The annual electric bill from DTE for the 223 streetlights is currently $45,128. After conversion, the projected annual cost will be $30,910. The savings would result in about a 3.1-year payback period on the net cost of $55,060. City council action came at its June 16, 2014 meeting.

The city is billed for 7,431 streetlights – of which 5,216 are DTE-owned. Of the 2,215 city-owned lights, 1,923 have LED fixtures.

None of the streetlights to be converted under the agreement ratified on June 16 are in the Ann Arbor Downtown Development Authority tax capture district. Streetlights in the DDA district were part of a similar proposal considered by the DDA board at its May 7, 2014 meeting, but postponed by the board at that meeting until June 4. By the time of the June 4 meeting, however, a decision had already been made that the DDA would not be funding an LED conversion this year. [DTE's program has an annual cycle, but is not necessarily offered every year.] If the DDA board had approved funding for converting lights in the DDA district, it would have affected 212 non-LED streetlights.

Streetlight locations are mapped in the joint Washtenaw County and city of Ann Arbor GIS system. Data available by clicking on icons includes ownership as well as the lighting technology used. This one is a high pressure sodium light operating at 400 watts.

The project the DDA declined to fund this year would have included converting 100 watt MV (mercury vapor), 175 watt MV and 100 watt HPS (high pressure sodium) lights to 65 watt LED (light emitting diode). Further, 400 watt MV and 250 watt HPS lights would have been converted to 135 watt LED. Finally, 1000 watt MV and 400 watt HPS lights would have been converted to 280 watt LED. Currently, the city pays DTE $72,585 a year for the energy used by the 212 downtown streetlights. After conversion, the annual cost for the 212 lights would be expected to drop to $51,895, for an annual savings of $20,690.

In deliberations at the DDA board’s May 7 meeting, DDA board member Roger Hewitt opposed the grant, because the savings that would be realized accrues to the city of Ann Arbor, which pays the energy bills for the lights. Hewitt noted that the relationship between the city and the DDA includes a number of fund transfers to the city. Even though the amount is not huge, Hewitt said, the expenditure of several small amounts could eventually impair the DDA’s ability to pay for major infrastructure improvements.

Other board members joined Hewitt in their concerns, questioning what projects might be sacrificed if the DDA paid for the LED conversion. Concern was also expressed over the possibility that the result of a streetscape framework planning effort could result in a decision to replace all cobrahead lights in the downtown area with pedestrian-scale lampposts. And that would mean that the new LED fixtures would be used for only a short while.

For deliberations at the council’s June 16 meeting, see The Chronicle’s live updates filed during the meeting.

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

Mary Jo Callan, director of Washtenaw County’s office of community and economic development, explained to the DDA board what the affordable housing needs assessment would entail. The board voted to approve $37,500 for the study. (Photos by the writer.)

One was a $37,500 grant from the DDA’s housing fund to help pay for an affordable housing needs assessment to be conducted by Washtenaw County’s office of community and economic development. The other was a routine end-of-year budget adjustment that included the $37,000 grant as well as $500,000 of previous allocations made to the Ann Arbor Housing Commission, and a $1.6 million payment for the First & Washington parking garage that was made out of this year’s budget instead of the previous year’s budget.

In other voting business, the board approved up to $125,000 for the redesign and reconstruction of the public sidewalk in front of the Ann Arbor District Library’s downtown location on Fifth Avenue. That money will come from next year’s (FY 2015) budget, starting July 1. The project will eliminate the step up immediately adjacent from the curb, which was installed as a result of the streetscape changes the DDA undertook during construction of the Library Lane underground parking garage in 2012. The sidewalk project will be incorporated into an AADL project that will substantially renovate the front entrance to the building.

The final item of voting business considered by the board was adoption of a policy for DDA grants to private developments. The policy establishes criteria for eligibility – which include public benefit to property outside the development. The policy also covers limits on the amount of funding, which is a portion of the additional TIF revenue generated by a project.

A resolution that had been postponed at the board’s May 7, 2014 meeting until the June 4 meeting did not receive any board action – a request to pay about $100,000 for the conversion of streetlights in the DDA district to LED technology. The board did not vote on the item. It did not appear on the board’s agenda as a resolution, but only as an update. That update consisted of remarks from executive director of the DDA Susan Pollay. She informed board members that as a result of conversations she’d had with city staff, they should consider the item tabled, but that the request might be brought back in the future.

The board also received its usual range of updates and reports from committees.

Affordable Housing Needs Study

The board considered allocating $37,500 for a housing needs assessment in Washtenaw County to be conducted by the county’s office of community and economic development. The total budget for the project is $150,000.

The firm selected by the county’s office of community and economic development (OCED) to do the needs assessment is czb LLC out of Virginia. [.pdf of RFP for the needs assessment] The current needs assessment will update a report done in 2007.

According to a memo from OCED staff to the DDA, the final report will “provide a clear, easy to understand assessment of the local housing market, identify current and future housing needs, and provide specific and implementable policy recommendations to advance affordable housing. The goal for this update is to include an analysis that links transportation cost and accessibility, as well as other environmental and quality of life issues to the location of affordable housing.”

The RFP for the needs study describes the timeline for the work as including a draft for review due at the end of October 2014, with a final presentation due in mid-December.

In addition to the DDA grant, money to cover the complete cost of the study will also come from a HUD Sustainable Communities Grant ($75,000) and a possible contribution recommended by the city of Ann Arbor’s housing and human services advisory board (HHSAB). The board is advisory, so the actual appropriation – from the city’s affordable housing trust fund – would need to be approved by the city council. That approval is scheduled to appear on the council’s June 16 meeting agenda.

In 2005, the DDA board voted to approve $15,000 for the housing needs assessment that the county undertook around that time.

Affordable Housing Needs Study: Board Deliberations

Joan Lowenstein introduced the resolution on grant funding for the housing needs assessment. The DDA is being asked to contribute $37,500 to support the affordable housing needs assessment, she said. The study would be useful to the DDA as well as to all the other governmental units, she said – because they would then not be operating “in the dark.” When they are asked to provide support for affordable housing, they would know what the needs actually are. They would not then have to put money into a pot without knowing what that pot of money would eventually support. The study would establish what the housing needs are in the community, she said.

Lowenstein continued by saying that this report would also consider workforce housing. When affordable housing is discussed in this community, she continued, people often think of below-poverty kind of housing, but this study will also be looking at workforce housing. Lowenstein invited Mary Jo Callan, director of Washtenaw County’s office of community and economic development, to the podium to briefly describe the study.

Callan described this current study as an update of a previous needs assessment. Following up on Lowenstein’s comments about workforce housing, she allowed that it was important to include a range of different affordable housing types. Affordability varies, depending on income, she said, and it’s important to include the workforce strata.

A consultant has been retained to do the study, Callan reported. The consultant was chosen because of his familiarity generally with doing affordable housing assessments – and understanding how markets work – and specifically for that type of analysis in college towns. That’s important for Ann Arbor, as a college town, she said. She expected it to be a significant undertaking – with lots of community engagement, lots of meetings and focus groups with stakeholders. The final report would be done in the fall, she said.

As Lowenstein had pointed out, Callan added, we know we need affordable housing – but it’s important to put some numbers on that. How much? For whom? Located where? She noted that she works for Washtenaw County, but each community in the county has particular needs with respect to affordable housing. The report will highlight some specific areas, she said. One of those specific areas will be the Ann Arbor DDA district. The city of Ann Arbor will also be a specific area focused on in the report. Ypsilanti and Pittsfield Township will also be highlighted as communities with specialized needs.

The study will also include an analysis of transportation as it relates to affordable housing, Callan continued. Access to transportation is critical. Affordable housing is great, she said, but it is only great if it provides access to jobs and other needs. The previous study had not included consideration of how transit affects affordable housing, Callan said.

John Mouat highlighted the fact that out of a budget of $150,000, the Ann Arbor DDA was a 25% stakeholder. Half of the amount would be provided by the HUD sustainable communities grant. And another quarter of the amount would be provided through the city’s housing and human services advisory board, he said. He also stressed the fact that the amount is an “up to” amount.

Callan agreed that it was an “up to” amount – which was important for the DDA board to know. She continued by saying that the $75,000 from the HUD sustainable communities planning grant would definitely be used for the study. And the cost of the entire study is currently pegged at about $92,000. However, she expects – as with any major community undertaking – additional components of the study could be added, including additional outreach and engagement. So while the amount is an “up to” amount, she aims to bring the study in under that amount.

Responding to a question from Lowenstein, Callan described the timeline as starting immediately as far as engaging with the consultant. The community engagement process would start very soon, she said. There would be a couple of major planned community engagement events, probably in September and October. She is shooting for the end of November for a final report, she said, but in any case by the end of the year it would be done.

Outcome: The board unanimously approved $37,500 for the affordable housing needs assessment.

