The council’s first meeting after adopting the budget for fiscal year 2015 – which was approved on May 19, 2014 – features a housekeeping adjustment for the current year’s budget, so that expenditures don’t exceed allocations.

The sign on the door to the Ann Arbor city council chamber includes Braille.

But the June 2 meeting agenda is dominated by items related to the physical attributes and layout of the city. Several items deal with city-owned physical assets, while several more involve land use and planning.

Possibly one of the more controversial agenda items related to physical infrastructure – and future development in the city – is a contract extension with CDM Smith Inc. for work related to the city’s footing drain disconnection (FDD) program. While the city council suspended the program in certain areas of the city in 2012, it continued in other areas, backed by the city’s ordinance under which the city can require residents to disconnect their footing drains from the sanitary sewer system.

Also not suspended was the city’s developer offset mitigation program, which requires developers to offset the increased flow from new construction into the sanitary sewer system. The vote on the CDM Smith Inc. contract extension was postponed from the council’s May 5 meeting. The dollar amount of the contract extension has been substantially reduced in the meantime – from about $750,000 to $143,000.

Part of the backdrop of the CDM Smith contract extension is a lawsuit that’s been filed against the city, challenging the legal foundation of the footing drain disconnect ordinance. The city sought to remove the case from state court to the federal system, but at a hearing on the matter this week, a federal judge indicated he’d be remanding the case back to the Washtenaw County 22nd circuit court.

City assets on the June 2 agenda include trees – as the council will be asked to approve the city’s urban and community forest management plan. The council will also consider a resolution on the city’s possibly most recognizable asset – the city hall building. The resolution would remove a $4 million renovation of city hall (a “reskinning”) from the city’s capital improvements plan for 2017 and 2018. This resolution was postponed from the council’s May 19 meeting.

Another city-owned asset on the agenda is the Library Lane underground parking garage. The council has already directed the city administrator to engage a real estate broker to test the market for the development rights for the surface of the garage. The resolution on the June 2 agenda, which was postponed at the council’s April 7 meeting, would set a policy to deposit 50% of the net proceeds from the sale of the development rights into the city’s affordable housing trust fund.

Land use and planning items on the June 2 agenda include a roughly $300,000 contract for study of the State Street transportation corridor. Related to transportation infrastructure, the council will also be asked to approve resolutions that move along the process of special assessing property owners on Stone School Road for the cost of installing a sidewalk on the west side of the road in connection with a road reconstruction project.

Also related to land use, three Ann Arbor housing commission properties will be given initial consideration for rezoning. A site plan and associated rezoning for the Delta Gamma house will be given final consideration. Also up for final consideration is a revision to the ordinance regulating drive-thrus. Councilmembers will also consider the site plan for a new Ruth’s Chris restaurant to be located downtown on South Fourth Avenue.

A rate increase for Ann Arbor water, sewer and stormwater rates is on the June 2 agenda for final approval.

Two items connected to parks and recreation appear on the agenda. One is approval of the receipt of funding for a program that helps Bridge cardholders purchase local produce at the farmers market. The second item is approval of a five-year agreement with the Community Action Network to continue operating the city’s Northside and Bryant community centers.

The council will also be considering a resolution in support of the local development finance authority’s application to the Michigan Economic Development Corp. for a possible 15-year extension of the arrangement under which the LDFA captures taxes. The captured taxes are used to fund a business accelerator that’s operated by Ann Arbor SPARK through a contract with the LDFA. Without an extension, the LDFA would end in 2018.

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

The Chronicle will be filing live updates from city council chambers during the meeting, published in this article below the preview material. Click here to skip the preview section and go directly to the live updates. The meeting is scheduled to start at 7 p.m. at city hall, 301 E. Huron.

Amend Current Year’s Budget

On June 2 the council will consider a resolution amending the current fiscal year’s budget (FY 2014) to ensure that expenditures do not exceed appropriated amounts. The budget amendment will ensure compliance with Public Act 621 of 1978.

The total requested general fund budget amendment is $60,000. For all other funds, the amendment to be considered by the council on June 2 totals $310,000.

The non-general fund amount will cover right-of-way maintenance and purchase of materials that were necessary to deal with the severe winter weather. The general fund amount was the city’s cost for the Ann Arbor Area Transportation Authority’s special election held on May 6. That amount will eventually be reimbursed by Washtenaw County – which in turn will receive reimbursement from the AAATA to cover the roughly $100,000 cost of the election.

FDD Program Contract Extension

A contract extension with CDM Smith Inc. for continued work as part of Ann Arbor’s footing drain disconnection (FDD) program appears on the June 2 agenda. It had been postponed at the council’s May 5, 2014 meeting.

In the interim, the dollar amount of the contract extension has been reduced from $748,106 to $143,440. That reflects a reduction in the scope of the work. The original May 5 resolution called for the following activities to be funded: citizen support ($36,928); FDD citizens advisory committee meetings ($24,180); information management for sump pump monitors ($93,707); developer offset mitigation (DOM) program support; ($95,213); and multi-family FDD implementation ($498,005).

No longer a part of the scope of work in the revised June 2 resolution are the FDD citizens advisory committee meetings, information management, or the multi-family FDD implementation. The revised memo describes how the funding would only provide a bridge until recommendations from a study group have been received, which will determine the future of the FDD program:

This amendment would provide the services needed to bridge the gap until the SSWWE [Sanitary Sewer Wet Weather Evaluation] Project recommendations have been made. Presently, the anticipated timeline for completion of the SSWWE Project is in the autumn of 2014. That does not allow sufficient time to issue a new RFP, collect and review proposals, award a contract, and bring a new consultant up to speed to manage the remaining FDD and DOM work outlined above. Existing City staff does not currently have the available resources or expertise to perform the inspections required for the DOM program.

By way of additional background, in 2012 the city’s program to disconnect footing drains from the sanitary sewer system was suspended by the council in some areas of the city. Specifically, it was suspended in the Glen Leven and Morehead (Lansdowne neighborhood) areas. The program was allowed to continue in other geographic areas and as part of the city’s developer offset mitigation (DOM) program. The DOM requires owners of new developments to complete a certain number of FDDs to offset the additional flow in the sanitary system caused by new construction.

The CDM contract drew scrutiny at the May 5 meeting because the city is currently undertaking a sanitary sewer wet weather evaluation (SSWWE) study. It’s supposed to yield a recommendation about whether to continue with the FDD program, and if so, in what form. In addition, the city’s ordinance – which requires property owners to undertake FDDs – was challenged in a lawsuit filed earlier this year. That case is pending as the city first removed the case from state to federal court. But the result of a May 28 hearing before a federal judge will be to return the case to the Washtenaw County 22nd circuit court.

The previous three iterations of the CDM contract totaled  about $3.6 million. The money for these contracts is drawn from the city’s sewer fund.

The proposed contract extension drew criticism during public commentary on May 5 from Frank Burdick, a Ward 4 resident who urged the council to reject it. Council deliberations on this item were included as part of The Chronicle’s live updates from the May 5 meeting.

Since the FDD program’s start in 2001, about 1,834 footing drains have been disconnected through the city program and 848 footing drains have been disconnected through the developer offset mitigation program.

Animation of contrast between the pre-FDD configuration and the post-FDD configuration. (Original illustration from screenshots of YouTube video by Milwaukee Metropolitan Sewerage District, modified by The Chronicle.)

Urban Forest

The city’s first comprehensive plan for managing Ann Arbor’s urban forest will be considered at the council’s June 2 meeting. The Ann Arbor park advisory commission recommended adoption of the plan at its meeting on April 15, 2014. [.pdf of Urban & Community Forest Management Plan]

An urban forest is defined as all the trees, shrubs and woody vegetation growing along city streets, in public parks and on institutional and private property. In Ann Arbor, about 25% is on public property, with 75% on private property. Based on a U.S. Dept. of Agriculture Forest Service i-Tree Eco Analysis done in 2012, Ann Arbor’s urban forest has an estimated 1.45 million trees. It creates a 33% tree canopy – the layer of leaves, branches and stems of trees that cover the ground when viewed from above.

The city manages 43,240 street trees and about 6,900 park trees in mowed areas. A tree inventory conducted in 2009 didn’t include natural areas, she noted, so there are thousands of trees that aren’t counted. The urban forest includes over 200 species, representing 82 genera.

Map of selected tree variety by The Chronicle from city of Ann Arbor 2009 survey. Image links to dynamic map hosted on geocommons.com

PAC had been briefed on the 135-page Urban & Community Forest Management Plan at its Feb. 25, 2014 meeting by Kerry Gray, the city’s urban forest & natural resources planning coordinator. The management plan includes 17 recommendations, listed in priority based on community feedback for implementation. Each of the 17 recommendations includes action tasks and implementation ideas, case studies, and resources that are needed, including funding. The recommendations are:

1. Implement proactive tree maintenance program.
2. Strengthen tree planting and young tree maintenance programs.
3. Monitor threats to the urban and community forest.
4. Increase landmark/special tree protections.
5. Secure adequate city‐funding for urban forestry core services.
6. Develop street tree master plans.
7. Pursue grant and philanthropic funding opportunities.
8. Strengthen forestry related ordinances.
9. Update tree inventory and canopy analysis.
10. Develop urban forest best management practices.
11. Increase urban forestry volunteerism.
12. Strengthen relationships with outside entities who impact trees.
13. Implement community outreach program.
14. Obtain the best use of wood from removed trees.
15. Create city staff working groups to coordinate projects that impact trees.
16. Engage the city’s Environmental Commission in urban and community forestry issues.
17. Review the urban forest management plan periodically and update as needed.

The city council has adopted a budget for FY 2015, which starts July 1, 2014 that includes a one-time expenditure of $1 million to address the backlog in maintenance of trees in the public right of way.

Included in the focus of the effort to remove the backlog are trees classified as Priority 1 removals (red dots), Priority 2 removals (yellow dots), Priority 3 removals (blue dots) for large trees and Priority 1 prunings (green dots). [Map by The Chronicle with data from the city of Ann Arbor.]:

City Hall Reskinning

At its June 2 meeting, the council will consider a proposal to recommend to the planning commission that the capital improvements plan (CIP) for FY 2017 and FY 2018 be revised to remove the $4.4 million that is included for a city hall reskinning project. The planning commission is the body that approves the CIP. But the council has budgetary discretion to fund projects in the CIP or not – so the resolution in some sense calls on the planning commission to take an action it does not have the authority to execute. This was a point made during deliberations at the council’s May 19, 2014 meeting when the item was postponed.

According to a staff memo written in response to a councilmember question, reskinning of the Larcom City Hall building would mean replacing the existing exterior walls and windows of the building. The result would be new squared-off exterior, eliminating the inverted pyramid design. The new exterior would hang vertically from the sixth floor.

The focus of the project is on improving energy efficiency. The memo describes existing windows as mostly single-pane glass on aluminum frames, which offer little insulation value. The project would also result in an incremental gain in square footage – because the lower floors would have the same footprint as the sixth floor, which is currently the largest floor of the building. The materials used for the exterior would “blend better” with the recently constructed Justice Center, which adjoins city hall.

Library Lot Sale Proceeds

On June 2 the city council will consider a resolution setting a policy for distribution of the proceeds from the sale of development rights on the Library Lot. The proposed policy would set aside 50% of the net proceeds to the city’s affordable housing trust fund.

The council has already directed the city administrator to hire a real estate broker to explore selling the rights to develop the site – above the Library Lane underground parking structure, which was completed in 2012.

The item was postponed at the council’s April 7, 2014 meeting. The vote was 6-5 to postpone, with dissent from Sabra Briere (Ward 1), Christopher Taylor (Ward 3), Margie Teall (Ward 4), Chuck Warpehoski (Ward 5), and mayor John Hieftje.

State Street Transportation Corridor Study

The June 2 agenda includes a resolution for a $299,911 contract with Parsons Brinckerhoff Michigan Inc. to conduct a study of the South State Street transportation corridor. The 1.3 mile long area of the study extends from the intersection of Ellsworth Road and South State Street north to the intersection of Oakbrook Drive and South State Street. The money to pay for the study will be drawn in equal parts from the current fiscal year and next year’s general capital fund budget. The study will take a year, starting in June 2014.

