Len Nadolski, left, talks with city councilmember Tony Derezinski before the start of the May 1, 2012 Ann Arbor planning commission meeting. Nadolski owns the Chalmers Place Retail Center on Washtenaw Avenue and hopes to add a parking lot behind the center. The proposal was rejected by the planning commission, on which Derezinski serves. (Photos by the writer.)

About half of those speakers came out to oppose a parking project for the Chalmers Place Retail Center on Washtenaw Avenue, located next to Paesano restaurant in the former Arbor Dodge lot. The owner – Len Nadolski of Howell – asked to rezone a vacant parcel behind the center to P (parking), from its current single-family residential zoning. He said the center has been unable to lease all of its stores because tenants are concerned about a lack of parking.

Commissioners expressed sympathy for the owner, but voted against recommending the rezoning. The majority of commissioners did not feel that the situation warranted overriding the master plan, which calls for that property to be zoned residential. Erica Briggs said the situation added urgency to plans to make the Washtenaw Avenue corridor more safe and amenable to walking and biking.

Eric Mahler cast the lone vote in favor of rezoning. He said he normally wouldn’t support a proposal that was essentially “spot zoning,” but in this case he voted for the plan because he didn’t see any viable alternatives for the owner.

Another project that drew public commentary had previously been recommended for approval by the commission: Maple Cove Apartments & Village development, located on North Maple near Miller Road. The commission had approved the project at its March 20, 2012 meeting. But that vote was rescinded when it was discovered that Scio Township residents on Calvin Street had not been included in an original public notice mailed out for the commission’s March meeting.

Nearby residents voiced several concerns about the project – including density, flooding, aesthetics, traffic and a lack of sidewalks from North Maple back to the seven houses. Those issues were echoed by some of the commissioners, who also complained about the lack of responsiveness from the property owner, Muayad Kasham of Dynasty Enterprises. He has not attended the commission’s meetings to address concerns.

But it was the two proposed entrances off of North Maple – separate entrances for the apartments and the single-family homes – that prompted the most discussion among commissioners, and ultimately the move to postpone. Wendy Woods pointed out that the city’s traffic engineer had advised that a single entrance would be preferable. The city code allows for two entrances, however, based on the property’s lineal frontage. The owner has indicated a commitment to two entrances in order to market the apartments and single-family homes separately, and the city code allows for two entrances based on the property’s lineal frontage.

No date has been set for when the project will next appear on the planning commission agenda.

The commission also approved the city’s 2013-2018 capital improvements plan (CIP), with only minor modifications from the previous year. But commissioners voted to postpone action on a master plan update – they’re expected to discuss it at a retreat set for Tuesday, May 29.

The final item of the meeting was dispatched quickly, as commissioners recommended rejecting a proposed revision to the city’s medical marijuana zoning ordinance. The proposal – recommended by the medical marijuana licensing board – was to strike one sentence from the zoning ordinance: “Medical marijuana dispensaries and medical marijuana cultivation facilities shall be operated in compliance with the MMMA (Michigan Medical Marijuana Act).” Commissioners expressed caution about the implications of eliminating the sentence, with Mahler stating that the change would authorize illegal uses, and would have severe consequences for the city.

Maple Cove Apartments & Village

The planning commission rescinded its previous action regarding a site plan for the Maple Cove Apartments & Village development and reconsidered the proposal at its May 1 meeting.

The commission had previously approved the project at its March 20, 2012 meeting. But that vote was rescinded because Scio Township residents on Calvin Street had not been included in an original public notice mailed out for the commission’s March meeting. There were no changes to the plan in the interim period.

The project is located on 2.96 acres at 1649 N. Maple, north of Miller Road between North Maple and Calvin Street on the city’s west side. At the March 20 meeting, Bonnie Bona and Eric Mahler had voted against the project. Bona was absent from the May 1 meeting.

Project area for Maple Cove is showed outlined in black. (Image links to higher resolution .pdf file)

The plan calls for combining two sites – 1649 N. Maple and 1718 Calvin – and demolishing an existing single-family home and detached garages there. Two 3-story apartment buildings would be built with a 64-space parking lot and eight bike spaces. The project also includes building a private street to serve seven new single-family houses near Calvin Street, but with an entrance off of North Maple. According to a staff memo, there will be no access to Calvin Street, which “is a private street with a checkered history regarding access rights.” The apartment complex would have a separate entrance, also off of North Maple.

Each apartment building would contain a total of 18 one-and two-bedroom apartments ranging from 745 to 1,057 square feet. The plan calls for each apartment building to have a rooftop patio for use by residents, with the possibility of a vegetated cover (green roof) for the remainder of the roof surface. The staff memo noted that the city has requested a $26,660 parks contribution, but the developer has declined to make that contribution.

The site has two zoning designations, which the project accommodates. The eastern half of the parcel, adjacent to North Maple, is zoned O (office), but residential uses are permitted as long as the project conforms to the area, height and placement regulations of office zoning. The maximum height allowed is 55 feet, and the proposed apartment buildings would be 44 feet tall. The western half of the site, where the single-family homes are planned, is zoned R1C (single-family residential).

Site plans for two previous projects had been approved by the city (in 2005 and 2008) but neither project was built. Planning staff had recommended approval of this current project.

Maple Cove Apartments & Village: Public Hearing

Several neighbors attended the May 1 meeting and six people spoke against the project for a variety of reasons, including density, flooding, aesthetics and traffic.

Alice Boss told commissioners that she lives on Calvin, directly across the street from the proposed development – she’s lived there 10 years. This is the second time that she’s come to the commission for a project that’s been proposed for the land, which she described as beautiful green space. It’s a flood zone that’s used by migratory birds, and she’s concerned about what would happen to those birds. The existing homes along Calvin are small, she said, and the larger homes proposed for Maple Cove would be incongruous with the neighborhood. In general, she’s concerned about over-density, noise, light, and crime. The development would substantially degrade her quality of life, she concluded.

Carole Starnes said her property abuts the part of the Maple Cove project that’s next to Calvin. She’s concerned about the density of the apartments, but said she’s more familiar with the situation on Calvin. The soil in that area is clay, and there’s always water – she doesn’t want to see more flooding. What guarantees do they have that the problem won’t worsen? She noted that most homes in that area are built on lots that are more than one acre, but the seven Maple Cove homes will all be built on less than two acres total. She was concerned about density. Will there be any buffer between the development’s back yards and existing homes – and is there any guarantee about it, or will it be left up to the developer? Starnes said she’d hate to be looking out her living room window and see a house right there. Most people who live in that area now chose the location because of its rural character, she said.

Cheryl Brown criticized the commission and planning staff, saying “shame on you” for not initially notifying all neighbors about the project and for infringing on their right to due process. She pointed out that Calvin is a private street, so people would need permission to use it as an entrance or exit. [There are no plans by the developer to connect the project to Calvin.] She said she’d prefer some type of fence between the existing homes and the development, and she wondered where the property’s easement was located. It seemed like it was all take and no give by the developer – she didn’t see that the developer was willing to do anything in exchange for the project. Brown suggested that instead of building one of the houses, a park could be added.

Pete Miller said he’s lived on Calvin Street for 25 years, and the sump pump in his basement runs continuously. There’s a huge water problem in the area, and when the developer starts digging, even more problems will be caused, he said. It scared him to know that the county is responsible for drainage in that area, because the county hasn’t done anything to address the problem in years, he said.

Some of the residents who spoke during public commentary against the Maple Cove development on Ann Arbor's west side.

Stephanie Raupp reminded commissioners that she had spoken at the project’s public hearing in March – she had been the only person representing neighbors at that hearing. She’s a homeowner who lives directly across North Maple from the proposed development, on Enclave Lane, and had presented a petition on behalf of other residents who were concerned about the apartments. Based on feedback at this meeting, though, she said it seems like people are concerned about the apartments and the houses.

The main issue is that it feels like a bait and switch, Raupp said. When the property was rezoned based on a previous proposal by a different developer, that project had been significantly different than the one that’s now proposed, she said. It had been mostly offices, with a lot of green space and just a few loft apartments. The rezoning was approved based on that plan, but the current plan is nothing like that. She pointed out that many homes in the area have families with children who attend Skyline High, but the developer refuses to put in sidewalks. He at least owes the neighborhood sidewalks and more green space, she said. The parking lot is huge, and water runoff is a problem. The project needs to be reexamined, she said.

Brian Biggs was the last speaker, and said he lived on Woodrow Street near Calvin. He urged commissioners to go out to North Maple in the morning between 6:45-8:45 a.m. and then tell him how that road would accommodate 100 more cars. There are already backups at the roundabouts north of the proposed development, he said – where are the extra cars going to go? Kids have to cross North Maple to get to Skyline High or the elementary schools, he noted. Biggs also told commissioners that the soil on the property, where a salvage yard was previously located, is still contaminated. The developer wants to make a buck, he said, but “we need to think past the dollar.”

Maple Cove: Commission Discussion

Commissioners spent about an hour discussing the Maple Cove project. This report organizes the discussion thematically.

Maple Cove: Commission Discussion – Site Contamination

Jamie Gorenflo with Midwestern Consulting was the only representative of the developer at the meeting. He said a phase 1 environmental assessment had been completed, and that remediation was done on the site – it’s been cleaned up, he said. This prompted several people from the audience to shout “No way!”

Wendy Woods observed that the neighbors seem to think the site hasn’t been cleaned up. She asked Gorenflo for more details. He replied that a phase 1 and phase 2 environmental study had been done as part of a requirement in the sale of the property to the current owner. However, he said he hadn’t been privy to the recommendations from those studies. Woods said that concerned her.

Kirk Westphal asked whether the city could get a copy of the environmental study results. City planner Matt Kowalski said he wasn’t sure if the information was confidential, but he would ask for it. Is it required by the city? Westphal asked. Planning manager Wendy Rampson said the only time the city requires that kind of information is if the developer is seeking brownfield status. Otherwise, it’s handled at the county or state level. The city has no regulatory authority, she said. The private sector typically deals with this kind of issue prior to a property sale, to determine who has responsibility in case there’s any litigation.

Westphal asked who the neighbors could contact for more information. Rampson pointed to the Michigan Dept. of Environmental Quality (MDEQ), and said the planning staff would also follow up with the developer.

Maple Cove: Commission Discussion – Drainage, Flooding

Queried by commissioners, city planner Matt Kowalski confirmed that the project’s site plan must manage water on-site, and not allow runoff. He said the city staff and county water resources commissioner have reviewed the plan and given it preliminary approval. Excess water would be directed to an underground detention basin.

In response to a question from Evan Pratt, Jamie Gorenflo with Midwestern Consulting indicated that there’s no problem anticipated with groundwater. Pratt said it sounds like the site is wet, but that the project won’t make things worse. He noted that if there’s water on the surface, that usually means there’s water underground. It’s never a good idea to put basements in an area where there’s groundwater – you’ll end up with sump pumps that run continuously, he said.

Responding to another question, Gorenflo said he wasn’t sure if the single-family homes will have basements. The apartment buildings will have a small basement for mechanicals, but it won’t extend under the entire building.

Wendy Woods asked to clarify the term groundwater – she noted that groundwater is the term used to refer to underground water that’s been contaminated by Pall/Gelman Sciences with 1,4 dioxane. Gorenflo said he had been using the term only to refer to surface water – water that was on the ground.

Maple Cove: Commission Discussion – Developer Responsiveness

Several commissioners complained about the attitude of the developer. Wendy Woods said she was glad that more neighbors had come to raise their issues, and it seemed the project would cause a lot of concerns in the future. Even though she had previously voted in favor of the project, she said she didn’t think she could support it now. Hearing from the neighbors and seeing the unwillingness of the developer to address these issues were a big concern for her.

Erica Briggs observed that the developer was just coming in and doing what he wanted. The project isn’t consistent with the surrounding area, and there’s no discussion about meeting the basic needs of even the residents who’ll live in the new development, she said. Briggs noted that the developer hadn’t attended any planning commission meetings. The project reflects a problem with the city’s code, she said, or with the rezoning. Residents supported that previous project there, which was mostly offices, but this current development is nothing like that, she noted.

Briggs wondered if some of the minor issues could be addressed, at the least. ”Is there any way for these grievances to be answered?”

City planner Matt Kowalski replied that the planning staff had raised some of the same concerns as the neighbors and commissioners, but the project met the city’s regulations and code, so there was nothing the staff could do.

Briggs asked if there was any advice that could be provided to the neighbors. Nothing beyond speaking to the city council, Kowalski said. Planning manager Wendy Rampson suggested that neighbors could contact the developer directly and try to work something out.

Eric Mahler, the commission’s chair, pointed out that it’s not the staff’s role to be an advocate for the developer or anyone else.

Maple Cove: Commission Discussion – Density, Traffic, Sidewalks

Kirk Westphal observed that when people buy a home, they typically don’t look at the zoning of property around them – it usually only comes up when a project is proposed, like Maple Cove. He said there’s not much consolation for people who are debating the density of a project like this, other than to keep an eye on the process and contact their city council representative. But once the code is in place and follows the city’s master plan, there’s not much recourse. ”If code is something we want to change, we can always change that in the future,” he said.

Wendy Woods said she had raised concerns about a lack of sidewalks at the March 20 meeting, and she’s still not comfortable with that. Jamie Gorenflo with Midwestern Consulting said he couldn’t speak for the developer, but that the plan called for posting signs with a speed limit of 5 mph – a comment that prompted laughs from the residents. Other traffic-calming strategies would also be deployed, he said. Even if there were sidewalks from the single-family homes to North Maple, he said, there isn’t a sidewalk along North Maple to connect with. There will be a sidewalk in front of the development, but nothing on either side of it.

Tony Derezinski asked whether sidewalks can be required. Matt Kowalski clarified that sidewalks are required in the front of the development, along North Maple. Beyond that, sidewalks are only required for drives leading to developments with eight or more houses – this one had only seven houses. What about curbcuts? Derezinski asked. The developer is entitled to two curbcuts, Kowalski said, based on the project’s lineal frontage.

Derezinski said the problem is that a lot of people don’t like the city code, in this case – it’s a dilemma. The fact is, people are in a bind, but the city needs to follow the law, he said.

Westphal asked for clarification about why the decision was made that developments with less than eight houses did not require sidewalks. Kowalski said he didn’t know why the code was written that way, but that the planning staff had recommended sidewalks for this project. He noted that city code requires a sidewalk along the front of the property, along North Maple, but not on the drive leading back to the houses.

Maple Cove: Commission Discussion – Postponement

Evan Pratt noted that the city’s traffic engineer has stated that one driveway is preferable – there’s a reason for making that determination, he said. Pratt said he looked at it from a health, safety and welfare perspective, and he had concerns about two driveways onto North Maple. Pratt said he’d like to propose an amendment to approve the project contingent on it having only a single driveway. Otherwise, he said he’d like to postpone action until the developer could respond. He moved the amendment, which was seconded by Wendy Woods.

Tony Derezinski wondered whether such an action would violate the city’s zoning code. Wendy Rampson said the developer is entitled to two curbcuts, but the traffic engineer does have a certain amount of discretion. Pat Cawley was the city traffic engineer who prepared a report for this project.

Derezinski said the only hook for the city would be if the two driveways created a threat to public health, safety and welfare. That’s a fairly high standard, he noted, and the city is on tentative ground. For that reason, he said he’d prefer a postponement, not an amendment making the approval contingent on a single driveway.

Woods pointed to the summary of the traffic engineer’s report, as provided in the staff memo on the project:

The City Traffic Engineer has requested a consolidation of access points for the development in accordance with The City of Ann Arbor Transportation Plan Update, May 2009. In order to minimize potential conflicts along Maple Road, it is advised that the single-family and apartment buildings utilize the same access point.

“That speaks volumes to me,” she said. The access points – the two driveways – are close, Woods said, and create potential points of conflict. Citing the comments from neighbors and proximity of Skyline High, she said she’d like to take another look at requiring a single driveway. Woods joked that she was looking at the attorney across the room to get his response, but he wasn’t making eye contact. [Kevin McDonald of the city attorney's office was at the meeting, but did not comment on this issue.]

Planning commissioner Wendy Woods.

Eric Mahler pointed out that if the commission amended the resolution, they’d be amending the developer’s site plan, and the developer hasn’t had a chance to rebut. He said it was more procedurally tasteful to vote down the project, ask the developer to revise the site plan, then reconsider it at a future meeting.

Derezinski agreed, saying the commission was on “very tender ground.” If commissioners amended the agreement because of the threat to public health, safety and welfare, that’s a high threshold and they need to ensure that there’s documentation to support it, he said. Derezinski said he’d vote for postponement in order to get that documentation, but otherwise, “we shouldn’t do it.”

Kirk Westphal also weighed in to support postponement, saying it was unfortunate that the developer wasn’t there to respond. Erica Briggs said she wouldn’t give too much sympathy to the developer, pointing out that he had just as much opportunity to attend the meeting as the neighbors did.

Pratt withdrew his motion to amend, and said he’d also support postponement.

Mahler noted that the developer is under no obligation to consider any changes to his proposal. Commissioners need to recognize that a postponement might not move the needle on this project. “We can only request it,” he said.