Routine Budget Maintenance: FY 2014

The board considered routine annual budget adjustments totaling about $2 million. The amendments are typically made each year towards the end of the fiscal year to ensure that expenditures do not exceed appropriated amounts – in compliance with Public Act 621 of 197. The Ann Arbor city council undertook a similar action at its May 19, 2014 meeting.

The main part of the adjustment was a $1.6 million payment made for the First & Washington parking garage, which is part of the City Apartments project. The amount was budgeted for last year, but not paid until this year.

The rest of the adjustment was attributable to expenditures out of the housing fund – $500,000 of it to support Ann Arbor Housing Commission projects. The remaining $37,500 went to support a countywide housing needs assessment – an amount that was approved by the board in a separate vote.

The DDA will end the fiscal year with $6,167,757 in fund balance. The breakdown of that total is: TIF ($619,571); Housing ($160,154); Parking ($2,161,676) and Parking Maintenance ($3,226,356).

Routine Budget Maintenance: FY 2014 – Board Deliberations

Roger Hewitt introduced the item, saying that state law requires that the budget be amended so that expenses don’t exceed allocations in the budget. There were two areas in which the DDA has “overspent” this year, he explained. In the detail of the parking budget, he noted, there is a $1.6 million increase in the budget for the First & Washington parking structure.

DDA board member Roger Hewitt.

That’s the final cash payment for that structure, he noted. The reason the budget needs to be amended is that the expenditure had been budgeted for the previous fiscal year. The DDA could not make that payment until the certificate of occupancy for the parking garage had been issued. He described it as money that had not been spent last fiscal year and was being spent this fiscal year instead.

The other area where the DDA had “overspent” was in the housing fund, Hewitt said. After the budget had been set, there’d been a request from the Ann Arbor Housing Commission for several projects, he noted. Those projects totaled $500,000. Also a part of the mix was the $37,500 the board had approved at the same meeting for the affordable housing needs assessment study.

John Mouat drew out the fact that the Ann Arbor Housing Commission projects were at Baker Commons and Miller Manor, which are either in or near enough to downtown to fit the criteria the DDA applies for its housing fund investments.

Outcome: The board approved the fiscal year 2014 budget adjustments.

AADL Sidewalk Improvement

The board considered providing $125,000 of funding associated with a redesigned entrance to the Ann Arbor District Library on Fifth Avenue in downtown Ann Arbor. The money will be put toward the redesign and replacement of the public sidewalk along the east side of Fifth Avenue, between William Street and the entrance to the Library Lane parking structure.

The goal of the sidewalk redesign is to eliminate the step that was installed at the curb, when Fifth Avenue was regraded in connection with construction of the underground Library Lane parking structure, which was completed in the summer of 2012.

This is the step near the curb on the east side of Fifth Avenue in front of the downtown location of the Ann Arbor District Library. The step will be eliminated as part of a renovation project to the front entrance. The DDA will be funding up to $125,000 of the cost of the improvement to the public sidewalk.

At its most recent meeting, on May 19, 2014, the Ann Arbor District Library board authorized the library director, Josie Parker, to negotiate with Ann Arbor-based O’Neal Construction Inc. for work related to the downtown library entrance. O’Neal would be contracted to provide construction management services. This is the next step in a process that began several months ago, stemming from the need to replace the entrance doors.

At its April 21, 2014 meeting, the AADL board had authorized Parker to hire a construction manager for the project. At that meeting, trustees also allocated $18,580 from the fund balance to pay InForm Studio for construction documents. InForm Studio, the architecture firm that previously designed AADL’s Traverwood branch, gave an update on the process at that same meeting.

The existing teal porcelain panels that wrap around the front facade, part of architect Alden Dow’s original design from the mid-1950s, will be replaced with a “concrete skin” panel. The entrance will continue to be oriented to South Fifth Avenue, with new doors into the building. Leading from the front of the building into the vestibule will be two balanced double doors, which will be easier to open than the existing entry, and a single automatic door. A matching set of these doors will lead from the vestibule to the interior of the building. A heated sidewalk is proposed along the exterior edge of the steps.

The new design also will address accessibility concerns that have been raised by the public. Concerns about the grading and steps on the public sidewalk had been brought up as issues that affect accessibility.

The overall library entrance project is expected to cost about $250,000.

AADL Sidewalk Improvement: Board Deliberations

John Splitt introduced the item. He said when the DDA had built the Library Lane underground parking structure, Fifth Avenue had been regraded – something that needed to be done for water flow and drainage. The level of the street had been changed, and the difference in elevation had to be dealt with near the entrance to the Ann Arbor District Library. So that was dealt with by adding a step, Splitt said. That step has never been terribly convenient for anyone, he said. But now the library is renovating its front entrance. The DDA has been asked to get rid of that step, he continued, saying it was right that the DDA had been asked to do that.

The resolution that the board was considering would allow the DDA to pay for the part of the project that’s in the public right-of-way, Splitt explained. The DDA is not doing the work itself, he continued. The original amount considered by the committee was $100,000, he said, but in the course of committee discussion, they had increased the amount to $125,000 to accommodate any needed enhancements. In the long run, he felt, the cost would be less expensive than that, noting that it was an “up to” amount.

Roger Hewitt pointed out that the Ann Arbor District Library was one of the taxing authorities from which the DDA captures taxes.

Keith Orr supported the resolution, saying it is well within the DDA’s wheelhouse, as it involved infrastructure. Joan Lowenstein asked if the mechanical parking meters that are currently in place would be reinstalled, or if kiosks could be installed. Splitt said he assumed that the mechanical parking meters would be used for the time being.

Susan Pollay, executive director of the DDA, indicated that they are waiting to see what happens when the new Blake Transit Center opens – as the traffic flow will be reversed from what it was previously. When the center was located on the Fourth Avenue side of the block, buses entered from Fifth Avenue and exited onto Fourth Avenue. When the new driveway opens, expected in the next few weeks, buses will enter from Fourth Avenue and exit onto Fifth Avenue. It’s not clear how many of the parking spaces can remain, she said. Once more is known, then a decision can be made on the equipment, she said.

Splitt noted that the general strategy will be to replace the old-style meters.

Rishi Narayan asked, from a budget standpoint, if there was any consideration given to what projects this one might be replacing that already been budgeted for. Roger Hewitt responded to the question by saying that in a larger sense, the DDA has money allocated for sidewalk work. The DDA was holding off on decisions about where that sidewalk work might take place, until the streetscape framework plan is completed. Once that framework plan is in place, the DDA can begin to prioritize, he said.

Hewitt characterized the library sidewalk project as “jumping the queue” – although he said there really is not a queue of projects at this point. He summarized by telling Narayan that yes, there is money in the budget for this project, although it has not been allocated to specific projects. Money was not being taken away from some specific project.

John Mouat asked Splitt for some detail about the plans for the redesign of the library’s entrance: “How does the step magically disappear?” Pollay explained that the entire area in front of the library’s entrance is going to be recreated. Instead of the current two steps up into the entrance, there will be four steps, she said. That will allow the portion of the sidewalk that is near the street to be flat, she said. When the work was being done on the streetscape in connection with the underground garage construction, it was not possible to address that issue.

Mouat ventured that it was possible to view this sidewalk work as an unfinished phase of the reconstruction of Fifth Avenue. He indicated that when the step had been installed, everyone hoped that it would be a very temporary installation. Splitt summarized the results of the project as making the elevation change on library property and not in the public right-of-way.

Outcome: The board unanimously approved the $125,000 for the library sidewalk project.

Partnerships Grant Policy

The board considered a policy on granting financial support to private developments. [.pdf of DDA partnership grant policy]

The development of the policy was spurred by a request from First Martin Corp., which has asked the DDA to support its extended-stay hotel project at the corner of Ashley and Huron streets. That location is within the DDA district.

Highlights of the policy include a limit on the amount, keyed to the amount of tax increment finance (TIF) revenue the project will generate: “… calculated to be between 1% and 25% of the ten year TIF captured by the DDA from this project, with these funds to be directed to the cost of the public improvements agreed to by the DDA.”

Criteria for awarding grants include:

1. Addresses a documented gap in the marketplace or underserved markets of commerce within this sector of downtown.
2. Demonstrated that the project will act as a catalyst for additional revitalization of the area in which it is located which will trigger the creation of additional new tax revenue.
3. Is “connected” to the adjacent sidewalk with uses on the first floor that are showcased using large transparent windows and doorways to give pedestrians a point of interest to look at as they walk by the project.
4. Creates a large office floor plate.
5. Will facilitate the creation of a large number of new permanent jobs.
6. Is a mixed use development, that will encourage activity in the daytime, evening, and weekend, such as a development with a mix of commercial and residential.
7. Adds to downtown’s residential density.
8. Reuses vacant buildings, reuses historical buildings, and/or redevelops blighted property.
9. Number of affordable housing units created on site or funded by the project elsewhere in the community, which are beyond what is required by the city.
10. Environmental design is at or above a Gold LEED certification, or an equivalent environmental assessment.
11. Architecturally significant building or project design.
12. Strengthens Ann Arbor’s national visibility.