The goal of the study is focused on transportation needs in the corridor and to provide base conceptual engineering plans for the redesign of the corridor – possibly including a boulevard “Complete Street” design. The redesign would be intended to “address all modes of travel; enhance vehicle flow; improve safety; create an aesthetically pleasing entrance to the City; and, utilize sustainable concepts such as low impact design (‘LID’), and low energy use lighting.”

The study of the area as a transportation corridor comes not long after a recently completed South State Street corridor plan, adopted by the city council into the city’s master plan at its July 15, 2014 meeting. That corridor plan established planning objectives for the land use along the corridor.

Besides Parsons Brinckerhoff, the other bidder for the work was DLZ.

Stone School Road Sidewalk Special Assessment

As part of a road reconstruction project for Stone School Road, the city is planning to install a sidewalk on the west side of the road. To fund the sidewalk construction, part of the cost will come from a special assessment of property owners. The extent of the project on Stone School Road runs from I-94 to Ellsworth Road. Construction is planned for the project during the 2014 and 2015 construction seasons.

The project is being funded in part through a federal surface transportation grant, which can pay about 80% of construction costs, but not engineering, testing or inspection costs. The total project cost is roughly $128,500, of which about $55,000 will be special assessed.

The council will be asked to approve a resolution directing the city assessor to set the roll of properties to be assessed.

Rezoning: Housing Commission Properties

At its June 2 meeting, the city council will consider giving initial approval to the rezoning of three Ann Arbor Housing Commission properties. The planning commission had recommended the rezoning at its May 6, 2014 meeting. The current PL (public land) zoning for some of the properties is a vestige of the AAHC properties’ status as city-owned land. The city council approved the transfer of deeds to the AAHC at its June 2, 2013 meeting. The three sites to be considered on June 2 are part of the housing commission’s major initiative to upgrade the city’s public housing units by seeking private investors through low-income housing tax credits.

Rezoning is recommended for the following public housing sites, two of which are currently zoned as public land:

• Baker Commons: Rezone public land to D2 (downtown interface). The 0.94-acre lot is located at 106 Packard Street, at the intersection with South Main, in Ward 5. It includes a 64-unit apartment building.
• Green/Baxter Court Apartments: Rezone public land to R4A (multi-family dwelling district). The 2-acre site is located at 1701-1747 Green Road and contains 23 apartments in four buildings and a community center. It’s in Ward 2.
• Maple Meadows: Currently zoned R1C (single-family dwelling district), the recommendation is to rezone it as R4B (multi-family dwelling district). The site is 3.4 acres at 800-890 South Maple Road and contains 29 apartments in five buildings and a community center. It’s located in Ward 5.

At the planning commission’s May 6 meeting, AAHC director Jennifer Hall explained that PL zoning doesn’t allow housing to be built on it. As AAHC seeks private funding to rehab its properties, it needs to ensure if a building burns down, for example, it could be rebuilt. In general that’s why the rezoning is being requested. It’s also being requested to align the zoning with the current uses of the property. She stressed that the highest priority properties to be rezoned are Baker Commons, Green/Baxter and Maple Meadows, because investors have already been found to renovate those sites.

For these three sites, planning commissioners also voted to waive the area plan requirements for the AAHC rezoning petitions, because no new construction is proposed and surveys of the improvements have been provided.

For additional background on the AAHC process of renovating its properties, see Chronicle coverage: “Public Housing Conversion Takes Next Step.”

Delta Gamma Site Plan, Rezoning

The city council will be asked on June 2 to give final approval of a rezoning request for 515 Oxford, to convert a house for use as an annex to the Delta Gamma sorority. The main sorority house is located nearby at 626 Oxford. The council gave initial approval to the rezoning at its May 5, 2014 meeting. Also on the June 2 agenda is consideration of the site plan approval for the same project. The site plan was recommended for approval by planning commissioners on April 15, 2014.

Aerial view showing the location of 515 Oxford, south of Geddes and at the eastern end of South University.

The rezoning request, recommended by the planning commission on Jan. 23, 2014, is to rezone the parcel from R4A (multi-family dwelling) to R2B (two-family dwelling and student housing). Most of the surrounding parcels are zoned R2B, although the site immediately to the north is also zoned R4A. Also nearby is public land (PL) where the University of Michigan’s Oxford Houses complex is located.

The two-story house at 515 Oxford includes two one-story wings. It is currently a rental property with three units – a studio apartment, one-bedroom apartment, and four-bedroom apartment – and a maximum occupancy of 8 people. One of the units is in a former garage.

The proposal for a renovation would accommodate a maximum of 20 residents, including a required resident manager.

The building is notable because it was originally designed in 1940 by architect George Brigham, who used it as his home and architectural studio. He designed over 40 houses in Ann Arbor, including many in Arbor Hills and Barton Hills between 1936 and 1958.

Drive-Thru Ordinance: Final Approval

On the city council’s June 2 agenda is final approval of amendments to Ann Arbor’s zoning ordinance related to drive-thrus. Initial approval came at the council’s May 5 meeting. The amendments would add a definition of a “drive-thru facility” to Chapter 55 of the city code. Currently, the term used throughout the code is “drive-in,” which is not explicitly defined in the code.

The proposed revisions define a drive-thru in this way: “Any building or structure, or portion thereof, that is constructed or operated for the purpose of providing goods or services to customers who remain in their vehicle during the course of the transaction.” The revisions also clarify that a drive-thru is an accessory use, not the principle use of the building. A project in which a drive-thru would be the principle use would not be allowed. Basic layout requirements would also be added to the ordinance.

In addition, the changes would require drive-thrus to obtain special exception use permits, which would be allowed only in the O (office), C2B (business service) and C3 (fringe commercial) zoning districts. Drive-thrus would not be allowed in the C1, D1, D2, and other commercial districts.

Currently, drive-thrus are allowed in C3 districts without a special exception use. They are allowed as special exception uses in the C2B district.

When considering whether to grant a special exception use – which does not require additional city council approval – the planning commission considers these issues:

1. Is the location, size and character of the proposed use compatible with the principal uses of the district and adjacent districts? Is it consistent with the Master Plan? Is it consistent with the surrounding area? Will it have any detrimental effects to the use or value of surrounding area, or the natural environment?

2. Is the location, size, character, layout, access and traffic generated by the use hazardous or inconvenient or conflicting with the normal traffic of the neighborhood? Is off-street parking safe for pedestrians? Do the necessary vehicular turning movements block normal traffic flow? Are any additional public services or facilities needed by the use, and will they be detrimental to the community?

3. Is the maximum density and minimum required open space at least equal to the standards normally required by the Zoning Ordinance for the district?

The planning commission recommended the changes at its April 1, 2014 meeting.

The proposed amendments were first reviewed by the commission’s ordinance revisions committee in 2007, but never moved forward to the full commission for consideration. The ORC most recently reviewed these changes in March of 2014. [.pdf of staff memo and proposed amendments]

Ruth’s Chris Site Plan

The site plan for a new Ruth’s Chris Steak House on Fourth Avenue in downtown Ann Arbor is on the June 2 agenda for consideration. The planning commission recommended approval at its April 1, 2014 meeting.

Proposed facade of Ruth’s Chris Steak House at 314 S. Fourth Ave.

The site plan calls for renovating the single-story building at 314 S. Fourth Ave. and putting up a 1,943-square-foot second-floor mezzanine addition over the front part of the existing building. The current structure is 8,024 square feet, and most recently housed the Dream Nite Club, which closed in 2012. The project is estimated to cost $2.2 million. [.pdf of staff report on Ruth's Chris site plan]

Part of the planning commission’s discussion focused on whether there might be outdoor dining in front of the restaurant. The project’s architect indicated that at this point, outdoor seating wouldn’t be appropriate, in part because of bus traffic. The building is located near the Blake Transit Center, a hub for public transportation. The architect also indicated that the restaurant will be using valet parking, with valets positioned in front of the building.

This would be the first Ruth’s Chris Steak House in Ann Arbor. The chain is based in Florida, with locations nationwide.

Utility Rates

The council will consider giving final approval to higher utility rates – for water, sewer and stormwater. Initial approval came at the council’s May 19 meeting.

Water rates will increase across all tiers of consumption. For the first 7 “units” of water, the charge is will increase from $1.35 to $1.40. For the next 21 units, the charge is proposed to increase from $2.85 to $2.96 per unit. And for the 17 units after that, the increase is proposed to be from $4.88 to $5.08. A unit is 100 cubic feet, which is 748 gallons.

Sewer rates will increase from $3.65 to $3.85 per unit. And stormwater fees would increase for all tiers of impervious service. For the middle tier – for more than 2,187 square feet but less than or equal to 4,175 square feet – on a quarterly basis, the increase would be from $24.85 to $26.32.

According to the staff memo accompanying this agenda item, the recommended rate changes in water, sewer, and stormwater would increase revenues to the water, sewer, and stormwater funds by $765,119, $1,171,931 and $410,235 respectively. The reason given for the rate increases is to cover maintenance and debt payments, and to maintain funding for capital improvement requirements. The city calculates the impact to be an additional $6.25 per quarter or $24.98 per year for an average consumer, which is a net increase of 4.2%.

Water consumption for a typical single family is assumed at 19 units per quarter.

History of city of Ann Arbor water rates. The city converted to a tiered system 10 years ago in 2004, based on usage. The 2015 amount is proposed.

Grant to Farmers Market for Food Stamp Recipients

At its June 2 meeting, the city council will consider approval of an agreement with the Fair Food Network to continue administering the Double Up Food Bucks program at the Ann Arbor farmer’s market. Approval would entail acceptance of $32,000 in funding.

The Double Up name stems from the fact that it provides a match of up to $20/person/day for people using SNAP (Bridge cards/EBT/food stamps) to purchase Michigan-grown produce at farmers markets in Michigan.

The city of Ann Arbor has received Double Up Food Bucks grant funding since 2010.

Partnership with Community Action Network

A proposal for a five-year partnership with the nonprofit Community Action Network is on the June 2 agenda. The partnership was recommended for approval by the Ann Arbor park advisory commission at its May 20, 2014 meeting.

The agreement would be for CAN to continue operating the city’s Bryant and Northside community centers, which the nonprofit has been managing since 2008. The proposed amount is not to exceed $130,000 annually – an increase of $25,000 from the current agreement. The higher amount is included in the FY 2015 general fund budget for parks and recreation that the city council approved on May 19. According to a staff memo, the higher amount will address increases in fixed costs and “assist in retaining quality staff that is at the core of the services that CAN provides.” [.pdf of staff memo]

The staff memo also noted that a request for proposals (RFP) was not issued for this work, because CAN has been the sole respondent to the previous two RFPs and the city is satisfied with its work.

During the May 20 PAC meeting, CAN received praise for their work from several commissioners and Colin Smith, the city’s parks and recreation manager. CAN executive director Joan Doughty and deputy director Derrick Miller were on hand to answer questions. Part of the discussion focused on CAN’s exemption from the city’s living wage requirement, which the city council granted in 2012 for a three-year period through Nov. 8, 2015. Doughty noted that the exemption was sought in part because CAN was paying a living wage to part-time employees who were high school or university students, which limited the nonprofit from paying higher wages to full-time workers. She also pointed out that the city parks and recreation unit isn’t required to pay the living wage to its seasonal workers.

LDFA Extension

On the council’s June 2 agenda is an item that would express city council support of the local development finance authority’s application to the Michigan Economic Development Corp. to extend the life of the tax capture arrangement for up to 15 years. Without an extension, the LDFA would end in 2018.

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

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

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

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

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

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

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

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

4:07 p.m. The public speaking line-up for reserved speaking slots is now available on the agenda. Four people are signed up to talk about the policy for distributing proceeds from the sale of the development rights to the Library Lane site: Amanda Carlisle, Jean Carlberg, Jim Mogensen, and Seth Best.

Two people are signed up to talk about the routine adjustment to the city’s budget for the current fiscal year: Thomas Partridge and Jeff Hayner. Two people are signed up to talk about the resolution supporting the LDFA application for a 15-year extension: David Jsa and Gregg Hammerman.

Signed up to talk about the footing drain disconnection contract with CDM Smith is Frank Burdick. And Henry Herskovitz is signed up to talk about Israel’s attack on the USS Liberty in 1967. Signed up as an alternate speaker on the topic of engine powered heating is Kermit Schlansker.

5:08 p.m. Staff responses to councilmember questions about agenda items are now available: [.pdf of staff responses]

6:33 p.m. Council chambers are set up with the dividers already moved back to create more room and about 40 additional folding chairs are set up. The item involving the policy on the proceeds from the sale of development rights for the Library Lane lot is expected to draw a large number of people. About a dozen people have already arrived.

