At its Oct. 16, 2013 meeting, the board had passed a resolution directing county administrator Verna McDaniel to develop a policy for evaluating future TIF proposals. The resolution stated that the policy would be developed with input from staff of the office of community and economic development, the equalization department, and the brownfield redevelopment authority. The Oct. 16 resolution was passed over dissent by the board’s two Republican commissioners, Dan Smith (R-District 2) and Alicia Ping (R-District 3).

Subsequently, an advisory committee was formed to help develop the policy. Members were: county commissioner Andy LaBarre (D-District 7); county treasurer Catherine McClary; corporation counsel Curtis Hedger; and finance director Kelly Belknap.

The two-page policy brought forward by McDaniel lays out a process by which the board would consider any proposed or amended Corridor Improvement Authority (CIA) or Downtown Development Authority (DDA) where the capture of county tax revenues is requested. [.pdf of TIF policy]

A final vote is expected at the board’s next meeting, on Sept. 3.

This brief was filed from the boardroom at the county administration building, 220 N. Main St. in Ann Arbor. A more detailed report will follow.

A supporter of Michigan’s Stand Your Ground law brought his gun to the Oct. 16 meeting of the Washtenaw County board of commissioners. (Photos by the writer.)

About three dozen people spoke to the board about the Stand Your Ground resolution, which urged the state legislature to repeal that law. Although there were speakers on both sides of the issue, more than 20 voiced opposition to the resolution, including several who attended the meeting wearing sidearms.

It was after midnight when the board took a 5-to-4 vote to pass the resolution, over dissent from Kent Martinez-Kratz (D-District 1), Dan Smith (R-District 2), Alicia Ping (R-District 3), and Rolland Sizemore Jr. (D-District 5). In support of the resolution were Felicia Brabec (D-District 4), Ronnie Peterson (D-District 6), Andy LaBarre (D-District 7), Yousef Rabhi (D-District 8) and Conan Smith (D-District 9).

The following week, David Raaflaub of Ypsilanti – a former candidate for county commissioner – filed a complaint against the board in the 22nd Circuit Court. The complaint asks the court to determine two issues: (1) what authority the board has that enables it to “draw conclusions of law,” and (2) what authority the board has to represent the county in seeking changes to state law. Dan Smith has indicated that he would bring forward a resolution to rescind the board’s Oct. 16 action, if it’s determined that the county will incur additional costs – such as fees for outside legal counsel – to defend the lawsuit.

Another major debate on Oct. 16 related to an increase in the Act 88 tax levy, which funds economic development and agriculture – including activities of Ann Arbor SPARK. The board ultimately gave initial approval to increase the tax from 0.06 mills to 0.07 mills, following a long discussion and a failed attempt by Conan Smith to increase the tax even more, to 0.09 mills. His proposal for a draft policy to guide the allocation of Act 88 funds did win support from the majority of commissioners, however.

The county’s position is that it’s authorized to collect the Act 88 millage – as well as a levy for veterans relief services – without seeking voter approval. That’s because the state legislation that enables the county to levy these taxes predates Michigan’s Headlee Amendment. During deliberations, Dan Smith raised questions about whether levying this kind of tax is constitutional. He also questions whether the language of the Act 88 statute allows the kind of general interpretation the county is using to define eligible uses of funds generated by the levy.

Dan Smith also proposed amendments for both the Act 88 and veterans relief millages in the future exempt them from capture by tax increment financing (TIF) districts or authorities in the county. Those exemptions, which were approved by the board, would apply to tax capture from a proposed State Street corridor improvement authority (CIA) in Pittsfield Township. After about 90 minutes of debate, the board gave initial approval to participate in that project, with Dan Smith casting the only dissenting vote. He had unsuccessfully proposed postponement, then floated an opt-out resolution that did not secure enough votes to pass. The board is expected to take a final vote on participating in the CIA at its Nov. 6 meeting.

In other action, the board (1) gave initial approval to a proposed brownfield redevelopment plan by the Chelsea Milling Co., makers of Jiffy Mix; (2) appointed Barb Fuller to the county road commission; (3) took an initial vote to extend the coordinated funding approach, which supports local nonprofits; and (4) authorized the annual apportionment report, with details of the 2013 taxable valuations for property in the county.

And in a vote taken after midnight, the board rejected a proposal that would have given notice to eliminate a lump-sum budgeting approach for Washtenaw County’s court system. That vote was 3-6, with support from only Dan Smith (R-District 2), Conan Smith (D-District 9) and Kent Martinez-Kratz (D-District 1).

Stand Your Ground

The Oct. 16 agenda included a resolution asking state legislators to repeal Michigan’s version of the Stand Your Ground law. [.pdf of resolution]

This is the fourth meeting that has included public commentary on the Stand Your Ground law – Public Act 309, the Michigan Self Defense Act, which was passed in 2006. In early September, board chair Yousef Rabhi (D-District 8) had announced his intent to bring forward a resolution urging the state legislature to repeal the law, similar to resolutions passed by the Ann Arbor city council on Aug. 8, 2013 and by the Ypsilanti city council on Aug. 20, 2013. The resolution had originally appeared on the county board’s Sept. 18 agenda, but was pulled from the agenda before the meeting when it became uncertain that it would win sufficient support to pass, given the anticipated absence of some commissioners.

Supporters of the law spoke at the Sept. 18 and Oct. 2 board meetings, and showed up again on Oct. 16. Some were affiliated with Michigan Open Carry Inc., an advocacy group based in Lansing that has been urging people to attend the Washtenaw County board meetings to protest the proposed resolution. The resolution also attracted the attention of the National Rifle Association. The NRA’s Institute for Legislative Action issued an alert on Oct. 11 calling the resolution “misguided” and providing contact information for the nine county commissioners.

Stand Your Ground: Public Commentary

Thirty-two people spoke about this issue during public commentary at the start of the meeting – 20 people supporting Stand Your Ground, and 12 people opposing the state law. Many others attended the meeting, filling the boardroom to capacity with overflow into the adjacent lobby. The county had brought in two sheriff’s deputy for extra security.

From left: Lefiest Galimore and Doug Smith at the Oct. 16 county board meeting. Galimore opposes Michigan’s Stand Your Ground law, which Smith supports.

Unlike speakers at the Oct. 2 meeting who were primarily from outside of Washtenaw County, most of the 20 people who supported Stand Your Ground on Oct. 16 – and who opposed the resolution urging its repeal – said they lived in Washtenaw County, including residents of Ann Arbor, Saline, Ypsilanti and several of the townships.

Many argued that law-abiding citizens should have the right to defend themselves, and that Stand Your Ground prevented victims from being prosecuted as killers. Some stated that repealing Stand Your Ground would embolden predators and threaten the safety of residents. Others argued that this was a state issue that the county board was not in a position to address.

A couple of speakers – including Dennis Moore of the Willow Run Tea Party Caucus – pointed out that this resolution is energizing supporters of Stand Your Ground and creating common ground for people of different political parties.

Most of the 12 opponents of Stand Your Ground were from Ann Arbor, including Lefiest Galimore, who has advocated for this kind of resolution at previous Ann Arbor city council and county board meetings. He said he didn’t oppose gun ownership, but he supported the repeal of Act 309. It’s not an anti-gun movement, but it’s about protecting every citizen in the community, he said. Others who spoke in support of the resolution included two pastors, at least two members of the Interfaith Council for Peace & Justice, and two physicians – Jerry Walden and Andrew Zweifler, representing Physicians for the Prevention of Gun Violence. The majority of those speakers stated they supported non-violence, criticized the increasing prevalence of guns and America’s high murder rate compared to other countries, and argued that the law is applied in discriminatory ways against minorities.

During a second opportunity for public commentary – which occurred around midnight – six people spoke in support of the Stand Your Ground law, including some who had addressed the board earlier in the meeting.

Stand Your Ground: Initial Board Discussion

After about 90 minutes of the initial public commentary at the start of the meeting, several commissioners responded. Andy LaBarre (D-District 7) thanked everyone for coming. It was heartening to see such engagement and active democracy, he said, adding that he’d like it to extend to other issues as well.

Dan Smith (R-District 2) said he appreciated that people had shown up and he noted that there would be another opportunity for public commentary later in the evening. He said there seemed to be some misunderstanding about what the resolution will do. “It does absolutely nothing,” D. Smith said.

Conan Smith (D-District 9) also thanked people for coming out and sharing their thoughts. It’s gratifying that people have spent time to understand the issue deeply. Regarding whether this resolution is within the purview of the county board, C. Smith stated that the county funds the sheriff’s department, as well as the criminal justice system – including the prosecuting attorney’s office. “So state laws that impact the operations of those functions within the county are of concern to this board,” he said. The board might not have control over the legislation, but informing state legislators “about what motivates the folks here in Washtenaw County” is important, C. Smith said, and the way that the board does that is through resolutions. The resolutions don’t have the force of law, he added, but they do communicate the board’s interests.

Alicia Ping (R-District 3) agreed with Dan Smith that the resolution does nothing, and she reminded other commissioners that “we are not a lobbying organization. We are a legislative body.” This isn’t an issue in Lansing now, she said. Residents are welcome to lobby state legislators directly, she added. “We are not an intermediary.” Her statement resulted in applause from residents in the boardroom.

Stand Your Ground: Final Board Action

The agenda item for the Stand Your Ground resolution was taken up at about 12:30 a.m. Felicia Brabec (D-District 4) said she’d spent time reading and reflecting on the law, but her main concern is that the application of the law doesn’t meet its intent.

Felicia Brabec (D-District 4), chair of the board’s ways & means committee.

Dan Smith (R-District 2) pointed out that there are six state legislators representing the residents of Washtenaw County – including one who had attended the meeting earlier in the evening. [He was referring to state Sen. Rebekah Warren (D-District 18), who is married to county commissioner Conan Smith.] “We even have the First Constituent in Lansing, so we have a bonus in this county,” he joked. [The reference was to Gov. Rick Snyder, a Republican who lives in the Ann Arbor area.] This is not county business, D. Smith said. The process is to take concerns to Lansing, and not bring them to the county board.

D. Smith noted that the county board has a lot of local business to conduct, and he observed that the board postponed discussion of the proposed budget that evening. “We need to stick to Washtenaw County business, and let Lansing do Lansing’s business.”

Ronnie Peterson (D-District 6) thanked residents for attending and for their patience, saying it was the longest meeting he could recall in all his years on the board. [It adjourned at about 12:45 a.m.] “It shows that government is working,” he said. The Stand Your Ground resolution is not an easy vote for him, Peterson said, and he’s talked with a lot of constituents about it. He thought the discussion had been healthy.

Everyone knows what brought this issue to the forefront, Petersen said, adding that he didn’t want to politicize it. [The reference was to the Trayvon Martin killing in Florida.] Peterson said that he hadn’t been contacted by any national organization, as some people had implied.

Peterson stated that he believes in the right to own guns, and most gun owners are decent, law-abiding citizens. He said he knows what it means to be a victim of crime. But America needs a more peaceful environment. The country is far too violent, he said, and that topic deserves more discussion.

Outcome: The resolution passed on a 5-4 vote. The five commissioners who voted in favor of the resolution were Felicia Brabec (D-District 4), Ronnie Peterson (D-District 6), Andy LaBarre (D-District 7), Yousef Rabhi (D-District 8) and Conan Smith (D-District 9). Voting against it were Kent Martinez-Kratz (D-District 1), Dan Smith (R-District 2), Alicia Ping (R-District 3), and Rolland Sizemore Jr. (D-District 5).

Stand Your Ground: Legal Action

The following week, David Raaflaub filed a lawsuit against the Washtenaw County board of commissioners over its Stand Your Ground resolution. [.pdf of board resolution] [.pdf of Raaflaub complaint]

Ian Reed Twiss, an Ann Arbor resident, talks with commissioner Alicia Ping (R-District 3). Twiss is pastor at Holy Faith Church in Saline, which is located in Ping’s district. He spoke during public commentary on Oct. 16 to support the board’s resolution about repealing Michigan’s Stand Your Ground law. Ping voted against that resolution.

The complaint, filed on Oct. 21 in the 22nd Circuit Court of Washtenaw County, asks the court to determine two issues: (1) what authority the board has that enables it to “draw conclusions of law,” and (2) what authority the board has to represent the county in seeking changes to state law.

Curtis Hedger, the county’s corporation counsel, stated in an Oct. 24 email to The Chronicle that the county is in the process of retaining counsel who will respond to the lawsuit on the board’s behalf.

Reached via email on Oct. 24, Dan Smith indicated that he would bring forward a resolution to rescind the board’s previous action, if it’s determined that the county will incur additional costs – such as fees for outside legal counsel – to defend the lawsuit.

Raaflaub is a member of the Washtenaw County Republican executive committee. He was the Republican candidate for county commissioner in District 6 in the November 2012 election, running against incumbent Democrat Ronnie Peterson, who won that election.

Raaflaub’s filing indicates that the filing is “pro se” – that is, he’s representing himself. He is currently suspended by the state bar from the practice of law.

Veterans Relief, Act 88 Tax Hikes

Increases to two taxes for the upcoming 2014 budget – one for veterans relief services, and another for agricultural and economic development – were on the Oct. 16 agenda.

Commissioners were asked to give final approval to levy a 0.0333 mill tax for indigent veterans services, following an initial vote on Oct. 2. The new rate of 1/30th of a mill would be levied in December 2013 to fund services in 2014. It’s expected to generate $463,160 in revenues. The current rate, approved by the board last year and levied in December 2012, is 0.0286 mills – or 1/35th of a mill. It generated $390,340 this year.

According to a staff memo, the additional revenue is needed to address rising claims, the anticipated release of current active duty soldiers, the increased cost of living reflected in claims, continued increases to demand, and an increased workload due to the Washtenaw County Veterans Treatment Court.

The county’s position is that it is authorized to collect up to 1/10th of a mill without seeking voter approval. That’s because the state legislation that enables the county to levy this type of tax – the Veterans Relief Fund Act, Public Act 214 of 1899 – predates the state’s Headlee Amendment. The county first began levying this millage in 2008. Services are administered through the county’s department of veterans affairs. The county had held a public hearing on this tax proposal at its Sept. 18 meeting, but no one spoke.

A public hearing and initial vote were held on Oct. 16 for the economic development and agricultural tax, known as Act 88 of 1913. The proposed increase to the Act 88 millage is from 0.06 mills to 0.07 mills. The millage would be levied in December 2013 and would raise an estimated $972,635.

According to a staff memo, the funds would be allocated to the following groups:

• $423,135: Washtenaw County office of community & economic development
• $200,000: Ann Arbor SPARK
• $100,000: Eastern Leaders Group
• $52,000: Promotion of Heritage Tourism in Washtenaw County
• $50,000: SPARK East
• $50,000: Detroit Region Aerotropolis
• $82,500: Washtenaw County 4-H
• $15,000: Washtenaw County 4-H Youth Show

The enabling legislation for this tax is also pre-Headlee, and the county board levies the tax without voter approval.

Veterans Relief, Act 88: Public Commentary & Public Hearing

Two executives from Ann Arbor SPARK – Donna Doleman, vice president of marketing and communications, and Luke Bonner, vice president of business development – spoke in support of the Act 88 funding during public commentary at the start of the Oct. 16 meeting. Doleman thanked commissioners for partnering to create jobs for this region through investment in economic development.

Donna Doleman, Ann Arbor Spark vice president of marketing and communications.

Doleman highlighted SPARK’s work in business retention, expansion and attraction, saying it’s become a model for the country. She listed several accomplishments that the agency has achieved. Some of those items were included in handouts provided to the board. SPARK’s national and international prestige gives it an edge in marketing this region, Doleman said. Thirty percent of the views on a business attraction video have been international, she noted. [.pdf of SPARK handout 1] [.pdf of SPARK handout 2] [.pdf of SPARK handout 3]

Bonner echoed Doleman’s comments, saying that without the county’s support, SPARK wouldn’t be able to accomplish what it has. This year alone, he said, SPARK has helped secured $100 million in new investment and 1,200 jobs. He highlighted two examples: American Broach & Machine in Ypsilanti, and Universal Marketing Group, which is expanding its call center operation from Toledo. Bonner also described SPARK’s help in marketing the former GM property in Ypsilanti Township.

Leigh Greden introduced himself as vice president of government and community relations at Eastern Michigan University, and a resident of the district in Ann Arbor that’s represented by county commissioner Yousef Rabhi. He urged the board to approve the increase in the Act 88 millage. The low cost of just 73 cents per month for the average homeowner allows the county to support a variety of tangible projects, he said, including Ann Arbor SPARK’s initiatives, heritage tourism, and the Eastern Leaders Group. Greden noted that he serves as co-chair of the ELG along with Bob Tetens, director of the county’s parks and recreation commission. He described the ELG’s efforts, including the Live Ypsi program that encourages EMU staff and faculty to buy homes in the city, which results in more people paying taxes there. Act 88 funding also helped Michigan Ladder Co. in Ypsilanti, he said. “None of these programs would have been possible without the Act 88 millage,” Greden said. When something works, he concluded, “keep doing it.”

Doug Smith began by saying he wouldn’t give his address, contending that requiring someone to give their address violated Michigan’s Open Meetings Act. The two tax increases that the board will be voting on will push the county above the constitutional limit of 18 mills, he said. He asked the board to refrain from voting until the county has made public its legal justification for exceeding the limit. Until 2008, activities that are now funded through the veterans relief and Act 88 millages were paid for out of the county’s general fund. He read a section from the Headlee Amendment, which the state enacted in 1978:

Units of Local Government are hereby prohibited from levying any tax not authorized by law or charter when this section is ratified or from increasing the rate of an existing tax above that rate authorized by law or charter when this section is ratified, without the approval of a majority of the qualified electors of that unit of Local Government voting thereon.

It seems the county’s corporation counsel is saying that since the veterans relief and Act 88 laws allowed the levying of millages prior to 1978, that these can be levied in excess of the 18-mill cap without a vote by the county’s citizens, Smith said. He called the levies “legally dubious” and said he’s trying to do legal research to verify that. He hasn’t been able to find anything published by the county that gives a legal justification for these millages. Are any other counties using these levies above the 18-mill cap? Have the levies ever been tested in court, and is there published case law? Does it matter that the veterans relief law states “shall” and the Act 88 law states “may” levy a tax?

Doug Smith pointed out that the Headlee Amendment states that any taxpayer in Michigan shall have standing for a lawsuit in Michigan’s Court of Appeals to enforce it, so all it would take is one taxpayer willing to challenge this tax, and the county would find itself in court. He again asked that the board hold off on voting until the corporation counsel has published an opinion on the taxes for all citizens to see.

Smith also spoke during the Act 88 public hearing later in the meeting, which occurred around midnight. He pointed out that Act 88 allows for the spending of proceeds for specific purposes. From Act 88:

… for the purpose of advertising the agricultural advantages of the state or for displaying the products and industries of any county in the state at domestic or foreign expositions, for the purpose of encouraging immigration and increasing trade in the products of the state, and advertising the state and any portion thereof for tourists and resorters, and to permit the boards of supervisors out of any sum so raised, or out of the general fund, to contribute all or any portion of the same to any development board or bureau to be by said board or bureau expended for the purposes herein named.

Smith wondered whether anyone checks with Ann Arbor SPARK to ensure that those requirements are met. Referring to the example that SPARK vice president Luke Bonner had given about American Broach, Smith described it as a wholly-owned Chinese company that does all of its manufacturing in China. The local operation is for research and development, he noted. “So what exactly is the Washtenaw County product that is being advertised and promoted?” He also objected to holding public hearings after midnight, saying that it doesn’t promote participation by the public.

In response to the public commentary, Rolland Sizemore Jr. (D-District 5) expressed his support for Act 88, especially for the funding it provides to the Detroit Aerotropolis, Ann Arbor SPARK, and the Eastern Leaders Group.

Act 88: Board Discussion – Amendment (Increase to 0.09 mills)

When commissioners reached the Act 88 agenda item, Conan Smith (D-District 9) began by proposing a policy and process for allocating Act 88 funds. However, he was told by Curtis Hedger, the county’s corporation counsel, that it would need to be considered later in the agenda, as an item for current or future discussion.

Conan Smith (D-District 9).

C. Smith then referred to a handout that had been provided at the Oct. 3 working session, which outlined Act 88 investment options. The handout listed items that could be funded if the millage remained at the current 0.06 mills ($819,714), or if it were increased to 0.07 mills, 0.08 mills or 0.09 mills. [.pdf of Act 88 options]

C. Smith noted that each of the options was backed by a strategic or business plan, and was built off of work that the county has been doing for several years. For example, a levy of 0.07 mills would allow for $50,000 to fund a commercial kitchen incubator for youth skills development. However, he said, that program doesn’t really thrive unless there’s also funding for a local food manufacturing project – which would require more funding and a higher millage rate.

He also expressed support for a “community capital acceleration” program, which at 0.07 mills would be funded for $10,000. But if it’s not launched with sufficient funding, he said, “we’re sort of undermining our own efforts.”

At that, C. Smith made a motion to amend the proposed 0.07 mills and raise the allocation to 0.09 mills.

Outcome: The motion died for lack of a second.

Act 88: Board Discussion – Amendment (Increase Allocations + Millage Rate)

C. Smith then moved to increase the millage rate in order to fund an increase for the community capital acceleration program  – from $10,000 to $35,000. Dan Smith (R-District 2) supported the motion, noting that his support was in order to move the item forward for debate. It didn’t necessarily mean that he supported the amendment itself.

But C. Smith decided to withdraw that motion. He indicated that there were actually three items that he felt needed an increase in funding – beyond the amounts that would be funded with an 0.07 mill tax. So he moved to increase the millage rate in order to fund increases for those specific items: the community capital acceleration program (from $10,000 to $35,000); a local business employment cooperative (from $15,000 to $50,000); and market analysis for a local food manufacturing, processing and distribution system ($50,000 – this was not funded at 0.07 mills).

He estimated these programs could be funded at his proposed level – a total of $110,000 – by increasing the millage rate to 0.0725 mills.

Outcome: That motion also died for lack of a second.

Act 88: Board Discussion – Amendment (Increase Allocations Only)

Yousef Rabhi (D-District 8) asked Mary Jo Callan – director of the office of community and economic development, which administers several Act 88-funded programs – to come forward and explain the itemized funding list that C. Smith was referencing. She explained that the list was intended to indicate various funding levels for several programs, based on potential increases to the millage rate.

Callan pointed out that the resolution on the board’s agenda that night did not increase the earmarks for specific projects or organizations, compared to the current funding levels. Rather, the resolution would increase the millage rate from 0.06 mills this year to 0.07 mills in 2014. The extra funding would be allocated to the office of community and economic development as a placeholder, to be subsequently allocated to specific programs in the future. She hoped that the board would eventually allocate the extra funds using the process and policy that C. Smith had drafted and shared at the Oct. 3 working session. That’s up to the board, she said.

Alicia Ping (R-District 3) then proposed an amendment that would increase funding in the three line items that C. Smith had mentioned, but without increasing the overall millage rate beyond 0.07 mills.

Rabhi said he couldn’t support Ping’s amendment. The Act 88 resolution needed to move forward, he said, but the board should use C. Smith’s policy to determine priorities for allocating the excess revenues, rather than allocating some of those revenues now. There needs to be more discussion about that, he said.

C. Smith said he appreciated Ping’s effort, but he wouldn’t support it because it would shift funding away from other projects, rather than increase the overall funds. If the overall millage rate isn’t being increased beyond 0.07 mills, then he wanted to go through the process of prioritizing all the possible additional projects.

Outcome: Ping’s amendment was defeated on a 3-6 vote, with support only from Ping, Dan Smith (R-District 2) and Ronnie Peterson (D-District 6).

Act 88: Board Discussion – Partnerships

Rolland Sizemore Jr. (D-District 5) expressed concern that some of the programs supported by Act 88 funds were duplicating efforts that other entities in the county are already pursuing. He noted that Washtenaw Community College, for example, already has a food service program, which might duplicate the proposed commercial kitchen incubator. He also wondered why hotels aren’t helping to pay for it.

Mary Jo Callan replied that OCED can explore more partnerships, in addition to those that are already in place. She said the county did an analysis of what’s available, because they don’t want to duplicate programs. Tony VanDerworp of OCED described the work that’s been done to develop the kitchen incubator proposal, including discussions with local schools. The county doesn’t want to operate it, he said, but would help facilitate the program.

Sizemore also objected to allocating $10,000 for developing the community capital acceleration program, saying there are educational institutions that have expertise that the county might be able to tap without spending money.

Act 88: Board Discussion – Amendment (Exemptions from TIF)

Dan Smith put forward an amendment calling for the Act 88 levy to be exempt from capture by tax increment financing (TIF) districts or authorities in the county to the greatest extent allowed by law.

Andy LaBarre (D-District 7) said he’d support the amendment, but he wondered why it was appropriate for this millage more than any other one.

D. Smith explained that this is a millage that the board votes on every year. He planned to offer a similar amendment for the veterans relief millage. These millages are levied for very specific purposes, and he thought that the millages should be exempt from as much tax capture as possible so that the revenues will be used solely for the purpose that was intended.

Outcome: The amendment was passed 8-1 over dissent from Kent Martinez-Kratz (D-District 1).

Later in the meeting, D. Smith made a similar amendment for the veterans relief millage. It was also passed on an 8-1 vote over dissent from Kent Martinez-Kratz. The board also gave final approval to the increase in the veterans relief millage.

Act 88: Board Discussion – Legal Opinion

Referring to issues raised during public commentary, Ronnie Peterson (D-District 6) indicated that he’d like to see a legal opinion by the board’s next meeting about whether the veterans relief and Act 88 millages are overstepping the county’s constitutional authority.

Yousef Rabhi (D-District 8).

Dan Smith (R-District 2) noted that the staff memo accompanying the Act 88 resolution provides some detail about the history of the Act 88 legislation, in that it predates the state’s Headlee Amendment. [.pdf of Act 88 staff memo]

But he said that despite his repeated requests to the county administrator and corporation counsel, there’s no mention in the staff memo about how the millage is allowed under Article 9, Section 6 of the Michigan Constitution, or the 18-mill levy limit, or the 5.5 mill county operating millage.

D. Smith expressed concern that the Act 88 levy might be unconstitutional. Very few counties are levying Act 88, and Washtenaw County might be the only county that’s levying the veterans relief millage, he said.

Curtis Hedger, the county’s corporation counsel, replied that he and D. Smith had discussed this issue, and that Hedger had provided the legal rationale. However, Hedger said he would never put a legal opinion in a cover memo unless he’s directed by the board to do so. The board is his client – not individual commissioners, he said – and he writes legal opinions under the board’s direction. If the board directs him to write a legal opinion, he’d do that and provide it to commissioners, Hedger said. Once they receive it, he added, they can do with it whatever they want. But he felt uncomfortable putting that kind of detailed legal analysis in a cover memo.

D. Smith noted that the memo points to another state statute as justification for the levy. “I’ve told corporate counsel repeatedly: ‘Convince me that this is indeed a legal levy,’” D. Smith said. If it’s legal, then there would be opportunities to consider a levy under Act 283, and it would give townships the opportunity to consider levies under Act 51. [Act 283 of 1909 and Act 51 of 1951 both address tax levies for road construction and repair.] If those are legal statewide, he added, then there would be over three-quarters of a billion dollars available for roads that could be levied and managed locally. “So I am more than willing to be convinced about these levies and how we are allowed to exceed the very clear constitutional limits,” D. Smith said.

However, he added, Hedger seems to be taking bits and pieces from different statutes “to suit the outcome that’s desired, and I completely disagree with it.” He said he wasn’t asking for a formal legal opinion, but rather for “casual discussion” similar to what’s already in the staff memo, which mentions the Headlee Amendment. There are already specific references to state legislation in the memo, he noted, and he was asking for additional commentary of that nature.

Act 88: Board Discussion – Policy

Later in the meeting, C. Smith put forward a draft policy and process for allocating Act 88 revenues. [.pdf of Act 88 policy] [.pdf of Act 88 process]

Ronnie Peterson supported it, saying he’d like to see something similar for the coordinated funding program, which allocates dollars for human services. He said the Act 88 policy is essential to move forward along with the resolution on setting the Act 88 millage.

Yousef Rabhi said it was up to the board to decide whether to adopt the policy, but he supported it. Andy LaBarre didn’t think the board could come up with a better process than the one C. Smith put forward. He thanked C. Smith for developing it.

Outcome: The Act 88 policy and process was given initial approval with little discussion, over dissent from Rolland Sizemore Jr. (D-District 5). A final vote on that policy will likely occur on Nov. 6.

Veterans Relief, Act 88: Board Votes

Outcome on Act 88: An initial vote on levying Act 88 at 0.07 mills passed on an 8-1 vote, over dissent from D. Smith. A final vote is expected on Nov. 6.

Outcome on Veterans Relief: A final vote on levying 0.0333 mills for indigent veterans services passed unanimously.

Pittsfield State Street CIA

On the agenda was a resolution to approve participation in Pittsfield Township’s State Street corridor improvement authority (CIA).

David Sarns, a member of the State Street corridor improvement authority board in Pittsfield Township, attended the Oct. 16 county board meeting. He did not formally address the board.

The resolution would authorize the county administrator to sign a tax-sharing agreement with Pittsfield Township and the State Street CIA, which is overseen by an appointed board. [.pdf of agreement] The agreement would allow the CIA to capture 50% of any county taxes levied on new development within the corridor boundaries, not to exceed $3,850,464 over a 20-year period, through 2033. The purpose is to provide a funding mechanism for improvements to the State Street corridor roughly between the I-94 interchange and Michigan Avenue, as outlined in the CIA development and tax increment financing plan. [.pdf of TIF plan]

The Pittsfield Township board of trustees held a public hearing on the CIA at its Oct. 9, 2013 meeting. That started the clock on a 60-day period during which any taxing entities within the corridor can “opt out” of participation. The Washtenaw County parks & recreation commission voted at its Oct. 8, 2013 meeting to participate . Other local taxing entities in the corridor are Washtenaw Community College, the Huron Clinton Metro Authority, and the Saline and Ann Arbor district libraries. The Ann Arbor District Library board discussed the issue at its Oct. 21, 2013 meeting.

In total over the CIA’s 20-year period, the plan anticipates capturing about $14 million in local tax dollars. That amount would provide about a local match to be used to secure federal funding for the bulk of the estimated $30 million project.

Pittsfield State Street CIA: Board Discussion – Postponement

Dan Smith (R-District 2) began deliberations by noting that in 2011 and 2012, the board spent considerable time discussing the county’s involvement in an authority “that wasn’t going to cost us anything.” [He was referring to a countywide transit initiative, spearheaded by the Ann Arbor Area Transportation Authority, that ultimately failed to garner support throughout the county. It attempted to create a new transit authority under Act 196, but did not involve TIF financing.]

D. Smith recalled that the first public discussion of the transit authority was in April 2011, with the first vote on it over a year later – on July 17, 2012.

In contrast, the county’s participation in the State Street CIA will cost about $3.85 million over 20 years, he noted. The board was first presented with this proposal at a working session 13 days prior to the Oct. 16 meeting, D. Smith said, and commissioners need more time to sort through concerns.

D. Smith then moved to postpone the item until Nov. 20.

Andy LaBarre (D-District 7) said this is an issue where time is of the essence, and the board should discuss it that night.

Rolland Sizemore Jr. (D-District 5) wondered why D. Smith hadn’t tried to get his questions answered before proposing to postpone. Sizemore also pointed out that there will be two weeks before the board takes its final vote, on Nov. 6. There will be plenty of time to get questions answered. Sizemore noted that several Pittsfield Township officials were attending the meeting and could answer questions.

Outcome: The motion to postpone failed on a 2-7 vote, with support only from D. Smith and Conan Smith (D-District 9).

Pittsfield State Street CIA: Board Discussion – Substitute Resolution

D. Smith then moved a substitute resolution stating that the county would not participate in the CIA. [.pdf of D. Smith's substitute resolution] He said he supported the road improvement project, but objected to the TIF funding mechanism. He noted that the county had the ability to invest directly in the project using general fund money – which is allowed by Act 119 of 2011.

Dan Smith (R-District 2).

He also pointed out that if the county participates in the CIA, the county board would have no control over how its portion of the captured taxes are spent. For example, if certain aspects of the project turn out to be more expensive than anticipated, the CIA board might decide to cut back on items in the plan, such as non-motorized pathways.

The CIA mechanism also only addresses a specific problem in Pittsfield Township, D. Smith noted. There are many parts of the county that can’t use a CIA. For example, North Territorial Road in his district needs improvement, but there’s not enough development along that road to make a CIA viable, he said.

D. Smith also pointed out that the board has not developed any policies or procedures regarding TIFs, to help guide the board’s decisions. Yousef Rabhi (D-District 8) stated that he supported developing such a policy.