The grant policy considered on June 4 is similar to but distinct from a policy the board adopted at its June 6, 2012 meeting to cover brownfield grants – a policy that was spurred by the 618 S. Main project. [.pdf of brownfield policy]

Partnerships Grant Policy: Board Deliberations

Joan Lowenstein introduced the grant policy item on the agenda. The board has been discussing this for quite a long time, she said. She described the DDA grant program as “lying dormant” for a long period. The policy would structure how the DDA works with private developers, she said. Some guidelines need to exist, she explained, because it can’t be done simply “catch-as-catch-can.”

The policy sets out guidelines, based in part on the DDA’s brownfield grant policy. But Lowenstein stressed that this policy goes in a different direction from the brownfield grant policy. Specifically, this policy begins by asking the question: What can this developer do for us and our downtown and the rest of the community? So the policy incorporates criteria for how a developer can be eligible for grant support. More than just the developer’s own site has to be included in the benefit, she said. “In that sense it is a partnership, not simply a gift,” she said.

Amber Miller, the DDA’s planning and research specialist, was invited to comment by Lowenstein. Miller described two areas where she’d work on the policy with city staff. First, they had focused on the eligible improvements section of the policy. They’d identified opportunities for project elements that are not typically required of a site plan. Second, her work with city staff had also focused on the process by which the grants could be applied for. She noted that it would be helpful to have a grant application reviewed at the same time that city staff reviewed a project. That would be the perfect time for city staff to identify additional public improvement opportunities.

Roger Hewitt ventured that based on the wording of the policy, any residential project would qualify. Back-and-forth between Miller, board chair Sandi Smith, and John Mouat established that the inclusion of residential units was just one of many criteria for eligibility, and was not necessarily a sufficient criterion. Hewitt did not want every student housing project to qualify automatically. Lowenstein characterized the criteria as a “package.”

Mouat noted that the list of criteria was finite – and as the program continues for a number of years, it might be important to remove some items from the list or to add items. For example the need for large office floor-plate space was high right now, but after more of that type of space is built, it might not continue to be a priority.

DDA executive director Susan Pollay said the policy would be reviewed on an ongoing basis – as the city’s priorities change and as developments change. Mouat expressed concern that there might not be enough on the list to get developers interested. Pollay described how the DDA at one time had a façade improvement program – and the same concern had been registered at that point. Not much has been heard about the façade improvement program in the recent past, she continued, and that’s because there was no development interest. These DDA programs are not meant to supplant market forces – but rather are meant to be supportive of the DDA’s goals, she said.

Al McWilliams inquired about a limitation on the number of grants that could be awarded any given year. Smith explained that payment on any grant would be made only after the property owner had paid all the property taxes due. The grant would never be paid ahead of the taxes, she said. For that reason, she said it is not a typical rebate, but rather a grant based on the payment of taxes.

City administrator Steve Powers characterized the policy that was before the board as much improved over previous drafts. Lowenstein said it was helpful to have this policy coordinated with the city’s capital improvements plan – a change she felt was really helpful.

Outcome: The board unanimously approved the grants policy.

DTE LED Conversion

The board’s May 7, 2014 meeting included a resolution that asked the board to consider paying $101,733 to DTE for converting 212 mercury vapor and high-pressure sodium streetlights in downtown Ann Arbor to LED technology.

The board voted at that meeting to postpone a decision until its June 4, 2014 board meeting.

DTE LED Conversion: Background

In 2007, the DDA had previously granted $630,000 for conversion of 1,400 other streetlights in the DDA tax capture district.

Streetlight locations are mapped in the joint Washtenaw County and city of Ann Arbor GIS system. Data is available by clicking on icons includes ownership as well as the lighting technology used. This one is a high pressure sodium light operating at 400 watts.

The 212 streetlights that haven’t yet been converted are owned by DTE, which would be undertaking the work. Currently, the city pays DTE $72,585 a year for the energy used by the 212 streetlights. After conversion, the annual cost for the 212 lights is expected to drop to $51,895, for an annual savings of $20,690.

After an EO (energy optimization) rebate of $10,224, the $91,509 cost would be recovered in just under 4.5 years.

The project would include converting 100 watt MV (mercury vapor), 175 watt MV and 100 watt HPS (high pressure sodium) lights to 65 watt LED (light emitting diode). Further, 400 watt MV and 250 watt HPS lights would be converted to 135 watt LED. Finally, 1000 watt MV and 400 watt HPS lights would be converted to 280 watt LED.

DTE LED Conversion: June 4 Meeting

Susan Pollay, executive director of the DDA, told the board that at the previous month’s [May 7] meeting, she’d put forward a request to the board to consider a grant that would enable converting the remaining non-LED streetlights downtown to LED technology.

Some very valid points were raised by the board members, she said, which she’d taken back to a meeting with city staff. In that conversation, city staff had seen merit in both of the points. The first question concerned how the streetlight conversion project lines up with other priorities in the city’s capital improvements plan (CIP). About that, Pollay reported that “there was a lot of resonance for that question.”

The second question was how the streetlight conversion project lines up with the streetscape framework plan, which is not yet completed: “And that also had resonance with staff,” Pollay said. As part of the development of the streetlight framework plan, she said, we might decide as a community that the goal is to remove all of the cobra-head lights downtown – that we’d like to have all of downtown be lit with pedestrian-scale lighting, she said. And to make an investment at this point – before the DDA finishes that planning process – really didn’t make much sense, she continued.

Staff had “resonated with your questions,” Pollay told the board. So she’d put that board resolution on hold: “So effectively, that resolution you saw before, you should assume is tabled – not permanently, certainly, until after the framework plan,” she said. “If we feel it is important, we will bring it back.”

By way of additional background, in order to take advantage of this year’s funding cycle from DTE – which has a deadline of June 30 for application – the city’s energy office has developed a revised proposal for converting streetlights not in the DDA district. That proposal, to convert 223 mercury vapor lights to LED technology, is scheduled to be on the city council’s June 16, 2014 agenda. The net cost to the city for that conversion is $55,060, with an expected payback period to the general fund of 3.1 years.

Communications, Committee Reports

The board’s June 4 meeting included the usual range of reports from its standing committees and the downtown citizens advisory council.

Comm/Comm: Connector Study

Roger Hewitt reported out on the status of the connector study. [By way of background, an alternatives analysis is currently being conducted by the Ann Arbor Area Transportation Authority for the corridor running from US-23 and Plymouth southward along Plymouth to State Street, then further south to I-94. The alternatives analysis phase will result in a preferred choice of transit mode (e.g., bus rapid transit, light rail, etc.) and identification of stations and stops.]

The technical oversight committee had met the previous day, Hewitt said. They met with an expert on federal transportation administration (FTA) funding. The ultimate hope of the project, he continued, is that half of the construction funds will come from a federal grant. The expert had provided the committee with a lot of good ideas about how to request grant funding for the next phase of the project – which is the environmental impact study.

The expert had also provided ideas about how to request funding for the construction phase of the project, Hewitt reported. The expert had reviewed the projections of ridership 20 years into the future for this particular corridor, and characterized the numbers as “phenomenal,” Hewitt reported. This would easily be one of the top candidate projects for federal funding, as measured by the cost of the project compared to prospective ridership.

The expert had suggested that some FTA officials be invited to visit the city in the fall, when the University of Michigan students are back, because the FTA will not believe the numbers – they would have to see it for themselves. There’s a public meeting planned for Sept. 17, Hewitt reported. That will take place in the evening at the Ann Arbor District Library to bring the public up to date about the conclusions of the alternatives analysis.

Comm/Comm: Zoning Revisions

Reporting out from the downtown area citizens advisory council, Ray Detter said the group had reaffirmed its support for the city council’s decision to review the downtown zoning, to “correct mistakes that were made in the past.” He said that the previous month, some members of the citizens advisory council had spoken during public commentary at a recent meeting of the planning commission, which had voted unanimously to recommend a change in the zoning of the parcel on the southeast corner of Main and William streets – from D1 to D2. The CAC had supported that change, but had objected to another change associated with the same parcel – which allowed a height of up to 100 feet, instead of the 60 feet associated with other areas of the downtown that are zoned D2.

Detter said he believed that a “planned project” approach would be better than increasing the allowable by-right height in the zoning to 100 feet. Detter said the CAC supported the hiring of a competent urban planning professional to advise the city council and planning commission on ways to make decisions involved in shaping the final recommendations on zoning ordinance changes.

During communications time, Roger Hewitt responded to Detter’s comments made during the initial public commentary of the meeting, saying that past zoning is not necessarily a mistake – it could simply be a difference of opinion. A change in the zoning does not mean that the past zoning was a mistake, he stressed. It might mean that the views of the public have changed. Hewitt reminded everyone that he had served for three years on the A2D2 study committee, which resulted in the zoning changes adopted in 2009. So Hewitt objected to the outcome of those recommendations being referred to as a “mistake.”