6:42 p.m. Jack Eaton (Ward 4) is the first councilmember to arrive. Two dozen people now in the audience in support of affordable housing. They include former councilmember and planning commissioner Jean Carlberg, who has signed up to speak during public commentary. Round yellow sticker read “Homes for the Homeless Now!”

6:49 p.m. Sally Petersen (Ward 2) has arrived. She’s talking to people in the audience, which now numbers about 40 people.

6:53 p.m. Jane Lumm (Ward 2) has arrived. She’s chatting with Paul Fulton of the city’s IT services staff.

6:54 p.m. Mayor John Hieftje has arrived. He’s chatting with Jack Eaton. City attorney Stephen Postema is here.

6:54 p.m. Jim Mogensen has arrived. He’s signed up to speak tonight on affordable housing.

6:54 p.m. Pre-meeting activity. The scheduled meeting start is 7 p.m. Most evenings the actual starting time is between 7:10 p.m. and 7:15 p.m.

7:01 p.m. Remaining councilmembers are starting to filter in. Stephen Kunselman (Ward 3) is here. Chuck Warpehoski (Ward 5), Sabra Briere (Ward 1) and Sumi Kailasapathy (Ward 1) have also arrived.

7:02 p.m. City administrator Steve Powers is here, along with the city clerk, Jackie Beaudry.

7:06 p.m. Not yet here are Mike Anglin (Ward 5) and Christopher Taylor (Ward 3).

7:06 p.m. Ann Arbor SPARK CEO Paul Krutko has arrived. He’s talking to John Hieftje.

7:09 p.m. Call to order, moment of silence, pledge of allegiance. We’re off.

7:10 p.m. Roll call of the council. Taylor, Anglin and Margie Teall (Ward 4) are absent.

7:10 p.m. Hieftje reports that Teall and Taylor will likely be along later. Anglin, however, is sick.

7:12 p.m. Approval of the agenda Eaton moves the closed session to just before DS-1 – that’s the footing drain disconnection contract with CDM Smith.

7:12 p.m. The council has approved the evening’s agenda.

7:12 p.m. Communications from the city administrator.

7:13 p.m. City administrator Steve Powers is ticking through some upcoming events, including his favorite – Red Fish, Blue Fish, which teaches kids how to fish. It’s on June 8 from 9:30 to 11 a.m. at the Gallup Park livery.

7:13 p.m. Hieftje says Petersen represented the city well in the half-marathon of the Dexter-Ann Arbor Run that was held on Sunday, June 1. [She ran a sub-2-hour race.]

7:13 p.m. Proclamation honoring the University of Michigan International Center as volunteer of the month. The proclamation honors students, scholars and families affiliated with the center who have volunteered their service in city parks.

7:16 p.m. Public commentary. This portion of the meeting offers 10 three-minute slots that can be reserved in advance. Preference is given to speakers who want to address the council on an agenda item. [Public commentary general time, with no sign-up required in advance, is offered at the end of the meeting.]

Four people are signed up to talk about the policy for distribution of proceeds from the sale of the development rights to the Library Lane lot: Amanda Carlisle, Jean Carlberg, Jim Mogensen, and Seth Best.

Two people are signed up to talk about the routine adjustment to the city’s budget for the current fiscal year: Thomas Partridge and Jeff Hayner. Two people are signed up to talk about the resolution supporting the LDFA application for a 15-year extension: David Jsa and Gregg Hammerman.

Signed up to talk about the footing drain disconnection contract with CDM Smith is Frank Burdick. And Henry Herskovitz is signed up to talk about Israel’s attack on the USS Liberty in 1967. Signed up as an alternate speaker on the topic of engine powered heating is Kermit Schlansker.

7:19 p.m. Amanda Carlisle is executive director of the Washtenaw Housing Alliance. That’s a coalition of more than 30 organizations working to end homelessness, she says. She invites people to stand if they’re here to support affordable housing. [Just about everyone in the center section and the additional chairs set up is standing is support.]

Carlisle says she visited people living under bridges last week, not a mile away from where she’s standing – and they need housing, she says. We can’t rely on state and federal funding, she says, so we need to find local solutions. She’s calling for support of DC-1, a resolution that would allocate 50% of the proceeds from the sale of development rights for the Library Lane lot to the city’s affordable housing trust fund.

7:22 p.m. David Jsa is a web developer and chief technology officer at Seelio. About 2.5 years ago, that company was invited into SPARK’s incubator – a company of four people. They were barely going to make it, he said. But they’ve now grown to a company of 15 employees. So they’ve moved into a larger office space. They’re indebted to the LDFA SmartZone and SPARK for helping the business grow. He says they expect to add around another 20 people. They love Ann Arbor and love to tell stories about how great a place Ann Arbor is to start up a company. He refers to people to the services his company received from the LDFA. He supports the extension of the term for the LDFA SmartZone.

7:25 p.m. Jean Carlberg is a former city councilmember and former city planning commissioner. She says she’s been working on affordable housing and housing for the homeless for 30 years. It’s not often you get a chance to put a “pile of money” to put into the affordable housing trust fund, she says. Affordable housing is at best a break-even proposition, she says. There are over 4,000 who need assistance in one year, she says. Councilmembers have all said they think that affordable housing is critical to the community, she notes. Carlberg urges the council to take the step of putting the proceeds from the Library Lane development rights into the affordable housing trust fund. She calls it a rare opportunity. Their actions should match their values and the values of the community, she says.

7:28 p.m. Jim Mogensen is speaking on the Library Lane resolution. He’s speaking for Religious Action for Affordable Housing. Back in the 1990s, one of the subgroups was looking for additional funds. That’s why RAAH was set up, he explains. They’ve raised about a half-million dollars, he says. Mogensen notes that it sounds like a lot of money, but it’s not. They compete with Habitat for Humanity and other organizations, so it’s difficult to raise money, he says. It’s important to have a trust fund available when projects happen, he says. For every complex problem there’s a simple solution – and it’s wrong, he quips. Putting all the affordable housing in Ypsilanti is one such “simple” solution, he says.

7:31 p.m. Seth Best apologizes for his attire. At the house on Stone School Road, they’ve been doing some renovating work, and he didn’t have a chance to change. He’s speaking in support of the Library Lane lot resolution. For every 100 people who are searching for affordable housing in the U.S., there are 30 homes available, he says. Affordable housing takes time, he says. He suggests that some of the money should support a community center or a warming center: Where do people go tonight? he asks. It’s national LGBT month, he says – and if you send people down South, that could put people’s lives in danger.

7:34 p.m. Frank Burdick introduces himself as a Ward 4 resident. He’s encouraging the council to vote no on the contract extension for CDM Smith for footing drain disconnection work. He says the city council has for the last 13 years listened only to the city staff and the city attorney, but not their constituents. He tells the council they have “married” the consultant, CDM. He talks about unhappy and anxious citizens who have failing sump pumps and frozen, improperly installed pipes. The city’s developer offset mitigation (DOM) program should be 100% funded by developers, he says. He contends that the DOM program is in serious legal jeopardy. He suggests that developers should deposit money into an escrow account instead of continuing the DOM program. He challenges mayoral candidates to consider their vote on the resolution.

7:37 p.m. Thomas Partridge introduces himself as a recent candidate for various public offices. He calls on the mayor and council to re-open the city budget to allow for more housing for affordable housing and community development for the most vulnerable residents of the city. Protections under existing city policies are not adequate, he says. He calls for a change in attitude to bring about rules changes so that the public could have greater lobbying access to city hall. He wants public participation periods during the meeting, not just at the start and at the end. He supports the resolution on the Library Land lot sale proceeds, but says that all of the money should go into the trust fund, not just 50%.

7:40 p.m. Gregg Hammerman is cofounder of Larky – a mobile, web-based service that helps people keep track of discounts and perks to which they’re entitled through professional associations, alumni associations, credit cards, health insurance, shopping clubs, community groups, museums and the like. He graduated from UM in 1994 and started his first company then, called Techstreet. At that time, Ann Arbor SPARK didn’t exist, he says. Still, they managed to persevere and Techstreet was finally purchased – and it now has $30 million in revenue and about 25 employees. Now there’s a real start-up culture here in Ann Arbor, which he attributes to LDFA and SPARK. His new company has eight employees, which had been achieved in a two-year cycle, instead of the nine years that his first company required.

7:43 p.m. Jeff Hayner is speaking against voting on the LDFA resolution tonight and encourages the council not to approve it until more information on the efficacy of SPARK’s programs is available. He’s arguing that the SmartZones statewide amount to a geographic transfer of wealth.

7:46 p.m. Henry Herskovitz begins by asking: What if you heard through the news media that fighter jets from South Korea were used to attack a U.S. ship? Our answer would be clear – that the U.S. would not tolerate an attack by an ally. South Korea has not done that, but that’s what happened in 1967 with the USS Liberty when Israel [mistakenly] attacked the ship. U.S. citizens should take it seriously when a foreign government can influence U.S. foreign policy, he says.

7:46 p.m. Christopher Taylor (Ward 3) has now arrived.

7:46 p.m. Communications from the council. This is the first of two slots on the agenda for council communications. It’s a time when councilmembers can report out from boards, commissions and task forces on which they serve. They can also alert their colleagues to proposals they might be bringing forward in the near future.

7:47 p.m. Sally Petersen (Ward 2) says that the topic of the work session on June 9 will be ethics and council rules.

7:49 p.m. Jane Lumm (Ward 2) thanks everyone who has come in to license their dogs. She was here on Friday afternoon and there was a long line at the clerk’s office. Everyone wants to do the right thing, she says.

7:52 p.m. Stephen Kunselman (Ward 3) thanks staff for the repaving of the St. Aubin service drive near Platt Road. He announces he’ll be bringing forth a resolution at a future meeting to tender an offer on 8 acres where the Burton Commons affordable project is proposed. [The idea would be to use open space millage money.] Here’s an animated .gif of the aerial photos of the property: Burton Commons land. He’s arguing for the purchase based on climate change and the adjacency of Sylvan Park to the north. The resolution would direct staff to make an offer to purchase at fair market value.

7:53 p.m. Eaton conveys Anglin’s regrets that he can’t attend.

7:53 p.m. Appointments: Confirmation. Tonight the council is voting on nominations to city boards and commissions made at the council’s May 19 meeting. Larry Eiler was nominated to the Economic Development Corporation, replacing Daniel Blakemore. Andy Baker-White and Amanda Carlisle were nominated to the housing and human services advisory board to fill vacancies.

7:54 p.m. Outcome: The council has unanimously approved all the appointments.

7:54 p.m. Appointments: Nominations. Being nominated tonight for reappointment to the city planning commission are Wendy Woods and Eleanore Adenekan. Being nominated for reappointment to the commission on disability issues are Linda Evans and Larry Keeler. Their appointments will be voted on at the council’s next meeting.

7:54 p.m. Hieftje asks Lumm how many openings still remain on HHSAB. Lumm thinks there are still three vacancies.

7:54 p.m. Public hearings. All the public hearings are grouped together during this section of the meeting. Action on the related items comes later in the meeting. Five public hearings are scheduled tonight: PH-1 Ordinance to raise water, sewer, and stormwater rates; PH-2 Ordinance to amend drive-thru facilities and permitted uses; PH-3 Rezoning 515 Oxford (Delta Gamma); PH-4 Site plan for 515 Oxford (Delta Gamma); PH-5 Site plan for Ruth’s Chris.

7:55 p.m. PH-1 Ordinance to raise water, sewer, and stormwater rates.

7:56 p.m. Thomas Partridge asks that rates be revised so that the impact on the most vulnerable residents is ameliorated.

7:57 p.m. Margie Teall (Ward 4) has now arrived.

8:01 p.m. Jeff Hayner says that water rates have gone up every year. He notices it as homeowner, he says. He cites some Sierra Club information that indicates that only three Michigan municipalities operate water services as a utility, including Detroit and Ann Arbor. He questions why the fourth heavy use tier has been dropped – and wonders if it resulted from an effort to accommodate the University of Michigan. He asks the council to please keep Ann Arbor affordable.

8:01 p.m. PH-2 Ordinance to amend drive-thru facilities and permitted uses. No one speaks on this hearing.

8:02 p.m. PH-3 Rezoning 515 Oxford (Delta Gamma).

