people who are too poor and sick to get to the parks. She thanked the council for all the work they had done. As treasurer of some organizations, she knows how hard it is to keep things running in the current economic climate.

Michael Appel with Avalon Housing supporters, who are holding more than 4,000 paper cranes to represent the number of people who have used Avalon's services.

Michael Appel, associate director of Avalon Housing, was joined at the podium with a supporting cast of people holding 4,738 paper cranes – one crane for every person that Avalon Housing had served in 2010 through its homelessness programs. The beauty of that many colors, he said, contrasted with the sheer number of people who had lost their housing. For over a year volunteers had been making the cranes to help visualize the scale of the problem. He reminded the council that they would be acting that night only on the human services part of the budget, but said that it was connected to the rest of the budget. People are not using public safety services, if they’re using Avalon’s services.

Ellen Schulmeister, director of the Shelter Association of Washtenaw County, described a client who had been helped through the association’s programs – a man named Charlie who, among other challenges, suffered from migraine headaches. He was falling through cracks in the system, and in late 2010 came to the Delonis Center, out of ideas. He entered the center’s residential program, she said, where a case manager helped him design a plan. The first step was to get his medical needs addressed. His case manager helped him apply for Social Security, which gave him a monthly income, and he was able to take the step of finding stable housing. He moved into that housing on Feb. 1.

Diana Neering, who is also with the Shelter Association, gave the council a second sketch of one of the association’s client success stories. It was the story of Matthew, who appeared at the shelter wearing boots and dark sunglasses. He had a mental disorder and would talk of owning 40 Internet businesses and being a friend of the University of Michigan president. Staff finally convinced him to give the shelter a try. He received mental health treatment through a prescription. His case manager had helped him apply for Social Security benefits and he was quickly approved. He now has income, health insurance, housing and treatment. “We didn’t give up on him,” she said. So she asked the council not to give up on the shelter.

Nicole Adelman, executive director of the Interfaith Hospitality Network of Washtenaw County at Alpha House, told the council that the city had supported human services funding for many years, and they should be proud of that. She asked the council to please not cut the budget this year. Ultimately, that money keeps people out of emergency rooms – it saves the community money, she said.

Joanne Motino Bailey, director of nurse midwifery service at the University of Michigan Health System, said she also worked with Planned Parenthood and has watched the funding be used to change women’s lives and provide the integrated care they need. She strongly encouraged the council to continue the funding.

Barbara Niess May, executive director of SafeHouse Center, noted that SafeHouse receives human services funding from the city. The long-term support that the city council has given to human services funding is part of what makes Ann Arbor a safe and pleasant place to live. She pointed out that the majority of funding that’s invested stays in the community and often leverages other resources. She said she’d be remiss not to thank the council for this gift, but said it’s also a necessary investment.

Pam Smith introduced the council to Child Care Network as a 33-year-old nonprofit that helps families find childcare. It had enjoyed 30 years of support from city of Ann Arbor. The nonprofit helps the most economically vulnerable, but they pay a portion of the child care – that helps keep parents involved. Clients have gone on to hold jobs as bank mangers and customer services representatives in the community, she said.

Also addressing the council for the Child Care Network was Lori Bush, director of family support programs. She told the council it’s difficult to get parents to come represent the nonprofit’s programs because they have time commitments, so she read a letter from one of their parents who is a client, who described how the nonprofit had helped her.

Julie Steiner, executive director of the Washtenaw Housing Alliance, encouraged the council to continue funding. She told the council that nonprofits don’t just stand before the city and ask it for money. She described starting a program for a “single point of entry” to save people’s energy. She described how the money allocated to WHA helps the organization bring additional money – leveraging the money it receives – $1.5 million had been obtained through the federal stimulus (AARA) for rapid rehousing.

Former councilmember Jean Carlberg said it was very nice to be in front of the council. When she’d left the city council, she went to the Washtenaw Housing Alliance, because she appreciated the fact that the alliance included 25 partners to work on homelessness. But she said her interest is more than homelessness. She noted that those who benefit from human services are not just clients, but also friends and neighbors.