Comm/Comm: Footing Drain Lawsuit

As part of his report from the downtown area citizens advisory council, Ray Detter said the group had spent some time discussing the status of the footing drain disconnection lawsuit that is currently pending against the city. The outcome of that lawsuit could affect the downtown area, he said. He reviewed how the lawsuit had recently been sent back to Washtenaw County’s 22nd circuit court from the federal court, over the objection of Ann Arbor city attorneys.

The footing drain disconnection ordinance, he continued, established a program under which property owners could be required to disconnect their footing drains from the city’s sanitary sewer system. The intent of the ordinance to diminish the risk of sanitary sewer overflows into the Huron River and sanitary sewage backups into homeowners’ basements.

Detter said he wouldn’t go into detail on the topic, but he summarized the essence of the lawsuit as involving inverse condemnation – the taking of private property without just compensation. If the lawsuit is decided against city, he continued, likely possibilities include the discontinuation of the footing drain disconnection ordinance and a discontinuation of the developer offset mitigation program. The developer offset mitigation program applies to every new development. Without that program in place, Ann Arbor’s sanitary sewer system would, he contended, be closed to new development.

The issue of inadequate sewage infrastructure in the city would have to be addressed, he said. If projects like 413 E. Huron are not able to mitigate sanitary in-flow, those projects would have to construct above-ground storage, he ventured. It could also have an impact on the University of Michigan’s new graduate dormitory, he said. The dorm is being constructed at the site of the former Blimpy Burger at Packard & Division.

Comm/Comm: Streetscape Framework Plan

John Mouat reported on a number of upcoming events related to the streetscape framework study. There will be a committee meeting on Tuesday, June 10 at 9 a.m. at the DDA offices. [At its Nov. 6, 2013 meeting, the board had authorized the consulting contract SmithGroupJJR and Nelson\Nygaard to manage the project.] There will also be a public meeting on June 12. The open house for the June 12 meeting starts at 6:30 p.m. with a presentation and feedback starting at 7 p.m.. That will be held at the Ann Arbor District Library’s downtown location at 343 S. Fifth Ave.

Comm/Comm: City’s FY 2015 Budget

City administrator Steve Powers updated the board on the fact that the city council had adopted the fiscal year 2015 budget at its May 19 meeting. The budget includes funding for three additional police officers – two of them for the city’s community engagement unit, and one for traffic enforcement. The budget also includes funding for an additional firefighter and an additional rental housing inspector. There’s also a one-time use of fund balance of $1 million dollars to address the backlog in maintenance on trees in the public right-of-way. The fiscal year begins July 1, 2014, Powers concluded.

Comm/Comm: Main Street Light Poles

Board chair Sandi Smith noted that the replacement of the Main Street light poles was well underway. From what she heard, there’s a significant difference in the brightness of the lights.

Comm/Comm: Communications, Marketing

Reporting out from the partnerships committee, Rishi Narayan said that the communications subcommittee had focused on a couple of different data items to help determine how best to market downtown. The key is how to help market downtown, not for the DDA to take sole responsibility for doing it, he said.

The idea is to help the downtown area associations and the Ann Arbor Convention and Visitors Bureau. He said the committee is currently exploring a couple of ideas. They’re waiting for some feedback on Ladies Night, which had been an attempt to increase sales and traffic at a time that was not normally high-traffic. It took place on May 9.

They’d come up with some pretty cool ideas about how to use parking data, Narayan said. They were looking at using a startup company in Ann Arbor to look at macro data on purchasing in the downtown. Narayan characterized the committee’s approach as multi-pronged. The committee wanted to get the most bang for the DDA’s buck, and did not want to simply invest money in various events, or into advertising or a website without having a metric by which to gauge success or failure.

Comm/Comm: Main Street BIZ

Keith Orr reported out from the partnerships committee on an update received from the Main Street Business Improvement Zone (BIZ).

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

Property owners immediately adjacent to the existing BIZ had been interested in participating, and the result of the vote among property owners was in favor of expansion. The expansion increases the geographic area of the Main Street BIZ by about 150%, he said.

The DDA had been asked to voluntarily contribute to the BIZ – something the DDA had already been doing for the Palio surface parking lot – even though the DDA is not assessed because it is a governmental entity, Orr said. Additional parking structures for which the DDA would be contributing a voluntary assessment would include the Kline Lot, the Fourth & William parking garage and the Fourth & Washington garage.

Comm/Comm: Sidewalk Maintenance

John Splitt reported that DDA executive director Susan Pollay and Joe Maynard [of Park Avenue consultants] had conducted a walk-around of the downtown to identify trip hazards and small maintenance issues with sidewalks. The budget for the work this year, which will take place over the rest of the summer, was about $75,000 or $100,000 dollars, Pollay thought. Splitt characterized the work as involving small concrete repairs, re-laying brick and those kinds of things.

Comm/Comm: TiniLite, Tiananmen Square

Changmin Fan introduced himself as the owner of TiniLite World. He told the board that he belongs to two countries – the United States and China. He noted that that very day – June 4, 2014 – was the 25th anniversary of the Tiananmen Square uprising. Up to 1,000 people were killed during that uprising, he said. The whole world had talked about it at the time, but it’s quiet now, he said. We should appreciate the democratic system that we have in the United States and in Ann Arbor, he said. He suggested that his company’s technology could be used to help solve social problems by providing a better means for communication.

Comm/Comm: Downtown Spring Party

Reporting out from the downtown area citizens advisory council, Ray Detter said the next day’s weather, on June 5, was going to be sunny and 70 F degrees for the annual downtown spring party, which he hosts at his home on North Division. He ventured that all of the candidates for city council and mayor would be in attendance, and said that everyone was welcome to come.

Present: Al McWilliams, Cyndi Clark, Bob Guenzel, Roger Hewitt, Steve Powers, John Splitt, Sandi Smith, Rishi Narayan, Keith Orr, Joan Lowenstein, John Mouat.

Absent: Russ Collins.

Next board meeting: Noon on Wednesday, July 2, 2014, at the DDA offices, 150 S. Fifth Ave., Suite 301. [Check Chronicle event listings to confirm date.]

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Streetlight locations are mapped in the joint Washtenaw County and city of Ann Arbor GIS system. Data available by clicking on icons includes ownership as well as the lighting technology used. This one is a high pressure sodium light operating at 400 watts.

The board delayed its vote until its June 4 meeting. DDA board member Roger Hewitt opposed the grant, because the savings that will be realized accrues to the city of Ann Arbor, which pays the energy bills for the lights. Hewitt noted that the relationship between the city and the DDA includes a number of fund transfers to the city. Even though the amount is not huge, Hewitt said, the expenditure of several small amounts could eventually impair the DDA’s ability to pay for major infrastructure improvements.

Other board members joined Hewitt in their concerns, questioning what projects might be sacrificed if the DDA paid for the LED conversion. But they opted to postpone the issue, so the board’s operations committee could review the proposal in more detail.

In 2007, the DDA had previously granted $630,000 for conversion of 1,400 other streetlights in the DDA tax capture district.

The 212 streetlights that haven’t yet been converted are owned by DTE, which would be undertaking the work. Currently, the city pays DTE  $72,585 a year for the energy used by the 212 streetlights. After conversion, the annual cost for the 212 lights is expected to drop to $51,895, for an annual savings of $20,690.

After an EO (energy optimization) rebate of  $10,224, the $91,509 cost would be recovered in just under 4.5 years. DDA board member Al McWilliams pointed out that the savings would accrue to the city, not the DDA, and argued the proposal should be evaluated just on the basis of its cost to the DDA.

The project would include converting 100 watt MV (mercury vapor), 175 watt MV and 100 watt HPS (high pressure sodium) lights to 65 watt LED (light emitting diode). Further, 400 watt MV and 250 watt HPS lights would be converted to 135 watt LED. Finally, 1000 watt MV and 400 watt HPS lights would be converted to 280 watt LED.

This brief was filed from the DDA offices at 150 S. Fifth Ave., Suite 301, where the DDA holds its meetings. A more detailed report will follow: [link]

Downtown Ann Arbor Main Street light pole on northeast corner of Main & William. Photograph is from the city of Ann Arbor, taken April 2012.

Based on the DDA board’s resolution, it’s the DDA’s expectation that the city of Ann Arbor will make up the difference of $216,000. The board’s action came at its July 3, 2013 meeting.

Responding to an emailed query from The Chronicle earlier this year, city of Ann Arbor staff indicated that in early 2012 two of the light poles fell – due to a structural failure at the base of the poles caused by rust. After inspection of all the poles, two additional light poles were deemed to be in immediate risk of falling and were also replaced.