8:04 p.m. Thomas Partridge says the property needs to be accessible to disabled students.

8:05 p.m. PH-4 Site plan for 515 Oxford (Delta Gamma).

8:05 p.m. No one speaks at this public hearing.

8:06 p.m. PH-5 Site plan for Ruth’s Chris. Steve Fry, who is representing Ruth’s Chris, tells the council that he’s here if there are questions.

8:07 p.m. Thomas Partridge calls on the council to require the restaurant to be truly accessible to those who are disabled and to seniors and those who need to use public transportation. He says there should be menu items that are affordable to those with lower incomes.

8:09 p.m. Approval of minutes. Outcome: The council has approved the minutes of the previous meeting.

8:09 p.m. Consent agenda. This is a group of items that are deemed to be routine and are voted on “all in one go.” Contracts for less than $100,000 can be placed on the consent agenda. This meeting’s consent agenda includes …

8:09 p.m. Councilmembers can opt to select out any items for separate consideration. Kunselman pulls out CA-4. It’s a resolution authorizing $28,444 in sanitary sewer and water improvement charges for 3980 Platt Road.

8:09 p.m. Outcome: All items on the consent agenda except for CA-4 have now been approved.

8:10 p.m. CA-4 Authorize sanitary sewer and water improvement charges for 3980 Platt Road. ($28,444). Kunselman says the property has been under construction for some time. If this resolution is approved, he wonders if the builder will be pursuing this more diligently. Craig Hupy, the city’s public services area administrator, says that he won’t comment on the builder’s intent, but this will remove one hurdle.

8:11 p.m. Outcome: All items on the consent agenda have now been approved.

8:11 p.m. B-1 Increase water, sewer, and stormwater rates. The council will consider giving final approval to higher utility rates – for water, sewer and stormwater. Initial approval came at the council’s May 19 meeting.

Water rates will increase across all tiers of consumption. For the first 7 “units” of water, the charge is will increase from $1.35 to $1.40. For the next 21 units, the charge is proposed to increase from $2.85 to $2.96 per unit. And for the 17 units after that, the increase is proposed to be from $4.88 to $5.08. A unit is 100 cubic feet, which is 748 gallons. [For additional background, see Utility Rates above.]

8:13 p.m. Hieftje says he’s been following this for several years. And the city does a comparison with other communities. He calls the rate increases middle-of-the-pack and appropriate for a city with infrastructure the age of Ann Arbor’s. Hieftje is comparing the issue with roads – that to maintain the infrastructure, it requires money. He says the city’s departments are efficient with their use of money.

8:15 p.m. Kailasapathy asks about the four tiers of the previous approach: Why did the city move from a four-tier system to a three-tier system? Hupy says that those tiers are residential tiers. That was done in response to customers and councilmembers – and that fourth tier hit the large residential users. Powers adds that the commercial rates – including institutional uses – have a different rate structure.

8:16 p.m. Briere notes that years ago, the council used to receive the comparative analysis with other communities and asks that it be provided. Hupy will forward it to councilmembers.

8:17 p.m. Lumm reviews the elimination of the fourth pricing tier – and describes how it affected people who were watering their lawns. She describes the previous rates as involving “ungodly sums.” She notes that the rate increases will translate to $2.3 million in additional revenue. No one wants to increase prices, unless it’s absolutely necessary, and that standard is met, she says.

8:20 p.m. Kunselman asks if it will be possible to slow the rate of increase in future years. Hupy indicates he’s pessimistic that could happen for water rates, given that about half of the drinking water treatment plant might need to be replaced. Hupy expects at a minimum that water rate increases will be similar to what the city is doing for sewer rates.

8:20 p.m. Outcome: The council has voted to give final approval to the increase in water, sewer and stormwater rates.

8:20 p.m. B-2 Ordinance to amend regulations regarding drive-thru facilities and permitted uses. On tonight’s agenda is final approval of amendments to Ann Arbor’s zoning ordinance related to drive-thrus. Initial approval came at the council’s May 5 meeting. The amendments would add a definition of a “drive-thru facility” to Chapter 55 of the city code. Currently, the term used throughout the code is “drive-in,” which is not explicitly defined in the code. [For additional background, see Drive-Thru Ordinance: Final Approval above.]

8:23 p.m. Eaton asks planning manager Wendy Rampson how this change differs from the standard the city has in the code now. Rampson describes how the new standard makes it clear that all drive-thrus are subject to planning commission review for special exception use. And windows can’t face the right-of-way, she says. Eaton ventures that this means that planning commission and the council have discretion to grant the special exception use. Rampson notes that he’s correct, but adds that the planning commission has purview on the special exception use. Eaton asks what the standards are for exercise of that discretion. Rampson points to the relevant section of the code.

8:26 p.m. Eaton raises the specter of a long line of cars extending into a neighborhood. Could anything be done about that? Rampson says that the planning commission has discretion on a case-by-case basis – and the commission could deny the application. Eaton ventures that the denial would not be required. Eaton says it would be easy to write this kind of requirement into the code – to prevent that kind of impact on a neighborhood. He revises “easy” to “plausible.”

8:26 p.m. Warpehoski says he’s glad to see this going through. Changing from by-right to discretionary is a good step, he says.

8:28 p.m. Briere says that she can send councilmembers the section of the ordinance that deals with special exception uses. There’s always the risk of making one size fit all, she says. The language in the ordinance revision is flexible enough that each site can be considered on a case-by-case basis.

8:29 p.m. Eaton says he wants to send this back to the planning commission to write into the ordinance what will happen when a drive-thru window is adjacent to a residential neighborhood.

8:30 p.m. The motion in front of the council is to refer this back to the planning commission. Warpehoski says he doesn’t think this needs to be sent back to the planning commission in order for Eaton’s goal to be realized. He doesn’t want to hold up the effort now.

8:31 p.m. Hieftje says he’s siding with Warpehoski, and wants to see the council pass what is good, instead of holding it up until it is perfect.

8:33 p.m. Briere says if there are concerns about drive-thru windows operating near residential neighborhoods, they should be looked into, but says there are already a lot of protections in the code.

8:34 p.m. Outcome on Eaton’s motion to refer it back to the planning commission: It fails on a 3-7 vote with support only from Eaton, Lumm and Kailasapathy. Anglin is absent.

8:34 p.m. Taylor says he’d also like to see the additional criteria, but adds that the changes in front of the council tonight already move the ball in the right direction.

8:34 p.m. Outcome: The council has voted to give final approval to the revised regulations on drive-thrus.

8:34 p.m. B-3 Rezone 515 Oxford (Delta Gamma). The city council is being asked tonight to give final approval of a rezoning request for 515 Oxford, to convert a house for use as an annex to the Delta Gamma sorority. The main sorority house is located nearby at 626 Oxford. The council gave initial approval to the rezoning at its May 5, 2014 meeting. Later on tonight’s agenda is consideration of the site plan approval for the same project. The site plan was recommended for approval by planning commissioners on April 15, 2014. [For additional background, see Delta Gamma Site Plan, Rezoning above.]

8:36 p.m. Briere says that for many people, this is a landmark building, designed by an architect for his home and studio.

8:36 p.m. Outcome: The council has voted to give final approval to the rezoning required as part of the Delta Gamma project.

8:37 p.m. Recess. We’re in recess.

8:45 p.m. We’re back.

8:45 p.m. C-1 Rezone Green/Baxter (AAHC).  At tonight’s meeting, the council will consider giving initial approval to the rezoning of three Ann Arbor Housing Commission properties. The planning commission had recommended the rezoning at its May 6, 2014 meeting. The current PL (public land) zoning for some of the properties is a vestige of the AAHC properties’ status as city-owned land.

The three sites to be considered are part of the housing commission’s major initiative to upgrade the city’s public housing units by seeking private investors through low-income housing tax credits. [For additional background, see Rezoning: Housing Commission Properties above.] First up is the AAHC property at Green/Baxter Court Apartments from PL (public land) to R4A (multi-family dwelling district). The 2-acre site is located at 1701-1747 Green Road and contains 23 apartments in four buildings and a community center. It’s in Ward 2.

8:46 p.m. Outcome: The council has voted without discussion to give initial approval of the rezoning of the AAHC property at Green/Baxter.

8:46 p.m. C-2 Rezone Baker Commons (AAHC). This would rezone the property from PL (public land) to D2 (downtown interface). The 0.94-acre lot is located at 106 Packard Street, at the intersection with South Main, in Ward 5. It includes a 64-unit apartment building.

8:48 p.m. Kunselman has a question. Rampson comes to the podium. He ventures that Baker Commons would exceed the 60-foot height limit in D2. Rampson says they don’t have an official height of the building, but agrees that it could be taller than 60 feet. She says that this would be a non-conforming structure. AAHC has been notified, and she says it’s not an issue as far as she understands. There’s not really a viable alternative zoning, she says. There was not a planning commission discussion of the possible non-conformance, Rampson tells Kunselman.

8:49 p.m. Outcome: The council has voted to give initial approval to the rezoning of the AAHC property at Baker Commons.

8:49 p.m. C-3 Rezone Maple Meadows (AAHC). This item would rezone the property from R1C (single-family dwelling district) to R4B (multi-family dwelling district). The site is 3.4 acres at 800-890 South Maple Road and contains 29 apartments in five buildings and a community center. It’s located in Ward 5.

8:49 p.m. Outcome: The council has voted to give initial approval to the rezoning of the AAHC property at Maple Meadows.

8:49 p.m. DC-1 Establish policy for distribution of proceeds from sale of Library Lane lot development rights. Tonight the city council will consider a resolution setting a policy for distribution of the proceeds from the sale of development rights on the Library Lane lot. The proposed policy would set aside 50% of the net proceeds to the city’s affordable housing trust fund. [For additional background, see Library Lot Sale Proceeds above.]

8:52 p.m. Hieftje says he wants to talk about some history. Several years ago, Michael Appel of Avalon Housing had come and talked with him about a pot of money that was available from the feds. [Appel was here earlier, but has departed.] That effort by Avalon had led to a partnership with the nonprofit Food Gatherers and the creation of Carrot Way on Dhu Varren Road.

But the funding landscape has changed a lot since then, Hieftje says. He doesn’t think anything can get done without a “pot of money” here locally. The community’s plans were set back during the Great Recession, he says. Now is an opportunity to create that pot of money, he says, but the exact way the money will be spent can be decided later.

8:55 p.m. As one example, Hieftje floats the idea of creating something like a Carrot Way – that could be located on Platt Road, where Washtenaw County’s former juvenile court facility was located. Hieftje says that the number of people in attendance reflects how well the proposal has been received. He ventures that the sale price might be around $8-10 million, which would mean the city’s general fund would receive several million dollars.

8:59 p.m. Kailasapathy says she’s heard from constituents that they’d like to see an “Arrowwood Part II” and calls it a worthy goal. But she says that there needs to be criteria set for the use of the affordable housing trust fund. It’s there to create new capital assets, she says. It’s not for recurring expenses. She wants to protect this fund for capital assets and says it shouldn’t be used as a slush fund.

Kailasapathy also has mixed feelings about the Library Lane lot. She was the one vote in the 10-1 vote on the hiring of a real estate broker to sell the development rights. She says she’ll support this resolution, and she knows millions of dollars are needed and this is just a start. She’d support 100% of a Palio Lot sale going to affordable housing, she says.

9:00 p.m. Petersen agrees with Kailasapathy that this doesn’t end the conversation about the Library Lane lot. She looks forward to the conversation. It’s more than a great cause, she says – it’s one of the council’s budget priorities and supports economic development.

9:05 p.m. Kunselman says it’s nothing more than a “teaser” resolution, as it’s non-binding. The number of $8-10 million is different from the number that Jim Chaconas had given, he notes – it seems inflated. The same people who sponsored this resolution are the same people who voted to bond for a $50 million underground parking structure, he says. “We’ve spent more money housing cars than housing people.” He points toward a June 4, 2007 vote when the council had rescinded a previous affordable housing policy as part of a land sale – because the council needed the money from the sale of the First & Washington property to build the police/courts facility. When the sale is actually done, he’ll support putting that money into affordable housing.

9:06 p.m. Taylor says he’s delighted to be a co-sponsor. He says the resolution is a moral commitment to use the money for an important community need. Local government can’t wave a magic wand to make things affordable, he says.