Referring to the 4,000 paper cranes presented by Michael Appel and his group, Carlberg said that number would need to be multiplied by 5 to include people who are in crisis and near crisis. The issue concerns more than just people who receive services directly. She also pointed out that the money stays here and multiplies in the community. It’s a relatively small amount, she said. It’s a difficult choice, but she compared it to choosing between temporary inconveniences versus taking away a basic human need. There’s not a temporary consequence to that, she said. The city’s money would be well spent in the community.

Human Services Allocations: Council Deliberations

Mary Jo Callan, head of the joint city/county office of community development, described the human services funding levels this year compared to last year as a $116,000 reduction. The office as a whole had made a 7% reduction, even though the target was 2.5%. As Callan explained during a February 2011 working session, the previous year’s budget had assumed federal funds that did not, if fact, materialize. So they were “starting in a hole,” she said.

Mayor John Hieftje asked whether the 2.5% target was met, leaving the federal funds out of the equation. Callan confirmed that the federal funding is essentially the difference between the 7% reduction compared to the 2.5% target.

Referring to the coordinated funding approach to support nonprofits that provide human services, Sandi Smith (Ward 1) said that in Washtenaw County, we are doing something unique in aggregating funds. That approach really maximizes and leverages the available funding. She commended the work that had gotten the community this far. She asked Callan to comment on the coordinated funding model.

Foreground to background: Councilmembers Sandi Smith (Ward 1), Margie Teall (Ward 4), Marcia Higgins (Ward 4), and city attorney Stephen Postema.

Callan confirmed that her office uses a coordinated funding model that includes public entities – the city of Ann Arbor, Washtenaw County and Urban County – and the Washtenaw United Way. The idea is for these entities to examine how best to invest and amplify the effect of their funding. A review team representatives from each governing board helped evaluate the criteria set out for applicants beforehand. They’re funding a total of 63 nonprofit programs. The city of Ann Arbor funds aren’t directly supporting all of those 63, Callan said, but the availability of city funds allows decisions to be made about all of the nonprofits.

Smith asked Callan to illustrate how city dollars are leveraged by giving the ratio of dollars invested to dollars brought in. Callan told Smith that two years ago, a local dollar brought in $10 in additional support. That figure has now grown to $13, she said. The growth, she said, is due to a couple of factors. First, nonprofits are relying on being entrepreneurial and going after funds to support their core mission. Second, as the city allocates funding, it is now demanding “capacity” from those nonprofits, so the city is investing in nonprofits who know how to generate dollars.

Stephen Rapundalo (Ward 2), who was one of the architects of the scoring metric used to evaluate nonprofits that apply for city funds, asked Callan about Meals on Wheels. He said he fully supported its mission and they do great work. But the fact of the matter is that it’s a University of Michigan program. “Yet they come to us?” he asked. Surely UM can find that amount of money, he ventured. So he asked Callan why Meals on Wheels comes seeking city dollars.

Callan told Rapundalo that other people have asked that too. Callan said she did not have an answer that would be good enough for some folks – but Meals on Wheels uses local dollars to leverage money, too. Part of it is also a policy issue – the city has always funded some programs.  They’re a part of the portfolio. Callan told Rapundalo that she appreciated his acknowledgment that Meals on Wheels does really good work. Rapundalo replied to Callan’s remark – she told him it’s a legitimate question – by saying that’s why he brought it up.

Sabra Briere (Ward 1) said she’d like to postpone the resolution, because she was not prepared to vote that night. She held out hope that between now and the council’s next meeting, the city can find “an additional dime.”

Outcome: The council voted unanimously to postpone consideration of human services funding.

Packard Square

Before the council were resolutions to approve the site plan and development agreement, as well as the brownfield redevelopment plan, for the Packard Square project, which is located at the site of the former Georgetown Mall. The development would include 230 apartment units, 23,790 square feet of retail space, 454 parking spaces and stormwater detention facilities.