Jamie Gorenflo with Midwestern Consulting told commissioners that the owner was committed to two entrances in order to market the apartments and single-family homes separately. Gorenflo said he was 90% sure the owner wouldn’t change his mind on this issue.

Diane Giannola said she supported postponement in order to hear from the traffic engineer regarding how big of a concern the two curbcuts are. Woods again pointed to the summary in the staff report, and argued that if even one child could get hurt, that’s a big concern. She said her blood pressure was rising, and that if Gorenflo had indicated there was no need to postpone because the owner wouldn’t change his mind, then she would feel vindicated in voting against the project.

Pratt then formally moved to postpone in order to get clarification from the city’s traffic engineer. The motion was seconded by Eleanore Adenekan.

Derezinski noted that the postponement related only to the curbcut issue – all of the other issues that had been raised weren’t part of the postponement. Woods replied that there might be other issues that would cause a commissioner to vote against the project. She asked whether there would be another public hearing on the project.

Mahler indicated that the commission would re-open the public hearing when the project is taken up again.

Westphal asked whether having a single curbcut would eliminate the sidewalk issue. Rampson responded that the planning staff couldn’t make code reviews on the fly, but they could look at that.

Outcome: Commissioners voted to postpone action on Maple Cove, to get more information from the traffic engineer about whether the proposed two separate entrances to the property created a health, safety and welfare hazard. The vote to postpone was 7-1, with dissent from commission chair Eric Mahler. Bonnie Bona was absent. No date has been set for when the project will next appear on the planning commission agenda.

Chalmers Place Parking

Planning commissioners were asked to vote on three resolutions related to a proposal for Chalmers Place, at 2090 Chalmers Drive near the intersection with Washtenaw Avenue: (1) rezoning a vacant lot from R1B (single-family residential) to P (parking); (2) authorizing the disturbance of a 25-foot natural features open space; and (3) a site plan for the parking lot. The site is west of Arborland Mall.

Aerial map of the lot (outlined in black) that was proposed to be rezoned from residential to parking. The lot is located directly north of the Chalmers Place retail center at 3365 Washtenaw Ave. (Links to higher resolution .pdf file)

Chris Cheng gave the report of planning staff, which recommended denial of the proposal. Reasons for denial included the fact that the proposal did not conform to the city’s master plan for that area, and because a parking lot would cause greater disturbance to the site’s natural features than a single-family residential development would.

The plan called for building a 43-space parking lot on the .92-acre site, which is now vacant. Most of the parking would be used by employees of the Chalmers Place Retail Center at 3365 Washtenaw Ave., located south of this site. Len Nadolski, the owner of both the retail center and the vacant parcel, and his representatives argued that they can’t fully lease the stores at the center without additional parking. Ten to twelve spots would also be set aside for park-and-ride commuters using the AATA bus stop on Washtenaw Avenue.

Chalmers Place Parking: Public Hearing

There were 18 people who spoke during a public hearing on the project, which lasted about an hour. A summary of their remarks is presented in this report. The majority of speakers were residents from the neighborhood who opposed the project, but the first three speakers were affiliated with the owner.

Jeff Smith of Professional Engineering Associates in Howell told commissioners that the owner’s team had worked very hard over the past year. This parking project is a last resort to help the struggling retail center. It’s a plan that could be approved, he said, and there’s a desperate need for parking. One of the primary concerns that people have cited is the removal of trees, and there seems to be a perception that this property contains high-quality woodland. But it’s really an overgrown residential lot, Smith said, and 42% of the trees are invasive. It’s not pristine in terms of natural features.

Smith said they knew that the master plan would be a challenge, but their justification for the project is that parking provides a natural transition between the retail center and the residential neighborhood, and is not out of character. It’s a unique project because a portion of the spaces are dedicated for an AATA park-and-ride lot. That can be pointed to as a special use, he said, so it doesn’t set a precedent for other projects. Traffic won’t be increased as a result of the lot, Smith contended. And the topography – a steep incline – is such that the lot will be 18 feet below Chalmers. Combining that with the evergreens to be planted as screening, and residents won’t be able to see the lot, he said. Smith concluded by asking commissioners for their approval: “We really hope you can keep this retail center going.”

From left: Len Nadolski, owner of Chalmers Place retail center; property manager Kevin Travers; and David Sharp, manager of the Verizon store at the center.

Kevin Travers, the center’s property manager, noted that the first tenants moved into the center in 2006. So it’s not like this approach to parking was the first thing they tried – in fact, it’s the last thing they wanted to do, he said. They’ve struggled to make the center viable and fill the stores, but there’s still 7,200 square feet with dirt floors, and a total of 9,800 square feet of vacant space. He said the property has been shown to more than 100 potential tenants, but parking is always an issue. The owner is ready to spend $250,000 on this new lot – it’s absolutely needed to survive, he said. This business has paid taxes, improved the side road, kept the area neat and clean. They’ve been good neighbors, he said. The city owes it to taxpayers to stabilize the tax base now and in the future, he concluded.

Matt Berke, a principal with Keystone Commercial Real Estate, told commissioners that he didn’t have much to add, but he wanted to attest that he’s the third broker for the property. He’s handled the property for over a year, and virtually every potential tenant voices the same concerns over parking. He said he knows of at least two tenants who’ve leased at other locations in this market.

Michael Roddy, owner of Paesano at 3411 Washtenaw, noted that his restaurant is directly across Chalmers from the retail center – he remembers when Arbor Dodge was located there. Roddy said he’d previously spoken to the city council and planning commission members about other issues on behalf of his neighbors, and he was here to do the same again. Unlike the Maple Cove developer, Roddy said, the owner of Chalmers Place had met several times with neighbors and others in the area. It’s a wonderful development that has increased the value of property, improved the sidewalks and done everything a good neighbor should do. Roddy said they don’t need more vacant lots or stores along Washtenaw. He also has seen people park in the Paesano parking lot and walk over to Chalmers Place. There are two businesses there that have customers and employees who fill the retail center’s parking lot. Roddy said the parking project would beautify the area, and he urged commissioners to support it.

Michael Homel, a resident of Wooddale Court, identified himself as a board member of the Woodcreek Homeowners Association, and noted that several other people who live in the Woodcreek development were at the meeting. Homel said he supported the staff recommendation of denial for this project. The main issue is zoning, he said – keep the commercial activity on Washtenaw Avenue, and the residential on Chalmers. Nothing has changed since the owner built the retail center, Homel observed, and perhaps better planning would have been a better approach. Homel noted that the owner says the retail center is struggling because of parking – that assertion can’t be proven or disproven, yet there are many other vacant stores in the area. There are probably a lot of reasons for those vacancies, and it’s not the role of others to plumb into that, he said.

Homel reminded commissioners that the owner had previously tried to rezone the property on Chalmers from single-family to multi-family residential. He also noted that the decision to allocate spaces for AATA park-and-ride was not an AATA initiative, and if there are spaces to spare for AATA, it seems to disprove the assertion that parking is needed for employees and customers. Finally, Homel said that although it’s true that the owner held a neighborhood meeting and did other outreach, the residents don’t support it. The Woodcreek Homeowners Association board had voted unanimously against the project, he reported. They support the planning staff’s findings, and he hoped the commission would deny the rezoning.

Amir Mortazawi, who lives on Woodcreek, said that he and his wife both oppose the project. He held up photos of the current parking lot, when there was plenty of parking. Parking should have been part of the business plan when the project was built, he said. Asking for the zoning change seemed like a way to circumvent the rules. He hoped that wasn’t the case. Mortazawi said he and his wife moved there 10 years ago hoping that they could walk to the shops along Washtenaw. That’s what the city should promote, he said. But they no longer walk along Chalmers – that would be risking their lives. The drivers for Jimmy John’s – one of the Chalmers Place tenants – drive fast along Chalmers. “We don’t need more businesses like that,” he said. Mortazawi urged commissioners not to make a bad situation worse by adding more traffic and fast drivers.

Lois Kamoi, a resident of Chalmers, said her daughter lives in the house adjacent to the proposed parking lot. Her property was purchased from Nadolski and she knew at that time that the adjacent land was also zoned residential. She was concerned that strangers in the parking lot could look down and see her grandchildren playing outside. Kamoi noted that at the neighborhood meeting that Nadolski held, the neighbors were told that the parking lot would be for employees. But later, the spots for AATA riders were added. Kamoi also disputed the need for more parking, saying that she walks her dog past there every day and she’s never seen the employee spaces full. The Jimmy John’s drivers take up several spaces in front, so perhaps they could park in the lot behind the center, she suggested. She also raised concerns about adding 43 more vehicles exiting onto Chalmers, if the new lot were built.

Gwen Nystuen, a member of the Ann Arbor park advisory commission, pointed to the master plan, which calls for that property to be residential. It’s appropriately zoned now, and keeping it that way would better protect the site’s natural features and the Mallets Creek watershed, she said. Nystuen also didn’t think it would be smart to add more traffic to that area, and she hoped commissioners would reject the rezoning.

Jane Heineken of Brian Court said there are already a lot of near misses as people pull out of Chalmers onto Washtenaw Avenue, as well as when people try to get in and out of Paesano, Chalmers Place and stores on the south side of Washtenaw. She’s a frequent AATA rider, and would applaud a park-and-ride lot in the area. But that would need to be accompanied by a crosswalk across Washtenaw. Currently, people try to dart across five lanes of traffic – it’s already a problem. As much as residents would like to see all the shopping centers along Washtenaw be successful, it’s important to look at the bigger picture, she said.

Danielle Gonzalez and her mother Madeline Gonzalez, who live across the street on Chalmers from the proposed parking lot, both spoke against it. The people who park behind the center now are loud, Danielle Gonzalez said, and a new lot would increase noise, traffic, and lights. It’s already difficult to turn onto Washtenaw, she said. Madeline Gonzalez asked commissioners to follow the planning staff recommendation, based on the issue of safety. Residents have the right for children to play in a safe area, but there are no sidewalks there and the cars drive fast. She also noted that residents weren’t told about the AATA park-and-ride spaces when they met with the owner, adding that AATA brings in “different elements.” She observed that Roddy likely supports the project because his customers use parking at Chalmers when the Paesano’s lot is full. Gonzalez said she wants the shops to succeed, but not to impact the quality of life in the neighborhood.

Jan Ulrich, an Oakwood resident, talked about the traffic along Washtenaw Avenue between Carpenter and Huron Parkway – “it’s a mess.” She had concerns about how the development got approved in the first place, given the traffic. It’s quite dangerous there, and she was pleased to see the planning staff’s recommendation for denial. Ulrich also raised environmental concerns for the project’s impact on Mallets Creek, and about the quality of life for residents. Pointing to the addition of parking for AATA, she noted there was an aspect of deception involved, too.

Two managers of tenants at the center spoke in support of the new lot. David Sharp, Verizon store manager, said there’s no one better than him to attest to the need for parking. He spends most of his day standing near the window that overlooks the lot. Between 10 a.m. and 2 p.m. there are few available spaces – he’s seen customers drive up and then leave because they can’t find parking. When tenants move into the four vacant stores, the problem will be even worse. He also noted that the types of businesses are a factor, too. Customers for some stores – like Verizon, and the nail salon – spend a long time at the business, so there’s not frequent turnover in parking. He strongly encouraged approval of the rezoning.

The manager of LUV Manicures & Pedicures also spoke in support of rezoning. She said the front parking lot is frequently full, and customers complain. She’d like to see more businesses in the center, which would help all the stores, but when that happens the parking will be worse. Customers will start to go elsewhere. Approving the project would benefit the entire center, she said.

From left: Michael Homel and Amir Mortazawi, residents of the Woodcreek subdivision, at the public hearing for the Chalmers Place parking project. Homel is a board member of the Woodcreek Homeowners Association. They were among the 10 residents who spoke in opposition to the project at the May 1 hearing.

Jim Sweetnam said there are people who are beloved to him that live in the neighborhood. It seemed that the most contentious issue relates to where the employees park. He said he’s in favor of park-and-ride – just not at that location. He suggested that employees could park elsewhere and take the bus to the center, which would save a lot of money and grief.

Marsha Brashears lives on Chalmers and said her biggest concern is the AATA park-and-ride. She couldn’t imagine the large AATA buses going up and down Chalmers, with families there. [The parking lot project would not entail any changes to AATA routes.]

Len Nadolski made a final plea for the project. He said he and the project team respect the watershed and don’t want to degrade or pollute it. The property is unique, and their plan is designed to reduce the impact on the neighborhood. He pointed to aspects of the plan that he said would improve the area and make it safer – including fencing, lighting, and security cameras. Vehicles would be towed if they don’t belong to employees, he said.

He argued that they haven’t been able to attract tenants because of the parking concern. Now, the project isn’t meeting the ratios required by its lending institution, he said. [Nadolski didn't specific what those ratios entailed. Common ratios are loan-to-value ratio, debt ratio, and debt service coverage ratio.] Nadolski said he wouldn’t invest in the parking lot unless he had to, but “we’re at a crossroads right now.” The center is at a desirable location, but parking is the problem. Referring to the city’s master plan, he said that every plan has the opportunity for exceptions, and he hoped the commission would take that into consideration.

Chalmers Place Parking: Commission Discussion

Erica Briggs said she felt for the petitioners, because the issue they’re facing is real. But the issues that planning staff raised are real, too, she said. It’s important to respect the fact that this proposal isn’t consistent with the city’s master plan or with the needs of the neighbors. Transportation demand management provides solutions beyond just the addition of parking space, Briggs noted, and a lot of TDM strategies are being deployed downtown. Washtenaw Avenue has been facing these challenges a long time, she said, and businesses should work together to find solutions. One possibility is to find another way to get employees to their work sites. Discounted bus passes would be one example, she said. This is a really significant issue that needs to be solved, but a parking lot isn’t the answer.

Kirk Westphal clarified with city planner Chris Cheng that it wouldn’t be a hardship to develop the property as it’s currently zoned – that is, it would be possible to develop the land for residential use. That’s correct, Cheng said. Westphal noted that unlike the Maple Cove site, this is a case where the zoning of the property meets the neighbors’ expectations, either as vacant property or as single-family residential. To him, that was a compelling reason to keep the zoning as it is. He said it’s not the planning commission’s place to speculate on why the retail center isn’t able to lease its stores.

From left: planning commissioners Evan Pratt and Kirk Westphal.

Wendy Woods agreed with Briggs and Westphal. She urged the owners to look for creative alternatives – perhaps an AATA shuttle from a remote parking lot. But that’s obviously not an issue that commissioners can solve now, she said. Woods expressed sympathy to the parking issue, but said it doesn’t rise to the level of rezoning.

Woods then smiled and said, “Let me just speak for the trees,” a remark that elicited laughter from her colleagues. Even though the trees are considered invasive or non-native, she said, “they still need to be respected.”

Tony Derezinski also spoke about possible parking alternatives, pointing to the large parking lot on the other side of Washtenaw Avenue where he said there always appears to be plenty of available parking. He alluded to the Reimagine Washtenaw Avenue project, saying that he hoped it would eventually improve walkability along that corridor. It was a tough situation, but he felt that deference should be give to the planning staff’s assessment.

Diane Giannola wondered if the retail center’s parking lot was used by commuters who parked there and then took a bus into town. Kevin Travers, the center’s property manager, noted that there was an AATA bus stop in front but that he didn’t think commuters parked there.

Giannola asked whether the planning staff had looked at other areas for parking. Cheng said it might be possible to restripe the existing lot for smaller spaces, and maybe reduce the setback along Chalmers. They might be able to gain at most 10 additional spaces by doing that.

Briggs noted that both the owner and the neighbors describe Washtenaw Avenue as uncomfortable for biking and walking, and it’s unsafe to cross the street. The city needs to work rapidly to improve that area, she said. If this owner is willing to invest $250,000 to build a parking lot, Briggs wondered how many other businesses would invest in improvements, like pedestrian-activated crossing signals (HAWK) or other changes to make it more pedestrian friendly. Instead of leaving it entirely up to the owners, perhaps the city could partner with them to find solutions, she said.

Eric Mahler said it comes down to a case of spot zoning against the master plan. The commission has been consistent in not doing that, he said, nor is it their place to look at financial data or forecasts. However, Mahler said he empathized with the owner, and had to give him the benefit of the doubt that potential tenants are being chased away because of the parking situation. It’s one thing to generalize and say that people should work together to come up with a solution, he said. But he had to assume that if there was another solution, the owner would have pursued it. Mahler said he had to support the project because he didn’t see any other option for the property owner.

Outcome: In three separate votes, planning commissioners voted 1-7 to recommend denial of the Chalmers Place proposal. Commission chair Eric Mahler cast the only votes in support of the resolutions. Neighbors in the audience applauded after the final vote was taken.

Medical Marijuana Zoning Revision

The planning commission was asked to weigh in on a proposed change to the city’s zoning code for medical marijuana dispensaries and cultivation facilities.

Earlier this year, the city’s medical marijuana licensing board had recommended one change – to strike the following sentence from the zoning ordinance: “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]

The board’s recommendation had been sent to Ann Arbor city council. But at their April 2, 2012 meeting, councilmembers voted 9-1 instead to direct the planning commission to review the medical marijuana zoning ordinance. The councilmember voting against that direction was Tony Derezinski (Ward 2), who also serves as a planning commissioner.