9:09 p.m. Briere says that after Kunselman brought forward the resolution to sell the development rights, she’s had a conversation with Hieftje about what percentage should go to affordable housing. The council’s budget committee had recommended 10% at a minimum. She cautioned that she didn’t want to see the community benefit of affordable housing used as an argument for a project on the top of the Library Lane lot that might not be a community benefit. She’s recounting the contributions that the council has made to the affordable housing trust fund – including from the former Y lot and from a strip of land associated with that parcel, as well as general fund contributions.

9:11 p.m. Briere asks if it’s political or if it’s good policy – and she concludes it’s not a political circus, saying that it’s an attempt to make good policy.

9:14 p.m. Lumm is concerned about the percentage and the timing of the decision. She’d supported the minimum 10% of the council’s budget committee, she says. This was first brought up on April 7, she says. The 50% amount is not unreasonable, she adds. But she says that the city’s general fund reserves are currently on the low side. She wouldn’t support any more than 50%. Chaconas’ estimate of $6-7 million would go down as chunks were taken away for public space, she says. Lumm is also concerned about other needs the city might have. She ventures that it might make sense to postpone again.

9:14 p.m. Lumm says she could go either way on this.

9:17 p.m. Eaton says this decision is premature. He notes that it’s not clear that the council has decided that the Library Lane lot development rights will be sold. This would put pressure on the council to sell those development rights, and cautions that it would possibly taint a decision to sell those rights. He’s also concerned about a lack of clear criteria for use of money in the affordable housing trust fund. It should be restricted to capital investments, he says. So he resists the idea of accumulating such large sums. He’d expressed those concerns when the council had sold the former Y lot. So he won’t support the resolution, he says.

9:19 p.m. Kunselman said he’d detailed some problems at a previous meeting about the bonding used for the construction of the underground parking garage. [The issue relates to how many spaces can be dedicated to private use.] He wants to know if staff now has an analysis of how many spaces are available for private use. Powers says that some of that information is still being compiled, but notes that some of the issues were addressed in a confidential memo to councilmembers from the city attorney. Powers allows that the answer to the question probably affects how valuable the property is.

9:23 p.m. Warpehoski notes that some councilmembers have wanted to lock down the amount of space designated as public open space before moving forward – and didn’t feel that it was premature to make that determination. Similarly, he doesn’t think that locking down a percentage for affordable housing is premature. Warpehoski will support the resolution.

9:23 p.m. Lumm says that her point is that things do change and that she wants to see how much money the sale actually generates.

9:24 p.m. Lumm is reviewing the changing in funding strategies by MSHDA – the Michigan State Housing Development Authority.

9:26 p.m. Kunselman proposes an amendment, saying that the Ann Arbor Housing Commission is the largest affordable housing provider in the city. He wants to stipulate that 25% of all proceeds go to the AAHC – in addition to the 50% that would go to the affordable housing trust fund.

9:28 p.m. Briere gets clarification that Kunselman that he’s not confining the AAHC allocation to just downtown AAHC properties. She notes that money from the affordable housing trust fund has been used in the past for AAHC properties. She doesn’t think this amendment is necessary.

9:30 p.m. Briere says she’s heard the concern that too much money would be used for the AAHC. Kunselman says it’s important that the AAHC be given money “straight up” without having to come ask. He doesn’t think they should have to go through hoops – saying that AAHC shouldn’t have to go before the HHSAB.

9:32 p.m. Kunselman says the council has neglected the AAHC for so many years, trying to engage in speculative development. He cites the former Y lot, Near North and Burton Commons. He points out that AAHC is also looking to increase their number of units.

9:33 p.m. Teall appreciates Kunselman’s concern for the AAHC, but doesn’t think that AAHC has been neglected. It’s good for the process that when the AAHC needs funds, they come and request the funds and explain what the funds are needed for, she says.

9:37 p.m. Hieftje agrees with Teall and Briere that the AAHC can come and ask for money when they need it.

9:37 p.m. Outcome on the amendment: The council has voted to reject Kunselman’s amendment with support only from Kunselman, Kailasapathy and Eaton.

9:39 p.m. Briere speaks in support of the resolution, saying she’ll carry the concerns she’s heard back to HHSAB. Kunselman says he won’t support this for reasons he’s already described. He noted that he’d been the one to push forward the Y lot sale and he’d also been the one to push for the sale of Library Lane lot development rights. The resolution tonight is premature. He wants the council to have concrete information instead of making “grand gestures” to appease people.

9:42 p.m. Hieftje is now unable to resist responding to Kunselman’s remarks about using public TIF (tax increment finance) dollars to support parking – saying it’s an important economic development tool. He’s giving others on the council credit for some of the good things that have happened – reacting to Kunselman’s previous remarks about his own role.

9:43 p.m. Outcome: The council has voted to approve the policy on designating proceeds from sale of development rights on the Library Lane lot. Voting for it were Taylor, Teall, Warpehoski, Hieftje, Kailasapathy, Briere and Petersen. Anglin was absent. Kunselman, Lumm and Eaton voted against it.

9:43 p.m. DC-2 Remove funding for Larcom reskin. This is a proposal to recommend to the planning commission that the capital improvements plan (CIP) for FY 2017 and FY 2018 be revised to remove the $4.4 million that is included for a city hall reskinning project. The council postponed this item from its May 19, 2014 meeting. According to a staff memo written in response to a councilmember question, reskinning of the Larcom City Hall building would mean replacing the existing exterior walls and windows of the building. The result would be new squared-off exterior, eliminating the inverted pyramid design. The new exterior would hang vertically from the sixth floor. [For additional background, see City Hall Reskinning above.]

9:45 p.m. Lumm is reading aloud a prepared statement about other capital needs in the city. She describes the reskin of the Larcom building as being something that “might be nice” and expresses skepticism that the energy savings would translate to a positive business case.

9:48 p.m. Briere says that she has a bureaucratic problem with the resolution: The council can remove the funding, but the planning commission approves the content. The resolution asks the planning commission to remove the funding. So she had to ask what would happen if the planning commission removed the Larcom reskin from the CIP. Briere wants to remove the reference to the $4.4 million, but Petersen says that it’s merely an adjectival modifier of the project.

9:50 p.m. Petersen says that the council isn’t voting on the bureaucratic issue – and she’s going to support this resolution. She’s urging the council to explore the energy improvements. Hieftje says that he’ll support this resolution, because the city doesn’t have $4.4 million lying around. He recalls efforts the city had made to find federal dollars for the energy improvements.

9:52 p.m. Kailasapathy says that she doesn’t believe that there’s “free money” even if it comes from the federal or state government, because it’s all taxpayer money. She wants the cosmetic components of the project removed. “I just want to see this gone,” she says.

9:53 p.m. Teall won’t support this tonight. Energy efficiency is and should be a priority, she says. She recognizes that she’s fighting a losing battle. She’s concerned not just about the windows, but also about the insulation in the walls. Having the project in the CIP doesn’t mean we’re spending the money, Teall notes. She’s citing a common sentiment of Kunselman that the council shouldn’t tie the hands of future councils.

9:56 p.m. Kunselman says it’s ironic that he’d tried to fight the airport runway extension by removing it from the CIP, but he wasn’t sure he wanted to adopt that approach here. He wants to know more about the windows: Did they date from the 1960s? Powers notes that this is a project in the 2017 year of the CIP. Hupy confirms that it’s a very conceptual budget at this point. He confirms that the windows are original. Kunselman ventures that the title of the project can be changed from “reskinning” to something involving energy efficiency. He doesn’t think this resolution will do anything, but now suggests an additional resolved clause to address a title that will be more limiting in scope.

9:57 p.m. Hieftje suggests a recess to craft the language Kunselman is trying to come up with.

9:57 p.m. Recess.

10:05 p.m. Samuel McMullen, Ward 3 candidate for council, has arrived at the meeting.

10:05 p.m. We’re back.

10:09 p.m. Kunselman reads aloud the additional “resolved” clause that expresses a council desire that an energy-efficiency project be developed for city hall. Lumm is now arguing against the amendment based on skepticism that there’d be adequate payback. Kunselman allows that window replacements don’t pay back in energy savings, but it does affect the comfort for building occupants. It’s also a strain on the HVAC system, he ventures.

10:12 p.m. Kunselman says that if the building is going to be around for a few more decades, it might be worth putting in some new windows. Petersen says that she’ll support Kunselman’s amendment, characterizing it as formally asking what councilmembers have been talking about. Briere says that Kunselman’s amendment suggests a more cost-effective approach to the problems with the walls and windows. Briere notes that the building has historic status now that it is older than 50 years. She’s not particularly fond of the building, though.

10:14 p.m. Eaton says that the message to the planning commission is that the council won’t support anything that has the scope of a $4.4 million project. Teall says she’ll support the amendment, but not necessarily the main question. Hieftje reiterates his support for the main question and for the amendment as well.

10:15 p.m. Outcome on the amendment: The council has voted to approve the amendment.

10:16 p.m. Lumm is happy that it appears this will pass.

10:16 p.m. Outcome: The council has voted to approve this resolution, over the dissent of Teall.

10:16 p.m. DC-3 Approve a five-year partnership agreement with Community Action Network for Operation of Bryant and Northside community centers. This is proposal for a five-year partnership between the city and the nonprofit Community Action Network. The partnership was recommended for approval by the Ann Arbor park advisory commission at its May 20, 2014 meeting. [For additional background, see Partnership with Community Action Network above.]

10:18 p.m. Taylor is reviewing the resolution. [Taylor is a council appointee to the park advisory commission.] Taylor says that CAN is uniquely qualified to provide this service. He encourages support of the resolution.

10:18 p.m. Outcome: The council has voted to approve the operating agreement with CAN for Northside and Bryant community centers.

10:18 p.m. DC-4 Approve application to MEDC for extension of LDFA term. This resolution would support the LDFA’s application to the MEDC for an extension of its current 15-year term, ending in 2018. The length of the extension would be for at least five years, and possibly as long as 15 years. [For additional background, see LDFA Extension above.]

10:21 p.m. Petersen is reviewing some points in a letter from the LDFA board to the council. First is that LDFA SmartZones are enabled by state statute. Second is that the LDFA has had its contract with SPARK audited. SPARK’s financials are now on SPARK’s website, she says. She notes that the LDFA has heard the council’s interest in high-speed telecommunications networks.

10:22 p.m. Carrie Leahy, chair of the LDFA board, has come to the podium to answer questions. She tells Lumm that the most serious conversations about who might be the satellite are Adrian and Brighton. She says that Flint is no longer on the table. She’s explaining that a satellite LDFA would set up its own TIF capture.

10:24 p.m. Lumm wants to know what the impact would be on the Ann Arbor Ypsi SmartZone. Leahy says the Ann Arbor Ypsi SmartZone funds wouldn’t be spent outside of Ann Arbor and Ypsi.

10:27 p.m. Hieftje ventures that Lumm is raising a good question: Why does the MEDC want to do this? SPARK CEO Paul Krutko says that MEDC worked with the legislature to see how to allow the LDFA program to continue. Currently there are 15 SmartZones, each with an opportunity to extend for five years. Three of the 15 have the chance to extend for 15 years. One of the three is already decided – Marquette. There’s a deadline set by the state, Krutko says, of June 30 and Sept. 30. The effort reflects the state’s emphasis on regional cooperation.

10:29 p.m. Leahy stresses that tonight’s resolution is just the first step. The application will then go to the MEDC. Then it will come back to the council. Krutko says that the LDFA wanted to come to the council early, because the other communities have a lot of steps to complete. Both of the communities still on the table are very interested, Krutko says.

10:32 p.m. Kailasapathy is returning to the topic of “windfall” gains that the LDFA had realized due to increased valuation in the TIF district. She’d proposed a budget amendment on May 19, when the council adopted next year’s budget, that would have reserved some of that windfall for construction of a high-speed telecommunications network. That amendment hadn’t succeeded. Kailasapathy wants to know if the LDFA can provide audited job creation numbers.

10:34 p.m. Leahy tells Kailasapathy that the LDFA has heard the council’s interest in infrastructure improvements and has begun to reach out to other communities and the MEDC to get more information about that.

10:35 p.m. Leahy says that the LDFA does not ask an independent party to verify the job creation numbers in an audit. “Why don’t you just do it?” Kailasapathy asks. Leahy says that the LDFA board has not had a meeting since the last council meeting.