At its March 15 meeting, the Ann Arbor city planning commission had unanimously recommended approval of the Packard Square site plan. [Chronicle coverage: "Packard Square, Fraternity Site Plan OK'd"]

The total investment by the developer for this project is about $48.2 million. The amount of that which falls under the brownfield plan’s eligible activities is $2.82 million – for site preparation, demolition, footing drain disconnects and sanitary sewer upgrades, and remediation of contaminants from the former dry cleaning business on that site.

Packard Square: Public Hearing

Mary Krasan thanked Margie Teall (Ward 4)and city planner Jeff Kahan for their time and effort in expediting a solution to the Georgetown Mall situation. The Packard Square project is not perfect, she said, but she hopes it will be a beneficial one to the neighborhood’s quality of life. The neighborhood has been lucky – it’s looking at an end to that particular blight, when other neighborhoods have no certain end in sight. Neighborhoods need protection against the impact of blight on property values and on morale, she said.

Jeanne Horvath told the council that her property abuts the old Georgetown Mall site. She described the proposed project as not the best, but better than what they have now.

Thomas Partridge introduced himself as a Democratic Party leader calling on council to pass amendments to the development agreement, saying the council needed to table it for this agenda. The amendments should ensure access for the most vulnerable – students, adults and families. There needs to be adequate access to the development, he said.

Packard Square: Council Deliberations

Marcia Higgins (Ward 4) reported that the city’s brownfield committee had met several times looking at the request. [The project is located in Ward 4.] She explained that the soil contaminants [tetrachloroethylene] will be removed to a concentration meeting a 10(-5) standard instead the more stringent 10(-6) standard. The reason for that, she said, is that a vapor barrier would be installed, at the request of the Michigan Dept. of Environmental Quality. The brownfield committee will be bringing a resolution before the council to ask the city’s environmental commission to review brownfield plan policies and to update them to add precautionary measures that were not available 10 years ago.

Margie Teall (Ward 4) said she’s delighted the site plan was in front of the council. She said the residents are excited about it. Higgins echoed Teall’s comments – it’s not often that near neighbors say they really want the council to move forward on a project. It’s become a real community dialogue, she said. Teall added that it’s been a dialogue between developer and residents.

Outcomes: On separate votes, the council unanimously approved the site plan, development agreement and brownfield plan for Packard Square.

Sakti3 Abatement

Before the council was a resolution to set a public hearing on the granting of a tax abatement to Sakti3, a University of Michigan battery technology spinoff from the University of Michigan. Sakti3 is led by UM professor Ann Marie Sastry. The public hearing will be held as part of the city council’s June 6, 2011 meeting, which starts at 7 p.m.

Sakti3 is requesting an abatement on $200,000 of real property improvements (electrical construction work) and $2.2 million of personal property (battery cycling equipment, thermal chambers, machine shop equipment, server system).

If granted, the abatement would reduce the annual tax bill on the new improvements by about $17,000 for each year of the abatement. According to city staff, the new real and personal property investments would generate about $22,500 in property taxes each year.

At their March 21 meeting, the council voted to set a public hearing on the establishment of the industrial development district under which Sakti3 is applying for an abatement. And on April 4, the city council approved the establishment of the district.

Outcome: The council voted unanimously without comment to set the public hearing date for the Sakti3 tax abatement.

Municipal Center Construction

The city’s new municipal center, located on the west side of city hall (the Larcom Building) has its main entrance off Huron Street. The street address for city hall is now 301 E. Huron.

Municipal Center Construction: City Administrator Update

During his communications time, interim city administrator Tom Crawford gave the council an update on renovations that are being done on the Larcom building.

In the basement, the area that had flooded due to a burst pipe dried well and there’s no mold, he said. Radon levels are below the action level for residential construction, he said. On the first floor the sprinkler piping is finished – drywall installation and asbestos abatement continue. Two elevators in the west tower are complete and have passed inspection. The old elevators are permanently out of service.

Municipal Center Construction: Wheeler Contract Extension

Before the council was a contract extension with William Wheeler for oversight of the municipal center construction project. In March 2010, the council had voted to continue Wheeler’s services as the municipal center project manager – Wheeler is a former city of Ann Arbor employee.