In a staff memo to planning commissioners, planning staff had recommended denial of the ordinance change. From the memo:

Without this provision in the City’s ordinance, there would be no way for staff to distinguish between a use legally allowed under the MMMA and a clearly illegal one. For instance, if the provision is removed, an applicant claiming to be a medical marijuana dispensary could comply with zoning, but actually be an illegal drug operation. Finally, keeping this provision in the list of requirements for the establishments for a medical marijuana dispensary or cultivation facility serves to clarify for potential applicants that the City will not approve a facility that is inconsistent with state law.

At the May 1 meeting, planning manager Wendy Rampson reviewed this history of the ordinance and the staff’s position. She noted that Kevin McDonald of the city attorney’s staff was present at the meeting and available to answer questions.

This proposed zoning ordinance change was one of three medical marijuana-related items that city council considered at its April 2 meeting. The other items were (1) revisions to the city’s medical marijuana licensing ordinance; and (2) direction to the city attorney to delay enforcement action against those dispensaries for which the city’s medical marijuana licensing board has recommended licenses. The council had unanimously postponed consideration of the licensing ordinance revisions until the council’s June 18 meeting.

And on a 6-4 vote, the council had tabled the resolution directing the city attorney to delay enforcement activities until the revisions to the local ordinances have been either adopted or rejected. A tabled resolution will demise if it’s not brought back off the table in six months.

For additional background, see Chronicle coverage: “Tension Grows in Medical Marijuana Debate,” and “Ann Arbor Marijuana Licenses: Who Decides?”

Medical Marijuana Zoning Revision: Public Hearing

The only speaker during a public hearing on the proposed zoning revision was Dennis Hayes. He began by noting that he had submitted a letter to the commission on behalf of a group of dispensaries operating in Ann Arbor. [.pdf of Hayes' letter]

Chuck Ream and Dennis Hayes pick up agendas prior to the start of the May 1 planning commission meeting. Hayes later spoke during a public hearing for the proposed changing to a zoning ordinance for medical marijuana dispensaries.

He asked that the sentence be removed from the zoning ordinance. He argued that McQueen decision was very narrow, and the case is literally up in the air, he said. [This was a reference to the lawsuit 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. The McQueen case has been accepted for review by the Michigan Supreme Court, which means that it’s not yet settled case law.]

Hayes noted that nine dispensaries in Ann Arbor have been recommended for licenses. As part of that process, the dispensaries are required to get zoning compliance permits. That’s been done, he said. [Rampson later clarified that zoning compliance permits have not, in fact, been issued yet.]

The issue, Hayes said, is that the city desires to interpret the zoning ordinance in a way that’s inappropriate and unnecessary. The medical marijuana dispensaries are already zoning compliant, he argued, and have business models that they believe are compliant with state law.

When the three minutes allotted to speakers during public commentary elapsed, Hayes indicated that because he was speaking on behalf of a group, he should be given a five-minute speaking turn. Rampson replied that he wasn’t speaking on behalf of a recognized group, such as a homeowners association, so his speaking turn was limited to three minutes.

Medical Marijuana Zoning Revision: Commission Discussion

There was only brief discussion of the resolution, and all commissioners seemed in agreement.

Diane Giannola noted that if she were asked to insert the sentence, she’d argue that it wouldn’t be necessary – it’s implied that state law should be followed. But deleting the sentence would indicate that people don’t have to comply with state law, she said, and that bothered her.

Giannola also observed that it’s difficult to talk about zoning for medical marijuana dispensaries when the issue is so political. Should the city remove the sentence from its zoning ordinance so that someone can get a license from the city for something that’s illegal? she asked. The McQueen ruling might be overturned, but does that mean the city should remove the sentence? It bothered her, she said, and she didn’t think the commission should have been asked to make a recommendation on this. She didn’t see how she could ever support it.

Tony Derezinski said he had similar thoughts. This zoning change was one of three resolutions that had been brought forward to city council, he said, to ameliorate the medical marijuana ordinances that had recently been passed after a hard-fought debate. He had a real problem procedurally with putting a burden on the planning commission to act. He didn’t like the process, and would vote against the resolution.

Evan Pratt said he didn’t think there was any dispute that state law must be followed. When the city wants to make that clear, then it is stated explicitly. If they want to be ambiguous, they would take it out. So leaving the sentence in place makes the ordinance less ambiguous, he said, and that speaks for keeping it in.

Kirk Westphal also opposed changing the ordinance, and said he echoed the staff report’s comment that removing the sentence would make it more difficult to differentiate between legal and illegal operations.

Erica Briggs pointed out that this zoning change is a separate issue from the one regarding whether zoning compliance permits should be issued. It may be that the city is denying permits unnecessarily, she said, but that’s unrelated.

Eric Mahler said he’d be extremely uncomfortable recommending the proposed change. That would result in authorizing illegal uses, and it would have severe consequences for the city, he said. Mahler said he wouldn’t want to explain to the state’s attorney general or anyone else why the city had taken out that sentence.

Outcome: Commissioners voted unanimously against recommending the proposed zoning ordinance revision.

Capital Improvements Plan

Cresson Slotten, manager for the city’s systems planning unit, was on hand to brief commissioners about proposed adjustments to the capital improvements plan, known as the CIP. The city code requires that the CIP be developed and updated each year, looking ahead at a six-year period, to help with financial planning. It’s intended to reflect the city’s priorities and needs, and serves as a guide to discern what projects are on the horizon.

Slotten noted that the CIP process mirrors the city’s two-year budget process. Last year, the city developed a CIP covering the fiscal years 2012-2017 – planning commissioners had approved it at their Jan. 4, 2011 meeting. It included a list of major capital projects, those that were funded as well as for those for which funding hadn’t yet been identified.

This is the second year of the two-year cycle, and Slotten described the changes as tweaks based on getting more information about a project’s scope, cost, schedule or other details. A more major effort will get underway later this year, as city staff prepare a new six-year CIP.

According to a staff memo, there are 345 projects or needs in the current CIP, including 131 for fiscal 2012 and/or 2013. For the update, there are 20 new projects that are proposed to be added and 17 projects deleted from the plan, resulting in a net total of 134 projects for fiscal 2013. [.pdf of proposed FY2013-2018 CIP]

Funding needs for fiscal 2013 – which begins July 1, 2012 – total $108,038,780. Of that total, 85.3% ($92,110,480) are projects for which funding is identified. The total funding need is roughly $16.637 million more than what was included in the FY 2012 CIP, an increase of 18.2%. The major adjustments summarized in the memo are:

1. Adjusting project schedules in city-owned buildings and the municipal airport from FY 2012 to FY 2013 (approximately $2.3 million shifted from FY 2012 to FY 2013)

2. Delaying the Washtenaw Avenue/US-23 underpass shared use path to FY 2013 – a delay due to the Michigan Dept. of Transportation ($2.8 million)

3. Shifting some new street projects related to private development from FY 2012 to FY 2013 ($1.5 million)

4. Adjusting the other street project schedules: resurfacing/reconstruction of the Ann Arbor-Saline Road from Eisenhower to the city limits ($1.05 million) and a new project for the South State Street/Ellsworth intersection roundabout ($1 million)

5. Increasing the funding schedule for renovation at the city’s wastewater treatment plant (approximately $4 million)

Slotten also introduced Devorah Gosselin, a recent hire as systems planning engineer who would be handling oversight of the CIP process in the future.

Commissioners held a public hearing on the plan, but no one from the public spoke during the hearing.

Capital Improvements Plan: Commission Discussion

Diane Giannola said it was her understanding that the CIP is a list of all possible projects, not just those that are approved. Yet when the city council removed the airport runway project from the CIP last year before approving the plan, that made it seem as though approving the plan was the same as approving all of the projects. She asked Slotten to clarify.

Slotten explained that the CIP is a list of identified needs, funded and unfunded. Technically, he said, the airport runway wasn’t removed from the CIP but was eliminated from the city’s capital budget. [The project – called the "runway safety extension" – remains in the proposed CIP, with funding in FY 2013 at $1.667 million.]

Giannola ventured that it’s not standard practice to remove items that are politically controversial. That’s right, Slotten replied, adding that the CIP is a list of key needs. Giannola noted that just because a project is included in the CIP doesn’t mean that it will be undertaken. That’s correct, Slotten said.

Tony Derezinski observed that there had been a lot of opportunity for public input. Slotten said that the proposed CIP had been posted on the city’s website for about a month, and sent to representatives of homeowner associations in the city. Derezinski confirmed with Slotten that to date, no public comment had been received on the CIP.

Wendy Woods asked about the roundabout at South State and Ellsworth. Many people were surprised when the project came up and a roundabout was proposed, she said. Now it seems that the project is funded and on a fast track.

Slotten noted that the intersection is at the city’s boundary with Pittsfield Township, and the Washtenaw County road commission is responsible for the portion of South State that’s south of the intersection, and for Ellsworth west of the intersection. The project is also keyed to the Costco project, which is expected to increase traffic to that area. The store is expected to open this summer.

Responding to a query from Woods, Slotten explained that the city was responsible only for a portion of the $2.6 million in funding listed in the CIP, but he wasn’t sure how much the city would pay. [The Ann Arbor city council subsequently approved that project at its May 7, 2012 meeting. The city will pay $350,000 for a water main improvement it wants to do anyway, and contribute an additional $135,000 to the intersection improvement.]

Erica Briggs noted that 90% of the unfunded projects were in the category of alternative transportation. Why is that percentage so high? she wondered. Slotten said that until recent years, the budget and the CIP were linked, and the CIP included only projects that had a funding source. It eventually evolved that for planning purposes, the CIP should include all projects that are identified as a need – funded and unfunded.

A lot of the alternative transportation projects are long-term and expensive, he noted. At this point, the major implementation expenses are unfunded. [Some of the major alternative transportation projects in the CIP are construction of a transit connector ($300 million) and the Fuller Road Station Phase II ($43.277 million).]

Eric Mahler asked about the 18.2% increase in total funding needed for the CIP, and noted that one of the main items related to the renovation of the wastewater treatment plant. He asked for more details about that $4 million increase.

Slotten said he couldn’t provide much more detail on the costs for that project. He noted that it’s the largest capital project the city has ever undertaken, at $136 million. [The city council approved award of the major construction contract for that project at its Feb. 6, 2012 meeting.] As it has evolved, $4 million as a percentage of the total isn’t very much, Slotten said. One key piece of that project was the city’s ability to obtain funding through the state’s revolving fund loan program. So instead of bonding, the city can get low-interest loans, which will save millions in financing expenses, he said.

Mahler said he was glad to see the wind project at the drop-off station on the list. [The funded needed for that project in FY 2013 is $250,000 with an additional $260,000 in FY 2014.]

Outcome: Commissioners unanimously approved adjustments to the city’s capital improvements plan for FY 2013-2018.

Master Plan Review

The planning commission’s bylaws require that the commission review the city’s master plan each May.

The resolution considered by commissioners affirmed the existing master plan, which consists of (1) Land Use Element (2009); (2) Downtown Plan (2009); (3) Transportation Plan Update (2009); (4) Non-motorized Transportation Plan (2007); (5) Parks and Recreation Open Space Plan (2011); and (6) Natural Features Master Plan (2004). These documents can be downloaded from the city’s master plan website.

Planning manager Wendy Rampson said the staff likes to keep the master plan fresh. She hoped that commissioners would spend some time reviewing the elements of the master plan to identify anything they’d like to add to the official master plan that state law requires.

The resolution presented to the commission stated that the group will continue to develop comprehensive plans for the Washtenaw Avenue and South State Street corridors. In addition, three minor changes were proposed:

• Adding the city’s park advisory commission, housing commission, and housing & human services board to the list of groups that are developing a sustainability framework for the city. Initially, only the planning, energy and environmental commissions had been involved.
• Stating that the planning commission will assist in updating the Non-motorized Transportation Plan, which was adopted in 2007; and
• Stating that the planning commission will update the land use element of the city’s master plan to include land use recommendations from the Huron River and Impoundments Management Plan (HRIMP). This had been discussed at a March 2012 meeting of the commission’s master plan revisions committee.

No one spoke during a public hearing on the proposed revisions, nor did commissioners have any commentary.

The planning staff had recommended postponing the resolution until the commission holds its annual retreat on May 29. Evan Pratt made a motion to postpone.

Outcome: Commissioners unanimously voted to postpone action on the master plan review.

Present: Eleanore Adenekan, Erica Briggs, Tony Derezinski, Diane Giannola, Eric Mahler, Evan Pratt, Kirk Westphal, Wendy Woods.

Absent: Bonnie Bona

Next regular meeting: The planning commission next meets on Tuesday, May 15, 2012 at 7 p.m. in the second-floor council chambers at city hall, 301 E. Huron St., Ann Arbor. [confirm date]

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The city’s medical marijuana licensing board had recommended one change – to strike the following sentence from the zoning ordinance: “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]

The board’s recommendation had been sent to Ann Arbor city council. But at their April 2, 2012 meeting, councilmembers voted 9-1 to instead direct the planning commission to review the medical marijuana zoning ordinance. The councilmember voting against that direction was Tony Derezinski (Ward 2), who also serves as a planning commissioner.

In a staff memo to planning commissioners, planning staff had recommended denial of the ordinance change. From the memo: “Without this provision in the City’s ordinance, there would be no way for staff to distinguish between a use legally allowed under the MMMA and a clearly illegal one. For instance, if the provision is removed, an applicant claiming to be a medical marijuana dispensary could comply with zoning, but actually be an illegal drug operation. Finally, keeping this provision in the list of requirements for the establishments for a medical marijuana dispensary or cultivation facility serves to clarify for potential applicants that the City will not approve a facility that is inconsistent with state law.”

There was only brief discussion of the resolution, and all commissioners seemed in agreement. Diane Giannola noted that if she were asked to insert the sentence, she’d argue that it wouldn’t be necessary – it’s implied that state law should be followed. But deleting the sentence would indicate that people don’t have to comply with state law, she said, and that bothered her. Evan Pratt said that leaving the sentence in place makes the ordinance less ambiguous.

Kevin McDonald of the city attorney’s staff was present at the meeting, but did not formally address the commission and was not asked any questions by commissioners.

Only one person spoke during the public hearing on the item. Dennis Hayes asked commissioners to remove the sentence from the ordinance – it’s inappropriate and unnecessary for zoning.

This proposed zoning ordinance change was one of three medical marijuana-related items that city council considered at its April 2 meeting. The other items were (1) revisions to the city’s medical marijuana licensing ordinance; and (2) direction to the city attorney to delay enforcement action against those dispensaries for which the city’s medical marijuana licensing board has recommended licenses. The council had unanimously postponed consideration of the licensing ordinance revisions until the council’s June 18 meeting.

And on a 6-4 vote, the council had tabled the resolution directing the city attorney to delay enforcement activities until the revisions to the local ordinances have been either adopted or rejected. A tabled resolution will demise if it’s not brought back off the table in six months.

For additional background, see Chronicle coverage: “Tension Grows in Medical Marijuana Debate,” and “Ann Arbor Marjiuana Licenses: Who Decides?”

This brief was filed from the second-floor council chambers at city hall, 301 E. Huron St., where the planning commission holds its meetings. A more detailed report will follow: [link]

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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Treecity Health Collective, a medical marijuana dispensary on South State Street. (Photos by the writer.)

One request was the first tied to the city council’s recent approval of zoning regulations for medical marijuana dispensaries. The operator of Treecity Health Collective, a dispensary at 1712 S. State, asked that the location be rezoned from O (office) to C1 (local business). In June 2011, the council approved amendments to the city’s zoning ordinances that prevent medical marijuana dispensaries from operating in office zoning districts. Rather than relocate the dispensary, the operator was asking for the zoning change. The property is located on the west side of State, south of Stimson.

While expressing sympathy for the operator, commissioners recommended denying the rezoning request, noting that the master plan calls for an office district in that area. It will now be forwarded to the city council for final action.

The commission considered a separate request for nearby parcels on the opposite side of South State, where the new Biercamp Artisan Sausage and Jerky opened about a month ago. The property – 1643 and 1645 S. State St., south of the Produce Station – is in Ann Arbor Township, and requires both annexation and zoning. The commission recommended approval of annexing the land, but postponed a decision on zoning. Biercamp owners are hoping for commercial zoning, which would allow them to expand the retail component of their business. The city’s master plan currently calls for light industrial zoning in that section.

In discussions for both Treecity and Biercamp requests, some commissioners pointed to the need for a comprehensive study of the South State Street corridor. Such a study has been planned, but earlier this year the city council voted against funding a consultant to conduct the work.

In other action, commissioners recommended annexing several Scio Township parcels that are located in a recently expanded well prohibition zone related to the Pall/Gelman Sciences 1,4 dioxane underground plume. Pall is paying for the hook-ups to city water and sewer, according to city planning staff.

Commissioners also recommended approval of a site plan at 3590 Washtenaw Ave., at the southwest corner of Washtenaw Avenue and Yost Boulevard. The plan calls for building a 9,500-square-foot, single-story addition to the existing 15,769-square-foot retail building that currently houses the Dollar Tree. It’s in the spot where Frank’s Nursery formerly operated, along the same stretch that’s part of the Reimagining Washtenaw Avenue project.