10:37 p.m. Eaton is getting clarification from Leahy about the council’s options for denying an extension in the future. It sounds like the council could opt to extend only for five years, even if the MEDC approved an extension for 15 years.

10:38 p.m. Lumm says she doesn’t see any justification not to apply, because it would mean sending money elsewhere in the state.

10:42 p.m. Hieftje says he’s fully in support of this. He says that the city is interested in the best performance it can get out of Ann Arbor SPARK. Hieftje says that if the LDFA were to cease to exist, it would have no impact on the School Aid Fund.

Taylor is delighted to support this resolution. Both Ann Arbor SPARK and the LDFA do an excellent job, he says. About the drive for metrics, he says it’s the council’s obligation to oversee the money that is spent. It’s important to note, he says, that job creation statistics are not a science. It’s multivariable, he says.

10:46 p.m. Kunselman says he’s sitting on the fence. He doesn’t understand why the five-year extension is being discussed now five years ahead of the expiration of the LDFA. Kunselman expresses skepticism about the state’s reimbursement of the School Aid Fund, saying that the state has consistently underfunded the School Aid Fund. Powers quips that CFO Tom Crawford can’t speak for the governor except for the fact he’s not wearing a tie. Krutko corrects Kunselman’s understanding – pointing out that we’re only three years away from the expiration of the current LDFA.

10:47 p.m. Crawford is clarifying for Kunselman how the state reimburses the School Aid Fund.

10:47 p.m. Outcome: The council has voted to support the LDFA’s application for the extension of its term, over dissent from Kailasapathy.

10:47 p.m. DC-5 Approve Bravo Brio Restaurant Group Inc. for a new Resort Class C liquor license. The restaurant is located at 760 Briarwood Circle.

10:49 p.m. Lumm is reporting out the liquor license review committee’s work on considering these license applications.

10:49 p.m. Outcome: The council has voted to recommend approval of Bravo Brio’s application for a liquor license.

10:49 p.m. DC-6 Approve P.F. Chang’s China Bistro Inc. for a new Resort Class C liquor license. The restaurant is located at 720 Briarwood Circle.

10:49 p.m. Outcome: The council has voted to recommend approval of P.F. Chang’s application for a liquor license.

10:50 p.m. Closed Session. The council has voted to go into closed session to discuss pending litigation.

11:30 p.m. We’re back.

11:30 p.m. Recess. The council immediately takes a break.

11:36 p.m. We’re back.

11:38 p.m. DC-7 Community Events Fund Disbursements. This allocates $1,972 from the FY 2014 Community Events Fund to the African-American Downtown Festival scheduled for June 7, 2014.

11:38 p.m. Outcome: The council has unanimously approved the allocation.

11:39 p.m. DB-1 Approve 515 Oxford (Delta Gamma) site plan. This is the same project for which the zoning was given final approval earlier in the meeting.

11:39 p.m. Outcome: The council has voted to approve the Delta Gamma site plan.

11:39 p.m. DB-2 Approve Ruth’s Chris Site Plan This is the site plan for a new Ruth’s Chris Steak House on Fourth Avenue in downtown Ann Arbor. The planning commission recommended approval at its April 1, 2014 meeting. The site plan calls for renovating the single-story building at 314 S. Fourth Ave. and putting up a 1,943-square-foot second-floor mezzanine addition over the front part of the existing building. The current structure is 8,024 square feet, and most recently housed the Dream Nite Club, which closed in 2012. The project is estimated to cost $2.2 million. [.pdf of staff report on Ruth's Chris site plan] [For additional background, see Ruth’s Chris Site Plan above.]

11:39 p.m. Outcome: Without discussion, the council has voted to approve the Ruth’s Chris site plan.

11:39 p.m. DS-1 Approve amendment No. 4 to the contract with CDM Smith Michigan Inc. for the footing drain disconnect (FDD) program. This item is an extension of a contract with CDM Smith Inc. for continued work as part of Ann Arbor’s footing drain disconnection (FDD) program. It had been postponed at the council’s May 5, 2014 meeting.

In the interim, the dollar amount of the contract extension has been reduced from $748,106 to $143,440. That reflects a reduction in the scope of the work. The original May 5 resolution called for the following activities to be funded: citizen support ($36,928); FDD citizens advisory committee meetings ($24,180); information management for sump pump monitors ($93,707); developer offset mitigation (DOM) program support; ($95,213); and multi-family FDD implementation ($498,005). No longer a part of the scope of work in the revised June 2 resolution are the FDD citizens advisory committee meetings, information management, or the multi-family FDD implementation. [For additional background, see FDD Program Contract Extension above.]

11:41 p.m. Eaton says he’s glad to see that the amount in the contract has been pared down. But he does not think the city should be spending money on the DOM, saying that the DOM should be funded by the developers. Residents in Ward 4 have expressed concern about the quality of work done by CDM Smith, Eaton says. When the work isn’t done right, water can freeze, he adds.

11:43 p.m. Eaton contends that about 1/3 of the houses that have had FDDs done don’t have a proper air gap in the discharge pipe. Eaton doesn’t think the city should continue to spend money to this consultant, when it should be funded by the developers, not taxpayers.

11:43 p.m. Teall says she doesn’t share the same level of distrust of the consultant that Eaton does. She allows that she’s heard from constituents who’ve had these issues. She says that the council hears a lot from only a few constituents.

11:46 p.m. Hupy is now at the podium. Teall asks him to respond to Eaton’s remarks. Hupy says there are simply not 1/3 of the houses with FDDs that don’t have proper air gaps. He says that the city is working through various complaints. Out of the nearly 600 installations the city has done, only five were frozen this past winter, he says. So the issue is not as widespread as it’s been reported, Hupy says. The city is now looking at solving the root causes of any problems, he notes.

11:48 p.m. Hupy describes what CDM Smith does: When a developer identifies a candidate for an FDD, they go in and verify that it’s a viable candidate and also verify that the work was done properly. Hupy doesn’t know why the program is set up so that the city pays for the administration of the DOM program. Hupy says that going forward, that would be an obvious aspect of the program to consider changing.

11:51 p.m. Teall asks what the impact on city staff would be if the resolution were not approved. Nick Hutchison says it would require about half the time of two full-time employees – that is, one FTE. And some workloads would need to be moved around. Summer road projects would need to be managed with outside resources, he says. Teall characterizes the situation as substituting different consultancies for the consultancy with CDM Smith. Teall says she’ll support the resolution. She’s dismayed by some of the communication that the council has been receiving from some people. There hasn’t been a balance from other members of the citizens advisory committee, she says.

11:53 p.m. Eaton says that his 1/3 figure was based on the results of a survey done by the committee – Question 18. Hupy says that residents who reported that don’t understand what they’re looking at. Hupy adds that when the city inspects those situations, they don’t find 1/3 with inadequate air gaps.

11:55 p.m. Back and forth between Eaton and Hupy ensues. Eaton ventures that the survey documents a great deal of dissatisfaction. Hupy says that a question about whether you’d recommend the procedure to a neighbor had a 70% positive response.

11:57 p.m. Warpehoski says he understands and hears the concerns. He’s also a satisfied participant in the DOM program, he says. For him, it had worked well – as part of a basement renovation program. CDM Smith had answered his questions and worked with his general contractor. Warpehoski says that the council has approved site plans that have development agreements requiring FDDs, so he thinks the council needs to approve this resolution.

11:59 p.m. Lumm thanks Eaton for his work on this issue. She’s glad to see the reduced amount in the contract. The recommendation from the committee won’t be coming back until the fall, she notes. She doesn’t think it makes sense to stop all the development projects that are currently in process.

12:01 a.m. Kunselman gets confirmation that the DOM program is voluntary from the point of view of the homeowner.

12:03 a.m. Kunselman asks if there are houses in the queue for the DOM. Yes, about 13. But there are about 350 that are on the books as required. About 150-160 are at some point in the process. Kunselman asks if anyone who is paying $100 a month instead of doing an FDD. Yes, there are two.

12:04 a.m. Hieftje says he appreciates the light that Eaton’s work has shone on the issue. But the consequences of not approving this resolution would be onerous, he says.

12:06 a.m. Briere notes that the DOM program does not mandate FDDs, but rather that the flow mitigate in some way. Hupy confirms that. She wants to know if the city encourages alternatives to FDDs. Hupy says that the city reviews any ideas that developers have. He cites how some developers own enough fixtures that they can reduce flow in those and achieve the needed offset – e.g., Ann Arbor Public Schools and University of Michigan.

12:07 a.m. Briere asks if there’d be a benefit to having developers pay cash in lieu. Hupy isn’t sure.

12:08 a.m. Briere notes that some alternatives will need to be found, because there’s only a finite number of footing drains. Hupy agrees that there will be a point of diminishing returns.

12:09 a.m. Outcome: The council has voted to approve the CDM Smith contract for FDD work, over dissent from Eaton and Kailasapathy.

12:09 a.m. DS-2 Resolution No. 2 for special assessment district for Stone School Road reconstruction project. As part of a road reconstruction project for Stone School Road, the city is planning to install a sidewalk on the west side of the road. To fund the sidewalk construction, part of the cost will come from a special assessment of property owners. This resolution sets the roll of properties to be special assessed. [For additional background, see Stone School Road Sidewalk Special Assessment above.]

12:10 a.m. Kunselman says he’s very excited that this project is moving forward. He’s also excited that about 80% of the cost of the special assessment is being covered by public dollars.

12:10 a.m. Outcome: The council has voted to set the assessment roll for the Stone School sidewalk special assessment.

12:10 a.m. DS-3 Approve contract with Parsons Brinckerhoff Michigan Inc. South State Street transportation corridor study. This item would approve a $299,911 contract with Parsons Brinckerhoff Michigan Inc. to conduct a study of the South State Street transportation corridor. The 1.3 mile long area of the study extends from the intersection of Ellsworth Road and South State Street north to the intersection of Oakbrook Drive and South State Street. [For additional background, see State Street Transportation Corridor Study above.]

12:10 a.m. Outcome: The council has voted to approve the contract with Parsons Brinckerhoff for the State Street transportation corridor study.

12:10 a.m. DS-4 Adopt the City of Ann Arbor urban and community forest management plan. This item would adopt the first comprehensive plan for managing Ann Arbor’s urban forest. The Ann Arbor park advisory commission recommended adoption of the plan at its meeting on April 15, 2014. [.pdf of Urban & Community Forest Management Plan] [For additional background, see Urban Forest above.]

12:12 a.m. Lumm says that it represents a huge amount of work. She’s thanking those who were responsible for its development. She says she agrees that the urban forest is a defining and highly-valued characteristic of the community.

12:14 a.m. Taylor says that the plan was presented to the park advisory commission a while ago. [He's a council appointee to the PAC.] PAC was extremely impressed with the plan, he says.

12:14 a.m. Outcome: The council has voted to adopt the urban forestry plan.

12:14 a.m. DS-5 Accept a Fair Food Network grant for the Ann Arbor Farmer’s Market. This item would approve an agreement with the Fair Food Network to continue administering the Double Up Food Bucks program at the Ann Arbor farmer’s market. Approval would entail acceptance of $32,000 in funding. [For additional background, see Grant to Farmers Market for Food Stamp Recipients above.]

12:14 a.m. Outcome: The council has voted to accept the Fair Food Network grant.

12:15 a.m. DS-6 Amend Ann Arbor City budget for fiscal year 2014. This resolution would amend the current fiscal year’s budget (FY 2014) to ensure that expenditures do not exceed appropriated amounts. The budget amendment will ensure compliance with Public Act 621 of 1978. The total requested general fund budget amendment is $60,000. For all other funds, the amendment to be considered by the council on June 2 totals $310,000. [For additional background, see Amend Current Year's Budget above.]

12:15 a.m. Outcome: The council has voted to amend the FY 2014 budget.

12:15 a.m. Communications from council. Teall notes that Cinetopia is starting. It runs from June 4-8 at the Michigan Theater in Ann Arbor and also in Detroit.

12:16 a.m. Hieftje notes that the Ozone House celebrated its 45th anniversary, and there was a recent celebration for the 50th anniversary of the city’s Elizabeth Dean trust fund.

12:16 a.m. Clerk’s report. Outcome: The clerk’s report has been received.

12:16 a.m. Public comment. There’s no requirement to sign up in advance for this slot for public commentary.