Conan Smith (D-District 9) observed that the board has been working to align its general fund investments with its strategic priorities. One way to make those strategic investments is through direct appropriations. Another way is through tax expenditures of DDAs, TIFAs and CIAs that capture dollars that would otherwise go to the general fund, but that are redirected to specific projects. In this particular case, there’s nothing wrong with the proposed State Street project, C. Smith said. But the board hasn’t been investing in road projects as a priority – as those are handled by the road commission. The CIA will capture dollars that won’t be used for investments that the board has set as priorities. Right now, C. Smith said, he’s not comfortable taking money that he thinks should go toward human services, and instead putting those funds into a road project.

C. Smith advocated for developing a rubric to help the board decide whether to invest in road projects, and if so, what specific road projects should be prioritized.

Another concern is that a lot of anticipated revenue for the State Street CIA is rooted in potential future development, C. Smith noted. Some projects would be built regardless of whether improvements are made to the corridor, he said, and those new tax dollars should be going toward priorities like human services. It’s also unclear how much future development will materialize.

These are complicated issues, and that’s why he supported postponement, C. Smith said. Short of that, he thought the county should not participate at this time.

D. Smith pointed out that the decision not to participate would not necessarily be permanent, because the county board could rescind this resolution at any point. Rescinding his resolution would trigger participation in the CIA.

Yousef Rabhi (D-District 8) wondered if the county board could specify how its portion of the TIF capture is allocated within the CIA. That is, could the county earmark its TIF capture for non-motorized transportation elements? Dick Carlisle, the planning consultant who’s been hired by Pittsfield Township to work on this project, replied that in a sense the money is already earmarked. That’s because the non-motorized paths and bike paths are already in the CIA plan. The project wouldn’t be able to proceed without these elements being included, Carlisle said. Mandy Grewal, the township’s supervisor, pointed out that the township zoning requires that new roads be built using Complete Street principles.

Rabhi noted that the county board wouldn’t be adopting the CIA plan, but would be voting on the agreement with Pittsfield Township regarding the CIA, which doesn’t specifically address elements of the plan. Curtis Hedger, the county’s corporation counsel, confirmed that the CIA will decide how the money is spent. Rabhi floated the idea of amending the agreement to include more details about how the county’s money should be spent.

Commissioners Alicia Ping (R-District 3) and Andy LaBarre (D-District 7).

Saying that her patience was wearing thin because of the length of the meeting, Alicia Ping (R-District 3) said there’s nothing that irritates her more than when Lansing tries to tell the county what to do. Now that’s what the county is trying to do to Pittsfield Township, she said. “I think that’s completely out of line.”

Anyone who’s driven through Pittsfield Township will know that it’s radically different now, she said, with better roads and non-motorized paths. These are competent people running the township, she said.

Ping said that the CIA is the best model for this project, because if there’s no growth, the county won’t lose any revenue. “I think we’d be foolish not to support this,” she said. Ping hoped the board would look at the bigger picture.

C. Smith replied, saying it was wrong of Ping to insinuate that his perspective on this is foolish or poorly thought out, or that he didn’t care about people in this community, or that it’s not worth it to talk about more than $3 million in county dollars. This isn’t similar to Lansing telling the locals what to do, he said. This is about what to do with county-generated revenue, he said – whether the board will put it toward priorities that commissioners have articulated over the years, like helping poor people, or whether it will fund a road. “That is an important conversation for us – that’s not foolish,” C. Smith said. “This is about our priorities. So I’m frustrated that it would be just dismissed.” To get brushed off like that is wrong – it’s rude, he said.

Later in the meeting, Ping indicated that she thought she’d said that Pittsfield Township wouldn’t bring a foolish plan to the board. If she’d said something differently, she hadn’t intended to. C. Smith replied by saying that he loved her.

D. Smith noted that this issue isn’t about trust or distrust of Pittsfield Township officials. It’s about a 20-year plan. It’s unlikely that county commissioners will be around in 20 years, and the same is true for members of the Pittsfield Township and CIA boards, he said. The issue is that the county board should properly look out for the $3.8 million in county revenues for the best interest of everyone in the county. “We only have one chance to get out of the CIA and out of TIF capture,” he said. The board would have the chance to join the CIA later, if that’s what commissioners decide after sorting out all these other issues. But once they join the CIA, the control is out of the county’s hands, he said.

Outcome: The vote on D. Smith’s opt-out resolution failed on a 2-7 vote, with support only from D. Smith and C. Smith.

Pittsfield State Street CIA: Board Discussion – Original Resolution

Discussion continued.

D. Smith pointed out that municipalities around the county have found other ways to pay for roads. Ypsilanti Township is using bonds. Scio Township is in the process of levying $85 per parcel in a township-wide special assessment district to fund road repair. The city of Ann Arbor has a 2 mill tax for streets. Superior Township dedicates a significant portion of its general fund budget for roads. Salem Township took money out of its general fund reserves to invest in road repairs on North Territorial. His point was that municipalities have found ways to pay for roads without coming to the county for TIF funding, he said.

The Pittsfield Township board seems to be set on using this mechanism and no other, D. Smith said. He understood their rationale: If the township can get $3.8 million from the county, why should they levy an additional tax on Pittsfield Township residents or use a special assessment? He said that at the Oct. 9 public hearing of the Pittsfield Township board, supervisor Mandy Grewal had claimed that the CIA was the only tool that was available for State Street repair. However, there are other tools available, D. Smith noted.

Pittsfield Township clerk Alan Israel and treasurer Patricia Scribner were among the township officials who attended the Oct. 16 meeting of the Washtenaw County board of commissioners.

D. Smith again stated that he had no problem with this project, but objected to the funding mechanism. There are other ways that the county can participate, which would allow the board to have more control. If the county joins the CIA, then dollars that the taxpayers approved for natural areas preservation would be used for roads. He wasn’t sure how many people would be willing to renew that millage when they find out that the dollars are being used for a different purpose. The same is true for the parks millage, he said.

D. Smith reported that the people who spoke against the CIA at the Oct. 9 public hearing outnumbered supporters. He said Grewal had later characterized opponents of the CIA as her political opponents. He pointed out that in the 2012 election, the entire township board had been unopposed. He said he had serious concerns about the proposal, though he’d like to support the project with a different funding mechanism.

Several other commissioners expressed support for the project, calling State Street an important transportation artery. Yousef Rabhi said that all the concerns he raised at the board’s Oct. 3 working session had been addressed in the agreement that Pittsfield Township brought forward.

Rabhi said it would have been good if commissioner Felicia Brabec (D-District 4) had been appointed to the CIA board, because her district covers Pittsfield Township. Jim Fink, an attorney representing the township, noted that the CIA board is appointed by the township supervisor and the state statute doesn’t prohibit appointing a county commissioner. Rabhi said he wouldn’t push the issue of a board appointment, but he hoped it would be considered in the future.

D. Smith clarified with consultant Dick Carlisle that the county’s EECS tax (enhanced emergency communication system) would be exempt from capture, based on the agreement that the county board would be voting on that night. Carlisle also confirmed for Smith that the tax capture would apply to increases due to inflation as well as increases resulting from new development.

In total, the board debated the issue and asked questions of Pittsfield Township representatives for about 90 minutes. Questions were fielded by supervisor Mandy Grewal, consultant Dick Carlisle, attorney Jim Fink, and Craig Lyon, the township’s director of utilities and municipal services.

Outcome: Commissioners voted 8-1 to give initial approval to participate in the CIA, with dissent from Dan Smith (R-District 2). A final vote is expected on Nov. 6.

Pittsfield State Street CIA: TIF Policy

Near the end of the meeting, Yousef Rabhi brought forward a resolution directing county administrator Verna McDaniel to develop a policy for evaluating future tax increment financing (TIF) proposals. The resolution stated that the policy would be developed with input from staff of the office of community and economic development, the equalization department, and the brownfield redevelopment authority.

Alicia Ping (R-District 3) indicated she would not support this, because each TIF proposal is unique.

Outcome: The item passed on a 7-2 vote with dissent from Dan Smith (R-District 2) and Alicia Ping (R-District 3).

Washtenaw County Court Budget

On the Oct. 16 agenda was an item giving final notice to eliminate a lump-sum budgeting approach for Washtenaw County’s court system.

Donald Shelton, chief judge of the Washtenaw Trial Court.

The issue had arisen this summer, when commissioner Alicia Ping (R-District 3) had brought forward a resolution to give notice to the courts. She did that at the board’s June 5, 2013 meeting in a move that caught some commissioners by surprise, although for several weeks during earlier budget deliberations Ping had expressed concerns over the county’s approach to funding the court system. Voting in favor of initial approval on June 5 were Ping, Conan Smith, Dan Smith, Andy LaBarre and Kent Martinez-Kratz. Voting against the proposal initially were Yousef Rabhi, Ronnie Peterson, Rolland Sizemore Jr. and Felicia Brabec.

Then at the county board’s July 10, 2013 meeting, when the item was on the agenda for final approval, the board had voted to postpone a final vote until Oct. 16. The rationale was that it should be coordinated with approval of the 2014 budget.

Ping had stated that her goal wasn’t necessarily to cut funding for the courts, but rather to be more transparent about where the money goes. Giving a notice to terminate the agreement would have given the board the option to end it.

The courts have historically been in favor of a lump-sum approach, rather than the line-item budget provided by most other units of county government. The courts operate under a memorandum of understanding with the board of commissioners. The board unanimously approved that MOU on Jan. 19, 2011, replacing one that had been in place since 1990. [.pdf of memorandum of understanding] The agreement states that the county will provide “lump sum” funding to the courts, allocated to: (1) the trial court – an entity that includes the 22nd Circuit Court, court clerk services, juvenile court, Friend of the Court, and probate court; (2) 14A District Court; and (3) a portion of the county’s child care fund. The county does not have line-item budgeting authority, but the courts agreed to submit a bi-annual line-item budget, and to provide quarterly financial projections.

From the general fund, the lump-sum payment to the courts in 2013 totals $19,155,029 – with $13,353,110 for the trial court and $5,801,919 for district court. In addition, state funding for certain trial court operations – the Friend of the Court and child care fund – totals $4,977,047.

On July 10, Ping reported that chief judge Donald Shelton had provided a detailed document regarding the court’s budget, and that he had indicated a willingness to meet with commissioners and the administration about this issue. She said she wanted to give commissioners time to digest the additional information, and to hear the county administrator’s budget proposal for the general fund. County administrator Verna McDaniel and her finance staff presented a four-year budget proposal for 2014-2017 at the board’s Oct. 2, 2013 meeting.

Washtenaw County Court Budget: Board Discussion

The board reached this item on the agenda after midnight. Dan Smith (R-District 2) began deliberations by noting that on Oct. 15, a state Senate committee had voted on HB 4704, which would change the law about who can bring lawsuits against the county. The bill has already passed the House and will be taken up soon by the Senate. Given that, he moved to postpone the county board resolution until Dec. 4.

The legislation was described in an email sent to the board from the Michigan Association of Counties:

The bill will encourage countywide elected officials to work budget issues out with the county board of commissioners, rather than threaten or file a lawsuit. In addition to requiring the parties to talk, there are three main changes to current law. The bill provides an assumption that the appropriated amount is at a “serviceable level,” so the burden of proof is on the countywide elected official who chooses to sue. In addition, the bill requires the court to take into account the county board’s “ability to pay” in deciding the lawsuit. Finally, the bill requires that the countywide elected NOT spend over the budgeted amount prior to a decision in the case. These changes will help make sure that when a case occurs it is warranted, and it will help cut down on threats and frivolous filings.

Previous discussions about the court system’s budget have been tempered by the fear that the court might sue the county, if the board of commissioners didn’t provide adequate funding.

Ronnie Peterson (D-District 6) noted that chief judge Donald Shelton and court administrator Dan Dwyer had been waiting all night. He wanted to show them respect, he said. He noted that the bill would still require further action in the state legislature – noting that it may or may not be signed into law.

Shelton spoke briefly to commissioners, saying he welcomed an opportunity to continue the collegial relationship between the board and the courts, and he didn’t think a postponement would help with that relationship.

Outcome on postponement: It was defeated on a 1-8 vote, with support only from Dan Smith (R-District 2).

Outcome on main item: The final vote to eliminate lump-sum budgeting failed on a 3-6 vote, with support from only Dan Smith (R-District 2), Conan Smith (D-District 9) and Kent Martinez-Kratz (D-District 1).

Coordinated Funding

Commissioners were asked to give initial approval to an extension of the coordinated funding approach for human services, as well as to some changes in that funding model.

No dollar amounts were allocated, but the resolution authorized the allocation of children’s well-being and human services funding for 2014 through 2016. It authorized the continued management of those funds through the county’s office of community & economic development, using the coordinated funding approach – with some modifications.

The county is one of five partners in the coordinated funding approach. Other partners are city of Ann Arbor, United Way of Washtenaw County, Washtenaw Urban County, and the Ann Arbor Area Community Foundation. It began as a pilot program in 2010; this is the second time that the program has been extended.

The coordinated funding process has three parts: planning/coordination, program operations, and capacity-building. The approach targets six priority areas, and identifies lead agencies for each area: (1) housing and homelessness – Washtenaw Housing Alliance; (2) aging – Blueprint for Aging; (3) school-aged youth – Washtenaw Alliance for Children and Youth; (4) children birth to six – Success by Six; (5) health – Washtenaw Health Plan; and (6) hunger relief – Food Gatherers.

Last year, TCC Group – a consulting firm based in Philadelphia – was hired to evaluate the process. As a result of that review, several changes were recommended. Those recommendations would also be authorized as part of the county board’s overall coordinated funding resolution, as described in a staff memo:

The County’s Human Services and Children’s Well-being funding will continue to focus on critical services for early childhood, aging, housing/homelessness, safety net health, school-aged children and youth, and food security/hunger relief. Under this proposal, this funding will not necessarily be allocated to these six priority areas in proportional amounts consistent with historic trends. Allocations to these six priority areas will be based on identified community-level outcomes, the strategies that align with them, and how each are prioritized.

1) Under this proposal, the application pre-screening process will be broadened to better accommodate smaller non-profit organizations. New types of financial documentation will allow smaller agencies to illustrate their viability in the absence of an independent audit. 2) Capacity-building grants would be available to target smaller agencies that need to improve their governance or financial structure to be eligible for the application process, with the goal of expanding the opportunities for all agencies providing human services in the County in an equitable fashion.

Recommendations for specific funding allocations will be made to the county board in April 2014, for funding to start on July 1, 2014. In addition, the RNR Foundation – a family foundation that funded TCC Group’s evaluation of the coordinated funding approach – will now be an additional funder in this process. One of the goals of coordinated funding is to attract more partners, such as private foundations.

Coordinated Funding: Public Commentary

Tom Partridge introduced himself as a write-in candidate for Ward 5 Ann Arbor city council. He called for the county to go beyond the coordinated funding proposal and provide more extensive affordable housing, public transportation, and health care, and to end homelessness. He objected to the coordinated funding approach of giving money to multiple nonprofits, each with an executive director. He urged commissioners to put a countywide millage on the ballot for human services.

Coordinated Funding: Board Discussion

Ronnie Peterson (D-District 6) asked how needs are being determined, and when applications for funding would be coming to the board for approval.

Ronnie Peterson (D-District 6).

Mary Jo Callan, director of the office of community & economic development, reminded commissioners that this vote would authorize continuation of the coordinated funding process. This wasn’t a vote to allocate specific dollars. She reviewed the history and approach that’s being used, as well as the review that was funded by the RNR Foundation.

Peterson said he was concerned about the direction that the county was taking, in terms of delivering services to those most in need. The board needed to make sure that its issues are addressed, and other entities should do the same, he said.

Callan explained that the request for proposals (RFP) is released in January, and the staff will bring back recommendations in April or May. Peterson said he hoped the board would have a discussion about priorities before the RFP is issued.

Conan Smith (D-District 9) said he agreed with Peterson, in that the board needs to set clear priorities for funding. What are the outcomes that the board expects from its funding? He thought the board should vote on metrics that the staff recommends – but that’s not happening, he said.

Callan disagreed, though she acknowledged that there seems to be a feeling that the board wasn’t consulted. She noted that during the last funding cycle, the staff brought to the board specific priorities and funding amounts for approval, before any dollars were distributed.

Callan said this next cycle will include further developing of community outcomes, much like the county board is doing for its budget priorities. It’s important to know whether investments are making a difference in the community, she noted. So there will be specific community outcomes developed for each of the six priority areas in the coordinated funding model. The outcomes will be developed using data and best practices, working with people who are out in the community doing this work.

C. Smith confirmed with Callan that she’ll be bringing back these outcomes and metrics to the board before the RFP is issued.

Outcome: Commissioners voted 8-1 to give initial approval to the coordinated funding program. A final vote is expected on Nov. 6.

2014-2017 Budget

No one spoke at a public hearing on the proposed 2014-2017 Washtenaw County general fund budget, which took place after midnight.

County administrator Verna McDaniel and board chair Yousef Rabhi (D-District 8).

County administrator Verna McDaniel and her finance staff had presented the budget on Oct. 2, 2013.

The $103,005,127 million budget for 2014 – which represents a slight decrease from the 2013 expenditures of $103,218,903 – includes putting a net total of 8.47 full-time-equivalent jobs on “hold vacant” status, as well as the net reduction of a 0.3 FTE position. The recommended budgets for the following years are $103,977,306 in 2015, $105,052,579 in 2016, and $106,590,681 in 2017. The budgets are based on an estimated 1% annual increase in property tax revenues. [.pdf of draft budget summary]

McDaniel had previously indicated that the county would need to find $3.9 million in structural savings in 2014. On Oct. 2, she reported that $4.13 million in operating cost reductions had been identified.

An item on the Oct. 16 agenda called for continued discussion of the 2014-2017 budget. However, by the time the board reached that point in the agenda, it was about 11:30 p.m. Dan Smith (R-District 2) moved to postpone discussion until Nov. 6.

Outcome: Commissioners unanimously voted to postpone discussion of the 2014-2017 budget until Nov. 6.

Apportionment Report

On the Oct. 16 agenda was a resolution to approve the 2013 apportionment report – giving details of the 2013 taxable valuations for property in the county, broken down by municipality. The report also includes the amount of millages levied and the dollar amounts collected in taxes. December tax bills will be mailed out to property owners based on these calculations. [.pdf of 2013 apportionment report]

In April, the county’s equalization department produces an annual report describing Washtenaw County’s total equalized (assessed) value of property. The report is part of a state-mandated equalization process, and gives an indication of how much revenue the county will receive from property taxes in the coming year. [See Chronicle coverage: "Equalization: Washtenaw Property Values Rise."]

From left: Equalization director Raman Patel and commissioner Dan Smith (R-District 2).

Later in the year – in October or November – the equalization and property description department presents an apportionment report, which gives details of the taxable valuations for property in the county, by municipality. The report also includes the amount of millages levied and the dollar amounts collected in taxes. Like the equalization report, the board is required by state law to vote on adopting the apportionment report.

This year, all the taxing entities in Washtenaw County will be levying in total an estimated $629.608 million in property taxes – an increase from $621.687 million in 2012. It’s also an increase from $622 million in 2011, but has not yet regained ground to the level of $639 million in 2010.

The county alone will levy an estimated $80.669 million, including millages for the general fund, parks & recreation, and Huron Clinton Metroparks.

Apportionment Report: Board Discussion

Raman Patel – who retired from his position as the county’s equalization director in late 2011 but remains in that job on a contract basis – presented the report and fielded questions from commissioners. He noted that an outstanding item needed to complete the report was the board’s decision to set the rate for the veterans relief and Act 88 millages. He also suggested that the board indicate whether those millages are subject to capture by local tax increment financing (TIF) districts, like downtown development authorities.

Ronnie Peterson (D-District 6) asked whether Patel could forecast the tax revenue out three or four years. Patel replied that it’s much more difficult to predict tax revenues now, recalling how several years ago the property values tanked within a six-month period. “So you don’t know what the market is going to do,” Patel said.

Dan Smith (R-District 2) noted that Patel’s cover memo indicated that the equalization staff had reviewed all the millages levied in the county to make sure that they’ve complied with Article 9, Section 31 of the state constitution. Smith wondered if a similar evaluation was done with Article 9, Section 6 regarding the millage limits that are specified. That section states, in part:

Except as otherwise provided in this constitution, the total amount of general ad valorem taxes imposed upon real and tangible personal property for all purposes in any one year shall not exceed 15 mills on each dollar of the assessed valuation of property as finally equalized. Under procedures provided by law, which shall guarantee the right of initiative, separate tax limitations for any county and for the townships and for school districts therein, the aggregate of which shall not exceed 18 mills on each dollar of such valuation, may be adopted and thereafter altered by the vote of a majority of the qualified electors of such county voting thereon, in lieu of the limitation hereinbefore established. These limitations may be increased to an aggregate of not to exceed 50 mills on each dollar of valuation, for a period of not to exceed 20 years at any one time, if approved by a majority of the electors, qualified under Section 6 of Article II of this constitution, voting on the question.

Yes, Patel said – that’s the responsibility of his department too. There are about 75-80 different millages levied in Washtenaw County, he explained, and his staff has to make sure that each millage complies with the state law. “It’s not a small task,” he noted. Patel reviewed some of the history related to this issue. Of all the municipalities in Washtenaw County, only three cities don’t levy at the maximum rate allowed without voter approval: Saline, Milan and Chelsea.

In response to another query from D. Smith, Patel said he didn’t think any municipality would reach the 50 mill aggregate limit in his lifetime. He noted that after Proposal A, school millages are no longer calculated as part of that total.

Outcome: Commissioners unanimously approved the 2013 apportionment report.

Chelsea Milling Brownfield

Commissioners were asked to give initial approval to a proposed brownfield plan by the Chelsea Milling Co., makers of Jiffy Mix. [.pdf of brownfield plan] A public hearing was also scheduled for the Oct. 16 meeting.

The plan relates to a renovation of an abandoned 77,700-square-foot warehouse at 140 Buchanan in the city of Chelsea. The company plans to invest more than $4 million in the project, according to a staff memo that accompanied the Oct. 16 resolution.

If the project is given brownfield status, it would allow the company to be reimbursed for up to $376,805 in eligible activities through tax increment financing (TIF). The total amount to be captured through TIF over 16 years is $580,677, which includes fees paid to the county brownfield program administration and the county’s local site revolving remediation fund.

Chelsea Milling Brownfield: Public Hearing

The public hearing took place after midnight and only one person – Lara Treemore Spears of ASTI Environmental, a representative from the project – spoke briefly. She indicated that two company officials had been at the meeting but left around 11:30 p.m. She thanked the board for considering the plan, and briefly described the investment planned by the company.

Chelsea Milling Brownfield: Board Discussion

Dan Smith (R-District 2) pointed out that the plan lists several previous owners, including the city of Chelsea. None of those entities are responsible for cleanup, so he wanted to know how Washtenaw County got “stuck with the bill.”

Nathan Voght, the county’s brownfield program coordinator, explained that in general, the state’s previous approach of going after the original polluters to get them to pay for cleanup didn’t work. So in 1996 the state enacted Act 381 – the brownfield redevelopment financing act. The act provides a funding mechanism to help new entities redevelop a contaminated site. Voght said the idea is that since society allowed this to happen, communities should pitch in to help clean it up.

Kent Martinez-Kratz (D-District 1).

Responding to another question from D. Smith, Voght noted that environmental laws are stronger now than decades ago, and that will help prevent similar contamination in the future.

D. Smith then pointed to a table in the brownfield report that listed eligible activities totaling $376,805. Most of those activities relate clearly to cleanup, he noted. But it also includes demolition – at $221,550. That seems to be in a different category, D. Smith said, and he asked Voght to explain why it was also eligible for funding. Voght said a brownfield site doesn’t just include contaminated ground. It includes everything that’s an impediment to development, and oftentimes that includes old buildings or factories, which might include asbestos.

D. Smith then highlighted a table that listed out the amount of taxes that would be captured from each taxing entity, as part of the brownfield plan. [.pdf of tax capture table] He noted that another item on the agenda – a proposal from Pittsfield Township for a State Street corridor improvement authority – would exempt some taxes from capture. He asked if similar exceptions were possible for the brownfield project. Voght replied that there are no exemptions for brownfield projects, nor are there opt-out provisions, as there are for the CIA.

Responding to a question from Kent Martinez-Kratz (D-District 1), Voght reported that in general, tax capture in Washtenaw County comes from about 24 mills in state taxes, and from local millages ranging from 25 to 35 mills. Depending on where a project is located, about 40% of the tax capture is from state taxes, and 60% from local taxes.

Outcome: Commissioners voted unanimously to give initial approval to the brownfield plan. A final vote is expected on Nov. 6.

Road Commission Appointment

The appointment of Barb Fuller to the Washtenaw County road commission was on the Oct. 16 agenda. She was nominated by board chair Yousef Rabhi (D-District 8) to fill a seat vacated by Ken Schwartz when he took over as supervisor for Superior Township on Oct. 1. The position is for the remainder of a six-year term, through Dec. 31, 2016.

The appointment had originally been on Oct. 2 agenda, but Dan Smith (R-District 2) raised the question of whether Schwartz had officially resigned. So on Oct. 2 the board voted 6-3 to postpone her appointment, over dissent from Rabhi, Rolland Sizemore Jr. (D-District 5) and Andy LaBarre (D-District 7).

This item was considered after midnight at the Oct. 16 meeting. There was minimal discussion. Ronnie Peterson (D-District 6) raised concerns about the process for soliciting applications. Rabhi and Pete Simms of the county clerk’s office both described ways in which the vacancy had been publicized, including ads in print publications and in media reports. Rabhi indicated that another person who had applied had missed the deadline.

Fuller, who lives in Manchester, previously served as deputy supervisor in Pittsfield Township from 2008-2012. She provides organizational management and consulting services, and has served in a variety of leadership roles for groups including the Washtenaw Community College Foundation Women’s Council and the Montessori School Board. She is the first woman to serve on the road commission since Pam Byrnes was appointed in 2000. Byrnes had been the first woman ever to serve on the road commission, but resigned before the end of her six-year term, when she was elected to the Michigan House of Representatives in 2004.

Other current road commissioners are Doug Fuller (no relation to Barb Fuller) and Fred Veigel, who also is a member of the county’s parks & recreation commission. The salary for road commissioners, which is set by the county board, is $10,500 annually.

Barb Fuller takes the position as the county board explores possible changes to the road commission. At its Oct. 2, 2013 meeting, the board created a new seven-member subcommittee to “explore partnerships and organizational interactions with the Washtenaw County Road Commission.” Members include four county commissioners – Alicia Ping (R-District 3), Conan Smith (D-District 9), Dan Smith (R-District 2) and Rolland Sizemore Jr. (D-District 5) – and three township supervisors: Mandy Grewal of Pittsfield Township, Ken Schwartz of Superior Township and Pat Kelly of Dexter Township.

Outcome: Barb Fuller’s nomination was confirmed on an 8-1 vote. Dan Smith (R-District 2) cast the only dissenting vote.

Dog License Civil Infraction

Commissioners held a public hearing at their Oct. 16 meeting on a proposed ordinance that would allow the county to issue municipal civil infractions for owning an unlicensed dog. The proposal would also establish that the county treasurer’s office would be the bureau for administering these infractions, and would set new licensing fees.

No one spoke on the hearing, which was held after midnight.

About a year ago, at the county board’s Nov. 7, 2012 meeting, commissioners approved a civil infractions ordinance that gave the county more flexibility to designate violations of other county ordinances as a civil infraction, rather than a criminal misdemeanor. For example, enforcement of the county’s dog licensing ordinance is low because the current penalty – a criminal misdemeanor of 90 days in jail or a $500 fine – is relatively harsh. The idea is that enforcement would improve if a lesser civil infraction could be used. The civil infraction fines are $50 for a first offense, $100 for a second offense, and $500 for a third or any subsequent offense.

An increase in the enforcement is expected to result in an increase in the number of dog licenses, which would provide additional revenue to be used for animal control services.

However, the county board hasn’t yet taken the additional step of authorizing the issuance of a civil infractions for owning an unlicensed dog. There was no agenda item put forward for a vote on this issue at the Oct. 16 meeting, nor was there any resolution on the agenda regarding a new fee structure for dog licenses.

The county treasurer’s office is proposing to lower the current dog licensing fee from $12 to $6 per year for spayed or neutered dogs and from $24 to $12 per year for dogs that aren’t spayed or neutered. There would continue to be a discount for a three-year license. More information about current dog licenses are on the county website.

After the Oct. 16 meeting, county staff emailed a copy of the draft ordinance to The Chronicle. [.pdf of dog license ordinance] [.pdf of staff memo and resolution]

Outcome: This was not a voting item.

Present: Felicia Brabec, Andy LaBarre, Kent Martinez-Kratz, Ronnie Peterson, Alicia Ping, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith, Dan Smith.

Next regular board meeting: Wednesday, Nov. 6, 2013 at 6:30 p.m. at the county administration building, 220 N. Main St. in Ann Arbor. The ways & means committee meets first, followed immediately by the regular board meeting. [Check Chronicle event listings to confirm date.] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public commentary is held at the beginning of each meeting, and no advance sign-up is required.

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Postponement is until Nov. 7 – which is the last meeting of the current composition of the council. City council elections are held Nov. 5.

The revision to Chapter 7 would clarify the existing language of the ordinance. The clarification would disallow the DDA’s preferred interpretation of a restriction on TIF revenue that’s expressed in the ordinance language. This ordinance revision was first considered by the council in February of this year. It received initial approval in April and has been in front of the council several times since then, but always postponed.

A joint committee of councilmembers and DDA board members has been meeting, most recently on Oct. 16. The group appears headed toward an alternative that would enact a “cap” on DDA TIF revenue – that could be set at a high enough level not to have a substantive impact on actual TIF revenue. When that alternative is finalized, it would be brought forward as a substitute proposal.

Depending on the outcome of the Nov. 5 election, the alternative approach might be more or less difficult for the council to enact, if the ordinance revision winds up being postponed again at the Nov. 7 meeting.

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

The sign on the door to the Ann Arbor city council chamber, installed in the summer of 2013, includes Braille.

It’s possible that the council might be briefed at the meeting on proposals received by the Oct. 18 deadline for the purchase of the city-owned parcel on William Street between Fourth and Fifth avenues (the former Y lot), but that’s not yet clear. The property had been listed for $4.2 million.

Many of the Oct. 21 items already on the agenda can be divided into three main categories: transportation, the Ann Arbor Downtown Development Authority, and the city’s energy commission.

The council held a work session about transportation on Oct. 14, 2013. Transportation-related items on the Oct. 21 agenda include a resolution that would admit Ypsilanti Township as a member of the Ann Arbor Area Transportation Authority. The specific question to be considered is a revision to the AAATA’s articles of incorporation – which would also expand the number of board members from nine to 10.

A second transportation-related agenda item is a city-led initiative to develop a new train station, with the location to be determined. The existing location, as well as one on Fuller Road near the University of Michigan medical campus, would be among the possibilities. On the council’s agenda is a contract with URS Corp. to conduct an environmental review that would include public engagement, site selection and conceptual design. The council’s authorization would be $824,875, an amount that includes a $63,083 contingency. The city would pay 20% of that, or about $165,000, with the rest covered by a federal grant that has already been awarded by the Federal Rail Authority.

To the extent that pedestrian infrastructure is also part of the city’s transportation system, a transportation-related pair of items would alter the definition of “sidewalk” to include cross-lot walkways. Affected by the change, for example, would be walkways that connect streets with parks or school property. The change would allow for use of sidewalk repair millage funds to repair cross-lot walkways, without triggering the winter maintenance requirement for adjacent property owners.

Finally, the city council will be asked to approve an annual resolution related to wintertime transportation – the purchase of ice control salt for city streets.

Related to the Ann Arbor DDA are three items: (1) reconsideration of the appointment of Al McWilliams to the board of that authority – likely to be confirmed on a re-vote, if reconsideration is approved; (2) final consideration of a change to the city ordinance regulating the DDA’s TIF (tax increment financing) capture – likely to be postponed yet again; and (3) a budget allocation of $280,000 to cover costs associated with replacement of downtown ornamental, pedestrian-scale light poles. The DDA is contributing $300,000 to the cost of the $580,000 project. Some councilmembers think the DDA should pay for the full amount, so the eight-vote majority required for the budget amendment might not be achieved.

The specific size of the majority vote required could also be a factor in one of two agenda items related to the city’s energy commission – the re-appointment of Wayne Appleyard to the commission. The confirmation will need a seven-vote majority under the city charter, because he’s not a city resident. The other energy-related item is an energy commission-recommended resolution – which was previously rejected, reconsidered and postponed by the city council. The resolution would call upon the city’s employee retirement board to divest from fossil fuel companies.

This article includes a more detailed preview of each of these agenda items. More details on other meeting agenda items are available on the city’s online Legistar system. Readers can also follow the live meeting proceedings Monday evening on Channel 16, streamed online by Community Television Network.

The Chronicle will be filing live updates from city council chambers during the meeting, published in this article below the preview material. The meeting is scheduled to start at 7 p.m.