Wendy Rampson, the city’s planning manager, gave several updates to the commission. Among them, she noted that four projects previously approved by the city council are now asking for two-year extensions on their site plans: (1) The Gallery planned unit development (PUD) on North Main, at the site of the former Greek Orthodox church; (2) the 42 North residential development at Maple and Pauline; (3) the Forest Cove office building on Miller; and (4) the Mallets View office building on Eisenhower. Those requests are being reviewed by city planning staff.

During his communications from city council, Tony Derezinski, who also represents Ward 2 on council, mentioned that a final meeting for the R4C/R2A advisory committee is tentatively set for Sept. 21. He noted that the 21st is also Saint Matthew’s Feast Day, which he quipped might help the group finish up the project.

One member of that advisory committee is former planning commissioner Jean Carlberg, who received a resolution of appreciation from the commission at the beginning of Tuesday’s meeting. Her term ended June 30 – she served on the commission for 16 years.

South State Annexation & Zoning – Biercamp

The planning commission was asked to consider annexation of two parcels located in Ann Arbor Township “islands” – 1643 and 1645 S. State St., south of Stimson and next to the Produce Station. The property is owned by Stefan Hofmann, but the request was spurred by a new business – Biercamp Artisan Sausage and Jerky – that Hannah Cheadle and Walt Hansen opened at 1643 S. State about a month ago.

Biercamp Artisan Sausage and Jerky is located at 1643 S. State – the building on the left.

The parcels cover about 0.6 acres and include four non-residential buildings. In addition to Biercamp, other businesses on the property include Zak’s Auto Shop and Hofmann’s Furniture. The building at 1645 S. State is used for storage.

In the township, the site is zoned for light industrial. Hansen and Cheadle have requested that the parcels be zoned by the city for commercial use. This would allow them to expand the business – they eventually would like to sell Michigan craft beer and wine at the shop.

They have also applied to the township for a certificate of occupancy at that site, which would allow the business to be grandfathered in under zoning that permits it to sell items produced there. The city’s master plan calls for light industrial zoning in that area, but only allows for retail space to occupy 20% of the building’s floor area, to sell products made on-site.

Planning staff recommended annexing the properties, but postponing the zoning request until the issue of a certificate of occupancy is resolved with the township. Staff also recommended postponing action on a request to waive the area plan requirement for the site. A waiver is requested because no changes to the site are proposed.

South State Annexation & Rezoning – Biercamp: Public Hearing

The only speakers during a public hearing on the issue were Biercamp owners Walt Hansen and Hannah Cheadle. Cheadle noted that they’d come to the meeting straight from work: “We probably smell like smoked sausages.” She told commissioners that she and Hansen were originally from northern Michigan, but had lived in New York City for six years before moving to Ann Arbor about six months ago to open their business.

Walt Hansen and Hannah Cheadle, owners of Biercamp Artisan Sausage and Jerky.

She said they felt the zoning to C3 (fringe commercial district) was appropriate, since the property is located near commercially zoned land along Stimson and South Industrial. The store is directly adjacent to the Produce Station, which is located to the north on State.

An appraisal done on the two properties included a zoning analysis, Cheadle said. The appraiser had talked to city planner Matt Kowalski, who had said C3 zoning would be appropriate in the context of other zoning in the area, she reported.

Cheadle told commissioners that during the month that the Biercamp has been open, the response from customers has been amazing. More than 300 people have already signed up to receive the store’s email, she said. Cheadle noted that one of the city’s concerns is if the parcels were zoned C3, it would be possible for other types of businesses – like drive-through fast food restaurants – to open there, if Biercamp went out of business. Biercamp is there for the long-haul, she said, but they would be limited if the land is zoned for light industrial.

Hansen added that they hope to eventually start selling Michigan beer and wine in the shop.

South State Annexation & Rezoning – Biercamp: Commissioner Discussion

Diane Giannola led off the discussion, saying she didn’t support zoning the land as C3 or C2B (business service district). She said she felt for the owners, but this would amount to spot zoning, which she said the courts have shown is illegal. Even though it’s a great business and the kind of company that the city hopes to see, the problem is what type of business might want to operate there later, she said. If the city approves this type of zoning, then owners of the parcel next to them could use the same excuse to change the zoning too – and it would just continue down State Street. The city needs to be consistent with its master plan, she said.

Further, planning staff and commissioners have talked about the need to do a comprehensive study of the South State Street corridor, Giannola noted. But the city council hadn’t approved funding of the study. To her, that action showed that councilmembers aren’t interested in rezoning the area.

There are many other places in the city where the business could operate and be successful, Giannola said. Just because the owners didn’t do their due diligence before locating there doesn’t mean the city should make an exception about the zoning and risk a lawsuit, she concluded.

Tony Derezinski said he appreciated Giannola’s heartfelt comments, but there’s another side. Sometimes an area is zoned for one purpose but it evolves to be appropriate for other uses, he said. In this case, having Biercamp located next to the Produce Station is a benefit to customers of both businesses, he said. It’s a unique parcel, he added, in part because it’s a township island. For those reasons, Derezinski didn’t think it would set a precedent for zoning, and it’s the type of business the city wants to encourage.

City planner Chris Cheng clarified that the reason for the annexation related to the need to hook up to the city’s sewer system. That has now occurred – the site had already been hooked up to city water. He noted that the township’s I-1 light industrial zoning is very similar to the city’s M-1 limited industrial zoning. The main difference is that the township would allow products made on site to be sold in 100% of the floor area. For the city, M-1 zoning only allows sales on 20% of the floor area. But if the township grants Biercamp a certificate of occupancy before annexation occurs, that would allow the city to grandfather in the business under the township’s zoning, Cheng said.

Cheng noted that the city planning staff feels that M-1 zoning is appropriate for this site.

Erica Briggs strongly supported zoning the parcels as commercial – probably C2B would be best, she said, since it would prevent drive-through businesses. If commissioners simply looked at the south area plan, then M-1 zoning would apply, she observed, but that plan is out of date. Looking at more current indicators – including environmental and sustainability goals – all point to this kind of use, she said: locally produced food, and neighborhood businesses that people can reach by biking or walking. It would be crazy not to support and nurture this, she said. If this type of business continues down State Street, she added, “I say great – all the better.”

The original plan for that area had envisioned it becoming a tech corridor, Briggs noted, but on the ground, it’s evolving into something else. She said she’d support C2B zoning for the parcels.

Kirk Westphal drew out the fact that Biercamp was operating without a certificate of occupancy from the township, and that this was somewhat unusual. He clarified with Cheng that the township’s light industrial zoning was more permissive regarding how much of the floor area could be used for retail.

Westphal confirmed this is not the first time that a zoning change has been requested in that area. Cheng reported that the property management firm McKinley had previously requested rezoning from light industrial to commercial for a property further south on State Street, where Tim Horton’s was interested in building a shop. That request had been denied.

In that case, Westphal said, it was a fairness issue – coupled with the fact that the city intends to study that entire corridor in the future. For those reasons, he was inclined to defer to the planning staff regarding their zoning recommendation for the two parcels. The commission also needs to think long-term, he said, and if ownership of the property changes hands, other businesses might open that don’t fit in that area. Westphal said he’d be in favor of doing a corridor study as soon as possible, and he hoped that Biercamp could continue to operate in that location in the meantime.

From left: Planning commissioners Wendy Woods and Diane Giannola.

Wendy Woods was curious to know what would happen if the parcels were annexed, but the zoning remained unresolved. What would it mean for the business? Wendy Rampson, head of the city’s planning staff, said that was tricky. The city doesn’t want to inherit an unresolved situation, she said, and it’s currently in the township’s hands. So far, there’s been good collaboration between the two jurisdictions, she added.

Woods said it seemed like there’s an informal agreement with the Produce Station to use parking for Biercamp customers – is that the case? No, there’s no agreement, Cheng said, although it’s true that some customers who park at the Produce Station do walk over to Biercamp’s shop.

Bonnie Bona wondered why this was coming forward now – why did the business need to connect to water and sewer now, if that hadn’t been an issue previously? Cheadle came forward and responded, saying that she and Hansen had approached the township for an analysis of the parcel’s septic system, after being told by a state health inspector that this was a requirement prior to opening their business. At that point, they were told by the township that the property needed to be hooked up to the city’s sewer system instead, because Biercamp was a new business. The property had previously been hooked up to city water.

Rampson clarified that the property owner, Stefan Hofmann, had been told in 2009 that he needed to connect to a city sewer. He had not come forward voluntarily to do that, she said, so that’s why the issue emerged when Cheadle and Hansen approached the township.

Hansen then clarified that the only reason he and Cheadle were requesting a certificate of occupancy was so that they could be grandfathered in under the township’s zoning. Cheng reported that the township is expected to issue the certificate soon, based on his conversations with township planning staff.

Bona said she hoped the certificate of occupancy would be granted, so that Biercamp could continue to operate there, rather than having them risk being annexed into a zoning category that wouldn’t permit their business. She noted that she struggled with conflicting issues. The master plan is about more than just land use – it relates to transportation, traffic and other issues. The State Street corridor has some of the most intense traffic in the city, she said, especially near Stimson, where the road narrows down from four to two lanes. All she can do, she added, is push for a corridor study so that the zoning is well-planned and not arbitrary.

Meanwhile, Bona added, she hoped that Hansen and Cheadle had a backup plan. She noted that there are a lot of commercial vacancies in the city, especially along Washtenaw Avenue. Bona also asked that a better explanation of the parking arrangement with the Produce Station be provided.

Eric Mahler asked what would happen if Biercamp doesn’t get a certificate of occupancy, and the parcels are annexed under the city’s M-1 zoning. In that case, Cheng said, Cheadle and Hansen would likely be back to the planning commission to lobby harder for C3 or C2B rezoning.

Outcome: Commissioners unanimously voted to approve recommending annexation – the request will now move forward to the city council for approval. A request to zone the properties as C3 (fringe commercial district) was postponed, as was a request to waive the site’s area plan requirement.

After the vote, Derezinski asked Cheadle and Hansen when their shop is open. The store hours are 11 a.m. to 7 p.m. Monday through Saturday. Biercamp is closed on Sundays.

Treecity Health Collective Rezoning

In the first such request to the Ann Arbor planning commission following the city council’s approval of zoning regulations for medical marijuana dispensaries, the operator of Treecity Health Collective, a dispensary at 1712 S. State, asked that the location be rezoned from O (office) to C1 (local business). A waiver of the area plan requirement for that location was also requested.

Planning staff recommended denying the request, because C1 zoning is not consistent with adjacent zoning, land uses and the city’s master plan. City planner Chris Cheng told commissioners that the type of zoning requested would be considered spot zoning, and not appropriate.

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

Treecity Health Collective Rezoning: Public Hearing

Dori Edwards was the only person to speak during the public hearing on these requests. Treecity is a nonprofit medical marijuana dispensary, she said, and provides other health practitioner services. Although the building is located in an area zoned for offices, the neighboring businesses are non-traditional – a masseuse and a palm-reader.

Dori Edwards, employee of Treecity Health Collective, during a public hearing at the Aug. 16, 2011 Ann Arbor planning commission meeting.

The city council has broad discretion to deviate from the city’s master plan, she noted. Edwards said she’s not a planner, but she did read through the city’s master plan online, and could not find anything that indicated her zoning request would be illegal. The city already allows spot zoning to occur, via planned unit developments (PUDs), she said. That kind of zoning requires public benefit, and Edwards said it’s a public benefit to allow her nonprofit to operate at its current location, because of the nature of her clientele. She urged commissioners to approve the rezoning request.

Treecity Health Collective Rezoning: Commissioner Discussion

Diane Giannola began by saying that this request proved the point she made during the Biercamp discussion. The site was located across the street and a couple of parcels south of the Biercamp location. So how could the city approve one request and not the other? It’s arbitrary, she said. The city needs to do a study of the South State Street corridor so that rezoning doesn’t occur arbitrarily.

She asked why the recent zoning ordinance for medical marijuana dispensaries didn’t allow that type of business in areas zoned for offices. City planner Chris Cheng said the reason was that dispensaries seemed more akin to pharmacies, not medical offices.

Bonnie Bona asked why the request was for C1 zoning, not C3 or C2B. Cheng replied that C1 was the minimal intensity of commercial zoning that would still allow the dispensary to operate – it doesn’t allow for uses like auto shops or manufacturing. But city staff wouldn’t recommend any type of commercial zoning, he said.

Then directing her comments to Edwards, Bona said that PUDs require additional public benefits tied to the site plan – the public benefit isn’t simply the type of business that’s located there.

Wendy Woods acknowledged that she hadn’t followed the council deliberations on medical marijuana closely. She wondered if the council’s intent was to restrict dispensaries to certain districts in town. She assumed they’d discussed the possibility of grandfathering in the locations of existing dispensaries?

Tony Derezinski, who also represents Ward 2 on city council, said the council wanted to avoid legal challenges to the ordinance. However, they also wanted to plan for dispensaries to be located in certain areas, with restrictions like distances from schools and churches, he said. There were no specific discussions about instances like the one now being considered by the planning commission, he said.

Derezinski went on to describe the state referendum regarding medical marijuana as poorly written and very ambiguous. For the council’s part, the general notion was to take a more restrictive approach to zoning, he said.

Woods asked if there were other dispensaries located in areas where the newly-enacted zoning would no longer allow them to operate. There are several located in office districts, said Wendy Rampson, head of the city’s planning staff. One dispensary held a citizen participation meeting in July, but decided not to pursue rezoning. Cheng noted that no one showed up for the Treecity citizen participation meeting related to the rezoning request.

Erica Briggs said she was frustrated and torn by this situation. This dispensary seemed to her to be an appropriate use of office space, fitting with compatible businesses in the area. No one came to the public hearing to complain, she noted. So she wished that dispensaries were allowed in office districts – but acknowledged that they’re not.

This request differed from the Biercamp request because the Treecity property isn’t located adjacent to other commercially zoned land, Briggs said. She supported extending commercial businesses along South State, but there’s not a precedent for doing that yet. She expressed sympathy for Edwards’ situation.

Kirk Westphal asked whether the fact that Treecity is a nonprofit has any bearing on the request. It does not, Cheng replied. Westphal confirmed with Cheng that any change in zoning would be attached to the land, not the business. Westphal said it was a shame that the state law is vague and that livelihoods are being disrupted, but he couldn’t support the rezoning request.

Giannola asked whether Edwards could apply for a special exception use, to allow her to operate the dispensary at that site. Cheng said he didn’t believe that would be possible. Rampson explained that the zoning ordinance would have to be amended in order to allow a special exception use for the dispensary. That process would begin with the planning commission, she said.

Outcome: Commissioners unanimously voted against recommending approval of the rezoning request. The recommendation will be forwarded to the city council.

Site Plan for Former Frank’s Nursery

Commissioners were asked to approve a site plan for 3590 Washtenaw Ave., at the southwest corner of Washtenaw Avenue and Yost Boulevard. The plan calls for building a 9,500-square-foot, single-story addition to the existing 15,769-square-foot retail building that currently houses the Dollar Tree. The new space is designated for an additional tenant.

The building addition would replace an existing unenclosed canopy area used by the former tenant, Frank’s Nursery. The site is part of a larger retail center along Washtenaw Avenue that consists of five parcels with the same owner. The site plan includes construction of a new public sidewalk in the Yost Boulevard right-of-way fronting the site. An existing 22-foot service drive on the north part of the site would be converted from pavement to turf, and a new 10-foot-wide non-motorized path is proposed.

The project had previously received approval from the Washtenaw County water resources commissioner for its stormwater system, using bioswales and underground pipes in the parking lot area. Since then, changes were made to the city’s landscape ordinance, which now requires additional modifications to the bioswales and an additional review by the water resources commissioner. That approval is required before the site plan will be placed on a city council agenda. The bioswales will be planted with native vegetation, including trees, and will also act as the required interior parking lot landscaping.

Site Plan for Former Frank’s Nursery: Public Hearing

Two people spoke during the public hearing. Damien Farrell, the project’s architect, said he was there on behalf of the owner [Renken Associates] to answer any questions.

Dennis Ritchie told commissioners that he’d lived for 35 years in a home just south of the Washtenaw Avenue property, and he was pleased to see improvements in the shopping district. It would do nothing but improve his experience as a homeowner if a viable business was located there, he said. The Dollar Tree is less of a problem for him than Frank’s Nursery was – now there’s no one on a PA system saying there’s two bags of sheep shit to be loaded, he quipped.

Ritchie noted that the Ann Arbor Transportation Authority intends to create a pullout along that stretch of Washtenaw Avenue. He wanted to ensure that the site plan wouldn’t have an impact on that project.

Site Plan for Former Frank’s Nursery: Commissioner Discussion

Tony Derezinski agreed that having a vibrant business was better than a vacant property, as is now the case. The site is one of the major pieces in the Reimagining Washtenaw Avenue project, he said, noting that it was part of the bus tour that commissioners had taken earlier this year during their retreat. [The revitalization effort focuses on a five-mile stretch between Ann Arbor and Ypsilanti, which also crosses land within Pittsfield and Ypsilanti townships. It's the county’s most congested – and, in many sections, blighted – commercial corridor. For background, see Chronicle coverage: "County Board Briefed on Washtenaw Corridor"]

Wendy Woods asked where the pedestrian crossing would be across Washtenaw Avenue. At the intersection with Pittsfield Boulevard, Rampson answered. Woods then asked whether the Reimagining Washtenaw project team is still meeting, and if another crossing is being considered? [Arborland is located across the street from the site that was being discussed by the planning commission. There is no bus stop currently in that area on the Arborland side, so people using the bus must walk across Washtenaw, a high-traffic roadway.]