The DDA’s resolution indicates that the city of Ann Arbor’s budget approval process this year had determined that the city would allocate $216,000 for the project. What the Ann Arbor city council actually did on May 20, 2013 was to alter the DDA’s budget by recognizing additional TIF revenues of more than $568,000, and shifting $300,000 of that revenue from the DDA’s TIF fund to the DDA’s housing fund.

The council’s resolution also recommended that the DDA spend $300,000 of its TIF fund on the Main Street light pole replacement. And in response to an emailed query from The Chronicle, city administrator Steve Powers indicated that the city council will be asked to act on the matter either at its July 15 or Aug. 8 meeting. At the July 3 DDA board meeting, DDA executive director Susan Pollay noted in her remarks to the board that if the board approved the resolution, at that point the council would be asked to act.

This brief was filed from the DDA offices at 150 S. Fifth Ave., Suite 301 where the DDA board holds its meetings. A more detailed report of the meeting will follow: [link]

Jim Kosteva (left), University of Michigan's director of community relations, and Mike Anglin (Ward 5) peruse the University Record before the meeting. This week's edition of the Record includes an article on the founding of the Peace Corps. On Monday, the council approved a street closing on Oct. 14 in conjunction with the 50th anniversary of the Peace Corps founding. (Photos by the writer.)

First, the council voted to discontinue a pilot program to turn off selected streetlights. The program was designed to save $120,000 for the current fiscal year’s budget [FY 2011]. No additional streetlights will be turned off, and those that were switched off as part of the pilot program will be turned back on.

And the council voted to authorize the issuance of $9 million in general obligation bonds in connection with the parking deck to be built as part of Village Green’s City Apartments project at First and Washington. The bonds could take the form of conventional tax-exempt bonds, or other bonds, depending on which are legally available and most advantageous to the city when they’re issued. The bonds won’t be needed until the construction of Village Green’s project is completed.

In 2008 the Ann Arbor Downtown Development Authority passed a resolution authorizing that the bond payments be made from revenues generated by the city’s public parking system, which is managed by the DDA. The city council approved an extension to the purchase option agreement for the land at its Aug. 5 meeting.

Two expected votes did not take place. Revisions to the city’s zoning code that would change the specifications for area, height and placement in most zoning districts of the city outside the downtown were postponed at the request of Marcia Higgins (Ward 4), who said that she had questions she’d been unable to submit in time to get answers.

And in the absence of Sandi Smith (Ward 1) and Stephen Rapundalo (Ward 2) – who arrived late to the meeting – Tony Derezinski (Ward 2) asked for postponement of a five-year extension of the 2007 consent judgment the city reached with Joseph Freed and Associates LLC, developer of the Glen Ann Place project.

Glen Ann Place was a planned unit development (PUD) approved by the council in July 2005, but that did not win subsequent approval from the city’s historic district commission. Freed then filed suit against the city, the outcome of which was a consent judgment. Per the consent judgment, the height of the building was reduced from 10 to 9 stories. Glen Ann Place is planned to include retail and office uses on its first two floors, with residential on upper stories.

In other business, the council approved a handful of recommendations for liquor licenses, approved a rezoning for the land where the University of Michigan’s new soccer facility has been built, and approved an overhauling of the ordinance that governs how false alarms to fire and police are penalized.

The council also received a variety of updates from staff, including one on the traffic control plan for the East Stadium bridges when they are reconstructed next year, as well as a response from the city’s CFO to recent community discussion of significant unpaid taxes that might be owed to the city.

The city council also accepted a gift on behalf of the city from the Ann Arbor Summer Festival – a giant print of a photograph by Myra Klarman.

Streetlights

Before the council was a resolution to reverse course on a previous decision council made when it approved the budget for the current fiscal year, FY 2011, at its May 17, 2010 meeting. As part of the city administrator’s budget proposal, the city was to begin turning off 17% of the city’s streetlights in areas that by lighting standards were “overlit.” The move was expected to save the city $120,000 a year.

During deliberations back in May on a revision to the budget – to allocate some of the $2 million paid by the DDA to the city to parks mowing – Sandi Smith (Ward 1) saw the issue as one of public safety versus parks maintenance. From The Chronicle’s May 17, 2010 meeting report:

Sandi Smith (Ward 1) was not convinced that mowing and trimming in parks was the best use of the money. She was looking ahead to another amendment that proposed to undo the proposed de-energizing of some streetlights. She said she saw it as a safety versus shagginess-in-the-parks issue.

After the parks mowing amendment was approved over Smith’s dissent, she later proposed an amendment of her own, that would keep all the streetlights on. She got support for the idea from her ward-mate, Sabra Briere (Ward 1), as well as Stephen Kunselman (Ward 3) and Tony Derezinski (Ward 2). From The Chronicle’s meeting report:

Tony Derezinski (Ward 2) worried about the possibility of de-energizing streetlights. He thought it was perhaps a highway exception to general governmental immunity. Public services area administrator Sue McCormick noted that there was variability in lighting already – some residential areas have no lighting, some of them had lighting just at the street corners. She also noted that the areas where the de-energized lights were proposed were already lighted at twice the standard. Mayor John Hieftje asked if it was possible to get a demo.

Stephen Kunselman (Ward 3) said he was apprehensive about the designation of certain areas as “overlit.” He indicated that there were certain areas of the city classified as overlit that he did not find to be overlit. Hieftje indicated he would not support the amendment but would support a demonstration. He said he was concerned about the $120,000 that would need to come out of the city’s reserve, if the city did not go through with turning off some of the streetlights.

Outcome: The amendment to keep all the streetlights on failed, with support only from Briere, Derezinski, Kunselman, and Smith.

On Monday night, the resolution to cease the demonstration/pilot program and to turn the lights back on was sponsored by mayor John Hieftje and Christopher Taylor (Ward 3). The pilot program had been conducted in the general neighborhood where the two men live, and they’d made a nighttime field trip with neighbors, which Taylor had reported on at the council’s July 19, 2010 meeting:

Communication: Streetlights

Christopher Taylor (Ward 3) reported on a field trip at night he’d made with neighbors of the Brockman area to assess the initial result of a city program to deenergize some streetlights in order to save money. The measure was approved as part of the city’s FY 2011 budget, adopted in May 2010, and is expected to save around $120,000. The reaction of neighbors, Taylor said, was uniform: “They did not care for it.”

On Monday night, it was Taylor who introduced the resolution. Kunselman indicated he supported it. He noted that in many neighborhoods, given the large setbacks from the street, and the tree canopy, the porch lights from houses were not adequate illumination for sidewalks. Regarding the residents who complained about the lights being turned off, he said, they had “every right to be discombobulated.”

Mike Anglin asked if it might not be possible to lower the height of the streetlights to gain better illumination under the tree canopy. Hieftje pointed out that many of the lights are owned by DTE and there was considerable expense associated with changing the height of the lights.

Kunselman inquired about a possible city council work session with DTE. In the course of the conversation, Sue McCormick and Andrew Brix, the city’s energy programs manager, clarified that DTE is regulated by the Public Service Commission (PSC) and that DTE proposes rates that must then be approved by the PSC.

By way of background, rates are particularly relevant to streetlights, because they are not metered for actual energy used. Rather, a rate is determined based on the number and kind of lights. With newer, more energy-efficient lighting technologies like LED bulbs, even though less electricity is used by them, there is no cost savings, unless there is a rate established for the bulbs.

Brix explained that in January of 2010, the PSC had required all utilities to file an LED streetlight rate with the commission. From The Chronicle’s background provided in one of the spring budget meeting reports ["Budget Round 4: Lights, Streets, Grass"]:

According to Michigan Public Service Commission spokeswoman Judy Palnau, the MPSC issued an order on Jan. 11, 2010 that required DTE to file an application with MPSC seeking approval of rates on un-metered streetlights that would accommodate newer lighting technologies. The deadline for submission was Feb. 10, 2010. However, the issue of these LED rates is still pending at the MPSC.

At Monday’s meeting, however, Brix said that DTE had not articulated a rate in terms of “here’s your equipment, here’s your cost” but rather had provided a paragraph indicating a willingness to work with customers on installation of alternative lighting technologies.

Brix then described a limited pilot program in which 58 lights had been converted to LED bulbs in cooperation with DTE, where half the cost had been shared by DTE – otherwise, the conversion would not have made sense to the city from the expense side. The area of that 58-light LED pilot, said Brix, was bounded roughly by Hill, Packard, and East University.

Related to a different streetlight project, Brix also confirmed that the city had initially had trouble getting credit for an agreed-upon reduced rate for LED streetlights installed in downtown Ann Arbor. However, he reported that communication was now better and that the city had been back-credited, so the city had been “made whole,” he said.

Carsten Hohnke (Ward 5) noted that there is also an LED streetlight installation in the Glendale area, and that the residents are extremely satisfied. Prompted by Hohnke, Brix confirmed that with LED technology, there is considerable flexibility to choose the spectrum of lighting – the city opts for a rough equivalent of “moonlight” – as well as 0-100% dimming.