Transportation

Three transportation-related issues appear on the agenda.

Transportation: Ypsilanti Township Membership in AAATA

The council will be asked to approve revised articles of incorporation for the Ann Arbor Area Transportation Authority, so that Ypsilanti Township is admitted as a member of the authority. The board would be expanded from nine to 10 members, with the additional member to be appointed by Ypsilanti Township. At its Sept. 26, 2013 meeting, the AAATA board already approved the membership of Ypsilanti Township. That action was contingent on approval by the Ann Arbor city council.

Ypsilanti Township is now a member of the Ann Arbor Area Transportation Authority, pending consideration by the Ann Arbor and Ypsilanti city councils. (Green indicates the geographic area included by the AAATA.)

An earlier expansion in membership was given final approval by the AAATA board at its June 20, 2013 meeting. That’s when the city of Ypsilanti was admitted as a member of the AAATA and its board was increased from seven to nine members, one of whom is appointed by the city of Ypsilanti. The name of the authority was also changed at that time to add the word “area” – making it the Ann Arbor Area Transportation Authority. [Amendment 3 of the AAATA articles of incorporation]

The expansion of the AAATA’s geographic footprint to include some jurisdictions geographically close to the city of Ann Arbor – and with whom the AAATA has historically had purchase-of-service agreements (POSAs) – sets the stage for a possible request of voters in the expanded geographic area. That request would be to approve additional transportation funding to pay for increased service frequencies and times.

The AAATA could place a millage request on the ballot in May 2014, probably at the level of 0.7 mills, to support a 5-year service improvement plan that the AAATA has developed. A schedule of public meetings to introduce that plan runs through mid-November. A decision to place a millage on the ballot would first need AAATA board approval – a question that has not yet appeared before the board.

Transportation: Ann Arbor Station

Appearing on the Oct. 21 agenda is a contract with URS Corp. Inc. (URS) to carry out an environmental review of the Ann Arbor Station project. This rail station project relates most immediately to the prospect that Amtrak will be offering improved inter-city service on the Chicago-Detroit Amtrak line.

Amtrak train arrival in Ann Arbor. (Chronicle file photo from September 2013)

An improved intercity rail station also has implications for the way that a different type of service – commuter rail service between Ann Arbor and Detroit – might be created and offered in the future. The total budgeted for the Ann Arbor Station contract on the Oct. 21 agenda – which will cover public engagement, site selection and conceptual design – is $824,875, an amount that includes a $63,083 contingency. The city would pay 20% of that, or about $165,000. A transfer of $550,000 to the city’s major grant fund was approved a year ago by the city council at its Oct. 15, 2012 meeting for the total project budget.

The federal grant that will cover 80% of the project cost, up to $2.8 million for the federal share, had been accepted by the council at its June 4, 2012 meeting. So for the contract on the Oct. 21 agenda, the city’s share works out to approximately $165,000 with the Federal Rail Authority covering the remaining $660,000.

The funding approved by the city council a year ago came after the city learned that previous expenditures – which were made in connection with the now demised Fuller Road Station project – would not be considered as eligible local matching funds under the federal grant. Fuller Road Station had been a joint venture with the University of Michigan, and called for UM to build a parking structure on the same site as the proposed rail station at a location on Fuller Road.

The preliminary work that URS would do under the contract on the Oct. 21 agenda does not presuppose a preferred location for a new passenger rail station. The existing Amtrak station on Depot Street would be among the alternatives considered, in addition to the location identified for the Fuller Road Station, which is on city-owned land between Fuller Road and East Medical Center Drive adjacent to the UM medical center. The Fuller Park land is designated by the city in planning documents as parkland, and is zoned as public land. A 2009 appraisal commissioned by the city put the value of the land at $4.25 million.

Transportation: Sidewalks

The ordinance change in front of the council for final approval on Oct. 21 would revise the definition of “sidewalk” so that cross-lot walkways could be repaired using sidewalk repair millage funds, but not trigger the ordinary winter maintenance requirement for adjacent property owners. Cross-lot walkways include those that connect streets to parks or school property, or connect two parallel streets.

At the council’s July 1, 2013 meeting, councilmembers were set to give final approval of a different version of the ordinance revision, which would have still placed the responsibility of sidewalk shoveling in the winter on owners of property adjacent to cross-lot walkways. But the council took a different approach after hearing objections from the owners of adjoining property.

A companion resolution later on the agenda completes the necessary council action to allow the definitional change to have an actual impact: The definition makes a walkway a “sidewalk” if the council formally accepts the walkway for public use.  So the companion resolution accepts 34 cross-lot walkways for public use.

This cross-lot path was described by John Ohanian at the city council’s July 1, 2013 meeting as one that he’d become responsible for shoveling if the city adopted the change in the definition of sidewalk.

This is the path – looking east from Frederick and Middleton into Greenbrier Park – that abuts Ohanian’s property.

Transportation: Ice Control Salt

The request to be considered by the council is for the purchase of bulk salt, for ice control, and seasonal back-up supplies to be sourced from the Detroit Salt Company for $245,143 (2,800 tons of “early fill” at $34.50 a ton and 4,100 tons of “seasonal backup” at $36.23 a ton).

Winter use of ice control salt on roadways by the city of Ann Arbor (in tons). Data from the city of Ann Arbor. Chart by The Chronicle. This year the council is being asked to authorize the purchase of a total of 6,900 tons of ice control salt.

Ann Arbor Downtown Development Authority

Three items on the Oct. 21 agenda relate to the Ann Arbor Downtown Development Authority.

Ann Arbor DDA: Al McWilliams

The item on the council’s Oct. 21 agenda is a reconsideration of the council’s vote that appointed Al McWilliams to the board of the Ann Arbor Downtown Development Authority. That original vote was taken on Sept. 16, and resulted in a 6-5 tally in favor.

Al McWilliams attended the Oct. 2, 2013 meeting of the DDA board and voted on the one agenda item. This photo is from Chronicle coverage of that meeting.

The Sept. 16 vote came after mayor John Hieftje stated during deliberations on Sept. 3 – as McWilliams’ confirmation that night appeared to have insufficient support on the short-handed council – that he was withdrawing the nomination.

That gave rise to a technical procedural issue – because Hieftje’s request for confirmation on Sept. 16 appeared to be a fresh nomination. So it should have been subjected to the council’s rule that applies when the vote comes at the same council meeting as the nomination – namely, that the confirmation achieve an eight-vote majority. For detailed analysis of the procedural issue, see “Column: How to Count to 8, Stopping at 6.”

City attorney Stephen Postema was then directed by the council at its Oct. 7 meeting to produce a written opinion on the legal validity of the 6-5 vote, which he subsequently did. Later in the Oct. 7 meeting, Chuck Warpehoski (Ward 5) convinced his council colleagues to re-open the agenda to consider a motion to reconsider the Sept. 16 vote on McWilliams. Warpehoski could do that as someone who voted on the prevailing side.

That motion for reconsideration was immediately postponed until the Oct. 21 meeting. Even if successful, Warpehoski’s motion is unlikely to result in a change of any councilmember’s vote, but would serve to eliminate the procedural question about McWilliams’ appointment. On Oct 21, the first vote to be taken will be on the motion to reconsider. If at least six councilmembers vote to reconsider, then the question of the appointment itself will be in front of the council.

Ann Arbor DDA: DDA TIF Ordinance

An ordinance revision to Chapter 7 that’s in front of the council for final approval on Oct. 21 would clarify the existing language of the ordinance, which regulates the DDA’s TIF capture. The clarification would disallow the DDA’s preferred interpretation of a restriction on TIF revenue that’s already expressed in the ordinance language. This ordinance revision was first considered by the council in February of this year. It received initial approval in April and has been in front of the council several times since then, but always postponed. Another postponement is likely on Oct 21.

A joint committee of councilmembers and DDA board members has been meeting, most recently on Oct. 16, and appear headed toward an alternative that would enact a “cap” on DDA TIF revenue – that could be set at a high enough level that it might not have a substantive impact on actual TIF revenue. When that alternative is finalized, it would be brought forward as a substitute proposal. But based on the Oct. 16 committee meeting, that won’t be ready for the Oct. 21 council meeting.

Ann Arbor DDA: Main Street Light Poles

The city council will be asked to approve $280,000 to be spent replacing 81 light poles in downtown Ann Arbor. The light poles will be purchased from Spring City Electrical Manufacturing at a cost of $173,307, with additional costs for installation and labor bringing the total to $280,000.

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

The expenditure would amount to the city’s portion of a $580,000 project to replace 81 light poles – with the other portion of the cost borne by the Ann Arbor Downtown Development Authority.

The $280,000 for the city’s share still needs to be allocated from the general fund to the field operation unit’s FY 2014 street lighting budget. As a budget amendment, the resolution needs eight votes under the city charter. It might not achieve that number, because of the ongoing political wrangling between the Ann Arbor DDA and the city council.

By way of additional background, in April 2013 when the council gave initial approval of the change to the city ordinance that regulates the DDA’s TIF capture, an argument against that move was that it would leave the DDA without sufficient revenue to pay for the roughly $580,000 cost of replacing the decorative light poles, which are described by some as an iconic feature of Main Street.

Replacement was characterized as an urgent public safety issue, because the bases of some of the poles are rusting. Various statements were made about the number of light poles that had failed, but 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. As a part of the council’s FY 2014 budget deliberations, the council altered the DDA’s budget and directed the DDA to allocate $300,000 toward the replacement of the Main Street light poles.

The council’s specific action 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 budget resolution also recommended that the DDA spend $300,000 of its TIF fund on the Main Street light pole replacement. Earlier this year, in response to an emailed query from The Chronicle, city administrator Steve Powers indicated that the city council was expected to be asked to act on the matter either at its July 15 or Aug. 8 meeting. But the issue was not placed before the council until Oct. 21.

City Energy Commission

Two items on the Oct. 21 agenda relate to the city’s energy commission.

City Energy Commission: Appleyard Appointment

On the agenda as of Friday, Oct. 18 was just one appointment – that of Wayne Appleyard to the city’s energy commission.

Wayne Appleyard at an April 2010 joint meeting of the city’s energy, environmental and planning commissions. Next to Appleyard is Bonnie Bona, who at that time chaired the planning commission. (Chronicle file photo.)

Appleyard’s nomination was put forward at the council’s Sept. 16 meeting, but his confirmation was not requested at the council’s following meeting on Oct. 7. Even though the nomination was not put forward at the Oct. 7 meeting, Mike Anglin (Ward 5) registered his concerns about the nomination of a non-city resident.

So the confirmation request is pending clarification of some concerns that Anglin and other councilmembers have raised about Appleyard’s status as a non-city resident and his long tenure on the commission – since 2002.

As a non-city resident, Appleyard’s confirmation needs seven votes, which it would likely not have received on Oct. 7 given the short-handed council that night. [Only eight out of 11 councilmembers attended.]

The seven-vote majority, instead of the typical six, is required by the city charter for non-city residents: [emphasis added]:

Section 12.2. Except as otherwise provided in this charter, a person is eligible to hold a City office if the person has been a registered elector of the City, or of territory annexed to the City or both, and, in the case of a Council Member, a resident of the ward from which elected, for at least one year immediately preceding election or appointment. This requirement may be waived as to appointive officers by resolution concurred in by not less than seven members of the Council.

Appleyard lives in Grass Lake, Mich. With respect to Appleyard’s long tenure, a city charter requirement on city boards and commissions has been analyzed as not applicable to the city’s energy commission. The charter requirement limits continuous service on some kinds of boards and commissions to six years, after which a three-year lapse is required:

Boards and Commissions SECTION 5.17.
(a) The Council may create citizen boards for each of the following departments: Police Department, Fire Department, Department of Public Works, Utilities Department, Department of Parks and Recreation, and Department of Building and Safety Engineering. It may, in addition, create such a board for any department established pursuant to this charter. The Council shall prescribe the number of persons on each such board, the terms of office, the method of appointment of members, the board officers and the method of their selection, and provisions concerning the holding of regular and special meetings. No person serving on such board continuously for six years shall be eligible to reappointment, until the lapse of three years. …

The city energy commission was established in 1985 by a council resolution to “oversee City policies and regulations in areas of energy efficiency concerns and make periodic public reports and recommendations to the City Council.” So it’s not analyzed as corresponding to any particular city department. Under special qualifications, the online Legistar description states: “wide spread representation; interest in energy.” Terms of appointment for energy commissioners are three years.

When Appleyard was up for reappointment in 2010, no objections were raised. On that occasion, mayor John Hieftje separated out Appleyard’s confirmation for a separate vote to ensure it was clear that he’d specifically received adequate support from the council, despite not being a city resident.

Appleyard is principal with Sunstructures Architects, with a focus in renewable energy and sustainable architecture. Appleyard designed the house of Stephen Kunselman (Ward 3).

City Energy Commission: Fossil Fuel Divestment

A resolution on divestment from fossil fuel companies is back in front of the council for the third time. When it was initially considered on Sept. 3, 2013, the council voted it down. But on Sept. 16, 2013 the resolution was brought back for reconsideration, then postponed until Oct. 21.

It’s based on an energy commission resolution passed on July 9, 2013. The resolution recommended that the city council urge the city’s employee retirement system board to cease new investments in fossil fuel companies and to divest current investments in fossil fuel companies within five years. The resolution defines a “fossil fuel company” to be any of the top 100 coal companies or top 100 gas and oil extraction companies.

The top three coal companies on the list are: Severstal JSC; Anglo American PLC; and BHP Billiton. The top three gas and oil companies on the list are: Lukoil Holdings; Exxon Mobil Corp.; and BP PLC. The basic consideration of the resolution is the importance of the role that greenhouse gas emissions play in global warming.

The resolution cites the city of Ann Arbor’s climate action plan, which has a goal of reducing greenhouse gas emissions by 25% by 2025 and 90% by 2050. The resolution warns that fossil fuel companies have enough fossil fuel reserves that, if burned, would release about 2,795 gigatons of CO2. That’s five times the amount that can be released without causing more than 2°C global warming, according to the resolution.

Nancy Walker, executive director of the city’s employee retirement system, has reviewed for the council at its meetings the implications of fossil fuel divestment on the retirement fund. Walker had told the council that moving to separately managed accounts from the system’s preferred strategy – of using co-mingled funds, mutual funds, and particularly indexed funds – would cost 30-40 basis points more in fees, independent of any difference in the return on investment.

Live updates from the meeting will appear starting here a few minutes before the scheduled meeting start time of 7 p.m.

6:42 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. City administrator Steve Powers has arrived. Responding to a Chronicle query, he indicates that bids on the old Y lot will not be reported out or discussed tonight – because Colliers is still analyzing the responses.

6:49 p.m. Several attendees are here for the Diwali proclamation. Sumi Kailasapathy (Ward 1) is wearing a sari for the occasion.

7:07 p.m. Thomas Partridge is using the time before the meeting to quiz Stephen Kunselman (Ward 3) about the DDA ordinance. And we’re off.

7:08 p.m. Pledge of allegiance, moment of silence and the roll call of council. Marcia Higgins (Ward 4) is absent. Christopher Taylor (Ward 3) is absent for roll call, but he’s here. Higgins’ absence will have implications for vote tallies.

7:12 p.m. Mike Anglin (Ward 5) wants the McWilliams reconsideration moved up on the agenda, right after the mayor’s communications. Chuck Warpehoski (Ward 5) points out that Higgins is absent and that one condition on the reconsideration was that all councilmembers be present for the reconsideration. Mayor John Hieftje says Higgins is on her way. Warpehoski ventures that he could re-open the agenda in case Higgins has not arrived when the council considers the item.

7:14 p.m. City administrator communications. City administrator Steve Powers reports on a “feel-good” story – 400 trick-or-treaters during the city’s trick-or-treating on the Huron River. Community services area administrator Sumedh Bahl introduces some guests from Thailand and China who have been visiting Ann Arbor.

7:14 p.m. Proclamations. The proclamation on the agenda tonight is for Diwali – a five-day Hindu festival, the “festival of lights.” It declares Nov. 3, 2013, as Diwali in Ann Arbor, Michigan.

7:23 p.m. Speakers are in turn explaining the religious and cultural significance of Diwali.

7:23 p.m. Higgins has just arrived.

7:25 p.m. Buddhism is now being explained. Previous speakers explained Jainism and Sikhism.

7:27 p.m. We’re now receiving a chanted blessing. The blessing earns applause from the audience.

7:29 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 speak on the topic of the contract with URS for the environmental review for the Ann Arbor Station project: Rita Mitchell, Nancy Shiffler, Clark Charnetski, and Jeff Hayner. One of the two alternate speaker slots is also filled with a speaker who wants to address the council on the topic of the URS contract – Drew Waller. [More background above on Ann Arbor Station].

Four people are also signed up to talk about the addition of Ypsilanti Township to the Ann Arbor Area Transportation Authority: Martha Valadez, Matt Vanauker, Marko Arizankoski, and Abishek Thiagaraj. Alternate speaker Emmanuel Jones is also signed up to talk about adding Ypsilanti Township to the AAATA. [More background on Ypsilanti Township membership in AAATA]

Ann Arbor energy commissioner Mike Shriberg is signed up to speak in support of the resolution urging the employee retirement system to divest from fossil fuels companies. This resolution is back in front of the council for the third time. When it was initially considered on Sept. 3, 2013 the council voted it down. But on Sept. 16, 2013 the resolution was brought back for reconsideration, then postponed until tonight. It’s based on an energy commission resolution passed on July 9, 2013 recommending that the city council urge the city’s employee retirement system board to cease new investments in fossil fuel companies and to divest current investments in fossil fuel companies within five years. [More background on fossil fuel divestment]

Tom Partridge is signed up to speak in favor of his Ward 5 city council write-in candidacy.

7:36 p.m. Tom Partridge introduces himself as an advocate for all members of the community, including the middle class. He’s here as a candidate for city council and asks voters in Ward 5 to write in his name when they vote. He calls for the ending of homelessness, more access to affordable transportation, and health care. He recalls the demonstration several years ago at city hall by the KKK, which he says mayor John Hieftje authorized. [Hieftje was not mayor at the time.] Partridge complains that the planned redesign of the city’s website doesn’t go far enough.

7:40 p.m. Rita Mitchell says the community has not yet agreed on whether the city should take responsibility for a new train station. She pegs the total amount of money invested in study of a site at $1.7 million. She questions whether URS can be an objective consultant given some work done in connection with previous Fuller Station and the connector study. Mitchell questions the amount of funding in the contract just for the public engagement process, which she thinks is too much, compared to the amount for the environmental assessment per se.

7:42 p.m. Martha Valadez is transit organizer for the Ecology Center and Partners for Transit. She says access to public transportation is crucial for her personally and for her community. She supports the urban core transit program. She supports the membership of Ypsilanti Township in the AAATA. It will give the township a chance to participate in future funding requests, not just participation in governance, she says.

7:44 p.m. Matt Vanauker introduces himself as a Ward 5 resident and high school classmate of Kunselman. He’s surprised that the council didn’t support the countywide initiative last year. He can’t imagine a reason why Ypsilanti Township would not be included as a member in the AAATA. He relies on public transportation to accomplish basic life functions, like grocery shopping and medical appointments.

7:46 p.m. Nancy Shiffler is chair of the Huron Valley Group of the Sierra Club. She thinks the public involvement component is a strength of the proposal. She’s looking forward to a well-publicized schedule. She cautions against self-selected participants in online surveys. Task 4 of the contract, she says, is problematic, because it could result in a categorical exclusion for an FRA requirement with respect to parkland – and exclusion that would come too early in the process.

7:49 p.m. Mike Shriberg is an energy commission member. He’s spoken to the council twice previously. He’s conveying some of the information in this document: [Divestment: Response from Energy Commission] He asks that the council not be fixated on the question of fees. He asks the council to focus on what can be done now – by focusing on the investments that are not in indexed funds.

7:53 p.m. Clark Charnetski recalls the 30-year history of the study of different sites of a new rail station. That was the era when the Amtrak station was still located within the building where the Gandy Dancer restaurant is currently located. He invites the council to think about rail transportation from the passenger’s point of view. He notes a number of assumptions that were in place 30 years ago that have not proven to be correct. He says that even with current levels of ridership, an improvement to the station is needed. Responding to the idea that the current location could be used to improve the station, he says that the study will examine that option.

7:56 p.m. Abishek Thiagaraj is a junior at UM in biomedical engineering, volunteering with Partners for Transit. He sees transit as a priority. The student perspective is that they’re grateful for the current service AAATA provides. He talks about the need to improve transportation services to off-campus locations. He talks about the ability to integrate students more completely into the community through public transportation.

7:59 p.m. Jeff Hayner is running for Ward 1 city council as an independent. He’s just come from the PTO launch council. He draws an analogy to the trust we have in educators and elected representatives. He thinks community engagement is the key – in improving schools as well as in local government. He calls the redesign of the city webpages that’s on the agenda tonight long overdue. He’s glad to see it – one of the tabs will be “Democracy in Ann Arbor.” He disagrees with Tom Partridge that it’s difficult to get to the website. On the train station contract, he says the public engagement component is very heavy, but wonders if that will be used to shape public opinion or to listen to it.

8:01 p.m. Drew Waller works at Michigan Theater. He’s excited about the prospect of Al McWilliams being appointed to the DDA. [A single hiss comes from the audience.] We should focus on what McWilliams can do for the community, he says.

8:01 p.m. Council communications. This is the first of three 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.

8:04 p.m. Sally Petersen (Ward 2) says she’s been meeting with constituents about a city ethics policy. She’s not sure there’s appetite for it, but is preparing a resolution for the next meeting to instruct the city attorney to provide training for public officials on Act 196 of 1973 and to the city administrator to provide information on the city’s website. She announces the re-launch of a customer satisfaction survey she conducted previously. The Huron High School tennis team has won a championship, that she’s reporting tonight at the council table.

8:12 p.m. Mike Anglin (Ward 5) expresses his appreciation for city administrator Steve Powers’ work. He’s seen Powers show up to community meetings, he says.

8:12 p.m. Margie Teall (Ward 4) give a shout-out to the Ann Arbor Housing Commission for a national level recognition. Jane Lumm (Ward 2) echoes Anglin’s remarks about Powers. She refers to a meeting on the Dhu Varren, Green, Nixon intersection as an example of his work. “Our taxes are well-invested,” said one resident, according to Lumm.

8:12 p.m. Stephen Kunselman (Ward 3) mentions an Oct. 30 meeting on a public improvement project in Springbrook subdivision, near his neighborhood. Chuck Warpehoski (Ward 5) thanks Sumi Kailasapathy (Ward 1) for bringing forward the Diwali proclamation. He also announces that he’s working with staff on an outdoor smoking ordinance that would mirror the county ordinance. He’s looking to empower the city administrator to designate some areas of parkland as non-smoking areas. He says at least playgrounds should be non-smoking. He’ll be asking the park advisory commission for input, as well.

He announces that he and Sabra Briere (Ward 1) are working on a framework to establish a pedestrian safety citizens advisory committee. He thinks the committee would be seated at the second council meeting in November. The effort is not designed to determine or preempt the outcome of the effort to repeal the pedestrian crosswalk ordinance.

8:16 p.m. Briere follows up on Warpehoski’s remarks by saying they want first to identify the broad categories of people or groups who might serve on such a pedestrian safety committee.

Christopher Taylor (Ward 3) announces that he’s working with Teall on a resolution asking that the University of Michigan decommission the large billboard outside Michigan football stadium on Stadium Boulevard. If it won’t be decommissioned, he says, the resolution will ask that the university operate the billboard only just before large events. Taylor also alerts the council to the recommendations of the park advisory commission‘s subcommittee on downtown parks. That will be on the next meeting’s agenda for formal acceptance, he says.

8:17 p.m. Nominations. Being nominated to fill the remaining vacancy on the Ann Arbor Downtown Development Authority board – due to the resignation of Nader Nassif – is Cyndi Clark, owner of Lily Grace. The business is described on its website as a luxury cosmetics boutique in downtown Ann Arbor.

To fill a vacancy left by Leigh Greden on the Ann Arbor housing commission board, Tim Colenback is being nominated tonight. Greden’s nomination had been made, but was never put forward for a confirmation vote. Colenback also serves on the city’s housing and human services advisory board. Colenback has told Hieftje that he can’t serve on both bodies.

A replacement for Julie Grand on the park advisory commission is being nominated tonight – David Santacroce. He’s a professor of law at the University of Michigan, and chaired the North Main Huron River corridor task force, which worked for a year and delivered its report recently to the council on recommendations to the corridor. Grand finished her term on PAC, completing her maximum two terms of service at PAC’s Oct. 15, 2013 meeting.

Amy Shepherd is being nominated to serve on the city’s commission on disability issues. On the energy commission, Shoshannah Lenski is nominated to replace Mike Delaney, and Mike Shriberg is being nominated for reappointment.

8:17 p.m. Appointments. On the agenda as of Friday, Oct. 18 was just one appointment – that of Wayne Appleyard to the city’s energy commission. Appleyard’s nomination was put forward at the council’s Sept. 16 meeting, but his confirmation was not requested at the council’s following meeting on Oct. 7 – pending clarification of some concerns that councilmembers have raised about Appleyard’s status as a non-city resident and his long tenure on the commission, since 2002. [More background on Appleyard appointment]

8:21 p.m. Mayor John Hieftje begins by saying he can’t imagine anyone who’s more knowledgeable or qualified to serve on the energy commission.

8:21 p.m. Sumi Kailasapathy (Ward 1) says Appleyard is highly qualified, and thanks him for his service. But local government is about local governance, she says. It’s not personal, she says, and she values his service. She thinks that among the 115,000 residents of Ann Arbor, other qualified commissioners could be found. If the energy commission recommends measures that could have an effect on the city’s financial well-being (like the fossil fuel divestment resolution), the recommendations should be made by people who will live with the consequences.

8:24 p.m. Jane Lumm (Ward 2) says Appleyard is abundantly qualified. But she’s concerned about the length of his service – as a non-city resident. Reasonable term limits are a good government practice. So Lumm and Kailasapathy won’t support the appointment. Mike Anglin (Ward 5) says that service in the community leads to more service in the community. There needs to be a kind of welcome mat put out to residents. Watching the energy commission, Anglin says, he thinks that residential solar and geothermal initiatives should have received more attention. Going outside the community shouldn’t be necessary, he concludes.

8:30 p.m. Sally Petersen (Ward 2) says it’s not Appleyard’s fault that there are no term limits. She’s going to support the appointment. She reminds the council that non-city resident Alison Stroud was unanimously approved by the council as an appointee to the city’s commission on disability issues, because of her unique qualifications.

Christopher Taylor (Ward 3) says he’s delighted to support Appleyard, who exemplifies excellence. Hieftje reiterates that Appleyard has tremendous expertise. Sabra Briere (Ward 1) points out that Appleyard also serves on the environmental commission as the energy commission’s representative. She says he represents a valuable background and voice that would be otherwise unrepresented. She calls his explanations cogent and patient. His style is non-aggressive but firm, she says. She supports his appointment. Hieftje points out that Appleyard is a taxpayer as a business owner.

Stephen Kunselman (Ward 3) recalls his relationship with Appleyard. Appleyard designed Kunselman’s house and Kunselman served on the energy commission back when Kunselman was the planning commission’s representative to that body. He says he’ll support Appleyard’s appointment.

8:31 p.m. Outcome: The council has voted 8-3 to approve the reappointment of Wayne Appleyard to the city energy commission. Dissenting were Lumm, Anglin and Kailasapathy.

8:31 p.m. Reconsider: Appointment of Al McWilliams to DDA (postponed from Oct. 7). The council’s vote on Al McWilliams’ appointment to the board of the Ann Arbor Downtown Development Authority was taken on Sept. 16, and was approved on a 6-5 vote in favor – but appears to have required eight votes under the council’s rules. That vote resulted in a procedural controversy. Late in the Oct. 7 meeting, Chuck Warpehoski (Ward 5) convinced his council colleagues to re-open the agenda to consider a motion to reconsider the Sept. 16 vote on McWilliams. Warpehoski could do that as someone who voted on the prevailing side. That motion for reconsideration was immediately postponed until tonight’s meeting.

The point of Warpehoski’s motion is unlikely to result in a change of any councilmember’s vote, but would serve to eliminate the procedural question about McWilliams’ appointment. Tonight, the first vote to be taken will be on the motion to reconsider. If at least six councilmembers vote to reconsider, then the question of the appointment itself will be in front of the council. [More background on Al McWilliams appointment]

8:32 p.m. Outcome: The council has voted 8-3 to reconsider the vote on McWilliams’ appointment. Voting against reconsideration were Hieftje, Taylor and Teall.

8:34 p.m. Anglin reviews the conflict of interest issue. He says that more important than that was the reaction some of the female councilmembers had had to the material on McWilliams’ website. McWilliams might be very talented, but Anglin feels that he erred in his judgment to post some of that material. It was a 6-5 vote, he says, adding that it’s the first time he’s opposed a mayoral nomination.

8:37 p.m. Lumm thanks Warpehoski for his action to reconsider the vote. She says it was honorable. She thanks city attorney Stephen Postema for writing the opinion that the council had requested. She’ll vote against the appointment. It’s not hard to find qualified applicants for the DDA board, she says. She wants someone who has the maturity to serve on the board. It’s an issue of judgment and respect, she says.

Taylor says he’ll support the nomination, noting that the council has received many communications from people who know McWilliams well in a professional context. Business leaders are universal in their support of him, he says.

8:41 p.m. Warpehoski reviews some of the objections: (1) conflict of interest; (2) misogyny; and (3) judgment. He thinks that (1) could be addressed with timely recusal. As far as the misogyny, he felt the material McWilliams had posted was a media critique, not an invitation to “Hey, check out this hottie!” He said he didn’t see any basis for the claim of misogyny. On (3) he echoes Taylor’s remarks.

8:46 p.m. Kunselman thanks Warpehoski for his effort. “The man insulted me,” Kunselman says. And for that reason he’ll be voting against McWilliams. Kunselman says he won’t repeat the insult because it wouldn’t be appropriate decorum. Kunselman says that “third-grade potty humor” is not appropriate for a public official. He cautions that someone else at the table could be the next person that McWilliams insults.

Kailasapathy says we all curse, but cursing with women’s body parts is unacceptable.

8:52 p.m. Teall says that she wishes the council wouldn’t spend time on this agenda item, but will “pipe up as well.” She says that someone who could bring great life to the DDA should be supported.

Petersen says she wasn’t planning on saying anything. The fact that the word “misogyny” is being used indicates that the appointment isn’t appropriate. She recalls her interaction with McWilliams on the phone. She’d told him he’d watered down his message with the images and the language. He’d told her he disagreed and said it was appropriate vernacular. The recommendations the council had received were from people she respected, she said, but they did not know about the conversation she’d had with him. At this point, she’s not ready to appoint him to the DDA. “We need the highest caliber people” on the DDA board, she says.

Lumm thanks Petersen. She says it’s a core demonstration of poor judgment to defame her colleagues in the way that McWilliams did.

8:52 p.m. Outcome: The council has again voted 6-5 to appoint McWilliams to the DDA board.

8:52 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. Four public hearings are scheduled. The first is on a change to the definition of sidewalks – the effect of which will allow sidewalk millage repair funds to be used to fix cross-lot walkways, but not trigger a winter maintenance requirement.

The second and third hearings are fairly straightforward rezoning issues – one involving an annexation into the city from an adjoining township and the other a rezoning from residential to public land (because the city acquired the land). The fourth public hearing is on site plan for U-Haul on South State Street.

8:53 p.m. PH: Sidewalk ordinance. No one speaks at this public hearing.

8:57 p.m. PH: Rezoning of Kocher property. Thomas Partridge says that items like this should have amendments attached requiring accessibility to public transportation and affordable housing.

8:57 p.m. PH: Rezoning of 3875 East Huron River Drive. No one speaks at this public hearing.

9:00 p.m. PH: U-Haul site plan. Thomas Partridge again calls for an amendment requiring access to public transportation on the site. He says the site plan should be referred back to the planning commission.

9:01 p.m. Minutes and 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 just two items. One is a contract with Keystone Media ($26,900) to redesign the basic templates for the city’s website. The other is the acceptance of the board of insurance review minutes from Sept. 19.

9:01 p.m. Councilmembers can opt to select out any items for separate consideration. No one does tonight.

9:01 p.m. Outcome: The council has now approved the consent agenda.

9:01 p.m. DDA ordinance. The ordinance revision (to Chapter 7) in front of the council for final approval tonight would clarify the existing language of the ordinance. The clarification would disallow the DDA’s preferred interpretation of a restriction on TIF (tax increment financing) revenue that’s expressed in the ordinance language. This ordinance revision was first considered by the council in February of this year. A joint committee of councilmembers and DDA board members has been meeting, most recently on Oct. 16, to develop a substitute proposal. But based on the Oct. 16 committee meeting, that won’t be ready for tonight’s meeting. The item is likely to be postponed. [More background on DDA TIF ordinance]

9:03 p.m. Kunselman reports that a joint committee meeting of DDA board members and councilmembers has not yet settled on the details of an alternative approach. Kunselman wants the ordinance postponed again until Nov. 7, so that the council can weigh the current proposal and the alternative that the committee puts forward.