The contract language stipulated that it would expire when Wheeler hit a maximum compensation of $126,000 or by April 30, 2011. The council approved a contract extension of 60 days, with no increase in the cap on total compensation.

Outcome: The council voted unanimously without comment to approve the contract extension for William Wheeler.

Interagency Technology Agreements

The council was asked to consider the approval of several interagency agreements on the use of technology with: (1) Washtenaw County and the Ann Arbor Transportation Authority; (2) Washtenaw County for data storage services; and (3) Washtenaw County for backup services.

The AATA board had discussed the collaboration at its April 21 meeting. The data storage services to be provided by the county will cost $73,632 for four years. The backup services to be provided by the county will entail an annual service cost of $102,607 for four years.

Marcia Higgins (Ward 4) is not getting a tutorial on how to pack a snowball. As interim city administrator Tom Crawford noted during his communications – it's spring.

Tom Crawford, the city’s CFO and interim city administrator, noted that the state looks at this kind of collaboration favorably. Marcia Higgins (Ward 4) asked whether the city’s recent arrangement to provide the city of Chelsea with IT services would count as collaboration from the state’s point of view – yes, said Crawford, if Ann Arbor gets to count things it’s already started.

Dan Rainey, head of IT for the city, explained the nature of the shared storage and shared backup – there will be one machine at city hall and one at the city’s Wheeler Center. Mayor John Hieftje said some people might question the cost. What would happen if the city didn’t spend the money, he asked. Rainey said the city would be at significant risk of not being able to recover data. That might mean the loss of critical data like maps, financial data, data on the wastewater plant, and day-to-day operations. It’s really important to have a means to back up and recover it, Rainey said.

Sabra Briere (Ward 1) noted there are some people who think the city spends way too much money on IT. She asked Rainey to describe how much of the city’s IT operations are handled by his department. He explained that his department operates across the entire organization – 98% of all the city’s IT costs are in the IT department’s budget. Briere concluded that this reflects a change in the way the city government does business.

In response to a question from Hieftje, Rainey said that IT costs have remained relatively flat over the last three years. Sandi Smith (Ward 1) asked if the city would eventually move to cloud-based technology. Rainey explained that several of the applications used by the city are already cloud-based: including HR, payroll, and law enforcement and courts system software. He also said the city is shrinking its physical footprint by converting paper documents to digital form.

Outcome: The council unanimously approved the three interagency IT agreements on its agenda.

Street Closings

On its agenda were approvals of several street closings. Christopher Taylor (Ward 3) asked his colleagues to excuse him from voting on one of them. Grizzly Peak, which was requesting a closing of Washington Street in connection with a Sept. 16-17, 2011 Oktoberfest celebration, is a client of  the law firm Butzel Long, where Taylor works.

Other street closing requests were for: 1) the Ready Set Fly 5K on Saturday, May 21 from 8:45 A.M. to 11:00 A.M., and 2) The Event on Main, a fundraiser for the University of Michigan C.S. Mott Children’s and Women’s Hospital, on South Main Street between William and Liberty, from 6 a.m. on Thursday, June 23 to 2 a.m. on Friday, June 24.

Outcome: The council voted unanimously to approve all the street closing requests.

DTE Power Line Relocation

On the council’s agenda was the finalization of an agreement with DTE to relocate power lines in connection with the East Stadium Bridges reconstruction project. Sabra Briere (Ward 1) asked Sue McCormick, public services area administrator, if the lines would be buried. The answer – yes – was provided by Homayoon Pirooz, head of project management for the city, who stayed until the end of the meeting, along with city engineer Michael Nearing.

Outcome: The council voted unanimously to approve the agreement with DTE.

Large Vehicle Purchases

The council was also asked for authorizations to purchase two large vehicles – an Elgin street sweeper and a combination sewer truck – and a large piece of truck-mounted equipment (a rodder for clearing out sewer lines).

Higgins said she felt like the ghost of Chris Easthope was sitting in her seat – she had questions about whether the purchases were necessary. [After the meeting, she told the Chronicle that former councilmember Easthope had on occasion questioned the purchase of some large vehicles when staff had recommended acquiring them – if a truck had limited miles on it, then the age of the vehicle wouldn't necessarily justify its replacement.]