Marcia Higgins (Ward 4) got confirmation that the new streetlights being installed on Stadium Boulevard between Pauline and 7th are owned by the city. She noted that the residents along the corridor had voted for a different lighting intensity to distinguish the residential section from the commercial district.

Bonds for Village Green’s City Apartments

Before the council was a proposal to authorize issuance of $9 million in general obligation bonds in connection with the parking deck to be built as part of Village Green’s City Apartments project at First and Washington.

The bonds could take the form of conventional tax-exempt bonds, conventional taxable bonds, Build America Bonds, Recovery Zone Economic Development Bonds and/or Recovery Zone Facility Bonds, depending on which are legally available and most advantageous to the city at the time they are issued.

In 2008 the Ann Arbor Downtown Development Authority passed a resolution authorizing that the bond payments be made from revenues generated by the city’s public parking system, which is managed by the DDA. The city council approved an extension to the purchase option agreement for the land at its Aug. 5, 2010 meeting.

Stephen Kunselman (Ward 3) led off deliberations by expressing his concern about what happens to the bond if the deck does not get built. The city’s CFO, Tom Crawford, explained that the payment is not owed until there is a certificate of occupancy issued for the City Apartments project, and thus the bonds would not be issued until the project was substantively complete. Crawford allowed for some flexibility in that respect, if the city saw that it could get a better interest rate by issuing the bonds a few months before the project is actually complete.

Based on the timeline approved by the council in connection with the extension of the purchase option, Crawford said, the project is supposed to be built by around May 2012.

Outcome: The council voted unanimously to authorize the issuance of $9 million in bonds.

Glen Ann Place

Before the council was a request to extend for five years the 2007 consent judgment it reached with Joseph Freed and Associates LLC, developer of the Glen Ann Place project. Glen Ann Place was a planned unit development (PUD) approved by the council in July 2005, but that did not win subsequent approval from the city’s historic district commission.

Rendering of Glen Ann Place. The view is from the northeast. The pedestrian bridges cross Glen Avenue. From this angle, Ann Street is on the far side of the building.

Freed then filed suit against the city, the outcome of which was a consent judgment. Per the consent judgment, the height of the building was reduced from 10 to 9 stories.

Glen Ann Place is planned to include retail and office uses on its first two floors, with residential on upper stories. The site plan approvals in the consent judgment are set to expire on Nov. 30, 2010.

Although Freed was requesting a five-year extension, the resolution the council considered was for a two-year extension. The lawsuit will remain settled regardless of what council action is taken. From the staff cover memo:

The consent judgment granted these approvals … with an expiration of November 30, 2010. The petitioner has requested a five year extension due to current economic conditions. Because the approval of this project was a consent judgment, it is within the City Council and HDC’s discretion to grant this approval if they would like to provide an opportunity for this development to be completed. Whether or not this extension is granted, the lawsuit between the two parties will remain settled. Staff supports an extension of two years, consistent with the City’s policy of extending site plans for two year periods.

The resolution considered by the council also explicitly conditioned any extension on approval by the city’s historic district commission.

The council’s deliberations were led off  by Tony Derezinski (Ward 2), who had announced during his communications at the previous meeting that the issue would be coming before the council. Derezinski cited the absence of Sandi Smith (Ward 1) and Stephen Rapundalo (Ward 2) in suggesting a postponement – there would still be time to act before the site plan approvals expired.

The council’s delay, Derezinksi noted, meant that the historic district commission would weigh in first on the extension, at their meeting later in the week.

Outcome: The council voted unanimously to postpone consideration of an extension for Glen Ann Place.

Area, Height, Placement (AHP)

The proposed revisions to area, height and placement provisions in the city’s zoning code for most zoning designations outside of the downtown area – a notable exception being the R4C area, which is being studied separately – has a history dating at least to September 2008. At that time, the city council asked the planning commission to seek additional public input before moving ahead with recommended changes.

The general spirit of the changes is intended to achieve a variety of goals consistent with best practice in land use, among them, as specified in the city’s planning staff report:

a) more compact use of land and infrastructure;

b) the preservation of natural systems,

c) accommodating new growth along transit corridors in existing urban areas which have existing infrastructure,

d) locating buildings closer to the right-of-way to promote non-motorized access, and

e) mixed land uses.

The anticipated benefits of the changes include, from the city planning staff report:

1. Business and Job Retention and Expansion – The proposed amendments will allow the expansion of existing employment and retail uses that will encourage businesses to remain and expand in Ann Arbor.
2. Revitalization of older Retail and Employment Centers – Many retail and employment centers in Ann Arbor were built more than 30 years ago and have become dated and underutilized. These proposed amendments will encourage these sites to redevelop and be revitalized.
3. Environmental Benefits – Redeveloping sites will trigger a number of code requirements that will result in substantial environmental gains such as: a) storm water management (buildings constructed prior to 1978 typically do not detain storm water), b) landscaping, which will result in additional open space being provided as well as new trees and shrubs, and c) new energy efficiency standards for new buildings.
4. Improved Non-motorized Access – The revisions will result in new buildings being constructed closer to public streets and sidewalks which will improve access for transit riders, cyclists, and pedestrians, including those with limited access abilities.
5. Improved Efficiency of Land Use, Mass Transit and Infrastructure – The proposed revisions will allow existing non-residential zoning districts to be used more efficiently and compactly. This will better support transit service, encourage development in existing urban areas instead of greenfields (and other sites without access to transit), and use existing infrastructure more efficiently.
6. Enhanced Housing Diversity – By creating a new small lot single-family district (R1E) and encouraging parking to be located under new residential buildings, these proposed amendments will help expand the continuum of housing choices in Ann Arbor.

AHP: Public Hearing

Jim Mogensen recalled following the issue from the time it emerged from the planning commission’s ordinance review committee. The original proposal, he said, had included no height limits and the city council had caught that fact and sent it back for further public process.

Mogensen encouraged the council to reflect on situations – like the shopping center across from Arborland – that are planning a makeover, but not redevelopment with new construction. Would the new AHP provisions apply? he wondered. He observed that the basic challenge for that shopping center is that it’s “on the wrong side of the street.” In general, he cautioned, there could be cases where an owner had enough capital for a makeover, but not enough to redevelop. The council should think that through, he said.

AHP: Council Deliberations

The council deferred to a request from Marcia Higgins (Ward 4) to postpone action for two weeks. She indicated that she had questions about the changes that she had not been able to submit to city staff.

Outcome: The council voted unanimously to postpone the vote on AHP zoning changes.

Liquor

The council considered recommendations to the state to grant liquor licenses of two types: a micro brewer liquor license for Wolverine State Brewing Company at 2019 W. Stadium Blvd.; and a downtown development district liquor license to Mehak Indian Cuisine at 212 E. Washington.

Before the council were also two ownership transfers of liquor licenses – to Rush Street, at 314 S. Main St., and to Sava’s Cafe at 214 S. State St.

The limited deliberations came from two members of the liquor license review committee, Mike Anglin (Ward 5) and Tony Derezinski (Ward 2), who noted that the downtown development district license recommended for Mehak was a good sign – investors see downtown Ann Arbor as an opportunity. Derezinski said it would add to the variety of food and social life downtown.

Outcome: The council supported the requests and applications for all four liquor-related agenda items.

Alarms

Before the council was a wholesale repeal and replacement of the ordinance that regulates how false alarms to police and fire are handled when those false alarms are caused by automatic alarm systems. The city itself is moving to an automated system for enforcement and billing of false alarm fees – EnablePoint, which is supposed to reduce city staff time required to track and prepare false alarm billings. The false alarm tracking software will integrate with the recently implemented New World Financial System.

Separately, the council considered a new fee structure for false alarms. Under the new ordinance and fee schedule, registration would be required for fire alarm systems, and the “free” first-time offense is to be eliminated. False alarms from non-registered locations are assessed the registration fee plus the standard fine.

False Alarms Response Fee Schedule (Police and Fire Alarms)

                                   Current     Proposed

POLICE
Annual Alarm System Registration    $37         $ 37
False Alarm Response                $82         $ 82
1st False Alarm Response for
Non-Registered Location             $82         $119

FIRE
Annual Alarm System Registration    none        $ 37
1st False Alarm Response            none        $250
2nd False Alarm Response            $120        $250
3rd and Subsequent Response         $360        $250
1st False Alarm Response for
Non-Registered Location             none        $287

as-

Alarms: Public Hearing

Jim Mogensen suggested that the council be aware that after-hours cleaning services can sometimes trip alarms and that they need to make sure this phenomenon is taken into account.

Alarms: Council Deliberations

Sabra Briere (Ward 1) expressed some concern on behalf of a resident who had contacted her about the ordinance change. He was worried that a false alarm triggered while he was out of town had previously cost him around $90, but the new arrangement seemed like it could cost him as much as $500.