9:04 p.m. Outcome: The council has voted unanimously to postpone the DDA ordinance changes until its Nov. 7 meeting. That’s the last council meeting before the new composition of council is seated, following the Nov. 5 election.

9:04 p.m. Sidewalk Ordinance. This ordinance change in front of the council for final approval would revise the definition of “sidewalk” so that cross-lot walkways could be repaired using sidewalk repair millage funds, but not trigger the ordinary winter maintenance requirement on adjacent property owners. The definition makes a walkway a “sidewalk” if the council formally accepts the walkway for public use; so the companion resolution accepts 34 specific cross-lot walkways for public use. [More background above on cross-lot paths]

9:05 p.m. Jane Lumm (Ward 2) thanks staff for their work.

9:05 p.m. Outcome: The council has voted unanimously to approve the change to the sidewalk ordinance.

9:05 p.m. Accept 34 sidewalks for public use. This is the companion resolution to the sidewalk ordinance change. The definition makes a walkway a “sidewalk” if the council formally accepts the walkway for public use; so the companion resolution accepts 34 cross-lot walkways for public use.

9:06 p.m. Lumm thanks staff for being responsive to concerns from specific neighborhoods.

9:06 p.m. Outcome: The council has voted unanimously to accept the 34 cross-lot walkways for public use.

9:06 p.m. Zoning: Kocher parcel. This is a typical rezoning after annexation from a township into the city. The 2925 Devonshire parcel is 0.66 acres and will be rezoned to R1A (single-family dwelling district).

9:06 p.m. Outcome: The council has voted unanimously to approve the zoning of the Kocher property.

9:06 p.m. Zoning: 3875 East Huron River Drive. The council is being asked to give final approval of a rezoning request for 3875 E. Huron River Drive from R1A (single-family dwelling) to PL (public land). The council had given initial approval of the rezoning at its Sept. 16, 2013 meeting. The site, which is adjacent to the city’s South Pond park, will be used as parkland.

Aerial view of 3875 E. Huron River Drive.

The property was acquired by the city in 2010, but a “life estate” was in place until earlier this year, according to a staff memo. The two-acre site – located on the north side of E. Huron River Drive and west of west of Thorn Oaks Drive – includes a single-family home. The land overlooks South Pond. City assessor records show that the property was previously owned by the Elizabeth Kaufman and Wes Vivian trust.

9:07 p.m. Jane Lumm (Ward 2) calls it a generous gift.

9:07 p.m. Outcome: The council has voted unanimously to approve the zoning of the 3875 East Huron property.

9:09 p.m. Recess. The council is now in recess. The next item up on the agenda is the Ypsilanti Township membership in the AAATA. Township clerk Karen Lovejoy Rowe and supervisor Brenda Stumbo were here previously, but it appears they have departed from the meeting.

9:20 p.m. And we’re back.

9:20 p.m. Admit Ypsilanti Township to AAATA. The council is being asked to approve revised articles of incorporation for the Ann Arbor Area Transportation Authority, so that Ypsilanti Township is admitted as a member of the authority. The board would be expanded from nine to 10 members. [More background on Ypsilanti Township membership in AAATA]

9:21 p.m. Brenda Stumbo is actually still here.

9:25 p.m. Stephen Kunselman (Ward 3) says it’s been over a year since he was out opposing the countywide initiative. But he’d told Stumbo at the time that he’d do whatever he could as a city councilmember to get Ypsilanti Township into the authority. He’ll support Ypsilanti Township as a member, he says, but it’s important to understand what the significance is. It’s a matter of governance, not of finances. However, if there are questions that still need to be answered, he’d be content to wait. Putting Ypsilanti Township at the table will bind the community together better, he says.

9:25 p.m. Jane Lumm (Ward 2) says she thinks it’s a bit premature to vote on it tonight, given that AAATA has just now started its public engagement campaign on the 5-year plan. She floats the idea of postponing until the second meeting in November. [That will be after the new composition of the council is seated, post-election.]

9:29 p.m. Michael Ford, CEO of the AAATA, is now at the podium. He notes that Ypsilanti Township leadership is here. [Both Stumbo and Lovejoy Rowe are still here.] Ford says that all that’s being asked is for Ypsilanti Township to be admitted as a member.

Stumbo says township residents support this move. She recalls her long career in public service in the township, joking that she started when she was 12. It’s a long-term financial commitment. Currently the route the township pays for is $340,000 annually, she says. It’s imperative that the township have transportation. “We need to lift people up,” she says, and the way to do that is to provide transportation. It will help with congestion in Ann Arbor. She’s proud to be there tonight and says that the township board supports the move.

9:32 p.m. Kailasapathy confirms with Ford that Ypsilanti Township currently has a purchase-of-service agreement (POSA). She said that although meetings were held in the township about this, she’s supposed to represent Ann Arbor. She characterizes this timetable as rushing it. Just because concerns weren’t raised when Ypsilanti city was added doesn’t mean that she can’t raise concerns now.

Ford responds by saying that it’s not being rushed, and that the AAATA had followed the Ann Arbor city council’s direction to work with the urban core to develop service, the financial structure, and governance.

9:33 p.m. Kailasapathy counters by saying that it’s not required that Ypsilanti Township be handled the same way as Ypsilanti city.

9:37 p.m. Petersen says that it just so happens that the 5-year service plan meetings are being scheduled over the next few weeks. Petersen said her understanding was that it would be a give-and-take exchange. The meetings are already set up. And her constituents have asked that the meetings be used to hear what everybody has to say. That would slide the schedule forward only four weeks, she says, until the middle of November.

Teall says that just because the meetings happen to be planned, they shouldn’t be used to divert the focus. She says the process has been exhaustive. It’s been years, she said. Ford notes that he’s met with individual councilmembers and it’s not a surprise. He points out that five of the councilmembers have participated in the urban core discussions.

9:42 p.m. Ford says that some of the questions posed by the councilmembers were received by the AAATA at noon today. Lumm says some of them weren’t answered. Ford and Lumm engaged in spirited back-and-forth. Lumm takes the position that admitting Ypsilanti Township into the AAATA is not a stand-alone decision.

Ford reviews the point of the 5-year service plan meetings – to go over the service improvements. Lumm says she’s trying to weigh the cost-benefit of a possible 0.7 mill tax. It’s difficult to assess it without more information. Hieftje says he doesn’t see how the funding mechanism affects the decision tonight. Admitting Ypsilanti Township is something that should have happened 30 years ago. Anyone who was paying attention to transportation issues would have known this was coming, he says. Any funding decision would need to be approved by voters. Ann Arbor needs to work with communities around it, to realize its great promise as a city, Hieftje says.

9:46 p.m. Briere says the question is to allow Ypsilanti Township a seat at the table. Briere asks Stumbo what she sees as a benefit to membership. Stumbo talks about the Washtenaw connection, and the long-term commitment as benefits. Instead of a year-to-year POSA agreement, there would be a longer-term agreement. She says she’s trying not to take it personally, but she can’t understand why the council wouldn’t vote to allow Ypsilanti Township to join the AAATA.

9:49 p.m. Briere asks Ford if residents will be presented with a menu of improvements and their costs so that residents can choose what services they’d like. Ford described it as a very engaged process that would include adjustments based on what people say at the engagement meetings. Briere asks when the dollar amounts will be broken down for each element of the service improvement plan. Ford says that about a month after the meetings are concluded, those exact costs will be available.

9:53 p.m. Kunselman reiterates that he’s committed to Ypsilanti Township having a seat at the table. That seat at the table does nothing to change the financing, he says. The city of Ann Arbor will still have eight out of 10 seats, which can control the board. He says that transportation services would only be “given away” to Ypsilanti Township if Ann Arbor’s own representatives on the AAATA board approved it. A discussion about the finances isn’t the one the council should be having right now. That’s possibly even a year away, he says. [That means Kunselman is thinking a May 2014 millage vote is probably too soon.]

Kunselman said he’d been against the countywide transportation authority initiative based on the board composition [8 out of 15 board seats on that now-demised proposal]. He didn’t think the council needed to worry about board control. It’s just approving a seat at the table so the township can have a voice, he says.

9:56 p.m. Warpehoski starts by saying that he was wrong earlier – when the council had decided to “bail” on the countywide proposal, he’d been angry and allowed that he might have said some things about Kunselman that might have been insulting. He now took it very seriously when Kunselman says that Ypsilanti Township should have a seat on the table. It’s important to be a good regional partner, Warpehoski says.

On the finances, Warpehoski says it’s a chicken-and-egg problem. To get a solid financial foundation, you need a solid governance structure, he said. The step of finalizing governance needs to be taken before establishing the funding and service plan.

10:00 p.m. Warpehoski asks under the various permutations of Ypsilanti Township being in or out, or whether the millage passes or not: Is there any threat to Ann Arbor services? No, says Ford. What’s the mechanism for funding Ypsilanti Township service as a member of AAATA if the millage doesn’t pass? Stumbo says it’d be paid for out of the township general fund. Ford explains that a similar arrangement to the one the city of Ypsilanti had recently made would also be made with the township.

10:03 p.m. Taylor says it’s a pretty simple process. After the countywide transportation initiative was turned down, the council had said to the AATA: Go away and come back with an urban core plan. Now the question is whether the council meant what the council said back then. Taylor is now ticking through the general benefits of public transportation – congestion reduction and economic development.

Kailasapathy is asking Stumbo and Ford questions. She wants a copy of the MOU (memorandum of understanding) for the township. Ford says that the MOU will follow the membership. Kailasapathy wants it now. She references Taylor’s comments about the urban core – saying that the council had not given the AAATA a blank check.

10:06 p.m. Anglin calls Ford one of the most patient people he knows. He says the strong minority has asked for something specific, a strong minority that could put the AAATA over the top someday. Some councilmembers are asking for more time to answer questions of their constituents. Ann Arbor residents have paid the millage for many years, so if some councilmembers want some more time, they should be listened to.

Ford says that everyone is hung up on the idea of the millage. The AAATA had done what the council had asked it to do and that’s what this is about, Ford said.

10:10 p.m. Higgins says that the discussion is about whether the board should be expanded, and that’s what residents want to weigh in on. People get very concerned without giving them a chance to provide input. On the question of expanding the board, people should have a chance to weigh in on that, she says – during the meetings the AAATA has scheduled over the next few weeks. Higgins is not against having residents have a say.

Ford says that this is the same process used with the city of Ypsilanti. Higgins shuts down Ford saying, “I didn’t ask you a question.” Higgins moves for postponement.

10:12 p.m. Teall says she’ll oppose postponement. Warpehoski asks Ford what the impact of a postponement would be. Ford says the AAATA has been at this a long time. Treating the township differently from the city of Ypsilanti is a problem, he says. It’s not the first time the AATAA has talked with the council about it, he notes. Ford says it would slow the process down and not send a good message.

10:17 p.m. Hieftje says that Ypsilanti Township has been a “good citizen” for many years. He says he doesn’t understand why the city of Ypsilanti should “breeze through” and then there’d be a pause with the township. Briere picks up on a concern expressed by Teall – that the meetings scheduled for the next few weeks would re-focus from the 5-year service plan to the expansion of the board. Ford says that it would put the AAATA behind on making any improvements to service. Briere asks how many meetings. Thirteen, says Ford, running through Nov. 14.

Briere ventures that Lumm wants dollar amounts attached to each improvement, to be able to choose Chinese-menu style. Briere asks Ford if that information can be assembled in mid-November. Ford says that it’ll take about a month after the meetings conclude.

AAATA legal counsel Jerry Lax has joined Stumbo and Ford at the podium, but he hasn’t spoken yet.

10:27 p.m. Briere ventures that without membership on the board, Ypsilanti Township will continue with its year-to-year POSA. She asks if it will be possible to have productive conversations at the scheduled public meetings without the governance question settled. Lax says Ypsilanti Township is prepared to make the longer-term POSA commitment, if it has a seat at the table. Lax says that if the township did not commit to a longer-term arrangement, the AAATA would still have leverage in the negotiation of the year-to-year POSA.

Lumm disagrees with Ford that it’s inappropriate to treat the city and the township differently – citing the city’s dedicated millage versus the township’s POSA. Lumm says it sets a bad precedent that to be eligible for membership in the AAATA, all you need is a POSA. She wants to see the long-term MOU. [Lax has basically explained earlier that the willingness on Ypsilanti Township's part to enter into the long-term MOU is based on having a seat at the table.]

Lumm says that with so many unanswered questions, she thinks it’s important to postpone. Ford asks to respond. Hieftje says no. Teall makes some remarks and gives Ford the floor. Ford reiterates that the issue before the council is governance – that is, adding Ypsilanti Township to the board. He adds: “The rest is noise.” Petersen says that governance and funding are inextricable linked. Petersen says that based on constituent feedback, the two issues are co-mingled. By delaying now, she says, a millage would have a better chance of passing.

10:31 p.m. Kailasapathy still wants to see the MOU before voting to add Ypsilanti Township as member. Hieftje wants to move to a vote on the postponement. Ypsilanti Township has more to risk, Hieftje says. He says that it should have been done 30 years ago.

Stumbo says that the township doesn’t have a ward system – they’re elected at large. So she understands the conversation around the table. She points to the geography of the township, which surrounds the city of Ypsilanti.

10:33 p.m. Warpehoski says he’d vote for it today or a month from now. Kunselman’s 8-2 odds for the city are pretty good, he says. But he’ll vote for postponement because he wants the final vote to have as much support as possible. He doesn’t want it to pass with a 6-5 vote. He wants a solid majority.

10:36 p.m. Kunselman says he started out saying he had unwavering support for adding Ypsilanti Township, but was open to postponement. He tells Stumbo that he’s still committed to getting it done. He’ll support the postponement. “When we get back here, I look to have everybody here unanimously supporting this,” he says. If it’s not that kind of support, a millage won’t pass. He says he’ll attend the scheduled meetings and make clear why it’s important to add Ypsilanti Township to the board. It’s important to re-build trust, he says. “Government is messy,” Kunselman says. He adds that he had almost been ready to go for the vote tonight, but now felt it was important to take the time to build trust.

10:37 p.m. Outcome: The council has voted 8-3 to postpone the revised articles of incorporation for the AAATA admitting Ypsilanti Township as a member. The item is postponed until the council’s second meeting in November. That’s after the new composition of the council is seated. Dissenting were Hieftje, Taylor and Teall.

10:37 p.m. Recess. We’re again in recess.

10:49 p.m. And we’re back.

10:49 p.m. Fossil fuel divestment resolution. This resolution is back in front of the council for the third time. When it was initially considered on Sept. 3, 2013, the council voted it down. But on Sept. 16, 2013 the resolution was brought back for reconsideration, then postponed until tonight. It’s based on an energy commission resolution passed on July 9, 2013 recommending that the city council urge the city’s employee retirement system board to cease new investments in fossil fuel companies and to divest current investments in fossil fuel companies within five years. [More background on fossil fuel divestment]

10:50 p.m. Hieftje says he hopes the discussion can be brief, because it’s already been discussed a lot.

10:55 p.m. Taylor says that his impression is that the council is eager to express its support for divestment but concerned about interfering with the pension board. An earlier amendment had been made to try to address that tension. He’d be more comfortable with a set of requests to investigate and consider various topics.

Petersen says it makes sense to remove language that has to do with divestment. She would be more inclined to support something that is more proactive about directing investment in clean energy instead of divesting from anything.

Hieftje says that the resolution as it reads doesn’t have any “teeth” that would direct the pension board to do anything. It would send a message, however, that the city wants to align its investment strategy with its sustainability plan. He ventured it could be watered down further by saying, “maybe please could you possibly do something.” But the resolution is already soft enough as it is. He felt the council should give this an up or down vote and ask the energy commission to come up with something else.

10:59 p.m. Kunselman says it does need to be watered down further. He doesn’t want to urge another body to do something over which the council has no control. Some of the other cities that have been referenced as having a similar policy simply had mayoral directives, he says. Kunselman says it should just be very simple. The list of things that are in the resolution aren’t “neighborly,” he says.

Taylor now offers a set of amendments that he says he’s sending around by email and to the clerk.

11:01 p.m. Taylor says that “urges” will be replaced with “requests” throughout. Also the first resolved clause deletes the word “immediately.” Another piece of language from Taylor’s amendments: “… to investigate whether it can reasonably divest …” The phrase “consider ensuring” is used instead of just “ensuring.”

11:02 p.m. Taylor’s amendments are approved, with dissent from Hieftje.

11:09 p.m. Warpehoski says he’ll support the resolution. Lumm says she supports the elimination of the word “urge” and the substitution of “request.” She doesn’t know what this resolution will accomplish, however. She thanks the retirement board for its work. She points to the fees that would be incurred as a result of withdrawing investments from indexed funds.

Briere says that she can’t match Lumm’s rhetoric when it comes to investments because it’s not in her skill set. She relies on other people to guide her. There’s a concern that the staff of the pension board might not be able to distinguish between looking into things versus implementing something. Taylor’s amendments, she says, are reasonable. They provide guidance without imposing restriction.

11:12 p.m. Teall indicates she’ll support the amended resolution. Petersen says the amendments do water down the resolution, and she doesn’t want to support something that doesn’t have teeth. The council would be asking the pension board to take its eye off the ball for a while. A resolution about investment as opposed to divestment would have teeth, she says.

11:18 p.m. Kunselman wants to make sure that the title of the resolution has “urges” replaced with “requests,” along with the body of the resolution. Kunselman says he’ll support the resolution, but makes some remarks on what he wants the energy commission to focus its efforts on – energy efficiency projects, not investment strategy. Kunselman ventures that some members of the pension board are present.

City administrator Steve Powers gives some brief background, and CFO Tom Crawford takes the podium. The pension board had taken the council’s questions and deliberations seriously, Crawford says. The time it would take the board’s investment committee was a concern, he says. The volunteer board has a professional investment advisor, and the advice has been that there’s no way to very simply address the issue. Hieftje wants to move to a vote.

11:19 p.m. Outcome: The council has voted to approve the amended fossil fuel resolution on a 9-2 vote. Dissenting were Petersen and Lumm.

11:21 p.m. Resolution to accept donation of property at 3013 W. Huron River Drive. This resolution accepts and appropriates foundation funds to the parks for upkeep and maintenance of 3013 W. Huron River Drive as parkland.

11:22 p.m. Briere and Teall make remarks in support. Kunselman adds a lighthearted remark about a junior high classmate.

11:22 p.m. Outcome: The council has voted to approve the donation.

11:22 p.m. Resolution recognizing Skyline Athletic Booster Club as a civic nonprofit organization. The purpose of the recognition is for the booster club to obtain a charitable gaming license. The booster club is hosting the Millionaire Party (a poker tournament) on eight occasions: Nov. 1, 2, 3 and 4, as well as Dec. 7, 8, 9 and 10.

11:22 p.m. Outcome: The council has voted to recognize the Skyline Athletic Booster Club as a civic nonprofit organization.

11:22 p.m. Site Plan: U-Haul Moving and Storage The city planning commission recommended approving the site plan for the U-Haul expansion at its Sept. 10, 2013 meeting. The U-Haul business is located at 3655 S. State St., south of the I-94 interchange.

Aerial view of U-Haul site on South State Street, indicated with crosshatches.

The project calls for building a 1,246-square-foot addition to the front of the existing retail building. The expansion includes a new 4,994-square-foot, one-story warehouse and an 11,696-square-foot, one-story self-storage building. Both of the new buildings would be at the rear of the site and not visible from South State Street. The project is estimated to cost $1.2 million.

This site is part of the area covered in the South State Street corridor plan, which the planning commission voted to add to the city’s master plan at its May 21, 2013 meeting. That plan calls for office uses at that U-Haul location in the future.

11:22 p.m. Outcome: The council has voted to approve the U-Haul site plan.

11:23 p.m. 81 street light poles for Main Street. The light poles would be purchased from Spring City Electrical Manufacturing at a cost of $173,307, with additional costs for installation and labor bringing the total cost to $280,000. The $280,000 still needs to be allocated from the general fund to the field operation’s unit FY 2014 street lighting budget.

As a budget amendment, the resolution needs eight votes under the city charter. It might not achieve that number, because of the ongoing political wrangling between the Ann Arbor Downtown Development Authority and the city council. [More background on Main Street light poles]

11:26 p.m. Briere leads off. She asks Craig Hupy to the podium. He’s the city’s public service area administrator. She wants to know when they were installed and by whom. Hupy says that they were installed by the DDA in the late 1980s, so the poles are not quite 30 years old. They weren’t noticed to be rusting because their decorative base shields the rust from view. He says the bases might have contributed to water not draining away. The new light poles would have a gap between the pole and the base, he explains.

11:31 p.m. Kunselman asks why the appropriation was not included in the budget. Hupy says that at that time, the DDA was proposing to cover the entire cost. Kunselman won’t support this resolution.

Lumm points out that the council’s budget resolution was to spend at least $300,000. She asks DDA executive director Susan Pollay if the DDA had considered making a greater contribution. Pollay reviews the history of the council’s budget resolution. Lumm inquires about the council resolution requesting the DDA to fund downtown police officers. Pollay says the DDA is looking at ambassadors, not police officers. She notes that some DDA board members will be traveling to Grand Rapids to learn more about that city’s ambassador program.

Kailasapathy asks where the $300,000 came from that the DDA had granted to Washtenaw County for its Annex renovation.

11:32 p.m. “C’mon, we knew this was coming,” Warpehoski says. Hieftje says he remembers it the same way as Warpehoski. Petersen asks if there is other money besides general fund money that could be used. No, says Hupy.

11:34 p.m. Kunselman presses Hupy on the question of the appropriation of the funds. The DDA had said that the DDA would step up and cover the expense. It was not in the city’s budget after discussion with the DDA. Kunselman says that the council had not made a commitment to pay for the light poles. The DDA had spent money for other things, like the Washtenaw County Annex building.

11:37 p.m. Taylor says that Kunselman has made a “flat-out misrepresentation” of what had happened. The council had been told that the council would need to spend the general fund money to do it. It was the council’s ill-advised interference with the DDA’s budget earlier in the year that has caused this situation, Taylor says. The council had made the budget adjustments in May, “knowing full well that we’d be on the hook for the balance.” He calls this a “self-inflicted wound.”

11:44 p.m. Briere says she appreciates what Taylor and Kunselman both said. Briere is now telling the council how she explained the difference between the city and the DDA’s budget to a constituent. Briere says that the city council had told the DDA how to spend its money, and the DDA has done that. She was filled with regret that the council had done that. When the DDA said it would step up and make that investment, she’d been relieved.

Petersen asks what the level of risk is for the light poles falling down. What kind of health and safety risk is posed? Hupy says those that were in immediate danger have been removed. If the light poles were not all going to be replaced in the near term, the city would go out and replace a few more poles, he says. Petersen says that she sees the DDA and the city’s budgets as “fungible.” She would like to see the DDA to find the money to complete this project. The DDA would not be funding police, she noted. She didn’t regret giving direction. She says that she thinks the DDA should find the money.

11:48 p.m. Lumm says that the allocation resolution is consistent with the council’s earlier budget resolution, so she’ll support it. Warpehoski asks if the overall cost of replacement changes, if the poles are replaced in stages as compared to doing it all in one phase. Hupy says that labor costs would go up. There would also be a mismatch between the globes.

11:48 p.m. Kailasapathy relates a vignette about a neighborhood where there’s no streetlight and no sidewalk – and a meeting that the city staff and she had attended about it. She had no regrets about changing the DDA’s budget earlier in the year to allocate $300,000 for affordable housing.

11:49 p.m. Outcome: The council has rejected the resolution on a 7-4 vote. It failed because it needed 8 votes to pass on the 11-member council. Voting against the resolution were Kailasapathy, Petersen, Kunselman and Anglin.

11:49 p.m. Ann Arbor Station. The request in front of the council is to approve a contract with URS Corp. Inc. (URS) for the Ann Arbor Station project environmental review. The total budgeted for the Ann Arbor Station contract on tonight’s agenda – which will cover public engagement, site selection and conceptual design – is $824,875, an amount that includes a $63,083 contingency. The city would pay 20% of that, or about $165,000. A Federal Rail Authority grant awarded to the city will cover the remaining $660,000. [More background on Ann Arbor Station]

11:50 p.m. Kunselman wants city transportation program manager Eli Cooper to clarify how much of the contract would use city funds. Cooper says it’s about $165,000. Kunselman notes that the money has been appropriated and does not presuppose a particular site. He’s going to support the contract.

11:57 p.m. Kailasapathy wants to know who decides the location of the site. Cooper notes that public commenters had pointed out that a third of the contract was for public engagement. The council could participate in the process, he says. Kailasapathy asks if there would be one preferred site at the end. Cooper says that as the sites are winnowed down, the criteria to be used would also be subject to public review and input.

Briere notes that most of the suggested sites are in Ward 1. She confirms that the goal of a previous process was to present the federal government with a preferred site. Cooper indicates that she’s right – it’s a requirement of the NEPA project. The emphasis on the previous project was based on the intermodal character of that facility. How does this proposal differ from that [Fuller Road Station] proposal? Cooper says that one difference is that there’s no initially preferred alternative for the location.

12:00 a.m. Briere asks: What is an environmental assessment? Cooper says it’s an analysis of the direct, indirect and cumulative effect of human action. It’s a qualitative descriptor about the impact of a project. That contrasts with an environmental impact statement, which is quantitative.

12:03 a.m. Lumm says she hasn’t heard Cooper say the word “parkland.” Cooper says that any project on parkland would not be eligible for categorical exclusion. If the preferred site were parkland, then it would be subject to Section 4F review, Cooper says. Lumm asks for confirmation that as a part of the process, it would be possible to see the “arc” of the selection process.

12:06 a.m. Cooper says that the public engagement process is not meant to tell people what the plan already is – he’s reacting to concerns expressed during public commentary. Lumm asks who Cooper sees as the stakeholders? Cooper says that will be clearer after the project kickoff. Power Marketing Research will be doing the public engagement. Cooper allows that some of the stakeholders will be the usual suspects. Stakeholders are only one part of the public engagement process, he says. There will be site tours to “walk the ground together,” he says.

12:08 a.m. Cooper notes that the no-build alternative is required to be included in the set of alternatives. The intent is to do this in an open and transparent and participatory process, he says. Lumm tells Cooper some people have zero confidence that the outcome has not been determined to be Fuller Road. She says the existing site is a “sweet spot” in terms of engineering.

12:09 a.m. Thomas Partridge asks, “Does anybody know what time it is?” Briere points out the clock on the wall. It’s 12:08.

12:11 a.m. Kailasapathy asks what she should tell residents who wonder why the city should build a new station for Amtrak. Cooper explains that Amtrak’s focus is on the operations – the trains themselves. It’s a discretionary decision, he allows. The idea is to meet the needs of residents and businesses to provide the kind of transportation facility they’d expect arriving in Ann Arbor.

12:14 a.m. Anglin says he’s happy to see that this project seems different from the previous approach. He says it seems like this process will actually consider alternate locations besides the Fuller Road site. He calls for all the public process meetings to be videotaped. Some of the previous money that’s been spent was “foolishness,” he says. He’ll vote to support this. The public is tired of bad dialogue, he says. Cooper responds by saying they’ll do their best to facilitate good dialogue.

12:16 a.m. Kunselman poses a hypothetical: If the site across the track, owned by Amtrak, is the preferred site, how would that work? Cooper explains that the federal dollars would come from the FRA. If the Amtrak property were the preferred location, there would be MOUs and legal instruments to bind the parties together.

12:17 a.m. Clark Charnetski from the audience explains that Amtrak owns the parking lot. The place where the tracks had been and were removed are now owned by MDOT. Amtrak owns the station, the property on which it sits and the metered parking lot, he says.

12:21 a.m. Lumm says that there’s no guarantee there’ll be federal money for eventual construction of a train station. She says there’s no demonstrated need for a new train station. She’d reviewed the contract for the study. It’s an important study the community cares about, she says. It’s important that there be substantial public engagement. She’s now ticking through the elements of the public engagement process. She says it’s important to consider the existing site or doing nothing at all. Given that those two primary concerns are addressed, she’ll support it, even though she calls it a “tough” decision.

12:27 a.m. Taylor says that improvement to the train station is deeply important. He points to improvements in Amtrak service and possible commuter service – with railcars having been purchased. It won’t happen tomorrow, but it’s important to plan for the future, he says. He calls the sewer reconstruction done at the Fuller Road site – which was in the city’s capital improvement plan (CIP) – as something necessary anyway. To suggest that it wasn’t necessary is “flat-out false,” he says.

12:27 a.m. Hieftje picks up on Taylor’s defense of the sewer work. It’s important not to create myths, he says. He says he’s pleased to see planning for a new rail station moving forward, whatever the location. He notes that the governor and MDOT are very interested in commuter rail. It would only be funded through the regional transit authority (RTA), Hieftje says.

12:32 a.m. Briere also adds her comments on the sewer work that was done at the Fuller Road site. She reviews the reasons that she voted to support that work. She says that part of the issue was the fact that the line runs under the river. If a sewer line were under the river, it would be difficult to notice if there were a problem. It was not the case that the only reason for the sewer work was to allow for the foundations of the demised Fuller Road Station to be put in, she says.

12:33 a.m. Outcome: The council has voted unanimously to approve the URS contract.

12:33 a.m. Purchase of ice control salt ($245,143). The request is for the purchase of bulk salt, for ice control, and seasonal back-up supplies to be purchased from the Detroit Salt Company for $245,143 (2,800 tons of “early fill” at $34.50 a ton, and 4,100 tons of “seasonal backup” at $36.23 a ton).

12:34 a.m. Outcome: The council has voted to approve the ice control salt purchase.

12:34 a.m. Fire department mutual aid box alarm system (MABAS) Division. The resolution authorizes the city administrator to enter into the required Act 7 (interlocal) agreements necessary to establish the city of Ann Arbor Fire MABAS Division and appoint Ann Arbor’s fire chief as a representative to the MABAS executive board. According to the staff memo accompanying the resolution, participation in MABAS would not replace any of the existing mutual aid agreements the city of Ann Arbor has. A MABAS approach to response by multiple jurisdictions defines a standard response package of equipment and personnel, which is automatically dispatched to a fire. That contrasts with the mutual aid approach, in which additional resources can be called if they’re deemed necessary once the initially-responding units have assessed the situation.

12:34 a.m. Outcome: The council has voted to approve participation in MABAS.

12:36 a.m. Council communications. Briere recalls the 1996 visit by the KKK. She was a member of the ACLU team who worked to ensure that the peace was kept. Hieftje had not been mayor on that occasion, she said. She was referring to Thomas Partridge’s public commentary. Lumm says that she was a councilmember at the time and the KKK was definitely not invited to come to Ann Arbor.

12:43 a.m. Lumm says that she’s consulted with the city attorney to bring forward a resolution on term limits to be applied in the city charter.

Warpehoski says that Ypsilanti Township has done a tremendous amount of work. When he counts the votes around the table, he thinks there will be six votes in a month, but wants to work toward unanimity. He says that “relationships are important,” and he fears that by postponing the Ypsilanti Township vote, the council was not perceived by the township leadership as working well with its regional partners. He suggests that councilmembers reach out to the township and give the relationship a personal touch. The relationship was hurt tonight, he says, and he’d been a part of that, so he apologized. Kunselman added his support to Warpehoski’s remarks.

12:45 a.m. Public Commentary. There’s no requirement to sign up in advance for this slot for public commentary.

12:45 a.m. Thomas Partridge is holding forth. He complains about the locations where meetings of some boards and commissions are held. He asks the voters of Ward 5 for their support in his effort to win election to the council as a write-in candidate. He complains that the AAATA bus system is not adequate, yet the council is talking about the right location for a train station.

Clark Charnetski recalls how he first arrived in Ann Arbor 53 years ago on the New York Central and got off at what is now the Gandy Dancer. He thanks the council for their vote on the Ann Arbor Station study.

Kai Petainen takes the podium to thank the council for its vote on the Ann Arbor Station study. It’s the public engagement portion of the contract he supports. He says he’ll complain if the preferred location turns out to be Fuller Road Station. In a nod to his Canadian roots, Petainen notes that Winter Classic tickets go on sale soon.

Michael Benson takes the podium on behalf of the graduate student government at the University of Michigan. He announces a forum on the city’s leasing ordinance, on Wednesday, Oct. 30 at 6:30 p.m. in the fourth floor auditorium of the Rackham Building.

12:52 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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From left: city administrator Steve Powers and Mike Anglin (Ward 5). (Photos by the writer.)

One of those late agenda additions was a confirmation vote of Al McWilliams’ appointment to the Ann Arbor Downtown Development Authority (DDA) board. The vote tally was 6-5, which was declared sufficient for confirmation. However, the city attorney is still reviewing the possibility that the confirmation required an eight-vote majority, under the council’s rules.