Derezinski said that the AATA had been unceremoniously thrown out of Arborland – the owners of Arborland no longer wanted a bus stop within the shopping complex, and it had been removed in 2009. The stop is now located on the opposite (south) side of Washtenaw Avenue. There’s the possibility of putting a stop on the north side, he added, on property not owned by Arborland, but that hasn’t been finalized.

As for Reimagining Washtenaw, there had been a personnel transition, he said. Anya Dale, the former Washtenaw County planner who staffed the project, has taken a job at the University of Michigan. Derezinski said he’s talked with Mary Jo Callan, head of the county department that’s now overseeing the project – he reported that Callan is determined to keep it alive.

Rampson noted that while the only pedestrian crossing now in that area is at Washtenaw and Pittsfield, the Michigan Dept. of Transportation (MDOT) is working on an pedestrian underpass project at Washtenaw and US-23. As part of that, there’s discussion about the possibility of a pedestrian crossing at Washtenaw and Yost, she said. City planning staff will be meeting with MDOT officials later this month to talk about these possibilities.

Kirk Westphal asked about the materials that would be used on the building. Farrell said his client had been negotiating with a potential tenant for a long time, and they hadn’t yet settled on specifics. If the tenant signs on, they’ll have some of their own requirements, he said.

Bonnie Bona questioned why there’s a 40-foot-wide lane in the parking lot – is that necessary? Farrell said that’s the way the site is currently configured, and there are no plans to change it. Bona suggested alternatives that would narrow the lane, such as increasing the size of traffic islands or adding more landscaping.

Bona also pointed to landscaping on the building’s east side, and said that might be an opportunity to create some public space, like an area for outdoor seating.

Outcome: Commissioners voted unanimously to approve the site plan. It will now be forwarded to the city council.

Annexation of Scio Township Parcels

On the agenda was a request to annex seven parcels from Scio Township – totaling about 2.94 acres – and to zone them R1C (single-family residential). The sites are: 545 Allison Drive; 427 Barber Ave.; 3225 Dexter Road; 3249 Dexter Road; 3313 Dexter Road and a vacant adjacent lot; and 305 Pinewood Street. The annexation and zoning also requires city council approval.

The sites are located in a recently expanded well prohibition zone related to the Pall/Gelman Sciences 1,4 dioxane underground plume. Pall is paying for the hook-ups to city water and sewer, according to city planning staff.

No one spoke during a public hearing on the annexation.

Chris Cheng of the city’s planning staff clarified that the master plan calls for all parcels there to be zoned R1C.

Outcome: Planning commissioners unanimously recommended annexing and rezoning the Scio Township properties. The request will be forwarded the city council for approval.

Honoring Jean Carlberg

At the start of Tuesday’s meeting, the commission presented a resolution of appreciation to former commissioner Jean Carlberg, whose term ended June 30. She served on the commission for 16 years.

Jean Carlberg with her husband, Bunyan Bryant Jr.

Carlberg is a Democrat whose 12 years on the city council – representing Ward 3 from 1994 to 2006 – overlapped with her time on the planning commission. After stepping down from the commission, she is no longer serving on any other city government boards or commissions. She is a board member of the Washtenaw Housing Alliance, a nonprofit consortium of groups working to end homelessness in the county.

The resolution of appreciation – read by planning commission chair Eric Mahler – cited Carlberg’s “thoughtful and pragmatic approach to projects and issues being considered by the Ann Arbor City Planning Commission,” and stated that she “provided innovation, leadership, equanimity and tireless diligence to the City Planning Commission and the City of Ann Arbor in the interest of the City’s planning efforts.” The resolution stated that the commission will miss her “knowledge, expertise, thoughtfulness and quiet humor.”

Carlberg was on hand to accept the resolution, which was given to her on a wooden plaque. She told her former colleagues that she learned a lot during her tenure, both from the planning staff and from the other commissioners, who bring a breadth of experience to their discussions. The diverse backgrounds of commissioners are a benefit, she said, with each person raising individual concerns from their perspectives.

”I miss you all. I miss the work,” Carlberg said. She received a round of applause from commissioners.

Eleanore Adenekan was appointed in July to replace the position vacated by Carlberg.

Misc. Communications

Wendy Rampson, head of the city’s planning staff, gave several updates. She reminded commissioners that their next regular meeting would be on Thursday, Sept. 8, following the Labor Day holiday. Their next working session, on Tuesday, Sept. 13, would be devoted to a talk on sustainability by Dick Norton, chair of the University of Michigan’s urban and regional planning program. [Planning commissioners had been briefed on the city's efforts to develop a sustainability framework at their working session earlier this month. The park advisory commission received a similar briefing at their Aug. 16 meeting.]

Rampson also said that the Summers-Knoll School project is being revised. At its May 17, 2011 meeting, the planning commission had granted a special exception use to allow the school to move to a building at 2203 Platt. At that meeting, commissioners had asked that the school add a continuous sidewalk along the east side of the building, and ensure clearly defined walkways to all of the entrances. In addition to that work, Rampson said, school officials have also decided to change the configuration of the parking lot, and have asked for an administrative amendment to do that work. It does not require additional commission approval.

Rampson also reported that developers on several projects are asking for site plan extensions. These are site plans that have been approved by the city council, but that haven’t yet been constructed. City code allows for extensions of that approval in two-year increments, she explained. Now the city staff are reviewing the projects to make sure they still conform with city ordinances, which might have changed since the projects were initially approved. For example, the city council gave final approval in January 2011 to a set of changes in the city’s zoning code for regulations affecting area, height and placement (AHP). The city’s landscaping ordinance has also been recently revised.

There are requests for site plan extensions on four projects: (1) The Gallery planned unit development (PUD) on North Main, at the site of the former Greek Orthodox church, (2) the 42 North residential development at Maple and Pauline, (3) the Forest Cove office building on Miller, and (4) the Mallets View office building on Eisenhower.

During his communications from city council, Tony Derezinski, who also represents Ward 2 on city council, mentioned that a final meeting for the R4C/R2A advisory committee is tentatively set for Sept. 21. He noted that the 21st is also Saint Matthew’s Feast Day, which he said might help the group finish up the project. [See Chronicle coverage: "No Consensus on Residential Zoning Changes"]

Present: Bonnie Bona, Erica Briggs, Eleanore Adenekan, Diane Giannola, Eric Mahler, Kirk Westphal, Wendy Woods, Tony Derezinski.

Absent: Evan Pratt.

Next regular meeting: The planning commission next meets on Thursday, Sept. 8 at 7 p.m. in the second-floor council chambers at city hall, 301 E. Huron St., Ann Arbor. [confirm date]

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However, at their Aug. 16, 2011 meeting, planning commissioners recommended denial of the requests, based on a staff recommendation, stating that C1 zoning is not consistent with adjacent zoning, land uses and the city’s master plan.

The Treecity Health Collective opened in 2010. This summer, the Ann Arbor city council approved amendments to the city’s zoning ordinances that prevent medical marijuana dispensaries from operating in office zoning districts – those changes are set to take effect on Aug. 22, 2011. Rather than relocate the dispensary, the business owner – Dori Edwards – is asking for the zoning change. Dori Edwards, an employee of Treecity, was the only person to speak during the public hearing on these requests. The property – located on the west side of State, south of Stimson – is owned by Francis Clark.

The requests will now be forwarded to the city council, accompanied by the planning commission’s recommendation of denial.

This brief was filed from the planning commission’s meeting in the second floor council chambers at city hall, 301 E. Huron St. A more detailed report will follow: [link]

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]

Seated is Roger Fraser, who attended his last Ann Arbor city council meeting on April 19 as city administrator – he gave a formal presentation to the council of the FY 2012 budget. He’s chatting before the meeting with the city’s chief financial officer, Tom Crawford, who was appointed interim administrator later in the evening. He’s not telling Crawford: “Whatever you do, don’t let the council tie your hands, see?” (Photos by the writer.)

After public hearings on the two medical marijuana laws, the council did not deliberate long in deciding to postpone both votes until its next meeting, on May 2. Substantive amendments that had been presented to councilmembers late that day for consideration made them reluctant to attempt grappling with the amendments in detail. The May 2 vote on the two laws will likely count only as their initial approval, assuming the amendments are adopted at that meeting. The laws would then need an additional final reading after May 2 before they are enacted.

A tweak to the city’s panhandling ordinance was given its second and final approval at the April 19 meeting. That change to the existing ordinance had come as a recommendation from a task force that worked for six months on the issue, following up on a longer effort in the early 2000s that had led to adopting the language in the existing ordinance.

The longest deliberations of the night involved a resolution of instruction to the council’s “mutually beneficial” committee, which is currently negotiating a new contract under which the Ann Arbor Downtown Development Authority would continue to manage the city’s public parking system. The direction given to the committee was not to stay firm with its previous bargaining position, but rather to escalate the city’s expectations for revenues from the public parking system.

Previously, the city’s committee had taken the position that the city should receive 16% of gross parking revenues in the first two years of a 10-year contract, and 17.5% in remaining years. That compared with the DDA’s position that the city should receive a flat 16% across all years. But at the meeting, the council voted to direct its committee to take the position that the city should receive a flat 18%. The council’s deliberations included comments directed towards the DDA that could fairly be described as inflammatory.

Called to the podium to comment on the parking revenue figures and the DDA’s overall financial health was the city’s chief financial officer, Tom Crawford. Later in the meeting, Crawford was appointed interim city administrator, effective April 28. Current administrator Roger Fraser is leaving the post to take a job as a deputy treasurer for the state of Michigan.

Although councilmembers did not comment on it, Fraser was attending his last meeting of the council as city administrator. And in his final major act, he gave a formal presentation to the council of his proposed fiscal year 2012 budget, as required by the city charter. The charter stipulates that the council will need to amend and approve the budget by May 16, its second meeting that month.

Parking Revenue

The longest deliberations of the night took place on the issue of how much revenue from the public parking system the city should take for use at its discretion. Those deliberations took place against the backdrop of the formal budget presentation by the city administrator for fiscal year 2012, which begins July 1, 2011.

Parking Revenue: Background – City-DDA Relations

In front of the council for consideration was a resolution giving instruction to its “mutually beneficial” committee, which is currently renegotiating a new contract under which the Ann Arbor Downtown Development Authority would continue to operate the city’s public parking system.

The city’s negotiating team – councilmembers Carsten Hohnke (Ward 5), Christopher Taylor (Ward 3) and Margie Teall (Ward 4) – had previously insisted that in the first two years of a 10-year contract, 16% of gross revenues to the public parking system would be allocated for use by the city at its discretion, with that amount rising to 17.5% of gross revenues in remaining years.

The DDA’s position had been consistent with the city’s previous request for the first two years of the contract, which would have the city withdraw 16% of gross revenues from the public parking system in each of those years. But the DDA’s current position is that for remaining years of the contract, the city’s share of gross parking revenues should remain at 16% instead of rising to 17.5%.

After the meeting, Christopher Taylor (Ward 3) gives an interview to Andrew Cluley, a reporter with WEMU, about the outcome of the mutually beneficial resolution of instruction.

The decision to bring a resolution of instruction to the council had come at a meeting between the respective mutually beneficial committees of the city council and the DDA on Monday morning, April 11. The resolution was meant to get a reading of the council’s support for either the DDA’s  position or the city committee’s position. [For detailed previous coverage: "City, DDA Continue to Talk Parking, Taxes"]

The existing contract under which the DDA manages the parking system is not based on a percentage of gross transfer. Instead, it’s composed of a transfer to the city’s street repair fund and “meter rent” of $1 million per year. Renewed in 2005 for a 10-year term, the contract allows for the city to transfer up to $2 million in a given year, provided the total amount transferred as “meter rent” does not exceed $10 million for the term of the contract. In each of the first five years of the contract, the city elected to transfer $2 million. Last year, the DDA transferred another $2 million as meter rent to the city, though it was not required under the current contract. [Chronicle coverage: "DDA OKs $2 Million Over Strong Dissent"]

Parking Revenue: Background – City FY 2012 Budget

Fraser’s formal budget presentation – which he previewed at a city council work session on April 11 and at a town hall meeting on April 13 – does not appear to depart in significant ways from the department-by-department budget impacts that department managers have presented to the council at a series of work sessions since the beginning of the year.

Highlights for 2012 include the layoff of five police officers, three other non-officer positions in the police department, and five firefighters. In other, non-safety services departments, Fraser is proposing – through retirements or already vacant positions or layoffs – to eliminate two positions in forestry, a partial position in facilities, one position in trash collection, a fleet mechanic, a management assistant, a Teamster supervisor, an accountant, two IT positions, and a court clerical position.

With additional reductions in FY 2013, the total employee count for the city would decrease to 688 down from a high of 1,005 in 2001 and from 848 in 1987.

Fraser’s proposed FY 2012 budget also includes a reduction of $116,000 in support for human services nonprofits. Other significant savings – roughly $475,000 – are realized through allocation of some forestry operations to the storm water fund. The FY 2012 also assumes that the street repair millage will be renewed by voters in the fall of 2011, and that the millage will subsume the city’s sidewalk repair program, freeing the Metro Act fund to absorb roughly $212,000 in general fund expenses like snow/ice removal and traffic island maintenance/mowing.

Parking Revenue: Background – “Shortfall” in FY 2012 Budget

At the city council work session on April 11, Fraser had responded to scripted questions from Hohnke and Taylor about the impact on the city’s ability to provide services, assuming the flat-16% scenario as compared to the 16-16-17.5% scenario. They were giving Fraser a chance to respond to the observation that had been raised during discussions by DDA board members: If there’s a perceived “shortfall” in the amount of parking revenues withdrawn from the parking system compared to previous years, then that “shortfall” amount is the same in the first two years of the contract, under either the city’s or the DDA’s scenario. That is, on their face, the two different scenarios would not appear to require different budget decisions this year or next (FY 12 and FY 13) – the two years for which the city is currently planning its budget. [Although the city adopts budgets one year at a time, it plans in two-year cycles.]

But Fraser contended at the April 11 work session that the two scenarios would require different choices this year. He explained that under the city’s 16-16-17.5% scenario, in the third year, the city’s public parking revenues would essentially be restored to their previous baseline revenue levels ($10,000 more, actually) – a baseline established over the course of the last six years at a bit less than $3 million total (when the “meter rent” of $2 million, a transfer to the city’s street fund, and two additional parking lots are all factored in). And starting in the fourth year of the contract, the extra revenue would start to compensate for the “shortfall” experienced in the first two years, erasing the cumulative effect of that shortfall between the sixth and seventh years of the contract, generating a total cumulative excess against the baseline of $1.15 million after the ninth year of the contract.

In contrast, the flat-16% scenario would leave a “shortfall” against the city’s baseline until sometime between year six and seven of the contract, at which point the city would start to recover some of the shortfall in previous years, but still with a cumulative deficit of $1.07 million against the baseline over the first nine years of the contract.

That amounts to the difference between a short-term issue and a structural deficit, said Fraser. So on the city’s 16-16-17.5% scenario it would be appropriate to make up the “shortfall” from the undesignated fund reserve. But on the flat-16% scenario, he said he would recommend taking action to deal with the structural issue in the first year it appeared – by eliminating four police or firefighters in FY 2012 to cover the roughly $400,000 “shortfall,” and two police or firefighters in FY 2013.

Parking Revenue: Background – What Is a Shortfall?

It’s worth noting that the city considers its baseline parking revenue (against which it measures a “shortfall” of revenues from the public parking system) to include all transfers made in the last year. Those transfers include two kinds of transfer that date back at least to 2005 – “meter rent” of up to $2 million per year, and a transfer to the city’s street repair fund, which has an escalator, but stands currently around $840,000. The rationale for the street fund transfer is that the city maintains the streets where on-street metered parking is located. The streets are analogous to a linear, roof-less parking structure/lot, so the logic is that the city should receive at least some portion of the meter revenues to maintain the “parking structure.”

Before the meeting, Joan Lowenstein (left), who is current chair of the Ann Arbor Downtown Development Authority board, chats with councilmembers Margie Teall (Ward 4) and Stephen Rapundalo (Ward 2).

During the April 19 council deliberations, Sabra Briere (Ward 1) said that when she heard that the city would be “held harmless” financially in the renegotiation of the new contract, she assumed that the baseline would include the $1 million annual meter rent figure in the old contract, not the maximum $2 million per year allowable. However, Carsten Hohnke (Ward 5) indicated to Briere that there had been a consensus by both the city and the DDA that it was the $2 million figure for meter rent that was the basis of the “hold harmless” assumption.