After confirming with Sue McCormick, public services area administrator, that the staff did not need the council to act urgently, Higgins moved to postpone the sewer truck purchase. Sandi Smith (Ward 1) later moved postponement of the street sweeper.

Outcome: Votes on the two vehicles were unanimously postponed, but the rodder was approved at a cost of $87,500.

AATA Appointments

Before the council were two nominations that had been made at the council’s previous meeting to reappoint Charles Griffith and Rich Robben to the board of the Ann Arbor Transportation Authority.

Outcome: Griffith and Robben were unanimously confirmed as members of the AATA board.

Work Session Minutes

Before the council voted on approval of various sets of minutes from prior meetings, Stephen Kunselman (Ward 3) inquired why the March 14, 2011 work session did not include councilmember attendance. He was assured that the record of attendance would be added.

Outcome: The council voted unanimously to approve minutes from previous meetings.

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: Taxicab Rate Increase – Public Hearing

As a part of his interim city administrator’s report, Tom Crawford noted that the city’s taxicab board is recommending a rate increase. At the council’s May 16 meeting, a public hearing will be held and the recommendation will be considered. The rate increase would affect only the mileage component of fares, which were last approved on May 19, 2008. The mileage increase from $2.25/mile to $2.50/mile had been requested by several taxicab companies in light of rising fuel prices. The taxicab board has indicated with this increase, it does not anticipate considering another rate change until the gas prices were over $5/gallon for at least two consecutive months.

Comm/Comm: Downtown Development Authority

Christopher Taylor (Ward 3) reported that there was some “confusion” but then rejected that as “too strong a word” and settled on “a couple of different interpretations” of the city ordinance governing TIF (tax increment finance) capture for the Ann Arbor Downtown Development Authority district, which will be need to be worked out. That’s why a resolution had been struck from the council’s agenda – it would have allowed the council to ratify a new contract under which the DDA would continue to manage the parking system.

Taylor said that Tom Crawford, the city’s CFO and interim city administrator, was involved in working out the issue along with city attorney Stephen Postema. There may be a larger explanation at the council’s working session on May 9, he said. [Without ratifying a new contract, the city would receive about $2 million less in parking revenues than it has planned as part of its 2012 fiscal year budget. Chronicle coverage: "DDA Delays Parking Vote Amid TIF Questions"]

Comm/Comm: Park Advisory Commission – Budget

Christopher Taylor (Ward 3) reported on a conversation held at the most recent meeting of the parks advisory commission (PAC). Taylor is one of two ex-officio representatives of the city council to that body – the other is Mike Anglin (Ward 5). Taylor said that PAC had reviewed the FY 2012 budget and new fee schedule. PAC members had discussed cuts in the parks department, which are divided across two units – community services and public services. [Chronicle coverage: "Council to Get Reminder of Parks Promise"]

The cuts on the public services side are, as currently proposed, in excess of the cuts compared to other units. He said PAC had been told by Matt Warba, field services supervisor with the city, that the services to be provided will not be cut, but rather that the costs have gone down, because of greater efficiencies. The services will be consistent year over year, said Taylor. In addition to increased efficiencies, the proposed parks budget involves the shifting of cost burdens, for example, to money provided by the METRO Act. PAC passed a resolution exhorting city council to re-fund the public services budget.

Anglin added that PAC had discussed the gradual funding reduction to parks over the years. As the parks maintenance and capital improvements millage will again be before the voters for renewal in 2012, it’s important to have the policies for administration of that millage in place, he said.

Anglin said he doesn’t like to use the word “asset” in reference to parks, because it leads to treating the parks like a business. He reported that he’d talked to young people in their 30s, about how they’d taken advantage of some nice recent weather – they’d taken long bike rides and hung out in the parks. This is what we want to protect, Anglin said. He wants to look at policies for administration of the millage before it’s placed on the ballot next year and he wants to keep the parks whole, if possible.