The debate on that item came late in the meeting, because that’s where nominations and appointments are slotted on the agenda template, based on the council’s current rules. But that will change in the future – due to a change in the council’s rules that was also on the Sept. 16 agenda. The council adopted some revisions to the rules that were three months in the works. Those included: adding an opportunity for public commentary to work sessions; changing the order of the agenda to move nominations and appointments for boards and commissions to a slot toward the start in the meeting; and prohibiting the use of personal electronic communications devices while at the council table.

Also related to the DDA on the Sept. 16 council agenda was the final approval of revisions to the city ordinance regulating the DDA’s tax increment finance (TIF) capture. The council again put off a vote on the question, which was given initial approval five and a half months ago – on April 1. The question was put off this time until Oct. 21.

The initially-approved amendments to Chapter 7 of the city code include various changes to governance, including term limits for board members, as well as clarifications to the existing language on TIF capture. The initially-approved amendments would enforce the existing language of the ordinance in a manner that would impact the DDA’s TIF revenue in a way roughly matching the DDA’s projected revenues in its 10-year planning document.

At the council’s Sept. 16 meeting, Stephen Kunselman (Ward 3) sketched out a different conceptual approach to the way the TIF capture is constrained. It’s an approach being developed by a joint committee of councilmembers and DDA board members as a “dual track” to the ordinance revisions currently under consideration.

Under the existing ordinance language, the amount of DDA TIF capture is calibrated to projections in the DDA TIF plan, which is a foundational document for the DDA. The different conceptual approach would establish a basis level for the maximum captured taxable value in the DDA district – a “cap” on TIF revenue – and then set some clearly defined annual increase, keyed to a specific percentage or some variant of a consumer price index (CPI).

A working document used by the joint committee at its Sept. 10 meeting showed two basic scenarios, one of which could roughly mimic the TIF revenue levels that would be provided under the current proposal, while the other might not provide any practical cap.

The second item added to the Sept. 16 agenda on the same day as the meeting was reconsideration of a vote on fossil fuel divestment taken by the council at its previous meeting, on Sept. 3. At that meeting, the council had voted 5-4 on a resolution calling on its employee retirement system to divest from fossil fuel companies. That tally defeated the resolution because it failed to achieve the necessary six votes on the 11-member council.

However, Margie Teall (Ward 4) voted with the prevailing side – one of the votes against it – giving her the right to bring a motion for reconsideration, which the council passed at its Sept. 16 meeting. But on the fossil fuel divestment resolution itself, after about 45 minutes of debate, the council voted to postpone the matter – until its Oct. 21 meeting.

In other business, the council approved the site plan for an expansion of a Honda testing facility, north of Ellsworth on Research Park Drive. The council also approved the rental of 8 extra trucks to supplement the city’s fleet during fall leaf collection season, at a cost of $117,200. It’s an annual expenditure.

Also on Sept. 16, the council formally accepted the final report of the North Main Huron River corridor task force.

The council also heard an update from Ann Arbor police chief John Seto on the preliminary assessment of newly implemented street closures for University of Michigan home football games. That preliminary assessment did not include any major problems, but Seto indicated that he wouldn’t draw conclusions until after a community meeting that’s being held to get additional feedback. That meeting takes place on Tuesday, Sept. 24 at 6 p.m. at Pioneer High School.

DDA Board Nomination: Al McWilliams

The council was asked to vote on the confirmation of Al McWilliams to the Ann Arbor Downtown Development Authority board. Although the item was not included on the agenda until the evening of the meeting, mayor John Hieftje told the council early in the meeting on Sept. 16 that he’d be asking for a vote on McWilliams’ appointment that night.

The action came after McWilliams’ nomination had been withdrawn by Hieftje in the middle of deliberations at the council’s previous meeting, on Sept 3, 2013. At that meeting, a positive outcome on the vote appeared to be in doubt, as two councilmembers were absent – Jane Lumm (Ward 2) and Marcia Higgins (Ward 4).

At that Sept. 3 session, councilmembers who were opposed to the nomination expressed a concern about a potential conflict of interest for McWilliams in votes he might take on DDA funding for the Ann Arbor Area Transportation Authority’s getDowntown program. His firm, Quack!Media, is an ad agency located in downtown Ann Arbor. Quack!Media lists the Ann Arbor Area Transportation Authority on its website as one of its clients.

DDA Board Nomination: Al McWilliams – Council Deliberations

Hieftje led off deliberations by saying that younger professionals are under-represented on city boards and commissions. He noted that McWilliams is supported by the director of the Main Street Area Association [Maura Thomson]. He wanted someone to replace Newcombe Clark in representing the Main Street area of downtown.

Sally Petersen (Ward 2).

Stephen Kunselman (Ward 3) said he wouldn’t be voting for McWilliams. He reported that he’d met with McWilliams and described him as “not ready for prime time.” Kunselman said he wouldn’t belabor the insults that McWilliams uses in Tweets, and the foul language in his blog posts. But you wouldn’t want your mother reading those posts, he said. Kunselman contended that McWilliams is not mature enough to serve on the DDA board – and what’s needed is someone who can show some tact. Kunselman allowed that McWilliams in his online work was coming at it as “joking” and that’s all well and good. But as a public official, that doesn’t work, he said.

Sally Petersen (Ward 2) agreed with Kunselman. She said she was looking at McWilliams’ website, and that there was a “very curious picture of Miley Cyrus’ rear end.” She reported that she’d had a conversation with him about his website, because she’d found some of the images somewhat offensive. She also cited McWilliams’ use of profanity as one objection, characterizing it as not professional. She held the DDA board to higher standards than that, she said. He belongs to the category of a “young, techie entrepreneurial person,” she said, but there are a lot of them out there and the city could do better in selecting them. She didn’t think McWilliams was the right person for the DDA.

Sumi Kailasapathy (Ward 1) said that as a woman, having come up with the feminist movement, her political engagement had begun with women’s rights. She found his position on women “absolutely degrading,” and concluded that there’s “no way I could support him.” Hieftje asked if Kailasapathy had met with McWilliams and discussed his views on women, or if she was basing her opinion on his online work. Kailasapathy indicated that she’d emailed back and forth with him.

Hieftje responded to the commentary up to that point with sarcasm by saying, “The fact that somebody used profanity on the Internet, I am shocked that this occurred. It’s almost unbelievable that there would be profanity used on the Internet.”

Mayor John Hieftje.

Margie Teall (Ward 4) said she was extremely uncomfortable assuming that someone who takes on a persona on the Internet would necessarily behave that way at the DDA or in a governmental position. She couldn’t understand why that assumption would be made. Almost off mic, Kunselman responded to Teall by saying that recently a DDA member had resigned [an allusion to the resignation of Nader Nassif from the board after being arrested for sexual assault]. Teall said she’d met with McWilliams, calling him a delightful person. Teall felt he’d be someone who could add energy to the DDA and add a unique and youthful perspective, concluding that that’s a good thing.

Christopher Taylor (Ward 3) said he’d support McWilliams. If the city is interested in having young entrepreneurs participate in the governmental process and to invest in the downtown and to become a part of civic life, then the door shouldn’t be shut on someone for exhibiting some of the characteristics of that generation. Those characteristics include an “ironic irreverence” to things, he said. Taylor described McWilliams as a valued member of the Ann Arbor business community who has the full support of the Main Street Area Association. Taylor felt he’d serve with “temperance, smarts, and distinction.”

Chuck Warpehoski (Ward 5) offered by way of analogy Al Franken. He’d support Franken for the U.S. Senate if he lived in Minnesota, even if he thought that Franken’s book – “Rush Limbaugh Is a Big Fat Idiot” – was inappropriate for attacking someone for their weight. During the Bush years, if Warpehoski had been a member of the Republican Party, he would have supported the re-election of vice president Dick Cheney, even though Cheney told a member of the Senate to “go eff himself,” and that’s not decorum worthy of the office. Warpehoski indicated that he didn’t think that profanity and saying inappropriate things disqualifies someone from public service.

Sabra Briere (Ward 1) reported that she did not find herself offended by what McWilliams had written on the Internet. But it had been pointed out to her that this behavior could be considered immature and so she had talked with him on the phone. Her impression was that he felt comfortable talking to someone of her generation: “We did not exchange expletives, mine or his.”

She’d asked him about what he wanted to accomplish on the board of the DDA. She said she didn’t find anything to worry about – except that he wanted to dig into the mission of the DDA and what it was supposed to be accomplishing. She was impressed that he’d chosen Ann Arbor, when he had other different opportunities. He saw himself as an independent player and had not taken a subservient role, she said. For councilmembers who were concerned that some DDA board members didn’t know when to say no to the council, she thought that could be a benefit. She’d enjoyed talking to him.

Outcome: Al McWilliams was judged confirmed to the DDA board on a 6-5 vote. Voting against the appointment were Mike Anglin (Ward 5), Sumi Kailasapathy (Ward 1), Sally Petersen (Ward 2), Jane Lumm (Ward 2) and Stephen Kunselman (Ward 3).

For a Chronicle op-ed on the procedural issues in connection with the McWilliams appointment, see: “Column: On Counting to 8, Stopping at 6.”

New Council Rules

The council considered approval of a new set of council rules, three months after they were first presented for consideration. Among the substantive changes that survived that three-month delay included the following: adding an opportunity for public commentary to work sessions; changing the order of the agenda to move nominations and appointments for boards and commissions to a slot earlier in the meeting; and prohibiting the use of personal electronic communications devices while at the council table.

A revision to the rules was first presented to the council on June 17, 2013. However, a vote was postponed at that meeting. The revisions were prompted by a desire to allow for public commentary at council work sessions – to eliminate any question about whether councilmembers were engaged in deliberative interactions at those sessions. By allowing for public commentary at work sessions, the council would ensure compliance with Michigan’s Open Meetings Act.

The council’s rules committee also recommended additional changes, including a shortening of the individual speaking turns for public comment as well as shortening of time for councilmembers. Those additional changes were included in the June 17 version of the rules. After again postponing a vote at its July 1, 2013 meeting, the council used its following meeting, on July 15, to eliminate one of the proposed rule changes – the shortening of public speaking turns. But the council postponed further revisions and a vote until Sept. 3. The council again postponed a vote on Sept. 3, 2013 because the council’s rules committee had not met in the interim.

On Sept. 10, the rules committee did meet, and the consensus appeared to be that no shortening of speaking turns for the public or for councilmembers should be undertaken and that the procedure for reserving public commentary time at the start of the meeting should not be altered.

New Council Rules: Public Commentary

During public commentary reserved time at the start of the meeting, Thomas Partridge stated that he’s a write-in candidate for Ward 5 city council. He called for reform of the council rules to expand opportunities for public participation. He called for an unlimited number of public speakers at the start of the meeting. He noted that the Washtenaw County board of commissioners manages its meetings in that manner.

New Council Rules: Council Deliberations

Marcia Higgins (Ward 4), chair of the rules committee, deferred to committee member Sabra Briere (Ward 1) to introduce the item to the council, because she’d been unable to attend the last committee meeting due to an ankle injury. Briere reviewed the history of the proposed revisions. Councilmembers at the last committee meeting had come up with a fresh proposal, which was being considered by the council that night. She reviewed each change, saying that she hoped councilmembers had reviewed the set of changes themselves.

The council first accepted the substitute, fresh version of the rules. [.pdf of council rules as adopted]

Higgins thanked the committee for doing a great job while she wasn’t there. She called the new draft a great piece of work. Mayor John Hieftje said one thing stuck out for him. He noted that the public commentary time for work sessions required to begin no later than 8:45 p.m. Hieftje wondered if that’s feasible.

City administrator Steve Powers indicated that some flexibility might be required to be able to continue the discussion. But he suggested it would be useful to indicate in the rules some guidance on the council’s expectations about how long the working sessions will last.

Chuck Warpehoski (Ward 5).

Chuck Warpehoski (Ward 5) noted that working sessions have not always started at 7 p.m. So he suggested that the beginning of public commentary time could be specified to be 105 minutes after the posted start time. City attorney Stephen Postema indicated that the council could vote to suspend that rule and change the procedure. Hieftje said he would feel more comfortable if the time indicated were 9:15 p.m. Jane Lumm (Ward 2) suggested that perhaps no time needs to be specified.

Higgins allowed the changes won’t affect her [because she's leaving council after the Nov. 5 election]. She noted that the council for some time has been working with the city administrator on the structure of work sessions. She ventured that the rule could simply be suspended and she didn’t think that it would happen very often. Lumm thanked the committee for its work. She said the initial proposal to shorten speaking turns was an overreaction to a couple of very long meetings. She felt it was a good move to abandon that approach.

Lumm ventured that the addition of public commentary during work sessions would add an opportunity for additional public dialogue. She was happy to support the rules changes. Hieftje said he appreciated Lumm’s comments. The committee had wanted to get the whole council’s feedback on the proposed changes, he said.

Warpehoski then moved to strike the language setting the time when public comment at work sessions would start. Christopher Taylor (Ward 3) said he didn’t think it was that big a deal. He’d concluded from Powers’ remark on the subject that Powers meant the staff would find some mention of a time as helpful discipline.

Stephen Kunselman (Ward 3) said he’d follow Taylor’s lead on this, agreeing that the time should be left in. Briere noted that because the rules can be amended and there’s no limit on the number of speakers, it gives members of the public a clear indication of when they need to appear at the meeting in order to speak. It gives a firm commitment to the public, Briere said. She observed that Monday night is a school night.

Margie Teall (Ward 4) said she’d support Warpehoski’s amendment. She didn’t think 15-20 minutes one way or another would make a big difference.

Outcome on Warpehoski’s amendment: The amendment failed on a 5-6 vote. Voting against it were Marcia Higgins (Ward 4), Mike Anglin (Ward 5), Sabra Briere (Ward 1), Sally Petersen (Ward 2), Christopher Taylor (Ward 3) and Stephen Kunselman (Ward 3). So the “no later than 8:45 p.m.” start time stayed in the public commentary for work sessions.

Without significant further deliberations, the council voted on the rules as a whole.

Outcome: The council voted unanimously to approve changes to its internal rules, with all councilmembers present by that time in the meeting.

Ann Arbor DDA Ordinance

On the Sept. 16 agenda was a final vote on revisions to a city ordinance regulating the Ann Arbor Downtown Development Authority tax increment finance (TIF) capture.

The city council and the DDA board have a joint committee that is working out details of an alternative, “dual track” to the ordinance amendments that have already been given initial approval by the council.

The initial DDA ordinance revisions that appeared on the council’s Sept. 16 agenda were awaiting a second and final vote by the council. The amendments to Chapter 7 included various changes to governance, including term limits for board members, as well as clarifications to the existing language on TIF capture.

The amendments would enforce the existing language of the ordinance in a manner that would impact the DDA’s TIF revenue in a way roughly matching the DDA’s projected revenues in its 10-year planning document. However, since that 10-year document was last updated, the amount of new construction in the DDA district has resulted in significant increases in the taxable value on which TIF is computed. So about $1 million a year is at stake – which could be distributed to the other jurisdictions whose taxes the DDA captures, instead of being collected by the DDA.

Under the existing ordinance language, the amount of DDA TIF capture is calibrated to projections in the DDA TIF plan, which is a foundational document for the DDA. The different conceptual approach – the “dual track” – would establish a basis level for the maximum captured taxable value in the DDA district and then set some clearly defined annual increase, keyed to a specific percentage or some variant of a consumer price index (CPI).

For example, the current taxable value on which the DDA captures taxes is roughly $137,000,000. That yielded about $3.76 million in TIF revenue to the DDA in fiscal year 2013, which ended on June 30. If that $137,000,000 were used as a basis for the cap, then a 3% increase applied annually would give the DDA a maximum of $5.063 million in 2023. In any given year, the DDA would receive the lesser of two values: (i) the unconstrained TIF captured on the taxable value; or (ii) the value of the cap.

A working document used by the joint committee at its Sept. 10 meeting showed two basic scenarios, one with a basis of $137,000,000 in taxable value for FY 2013, and a second one starting with a basis of $167,000,000 for the following year, in FY 2014. The second one received more interest from the committee.

The council had postponed a final vote on the changes most recently at its Sept. 3, 2013 meeting. Four months earlier, on May 6, 2013, the council had voted to postpone the final vote until Sept. 3, after giving the changes initial approval at its April 1, 2013 meeting.

Two meetings of the joint committee of DDA board members and city councilmembers have taken place about the ordinance changes – one on Aug. 26, 2013, eight weeks after the committee was appointed, and another one on Sept. 10, 2013.

At the Sept. 10 meeting, the group appeared to be ready to recommend that the council table the initially-approved ordinance changes and start from scratch with a new conceptual approach, likely shedding the proposed changes to governance with the fresh start.

DDA Ordinance: Public Commentary

During public commentary reserved time at the start of the Sept. 16 meeting, Thomas Partridge called for reform of the relationship between the city and the Ann Arbor DDA. He wanted the DDA district to expand to include all the commercial areas of the city. He ventured that perhaps mayor John Hieftje did not want to do that because Hieftje, as a former real estate agent, might have a financial interest in maintaining the DDA boundaries “contracted” as they are.

David Blanchard introduced himself as chair of the city’s housing and human services advisory board (HHSAB), and spoke on the issue of the DDA ordinance revisions. He noted that the HHSAB board has passed a resolution on this issue. A lot in the revisions goes beyond the HHSAB’s purview. But HHSAB is committed to affordable housing in this community, he says. [HHSAB wants the ordinance to require that the DDA set aside $300,000 annually for affordable housing, which is the amount set aside this year. And HHSAB wants that amount to increase each year.]

DDA Ordinance: Council Deliberations

Stephen Kunselman (Ward 3) reported on the second joint committee meeting. He said he wanted to give the DDA some time to review the numbers. He described the dual track. He wanted a postponement until Oct. 21.

Ann Arbor city administrator Steve Powers and Sumi Kailasapathy (Ward 1).

Sumi Kailasapathy (Ward 1) wanted clarification on the “dual track” that Kunselman mentioned. She didn’t have a clear understand if the joint committee recommendation would supersede the existing revisions, which the council has already given initial approval. She said there’s a lot of confusion. The joint committee, she said, seemed to be totally rewriting the revisions that the council had already approved. She was not comfortable with that, because there are other taxing jurisdictions involved. She was not very happy with the way things were turning out. Will the existing revisions be replaced by the version recommended by the committee? she asked.

Kunselman responded to Kailasapathy that after the first reading of the revisions was approved by the council, there was a lot of angst about the idea that the DDA would first collect and then return tax money to the other taxing authorities. [The current ordinance is conceived as involving a receipt of TIF revenue and then a return of that revenue to the other taxing jurisdictions.] So the joint committee is looking at a TIF cap, as a conceptual alternative. Kunselman read aloud the draft language from the working document. He said the idea is to make it as clear as possible. There’s no money to be returned because the amount the DDA gets in the first place is subject to the cap. A cap takes away the need to enforce anything, Kunselman said.

But Kunselman didn’t want to take the initially-approved revision off the table, because it allows the council to make that decision whenever the council chooses. He said he’s been trying to work cooperatively with the DDA, but allowed that DDA board members might not necessarily agree that he’d been doing that. The TIF cap approach would allow the DDA to set its budget more easily, he said.

At the Oct. 21 meeting, the council will likely have the committee’s proposal ready for consideration, Kunselman ventured. He’s focused on the TIF capture methodology, not the governance issue – which involves term limits, among other things. Those governance elements are included in the ordinance revisions that were approved at first reading. Amendments on the governance issue could come from the floor on Oct. 21, he said.

Kunselman told councilmembers that he doesn’t have all the answers and there’s more than one way to approach the issue. He called the changes to the language about TIF revenue the most important of the reforms.

Kailasapathy asked city attorney Stephen Postema if it’s possible for the council to just act unilaterally. Postema declined to give an analysis at the meeting, but said the council would receive advice on the ordinance changes as a whole. [More coverage from The Chronicle on the issue: "Library View on TIF Capture: Unchanged."]

Jane Lumm (Ward 2) tried to get some clarity on what’s going to happen next. She highlighted the clause in the ordinance that says the other taxing jurisdictions need to approve the removal of the restrictions.

From left: During the recess, Stephen Kunselman (Ward 3) and Chuck Warpehoski (Ward 5) examine the draft language and escalator definitions for a fixed cap on DDA TIF revenue.

Mayor John Hieftje made a gambit to discuss the issue further, suggesting that city administrator Steve Powers and DDA executive director Susan Pollay could provide some discussion of the TIF cap issue. Hieftje convinced Kunselman to withdraw his motion to postpone.

Powers explained that in cooperation with DDA staff, the draft language was prepared as an alternative. The draft proposal sets a basis for the taxable value and caps the amount of TIF with yearly increases, he explained. The amounts were chosen to recognize the growth that was currently occurring and to allow the DDA to retain that growth. The percentage increases could range from 3% to 10%. Pollay described how the DDA would be assisted by city CFO Tom Crawford in modeling the impact of different percentages in the escalator.

Chuck Warpehoski (Ward 5) asked that the draft language be provided to the council as a whole. The council then took a recess to allow the city clerk to make some copies and distribute them.

When the council returned from recess, Lumm wanted to know the rationale for establishing the baseline value at $167 million. Powers replied that it would allow some future growth. Lumm pointed out that this would mean $700,000 in additional revenue to the DDA. Powers noted that the idea is to provide enough revenue so that the DDA can accomplish the projects in its draft five-year plan. [For coverage of the DDA board meeting when the five-year plan was reviewed, but not voted on by the DDA board, see "DDA Kicks Off Fall with $300K Grant."] Powers noted that the whole council had been provided with the draft five-year plan.

Lumm asked why there was not a lot of enthusiasm from the committee for a CPI index. Taylor explained that the regular CPI is not related to the kind of construction projects the DDA undertakes. So that’s not a neat fit for the kind of cost increases the DDA will have to contend with. It’s key that the escalator be reasonable, but Lumm called 10% – which is one of the options indicated in the draft “dual track” language – “off the charts.”

Kunselman indicated that will be the topic of the next committee meeting. The joint committee is scheduled to meet on Oct. 16 at 4 p.m. in the council workroom on the second floor of the Ann Arbor city hall, 301 E. Huron. The meeting is open to the public, and based on the first two committee meetings, an opportunity for public comment will be provided.

Outcome: The council voted to postpone the DDA ordinance revisions until Oct. 21, 2013.

Fossil Fuel Divestment

A resolution on fossil fuel divestment – which was defeated at the council’s previous meeting on Sept. 3, 2013 – was brought back for a re-vote on Sept. 16. The resolution calls on the city’s employee retirement system board to stop investing in fossil fuel companies. The retirement system board is not required to follow the council’s encouragement.

Voting against the resolution on its initial consideration on Sept. 3 were Stephen Kunselman (Ward 3), Margie Teall (Ward 4), Mike Anglin (Ward 5) and Sally Petersen (Ward 2). So at that meeting, the resolution fell short of the six-vote majority it needed on the 11-member council. Jane Lumm (Ward 2) and Marcia Higgins (Ward 4) were absent on Sept. 3.

During their Sept. 3, 2013 meeting, councilmembers asked Nancy Walker, executive director of the city’s employee retirement system, about implications for the retirement fund. Walker had told the council that moving to separately managed accounts from the system’s preferred strategy – of using co-mingled funds, mutual funds, and particularly indexed funds – would cost 30-40 basis points more in fees, independent of any difference in the return on investment.

In more detail, an energy commission resolution passed on July 9, 2013 recommended that the city council urge the city’s employee retirement system board to cease new investments in fossil fuel companies and to divest current investments in fossil fuel companies within five years. The resolution defined a “fossil fuel company” to be any of the top 100 coal companies or top 100 gas and oil extraction companies. The top three coal companies on the list are: Severstal JSC; Anglo American PLC; and BHP Billiton. The top three gas and oil companies on the list are: Lukoil Holdings; Exxon Mobil Corp.; and BP PLC. The basic consideration of the resolution is the importance of the role that greenhouse gas emissions play in global warming.

The resolution cited the city of Ann Arbor’s Climate Action Plan, which has a goal of reducing greenhouse gas emissions by 25% by 2025 and 90% by 2050. The resolution warned that fossil fuel companies have enough fossil fuel reserves that, if burned, would release about 2,795 gigatons of CO2. That’s five times the amount that can be released without causing more than 2°C global warming, according to the resolution.

By council rule, a councilmember voting with the prevailing side can bring back a question for reconsideration at the same meeting or the immediately subsequent meeting. On Sept. 16, that councilmember was Margie Teall (Ward 4).

Fossil Fuel Divestment: Public Commentary

Mike Shriberg spoke on behalf of the city’s energy commission. He told the council he had also served on the city’s climate action plan task force. He teaches energy policy at the University of Michigan, he said.

From left: Kirk Westphal, chair of the Ann Arbor city planning commission, and city energy commissioner Mike Shriberg .

He was surprised that the resolution at the last meeting was not approved, given the recommendation of the energy commission. He thought it was the first time a recommended resolution from the energy commission had failed to win approval. He called the resolution a first step in the implementation of the city’s climate action plan. So he felt that the two votes by the council – to approve the climate action plan but to reject the fossil fuel divestment resolution – were inconsistent. Shriberg noted there wasn’t a lot of debate on the resolution at the previous council meeting.

Shriberg addressed some of the objections given by councilmembers for voting against it: Was it wise financially? He allowed out that fossil fuel companies have done well in the last several years, but noted that past performance may not be indicative of future results. But if you go back the last 50 years, fossil fuel companies show no better performance than other companies. He ventured that currently we could be in the middle of a bubble and that investments in fossil fuel companies could be at risk. He contended that there’s little or no risk from pulling back from investments in fossil fuel holding companies. Examples in 15 other cities have not shown any negative effects of divesting, he said.

Shriberg also addressed the argument that it’s arbitrary to pull investments out of the 200 targeted companies. The selection of those companies, he said, is based on fossil fuel reserves. If the fossil fuel reserves of those companies were burned, he explained, it would generate five times the “safe limit” of carbon emissions for climate change. So he did not think there’s anything arbitrary about it. He contended that divestment has massive citizen support and noted the council has received the supporting petitions of hundreds of citizens.

The final objection Shriberg addressed related to the question: Does the fossil fuels divestment resolution tie our hands? He noted that the resolution in no way takes away fiduciary responsibility. That responsibility will always come first. It would open up the possibility for a category of investment that would benefit the local and global community, he said. The energy commission had really done its homework, he said. Shriberg felt it’s time to align the city’s commitments [the climate action plan] with potential actions [fossil fuel divestment].

Wayne Appleyard addressed the council as current chair of the energy commission. He wanted to impress on the council the importance of passing the fossil fuel divestment resolution. He pointed out that it got a majority of votes at the previous meeting, just not enough to pass. He stressed that the retirement board is an independent body, so the resolution is only a recommendation and is not binding. Because it’s only symbolic, there’s no important reason not to vote for it, he said.

Divestment resolutions in the past have been helpful in effecting social change on important issues, he said, including apartheid in South Africa and the effects of tobacco. Climate change, which is mostly the result of burning fossil fuels, he said, is the most important to ever face humankind. This resolution will send a message to fossil fuel companies and others that the city wants the world to reduce dependency on fossil fuels, he said. Appleyard contended that fossil fuel investments will become increasingly riskier. This resolution will help create the market for non-fossil fuel funds, he concluded.

Dina Kurz also addressed the council as a member of the energy commission. She’s a longtime resident of Ann Arbor. She talked about the urgency behind the request to pass the resolution. The politics are hard to change, but the laws of physics are immutable, she said. It’s not a question of technology, she told the council, but a question about the political will that’s necessary. The companies cited in the resolution were chosen for the amount of their carbon reserves. By burning those reserves, those companies could raise the global temperature beyond the “safe level.” It’s a quality of life issue that affects the city’s retirees, she said. It’s a question of social responsibility, she adds. Kurz compared potential action on the fossil fuel issue to past public action against the health effects of tobacco and South Africa apartheid.

Dave Marvin introduced himself as a University of Michigan doctoral student in the department of ecology. He told the council he spends 10 months of the year in the forests of Panama – as his research focuses on the effects of climate change on tropical forests. He’s seeing the impact of climate change in the forest. Before starting graduate school, he’d also worked for two years in Washington D.C. on climate change legislation. Divestment will align the city’s investments with its climate action plan, he said. It’s logically inconsistent to provide financial support to the industry that is responsible for climate change, Marvin said.

Laura Hobbs introduced herself as an undergraduate at the University of Michigan. She was born and raised in San Francisco, she told the council, but she’d decided to attend UM because she thought of Ann Arbor as a socially conscious community. Students like her would like to live and study in an environment of environmental justice, she said. She’s participating in a divestment campaign at UM. As students, they look to Ann Arbor as a leader for progressive change, she said. Hobbs wants Ann Arbor to be a role model for UM. She asked councilmembers to pass the resolution on divestment from fossil fuels.

Jane Lumm (Ward 2) talks with Kai Petainen about the fossil fuel divestment resolution.

Larry Junck spoke in favor of the resolution on divestment from fossil fuels. He’s a professor of neurology at the University of Michigan. He made three points. First, it’s a sound investment decision, he said. Second, divestment is consistent with the city’s climate action plan. Third, it’s effective local action – because it’s not about getting people in far-away cities to take action. In sum, he said, the council has the opportunity to do Ann Arbor’s part to keep the world a livable place for our children and grandchildren.

During public commentary time at the end of the meeting, after the vote on the fossil fuels divestment resolution had been taken, Kai Petainen addressed the council. [Petainen writes for Forbes on the topic of investing.] He talked about shareholder activism. Sometimes the best strategy is to buy shares and show up to shareholder meetings, he suggested. It’s also possible to take a stand about individual companies, he said. If you exclude an entire sector of the economy, no one will care, he cautioned. If you avoid the energy sector, Petainen told the council, no one will care, because someone else will buy those shares.

Fossil Fuel Divestment: Council Deliberations

The first step in the process was to vote on the question of reconsideration.

Outcome: The council voted unanimously to reconsider the resolution on fossil fuel divestment.

Margie Teall (Ward 4) indicated that she had felt she needed to vote against the resolution the first time around, but that she’s learned a lot more about the issue since the first time the council considered it. So she would now like to see the resolution passed.

Mike Anglin (Ward 5) recalled the remarks that Nancy Walker had made at the previous meeting about moving money out of indexed funds having an inherent cost associated with it.

Sally Petersen (Ward 2) noted that there are significant costs associated with the divestment, according to Walker. Petersen pointed out that fiscal responsibility is one of the council’s stated goals and priorities. She reported that she’d done additional research herself, and she pegged the costs in the hundreds of thousands of dollars. She ticked through the five council priorities identified in December 2012. She suggested a different approach for such a resolution. Instead of divesting, she suggested that a call for investment in clean energy would be more proactive.

Christopher Taylor (Ward 3) called divestment from fossil fuels an important issue. He noted that the council doesn’t control the pension board. He proposed an amendment that replaced the next-to-last resolved clause on the timeline – that the city council acknowledges that compliance with the requests has to be consistent with the pension board’s fiduciary responsibility. The exact wording of Taylor’s amendment was:

RESOLVED, That the City Council acknowledges that compliance, if any, with the requests above must be consistent with the Retirement Board’s fiduciary duties; and …

Stephen Kunselman (Ward 3) said he didn’t want his name in the newspaper five years from now, associated with council action that had caused underfunding of pensions. So he felt that Taylor’s amendment helped address that concern. Kunselman cautioned against meddling in other organizations.

Outcome: Taylor’s amendment was approved over dissent from Petersen.

Nancy Walker, executive director of the city of Ann Arbor’s employee retirement system.

Nancy Walker was asked to come to the podium. Sabra Briere (Ward 1) said based on the council’s previous meeting, her understanding was that there were no funds in which the pension board could invest that didn’t include fossil fuels. Walker responded by indicating that on initial review, there were not any indexed funds that specifically screened out fossil fuels, but there were some “socially responsible” funds. Briere ventured that there are perhaps no such funds because there’s no demand for them. By asking the board to look at divesting, that might help to generate demand for such funds. “If it’s never asked for, it’s never going to be given,” said Briere.

Sumi Kailasapathy (Ward 1) recalled that at the last meeting, Walker had said the costs would be 30-40 basis points to move the money out of indexed funds. That would apply to as much as half of the total investments of the fund, Walker confirmed.

Marcia Higgins (Ward 4) felt like the council was going off on a tangent by not asking the pension board what it could do with such a resolution. She didn’t feel like there was “enough meat” in the resolution. Higgins wouldn’t support the resolution, but suggested postponing it until the pension board could meet to discuss the issue.

Walker indicated that the trustees on the pension board are eager for dialogue, but this could require a substantial amount of research. Higgins said she wanted a dialogue with the pension board. Kunselman added that he wanted a public hearing on this topic. He agreed with the idea of postponing a vote, however. He said that the state of California’s pension board had adopted a policy to be socially responsible. Does the city’s pension board have such a policy? Kunselman asked? No, replied Walker.