12:18 a.m. Thomas Partridge salutes the council for passing the resolution on the distribution of proceeds from the sale of development rights for the Library Lot. It would have been better to have dedicated 100% of the money to affordable housing instead of 50%, he adds. Partridge says we need a new governor. He calls for the election of Democrat Mark Schauer.

12:22 a.m. Mark Koroi says he’s here to address the “debacle” that had occurred in the Bob Dascola lawsuit. The judge had excoriated the city in his opinion, and the city would now be paying tens of thousands of dollars in attorney’s fees, he notes. Koroi says that Jack Eaton has stated publicly that the council had not given authorization for the city attorney’s action, so who did? Koroi says he’s endorsing McMullen in the race, but felt that Dascola should not have been denied access to the ballot.

12:25 a.m. Caleb Poirier is addressing the council on the challenge of dealing with the homeless population and those who are living under bridges. There are some unmet needs: toileting and trash removal. It’s the desire of his nonprofit to deal with the trash. He has a two-part request – to get trash into city dumpsters and to keep fecal matter out of the river. So he’d support port-a-potties at those locations.

12:28 a.m. Elizabeth Kurtz says she’s presentable because she just got her hair cut. Having lived on the streets for about 14 months, she’d been able to get into temporary housing. Generally she has little access to laundry and bathing facilities, she says. Despite the council’s resolution tonight, there’s little attention to immediate needs, she says. She describes herself as living a Third World existence. She was part of a Detroit Public Schools layoff – up until then, she was part of the middle class. We’ve got to get our priorities straight, she says.

12:31 a.m. Judy Bonnell-Wenzel is lamenting the fact that a friend of hers, Alan Haber, is away for the summer and is not here to speak in favor of a public commons on the Library Lot. She also says that people who have no place to sleep and unmet basic needs have no democracy. She worries about gentrification – pushing people out. She and her husband pay $527 a month for their housing, she says.

12:31 a.m. Adjournment. We are now adjourned. That’s all from the hard benches.

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

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Screenshot of Legistar – the city of Ann Arbor’s online agenda management system. Image links to the June 2, 2014 meeting agenda.

But the June 2 meeting agenda is dominated by items related to the physical attributes and layout of the city. Several items deal with city-owned physical assets, while several more involve land use and planning.

Possibly one of the more controversial agenda items related to physical infrastructure – and future development in the city – is a contract extension with CDM Smith Inc. for work related to the city’s footing drain disconnection (FDD) program. While the city council suspended the program in certain areas of the city in 2012, it continued in other areas, backed by the city’s ordinance under which the city can require residents to disconnect their footing drains from the sanitary sewer system.

Also not suspended was the city’s developer offset mitigation program, which requires developers to offset the increased flow from new construction into the sanitary sewer system. The vote on the CDM Smith Inc. contract extension was postponed from the council’s May 5 meeting. The dollar amount of the contract extension has been substantially reduced in the meantime – from about $750,000 to $143,000.

Part of the backdrop of the CDM Smith contract extension is a lawsuit that’s been filed against the city, challenging the legal foundation of the footing drain disconnect ordinance. The city sought to remove the case from state court to the federal system, but at a hearing on the matter this week, a federal judge indicated he’d be remanding the case back to the Washtenaw County 22nd circuit court.

City assets on the June 2 agenda include trees – as the council will be asked to approve the city’s urban and community forest management plan. The council will also consider a resolution on the city’s possibly most recognizable asset – the city hall building. The resolution would remove a $4 million renovation of city hall (a “reskinning”) from the city’s capital improvements plan for 2017 and 2018. This resolution was postponed from the council’s May 19 meeting.

Another city-owned asset on the agenda is the Library Lane underground parking garage. The council has already directed the city administrator to engage a real estate broker to test the market for the development rights for the surface of the garage. The resolution on the June 2 agenda, which was postponed at the council’s April 7 meeting, would set a policy to deposit 50% of the net proceeds from the sale of the development rights into the city’s affordable housing trust fund.

Land use and planning items on the June 2 agenda include a roughly $300,000 contract for study of the State Street transportation corridor. Related to transportation infrastructure, the council will also be asked to approve resolutions that move along the process of special assessing property owners on Stone School Road for the cost of installing a sidewalk on the west side of the road in connection with a road reconstruction project.

Also related to land use, three Ann Arbor housing commission properties will be given initial consideration for rezoning. A site plan and associated rezoning for the Delta Gamma house will be given final consideration. Also up for final consideration is a revision to the ordinance regulating drive-thrus. And the site plan for a new Ruth’s Chris restaurant to be located downtown on South Fourth Avenue will be given consideration.

A rate increase for Ann Arbor water, sewer and stormwater rates is on the June 2 agenda for final approval.

Two items connected to parks and recreation appear on the agenda. One is approval of the receipt of funding for a program that helps Bridge cardholders purchase local produce at the farmers market. The second item is approval of a five-year agreement with the Community Action Network to continue operating the city’s Northside and Bryant community centers.

The council will also be considering a resolution in support of the local development finance authority’s application to the Michigan Economic Development Corp. for a possible 15-year extension of the arrangement under which the LDFA captures taxes. The captured taxes are used to fund a business accelerator that’s operated by Ann Arbor SPARK through a contract with the LDFA. Without an extension, the LDFA would end in 2018.

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

Amend Current Year’s Budget

On June 2 the council will consider a resolution amending the current fiscal year’s budget (FY 2014) to ensure that expenditures do not exceed appropriated amounts. The budget amendment will ensure compliance with Public Act 621 of 1978.

The total requested general fund budget amendment is $60,000. For all other funds, the amendment to be considered by the council on June 2 totals $310,000.

The non-general fund amount will cover right-of-way maintenance and purchase of materials that were necessary to deal with the severe winter weather. The general fund amount was the city’s cost for the Ann Arbor Area Transportation Authority’s special election held on May 6. That amount will eventually be reimbursed by Washtenaw County – which in turn will receive reimbursement from the AAATA to cover the roughly $100,000 cost of the election.

FDD Program Contract Extension

A contract extension with CDM Smith Inc. for continued work as part of Ann Arbor’s footing drain disconnection (FDD) program appears on the June 2 agenda. It had been postponed at the council’s May 5, 2014 meeting.

In the interim, the dollar amount of the contract extension has been reduced from $748,106 to $143,440. That reflects a reduction in the scope of the work. The original May 5 resolution called for the following activities to be funded: citizen support ($36,928); FDD citizens advisory committee meetings ($24,180); information management for sump pump monitors ($93,707); developer offset mitigation (DOM) program support; ($95,213); and multi-family FDD implementation ($498,005).

No longer a part of the scope of work in the revised June 2 resolution are the FDD citizens advisory committee meetings, information management, or the multi-family FDD implementation. The revised memo describes how the funding would only provide a bridge until recommendations from a study group have been received, which will determine the future of the FDD program:

This amendment would provide the services needed to bridge the gap until the SSWWE [Sanitary Sewer Wet Weather Evaluation] Project recommendations have been made. Presently, the anticipated timeline for completion of the SSWWE Project is in the autumn of 2014. That does not allow sufficient time to issue a new RFP, collect and review proposals, award a contract, and bring a new consultant up to speed to manage the remaining FDD and DOM work outlined above. Existing City staff does not currently have the available resources or expertise to perform the inspections required for the DOM program.

By way of additional background, in 2012 the city’s program to disconnect footing drains from the sanitary sewer system was suspended by the council in some areas of the city. Specifically, it was suspended in the Glen Leven and Morehead (Lansdowne neighborhood) areas. The program was allowed to continue in other geographic areas and as part of the city’s developer offset mitigation (DOM) program. The DOM requires owners of new developments to complete a certain number of FDDs to offset the additional flow in the sanitary system caused by new construction.

The CDM contract drew scrutiny at the May 5 meeting because the city is currently undertaking a sanitary sewer wet weather evaluation (SSWWE) study. It’s supposed to yield a recommendation about whether to continue with the FDD program, and if so, in what form. In addition, the city’s ordinance – which requires property owners to undertake FDDs – was challenged in a lawsuit filed earlier this year. That case is pending as the city first removed the case from state to federal court. But the result of a May 28 hearing before a federal judge will be to return the case to the Washtenaw County 22nd circuit court.

The previous three iterations of the CDM contract totaled  about $3.6 million. The money for these contracts is drawn from the city’s sewer fund.

The proposed contract extension drew criticism during public commentary on May 5 from Frank Burdick, a Ward 4 resident who urged the council to reject it. Council deliberations on this item were included as part of The Chronicle’s live updates from the May 5 meeting.

Since the FDD program’s start in 2001, about 1,834 footing drains have been disconnected through the city program and 848 footing drains have been disconnected through the developer offset mitigation program.

Animation of contrast between the pre-FDD configuration and the post-FDD configuration. (Original illustration from screenshots of YouTube video by Milwaukee Metropolitan Sewerage District, modified by The Chronicle.)

Urban Forest

The city’s first comprehensive plan for managing Ann Arbor’s urban forest will be considered at the council’s June 2 meeting. The Ann Arbor park advisory commission recommended adoption of the plan at its meeting on April 15, 2014. [.pdf of Urban & Community Forest Management Plan]

An urban forest is defined as all the trees, shrubs and woody vegetation growing along city streets, in public parks and on institutional and private property. In Ann Arbor, about 25% is on public property, with 75% on private property. Based on a U.S. Dept. of Agriculture Forest Service i-Tree Eco Analysis done in 2012, Ann Arbor’s urban forest has an estimated 1.45 million trees. It creates a 33% tree canopy – the layer of leaves, branches and stems of trees that cover the ground when viewed from above.

The city manages 43,240 street trees and about 6,900 park trees in mowed areas. A tree inventory conducted in 2009 didn’t include natural areas, she noted, so there are thousands of trees that aren’t counted. The urban forest includes over 200 species, representing 82 genera.

Map of selected tree variety by The Chronicle from city of Ann Arbor 2009 survey. Image links to dynamic map hosted on geocommons.com

PAC had been briefed on the 135-page Urban & Community Forest Management Plan at its Feb. 25, 2014 meeting by Kerry Gray, the city’s urban forest & natural resources planning coordinator. The management plan includes 17 recommendations, listed in priority based on community feedback for implementation. Each of the 17 recommendations includes action tasks and implementation ideas, case studies, and resources that are needed, including funding. The recommendations are:

1. Implement proactive tree maintenance program.
2. Strengthen tree planting and young tree maintenance programs.
3. Monitor threats to the urban and community forest.
4. Increase landmark/special tree protections.
5. Secure adequate city‐funding for urban forestry core services.
6. Develop street tree master plans.
7. Pursue grant and philanthropic funding opportunities.
8. Strengthen forestry related ordinances.
9. Update tree inventory and canopy analysis.
10. Develop urban forest best management practices.
11. Increase urban forestry volunteerism.
12. Strengthen relationships with outside entities who impact trees.
13. Implement community outreach program.
14. Obtain the best use of wood from removed trees.
15. Create city staff working groups to coordinate projects that impact trees.
16. Engage the city’s Environmental Commission in urban and community forestry issues.
17. Review the urban forest management plan periodically and update as needed.

City Hall Reskinning

At its June 2 meeting, the council will consider a proposal to recommend to the planning commission that the capital improvements plan (CIP) for FY 2017 and FY 2018 be revised to remove the $4.4 million that is included for a city hall reskinning project. The planning commission is the body that approves the CIP. But the council has budgetary discretion to fund projects in the CIP or not – so the resolution in some sense calls on the planning commission to take an action it does not have the authority to execute. This was a point made during deliberations at the council’s May 19, 2014 meeting when the item was postponed.

According to a staff memo written in response to a councilmember question, reskinning of the Larcom City Hall building would mean replacing the existing exterior walls and windows of the building. The result would be new squared-off exterior, eliminating the inverted pyramid design. The new exterior would hang vertically from the sixth floor.

The focus of the project is on improving energy efficiency. The memo describes existing windows as mostly single-pane glass on aluminum frames, which offer little insulation value. The project would also result in an incremental gain in square footage – because the lower floors would have the same footprint as the sixth floor, which is currently the largest floor of the building. The materials used for the exterior would “blend better” with the recently constructed Justice Center, which adjoins city hall.

Library Lot Sale Proceeds

On June 2 the city council will consider a resolution setting a policy for distribution of the proceeds from the sale of development rights on the Library Lot. The proposed policy would set aside 50% of the net proceeds to the city’s affordable housing trust fund.