City fire safety staff explained that there is an appeals process similar to the one used for traffic tickets. By way of background, the $500 figure is not related to the false alarm fee schedule, but rather to violations of the ordinance itself. For example, the new ordinance specifies that alarm companies cannot represent that their equipment has been tested or approved by the city of Ann Arbor:

3. No Person engaged in the business of installing, leasing, maintaining, repairing, replacing or servicing Alarm Systems shall: a. represent to anyone that any of the equipment they sell or service has been tested or in any way approved by the City of Ann Arbor. b. install an Alarm System unless a valid permit is in effect. c. obtain all permits, licenses and inspections required and comply with all applicable statutes, ordinances and regulations.

If an alarm company were to claim the city of Ann Arbor had approved their system, then that company would be guilty of an infraction that could be cited and fined for $500. The schedule of false alarm response fees will no longer be graduated. But for frequent false alarms from one location, the new ordinance provides a mechanism for the city to enforce disconnection of that alarm service.

Outcome: The council voted unanimously to approve the false alarm ordinance and fee schedule change.

UM Soccer Facility

On the council’s agenda was an item that dealt with annexation of property to the city of Ann Arbor from Pittsfield Township and the zoning of the parcel as public land (PL). The property, owned by the University of Michigan, is located on the east side of South Main Street, south of Ann Arbor Saline Road. The university uses the land for a soccer facility and recently completed the construction of a new soccer stadium. The point of the annexation is to allow the university to hook up water and sewer facilities for restrooms in the new stadium. Fees associated with the hookup include: $37,389 water improvement charge, $97,740 sewer improvement charge, and $14,000 local public improvement charge for storm sewer.

The city’s planning staff and planning commission recommended approval of the rezoning in December 2009, and in the interim, the university has completed construction of the facility.

Soccer: Public Hearing

During the public hearing on the rezoning of the land where the soccer stadium is located, only one person spoke – Jim Mogensen. He characterized it as a “missed opportunity” because the facility is already built. He noted that the planning commission had denied a special use exemption by Arbor Dog Daycare due to noise complaints, and suggested that the same principle could be applicable to the UM soccer stadium. [Chronicle coverage: "Expansion of Arbor Dog Daycare Denied"] The fact that UM was not applying for a special use exemption and was just now bringing the rezoning to the council after the facility was built was characterized by Mogensen as “institutional narcissism.”

Mogensen noted that there are more and more clear commercial enterprises on the university campus. As the university grows, he said, it puts more strain on infrastructure to support it, without a corresponding contribution in property taxes. He encouraged the council to think through what happens when commercial activities take place on public property. He encouraged the council to postpone the rezoning – the facility had already been built. It was worth taking the time to think through the issues, he said.

Soccer: Council Deliberations

Sabra Briere (Ward 1) indicated her dismay that the facility had already been built before the council rezoned the property. She said that in the future, she hoped the university would “jump through the hoops in the right direction.”

Outcome: The council unanimously approved the rezoning of the university’s land to PL (public land), with the newly constructed soccer stadium, which has been annexed into the city.

Peace Corps

Before the council was a street closing – State Street, from South University to East William – in connection with the 50th anniversary celebration of the founding of the Peace Corps. There will be two events on Oct. 14, 2010, one of them in the wee hours of the morning, to mark the exact anniversary of the 2 a.m. speech by John F. Kennedy from the steps of the Michigan Union. The later event, at 11 a.m. will include as guest speakers  Sen. Harris Wofford, Jack Hood Vaughn, Aaron Williams, Julia Darlow, Mary Sue Coleman and Jennifer Granholm.

The University Record provides additional background: “The Peace Corps: It all started here.”

Outcome: The council voted unanimously to approve the street closing.

Nominations

The council received several nominations for appointments to boards and commissions that will be voted on by the council at their Oct. 18 meeting. Two of note were Malverne Winborne, to fill a vacancy on the Ann Arbor public art commission (AAPAC), and Tim Hull to fill a spot on the taxicab board.

For background on AAPAC’s own efforts to identify a new member, see “Ann Arbor art commission also seeks two new members.”

Hull has addressed the council during public commentary in recent months on the topic of holding the Ann Arbor Transportation Authority more accountable, and he did that on Monday night as well. He also thanked the mayor for the nomination to the taxicab board.

Tax “Loophole”

Margie Teall (Ward 4), during her communications time, asked the city’s CFO, Tom Crawford, about an issue that had been raised at a recent candidate forum by independent candidate Newcombe Clark, who along with Republican John Floyd is contesting the Ward 5 city council seat currently held by Democrat Carsten Hohnke.

Tax Issue: Background

The kind of “tax loophole” in question relates to real estate transactions involving companies that own companies, which in turn own real property – where the transaction itself is not directly about the real property, but which has the end effect of transferring the ownership of that property.

In a court case from 2006, Signature Villas v. City of Ann Arbor, the Michigan Court of Appeals ruled that in a transaction involving ownership of a company that, in turn, owns real property, the transaction meets the state statutes definition of a “transfer of ownership.”

From the court’s opinion [emphasis original]:

Petitioner asserts that § 27a(6)(h) only applies to the conveyance of ownership interests in legal entities that own property, and does not apply to the conveyance of the ownership of a company that owns a company that owns property. We disagree.

Whether a transfer of ownership has taken place is important, because when a transfer takes place, the effect of Proposal A [passed in 1994] – which limits the rate at which taxes on a property can increase – is undone. From previous Chronicle coverage on tax issues:

When a property is purchased, the taxable value is reset to be equal to assessed value. And the assessed value is an amount set at roughly 50% of market value. But in years subsequent to that purchase, the assessed value of the property will increase or decrease, depending on overall market conditions.

If the market goes up after the purchase, then the assessed value goes up, and intuitively, taxes paid on the property (that is, the taxable value) should increase, and they do. But Proposal A puts a cap on how fast the taxable value can increase. That cap is 5% or the rate of inflation, whichever is lower.

Suppose you buy a home for $200,000. If you’re paying the “right” price, based on the assessor’s assumptions, then the assessed value and the taxable value would be $100,000. Further, suppose that the following year, the properties in your neighborhood appreciate by 10%, putting the assessed value at $110,000. And suppose that inflation for that period is right at 5%. The difference between the 10% appreciation and the 5% overall inflation means that for that year the taxable value can’t increase to match the assessed value . Due to Proposal A, the maximum taxable value for the property would be $105,000. On that scenario, the property would have an assessed value of $110,000 and a taxable value of only $105,000.

If a property’s assessed value is currently greater than its taxable value, then a transaction involving that property will reset the taxable value at an amount greater than its current taxable value – so there’s an advantage to the purchaser if that transaction could be analyzed as not an actual transfer of ownership. That’s the kind of analysis the Court of Appeals ruled against in 2006.

For the city of Ann Arbor, then, the question is: How realistic is this idea that there could be $4.5 million in additional property taxes that are currently not being paid, because there were transactions since 2006 that were not property analyzed and reported as transfers of ownership?

Tax Issue: City Staff Response

In response to Teall, Crawford allowed that on occasion, that kind of transaction could take place, but that the city was not aware of any specific instances – the city would address any such cases, he said. He invited the city attorney to weigh in on the issue. City attorney Stephen Postema characterized the recent community conversation on the topic as treating the subject as if it were surprising or new. In fact, he said, it was the city of Ann Arbor that had established the legal precedent that governs such transactions, so of course the city is aware of the issue.

Teall asked if the city was on the lookout for subsequent transactions – Postema and Crawford confirmed that they were. Crawford noted that the issue applies statewide and that the city had a number of “clever ways” of monitoring all commercial real estate transactions – he expressed reluctance at revealing publicly what those ways are. However, he assured Teall that the city does ongoing due diligence on such transactions. Crawford noted that in cases where property owners are identified as being in violation, they must make historical repayment with interest and penalties.

Mike Anglin (Ward 5) inquired whether the city might be able to encourage compliance by looking at the possibility of a “tax amnesty.” Crawford replied that this was not an option for a local municipality – the city could not waive the penalties or interest, either.

Stephen Kunselman (Ward 3) wanted to know if the Glen Ann Place property – considered but postponed that evening – had changed ownership and could possibly fit the category of properties that needed to have a transfer of ownership recorded. Crawford told Kunselman he would need to check.

Summer Festival Gift

Making a presentation to the city on behalf of the Ann Arbor Summer Festival were AASF board members Jim Kosteva and Jayne Miller, and festival director Robb Woulfe.

(From left to right): Robb Woulfe, director of the Ann Arbor Summer Festival; mayor John Hieftje; Jayne Miller and Jim Kosteva, members of the Summer Festival board.

Kosteva is the University of Michigan director of community relations, while Miller was, until earlier this year, community services area administrator for the city.

Their presentation to the city was a large print of a photograph taken by Myra Klarman, who is the festival’s photographer. Woulfe thanked the council for their past support, noting that typically the Summer Festival appeared before the council to ask for money or to relax wage requirements, but on this occasion they wanted to make a gift to the city.