Kunselman said he really wants to be able to vote for the fossil fuel divestment resolution, but struggled with the obligation to taxpayers. He noted that none of the large universities have gotten on board with the idea of divesting from fossil fuels. He added that he works with energy issues at the University of Michigan. Kunselman concluded that he would support a postponement.

Jane Lumm (Ward 2) followed up with more questions for Walker. She said she had to scramble to educate herself, because she missed the last meeting, and the item was added to this meeting’s agenda just that day. Lumm and Walker discussed basis points for fees for a bit. Lumm recalled that back in the 1990s, there was a “socially responsible” investment policy, which was then abandoned because the returns were significantly lower.

Briere moved for postponement until Oct. 7 to give time for the pension board to meet and review the issue. Taylor suggested that the timeframe be extended. Conversation on the topic of the postponement date resulted in a consensus around Oct. 21.

Kunselman wanted to add a public hearing for Oct. 21. But Higgins cautioned that the public hearing comments wouldn’t be informed by the pension board’s communications. So Kunselman withdrew his request that a public hearing be added.

Mayor John Hieftje indicated he didn’t see any need to postpone, saying there’s no reason to delay. He argued that no harm would be done to the pension fund. He characterized the resolution as just a request that the pension board take a look at something.

Anglin indicated he’d support the postponement, given that a lot had been heard on both sides of the issue. Chuck Warpehoski (Ward 5) said he’d support the postponement too, because he feels that the longer it stays in the news, that fits into the campaign for putting pressure on fossil fuels companies. For now, he said, he wanted to keep the conversation going, because “What else do we have to do on a Monday night?”

Petersen focused on the “resolved” clause specifying a five-year timeframe within which divestment was supposed to be accomplished. She called the timeframe of five years very significant. She wanted to vote on the resolution that night because she felt so strongly. But she felt that it’s the council that needs to do some work on the issue. She wanted the energy commission to consider a more proactive resolution on investing in clean energies, instead of divesting from fossil fuels.

Briere allowed there’s a difference between fossil fuels and apartheid, but they both are social issues, she said. It’s about money, but it’s also about people and the future. She was content to let the energy commission take a look at it and to have the pension board look at it. The postponement is not meant to bury the resolution, she noted, adding that if the council is not ready to vote in a month from now, it probably never will be.

Lumm said she was ready to vote that night. She did not support the resolution, saying her opposition has everything to do with being a good steward of taxpayer money. It would mean divesting from an entire sector of the economy, she said. She was torn on the postponement, she said. There’s an opportunity to understand the issue more thoroughly. Lumm noted that the city has a defined benefit plan, and she’s been pushing the city to convert it to a defined contribution plan.

Hieftje said he’d been persuaded to support a postponement.

Outcome: The council voted unanimously to postpone the fossil fuel divestment resolution until Oct. 21.

Honda Testing Facility Site Plan

The council was asked to approve the site plan for the expansion of Honda’s testing facility, located north of Ellsworth on Research Park Drive in Ann Arbor.

Honda testing facility site.

The project will more than double the size of the existing facility and increase the number of American Honda Motor Co. employees who work at the site from 6 to 10, according to the city planning staff. The existing 19,357-square-foot building, built in 1975 and used for vehicle testing, is located at 3947 Research Park Drive on a 2.72-acre site. The proposal calls for building a two-story, 24,116-square-foot addition. Part of that square footage includes a basement level.

According to Honda, the expansion will include a state-of-the-art environmental testing chamber, to help Honda develop vehicles with cleaner fuel emissions. Two of the site’s seven landmark trees would be removed, and mitigated by planting six new trees. In addition, 32 shrubs will be planted in front of the new addition. A 5-foot public sidewalk will also be built along Research Park Drive. A variance related to the size of the existing curbcut was needed from the city’s zoning board of appeals.

The site is zoned RE (research district) and no rezoning was requested.

The project is being managed by Poggemeyer Design Group in Bowling Green, Ohio. The estimated construction cost is $4.3 million.

One person spoke during the public hearing on the site plan. Thomas Partridge wanted the chair of the planning commission to attend every council meeting when there’s a site plan – to explain the planning commission’s recommendation to approve the site plan. He said that a representative of Honda should be present. He called for more accessibility of agenda information on the Internet. He asked where the stormwater on the site would go.

Outcome: The council voted unanimously without discussion to approve the Honda testing facility site plan.

Leaf Truck Rental

The council considered approval for the rental of eight rear-loading trucks from Premier Truck Sales & Rental Inc. for the fall leaf collection season.

A leaf truck rented from Premier Truck Sales & Rental in action back in 2011 on the Old West Side in Ann Arbor.

The truck rental is an annual approval. The trucks are being rented in order to handle the increased volume of yard waste during the fall season. Based on the staff memo accompanying the resolution, the city has a fleet of three side-load compost trucks, which have smaller “hoppers” designed for routine collection of a couple of compost carts per stop. The frequency of “packing” required for the truck – during which no waste can be added – depends on the hopper size. The rental trucks have much larger hoppers so “packing” is less frequent.

Overall, the city of Ann Arbor says it saves money with its current “containerized” leaf collection approach – which allows residents to use paper bags or composting carts – compared to its previous practice of inviting residents to sweep their leaves into the street for mass collection with front loaders and dump trucks.

The bid from Premier Truck Sales & Rental Inc. was just under that of Bell Equipment company – $11,880 compared to $11,920 per truck.

Jane Lumm (Ward 2) had a question about how many employees are used for the fall yard waste collection – how many hours and the cost. She was content to have that information forwarded later. [Lumm has argued unsuccessfully the last two years during the adoption of the budget in the spring for the restoration of the approach in which the city invites residents to sweep their leaves into the street for mass collection.]

Outcome: The council voted to approve the rental of additional trucks for use in fall leaf collection.

North Main Huron River Task Force Report

The council considered formally accepting the final report of the North Main Huron River Corridor task force, which was established at the council’s May 7, 2012 meeting. Its report had been due at the end of July 2013. However, Sabra Briere (Ward 1), who served on the task force, had apprised the council during communications time at previous council meetings to expect a slight delay.

The resolution formally accepts the group’s final report and directs the city administrator to plan for the recommendations “as feasible within the constraints of available resources and other priorities.” The report includes some before-after photos depicting possible improvements, like a pedestrian bridge across the Huron River connecting the Argo berm to the DTE/MichCon property, as well as recommendations on the use of city-owned property at 721 N. Main.

David Santacroce, who chaired the task force, appeared at the council’s Sept. 16 meeting to present the report. He ticked through the main elements of the report, saying: “This is what you asked us to do.”

He highlighted the fact that there were 19 public meetings of the committee, and reviewed the public engagement process.

Not a lot had happened as a result of the two previous studies, he says. But the little secret of the Huron River is out, he noted, and the area is now “packed.” Residents come from all corners of town, he said. “We’ve got a river in the middle of town.” The public wants and expects improvements, he said.

He noted that the recommendation of the task force for the two buildings on 721 N. Main not in the floodway is to demolish them. That’s based on a $6 million estimated cost to restore them to a “white box” type state.

Santacroce also talked about idea of asking the planning commission to explore the concept of “riverside zoning” for North Main Street. He described how many people cross the railroad tracks illegally to gain access to the river – including himself. It’s dangerous, illegal, but highly used, he said.

Santacroce summed up by saying that it’s hard to imagine a more thoroughly vetted proposal by the public. He calls many of the recommendations “soft,” which means that they are recommendations to study this or look at that.

Mayor John Hieftje praised the work of the committee.

Sally Petersen (Ward 2) asked about the concept of riverside zoning. Santacroce explained that it’s prime real estate. The idea is that the proper city commission with the proper expertise – the planning commission – should take a look at the concept.

Jane Lumm (Ward 2) applauded the effort of the committee. The report has lots of important suggestions for an important gateway into the city, Lumm said. She had served on the council back in the mid-1990s when the two previous studies were done and they pretty much sat on a shelf, she said.

Marcia Higgins (Ward 4) called the concept of riverfront zoning an excellent idea. She reminded the council that M1 zoning – which riverfront zoning might replace – is being reduced throughout the city, and pointed out that a place for that type of light industrial use (M1) will need to be found.

Outcome: The council voted unanimously to accept the North Main Huron River corridor task force report.

Communications and Comment

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

Comm/Comm: UM Football Street Closures.

As part of the council’s resolution approving street closures around the University of Michigan’s football stadium on home game days – which passed on a 7-4 vote taken on Aug. 8, 2013 – the council asked that a preliminary assessment of the traffic control measures be given at its Sept. 16 meeting by AAPD chief John Seto. An additional report from Seto – after meeting with neighborhood groups – is to be given to the council on Oct. 7.

UM football game day street closures (pink) with detour route (purple).

The first three games were considered to offer a reasonable chance to assess initially how the street closures are working out – because they all started at different times: noon (Akron); 3:30 p.m. (Central Michigan University); and 8 p.m. (Notre Dame).

Most of the traffic controls were approved to be in place for the period starting three hours before a game until the end of the game. However, the closure of the southbound lane on Main Street was restricted to just one hour before the game start. Traffic controls include the following: E. Keech Street between S. Main and Greene streets are closed. Access to Greene Street from E. Hoover to E. Keech streets is limited to parking permit holders. The westbound lane on E. Stadium Blvd. turning right onto S. Main Street (just south of the Michigan Stadium) is closed. And S. Main Street would be closed from Stadium Blvd. to Pauline.

At the Sept. 16 meeting, Seto took the podium to address the council with the preliminary report. He noted that a community meeting is scheduled for Tuesday, Sept. 24 at 6 p.m. at Pioneer High School to gather additional feedback. So Seto stressed that his remarks that evening were his own observations and comments he’s heard, and he’d reserve conclusions until the community has had an opportunity to make comments, which will be reflected in his final report on Oct. 7.

Seto reported that he’d walked the area and talked to some of the residents who might be most impacted by the street closures – in the neighborhoods just west of Main Street. For the first game he’d talked to three people who felt that the street closures had an impact on the number of people who were able to park. Some residents and visitors reported that there had not been a negative impact on the number of people who were able to park in the neighborhoods. For the Notre Dame game, Seto said, he walked the same neighborhoods, and spoke to the same three people who’d expressed concerns. This time, they’d reported negligible impact for that game – as far as the number of people who were able to park on the lawns.

One piece of feedback he’d received from almost all the residents was that they were appreciative of the additional police presence in the neighborhood pre-game and during the game for the perceived curtailment of some disorderly conduct.

Seto reported that some positive feedback on the different treatment of the southbound lane of Main Street – leaving it open until just one hour before the game start. Some residents felt that it helped, and were appreciative of the council’s action to make that modification. And others felt that the closure of the northbound lane didn’t need to be closed as early as three hours before the game.

Seto reported that some of the signage was improved after the first game. The street closures were much smoother for the second and third games, he said, from AAPD’s perspective. The general message Seto gave was that he did not observe any significant issues with respect to traffic during the first three game days. Seto said for the third game, with its noon start time, there had been some congestion and backup of traffic. That feedback came from a resident on Pauline, he said. He said that traffic control at Main and Pauline would be done a bit earlier in the future, to see if those congestion issues could be relieved.

Public services area administrator Craig Hupy confirmed that the detours were tweaked in the course of the three games and he felt it was functioning better with each game. He said that during the pre-season meetings, the feedback staff had heard was that traffic flow on westbound Stadium Blvd. wasn’t working as well as it should. The bottleneck had been identified by staff as Jackson and Maple at Stadium Blvd. So they’d worked on timing the signals differently. He felt some improvement had been made. But he held off concluding that the problem had been solved, because each game is different, and has different fan dynamics.

Marcia Higgins (Ward 4) followed up with questions. She reported that for the Notre Dame game, she’d decided to drive down and see how things were going. She thought the situation was being managed very well. She was in the vicinity between 7:30 and 8 p.m., she said. It had taken her 20 minutes to get from 7th Street down to Main Street. She was concerned about the ability of police to control pedestrians at the street corners to keep them off the street. Cars were having a difficult time navigating around that, she said. Coming down Main Street toward Scio Church Road, by Pioneer High School, she also noticed a lot of open intoxicants, saying that she’d seen some people just sort of fall down from drinking.

Seto reported that for the Notre Dame game, there were a lot of pedestrians trying to get to the game. Something that helped was to get the pedestrians to a point north of Stadium Boulevard. Because Main Street was closed to vehicular traffic beyond that point, they were able to cross freely. He noted that south of Stadium Boulevard there’s no sidewalk opposite Pioneer High School on Main Street, which affects pedestrian behavior. He reported that there were a lot of citations for open intoxicants.

Higgins reported for the noon start game, around 11:30 a.m. traffic was backed up on Scio Church Road going toward Wagner Road. She felt the problem was the traffic signal at Maple and Scio Church roads. She wanted more traffic to be allowed to come into town.

Mayor John Hieftje put the number of open intoxicant citations at around 180. He noted that the city is not a big fan of night games, but said the AAPD did a good job of keeping the lid on everything.

Comm/Comm: City Crosswalk Ordinance

By way of background, the city released a memo on Sept. 9, 2013 with a review of the city’s crosswalk ordinance. The planning commission, at its Sept. 10, 2013 meeting, approved the update to the city’s non-motorized plan, and recommended that the city council do the same.

During public commentary reserved time at the start of the meeting, independent Ward 1 city council candidate Jeff Hayner addressed the council on the topic of the city’s crosswalk ordinance. He cited two recent documents related to the issue – the non-motorized plan update and a Sept. 9 memo reviewing the crosswalk safety ordinance. The non-motorized plan calls for the addition of 24 additional flashing crosswalk indicators. And the memo indicates that compliance with the city’s ordinance has increased at those locations where such flashing indicators have been installed. He called that good news. The recommendations include measures to increase compliance with the crosswalk ordinance – like adding signs and pavement markings. But he said that there’s still a community perception and a “tragic reality” that the city’s crosswalks are unsafe.

From left: Mayor John Hieftje, Ward 1 independent candidate for city council Jeff Hayner.

Hayner noted that the non-motorized plan calls for five E’s for promoting bicycling culture, but contended that three are absent from work the city has done to implement connection with the crosswalk ordinance: engineering, education and enforcement. [The five E's are: engineering, education, encouragement, evaluation, and enforcement.] He called for the re-evaluation of the crosswalk ordinance by a professional traffic engineer. He also called for the adoption of crosswalk design guidelines that are consistent with best practices. Educational efforts need to be conducted in a way to make sure that each party is certain of the other’s rights and responsibilities, he said.

Hayner said it’s not enough to proclaim that “pedestrians rule.” He characterized the crosswalk ordinance as “barely” enforced. He added that the signs for crosswalk compliance are confusing and not consistent with the crosswalk ordinance. As an example, on westbound Miller, the signs say, “yield to pedestrians in the crosswalk” but the ordinance says that motorists must also yield to pedestrians stopped at the curb, curbline or ramp. Hayner said that police chief John Seto has said he doesn’t have enough officers for proactive policing, but the council has repeatedly voted against increasing the number of officers available. Hayner called on appropriate funding levels to support for the city’s crosswalk program and to repeal the city’s crosswalk ordinance to bring it in line with state law and “common expectations” of behavior. He called it poor public policy to create an environment where the pedestrian is empowered and the driver is confused.

Kathy Griswold also spoke on the topic of the pedestrian ordinance. She recalled her public commentary from 2009 and a quote she had read on that occasion about sight distance, and how overgrown vegetation can affect that. She mentioned that the Ann Arbor Public Schools has adopted the AAA school safety patrol program. Consistent uniform operating procedures are essential, according to AAA, Griswold said. That means it’s important to have the same crosswalk laws in the entire country or at least one school district, she said. [She had a map with her to highlight the fact that the AAPS district is much larger geographically than just the city of Ann Arbor, but did not display the map to the council.] She asked the council to rescind the crosswalk ordinance.

Comm/Comm: 1,4-Dioxane

Mike Anglin (Ward 5) recalled the resolution the council had passed on the 1,4-dioxane plume at the previous council meeting, on Sept. 3, 2013. [The Washtenaw County board of commissioners passed a similar resolution at its Sept. 18, 2013 meeting.] On Friday the Coalition for Action on Remediation of Dioxane (CARD) had met, Anglin said, and now CARD would like to increase public outreach. He suggested that the city should receive quarterly reports on the issue. Even if the city has been excluded from a court decision, the issue was still important, he said. Anglin said the city needs to get more serious about this issue. He called for the data from well monitoring from this year to be delivered.

Comm/Comm: D1 Zoning Review

Sabra Briere (Ward 1) gave an update on the downtown zoning review. She said the final public forum would be held on Sept. 19 at Workantile on Main Street.

Comm/Comm: Thomas Partridge

During public commentary time at the conclusion of the meeting, Thomas Partridge asked voters to write in his name for the upcoming November election to represent Ward 5 on the city council. He said the council and the clerk should be urging people to register to vote. The city should put information about how voters can write in their selection for city council. No one in Ward 5 is able to stand up to the mayor’s “surly” attitude toward a variety of different demographics, including women, children and people with disabilities, he contended.

After Partridge exceeded his time limit – as he frequently does – he berated Hieftje for a bit. Hieftje asked Partridge if he wanted to be removed. Partridge relented. [In an email to The Chronicle, Hieftje indicated that the reason he'd threatened Partridge with removal was due to exceeding the time limit, not because of Partridge's criticism of Hieftje.]

Present: Jane Lumm, Mike Anglin, Margie Teall, Sabra Briere, Sumi Kailasapathy, Stephen Kunselman, Marcia Higgins, John Hieftje, Christopher Taylor, Chuck Warpehoski, Sally Petersen (arrived during deliberations on council rules, because she was attending to her daughter in the emergency room with a suspected case of appendicitis).

Next council meeting: Monday, Oct. 7, 2013 at 7 p.m. in the council chambers at 301 E. Huron. [Check Chronicle event listings to confirm date.]

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Downtown location of the Ann Arbor District Library (Photo by the writer, Sept. 21, 2013)

Other taxing jurisdictions besides the city of Ann Arbor – entities that also have a portion of their levied taxes captured by the DDA – have something at stake.  Those units are Washtenaw County, Washtenaw Community College and the Ann Arbor District Library. The topic of other taxing jurisdictions’ interest in the Chapter 7 revisions has been raised at three public meetings since late August: (1) at an Aug. 26 meeting of a joint city council and DDA board committee; (2) at the Sept. 15 city council Sunday night caucus; and (3) at the Sept. 16 city council meeting.

Some councilmembers have speculated about the current view held by one of the other taxing jurisdictions in particular – the Ann Arbor District Library. AADL director Josie Parker wrote a letter to mayor John Hieftje in January 2012 outlining the library’s position on the matter at the time, something that has been widely reported. The Chronicle only recently became aware that a similar letter had been sent by Parker to the Ann Arbor DDA in August 2011.

Those letters articulate a view that’s consistent with op-eds published in The Chronicle on the topic – that the DDA owes more in repayments to the taxing jurisdictions than the DDA agreed it needed to pay back in May 2011. Further, the AADL’s position, as expressed in the two letters from Parker, is to reject the DDA’s most recent and current interpretation of the city ordinance  – which was stated only after the DDA had already made repayments of excess TIF capture in 2011. Those repayments had been made to cover several prior years, because the required repayment had been “overlooked.”

The DDA’s subsequent interpretation was that the DDA did not owe the money it had returned in 2011. DDA officials maintain that as long as the DDA had debt obligations, it would also not owe any return of excess TIF to the other taxing jurisdictions in the future. Based on calculations by The Chronicle, the DDA’s current interpretation probably deprives AADL of roughly $55,000-$60,000 annually, compared to the kind of interpretation AADL gives the ordinance. That amount could increase, or decrease, in the future.

The position articulated in Parker’s August 2011 letter includes the statement: “The Library fully intends to enforce its rights for all past and future amounts owed to the Library as a result of excess TIF capture. However, the Library would prefer to resolve these issues without court involvement.”

Responding to a question in a telephone interview with The Chronicle on Sept. 19, 2013, Parker stated: “The position of the Ann Arbor District Library is still accurately reflected in those letters.”

That statement appears to resolve any uncertainty that might exist about the AADL’s current position. At the Sept. 15 Sunday night caucus, for example, Sabra Briere (Ward 1) had ventured that Parker’s letter to Hieftje might be appropriately regarded as a “snapshot in time” and might not reflect the AADL’s current position. And Christopher Taylor (Ward 3), during the Aug. 26 joint committee meeting, appeared to discount the current relevance of the letter to Hieftje by asking what year it had been sent.

However, about the AADL’s position on the DDA TIF capture taken in 2011, Parker stated this week: “It has not changed.”

The Chapter 7 revisions that have already received initial approval would essentially clarify and enforce the existing language in a manner that would ensure return of the excess TIF capture to other jurisdictions – starting in fiscal year 2015 – at levels corresponding roughly to the AADL’s view of the existing language. In terms of the DDA’s TIF capture – which was about $3.76 million in the recently ended FY 2013 – around $0.9 million in additional revenue is at stake, an amount that would increase as downtown development increases.

Based on Chronicle calculations, the AADL’s portion of the nearly $1 million in additional TIF that would potentially be returned would be in the ballpark of $55,000-$60,000 annually. The AADL levies the smallest millage of any of the taxing authorities in the DDA district – at 1.55 mills. The AADL annual budget is about $12.3 million.

The annual return of excess TIF to the AADL (and the other taxing jurisdictions, including the city of Ann Arbor) could increase (or decrease) depending on the amount of future new construction in the DDA district. The DDA captures taxes only on the difference between the taxable value of new construction compared with its baseline value. That’s the “increment” in the term “tax increment finance.”

The August 2011 letter from Parker to DDA executive director Susan Pollay argues that the DDA’s return of $74,666 to the AADL that year – which was meant to cover all the years dating back to 2004 – should have been around $200,000.

On July 1, 2013, a joint committee of councilmembers and DDA board members was tasked with developing recommendations on Chapter 7 changes. The approach the committee is currently taking is to change conceptually the way that Chapter 7 limits the DDA’s TIF capture. It’s a so-called “dual track” for consideration by the council. The other track is the set of revisions that have already received initial approval.

Under the existing ordinance language, the amount of DDA TIF capture is calibrated to projections in the DDA TIF plan, which is a foundational document for the DDA. The different conceptual approach would establish a basis level for the maximum captured taxable value in the DDA district and then set some clearly defined annual increase, keyed to a specific percentage or some variant of a consumer price index (CPI).

For example, the current taxable value on which the DDA captures taxes is roughly $137,000,000. That yielded about $3.76 million in TIF revenue to the DDA in fiscal year 2013, which ended on June 30. If that $137,000,000 were used as a basis for the cap, then a 3% increase applied annually would give the DDA a maximum of $5.063 million in 2023. In any given year, the DDA would receive the lesser of two values: (i) the unconstrained TIF captured on the taxable value; or (ii) the value of the cap.

A working document used by the joint committee at its Sept. 10 meeting showed two basic scenarios, one with a basis of $137,000,000 in taxable value for FY 2013, and a second one starting with a basis of $167,000,000 for the following year, in FY 2014. The second one received more interest from the committee. Depending on the choice of the escalator, it’s not clear if the cap would ever result in a determination that excess TIF should be returned.

Under the Chapter 7 revisions that have already received initial approval from the council, the approach was essentially to clarify the existing language, which relies on the difference between projected increases in the DDA tax base and the actual increase in the tax base. The new approach would remove that restriction and replace it with a fixed cap, which may or may not have a constraining effect on the DDA’s TIF revenue.

In that context, Sumi Kailasapathy (Ward 1) questioned at the council’s Sept. 16 meeting whether the council had the legal right to change the ordinance in that way – given the existing ordinance language, which reads: “Only after approval of the governmental units may these restrictions be removed.” The response from city attorney Stephen Postema at the meeting was to indicate that he’d provide an assessment of the proposed “dual-track” ordinance changes as a whole before the council was asked to vote.

The city attorney office’s view of the requirement of other governmental unit approval seems already apparent in the draft ordinance revisions that have received initial approval from the council. Namely, the council can alter the ordinance in whatever way it chooses, which would include deleting or altering the key sentence requiring approval of other governmental units. The city attorney’s office helped develop that set of revisions, and if given final approval the key sentence would be altered as follows [deleted text struck through and added text in bold italics]:

Only after approval notice to and the opportunity to comment of by the governmental units may these restrictions be removed.

Before the city council takes up the issue again on Oct. 21, the joint committee is scheduled to meet on Oct. 16 at 4 p.m. in the council workroom on the second floor of the Ann Arbor city hall, 301 E. Huron. The meeting is open to the public, and based on the first two committee meetings, an opportunity for public comment will be provided.

Links

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• [Aug. 11, 2011 letter: AADL to DDA executive director Susan Pollay]
• [Jan. 27, 2012 letter: AADL to mayor John Hieftje]
• [.pdf fixed cap joint committee working document]
• Column: TIF Capture is a Varsity Sport
• Column: Let’s Get TIF Capture Right
• Column: A TIF with A2Y Chamber
• Column: DDA, City Council, No Politics Here

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The sign on the door to the Ann Arbor city council chamber, installed in the summer of 2013, includes Braille.

For both agenda items, the expectation was that council committees would work during the interim period to hammer out a clarified proposal and recommendation for the full council to consider on Sept. 3. In neither case was that committee work accomplished.

After voting at its May 6, 2013 session to postpone a final vote on DDA ordinance revisions until Sept. 3, the council attempted to ensure that the deliberations at the first meeting of the fall would be productive. The council voted on July 1, 2013 to establish a joint council-DDA committee to work out a recommendation on possible legislation. The main point of controversy involves the definition of the DDA’s tax increment finance (TIF) capture.

Already given initial approval by the council is a proposal that would essentially enforce the existing ordinance language. The revision to the ordinance would have an arguably inconsequential impact on TIF revenue received by the DDA – when compared to its most recent 10-year planning document. What makes that comparison controversial, and unwelcome to the DDA staff and board, is the fact that its most recent planning document doesn’t include tax revenue from very recent new downtown construction. The revised ordinance would have a roughly $1 million per year negative impact on DDA TIF revenues – when compared to the amount the DDA would receive if the DDA were allowed to give the existing ordinance language its preferred interpretation.

The charge to the joint committee on July 1 was to begin meeting immediately, but the group did not convene until eight weeks later, on Aug. 26 – after the Aug. 6 Democratic primary election. The outcome of that election left a key vote in place for an ordinance revision that doesn’t favor the DDA – that of Stephen Kunselman (Ward 3), who defeated challenger Julie Grand. Still, DDA board members at the Aug. 26 meeting seemed keen to continue a delaying gambit. That’s because a failure by Jane Lumm (Ward 2) to win re-election in November could tip the balance in the DDA’s favor – even factoring in the addition of Jack Eaton in Ward 4. Eaton, who prevailed on Aug. 6 over incumbent Marcia Higgins, supports the idea of constraining the DDA’s TIF capture.

At the one committee meeting held so far, the only substantive concept that was batted around briefly was the idea of defining some kind of fixed cap on TIF revenue. This approach would replace the existing ordinance language, which calibrates the DDA’s TIF capture with the projections in the TIF plan. But the discussion never went as far as to include dollar amounts for the fixed cap. After about an hour and a half of political squabbling and sometimes inaccurate recitation of historical facts, the general mood among councilmembers seemed to be reflected in a remark by Sally Petersen (Ward 2): “I don’t think we can be there by next week.” So the item looks likely be postponed on Sept. 3. However, the council is free to vote the proposal up or down at this meeting.

The one session of the joint DDA-council committee still exceeded, by one meeting, the council rules committee’s effort over the summer. The rules committee did not meet at all between July 15, 2013 and Sept. 3. On July 15, the council had postponed a vote on new rules, but not before rejecting one of the proposed rule changes, which the committee had first presented on June 17, 2013. The council as a whole was not keen to shorten public commentary speaking turns. So the proposal currently in front of the council would maintain the existing three-minute time limit.

But as the council’s July 15 deliberations on other proposed rules changes threatened to bog down that meeting, Marcia Higgins (Ward 4), chair of the rules committee, encouraged a postponement until Sept. 3. In the interim, the committee – consisting of Higgins, Sabra Briere (Ward 1), Stephen Kunselman (Ward 3), Christopher Taylor (Ward 3), and mayor John Hieftje – was supposed to meet to consolidate input from other councilmembers and perhaps present a clean slate of proposed revisions.

Even though the rules committee didn’t meet, based on comments by Briere and Sumi Kailasapathy (Ward 1) at the Sunday night caucus on Sept. 1, they might push to eliminate all proposed revisions to the rules except for the one that had prompted the rules committee to consider some changes in the first place. The rules changes were prompted by a desire to allow for public commentary at council work sessions – to eliminate any question about whether councilmembers were engaged in deliberative interactions at those sessions. By allowing for public commentary at work sessions, the council would ensure compliance with Michigan’s Open Meetings Act. By enacting that rule change on Sept. 3, the council would be set for a fully deliberative work session on Sept. 9 – which is scheduled to be a joint session with the board of the DDA.

Three other significant items on the Sept. 3 agenda are tied together with an environmental thread. The council will be considering a resolution directing city staff to explore options with the Michigan Dept. of Environmental Quality and with the U.S. Environmental Protection Agency to help to set the clean-up requirements for 1,4-dioxane so that the Pall-Gelman plume is cleaned up to appropriate standards. The council will also be asked to act on a resolution urging the city’s employee retirement system to divest from fossil fuel companies. And finally, the council will consider a resolution directing staff to work with DTE on a pilot program for a “community solar” initiative.

More detail on other meeting agenda items is available on the city’s Legistar system. Readers can also follow the live meeting proceedings on Channel 16, streamed online by Community Television Network. The Chronicle will be filing live updates from city council chambers during the meeting, published in this article “below the fold.” The meeting is scheduled to start at 7 p.m.

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. City administrator Steve Powers is here. Sally Petersen (Ward 2) and mayor John Hieftje are the only members of council who are here.

7:01 p.m. Jane Lumm (Ward 2) won’t be able to be here tonight. She’s looking after family in Pennsylvania. Christopher Taylor (Ward 3) and Margie Teall (Ward 4) are now here. Chuck Warpehoski (Ward 5) and Sumi Kailasapathy (Ward 1) have now arrived.

7:03 p.m. Stephen Kunselman (Ward 3) and Mike Anglin (Ward 5) have arrived, as has Sabra Briere (Ward 1).

7:07 p.m. And we’re off.

7:08 p.m. Pledge of allegiance, moment of silence and the roll call of council. Absent tonight are Jane Lumm (Ward 2) and Marcia Higgins (Ward 4).

7:08 p.m. Proclamations. Three proclamations are on tonight’s agenda. The first one honors disability community activist Lena Ricks. Her passing was highlighted at the last meeting of the Ann Arbor Area Transportation Authority during public commentary. On that occasion, Carolyn Grawi, director of advocacy and education for the Ann Arbor Center for Independent Living, described Ricks as a long-time local advisory council (LAC) member for the AAATA. The LAC is a group that provides input and feedback to AAATA on disability and senior issues. Grawi described Rick’s hard work and devotion to disability rights. She described Ricks as the “matriarch of the disability movement,” beginning with work almost 40 years ago.

The second proclamation recognizes Dawn Farm’s 40th anniversary. Dawn Farm is a nonprofit offering both residential and out-patient services supporting recovery for alcoholics and drug addicts. The organization was founded in 1973 by Gary Archie and Jack Scholtus in a rented old farmhouse on Stony Creek Road in Ypsilanti. The organization has grown to include facilities in downtown Ann Arbor.

The third proclamation honors Bill Kidd for volunteering in Ann Arbor’s parks and natural areas. The proclamation mentions pruning, weeding, monitoring street and park trees through the Citizen Pruner Program and removal of invasive species as activities Kidd has helped with.

7:11 p.m. The proclamation honoring Lena Ricks has been given. It’s met with a round of applause. A family member is expressing her appreciation, calling Lena Ricks a “very dear advocate” for those with disabilities.

7:12 p.m. Representatives of Dawn Farm are now at the podium to receive the proclamation. They include one of the founders – Jim Balmer, who serves as president – as well as Janis Bobrin, former water resources commissioner for Washtenaw County. Bobrin is on the nonprofit’s board of directors.

7:17 p.m. Now at the podium is Bill Kidd to receive his proclamation for volunteering in the city parks and natural areas preservation program.

7:17 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.]

Signed up tonight, with topics in parens, are Thomas Partridge (Martin Luther King Jr. freedom march), Jim Mogensen (Downtown Development Authority ordinance) Roger Rayle (cleanup criteria for the Pall-Gelman 1,4-dioxane plume), Jeff Hayner (environmental issues), Mike Shriberg (fossil fuel company divestment), Monica Patel (fossil fuel company divestment), Mark Koroi (council rules revisions), and Henry Herskovitz (weekly demonstrations at Beth Israel).