During the budget public hearing, Julie Grand – chair of the city’s park advisory commission – told the council that she and Sam Offen, chair of PAC’s budget and finance committee, were there to talk about the two resolutions passed at PAC’s last meeting. The first one recommends that the council adopt the proposed budget, she said. The second one raises a couple of considerable concerns. The first concern is the cuts themselves and the second relates to the timing. The cuts would require change to the city’s administrative policy on parks funding allocations, she said. Given the fact that the millage will be up for renewal next year, the perception is that the millage will simply substitute for general fund support of parks.

Offen reiterated and supported the points made by Grand about park operations. The finance committee had talked with Colin Smith, the city’s parks and recreation manager, about parks and recreation. The conversation had been well-planned, with plenty of notice and information. Offen commended Smith and Sumedh Bahhl, who heads all of community services, for their hard work, communication skills, and ability to provide a clear message to PAC. Offen said that the community is lucky to have people like that working for the city.

But Offen expressed concerned about the park operations side of the budget. PAC had had very little time to digest it. Offen said that PAC had significant questions about the lasting ability of state funds [like the METRO fund] to support it, and the fact that the proposed FY 2012 budget doesn’t adhere to the 2006 administrative policy on general fund support for parks. That policy had been a controversial issue at that time, Offen pointed out.

No one spoke during a public hearing on fee adjustments in the community services area, which included rate increases and new fees for new activities in the city park system. [.pdf of recommended fee increases]

Comm/Comm: Labor Negotiations – Fire-Related Deaths

Stephen Rapundalo (Ward 2), noting the budget-related theme of some of the council communications, said it’s useful to remind people that the budget that former city administrator Roger Fraser had proposed before leaving the city ties a labor strategy to the budget: A certain number of planned layoffs in police and fire protection could be mitigated through union concessions.

If police officers adopted the same health care plan as non-union employees, then at least four full-time police officers would not need to be laid off. And if firefighters adopted the same health care plan as non-union workers, that would be sufficient to pay for more than two full-time firefighters, Rapundalo said. There is still time before deliberations at the council’s next meeting on May 16 to make those concessions. He said there’d been speculation that the council won’t follow though on plans to cut public safety workers. But Rapundalo said the budget is very challenging and there’s no place else to get those savings.

Mayor John Hieftje supported Rapundalo’s contention that the council was prepared to follow through on the cuts. A year ago, he said, Margie Teall (Ward 4) was able to make a statement that they had been able to find some additional funding, but there would not be that kind of comment this year. No year has been as tough as this one, Hieftje said – cities across the state have run out of strategies.

Matt Schroeder, president of Ann Arbor's Local 693 of the International Association of Firefighters, waits with others for his turn to speak during the budget public hearing.

During the public hearing on the budget, Matt Schroeder, president of Ann Arbor Local 693 of the International Association of Firefighters, addressed the council. He told the council that top city administrators had contended recently that the fire department’s initial response times probably won’t be affected by more cuts. In the last decade, he said, the city has eliminated 37 firefighter positions, closed one station and eliminated two trucks – average response time has risen, he said. The situation continues to worsen with rotating closures of stations, he warned. Fires are 2-3 times faster and hotter today, he said.

Schroeder said it’d been suggested that Huron Valley Ambulance (HVA) could handle the medical runs, and that the only reason the fire department responds is due to union protocols. In fact, Schroeder said, firefighters respond to medical runs because they’re trained for that and licensed by the state of Michigan. Citizens are not benefited by police officers going to those calls, he said, who are not licensed. The city and HVA determine together which calls firefighters go on – lives can be saved with firefighters responding to EMS runs. In just the last week, there were two occasions when firefighters had arrived well before HVA, and they were able to use basic life support skills to render assistance to two citizens, he said.

Schroeder then turned to statistics on deaths due to fire in Ann Arbor. From 1991-2005, he said, three people were killed in fires – that’s an average of 0.2 lives per year. Since 2006, 12 people have been killed in fires – 2 lives per year. That’s a 1,000% increase in lives lost during a period where there was a 29% staff reduction.