Another part of the baseline used by the city, but not necessarily by the DDA, is more recent in its history – revenues from the 415 W. Washington Lot and the Fifth & William Lot. In 2009, revenues from those two lots began to be transferred to the city outside the context of the city-DDA contract, and it’s not clear whether it was really considered as part of the “hold harmless” principle in the term sheet that guided the two “mutually beneficial” discussions. [Chronicle coverage for a timeline on those two lots: "City-DDA Parking Deal Possible"]

Revenues from those lots were part of an agreement between the city and the DDA to forestall the installation of parking meters in residential areas near the downtown, which the DDA opposed for a variety of reasons, among them a skepticism they would actually generate the levels of revenue the city was hoping for. [Chronicle coverage: "City to DDA on Meters: We're Skeptical"]

Although she did not try to argue the point at great length during the April 19 deliberations, Sandi Smith (Ward 1), who has also served on the DDA board since 2004, noted that if the $170,000 combined annual revenues from those two lots were left out of the calculation, the city would be held harmless over the life of a 10-year contract. In any case, the expectation was that those revenues were temporary, she said, with the idea that both parcels had a future that was different from a parking lot.

But based on the sentiments eventually expressed around the city council table on April 19, whether revenues from those two lots were part of the “hold harmless” calculation was of little interest to the council. Councilmembers were interested in the percentage of gross that would correspond to the total amount of parking revenue transferred last year – they wanted at least that amount this year, too. And when Marcia Higgins (Ward 4) heard the city’s CFO, Tom Crawford, say that the hold harmless amount would be roughly 19%, she proposed that number for all 10 years of the contract.

Parking Revenue: Council Deliberations – Intro

Higgins’ amendment to the resolution of instruction to the city’s mutual beneficial committee came after lengthy introductory remarks from Christopher Taylor (Ward 3). He set the context of the conversation about the resolution of instruction on the financial side of the contract by describing the progress made in other areas of the contract, contrasting the “narrative” part from the “numerical” part.

As part of that context, he also pointed to the resolution that the council had passed at its previous meeting, which tasked the DDA to lead a process to explore alternate uses for four city-owned downtown surface parking lots. [Chronicle coverage: "Ann Arbor Council Focuses on Downtown"]

Some key non-numerical areas of the contract include:

• Parking rates/hours to be set by DDA. The city council would not have a veto. [Currently the city council holds a veto on rate changes.] The contract stipulates that rates won’t be changed permanently without first: (1) announcing and providing written communication regarding details of the increase at a DDA board meeting; (2) at a subsequent board meeting, providing all members of the public a chance to speak before the DDA board on the matter – a public hearing; and (3) delaying any vote on the rate change until the board meeting following the public hearing.
• DDA to assist with directing parking enforcement. The contract calls for a Standing Committee to be formed that will meet for regular consultation about parking enforcement. The committee will consist of the executive director of the DDA, the parking manager, deputy police chief, community standards supervisor, and the city’s public services area administrator. This addresses the concern expressed by the DDA that while it already had the authority to set hours of enforcement (for example, for later in the evening), it could not actually schedule community standards officers to do the enforcement. [Currently, many downtown parkers pay for meters past 6 p.m. even though the meters aren't currently enforced that late.]
• City to report information to the DDA. The contract would call for the city to provide regular reports on its enforcement activity – data like how many citations have been issued and in which zones. The contract would also call for the city to provide reports to the DDA on its street maintenance activity in the downtown.
• Parking area defined. The contract provides a map designating exactly which areas the DDA has authority to decide placement of parking meters. Not included in the DDA parking area are any of the residential parking permit areas – a program over which the city will maintain its current control.

Later in deliberations, Sabra Briere (Ward 1) drew out for emphasis the fact that it was only the financial terms of the contract that the council was being asked to consider that evening, not the other aspects of the contract. Still, some of those non-financial terms drew criticism from Stephen Kunselman (Ward 3) during his comments, when he indicated that he would not support giving rate-setting authority to the DDA or allowing the DDA to decide to enforce meters in the evening. He also objected to defining a geographic area where the DDA would determine parking policy.

But Taylor began by portraying the DDA as a generous and cooperative party to the discussions on the contract. He said it was not a “commercial negotiation” – if it were, then the city would have been told to “pound sand” long ago, he said. However, the DDA had not behaved that way, said Taylor. He highlighted the fact that last year, the DDA had decided to make a $2 million transfer to the city that it was not required to make under the existing contract. It was a clear example of the DDA’s good faith, he said.

Parking Revenue: Council Deliberations – Interrogatories on Police

Taylor then called the city’s chief financial officer Tom Crawford to the podium, and the two then performed a dialogue that was virtually identical to the one that he and Hohnke had played out with city administrator Roger Fraser a week earlier at the council’s working session. To re-establish the city’s position that its 16-16-17.5% scenario was tenable without service cuts, but that the DDA’s flat-16% would require service cuts, Taylor and Crawford offered the following kind of back-and-forth:

Taylor: So under Ann Arbor’s [the city's] proposal, the revenue shortfall in the first two years is a “one time” occurrence, then it is reasonably anticipated that it would occur and there are no service cuts associated. Under the DDA proposal of a flat 16%, the administrator at our last work session stated that there would be permanent service cuts associated with that. Is that correct?
Crawford: Yes, that would be the recommendation. Because under a 16% flat scenario, even on the 16-16-17.5, in the out years it is a long time before that deficit is actually made up, and that is beyond, it’s assumption upon assumption to actually get that far. So to have a responsible balanced budget, I think you’ve gone too far. You really need to make the cuts if you’re going to be that low and don’t anticipate it being recovered in the near future.
Taylor: Okay, so under the, for colleagues, so under the flat 16[%] that would result in service cuts and the administrator stated his view that it was approximately four [public safety officers] in the first year, because of the $490,000 drop, and then at least two, he said two, I added the “at least,” thereafter going forward?
Crawford: Two to three.

Parking Revenue: Council Deliberations – Fund Balance (Bonds)

The DDA’s board had generally stated, Taylor reported, that its reluctance to adopt the city’s position in the negotiations over the financial terms of the contract was related to their concern about the undesignated fund balance of the DDA. So he then posed a series of questions to Crawford apparently intended to establish: (1) the DDA’s undesignated fund balance is not as important relative to the city’s fund balance; and (2) the reserve fund balances for the DDA on the city’s proposal of 16-16-17.5 would be reasonable, even in the lowest year in the 10-year projections.

Taylor: Okay. The DDA has articulated, the DDA’s description of their lack of comfort with this proposal is based upon what it does to its fund balance. We have stated in the course of our conversations that the city serves as a guarantor of the DDA. And although it’s useful and important for the DDA to maintain some fund balance, that the city serves as its guarantor, so that diminishes the risk of harm to the DDA in the event of a lower fund balance. Is that accurate?
Crawford: That is accurate. In fact the city owns the parking system. And where there has been debt issued on the parking system, the city has issued the debt. And so while the fees from the operation of the decks are the primary source of retiring the debt, the bonds that were issued are capital improvement bonds most recently, and those are in fact guaranteed by the city.
Taylor: Does the DDA fund balance play any role in the determination of Ann Arbor’s bond rating?
Crawford: Not really. The city itself, the DDA is small enough that it really doesn’t, it’s not a material factor, I wouldn’t say.
Taylor: Does the, is the city’s fund balance a material consideration in its bond rating?
Crawford: Yeah. There are many factors. But particularly the general fund balance is something they definitely look at.
Taylor: So if, and this is just for the purposes of fund bal- bond rating, well, why is a bond rating something important to consider?
Crawford: The bond rating, the largest impact of the bond rating financially to the city is in borrowing costs. Your borrowing costs will go up if your bond rating goes down.
Taylor: So if I understand it correctly, then, if we were to privilege the DDA’s fund balance over the city’s fund balance, you know, hold the DDA’s fund balance harmless, or preferred in deference to or over the city’s fund balance, that that at some point, we are not the rating agency, so we don’t know, but at some point that could reasonably be expected to have a negative impact on Ann Arbor’s fund balance [sic]? [Note: Taylor likely meant "bond rating."]
Crawford: Yeah, so to the extent that there is a priority that needs to be given to where fund balance is held, in my view, the city is where the fund balance would need to be maintained. The general fund is a fund that has the ability to transfer monies when it has them available to other funds. It’s not always the case that that can happen in reverse. So it is important to the city have, be healthy.

A few minutes later, mayor John Hieftje and Crawford reprised the same scene about how bond rating agencies evaluate the city:

Hieftje: The other point I wanted to go to, when the bond agencies take a look at who’s qualified and at what interest rate, is their view at the fund balance of the Downtown Development Authority or is their look at the fund balance of the city?
Crawford: The city. They’re evaluating the city.

Parking Revenue: Council Deliberations – Fund Balance (%)

As for the DDA’s fund balance under the city’s desired scenario, Taylor and Crawford seemed interested either in portraying the DDA’s reserves as: (1) adequate on the city’s desired scenario; or else (2) somewhat excessive on the DDA’s desired scenario.

It’s not clear which of those rhetorical points was intended, because Taylor asked for Crawford’s comment on the projected low point of 10.9% fund balance reserve under the DDA’s proposed flat-16% scenario – and the answer seemed to be that what the DDA was proposing wasn’t unreasonable. [When a fund balance is expressed as a percentage, it refers to the balance as a percentage of annual expenses.]

Taylor: … this gets us down from the DDA’s view in the critical year of [FY]15-16 to 10.9%. Is 10.9% a pretty health fund balance, do you think generally for the DDA in these economic times?
Crawford: Fund balance is a gray area, obviously something that people talk about. It’s important, you know each fund has its own characteristics of risk. And so it’s hard to say this is a healthy number or this is not a healthy number. But in my opinion, 10.9 for the risk profile is not unreasonable for that fund. And I say that because when you look at the city’s fund balance policy, which is a range from 8-12[%] and you look at the characteristics of the risk that we have, tax revenues, and then all the fee revenues, state shared revenues, we’re actually in an environment where almost everything is going down. It’s unusual, but it is occurring. In the DDA’s situation, you’re looking at the parking system. The parking system has appeared to be, history would tell us, it’s a fairly stable, more stable revenue source. So certainly expect it to be in that 8-12 range and maybe a little lower.

From later in the exchange between Taylor and Crawford, it appears that 10.9% – from the DDA’s preferred, flat-16% scenario – is still the one they were focused on:

Taylor: Would you have any concerns about the DDA’s fund balance in that critical dip year in the event that we moved to a 16-16-17.5 version?
Crawford: I would want to talk to the DDA more about it. If their plan is 10.9[%] and they’re going to be better than that, then I would not have an issue with that, because as you indicated, it’s my opinion that the TIF [tax increment finance] revenue is conservative in its projection. So no, I don’t have a problem with the 10.9 as it’s projected.

Later in the deliberations, Sandi Smith (Ward 1) focused the conversation on the figure associated with the projected low point for the DDA’s fund balance percentage under the city’s desired contract – the 16-16-17.5 scenario. That number is 7.4%, not the 10.9% that Taylor and Crawford had discussed earlier. She asked Crawford if he really was comfortable with that number. He confirmed that he was, although he allowed that he’d like it to be more – but that the city’s fund balance takes precedence over the DDA’s fund balance.

Smith also asked Crawford to reconcile his statements made around the time the city council was authorizing bonds for the DDA to build the South Fifth Avenue underground parking garage (now under construction) – statements to the effect that a fund balance of 12-15% or perhaps 15-18% would be appropriate. She asked him point blank what the difference was between then and now: What has changed?

Crawford began by saying that he didn’t recall giving the DDA a minimum fund balance that they needed to have. He described it as natural for an organization to save up fund balance reserves for a capital expenditure, then to spend down those reserves for a capital project and possibly dip into the fund balance to a point where it’s not comfortable. He said he didn’t see his comments in 2009 as inconsistent with what he is saying now.

The Chronicle reported Crawford’s comments at the Feb. 17, 2009 city council meeting:

Crawford reported that on looking at the DDA’s financial picture, he noticed that they don’t have a minimum reserve policy. He said he generally used 15-20% as a minimum reserve. In light of the need to maintain adequate reserves, he said that in his view the project is “not affordable with the plans they have.”

A followup email dated March 7, 2009 from then-councilmember Leigh Greden to DDA board members shed additional light on the minimum reserve figure:

I understand there has been some discussion at the DDA that the City does not have a minimum reserve policy similar to the one Tom Crawford has been recommending for the DDA. In fact, the City DOES have a minimum reserve policy, and has had such a policy — in writing – for years. The policy has been printed in the City’s Budget for years, and reads as follows: The City shall “maintain an undesignated General Fund balance with a minimum range of 8% to 12%; provided that when necessary use of these funds occurs, subsequent budgets will be planned for additions to fund balance to maintain this standard over a rolling five-year average.” Tom Crawford has repeatedly urged the City to exceed this policy by maintaining an undesignated General Fund reserve of 15%. Consistent with Tom’s recommendations, the City has exceeded our policy by maintaining an undesignated General Fund reserve of 15-20%.

The on-demand online video archive of CTN recordings no longer includes the Feb. 17, 2009 city council meeting – it existed previously here: [link to Feb. 17, 2009 meeting archive]. According to CTN, some meetings were deleted because of storage-space issues. The Chronicle requested to view a copy of the DVD of the meeting, but according to CTN, as of April 22, staff had not been able to locate the DVD of that meeting – it’s missing from the binder where it was stored. CTN staff continue their efforts to locate it.

Parking Revenue: Council Deliberations – Fund Balance (TIF)

The conversation about the DDA’s fund balance included a focus on the issue of anticipated TIF revenues to the DDA. The TIF (tax increment finance) district of the DDA, in broad strokes, works by capturing property taxes that would otherwise be collected by entities like the city of Ann Arbor, Washtenaw County, the Ann Arbor Transportation Authority, the Ann Arbor District Library, and Washtenaw Community College. The DDA’s capture is only from the value of improvements to properties (hence, the word “increment”) and does not apply to future appreciation on the increased value.

In its 10-year planning, the DDA has typically projected 2% growth in its TIF revenues. It’s also typically added TIF revenues to its 10-year projections only when the taxes are on the books. The Zaragon II and 601 S. Forest projects – primarily residential developments – are under construction in the DDA district:

Taylor: Do the TIF figures for the DDA’s 10-year plan include any monies associated with 601 S. Forest or Zaragon II?
Crawford: Not that I can tell.
Taylor: Do you have any notion as to, well, do you have any notion as to what those properties would gain the DDA in terms of TIF revenue?

Crawford’s recollection given to Taylor was in the ballpark of the exact numbers provided subsequently to The Chronicle by the city treasurer’s office: Zaragon II and 601 S. Forest projects are expected annually to generate $206,391 and $286,645, respectively.

The DDA has also not included TIF revenues in its 10-year projections that the city reports have already been filed with the state of Michigan for FY 2011. Specifically, the DDA’s 10-year plan indicates TIF revenue of $3,796,929 for FY 2011, but according to the city treasurer’s office, $3,908,576 is actually on the books for this year.

And looking ahead to future years, when construction on Zaragon II and 601 S. Forest is completed, that difference will be even greater. The city’s point, essentially, is that the DDA is under-representing in its 10-year plan what it could reasonably anticipate for TIF revenues. In response to Taylor’s prompt, Crawford responded:

Crawford: Off the top of my head, because I did not bring that with me, I believe, you know, I don’t know what year they pulled those, but we are seeing substantially more than that in [FY12]. … So the tax numbers have been close to finalized now, and we are in the neighborhood of $450,000 more, I would say, in this category.
Taylor: Would you believe it if I, well, I , I I, I didn’t remind you to bring this email, but for 411 [Lofts], we’re bringing in $408,000 in FY12, and for Zaragon I there was $271,000 brought in, is that about right? So that’s several hundred thousand dollars that are already in the bank for FY12 that are going to be going forward …

Mayor John Hieftje also stressed that TIF revenue has continued to climb – at double-digit pace in the last three years, while the city’s general fund tax revenue has shown decreases of 1-4% each year. Hieftje had stressed this point at a March 30 meeting of the DDA operations committee (known officially as the bricks and money committee).

Parking Revenue: Council Deliberations – Economic Development

Contrasted with comments y Taylor and Hieftje on increased TIF revenue, remarks by Sandi Smith (Ward 1) focused more on the parking fund within the DDA, as opposed to the overall fund balance of the DDA. The overall fund balance is shored up by TIF-capture revenues from a range of other taxing jurisdictions, not just the city of Ann Arbor’s. [Previous Chronicle coverage on that issue: "City, DDA Continue to Talk Parking, Taxes: It's about parking fund balances, not TIF revenues"]

Sandi Smith (Ward 1) arrives to the April 19 council meeting.

Smith was consistent at the April 19 meeting with a theme she’s highlighted in recent weeks on the use of the parking fund as an economic development tool. She pointed to the Village Green project planned for the First and Washington parcel, saying that if another opportunity like that came along, the DDA would not currently be in a position to take advantage of it. [The DDA has committed to paying back $9 million of bonds for the construction of a 244-space parking deck on the lower two stories of a 9-story, 156 unit residential development. According to Village Green, the purchase option is still on course to be completed this spring. That would result in a $3 million payment to the city of Ann Arbor, which will go into the construction fund for the new municipal center.]

Smith characterized the issue as a difference in philosophy: Is the parking system and its revenue stream an economic development tool, or is it a way to prop up the city’s general fund? She noted that it was particularly important to consider the city’s efforts in support of economic development, in light of the fact that the city’s economic development fund is being eliminated as part of the proposed FY 2012 budget. The remaining money in that fund – established originally in the amount of $2 million to provide monies as an incentive for Google to locate its offices in downtown Ann Arbor – was folded into the general fund reserve.