7:21 p.m. Partridge introduces himself as a 2010 senate candidate and 2012 candidate for the Michigan house of representatives who’s now a write-in candidate for Ward 5 city council this year. He speaks as an advocate supporting Martin Luther King Jr.’s agenda. Partridge calls for emphasis on affordable housing, public transportation, and fair access to public meetings. He calls for 3- to 5-minute public participation time. There should be no reductions in the amount of time offered to the public, he says. A forward-looking city council would look for new ways to increase public participation time, he concludes.

7:25 p.m. After Partridge’s remarks, mayor John Hieftje tells those holding signs to move to the sides of the room in accordance with the council rules. Mogensen is categorizing Michigan cities, based on their challenges. Ann Arbor tries, as does the general public, to deny these challenges exist. Some people blame liberals for spending money. He alludes to the old quip about Ann Arbor during the football season: “Fake left, run right.” The basic idea is to make the city function well.

7:28 p.m. Rayle introduces himself as chair of Scio Residents for Safe Water. He speaks in support of the resolution on the agenda calling on the Michigan Dept. of Environmental Quality to tighten up the standards for the Pall-Gelman 1,4-dioxane cleanup. When the standards were loosened back in 1985, he says, it happened overnight. He notes that this doesn’t have to be the last resolution on this topic. He’s glad that the council’s attention is back on this topic. Ann Arbor’s water system could eventually be threatened, he says, and a “new hit” was recorded on a well where nobody expected it. He describes his work with GoogleEarth to show how the plume has spread. He calls on Gov. Rick Snyder to get involved and to get the MDEQ straightened out as well as the state attorney general’s office.

7:31 p.m. Hayner, who’s running as an independent for city council in Ward 1 against incumbent Democrat Sabra Briere, is now at the podium. He talks about the balance between vision and common sense. He speaks in support of the community solar resolution. He also speaks in support of the divestment of fossil fuels companies, but urges caution and warns of possible losses. Is social gain worth the risk? he asks. He thanks Rayle for speaking about the 1,4-dioxane resolution. It’s a complex problem that is not going away, he says.

7:34 p.m. Shriberg is speaking on behalf of the city’s energy commission. He asks the council to support the community solar resolution and the fossil fuel divestment resolution. He mentions Seattle, San Francisco, State College and Boulder as examples of cities that have divested. He describes the increased financial risk as minimal.

7:35 p.m. Patel is now supporting the resolutions on community solar and fossil fuel divestment on behalf of the Ecology Center. She gives the council petitions signed by Ann Arbor residents.

7:38 p.m. Koroi reminds councilmembers that he’d spoken to the council previously on the topic of public commentary at working sessions. He says he wants to see the issue taken care of. He notes that Higgins is not here and calls her “the invisible woman.” More public commentary means that the council will hear more from Partridge and Blaine Coleman, Koroi says, adding that the U.S. Constitution must be upheld. He says the Michigan Open Meetings Act should be upheld.

7:41 p.m. Herskovitz cites two news articles about the protests in front the Beth Israel Congregation on Washtenaw Avenue. He notes that at the previous council meeting, the council had been asked to express its displeasure about the protests. He objects to comments made by mayor John Hieftje and other councilmembers. Herskovitz reports that three days ago, someone had spat on a protestor. A police officer had come out to investigate and to view video of the incident, he says.

7:42 p.m. Council communications. This is the first of three 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.

7:42 p.m. Sabra Briere (Ward 1) is giving an update on the work of the North Main Huron River Corridor task force’s work. Their final report has been submitted. The report includes some before-after photos depicting possible improvements, like a pedestrian bridge across the Huron River connecting the Argo berm to the MichCon property. The task force was established at the council’s May 7, 2012 meeting, and had been due at the end of July. But Briere had apprised the council at previous meetings of the slight delay.

7:43 p.m. Briere apologizes for the delay in the delivery of the report. She hopes there will be a presentation at the next council meeting on Sept. 16. Briere also reports that the D1 zoning review could be delayed. More public meetings have been added than were originally planned.

7:47 p.m. Petersen announces that on Sept. 15 at 1 p.m. a Sensory Garden will be dedicated at Liberty Plaza – the downtown park at Division and Liberty. It’s a project of the Ann Arbor commission on disability issues, in collaboration with the city’s adopt-a-park program and the University of Michigan Matthaei Botanical Gardens. A ceremony will be held to honor former commissioner Pamela Baker-Trostle.

7:47 p.m. Kailasapathy reports that she’s been working with staff on getting a report from a professional traffic engineer regarding the recommendation for the city’s crosswalk ordinance. She indicates that she might bring forward a resolution at the next meeting calling for an independent review of the crosswalk ordinance and the associated infrastructure.

7:48 p.m. City administrator Steve Powers indicates that he’ll be providing an update to the council on the review of the new crosswalk ordinance, and of the sanitary sewer overflow in the Arboretum at the start of the weekend. He describes some praise from a resident on Lincoln Street who was pleased with the performance of the Ann Arbor fire department earlier today.

7:49 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. Only one public hearing appears on the agenda tonight. It’s a proposal to build a new Hampton Inn at 2910 Jackson Ave., across the street from Weber’s Inn. The proposed four-story hotel, located on an 8.8-acre site north of Jackson and south of I-94, would include 100 bedrooms and 51,608 usable square feet. A 163-room Clarion Hotel stands on the same site, east of the proposed new hotel.

The planning commission gave this “planned project” a recommendation of approval at its July 2, 2013 meeting. Commissioners had discussed the proposal at length during their June 18, 2013 meeting. Ultimately, they unanimously voted to postpone action at that meeting, instead asking the developer to address concerns over pedestrian access within the site. The planned project status is being sought that the existing foundation can be used. In 2008, when an earlier site plan had been approved, but nothing beyond the foundation built, no maximum front setback had been required. Now, however, a maximum front setback of 50 feet is required on at least one of the site’s three front property lines. A planned project status would allow that requirement to be waived.

A drawing of the proposed Hampton Inn on Jackson Avenue – next to the larger existing Clarion Inn – was shown to commissioners at their July 2 meeting. The design includes improved pedestrian features.

7:51 p.m. Thomas Partridge is speaking on the Hampton Inn planned project site plan. He says he’s wary of the planning commission’s approval. We don’t want more pedestrian casualties or deaths, he says. Many people use this stretch of Jackson Road to deliberately speed, he contends.

7:54 p.m. Andy Wakeland with Giffels-Webster Engineers of Washington Township, Mich., – the civil engineer for the Hampton Inn project – is now addressing the council. He discusses the pedestrian issues. He calls it a pedestrian-friendly site and says, “We’re pretty proud of it.” The architect for the project is now addressing the council. He recalls how the project was started several years ago, and the foundations had been completed. In the interim, the city changed its zoning ordinance, and those concerns had to be addressed. He notes the planning commission voted 8-0 to recommend approval.

7:54 p.m. Minutes and 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 just one consent agenda item. It’s a resolution to accept the board of insurance administration minutes of Aug. 15, 2013, and to approve workers’ compensation coverage – through Accident Fund Insurance Company of America ($56,192) and an agreement with CompOne Administrators for third party administrative services ($28,000).

7:55 p.m. Councilmembers can opt to select out any items for separate consideration. No one separates out the single item.

7:55 p.m. Outcome: The council has approved the consent agenda.

7:55 p.m. DDA ordinance revision. The ordinance proposed to be changed is Chapter 7 of the city code, which regulates the way the tax increment finance (TIF) capture of the Ann Arbor Downtown Development Authority is calculated. Up until two years ago, the existing limitation expressed in the ordinance had never been applied. But in May 2011, the city treasurer called the issue to the DDA’s attention, characterizing it as a roughly $2 million issue, dating back to 2003.

However, when the DDA retroactively calculated its revenue, as well as rebates to other taxing jurisdictions, it applied a methodology chosen to minimize the amount of “rebate” owed to other taxing jurisdictions, reducing the amount to roughly $1.1 million. When challenged on its method of calculation, the DDA subsequently reversed its position, claiming that the money it had already paid back to other taxing jurisdictions was a mistake. The DDA’s new position was to claim an interpretation of a clause in Chapter 7 as providing an override to limits on TIF revenue – if the DDA has debt obligations, which it does. So in 2012 and 2013 the DDA did not return any of its TIF capture to other taxing authorities.

The proposal to revise the ordinance, as approved at first reading by the council on April 1, 2013, would essentially enforce the language that’s already in the ordinance, but disallow the DDA’s interpretation of the “debt override” clause. Compared to the DDA’s own 10-year planning document, revenue to the DDA under the ordinance change would be roughly similar:

Ann Arbor DDA TIF revenue projections. The vertical line indicates the year when the clarified calculations would be implemented. The red line is the amount of TIF revenue assumed by the DDA in its FY 2014 and FY 2015 budgets, and in its 10-year planning document. The blue line is the estimated TIF revenue under the proposed clarified ordinance calculations. The yellow line is the estimated TIF revenue that the DDA would receive if the DDA continued to interpret the city’s ordinance in its own way. (Numbers from the city of Ann Arbor and DDA. Chart by The Chronicle.)

However, the 10-year planning document in question did not include a large amount of new construction in the downtown area, that has already generated higher TIF revenue than in the 10-year plan. The ordinance revision also includes term limits for DDA board members, and would make the appointment of the mayor to the board of the DDA contingent on a majority vote of the council. Without majority support, the mayor’s spot on the board would go to the city administrator.

The council voted at its May 6, 2013 session to postpone final consideration of the ordinance revision until Sept. 3. At its July 1, 2013 meeting, the council voted to establish a joint council-DDA committee to work out a recommendation on ordinance revisions. The charge to the committee was to begin meeting immediately, but the group did not convene a meeting until eight weeks later, on Aug. 26, leaving only one week before the meeting when the item was next scheduled to appear on the council’s agenda. The general mood at the committee meeting was that the vote should again be postponed.

7:57 p.m. Kunselman leads off, recalling the history of the proposal, mentioning the meeting of the committee on Aug. 26. Not enough information was available, he says. Staff has been directed to come up with draft language. He says he wants to postpone again, so the committee can meet again and bring it back with something that has more substance. The proposal is to postpone until Oct. 7.

8:00 p.m. Petersen says she might be out of town at that meeting. Kunselman asks Powers if draft language could be ready for the Sept. 16 meeting. Powers indicates that the upcoming work session will have the parking agreement as its topic. He ventures it could be a challenge to schedule that many people to meet. Hieftje suggests postponing until the next meeting and assessing how things stand then.

Kailasapathy says that she’d requested that Chapter 7 be included in the city audit and the answer that had come back was that the ordinance language was not clear. Briere asks if the DDA needed to be able to vote on something before the council acted. Hieftje says no.

8:01 p.m. Outcome: The council has voted to postpone the DDA ordinance until its next meeting, on Sept. 16.

8:01 p.m. Shell/Tim Hortons revised PUD. The council is being asked to consider changes to the supplemental regulations for a PUD (planned unit development) for the Shell station and Tim Hortons at the northeast corner of Ann Arbor-Saline Road and Eisenhower Parkway. It’s a 1.44-acre site.

The changes to the PUD regulations would allow for a drive-thru restaurant within the existing convenience store, where a Tim Hortons is already located. The project includes constructing a 109-square-foot drive-thru window addition and access driveway on the north side of the building. Access to the drive-thru lane would be off of the site’s existing entrance from Ann Arbor-Saline Road. A PUD had previously been approved by the council at its July 2, 2012 meeting, but without plans for a drive-thru restaurant. The city planning commission had unanimously recommended approval of the request at its July 16, 2013 meeting.

8:04 p.m. Warpehoski asks for a representative of the project to come forward. He says that the area plan doesn’t support a car wash. That possible use was left in, and Warpehoski would like it removed. The developer’s representative doesn’t have any objection. Warpehoski also wants to strike the language that describes the ability for someone to get food and beverage without leaving their vehicle as a public benefit. He describes going through the drive-thru as getting a “salt-sugar-fat fix.” He also doesn’t like the idea of describing the drive-thru as a “gateway.”

8:09 p.m. Teall is now asking questions of the developer’s representative. All he’s asking for is a small drive-thru window, he says. Teall wants to make sure the design of the window fits the architecture. The developer is proud of what the building looks like.

Briere recalls the planning commission discussion. [She serves as the council's representative on the commission.] She asks for an explanation of why the seating area is an appropriate place for such an area. He says the location can be a welcoming symbol, a gateway, so to speak. At the citizens participation meeting, they were told there was quite a bit of pedestrian and bicycle traffic, so the seating area was thought to be a good amenity. Briere asks city planning manager Wendy Rampson to come to the podium. She asks Rampson to comment on the number of residents in the area. Rampson indicates that there are a lot of people who cross through the area. So there’s a lot of pedestrian travel, in addition to the auto travel, Rampson says.

8:11 p.m. Briere says that the confusion is resulting from the fact that there’s a list of eight items and it’s not clear if each item is a discrete benefit. So she had no problem removing an item from the list. Briere asks Rampson to explain how it’s determined what counts as a public benefit for the purpose of evaluating a PUD.

8:14 p.m. “It’s fairly unusual to have a gas station PUD,” Rampson says. The property was originally owned by the school district, she reports. She said that the planning commission felt that as a whole, the items were felt to be a benefit. Kunselman asks about the iterations of the PUD. Did more public benefits get added to the list each time? Kunselman questions whether an amendment to a PUD really requires an additional benefit above and beyond the original public benefit.

8:17 p.m. Kunselman says if the word “gateway” were removed, he’d be fine with everything else. Rampson reports that the owners have expressed concern about making a substantive change, which would require additional readings. City attorney Stephen Postema ventures that the proposed change by Warpehoski isn’t substantial.

Briere says that the advantage of putting items in the PUD language is that the developer can be held accountable for those items.

8:18 p.m. Teall appreciates Briere’s remarks about accountability. She doesn’t have a problem with stating more benefits or with the word “gateway.” She appreciates the attention to detail the developer is giving the project. She won’t support Warpehoski’s amendment to the language. The property is located in Ward 4, which Teall represents.

8:21 p.m. Hieftje says he doesn’t think the change is substantial. Petersen says that she thinks it’s important to consider the gas station as a gateway. She says that Tim Hortons has healthy choices on its menu. Anything that helps beautify the corridor should be supported, Petersen says.

Warpehoski suggests separating the amendment into the part about the car wash and the part about the benefits.

8:23 p.m. Outcome on the benefits language: The council has approved that amendment over dissent from Teall, Anglin, and Petersen.

8:24 p.m. Outcome on “car wash”: The council has approved the elimination of the word “car wash.”

8:24 p.m. Outcome on changes in the Tim Hortons/Shell PUD: The council has voted to give initial approval to the PUD changes. The council will need to vote again at a subsequent meeting, after a public hearing, to give the changes final approval.

8:25 p.m. Resolution to approve the 2013 city council rules. This revision to the set of council rules was first presented to the council on June 17, 2013. A vote was postponed at that meeting. The revisions were prompted by a desire to allow for public commentary at council work sessions – to eliminate any question about whether councilmembers were engaged in deliberative interactions at their work sessions. By allowing for public commentary at work sessions, the council would ensure compliance with Michigan’s Open Meetings Act.

However, the council’s rules committee recommended additional changes, including a shortening of the individual speaking turns for public comment as well as for councilmembers. And those additional changes were included in the June 17 version of the rules. After again postponing a vote at its July 1, 2013 meeting, the council used its following meeting, on July 15, 2013, to eliminate one of the proposed rule changes – the shortening of public speaking turns. But the council postponed further revisions and a vote until Sept. 3.

The council’s rules committee – consisting of Marcia Higgins (Ward 4), Sabra Briere (Ward 1), Stephen Kunselman (Ward 3), Christopher Taylor (Ward 3), and mayor John Hieftje – was supposed to meet before the Sept. 3 meeting to consolidate input from other councilmembers and perhaps present a clean slate of proposed revisions. However, in the interim, the rules committee did not meet. It’s possible that at tonight’s meeting the council will reduce its focus to the original issue – public commentary at work sessions – and leave any further revisions to the newly composed council in November.

8:28 p.m. Taylor suggests postponement. Warpehoski asks if postponement would preclude allowing public commentary at the Sept. 9 meeting. City attorney Stephen Postema indicates that it wouldn’t be precluded. Warpehoski asks that a postponement include direction to notice the public that public commentary will be provided and that it be added to the work session agenda.

Kailasapathy asks if signing up will be required. Postema indicates that he imagines it will simply be general time. Without the rule change, Postema claims there’s nothing in the council rules about the agenda for work sessions.

8:29 p.m. Outcome: The council has voted to postpone the change to council rules, but will allow public commentary at its next work session.

8:29 p.m. Resolution on cleanup criteria for 1,4 dioxane plume. This resolution would direct the city administrator and city staff to explore actions available to the city, including meeting with the Michigan Dept. of Environmental Quality and petitioning the U.S. EPA to help set cleanup criteria for the carcinogen 1,4-dioxane in Michigan, including the Pall-Gelman plume and without site specific criteria for the Pall-Gelman plume.

The history of Gelman Sciences, which caused the 1,4 dioxane contamination, goes back 40 years. The MDEQ’s current 1,4-dioxane generic residential drinking water cleanup criterion was set at 85 parts per billion (ppb). But the EPA’s criterion set in 2010 was for 3.5 ppb. The MDEQ was supposed to re-evaluate its own standards by December 2012, based on the EPA’s 2010 toxicological review. It missed that deadline, and according to the council’s resolution, is anticipated to miss a new deadline set for a year later in December 2013.

Here’s a map of the plume. The yellow region is estimated plume area where the 1,4-dioxane concentration is greater than 1 ppb. That area encroaches well into the city of Ann Arbor and extends outside the well prohibition zone (red border).

Map of Pall-Gelman 1,4-dioxane plume. Map by Washtenaw County. Back arrow added to indicate baseball field at West Park.

8:33 p.m. Briere is describing the chemical properties of 1,4-dioxane. She describes the long history of the problem. Some people have voiced concern that the people who have been involved in advocacy should have been involved in the drafting of the resolution – specifically, the Coalition for Action on Remediation of Dioxane (CARD). She agrees. She says she has a substitute resolution she wants the council to consider. She describes the changes as minor. There’s an added “whereas” clause. Briere says that MDEQ is eager to talk to the city about the issue and welcomes the resolution.

8:40 p.m. Hieftje indicates that the city’s lobbyist, Kirk Profit, has been working hard to keep the issue in front of the state. Teall thanks Briere and Warpehoski for their work on the resolution. She’s glad there might be movement on the part of the MDEQ.

Petersen complains that the resolution came to the council just late last week. The resolved clauses don’t “have enough teeth,” she says. The language could be strengthened by defining specific criteria and to define the goals and consulting the expertise of CARD members. She wants the resolution postponed.

Briere asks assistant city attorney Abigail Elias to explain the “teeth.” Elias describes the settlement between the city and Pall-Gelman related to the northwest supply well. She’s not sure what might be added. Kailasapathy says she didn’t want to bring up the issue, but as long as Petersen has done so, she’s going to pursue it. She describes herself as a social scientist turned CPA and values the input of more people. She has mixed feelings about the process. Petersen indicates she wants to move to postpone. Hieftje asks city environmental coordinator Matt Naud to the podium.

8:41 p.m. Hieftje ventures that the resolution is about as strong as it can be made at this time. Naud says the Pall situation is very complicated. CARD has worked hard on the issue and there’s a long list of things they’d like done. What’s clear in this resolution, he says, is that the federal government now thinks 1,4-dioxane is more cancer-causing than the EPA previously thought. The state’s job is to take that and promulgate it under the Clean Water Act, but that hasn’t been done.

8:47 p.m. Naud said that the resolution is a message to the MDEQ. Changing the standard would radically change the attention being paid to the Pall-Gelman site. Michigan has had an 85 ppb standard for a very long time, when everyone else has had a much lower standard, Naud says.

Petersen asks what the risk is in identifying a specific standard. Naud says that he’s not sure what number would come out of Michigan’s algorithm. Naud says that Rayle’s work has in part included hand-entering data from paper copies. Petersen wants to postpone in order to add CARD’s “wish list” to the resolution.

8:50 p.m. Kunselman asks Naud why the state is dragging its feet. Naud says that it’s broader than the 1,4-dioxane issue. He doesn’t really know more than that, he says.

Kunselman asks what the city is doing in the way of contingency planning in the event that a 1,4-dioxane plume reaches Barton Pond. That’s the question that needs to be addressed, he says. “What would we do?” Would we have to filter out the 1,4-dioxane before pumping drinking water to residents? He has no problem postponing or voting on it tonight. But he wants the city to think about what it’s doing itself, as opposed to asking others to do something.

9:02 p.m. Anglin says that the problem is that the courts are generally going to find in favor of Pall-Gelman. He says that when he started serving on the council, he attended some CARD meetings and it was very confusing. Anglin wants to hold a work session on the topic. He points out that the question was asked in connection with the City Apartments project: Who would be responsible if the contamination were to penetrate to that site? Anglin says he’s in favor of postponement because of the magnitude of the issue. But he thanks Briere and Warpehoski for their effort.

Briere says that the odd thing is that it’s not a new emergency. Rather, it’s an ongoing problem. The first step seems to be to get MDEQ to act, Briere ventures. Naud indicates some agreement with that idea. The change at the federal level should have trickled through to the state level, Naud says. Pall-Gelman says that currently they don’t have to worry about areas that have concentrations below 85 ppb.

Briere says she assumed that other councilmembers were already up to speed on the issue. She thought that the opportunity to achieve something should be seized. Naud says that there’s no question that the state should have acted in some way, and that’s why the resolution focuses on that. Petersen asks if the purpose of the resolution is just to put MDEQ on notice. Naud indicates basic agreement. Petersen says that two more weeks shouldn’t be a problem, saying she wants to hear from CARD on this, to see if the language can be strengthened. She moves for postponement.

9:08 p.m. Hieftje says he doesn’t think that the resolution can be strengthened and says that the resolution can provide a start to a conversation. It would give the city’s lobbyist something to work with, Hieftje says. He was impressed that Rayle had been consulted and had spoken in favor of it. Hieftje says he’ll vote against postponement.

Kunselman expresses concern that the city is “going it alone.” Briere says she’s talked to other elected representatives – county commissioners, Scio Township representatives, and members of the state legislature. She says that it’s not Ann Arbor going it alone, but rather Ann Arbor taking the first step. Taking that first step, she says, seems to be vital. She’d attended a briefing with Evan Pratt, Washtenaw County water resources commissioner, and the message at that briefing was that the first step is for MDEQ to change the 85 ppb number.

Taylor asks how things stand in the city. Naud indicates that when 1,4-dioxane was detected in the northwest supply well in 2003, the city stopped using that well.

9:20 p.m. Naud describes various locations where the city tests for 1,4-dioxane. Taylor says that he’s delighted the proposers have brought it forward, saying that the revised version would be a “scootch” more detailed. He says he doesn’t think that a delay of two weeks would matter.

Teall asks about testing locations. There’s a couple hundred monitoring wells, Naud says. Anglin asks about the city’s conversations with the EPA. Anglin asks about the Armen Cleaners site.

Warpehoski says he’s going to violate the council rules by sending the media revisions to the resolution via email. Warpehoski supports the approach that Briere has taken as “more surgical” than to try to hang a bunch of wish list items as if the resolution were a Christmas tree. He summarizes the intent of the resolution as saying, “Do your job!” Warpehoski says that Briere has done a lot of heavy lifting.

9:20 p.m. Outcome on postponement: On a 4-5 vote, the motion to postpone fails. Voting against postponement were Teall, Warpehoski, Anglin, Hieftje and Briere. Lumm and Higgins are absent.

9:26 p.m. Kunselman says he’ll support the motion. He indicates that if the city’s water system were compromised, then Ann Arbor would connect to the Detroit system. Responding to a question from Briere, Naud indicates that he’s not sure that would be the first place the city would go. Kunselman says that it’s important to hear what the contingency plan is.

Kunselman asks what the criteria would be for shutting down Barton Pond as a water source. Powers indicates he’ll follow up on that. Hieftje says that shutting down Barton Pond is not imminent. Briere asks Naud if there’s any imminent risk. Naud replies that the geology is complicated because of the glaciers. There’s a lot of science and research that would need to be done to determine if the plume could get to Barton and if so, how fast. He allows that 1,4-dioxane has shown up in places where it was not expected.

9:26 p.m. Outcome: The council has voted unanimously to direct city staff action related to helping to set cleanup standards for 1,4-dioxane.

9:29 p.m. Street closing for ESPN Game Day. This was added late to the agenda. The request is to close Washington Street between Thayer and Fletcher streets from Thursday, Sept. 5 at 3 a.m. until 9 p.m. on Saturday, Sept. 7.

9:29 p.m. Outcome: The ESPN Game Day street closing was unanimously approved.

9:30 p.m. Disbursements from the Community Events Fund. This was also added late to the agenda. It includes 18 disbursements to nonprofits, mostly in the $1,000 to $3,500 range. The largest one is $25,000 to the Ann Arbor Summer Festival to cover city costs for the Top of the Park event beginning on June 13, 2014.

9:30 p.m. Outcome: The disbursements from the Community Events Fund were unanimously approved.

9:30 p.m. Recess. The council is now in recess.

9:43 p.m. The council has returned from recess.

9:43 p.m. Hampton Inn planned project. The proposed four-story hotel, located on an 8.8-acre site north of Jackson and south of I-94, would include 100 bedrooms and 51,608 usable square feet.

9:47 p.m. Warpehoski asks city planning manager Wendy Rampson to answer questions. He asks if there’s any plan to install signalization of crosswalks like HAWK or rapid flashing beacons. No, she says. He asks for some explanation of the traffic analysis. Rampson reports that city planner Jill Thacher and traffic engineer Pat Cawley had visited the site. The location of the crossing was the best one available, Rampson says. Warpehoski ventures that of the bad options, he can see how this could be the best one. But as consultations with MDOT and as the project goes through the building permit phase, he’d like attention paid to the issue and urges that every appropriate analysis and protection is put in.

9:49 p.m. Briere says that the planning commission held up the project asking for additional pedestrian amenities within the site. However, the crosswalk had been a part of the initial proposal, she says.

9:55 p.m. Anglin suggests that he and Warpehoski could meet with AAATA staff about the bus stop.

Kunselman asks about the stormwater detention pond. He ventures that the overflow discharge goes to the expressway. Yes, and that will need to be approved by MDOT, says a representative of the developer. Kunselman asks if MDOT will dictate the signage on the crosswalk. Rampson is not sure if the signs would be different from the other signs in the city next to crosswalks.

Hieftje notes that Ann Arbor has the highest hotel occupancy rate in the state.

9:55 p.m. Outcome: The council has voted to approve the Hampton Inn planned project.

9:55 p.m. Resolution to divest from fossil fuel companies. This council resolution is based on an energy commission resolution passed on July 9, 2013. The energy commission recommended that the city council urge the city’s employee retirement system board to cease new investments in fossil fuel companies and to divest current investments in fossil fuel companies within five years.

The resolution defines a “fossil fuel company” to be any of the top 100 coal companies or top 100 gas and oil extraction companies. The top three coal companies on the list are: Severstal JSC; Anglo American PLC; and BHP Billiton. The top three gas and oil companies on the list are: Lukoil Holdings; Exxon Mobil Corp.; and BP PLC.

The basic consideration of the resolution is the importance of the role that greenhouse gas emissions play in global warming. The resolution cites the city of Ann Arbor’s Climate Action Plan, which has a goal of reducing greenhouse gas emissions by 25% by 2025 and 90% by 2050. The resolution warns that fossil fuel companies have enough fossil fuel reserves that, if burned, would release about 2,795 gigatons of CO2. That’s five times the amount that can be released without causing more than 2°C global warming, according to the resolution.

9:58 p.m. Hieftje says that as a member of the energy commission, he could say that the issue had been thoroughly reviewed and researched. Briere refers to Jeff Hayner’s public commentary, which indicated that there could be a financial impact. Have there been any other examples of divestment? Briere asks.

City administrator Steve Powers indicates that the last time it came up was in connection with South Africa. So it was a long time ago. Briere asks Nancy Walker, executive director of the retirement system, to come to the podium. Walker says there would be some financial implications.

10:04 p.m. Outcome: The council vote to urge the city’s retirement system to divest from fossil fuel companies has failed on a 5-4 vote, falling short of the six-vote majority it needed. Voting against it were Kunselman, Teall, Anglin and Petersen. Lumm and Higgins are absent.

10:04 p.m. Resolution to encourage community solar development. This council resolution also stems from an energy commission recommendation – that the council direct city staff to work with DTE to develop a “community solar” pilot program, which would allow people to invest in a solar energy system, even if the energy that’s generated would be located off-site from their own electric meter.

The goal is to create a program that would assist the work of the Great Lakes Renewable Energy Association (GLREA), which has a grant to work statewide, investigating the feasibility of and constraints facing this collective approach to alternative energy generation. As an example of this approach, the resolution cites the Cherryland Electric Cooperative in Traverse City. The council’s resolution asks that details of a pilot program be ready for consideration by the Michigan Public Service Commission by March 31, 2014.

The goal of community solar is to allow people who don’t own the property where they live, or whose own property is shaded or poorly oriented for solar energy production, to support the production of solar energy.

10:04 p.m. Outcome: The council has voted to direct staff to work with DTE to develop a community solar pilot program.

10:04 p.m. Resolution to approve the purchase of development rights: Sheldon and Wolf property. This resolution would add land to the city’s greenbelt program, which is funded by a voter-approved millage. The 20-acre property is located in Webster Township. It’s further described in the staff memo accompanying the resolution as located on Zeeb Road, next to active farmland and other property that has already been protected by the city’s greenbelt program.

The purchase price, after deducting a $6,500 landowner donation, is $47,500. Webster Township is contributing $2,000 and Cherry Republic is contributing another $2,300, leaving the city’s share of the purchase price at $43,200. Due diligence, closing costs and a contribution to the endowment brings the city’s total contribution to $82,067.

The Sheldon and Wolf property is indicated in red. The green highlighted area denotes area already protected as a part of Ann Arbor’s greenbelt program. The heavy green line is the boundary encompassing eligible properties. This is the northwest corner of the boundary area.

10:04 p.m. Outcome: The council has voted to approve the acquisition of development rights on the Sheldon and Wolf property.

10:04 p.m. Resolution to approve participation agreement with Washtenaw County Parks and Recreation. This resolution would authorize the city to participate in the acquisition of two pieces of land owned by DF (Domino’s Farms) Land Development LLC. The appraised value of the land is $322,000, of which the city would contribute up to $32,200. The lead agency on the deal is the Washtenaw County parks & recreation commission, which voted to approve the purchase of the two parcels at its Aug. 13, 2013 meeting. And the city’s greenbelt advisory commission recommended the city’s participation at its July 11, 2013 meeting.

10:04 p.m. Outcome: The council has voted to authorize the city’s participation in the acquisition of the Domino’s Farms land.

10:04 p.m. Resolution to approve Suntel Services agreement. The agreement would be for three years for telecommunications maintenance and support at an annual cost of $189,491. The memo accompanying the resolution describes the telecom systems covered by the agreement as “mission critical.” That includes the five phone servers, which process all incoming and outgoing city phone calls. It’s the same system shared by the Ann Arbor Area Transportation Authority – so the AAATA will be billed $7,238 annually for its share of the contract.

10:04 p.m. Outcome: The council has voted to approve the Suntel agreement.

10:04 p.m. Resolution to award purchase orders for utility infrastructure components. The two purchase orders would go to ETNA Supply ($167,883) and HD Supply ($163,913). According to the staff memo, the kind of parts included are “valves, brass saddles, various sizes of replacement pipe, fire hydrants, hydrant repair parts, service line connectors, main line connectors and accessories required to repair and maintain the water delivery system.”

10:05 p.m. Outcome: The council has voted to approve the purchase orders for utility system parts.

10:05 p.m. Confirmation of appointments. The council was originally going to be asked to confirm four nominations made at the council’s previous meeting on Aug. 19, 2013: Leigh Greden’s reappointment to the Ann Arbor housing commission; Al McWilliams’ appointment to the Ann Arbor Downtown Development Authority; Devon Akmon’s appointment to fill a vacancy on the public art commission; and Logan Casey to fill a vacancy on the human rights commission.

However, the list was updated around 2:30 p.m. today, omitting Greden’s name. The outcome of a possible vote on Greden’s confirmation was dubious. Both Greden’s and McWilliams’ nominations had come forward from mayor John Hieftje with some wrinkles. On April 1, Nickolas Buonodono had been nominated to replace Leigh Greden on the Ann Arbor housing commission (AAHC) board, after Greden had reached the end of a term. Buonodono is an attorney, and member of the Washtenaw County Democratic Party executive committee. However, that nomination was not on the council’s April 15 meeting agenda for confirmation.