The council has already directed the city administrator to hire a real estate broker to explore selling the rights to develop the site – above the Library Lane underground parking structure, which was completed in 2012.

The item was postponed at the council’s April 7, 2014 meeting. The vote was 6-5 to postpone, with dissent from Sabra Briere (Ward 1), Christopher Taylor (Ward 3), Margie Teall (Ward 4), Chuck Warpehoski (Ward 5), and mayor John Hieftje.

State Street Transportation Corridor Study

The June 2 agenda includes a resolution for a $299,911 contract with Parsons Brinckerhoff Michigan Inc. to conduct a study of the South State Street transportation corridor. The 1.3 mile long area of the study extends from the intersection of Ellsworth Road and South State Street north to the intersection of Oakbrook Drive and South State Street. The money to pay for the study will be drawn in equal parts from the current fiscal year and next year’s general capital fund budget. The study will take a year, starting in June 2014.

The goal of the study is focused on transportation needs in the corridor and to provide base conceptual engineering plans for the redesign of the corridor – possibly including a boulevard “Complete Street” design. The redesign would be intended to “address all modes of travel; enhance vehicle flow; improve safety; create an aesthetically pleasing entrance to the City; and, utilize sustainable concepts such as low impact design (‘LID’), and low energy use lighting.”

The study of the area as a transportation corridor comes not long after a recently completed South State Street corridor plan, adopted by the city council into the city’s master plan at its July 15, 2014 meeting. That corridor plan established planning objectives for the land use along the corridor.

Besides Parsons Brinckerhoff, the other bidder for the work was DLZ.

Stone School Road Sidewalk Special Assessment

As part of a road reconstruction project for Stone School Road, the city is planning to install a sidewalk on the west side of the road. To fund the sidewalk construction, part of the cost will come from a special assessment of property owners. The extent of the project on Stone School Road runs from I-94 to Ellsworth Road. Construction is planned for the project during the 2014 and 2015 construction seasons.

The project is being funded in part through a federal surface transportation grant, which can pay about 80% of construction costs, but not engineering, testing or inspection costs. The total project cost is roughly $128,500, of which about $55,000 will be special assessed.

The council will be asked to approve a resolution directing the city assessor to set the roll of properties to be assessed.

Rezoning: Housing Commission Properties

At its June 2 meeting, the city council will consider giving initial approval to the rezoning of three Ann Arbor Housing Commission properties. The planning commission had recommended the rezoning at its May 6, 2014 meeting. The current PL (public land) zoning for some of the properties is a vestige of the AAHC properties’ status as city-owned land. The city council approved the transfer of deeds to the AAHC at its June 2, 2013 meeting. The three sites to be considered on June 2 are part of the housing commission’s major initiative to upgrade the city’s public housing units by seeking private investors through low-income housing tax credits.

Rezoning is recommended for the following public housing sites, two of which are currently zoned as public land:

• Baker Commons: Rezone public land to D2 (downtown interface). The 0.94-acre lot is located at 106 Packard Street, at the intersection with South Main, in Ward 5. It includes a 64-unit apartment building.
• Green/Baxter Court Apartments: Rezone public land to R4A (multi-family dwelling district). The 2-acre site is located at 1701-1747 Green Road and contains 23 apartments in four buildings and a community center. It’s in Ward 2.
• Maple Meadows: Currently zoned R1C (single-family dwelling district), the recommendation is to rezone it as R4B (multi-family dwelling district). The site is 3.4 acres at 800-890 South Maple Road and contains 29 apartments in five buildings and a community center. It’s located in Ward 5.

At the planning commission’s May 6 meeting, AAHC director Jennifer Hall explained that PL zoning doesn’t allow housing to be built on it. As AAHC seeks private funding to rehab its properties, it needs to ensure if a building burns down, for example, it could be rebuilt. In general that’s why the rezoning is being requested. It’s also being requested to align the zoning with the current uses of the property. She stressed that the highest priority properties to be rezoned are Baker Commons, Green/Baxter and Maple Meadows, because investors have already been found to renovate those sites.

For these three sites, planning commissioners also voted to waive the area plan requirements for the AAHC rezoning petitions, because no new construction is proposed and surveys of the improvements have been provided.

For additional background on the AAHC process of renovating its properties, see Chronicle coverage: “Public Housing Conversion Takes Next Step.”

Delta Gamma Site Plan, Rezoning

The city council will be asked on June 2 to give final approval of a rezoning request for 515 Oxford, to convert a house for use as an annex to the Delta Gamma sorority. The main sorority house is located nearby at 626 Oxford. The council gave initial approval to the rezoning at its May 5, 2014 meeting. Also on the June 2 agenda is consideration of the site plan approval for the same project. The site plan was recommended for approval by planning commissioners on April 15, 2014.

Aerial view showing the location of 515 Oxford, south of Geddes and at the eastern end of South University.

The rezoning request, recommended by the planning commission on Jan. 23, 2014, is to rezone the parcel from R4A (multi-family dwelling) to R2B (two-family dwelling and student housing). Most of the surrounding parcels are zoned R2B, although the site immediately to the north is also zoned R4A. Also nearby is public land (PL) where the University of Michigan’s Oxford Houses complex is located.

The two-story house at 515 Oxford includes two one-story wings. It is currently a rental property with three units – a studio apartment, one-bedroom apartment, and four-bedroom apartment – and a maximum occupancy of 8 people. One of the units is in a former garage.

The proposal for a renovation would accommodate a maximum of 20 residents, including a required resident manager.

The building is notable because it was originally designed in 1940 by architect George Brigham, who used it as his home and architectural studio. He designed over 40 houses in Ann Arbor, including many in Arbor Hills and Barton Hills between 1936 and 1958.

Drive-Thru Ordinance: Final Approval

On the city council’s June 2 agenda is final approval of amendments to Ann Arbor’s zoning ordinance related to drive-thrus. Initial approval came at the council’s May 5 meeting. The amendments would add a definition of a “drive-thru facility” to Chapter 55 of the city code. Currently, the term used throughout the code is “drive-in,” which is not explicitly defined in the code.

The proposed revisions define a drive-thru in this way: “Any building or structure, or portion thereof, that is constructed or operated for the purpose of providing goods or services to customers who remain in their vehicle during the course of the transaction.” The revisions also clarify that a drive-thru is an accessory use, not the principle use of the building. A project in which a drive-thru would be the principle use would not be allowed. Basic layout requirements would also be added to the ordinance.

In addition, the changes would require drive-thrus to obtain special exception use permits, which would be allowed only in the O (office), C2B (business service) and C3 (fringe commercial) zoning districts. Drive-thrus would not be allowed in the C1, D1, D2, and other commercial districts.

Currently, drive-thrus are allowed in C3 districts without a special exception use. They are allowed as special exception uses in the C2B district.

When considering whether to grant a special exception use – which does not require additional city council approval – the planning commission considers these issues:

1. Is the location, size and character of the proposed use compatible with the principal uses of the district and adjacent districts? Is it consistent with the Master Plan? Is it consistent with the surrounding area? Will it have any detrimental effects to the use or value of surrounding area, or the natural environment?

2. Is the location, size, character, layout, access and traffic generated by the use hazardous or inconvenient or conflicting with the normal traffic of the neighborhood? Is off-street parking safe for pedestrians? Do the necessary vehicular turning movements block normal traffic flow? Are any additional public services or facilities needed by the use, and will they be detrimental to the community?

3. Is the maximum density and minimum required open space at least equal to the standards normally required by the Zoning Ordinance for the district?

The planning commission recommended the changes at its April 1, 2014 meeting.

The proposed amendments were first reviewed by the commission’s ordinance revisions committee in 2007, but never moved forward to the full commission for consideration. The ORC most recently reviewed these changes in March of 2014. [.pdf of staff memo and proposed amendments]

Ruth’s Chris Site Plan

The site plan for a new Ruth’s Chris Steak House on Fourth Avenue in downtown Ann Arbor is on the June 2 agenda for consideration. The planning commission recommended approval at its April 1, 2014 meeting.

Proposed facade of Ruth’s Chris Steak House at 314 S. Fourth Ave.

The site plan calls for renovating the single-story building at 314 S. Fourth Ave. and putting up a 1,943-square-foot second-floor mezzanine addition over the front part of the existing building. The current structure is 8,024 square feet, and most recently housed the Dream Nite Club, which closed in 2012. The project is estimated to cost $2.2 million. [.pdf of staff report on Ruth's Chris site plan]

Part of the planning commission’s discussion focused on whether there might be outdoor dining in front of the restaurant. The project’s architect indicated that at this point, outdoor seating wouldn’t be appropriate, in part because of bus traffic. The building is located near the Blake Transit Center, a hub for public transportation. The architect also indicated that the restaurant will be using valet parking, with valets positioned in front of the building.

This would be the first Ruth’s Chris Steak House in Ann Arbor. The chain is based in Florida, with locations nationwide.

Utility Rates

The council will consider giving final approval to higher utility rates – for water, sewer and stormwater. Initial approval came at the council’s May 19 meeting.

Water rates will increase across all tiers of consumption. For the first 7 “units” of water, the charge is will increase from $1.35 to $1.40. For the next 21 units, the charge is proposed to increase from $2.85 to $2.96 per unit. And for the 17 units after that, the increase is proposed to be from $4.88 to $5.08. A unit is 100 cubic feet, which is 748 gallons.

Sewer rates will increase from $3.65 to $3.85 per unit. And stormwater fees would increase for all tiers of impervious service. For the middle tier – for more than 2,187 square feet but less than or equal to 4,175 square feet – on a quarterly basis, the increase would be from $24.85 to $26.32.

According to the staff memo accompanying this agenda item, the recommended rate changes in water, sewer, and stormwater would increase revenues to the water, sewer, and stormwater funds by $765,119, $1,171,931 and $410,235 respectively. The reason given for the rate increases is to cover maintenance and debt payments, and to maintain funding for capital improvement requirements. The city calculates the impact to be an additional $6.25 per quarter or $24.98 per year for an average consumer, which is a net increase of 4.2%.

Water consumption for a typical single family is assumed at 19 units per quarter.

History of city of Ann Arbor water rates. The city converted to a tiered system 10 years ago in 2004, based on usage. The 2015 amount is proposed.

Grant to Farmers Market for Food Stamp Recipients

At its June 2 meeting, the city council will consider approval of an agreement with the Fair Food Network to continue administering the Double Up Food Bucks program at the Ann Arbor farmer’s market. Approval would entail acceptance of $32,000 in funding.

The Double Up name stems from the fact that it provides a match of up to $20/person/day for people using SNAP (Bridge cards/EBT/food stamps) to purchase Michigan-grown produce at farmers markets in Michigan.

The city of Ann Arbor has received Double Up Food Bucks grant funding since 2010.

Partnership with Community Action Network

A proposal for a five-year partnership with the nonprofit Community Action Network is on the June 2 agenda. The partnership was recommended for approval by the Ann Arbor park advisory commission at its May 20, 2014 meeting.

The agreement would be for CAN to continue operating the city’s Bryant and Northside community centers, which the nonprofit has been managing since 2008. The proposed amount is not to exceed $130,000 annually – an increase of $25,000 from the current agreement. The higher amount is included in the FY 2015 general fund budget for parks and recreation that the city council approved on May 19. According to a staff memo, the higher amount will address increases in fixed costs and “assist in retaining quality staff that is at the core of the services that CAN provides.” [.pdf of staff memo]

The staff memo also noted that a request for proposals (RFP) was not issued for this work, because CAN has been the sole respondent to the previous two RFPs and the city is satisfied with its work.

During the May 20 PAC meeting, CAN received praise for their work from several commissioners and Colin Smith, the city’s parks and recreation manager. CAN executive director Joan Doughty and deputy director Derrick Miller were on hand to answer questions. Part of the discussion focused on CAN’s exemption from the city’s living wage requirement, which the city council granted in 2012 for a three-year period through Nov. 8, 2015. Doughty noted that the exemption was sought in part because CAN was paying a living wage to part-time employees who were high school or university students, which limited the nonprofit from paying higher wages to full-time workers. She also pointed out that the city parks and recreation unit isn’t required to pay the living wage to its seasonal workers.

LDFA Extension

On the council’s June 2 agenda is an item that would express city council support of the local development finance authority’s application to the Michigan Economic Development Corp. to extend the life of the tax capture arrangement for up to 15 years. Without an extension, the LDFA would end in 2018.

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

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

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

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

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

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

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

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