In responding to Smith’s talk of economic development, Stephen Kunselman (Ward 3) was not saying anything he has not said before: The city is not in the business of economic development – that is Ann Arbor SPARK‘s job, he said. He, as an elected official, is responsible for health, safety and welfare, not economic development, Kunselman said. He thinks of his role as providing good roads, clean water and good public safety.

Stephen Rapundalo (Ward 2) also challenged the notion that the DDA’s mission was economic development, citing the mission statement of the DDA, which refers to supporting public buildings. He remarked that if the mission of the DDA included economic development, then he’d like to see some kind of economic development plan, adding that he’d also like to see some kind of plan from Ann Arbor SPARK.

Smith responded to Rapundalo by pointing out that the second part of the DDA’s mission statement actually includes encouraging private investments:

The mission of the Ann Arbor Downtown Development Authority (DDA) is to undertake public improvements that have the greatest impact in strengthening the downtown area and attracting new private investments.

On the relationship of parking revenues to the city’s general fund, Mike Anglin (Ward 5) was willing to say it out loud: To fund the city’s request for additional parking revenue money, the council was basically asking the DDA to raise parking rates.

Along those lines, during the course of the mutually beneficial committee negotiations, an exasperated Roger Hewitt on the DDA board suggested at one point that the arrangement should simply be year-to-year, and should work on a two-step process each year: (1) The city tells the DDA how much money it would like to take out of the parking system; and (2) the DDA sets rates to generate that amount of revenue. Hewitt also raised the specter of signage on parking meters and parking structures indicating what percentage of a downtown public parking dollar goes to the city’s general fund as a “tax.”

The idea received little traction. At that committee meeting, the DDA’s executive director, Susan Pollay, cautioned that demand for parking was at least somewhat elastic. At some price point, people would begin to seek alternatives to paying for public parking or opt out of visiting downtown Ann Arbor.

During the April 19 council deliberations, Hewitt was invited to the podium to report on the level of parking demand. He told councilmembers that revenues continued to increase, but that the increased revenue over the last two years did not match the increase in parking rates. That could indicate a slight softening of demand.

Parking Revenue: Council Deliberations – Committee’s Role

The city’s mutually beneficial committee had essentially brought two choices on a percentage-of-gross figure to their council colleagues for consideration: (1) a 16-16-17.5% scenario; or (2) a flat-16% scenario. Early in deliberations, it became clear that there was considerable support for a third option, which was for the city’s negotiating committee to return to their DDA counterparts with an escalated offer. Marcia Higgins (Ward 4) began discussion on that figure at 19%.

Met with resistance from members of the city’s committee, Higgins noted at more than one point during deliberations that the purpose of the resolution was for the council to give the committee direction. The committee had come to ask the council for direction, she observed, but the committee responded by saying it was uncomfortable going back with the higher request – she asked if they would really negotiate based on the council’s direction.

Left to right: Ann Arbor Downtown Development Authority board members John Splitt and Roger Hewitt, and the city’s CFO, Tom Crawford.

Higgins’ remarks along these lines were consistent with the theme she’d highlighted at the council’s previous meeting, when it had authorized the DDA to lead a process to explore alternate uses of city-owned downtown surface parking lots. On that occasion, the city’s negotiating committee had resisted other councilmembers’ desire to limit the scope of the DDA’s work to just four of the downtown city-owned properties. Higgins had said the last time she checked, a city council meeting was an opportunity for councilmembers to give their opinions, which was what she was doing.

At the April 19 council meeting, Carsten Hohnke – a member of the committee – responded to Higgins by saying he would debate the percentage figure at that meeting, but once the number was decided, he would negotiate that number.

Taylor’s take on the issue was that he would accept the council’s direction on the matter, but that did not mean he felt it was calculated for wisdom or success.

On the issue of the relationship of the council to its negotiating committee, Sabra Briere (Ward 1) noted that the DDA’s committee had consulted with the entire DDA board multiple times to get explicit direction, but this was the first time the city council had been asked for direction. She said she was sorry that this left the committee with little time to resolve the issue.

By way of logistical background, the respective committees of the city and the DDA are scheduled to meet again on April 25. The full DDA board will meet at noon on May 2 and the council will meet the same day at 7 p.m. The time is the usual one for the council, but the DDA’s meeting was shifted from the following Wednesday, to allow more board members to attend.

The May 2 DDA board meeting will be the last opportunity for the DDA board to alter its already-approved budget, before the city council must approve the city’s budget – at the second meeting of the month, on May 16. The DDA’s approved budget at this point includes a transfer of parking revenues to the city of around $1 million, covering the street repair fund money, and money from two specific parking lots – at 415 W. Washington and Fifth & William.

When the city votes on May 16, it will be giving final approval to the DDA’s budget, which is part of the city’s budget.

Parking Revenue: Council Deliberations – DDA as Arm of the City

The fact that the city council must ultimately approve the DDA’s budget was a point Stephen Kunselman (Ward 3) made during deliberations.

By way of historical background, that approval is not simply a formality – on at least one occasion previously, the council has reached an arm into the DDA’s already approved budget and changed an item on the same night it approved the city’s budget as a whole. From the May 21, 2007 city council minutes [Fund 0003 is the TIF fund]:

[FY 2008 budget] Amendment 11

Resolved, that the Downtown Development Authority fund (0003) expenditure budget be decreased by $1,600,000 to reduce the appropriated reserves for future capital construction projects.

On a voice vote, the Mayor [John Hieftje] declared the motion carried with one dissenting vote made by Councilmember [Joan] Lowenstein.

The possibility that the city council could change the DDA’s budget is affecting how the DDA is currently proceeding with its energy saving grant program. The budget approved by the DDA board includes $100,000 in FY 2012 for that program. But Dave Konkle – former energy manager for the city and now consulting for the DDA on its energy saving grant program – has stressed at recent meetings of the DDA’s partnerships committee that he cannot give assurances to potential grant recipients that the money will be there – until the city council approves the budget.

During deliberations at the April 19 council meeting, mayor John Hieftje reiterated his view, expressed often in various contexts, that the DDA is not an independent body, but rather an arm of the city. At a recent DDA board meeting – the mayor sits on that board – Hieftje compared the DDA to a child, whose parent must co-sign for a loan.

Christopher Taylor (Ward 3) looks on as his ward colleague Stephen Kunselman (Ward 3) weighs in against Taylor’s view that the city should accept a 16-16-17.5% arrangement for a new contract with the DDA.

Kunselman echoed that sentiment, saying that the DDA is like a teenager that needs some tough love. He asserted the primacy of the city council, as elected officials, over the members of the DDA board, which has members who are nominated for appointment by the mayor and confirmed by the council. Kunselman allowed that everyone needed to come together as a team, but he was careful to single out the city councilmembers as the “star players of the team.”

In his assessment of the situation, city administrator Roger Fraser said he was surprised that the council was even still considering “subsidizing” the DDA. The rest of the city’s departments had been skinnied down, he said, yet no one was asking the question of whether we should have “less DDA.”

At one point Taylor noted that the conversation around the table seemed to suggest an assumption that city council could act without the DDA’s assent, which prompted the mayor to interject his disagreement – a breach of parliamentary protocol that appeared to startle Taylor briefly:

Taylor: We are having this conversation as if it is entirely our choice …
Hieftje: … no we’re not!
Taylor: [4-second pause] I understand, uh, I, I, well, it is my perception that that is the nature of this conversation, and I would just recollect to my colleagues that that is not the case …

Parking Revenue: Council Deliberations – 19% Tactic

The opening gambit of a request for 19% of gross parking revenues was based on Crawford’s answer to the question of what the “hold harmless” percentage would be if it were applied to just FY 2012. Marcia Higgins (Ward 4) proposed that as an amendment to the resolution before the council.

She tipped the fact that it was a negotiating tactic, when mayor John Hieftje eventually invited her to reduce the number to 18% in order to achieve a greater consensus. Her reply was that she was “not yet” ready. Only just before the vote on her amendment did she change the figure to 18%, with agreement from Kunselman, who was the seconder on the amendment to 19%.

Other councilmembers, including members of the negotiating committee, expressed concern that 19% was over the top – too far in the other direction. Sabra Briere (Ward 1) noted, however, that if the city’s need is great this year, and if the DDA’s burden to the parking fund is somewhat less this year [because it's using some TIF dollars to shoulder the burden of down payment and bond payments on the underground parking garage], then perhaps the city should be asking for 20% in the initial year, with less in subsequent years.

Parking Revenue: Council Deliberations – 18% Vote

The vote on the amendment of the resolution of instruction to set the percentage-of-gross parking revenue figure at 18% was 8-3. Hohnke – a member of the negotiating committee that had argued for the 16-16-17.5% scenario – joined the majority as the last person to weigh in on the roll call vote.

Dissenting were the other two members of the committee, Teall and Taylor, and Smith, who serves on the DDA board.

Outcome on amendment: The council voted 8-3 to amend the resolution of instruction to negotiate based on an 18% figure across all 10 years of a 10-year contract.

The vote tally on the resolution as amended changed by one from the outcome on the amendment. Teall said that the consensus of the council was clear and that she would thus support the resolution.

Outcome: The council voted to direct the committee to ask the DDA for 18% of gross parking revenues in each year of a 10-year contract. The vote was 9-2, with dissent from Christopher Taylor (Ward 3) and Sandi Smith (Ward 1).

Medical Marijuana

In front of the council for consideration were votes on both the zoning and licensing ordinances that were being considered for their final votes.

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 initial approval to the licensing proposal at its March 21 meeting. [.pdf of Michigan Medical Marijuana Act]

Medical Marijuana: Public Hearings

Two separate public hearings were held – one for the licensing and one of the zoning regulations. Many of the same people spoke at both, and many had spoken previously to the council. Here’s a sampling from both April 19 hearings:

Weighing in against the idea of ordinances that provide a locally legal way for people to gain access to medical marijuana was Thomas Partridge. He called on the council to freeze progress of the ordinances. He pointed to national and state news reports of illegal shipments of drugs and cautioned against the violence that is associated with illegal drugs. He said he was committed to not using illegal drugs. He said that marijuana use is intertwined with other addictive drug uses.

After the public hearing, Dennis Hayes (right) and Thomas Partridge (left) discuss their differing views on medical marijuana.

Countering Partridge was Tim Beck, of the Detroit Coalition for Compassionate Care, who said that in the two years the Michigan Marijuana Law has been in effect, Ann Arbor has not fallen into a wave of crime. On the issue of regulating caregivers, he encouraged the council to “let it ride.” He pointed out that in Grand Rapids, when a similar law was enacted, no one ever applied for a license.

Gersh Avery introduced himself as a resident of Dexter, and founder of the Cannabis Cancer Project – which aims to develop cancer-killing agents from essential oils extracted from the cannabis plant. He claimed some success already, and stressed that the goal is not merely symptom relief, but rather to kill cancer and cure other diseases. He pointed to Crohn’s disease as an example of a category of illnesses that may be responsive to treatment with essential oils. Countering Partridge’s point about addictive behavior, he said that a recent study showed that prescription drugs are five-times more likely to be a gateway drug than marijuana is.

Rhory Gould introduced himself as representing Arborside Health and Wellness. He said the proposed number of 15-20 licenses would not be enough to serve Ann Arbor. He suggested that adding 5-10 more would mean 5-10 more businesses and 30-60 more jobs. He criticized the idea of requiring dispensaries to maintain a permanent list of suppliers, saying it would do more harm than good. He also complained about the length of the proposed moratorium, noting that businesses that began operation before it was imposed and are grandfathered in are happy with it.

Along with several other demonstrators outside city hall before the meeting, Chuck Ream told the council that the regulation of cultivation facilities and the requirement of list-keeping included in the ordinances needs to be removed. He also criticized city attorney Stephen Postema for his handling of the medical marijuana issue.

Postema was also sharply criticized by Trena Moss, who described an encounter with Postema on Liberty Street when she was collecting petition signatures for the medical marijuana referendum. [Postema sometimes walks to work downtown along Liberty Street from his home in the Eberwhite neighborhood.] She asked him if he remembered the encounter, which he apparently did not. She told him that she remembered him well, and reported that he’d told her she was wasting his time – that he and his friends wouldn’t let it pass, even if they collected enough signatures to get the measure placed on the ballot. She asked him if perhaps he had something personal against medical marijuana patients, and that if he did, then he should perhaps step aside.

During council deliberations, Carsten Hohnke (Ward 5) said that Postema had accepted the guidance of the council in working on Ann Arbor’s medical marijuana ordinances.

Dennis Hayes addressed the 1,000-foot setbacks required in the zoning regulations by suggesting either 500 or 200 foot setbacks. He also encouraged the council to consider office districts as allowable locations for dispensaries under the zoning code.

Several speakers, including Matthew Abel, noted that the federal government is interested in getting information about caregivers and patients. Abel also noted that caregivers should be able to grow the amount of marijuana allowable under the state law without restrictions. The only real concern that the council should be addressing in legislation on growing, he said, was the possibility that people could buy houses for the sole purpose of setting them up as “grows.”

Medical Marijuana: Council Deliberations

The number of amendments that had been proposed by councilmembers and the city attorney’s office as late as the afternoon of April 19 led Sandi Smith (Ward 1) to start deliberations with the suggestion that the council delay the votes on both measures until May 2. Smith noted that councilmembers had received the most recent updates in proposed amendments at 3:38 p.m. and 6:29 p.m. that same day – the council meeting’s scheduled start was 7 p.m.

Sabra Briere (Ward 1) said that it was difficult to provide the public with the material that the council would be considering in advance of the meeting, because she’d been told by the city attorney’s office that it had to be vetted by the whole council before it could be shared publicly. Seated next to Briere, city attorney Stephen Postema told her that proposed changes suggested by councilmembers or by others could be shared with the public. She replied: “I was not told that.”

Subsequent back-and-forth among councilmembers, the mayor and the city attorney confirmed that if proposed amendments are passed on May 2, it would likely reset both ordinances to their first readings, which would require that they receive an additional second reading.

In discussing postponement, some councilmembers pointed to specific issues that they wanted to focus on in the postponed deliberations. Christopher Taylor (Ward 3) indicated he was not certain that the proposed legislation yet achieved the goal of providing a “safe harbor” for caregivers.

Carsten Hohnke (Ward 5) and Tony Derezinski (Ward 2) check over the April 19 agenda.

Taylor said that on further reflection, he felt that patients who are availing themselves of the opportunity to gain access to medical marijuana do so with the full knowledge that the product they’re getting has not been certified with the rigor that the federal Food and Drug Administration would apply. So he alerted his colleagues to the idea that he might be more inclined to support some kind of disclaimer

Carsten Hohnke (Ward 5) and mayor John Hieftje responded to the suggestion raised during public commentary that the city attorney or councilmembers had personal issues against marijuana. Hieftje said he would support legalization of marijuana, if a way could be found around the risks posed to young people. Hohnke said his background in neuroscience led him to conclude that the medical benefit of marijuana is well documented.

To prepare for future deliberations, Briere asked her colleagues to reflect on the appropriateness of licensing cultivation facilities. She pointed out that home occupation businesses are not required to be licensed under the proposed ordinances, but cultivation facilities are. The difference, she said, boils down to whether growing by a caregiver takes place in one’s own home or in some other location (making it a “cultivation facility”). She also pointed to a newly proposed amendment, which requires a zoning compliance permit, as potentially posing problems by creating records about caregivers, which the city might be forced to produce, even if the city were to fight a request to produce those records.

Following up on Briere’s remarks, Stephen Kunsleman (Ward 3) gave notice to his colleagues that he would not be supporting the text that refers to zoning compliance permits.

Outcome: The council voted unanimously to postpone deliberations on the zoning and licensing of medical marijuana businesses until May 2.

Interim Administrator

Added to the council’s agenda at the start of the meeting was a closed session to discuss applications that had been solicited internal to the city for the interim city administrator’s job. The section of Michigan’s Open Meetings Act allowing for a closed session under those circumstances reads:

15.268 Closed sessions; permissible purposes. Sec. 8. A public body may meet in a closed session only for the following purposes: …
(f) To review and consider the contents of an application for employment or appointment to a public office if the candidate requests that the application remain confidential. However, except as otherwise provided in this subdivision, all interviews by a public body for employment or appointment to a public office shall be held in an open meeting pursuant to this act.

After the closed session, two items were added to the agenda – one to establish a process for hiring the permanent administrator, and another to appoint an interim. The city’s current administrator, Roger Fraser, announced at the end of February that he would be resigning to take a job with the state of Michigan as a deputy treasurer.

Marcia Higgins (Ward 4) is chair of the search committee, which brought both recommendations to the council. Other members of that committee were: Sabra Briere (Ward 1), Tony Derezinski (Ward 2), Christopher Taylor (Ward 3) and mayor John Hieftje.

Higgins reviewed the search committee’s work over the last few weeks, which included a total of four meetings. The committee’s recommendation was to appoint Tom Crawford as interim city administrator. Crawford currently serves as the city’s chief financial officer.