It’s been stated that the city is “comfortable” with more cuts, Schroeder said. He wondered if the city was comfortable with the fact that citizens needed to jump from balconies and roofs while they waited for enough firefighters [4] to arrive on the scene to enter a building to extract victims.

The International City/County Management Association (ICMA) study currently commissioned by the city targets first-arriving fire department companies only, Schroeder said. It does not look at second, third, and fourth arriving companies. He said that firefighters are being vilified – they’re doing more with less. The local union does believe it can work together with the city, he said. Schroeder drew a round of applause from the audience when he concluded his remarks.

Susan McGarry, who addressed the council in support of human services funding during the same public hearing, noted that she was in a car accident and had been very well served by the fire department on that occasion.

Comm/Comm: Elections

Larry Kestenbaum told the council he was pleased to see them. He introduced himself as the Washtenaw County clerk, noting that he is also co-chair of the Michigan Association of County Clerk’s legislative committee. He noted that the next day was election day. In Ann Arbor, there was just one issue on the ballot: the WISD special education millage renewal.

Washtenaw County clerk Larry Kestenbaum glances through his notes before addressing the council on the subject of elections.

Because it’s a single-issue stand-alone election with one item on the ballot and the city no longer has a daily paper, it’s pretty much a given that there’ll be low turnout, Kestenbaum said. Back in 2005 the number of elections started to be consolidated with a limit of four elections per year – in February, May, August and November. Since then, a lot of elections have been pushed to November, Kestenbaum said. [For example, the Ann Arbor Public Schools board of trustees election shifted from May to November, and the Ann Arbor District Library had to follow suit. Chronicle coverage: "School Election Change Would Affect Library" and "Ann Arbor Library Board Moves Elections"].

The state legislature is now considering a bill to force all school board elections to take place in November, Kestenbaum said. [.pdf of legislative analysis of House Bills 4005 and 4006 introduced by Kurt Heise, District 20]

He said there is also a proposal to change to just two elections per year – in May and November. That means that primarie would be in May, when more people have the opportunity to participate, not in the middle of the summer, in August. For most cities, the primary is the election, Kestenbaum said, so the increased opportunity for participation in the primary is important.

Thomas Partridge announced that he was there to speak on very important issues in the history of America. It was the eve of an important special education millage renewal. It’s vitally important that people show up at the polls, he said. He encouraged people to find their polling places – sometimes they’re assigned alternate locations.

Partridge also said it was important for everyone to take cognizance of the effort to recall Gov. Rick Snyder. He noted that the petition language had been the subject of a clarity hearing on April 29, and the election board had voted to find that the language was clear. The recall effort criticizes Gov. Snyder for turning his back on the most vulnerable residents like seniors and disabled people, public employees including school teachers, he said.

Comm/Comm: Economic Development

Stephen Rapundalo (Ward 2), as chair of the local development finance authority (LDFA), introduced Paul Krutko as the new CEO of Ann Arbor SPARK. He’d been selected after a national search. Krutko told councilmembers that he will give them a report on SPARK at their work session on May 9. Standing before the council, he said, is like being at home. Having spent 30 years working in economic development in cities like Cleveland, Jacksonville and San Jose, he is familiar with the city-manager form of government, he said.

Paul Krutko, CEO of Ann Arbor SPARK, approaches the podium to address the city council.

Krutko characterized Ann Arbor as a great community with great potential on the national and world stage. He said he can attest that companies can start in an incubator and become a major player on the world stage.

He said there is an excellent team at SPARK, which is a blessing and curse. When Michael Finney was tapped to lead the Michigan Economic Development Corp. by newly-elected Gov. Rick Snyder, he had taken key staffers with him to the state, Krutko said. So there are a number of key positions to fill at SPARK. That day was his 11th day on the job, he said. He concluded by thanking the councilmembers for the opportunity to appear before them.

Comm/Comm: Planning Commission Retreat

Tony Derezinski (Ward 2) is the city council’s representative to the city planning commission. He reported on the commission’s retreat on April 26, which had a theme of a regional approach to planning. The idea is to coordinate with other communities. At the retreat, the commission had focused on Washtenaw Avenue, the area’s busiest corridor. Commissioners had done a “community crawl” using an Ann Arbor Transportation Authority bus for the afternoon.