According to AAHC executive director Jennifer Hall, who spoke to The Chronicle in a telephone interview in mid-April, Greden was going to seek reappointment for a second term if he could accommodate his schedule to the meeting times. So Greden’s nomination on Aug. 19 appeared to indicate that scheduling issues had been resolved. The housing commission is poised to undergo a major transition to a project-based voucher system, which the council authorized at its June 3, 2013 meeting, on a unanimous vote. An argument for Greden’s continued service on the board could have been made based on the importance of continuity among board members familiar with the intricacies of the transition.

Before McWilliams was nominated at the council’s Aug. 19 meeting, his name had appeared on an early version of the list of nominees for the council’s Aug. 8 meeting. The final version of the list for that meeting, however, did not include his name. McWilliams is founder of Quack!Media, an ad agency located in downtown Ann Arbor. Quack!Media lists the Ann Arbor Area Transportation Authority on its website as one of its clients. McWilliams has written advocacy pieces for bicycling on his blog.

Akmon is an Ann Arbor resident and the new director of the Arab American National Museum in Dearborn. Casey is a graduate student at the University of Michigan.

10:07 p.m. Hieftje says that there are some openings on the DDA. He asks for the council’s support on tonight’s nomination. He wanted to find someone representing the Main Street business district and the entrepreneurial community.

10:13 p.m. Kailaspathy is speaking to McWilliams’ nomination. She’d asked for a list of those who’d applied for the appointment to the DDA. She’d been told that the person in charge of the list was on vacation but the list would be provided next week.

The second issue, she continues, is that McWilliams’ company is a vendor for the AAATA. The DDA grants money to the AAATA, she says, calling that a conflict of interest.

Hieftje says that his assistant is in fact out of town, and he had not had time to “rustle up those files.” Hieftje says that the process is that the mayor makes nominations. He’d wanted to nominate McWilliams after reviewing the applications on file. Hieftje noted that there is another seat open on the DDA board and that he’d be looking forward to bringing a nomination to the council’s next meeting.

Briere reports that she’s asked the city attorney about the conflict-of-interest question. It’s less clear that there’s actually a conflict, Briere says. She asks city attorney Stephen Postema to comment on the question. Postema essentially indicates that he doesn’t think there’s an inherent conflict, but if an issue arose that could be dealt with when it came up.

10:18 p.m. Postema stresses that if there are two public entities involved, it’s not considered to be a conflict under the statute. Petersen says that even though the state doesn’t define it as a conflict, the council has rules on the question. She doesn’t think the state law is stringent enough. She ventures that McWilliams would need to recuse himself quite frequently, possibly including votes on the DDA budget.

Postema stressed again that the state statue is not as stringent as many people would like it to be. Postema says Petersen might perceive a conflict but that he’s looking at it as a matter of state law.

Taylor argues that there’s no conflict here at all. He gives employees of the University of Michigan on the council as an example. Using the same standard would require the recusal of councilmembers on any UM-related matter, Taylor says. If there’s an actual conflict on a particular occasion, then it’s well established that someone can simply stand down for a particular vote, Taylor continues.

10:24 p.m. Kunselman asks if the other nominations can be separated out. Hieftje proposes voting on confirmations of Akmon and Casey.

10:25 p.m. Outcome: The council has voted to confirm Akmon to the public art commission and Casey to the human rights commission.

10:30 p.m. Kunselman says he appreciates the issue being raised of the appearance of conflict, even if there’s not a legal conflict. He asserts that he has the prerogative to vote as he likes. So Kunselman is interested in a candidate who might be able to accept some reform. He doesn’t think that McWilliams, as a DDA supporter, will be open-minded with respect to following city ordinances. So Kunselman says he will vote against the appointment of McWilliams.

Hieftje asks Kunselman if he’s met with McWilliams. No, Kunselman says, but he’s read McWilliams’ public statements.

Briere says she has not met with McWilliams, but she’d talked with Maura Thomson, director of the Main Street Area Association, who was very enthusiastic about McWilliams being appointed. Briere is now talking about the issue of perceived conflict of interest. Briere says she’s heard that she could have a conflict due to her spousal relationship. She’d heard that she’d had a conflict when she worked for a nonprofit that received city funding. If the council gets interested in the question of whether someone is even just “dimly friendly” with someone, then that will shrink the pool of those who are eligible to serve, Briere says.

10:38 p.m. Briere says that there were two former mayors who were UM faculty. She was surprised that people are considering this kind of thing to be a conflict. If a councilmember feels a nominee falls short of the mark, then they should be voted against based on the merits, she said.

Taylor adds that if one of the goals is to have people who are involved in local business to be involved in civic life, then this level of relationship can’t be a prohibitive factor. The council’s conversation tonight is already doing damage to the possibility that others will want to step forward, he said.

Warpehoski says there are three questions: qualifications, perspective, and conflict. He’s not upset that the council is discussing any of them. Warpehoski says that he’s met McWilliams only once. He says McWilliams has a sharp mind. So Warpehoski says McWilliams is qualified. Warpehoski isn’t sure of the perspective, except what Kunselman has reported. On the question of conflict, Warpehoski says that McWilliams should not vote on contracts that his company would serve. He doesn’t think there would be that many votes that fit that description. He thinks that the question of conflict is still a fair one to ask.

10:44 p.m. Teall says that she’s supportive of McWilliams’ nomination. Responding to Kunselman’s point about McWilliams’ attitude towards the DDA, Teall says that it’s natural that someone who wants to serve on the DDA would be supportive of the DDA. Kailasapathy is skeptical that there would be only a few votes that McWilliams would need to refrain from. She says she thinks there’s a direct conflict of interest.

Hieftje asks for the ability to withdraw the nomination, so that some of the issues that have been raised can be explored.

10:45 p.m. Outcome: The council has not voted on McWilliams’ nomination because Hieftje has withdrawn it. The council’s vote looked like it would have risked failing on a 5-4 vote with Kunselman, Petersen, Kailasapathy, and Anglin possibly voting against it.

10:47 p.m. Council communications. Hieftje says that an October work session will include representatives from the southeast Michigan regional transit authority (RTA).

Kunselman says he’ll be bringing forward a resolution that rescinds the memorandum of understanding between the city and the University of Michigan in connection with the Fuller Road Station.

10:47 p.m. Public commentary. There’s no requirement to sign up in advance for this slot for public commentary.

10:55 p.m. Kai Petainen thanks the council for the Pall-Gelman 1,4-dioxane resolution. But he calls it insulting that some councilmembers weren’t aware of the issue, asking them where they’ve been. He compliments the city for its disclosure of the raw sewage spill recently. He says it doesn’t make sense to divest from an entire sector of the economy – a reference to the fossil fuel divestment resolution.

Thomas Partridge calls on the council to be aware of the need for greater public participation. He complains that there’s been scant information on a recent murder of a UM student.

10:55 p.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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This panel is from The Chronicle’s monthly comic, Bezonki, which is drawn by local artist Alvey Jones, a partner at the WSG Gallery. Bezonki is really terrible at math, which could explain why stuff is always exploding during his adventures. (This image links to a listing of all of the Bezonki panels.)

However, over the last several weeks, a significant issue has been brought forward for debate that’s been portrayed by some local officials as far more complex than that.

For now, let’s not even think about what the issue might be. It could be zoning. Or dog parks. Or parking rates. Or police staffing levels. Or public art. Or express bus service. Or outdoor signs. Or none of those. Call it Issue X.

As I’ve chronicled the workings of Ann Arbor’s local governance recently, I’ve watched as two local representatives – one elected and one appointed – have seemed to portray Issue X as too mathematically challenging to grasp. I chalk that up to politics: If the math can be set aside, then the conversation can more easily move to pure politics – the strong suit of elected and appointed officials.

To be clear, Issue X is fraught with politics. But I don’t think that focusing on the politics of Issue X serves the interests of Ann Arbor residents.

Issue X is also fraught with mathematical calculations. But not everyone is comfortable with equations.

So in this column I’ll sketch out an analogy that I think, on a purely conceptual level, accurately captures the essence of Issue X – in non-mathematical, non-political terms.

Issue X: The Gas Cards

Imagine a company called CommunityWorks. The company has five frontline employees in the Ann Arbor area: Allison, Ann, Walter, William and Dan. Each employee has a company automobile. The company gives four of the employees a card with a magnetic strip – which they can swipe at the CommunityWorks pump to put gasoline into their automobiles. Using that gasoline, they can drive places to do important work for the company. But Dan is the odd man out. Dan doesn’t receive a gasoline card.

So what is Dan supposed to do for gasoline to keep his car running?

Issue X: How Dan Gets Gas

Dan gets his gasoline using a CommunityWorks company policy, set forth by the CEO. The policy allows Dan to go to the other employees’ cars and extract gasoline from their tanks. So Dan routinely hooks up a hose to Allison’s car – and to Ann’s and Walter’s and William’s – and extracts some gasoline from their tanks.

It’s just a small portion of the gasoline in each tank that Dan extracts. The amount is strictly regulated by a special meter – given to Dan by the CEO and calibrated by Ann’s supervisor. Dan is required to attach the special meter to the gasoline extraction hose whenever he uses it to extract gasoline from someone else’s tank.

The other employees know that Dan is doing this, and they might grumble about it from time to time – because other than Ann, they didn’t have any say in the formulation of the gas hose policy. But they understand that it’s all perfectly consistent with the policy. Still, they sometimes ask Dan where he’s driving with the gasoline he has extracted from their tanks. They ask, because they themselves can’t drive quite as far to do their own work for the company – on account of the gas that Dan takes out of their tanks. So they feel it’s fair to ask Dan to account for where he drives.

And Dan will explain that he’s used their gasoline, for example, to make client visits. And Dan will tell them that this generates more income for the company. And Dan often talks about the fact that he calls on really difficult clients, and convinces those difficult clients to do business with the company. These are the clients that Allison, Ann, Walter and William would probably not otherwise call on, according to Dan.

The company’s employees seem to be mostly satisfied with the arrangement – and they all agree that Dan is a solid employee who makes a positive contribution to the company. Dan is able to make pleasant small talk around the water cooler.

And the other employees think it might be possible that what Dan is saying is true – that Dan is generating additional income for the company, that allows additional gasoline to be put into the pump for the other employees: Allison, Ann, Walter and William.

Issue X: The Special Meter

But one day, as Ann is watching Dan extracting the gasoline from her tank, she notices that Dan has attached the special meter to the hose in an odd way. It looks upside-down to her. And when questioned about it, Dan concedes that it looks upside-down, but says he’s always done it that way. It turns out that Dan’s way of attaching the meter to the hose increases the amount of gasoline that Dan is able to extract from the other employees’ gas tanks.

So Ann says to Dan: I think you ought to attach the meter so that it’s right-side-up. Dan agrees in the future to use the meter in its right-side-up position. And Dan even goes so far as to put back some gasoline into the other employees’ tanks based on the excess amounts he’s previously extracted.

But then Allison, Walter and William notice something: Dan didn’t use the special meter that the CEO had given him to measure out the amount of gasoline he put back into their tanks. They notice that Dan used a different meter – one that returned to them less gasoline than the company’s meter would have dispensed.

So they question Dan about this. Dan’s response: I’ve hired a mechanic who tells me the technique I’ve always been using to attach the meter to the hose is actually an acceptable way to do it; and, by the way, I didn’t need to put that gasoline back into your tanks in the first place.

Issue X: Resolving the Dispute

Ann’s supervisor – the guy who calibrated the meter – proposes that a safety clamp be added, to ensure that in the future, when the meter is attached to the hose, it’s right-side-up.

Tax Increment Finance (TIF)

I’m guessing that at least some Chronicle readers quickly recognized Issue X as the Ann Arbor Downtown Development Authority tax increment finance (TIF) capture. In terms of Issue X, the city council is Ann’s supervisor.

The council is currently poised to add a safety clamp to the meter that attaches to the DDA’s TIF revenue hose. That safety clamp takes the form of revisions to Chapter 7 of the city’s code, which established the DDA.

When the politics and the math are stripped away – as they are in the CommunityWorks analogy – it’s easy to see why those ordinance revisions received majority support (7-3) when the council took its initial vote on April 1.

And it’s easy to see why city councilmembers who are focused on the substance of the issue, instead of the politics, would support those revisions on April 15. That’s when the council is set to take its second and final vote.

Cast of Characters, Props

A more complete key to the characters in the CommunityWorks analogy:

• gasoline: tax money
• gas card: legal authority to levy a tax
• extracted gasoline from another tank: tax increment finance (TIF) revenue
• gas hose and meter: Michigan’s Downtown Development Authority Act
• inner workings of gas hose meter: Ann Arbor’s DDA ordinance (Chapter 7)
• Allison: Ann Arbor District Library
• Ann: City of Ann Arbor
• Ann’s Supervisor: Ann Arbor city council
• Walter: Washtenaw County
• William: Washtenaw Community College
• Dan: Ann Arbor Downtown Development Authority
• The Mechanic: DDA legal counsel
• CommunityWorks: State of Michigan
• CEO of CommunityWorks:  Michigan state legislature

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Ann Arbor DDA tax increment finance (TIF) capture: Actual valuation (green line) of the increment compared to projected valuation in the DDA TIF plan (blue bars correspond to one of three estimates – pessimistic, realistic, and optimistic).

The Chapter 7 amendments are being proposed by Stephen Kunselman (Ward 3), who’s been joined by Sumi Kailasapathy (Ward 1) in sponsoring them. Kailasapathy’s co-sponsorship might help only incrementally to buffer the proposal against criticism that they’re motivated by Kunselman’s personal political aspirations.

On that theory, Kunselman is proposing revisions to Chapter 7 in an effort to raise his profile – in anticipation of a possible mayoral candidacy in 2014, and to shore up support for his Ward 3 re-election campaign his year. Given that he took out petitions for the 2013 Democratic primary on Nov. 3, 2012 – before the Nov. 6 general election – and collected signatures outside the polls, it’s pretty clear that he’s eager to seek re-election to his council seat. And last time around, in 2011, he campaigned as much against the DDA as he did against either of his two opponents. Kunselman is quoted in the February 2013 issue of the Ann Arbor Observer saying that if mayor John Hieftje runs for re-election next year, he’ll run against Hieftje.

However, on the theory that these proposed amendments are all about Stephen Kunselman and not about good public policy, I figure it’s also reasonable to toss in another possibility. Perhaps Kunselman is trying to raise his profile enough to win local blog Damn Arbor’s current poll as “most attractive councilmember.” The poll includes Kunselman as one of just four nominated councilmembers. It’s not clear to me if the voting is meant to include sartorial choices, but if it does, Kunselman could objectively be considered a natty dresser.

All kidding aside, it would be easy and convenient to dismiss the Chapter 7 amendments as a political ploy, and save the work of understanding some gnarly tax calculations. [You'll have a head start on this if you've read my previous column on the issue: "Tax Capture is a Varsity Sport."]

But I think at least some of the proposed changes to Chapter 7 have considerable merit, independent of Kunselman’s political ambitions. Millions of dollars are at stake. As councilmembers give this proposal initial consideration on March 4, I hope they focus on the tax-related amendments.

The proposed Chapter 7 amendments can be divided into two kinds: (1) those that deal with the calculation of the tax increment finance (TIF) capture by the Ann Arbor DDA; and (2) everything else. For that reason, I think the city council should consider dividing the proposed amendments into separate questions for its consideration. This could pose a parliamentary challenge, because the subset of Robert’s Rules adopted by the Ann Arbor city council does not include “dividing the question” as a proper motion during debate. But even if the division isn’t achieved in a parliamentary fashion, councilmembers would be well served at least mentally to divide the proposed changes this way.

By grouping the Chapter 7 amendments on TIF capture for separate consideration, councilmembers would, I think, have a better chance at understanding the implications.

What are the implications? As proposed in the Chapter 7 amendments, the DDA would, in future years, potentially capture less through its TIF. Compared to the way the DDA currently interprets the ordinance, that potential for FY 2014 would translate into $713,221 less in total capture by the DDA. Of that total, the city of Ann Arbor’s share would be $429,409. The remainder would be distributed to other taxing authorities in the DDA district that have their taxes captured: Washtenaw County ($149,392), Washtenaw Community College ($94,257), and the Ann Arbor District Library ($40,163). For FY 2014, that would still leave the DDA with $3.96 million in TIF capture.

Those calculations are based on the city treasurer’s memo that accompanies the council’s March 4 agenda item. But even if the proposed Chapter 7 amendments were enacted, the city treasurer’s calculations show that for the following year, in FY 2015, the reduced amount captured by the DDA would be just $19,862. And it would leave the DDA with $4.77 million in TIF capture for FY 2015.

Why the difference? It’s because the proposed Chapter 7 amendments still don’t explicitly settle a point of unclarity in the ordinance language, which involves the method of TIF calculation.

It’s this method of TIF calculation that should receive most of the council’s attention as it considers the Chapter 7 amendments. Councilmembers should specifically be focused squarely on this question: Should the TIF calculation be based on a year-to-year method or on a cumulative method?

Pay No Attention to the Politics

Some of the proposed Chapter 7 amendments involve governance of the DDA. For example, if the amendments were enacted, then it would not be possible for an elected official to serve on the board of the DDA. Currently, mayor John Hieftje serves on the DDA board, something that’s allowed for in the state enabling statute for downtown development authorities. And in the past, Sandi Smith served as an elected member of the city council, while also serving on the DDA board. Despite Kunselman’s objections to it, the state statute on incompatible offices explicitly allows for simultaneous service on a city council and the board of a downtown development authority.

The Chapter 7 amendment on board membership wouldn’t take effect until after the November 2014 general election – so even if enacted, it would not require immediate removal of mayor John Hieftje from the board.

Another Chapter 7 amendment involves a policy on use of TIF funds inside the DDA TIF district. Currently, the DDA’s own policy for its housing fund allows the DDA to make expenditures on properties located up to a quarter mile outside the DDA TIF district. That’s based on the idea that investments in housing that are sufficiently near the downtown would have an indirect benefit to the downtown. For example, the DDA had pledged $500,000 in support of Avalon Housing‘s now defunct Near North affordable housing project, which was located on North Main Street, outside the district.

The Chapter 7 amendment would require TIF funds to be spent on projects that directly benefit properties inside the DDA TIF district.

Another Chapter 7 amendment would clarify that the DDA’s annual report has to be filed with the city clerk in early January of each year.

I don’t think it’s necessarily unfair to call this set of changes politically-motivated – but that doesn’t count as an argument against any of them. All these changes are at least worth the council’s consideration.

But if councilmembers have an hour to study and deliberate on all the Chapter 7 changes, then I think they should spend 59 minutes on the changes to the TIF calculations.

Chapter 7 TIF Calculations

I’ll begin with a quick overview of how TIF works generally, followed by the current text of Chapter 7, the history of this specific issue, and why the proposed ordinance changes don’t go far enough to provide clarity.

TIF Calculations: How TIF Works

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

TIF Calculations: Chapter 7 Text

In Chapter 7, three paragraphs bear directly on the way that the TIF calculation is supposed to be performed for the Ann Arbor DDA. I’ve added the paragraph numbering, to help keep things straight, and added italics to highlight some of the points I’ll be making. [.pdf of Ann Arbor city ordinance establishing the DDA]:

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

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

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

Having reviewed old newspaper clippings from the early 1980s, when the DDA was first established, it seems almost certain that ¶1 was included for a specific reason. It was included to provide some assurance to other taxing authorities – in case the newly formed DDA were wildly successful in its mission of spurring private investment in the downtown area. The assurance given in ¶1 was that not just the DDA, but also the other taxing authorities would enjoy an immediate benefit of that possibly unanticipated success. Success is defined in terms of the projected value of the increment as expressed in the TIF plan.

The TIF plan is a foundational document for the DDA. Here’s an extract from the Ann Arbor DDA’s TIF plan from its 2003 renewal [.pdf of DDA TIF plan appendix]:

Extract from the Ann Arbor DDA’s TIF plan table. It shows the projected valuation of the increment on which the DDA’s TIF capture will be based.

The fact that three different estimates of anticipated growth are included in the TIF plan leaves room for disagreement about which estimate – realistic, pessimistic, or optimistic – should be used to calculate the redistribution described in ¶1. But the Ann Arbor DDA’s current legal position is that even under ¶1, no TIF funds need to be distributed to other taxing authorities, given the DDA’s current financial picture.

That legal position is based on ¶3, which the DDA interprets as meaning that no re-distribution to other taxing authorities needs to be made under ¶1, until the total amount of the DDA’s debt payments falls below the amount of its TIF capture. In the FY 2014 budget, adopted by the DDA board at its Feb. 6, 2013 meeting, about $6.5 million is slated for bond payments and interest. That clearly exceeds the amount of anticipated TIF capture in the FY 2014 budget – about $3.9 million. The DDA is able to make those debt payments, because about half of that $6.5 million is covered by revenues from the public parking system. The DDA administers the public parking system under contract with the city of Ann Arbor.

As a side note, I think it’s worth thinking about the text of ¶2 from the perspective of the early 1980s – because ¶2 seems to contemplate a much smaller-scale DDA for Ann Arbor than the one that now exists. It seems to contemplate a DDA that, for a specific project, itself issues bonds – based on the TIF from a specific increment in property values. But after the bond is paid off, then under ¶2, the DDA would no longer capture TIF on that increment. Of course, it could be argued that ¶2 simply doesn’t apply, because bonds for DDA projects are issued by the city of Ann Arbor, not the DDA itself. But by that same reasoning, it’s not clear how ¶3 would provide an argument against re-distribution of TIF to other entities.

In any case, the Chapter 7 amendments to be considered by the council on March 4 would render moot any legal arguments about how correctly to interpret ¶2 and ¶3. That’s because the proposed amendments would completely strike both ¶2 and ¶3.

TIF Calculations: History

I don’t think the proposed elimination of ¶2 and ¶3 from Chapter 7 can be dismissed as a political attack by Kunselman on the DDA.

This issue first arose back in the spring of 2011. The context was the year-long hard negotiations between the DDA and the city over terms of a new contract under which the DDA would manage the city’s parking system. The Chapter 7 issue emerged just as the DDA board was set to vote on the parking system contract at its May 2, 2011 meeting.

When the issue was identified by the city’s financial staff, the DDA board postponed voting on the new contract. The period of the postponement was used to analyze whether the DDA’s obligations under ¶1 could be met – at the same time the DDA was ratifying a new parking system contract, which required the DDA to pay the city of Ann Arbor 17.5% of gross parking revenues.

Initially, the DDA agreed that money was owed to other taxing authorities, not just for that year, but for previous years as well. And the DDA paid a combined roughly $473,000 to the Ann Arbor District Library, Washtenaw Community College and Washtenaw County in 2011. The city of Ann Arbor chose to waive its $712,000 share of the calculated excess.

Subsequently, the DDA reversed its legal position, based on ¶3, and contended that no money should have been returned at all. That decision came at a July 27, 2011 DDA board meeting.

The following spring, during the May 21, 2012 budget deliberations, Kunselman proposed an amendment to the city’s FY 2013 budget that stipulated specific interpretations of ¶3 and ¶1 in Chapter 7, with a recurring positive impact to the city of Ann Arbor’s general fund of about $200,000 a year. Kunselman wanted to use that general fund money to pay for additional firefighters.

Kunselman’s budget amendment last year got support only from two other councilmembers – Mike Anglin (Ward 5) and Jane Lumm (Ward 2). Some councilmembers didn’t feel like they’d had enough time to understand completely what the impact would be on the DDA’s financial picture. During those deliberations, for example, mayor John Hieftje raised the general specter of the DDA not being able to meet its own financial obligations, which would then become the city’s obligations.

Fair enough. Now there’s time. Let’s take enough time to understand what the impact would be on the DDA’s ability to meet its financial obligations. But let us also take time to understand why the proposed changes to Chapter 7 need to provide more clarity than they currently do.

As proposed, the Chapter 7 amendments leave open the possibility of a year-to-year method for calculating ¶1 TIF limits, instead of using a cumulative method. The proposed Chapter 7 amendments provide clarity only about which TIF plan projection to use – realistic, pessimistic or optimistic.

TIF Calculations: Realistic Projections

Beyond eliminating ¶2 and ¶3, the amendments to Chapter 7 to be considered by the council would alter ¶1. The most significant alteration would settle the question about which projections in the TIF plan to use for the ¶1 calculation – in favor of the “realistic” projection. The following language would be inserted:

The authority shall determine the difference between the actual captured value and the adopted tax increment financing plan capture value using the realistic tax base growth calculation identified in the plan for real and personal property for each tax year. Absent designation of a realistic tax base growth calculation in any adopted plan, the application of this section shall utilize the mean of all values illustrated by year.

If the actual captured value exceeds the “optimistic” projection, then it exceeds the “realistic” projection by even more. So compared to a method that uses the “optimistic” projections, a method using the “realistic” projections would result in the DDA redistributing more TIF back to the taxing authorities. It wasn’t accidental that when the DDA calculated the amounts it redistributed in 2011, it used the optimistic growth projections in the TIF plan.

TIF Calculations: Cumulative, Year-to-Year

Based on the proposed Chapter 7 revisions, the city treasurer’s memo includes the following calculations, presumably based on certain assumptions about when currently in-progress construction projects will be completed. The severe abbreviations are mine. In order in the table below are the city of Ann Arbor, Washtenaw County, Washtenaw Community College, and Ann Arbor District Library. The rate of the total millage levied by each entity is in parens:

Entity (mill)     FY 2014      FY 2015         

A2 (16.5720)   $  429,409   $   11,958
WC (5.7654)    $  149,392   $    4,160   
WCC (3.6376)   $   94,257   $    2,625
AADL (1.55)    $   40,163   $    1,118

Total "Rebate" $  713,221   $   19,862

DDA Capture    $3,964,457   $4,774,758

-

In FY 2014, there’s a sizable redistribution calculated. But in FY 2015, it’s almost inconsequential. Why is there a disparity between years? This relates to the fact that the language of ¶1 asks a tax analyst to determine whether the valuation of the increment “grows at a rate faster” than that in the TIF plan projection. And completely absent any context, that phrase could mean one of two things when the TIF is calculated:

1. The analyst is supposed to compare the increment’s valuation this year to last year’s valuation, and ask: Was the rate of increase from last year to this year greater or less than the rate of increase forecast in the TIF plan?
2. The analyst is supposed to compare the increment’s valuation this year to the valuation at the start of the DDA, and ask: Is the rate of increase for the whole period of the DDA up to this year greater or less than the rate of increase forecast in the TIF plan?

Graphically, here’s the situation. The green line is the actual valuation of the increment. The blue bars represent the three alternatives – realistic, pessimistic or optimistic.

The green line shows actual valuation. The blue bars depict the TIF plan projections for the increase in valuation, based on pessimistic, realistic, or optimistic projections. Year X is 2004. Data for the final two years was estimated. For other years, the figures are actual.

The proposed Chapter 7 revisions help provide some clarity on the question of which blue bar to use: Use the darkest blue bar – the one labeled “realistic.” But the Chapter 7 revisions don’t provide clarity on the question of a year-to-year versus cumulative method.

Let’s say it’s YEAR X+7 and we’re trying to calculate the right TIF. Graphically, here’s the question: Do we use the method in Chart A or in Chart B below? More simplistically, for YEAR X+7, do we use the little triangle to compute the rate of increase, or do we use the big triangle?

Chart A: Year-to-year increase method.

Chart B: Cumulative increase method.

If we use the big triangle (cumulative approach), then the corresponding big triangle for the blue bars is this one:

Chart C: TIF plan growth rate (cumulative).

It’s pretty easy to see that the triangle in Chart B shows a greater rate of growth than the triangle in Chart C. That is, the rate of growth for the actual valuation of the increment in Year X+7 (green line) is greater than the rate of growth indicated in the TIF plan (blue bars).

And in fact we don’t have to draw the triangles for the cumulative approach. Just look to see if the green line is above the blue bars. On the cumulative approach, if the green line is above the blue bars, then the DDA should distribute TIF back to other taxing authorities.

But on the “small triangle” analysis – the year-to-year approach – if the green line levels off or dips, as in YEAR X+8, then that would count as less of an increase than the steady gains forecast in the TIF plan. So in YEAR X+8, no distribution would be owed to the other taxing authorities. That’s despite the fact that the green line is clearly still above the blue bars. On the year-to-year approach, increases in the valuation that exceed expectation could yield an immediate benefit to other taxing authorities only in the same year a new development comes on line. Thereafter the DDA would, on this approach, capture taxes on the full amount of the increment.

That’s why the city treasurer’s calculations show a drop-off for the amount of redistributed TIF from FY 2014 to FY 2015. It’s the year-to-year method that is assumed. From the memo [emphasis added]:

The DDA will use the same method of calculation used in the determination of refunds for Fiscal Years 2003-11. This method contemplated a year to year actual rate of increase versus the rate of increase of the tax base growth estimate in the TIF plan, not the value of the difference between the actual capture versus the tax base growth estimates in the TIF plan.

That’s the part I think councilmembers need to challenge. I think there’s no question that the only rational way to handle this is to take the cumulative approach.

We know there was concern back in the early 1980s expressed by other taxing authorities – about the amount of TIF that might be captured by the new DDA. We know that this concern is almost certainly the reason ¶1 appears in the DDA ordinance at all. I think that any rational conversation back in the early 1980s must surely have been based on this basic intuition: If the green line is above the blue bars, then half the distance between them will be redistributed to the other taxing authorities. With this historical context, it’s not plausible to use a year-to-year method to calculate the TIF under Chapter 7.

In round back-of-the-napkin numbers, if these calculations were done correctly, the city of Ann Arbor could expect to see at least $250,000 added to its general fund every year, not just this next year.

Next Steps

While I’m championing a further ordinance revision that would commit to a cumulative approach for these calculations, I think it’s important to pause and ask for some additional specific data. It’s also important explicitly to solicit the view of the other taxing authorities involved.

I would suggest that any action by the council on March 4 include the following:

• Direct the city treasurer to estimate TIF redistribution to other taxing authorities and DDA tax capture for the next 10 years, using: (1) the cumulative approach; and (2) the year-to-year approach.
• Request that the DDA incorporate the city treasurer’s estimates under (1) into its 10-year planning spreadsheet and to make that spreadsheet public.
• Communicate the DDA’s 10-year plan and the city treasurer’s estimates to the Ann Arbor District Library, Washtenaw Community College, and Washtenaw County, with a request that the governing bodies of those entities comment on the information.

All this might entail postponing the ordinance revision, even though the council’s consideration this coming Monday will only be for a first reading. I think it would be reasonable to postpone the proposed ordinance change – in the interest of nailing down the correct approach to these calculations to everyone’s satisfaction.

It would not be reasonable to vote down these ordinance revisions based on the idea that they’re just political theater.

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The committee has been discussing a proposal by Dan Ketelaar for support of a proposed development at 618 S. Main, which received a positive recommendation from the Ann Arbor planning commission on Jan. 19, 2012. The 7-story building would include 190 units for 231 bedrooms, plus two levels of parking for 121 vehicles. Ketelaar has estimated that the tax on the increment between the current valuation of the property and the final built project would yield around $250,000 a year in TIF (tax increment finance) revenue to the DDA.

Ketelaar is asking that the DDA pledge 80% of its TIF capture money for six years – about $1.3 million – to support certain aspects of the project in connection with the state’s Community Revitalization Program. The CRP is the successor to the brownfield and historic preservation tax credit program. In order to approve the tax credit, the state would like to see a commensurate commitment from local units – and Ketelaar is proposing that it take the form of the DDA’s support.

At the April 11, 2012 DDA partnerships committee meeting, one of the points that resonated strongest with some board members in favor of supporting the 618 S. Main project was the ability of the contribution to leverage state money that would otherwise not be invested in Ann Arbor. The amount of money from the state that could be leveraged is in the range of $3 million.

Under Ketelaar’s proposal, taxes on the property would still need to be paid. In other words, the DDA would not simply waive its tax capture on the property. The 618 S. Main project would be reimbursed for a portion of those taxes it would normally owe. In the draft policy, that’s reflected in the following passage: “The DDA will not forgo its TIF capture from a project; the DDA may elect to provide a grant to a project utilizing its funds, or it may elect to provide all or some of its support using such in-kind elements as access to parking for contractors or construction staging.”

The maximum amount of a possible grant described in the draft policy is “calculated by estimating 25% of the total TIF captured by a project over ten years.” In the case of the 618 S. Main project, that amounts to .25*(10*$250,000) = $625,000. That’s about half what the 618 S. Main project is requesting.

The DDA board has heard about the proposal on several occasions – first at the full board meeting on Feb. 1, 2012, and at four subsequent DDA partnerships committee meetings. DDA board members are cautious about the precedent that such a pledge might set, and the appropriateness of the DDA’s role at this early stage in the project. (Ketelaar has not yet acquired the land.) At the March 28 partnerships committee meeting, DDA board member Newcombe Clark expressed concern that, depending on the precise role defined for the DDA’s participation, the DDA could effectively be artificially inflating land values.

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