The job for permanent city administrator will now be posted and advertised. Affion Public will be contracted to assist the city’s human resources department with the search – for a flat fee of $18,000 plus additional travel expenses expected to total less than $25,000. The targeted salary range for recruitment will be $145,000-$150,000.

Affion’s work will begin with a visit to Ann Arbor in the first week of May to meet with councilmembers, city employees, and members of the public to get a clearer idea of the intangible qualities that are desired in an applicant. An ideal timeline would include closing the application window after 30 days, using late May and June to winnow the field and interview candidates, with an offer to be made by July 1. On the ideal timeline, the new administrator would start work on Aug. 1.

Although the city’s public services area administrator Sue McCormick had been widely assumed to be a natural choice for interim, a condition on the interim appointment was that the person would not be a candidate for the permanent job. [Previous Chronicle coverage: "Ann Arbor Fills City Administrator Job"]

Outcome: The council voted unanimously to adopt the hiring process recommended by the search committee and to appoint Tom Crawford as interim city administrator, effective April 28, 2011.

Panhandling Ordinance

In front of the council for consideration was final approval to a revision to the city’s code on disorderly conduct – the part dealing with solicitation, which is more commonly known as panhandling. All ordinances must be approved on two separate votes before the council, the second of which must be preceded by a public hearing. The panhandling ordinance revision received its initial approval from the council at its April 4 meeting.

The revised ordinance prohibits panhandling in one generally-defined additional location (in or within 12 feet of a public alley) and one specific location (within 12 feet of the downtown location of the Ann Arbor District Library.) [.pdf of revisions to existing ordinance as they were drafted at the start of the April 19, 2011 meeting]

The proposal to revise the law grew out of a street outreach task force, which was appointed at the council’s Sept. 20, 2010 meeting and charged with developing cost-effective recommendations for addressing the issue of downtown panhandling and the needs of those who panhandle. [Previous Chronicle coverage: "Ann Arbor Task Force Consults Panhandlers"]

At the council’s March 21, 2011 meeting, the council received a report from two members of the task force – Maggie Ladd, executive director of the South University Area Association, and Charles Coleman, a project coordinator with Dawn Farm. A recommendation contained in the report included revising the city’s ordinance on solicitation to prohibit panhandling in additional locations. [.pdf of street outreach task force report]

Panhandling: Public Hearing

Four people spoke during the public hearing on the ordinance. Thomas Partridge said it was a very curious time to be considering the ordinance – a time when the city, county and state all have budget concerns. He characterized the change in the law as a measure that would “clamp down” on the most vulnerable members of society. He called for postponing the vote, until the sociological and psychological ramifications could be studied on an academic basis. Partridge noted that politicians also ask for handouts when they ask for contributions to their political campaigns.

Bob Dascola introduced himself as the owner of a two-generation family business since 1939 and a board member of the State Street Area Association. He told the council that he had been a member of the last task force that had addressed the issue of downtown panhandling, in 2001-2003. He told the council that they’d identified three kinds of panhandlers: (1) substance abusers; (2) the mentally ill; and (3) opportunists. He said that most of the panhandlers in the area of his barbershop are opportunists. He described the previous ordinance revision as raising the bar for acceptable behavior in the community, and urged support for the current ordinance revision and the other recommendations of the task force.

Bob Dascola (left) and Peter Ludt (right) seated in the audience before the start of the April 19 council meeting.

Ray Detter introduced himself as the head of the downtown citizens advisory council, saying that he’d participated in the previous effort in 2001-2003. He noted that last summer there had been a noticeably worsening situation. He said that a member of the DCAC had walked from her home on East Liberty to the White Market on William, and had been accosted four times by panhandlers. They’d taken up the issue with chief of police Barnett Jones, deputy chief John Seto and Ward 1 representative Sabra Briere. Of the new task force that had been formed out of those communications, Detter joked, “I was on it, but I still say it did an excellent job.”

Detter stressed that no one needs to panhandle due to hunger, given the various resources in the community. He said that almost universally, panhandlers are not homeless. He noted that the recommendation of the task force was to emphasize education of people who might be inclined to give money to panhandlers – the marketing slogan is “Have a heart, give smart.”

Peter Ludt introduced himself as a board member of the State Street Area Association and a member of the street outreach task force. He said he was a manager of a coffee shop on the 300 block of State Street and had resorted to calling the police department about panhandlers on more than one occasion. He affirmed the First Amendment rights of people to panhandle, but also noted that some people feel uncomfortable when they’re solicited. He recognized that with the city’s budget cuts, the beat cops would not be brought back. Most people, he said, don’t know if the activity they are witnessing is illegal. The number one message, he said, is education.

Panhandling: Council Deliberations

Because Sabra Briere (Ward 1), who chaired the task force, had briefly left the table when the council came to the agenda item, mayor John Hieftje filled the time by noting that he was around when the previous task force had been appointed. He told the council that professionals say that giving panhandlers money is not the correct thing to do. He noted that almost all panhandlers are not homeless and that free meals are available three times a day in Ann Arbor. He said that previously the downtown merchants had tried collection boxes placed at cash registers to provide an alternative way for people to give cash.

Andrew LaBarre, new vice president for government affairs for the Ann Arbor/Ypsilanti Chamber of Commerce, before the meeting. A former staffer for Congressman John Dingell, he apologized when he introduced himself to the council for not wearing a jacket. He had locked it inside his new office and was without a key.

Hieftje said that the city respected the right of people to solicit, and he complimented the task force’s work

When she returned, Briere stressed that the ordinance change is just one of three “legs in the stool,” the others being education and community commitment.

Tony Derezinski (Ward 2) said he’d received a lot of communications from constituents about the ordinance, including a long message from a law school student and comments from merchants at a meeting of the Main Street Area Association. He said it would be important to evaluate how well the ordinance is serving its intended purpose.

That same evening, Andrew LaBarre introduced himself to the council as the new vice president of government affairs for the Ann Arbor/Ypsilanti Regional Chamber of Commerce. The chamber is related to the panhandling ordinance inasmuch as the mayor’s downtown marketing task force was tapped by the panhandling task force as leading the educational component of its recommendations. At recent meetings of the council and the DDA board, Hieftje has pointed to the vacancy at the chamber, left by Kyle Mazurek, as the reason that his marketing task force has been on hiatus.

Outcome: The council voted unanimously to give final approval to the ordinance revision.

Former Bessenberg Bindery Site Plan

In front of the council for consideration was a site plan for 215 N. Fifth Ave. – formerly the site of the Bessenberg Bindery, which has moved to the Thomson-Shore Inc. facility in Dexter. The Fifth Avenue property is now owned by Jon and Lisa Rye. Jon Rye, a University of Michigan alumnus, is president and chairman of Greenfield Partners and Greenfield Commercial Credit, both located in Bloomfield Hills.

The plan calls for tearing down the one-story building and constructing a two-story, single-family, owner-occupied house with an attached two-car garage. The entrance will be oriented to the north, and the garage will be accessed from the public alley on the west side of the site. The site is directly north of the Armory condos and south of a two-story residential rental property.

The project requires a site plan because the single-family house is on property that’s not zoned solely for residential purposes. It’s zoned D2 (downtown interface) and is located in the Old Fourth Ward Historic District. The Ann Arbor historic district commission already reviewed the site plan and issued a certificate of appropriateness at its Feb. 10, 2011 meeting. The Ann Arbor city planning commission had given its recommendation for approval of the site plan at its March 15, 2011 meeting.

During the public hearing at the city council meeting, only one person spoke – the architect on the project, Dick Mitchell, of the Ann Arbor firm Mitchell and Mouat. He stressed that the planned design met the requirements of the zoning ordinance with respect to setbacks and height, and had been approved by the city’s historic district commission. The design was also supported by the downtown citizens advisory council, he said. He indicated that he was available for any questions.

Later in the meeting, when the council’s vote was taken, there were no questions or deliberations by the council. Mayor John Hieftje thanked Mitchell for sitting through the meeting, which had included lengthy deliberations on the contract under which the Ann Arbor Downtown Development Authority manages the city’s parking contract.

Outcome: The council voted unanimously to approve the site plan for 215 N. Fifth Ave.

Near North PUD

The council was asked to consider an authorization for revisions to the elevations of the Near North planned unit development (PUD) affordable housing project on North Main Street. The city council originally approved rezoning for the project – a four-story, 39-unit mixed use residential building on a 1.19-acre site – on Sept. 21, 2009.

The changes include modifying the locations where exterior materials – glazing, panelized exterior cladding materials, plus accent materials – will be used. Roof lines have also been proposed, but the building is still under the maximum height permitted. The changes, which were prompted by alterations to the interior layout of the building, were presented to the surrounding neighbors at a meeting on March 17, 2011.

Developer Bill Godfrey of Three Oaks was present at the meeting, but was not asked to the podium to answer any questions from the council.

Outcome: The council voted unanimously to approve the changes to the Near North PUD.

Loan Forgiveness

In front of the council for consideration was approval of a policy that grants to the city administrator the authority to forgive certain loans made by the city on affordable housing units that have affordable housing covenants. The city administrator would need to determine that loan forgiveness is necessary to protect the long-term affordability of the housing, and that loan forgiveness would facilitate the transfer of ownership to other income-qualified purchasers.

The request to have such a policy came from the office of community development. It arose from two recent foreclosures on properties in Stone School Townhomes, one of three housing developments where the city currently has affordable housing covenants. The other two are Ashley Mews and Northside Glen.

When a property is foreclosed, the affordable housing covenant automatically terminates.

Outcome: The council voted unanimously without comment to approve the loan forgiveness policy.

City Energy, Emissions Goals

On the agenda was a resolution setting a goal of reducing greenhouse gas emissions in Ann Arbor’s municipal operations by 50%. The baseline standard for the percentage reduction would be emission levels in 2000, which measured 46,435 tons of carbon dioxide equivalent (CDE). The city’s goal is to achieve the 50% reduction target by 2015. The city’s most recent figures, from 2010, put CDE emissions for municipal operations at 34,445 tons, which is roughly a 26% reduction from 2000 levels.

As part of the same resolution, the council also set a goal of reducing greenhouse gas emissions by 8% throughout the community for the same time period. In 2000, the city estimates the entire city produced 2,087,463 tons of CDE, which has improved little in the most recent year for which figures are available, 2009: 2,054,221 tons.

The resolution also updated goals on renewable energy use. The city had previously had a goal of 20% renewable energy for municipal operations by 2010, which was subsequently increased to 30%. The 20% target was met – when the figure was rounded upward only slightly. The resolution approved on April 19, 2011 reset the goal of 30% renewable energy in municipal operations and 5% community-wide by 2015.

The resolution also directs city staff to consider options to purchase long-term, fixed-rate renewable electricity from Michigan wind turbines.

Outcome: The council voted unanimously without comment to approve the reset goals.

Police Car Purchase

In front of the council for consideration was approval of the purchase of two police cars totaling $54,625 – a Chevy Caprice for $25,604 and a Chevy Tahoe for $29,021 from Shaheen Chevrolet. At the council’s Feb. 22, 2011 meeting, it had authorized the purchase of five police cars – Crown Victoria Police Interceptors – for $20,730 each, a total of $103,650.

But at that meeting, city administrator Roger Fraser had indicated that the city might opt not to purchase all five. From The Chronicle’s report of that meeting: “The city might decide not to buy all five Crown Victorias, and instead purchase a new model that Chevrolet is making available in late summer or early fall, Fraser said.”

The two purchases authorized on April 19 will replace cars under the police union’s contract that stipulates cars cannot exceed 80,000 miles or a six-year life. Adding the Caprice to the Dodge Charger that the department purchased previously will allow the Ann Arbor Police Department to assess how it wants to stock its fleet in the future, given that the Crown Victoria is going out of production. A third option besides the Caprice and the Charger would be whatever model Ford uses to replace the Crown Victoria.

The Chevys that were authorized by the Ann Arbor city council would be purchased under the cooperative bidding programs of the State of Michigan, Oakland County, and Macomb County. Shaheen Chevrolet in Lansing was the lowest bidder under the State of Michigan’s program.

Outcome: The council voted without comment to approve the purchases of the Chevy police cars.

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: Parkinson’s Disease Awareness

Kathleen Russell and others were on hand to receive a mayoral proclamation designating April as Parkinson’s Awareness Month.

Comm/Comm: Volunteer of the Month

John Dentler was honored as volunteer of the month for his service to the Ann Arbor police department.

Comm/Comm: Historical Perspective

In her communications time, Sabra Briere (Ward 1) noted that April 19 is the second night of Passover, which is about liberation through sacrifice. She also noted that on the same day 236 years ago, the first shot in the Revolutionary War was fired at Lexington and Concord. She noted that on that evening the council was engaged in politics. She mused that John and Sam Adams would be surprised, perhaps, at the topics they would be discussing. She figured that Abigail Adams would be pleased that there were women at the table [Briere, Sandy Smith, Margie Teall and Marcia Higgins]. She allowed, however, that they have a long way yet to go.

Comm/Comm: Library Lot

Mike Anglin (Ward 5) noted that the Library Lot request for proposals (RFP) had been put aside, but that the community continues to discuss the issue. He wondered who the stakeholders will be. He noted that some city councilmembers had attended a recent meeting of the city’s Democratic Party club where the issue of the Library Lot had been discussed.

Comm/Comm: What Would Christ Say?

As the only speaker who signed up for public commentary reserved time at the start of the meeting, Thomas Partridge introduced himself as a Washtenaw County and Ann Arbor city Democratic Party member. He called the council’s attention to the fact that April is a particularly prayerful month – the month of Palm Sunday, Good Friday and Easter. He posed the same question that he has during recent weeks at public commentary at a range of different public meetings: What would Christ say? Would Christ fund affordable housing, education, and transportation for the most vulnerable? Partridge declared that he is a Christian and an advocate for seniors, disabled people, children, middle class families, teachers and other public employees. He encouraged people to recall Gov. Rick Snyder.

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 2, 2011 at 7 p.m. in the second-floor council chambers at city hall, 301 E. Huron St. [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 initial approval to the licensing proposal at its March 21 meeting. [.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]

Susan Pollay, left, executive director of the Ann Arbor Downtown Development Authority, with councilmembers Sandi Smith (Ward 1) and Margie Teall (Ward 4, sitting) before the start of the March 21 council meeting. Pollay was distributing copies of the downtown street outreach task force report. (Photos by the writer.)

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

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

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

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

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

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

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

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

Medical Marijuana Licensing

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

Dennis Hayes, who has addressed nearly every meeting of the city council when it has discussed medical marijuana, and councilmember Sabra Briere (Ward 1).

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

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

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

Medical Marijuana Licensing: Public Commentary

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

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

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

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

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

Medical Marijuana Licensing: Council Deliberations

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

Medical Marijuana Licensing – Amendment on Code Section

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

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

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

CHAPTER 95. MEDICAL MARIJUANA LICENSES FOR CULTIVATION FACILITIES AND DISPENSARIES

Postema indicated that he had no problem with the change.

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

Medical Marijuana Licensing – Amendment on License Eligibility

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

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

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

Medical Marijuana Licensing – Amendment on Board Activity

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

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

Outcome: The council unanimously approved the amendment without comment.

Medical Marijuana Licensing – Amendment on Home Occupations

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

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

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

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

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

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

Medical Marijuana Licensing – Amendment on Titling

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

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

Outcome: The council approved the titling of the subsections.

Medical Marijuana Licensing – Amendment on Signage

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

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

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

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

Medical Marijuana Licensing – Amendment on Labeling, Record Keeping

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Medical Marijuana Licensing – Amendment on License Renewal

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

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

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

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

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

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

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

Medical Marijuana Non-Disclosure Policy

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

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

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

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

Non-Renewal and Renewal of Liquor Licenses

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

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

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

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

Applications to MDNRE

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

MDNRE City Applications – Skatepark, Canoes, Boats

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

MDNRE: County Application – Land Acquisition

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

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

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

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

“Transformer Plaza”

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

During a council break, Susan Pollay, executive director of the DDA, shows Sabra Briere her book. (Photo links to close-up of book cover. Kudos to readers who can guess before clicking through what Pollay is reading these days.)

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

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

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

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

Millers Creek

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

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

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

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

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

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

Sakti3 Development District Hearing Set

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

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

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

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

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

City Administrator Hiring Plan

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

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

Marcia Higgins (Ward 4) and Mike Anglin (Ward 5) share a laugh before the March 21 meeting.

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

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

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

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

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

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

Schedule Change for Passover

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

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

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

Council OKs Property Transfer to Avalon

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

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

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

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

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

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

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

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

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

Communications and Comment

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

Comm/Comm: 415 W. Washington Update Scheduled

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

Comm/Comm: Increased Public Accessibility for Meetings

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

Community Television Network

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

Comm/Comm: DDA-City

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

Comm/Comm: Labor Report

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

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

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

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

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

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

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

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

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

Comm/Comm: Digital Cities Award

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

Though it's not part of his day-to-day responsibilities as head of the city's IT department, Dan Rainey was wrangling cable at the start of the city council meeting. The meeting was held at the Washtenaw County administration building boardroom, where council is meeting temporarily due to renovations at city hall.

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

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

Comm/Comm: Police Incident

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

Comm/Comm: Palestine

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

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

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

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