The bus stopped along the way at various points: across from Whole Foods; Arborland; and Glencoe Hills. At Glencoe Hills, the commission visited with Albert Berriz, CEO of McKinley, which owns that property. They also heard from Mandy Grewal, supervisor of Pittsfield Township, and Ypsilanti Township supervisor Brenda Stumbo, and a city of Ypsilanti planner. Derezinski called the corridor a good possibility for urban collaboration. The planning commission took a positive step in hearing what other communities thought, he concluded.

Comm/Comm: Wet Meadow – Buhr Park

Jeannine Palms was on hand to receive a mayoral proclamation honoring her work and those of several other volunteers in connection with the Buhr Park Wet Meadow Project. In her remarks, Palms traced the effort to establish the three wet meadows back to 1996. The plantings help protect Mallets Creek. She noted the educational aspect of the project.

Tony Derezinski (Ward 2) and county commissioner Yousef Rabhi chat before the start of the meeting.

Andy Brush, the webmaster for Washtenaw County, said he’d been volunteering with the project since he met Jeannine when a bulldozer was out working to sculpt the wet meadow. He thanked several people, including Amy Kuras (city parks planner), Jeff Dehring (former city parks planner who’s now with the county), Jason Frenzel (former Ann Arbor natural areas preservation volunteer coordinator, who’s now with the Huron River Watershed Council); Janis Bobrin (the county water resources commissioner), and all the members of the community who volunteered for the project.

Brush’s daughter Clare also addressed the council, telling them that she’d started volunteering with the wet meadow when she was three years old, still in preschool. Sophia Werthmann also dated her involvement to the age of three.

Also tracing his history with the project to his youth was current Washtenaw County commissioner Yousef Rabhi. The project meant a lot to him on a personal level, he said – it had shaped his University of Michigan degree. It had inspired him to run for public office. He took the opportunity to make a “shameless plug” for people to show up to the May 15 planting day – it goes from 10 a.m. to 4 p.m. at Buhr Park.

Comm/Comm: Wet Sanitary Sewer

Interim city administrator Tom Crawford, who is the city’s chief financial officer, spoke about the city’s sanitary sewer system. Due to the wet spring, local soils are now saturated, so any additional rain that falls becomes runoff. During the last week of April, from 7 a.m. Wednesday to 7 a.m. Thursday, he said, two inches of rain fell, and that runoff flowed into the Huron River.

During a three-hour period on April 28, the river peaked above flood stage, he said. [USGS flow rates for Huron River]. That morning, many trunk sewers were surcharged, running “more than full.” The system stands a risk of overflowing with additional rain. A few weeks of little or no rain will be required to dry the system out.

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

Next council meeting: May 16, 2011 at 7 p.m. in the second-floor council chambers at 301 E. Huron. [confirm date]

The medical marijuana zoning ordinance received its initial approval by the council at its Oct. 18, 2010 meeting. The delay since the initial Oct. 18, 2010 zoning vote stems from the city of Ann Arbor’s strategy in legislating zoning and licensing of medical marijuana businesses – that strategy has been to bring both licensing and zoning before the city council at the same time for a final vote.

The context for development of zoning regulations was set at the council’s Aug. 5, 2010 meeting, when councilmembers voted to impose a moratorium on the use of property in the city for medical marijuana dispensaries or cultivation facilities. The council also directed the city’s planning commission to develop zoning regulations for medical marijuana businesses.

Subsequently, the city attorney’s office also began working on a licensing system. The council undertook several amendments to the licensing proposal at four of its meetings over the last three months: on Jan. 3, Feb. 7,  March 7 and March 21. The council finally gave its first initial approval to the licensing proposal at its March 21 meeting.

At the May 2 meeting, the most significant amendment to the licensing proposal was to eliminate cultivation facilities from licensing requirements. [.pdf of Michigan Medical Marijuana Act]

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]