He said he hoped the city would find a place to hang Klarman’s print. [For some background on Summer Festival funding and wages: "Living Wage: Insourcing City Temps"]

Communications and Comment

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

Comm/Comm: East Stadium Bridges Traffic Control

Sue McCormick, the city’s public services area administrator, briefed the council on the traffic control plan for the start of construction on the East Stadium bridge replacement, now scheduled to start in the summer of 2011. There will be an east-west detour for Stadium Boulevard traffic, she explained, that will route traffic via South Main, Eisenhower, and South Industrial. The north-south detour for State Street – which leads under the bridge – will take traffic via Packard and Stimpson. McCormick pointed out that this is effectively the same traffic control plan that the city had used in November 2009, when five beams of the bridge were removed. That plan had included input from the Ann Arbor Transportation Authority and the Ann Arbor Public Schools, she said.

McCormick advised the council that the city would approach the community again 4-5 months before the start of construction for additional input and education about the planned detours. She also noted that in November there would be a “traffic summit” with the Washtenaw County Road Commission and the Michigan Dept. of Transportation, which would be an opportunity to look at the range of other road construction projects planned for the same period. That would allow the city to coordinate and modify the East Stadium traffic control plan, she said. She noted that the plan could be different, depending on whether construction starts before or after schools end their spring session.

McCormick advised the council that based on the experience in November, there could be up to a 40% reduction in traffic volume along the corridor, which would mean that the detour routes would carry 60% of the traffic that would ordinarily travel unimpeded along Stadium and State streets. That’s because driver awareness of the situation would lead people to find other ways without using the detour.

Margie Teall (Ward 4) asked that the city take a look at pedestrian traffic and how people might get from Burns Park to Pioneer on foot during the construction period.

Comm/Comm: Commuter Rail Excursion Service

Mayor John Hieftje reported that he’d attended another meeting attended also by the mayor of Dearborn about the Ann Arbor to Detroit commuter rail project. Hieftje expressed his optimism about the project eventually becoming a reality, based on the amount of money the federal government is investing in rail transportation through the ARRA stimulus program. At SEMCOG’s Oct. 28 meeting – to be held at 4:30 p.m. at the Henry Ford, Hieftje announced, the refurbished railcars to be used for the service will be on display. They’re double-decker stainless steel cars.

An excursion service would be offered to Detroit’s Thanksgiving Day parade, as well as to the Big Chill, a hockey game at Michigan Stadium between the University of Michigan and Michigan State University, scheduled for Dec. 11. Hieftje also mentioned the possibility of excursion trains scheduled for the Ann Arbor art fairs. He cautioned, though, that there would not suddenly be commuter rail service – it would be built layer by layer.

Comm/Comm: Fuller Road Station

Two people addressed the city council during public commentary reserved time on the subject of Fuller Road Station, a proposed parking deck to be built in partnership with the University of Michigan on land designated as city parkland.

Nancy Shiffler noted that the city’s planning commission had recommended approval of the project’s site plan at its Sept. 21, 2010 meeting. She felt the commission had not considered the precedent it would set for use of park land without the consent of voters. She alluded to the history of the parcel in question, which she contended was purchased with taxpayer money and federal help and was designated as a wildlife habitat. She also characterized the project as bad transportation planning, saying that a parking deck is counter to a goal of mass transit. She also contended that the planning commission had not appropriately applied private development standards, and called the citizen input activities in connection with the project “bait and switch.”

Gwen Nystuen, who serves on the city’s park advisory commission, noted that the city council would likely be voting on the site plan at its next meeting. She said there are questions about used of dedicated park land for a transportation use. She urged the council to take additional time to consider the proposal, saying that Ann Arbor currently has more time than money, so it makes sense to spend some time. [Coverage of park advisory commission discussions on Fuller Road Station: "PAC Softens Stance on Fuller Road Station"]

Comm/Comm: City-DDA Parking Agreement

Fuller Road Station is a topic that has arisen as a tangential topic in the context of ongoing negotiations between the Ann Arbor Downtown Development Authority and the city of Ann Arbor on the parking agreement that governs how the DDA manages the city’s parking system. The question has arisen as to whether the Fuller Road deck would fall under any new re-negotiated agreement.

At Monday’s council meeting, Christopher Taylor (Ward 3) who serves on the council’s committee that is engaged in the negotiations, gave an update on their status. He said the conversations have moved away from the idea of the DDA taking responsibility for enforcement of parking regulations to focus on reworking the language of the existing agreement and the idea that the DDA would become the implementation engine for development of city-owned surface parking lots in the downtown. He alerted his colleagues to the likelihood of a city council work session when the DDA would present their concept for implementation of DDA-led development.

Comm/Comm: Housing Commission

Tony Derezinski (Ward 2), who is the city council’s liaison to the Ann Arbor Housing Commission, reported on a useful field trip the commission had made to Grand Rapids to look at the diversity of options that Grand Rapids had achieved.

Comm/Comm: Single-Stream Recycling

Two organizations, independently of each other, in their remarks before the council expressed appreciation to the city for implementation of the single-stream recycling system.

For the Inter-Cooperative Council, general manager Eric Lipson and president Jeremiah Devlin-Ruelle were on hand to receive a mayoral proclamation declaring October Co-op Month in Ann Arbor. Devlin-Ruelle cited the single-stream system as providing a way for the cooperative housing organization to do a lot more recycling. He also praised the council for passing the recent ban on porch couches, saying it would make Ann Arbor safer.

During public commentary, Ken Wilson, pastor of Vineyard Church, read forth a resolution, signed by 539 people from his congregation, that expressed appreciation for the council’s service to the community, and highlighted the city’s implementation of single-stream recycling as a specific example.

Comm/Comm: NAP Volunteer

Denise Held was honored for her work as a volunteer in the city’s adopt-a-park program. The city council recognizes the efforts of a park volunteer once a month, typically at the first of its two monthly meetings. Held expressed her thanks to Sue McCormick, the city’s public services area administrator, for creating Brookside Park in the first place.

Comm/Comm: Community Policing

Jim Mogensen addressed the council on the topic of community policing and the homeless population. The overall context for his remarks is a recently re-constituted task force to look at panhandling in the downtown area. The council approved on Monday night the appointment of two additional members to that task force – Peter Ludt to represent the State Street merchants, and Mary Campbell to represent the Kerrytown merchants.

Mogensen related two anecdotes based on his experience 20 years ago in Silver Springs, Maryland. One involved a building where people had been living as squatters. The building’s owner boarded up the building to prevent people from occupying it. When asked how the people had reacted to having access to their temporary quarters blocked, his response was “What people?” Several people were then discovered inside, still alive but hungry and dehydrated.

The second anecdote involved a woman who called police about people hanging out on the street corner in view of her apartment window – doing drugs, having sex and the like. On investigation, the police determined that the people in question were simply waiting for the bus. When the calls persisted from the woman, the solution that was found was to move the bus stop a few yards down the road, so that bus riders waiting for the bus were no longer in the woman’s view.

Mogensen offered those two anecdotes as illustrations that the solutions to problems don’t always recognize what the actual problem is. As the city considers how to deal with panhandlers, he cautioned, he asked councilmembers to reflect on the fact that we recognize the interest that food cart vendors have in having access to the pedestrian flow. In the same way, panhandlers have an interest and a stake in having access to the pedestrian flow – something we should be mindful of, he said.

Comm/Comm: Integrated Funding

Lily Au addressed the council on the topic of the coordination of nonprofit funding with the city, the county and the Urban County, which is now proposed to include United Way and the Ann Arbor Area Community Foundation. [For Chronicle coverage of a recent meeting of the Urban County executive committee, which discussed the topic: "Coordinated Funding for Nonprofits Planned"] Votes by the Urban County, the county’s board of commissioners and the Ann Arbor city council will be coming up in late October and early November.

Lily Au makes her point with toy boats.

Using toy boats as props, Au warned that the consolidation meant that a big boat was being built. But the problem with a big boat is that it can’t reach a small stream.

She questioned whether the consolidation would actually save money, pointing to the administrative overhead cost that would be incurred – in addition to the administrative overhead of the United Way and the Ann Arbor Area Community Foundation. Au also asked who would be responsible for overseeing how the money is spent in the consolidated approach, once the money is allocated.

Comm/Comm: Zoning Reform

Thomas Partridge introduced himself as a Washtenaw County Democrat with Christian values. He called on the city council to unite the city, the county, and the state and give inspiration to the entire nation by establishing zoning regulations in support of affordable housing. He called for the election of Democrat Virg Bernero as Michigan’s next governor.

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

Absent: Stephen Rapundalo [arrived towards the end of the meeting], Sandi Smith.

Next council meeting: Oct. 18, 2010 at 7 p.m. in council chambers, 2nd floor of the Guy C. Larcom, Jr. Municipal Building, 100 N. Fifth Ave. [confirm date]