Ann Arbor City Council Newsletter (June 2, 2024)

Jun 2, 2024 | Newsletter

Hello neighbors!

Welcome to my Ann Arbor City Council newsletter, where you can connect with primary sources to understand the work of your local government. My goal is to provide clear explanations of all the issues your elected representatives will be discussing at their next meeting and alert you to local policy and decisions that have been assigned to unelected Mayoral appointees.

This week, the Ann Arbor City Council considers a long agenda, most of which is likely to be approved without discussion. The Consent Agenda includes 34 items which will be approved with a single vote unless Council Members intentionally ask that items be pulled for discussion. The regular agenda includes three public hearings: final approval of a rezoning and site plan (732 Packard) and amendments to the snow removal ordinance.

PROMOTING LOCAL DEMOCRACY

Volunteers are circulating petitions now to put two questions on the ballot for Ann Arbor voters. If approved, more voters could participate in choosing local leaders and our local elections would be less vulnerable to influence from big money (including PACs).

One initiative seeks to bring Ann Arbor into line with Michigan’s other cities and make our elections for City Council and Mayor nonpartisan. This would end the low-turnout August partisan primaries and have all candidates appear on the November ballot without party affiliation. 

Information about Democracy for Everyone is at this website: https://www.a2nonpartisan.com/

The second initiative would bring campaign finance reform to Ann Arbor. Running for local office has gotten very expensive–candidates for Council now need about $40,000 to have a chance. Much of this money comes from a handful of big donors and PACs. Using a model that’s worked in Denver, Portland (OR), Evanston, and elsewhere, this proposal would establish a Fair Elections Fund for candidates who agree to not take PAC money and to accept limits on the size of donations. 

More information is at the Voters Not Money website, which includes a video that explains the impact of money on our democracy: https://www.a2future.com/

Anyone interested in supporting these measures with your signature can find us on weekdays (M-F for the next two weeks) from 3 p.m. to 7 p.m. at 310 S. Ashley, or at the Farmers market on weekends and Wednesdays. For other locations or – if you have friends and neighbors you know who might like to support this – you can sign up for updates on either website. 

Stop by 310 S. Ashley or contact the website to support a stronger local democracy!


Consent Agenda

Two items on this week’s Consent Agenda are notable: 

CA-9 (24-0981) Resolution to Approve Entering into a Six-Month Negotiating Period for the Possible Sale of the 415 W. Washington Site
By resolution, City Council will direct staff to enter into six months of exclusive negotiation with one developer – 4M – in order to sell the City-owned property at 415 W. Washington. A purchase agreement will be prepared and sent to Council for approval by December 31, 2024. See my “Additional Thoughts” section below. 

CA-6 (24-0872) Resolution to Appropriate Funding for GovOS Short Term Rental Software ($49,900) (8 Votes Required)
I am glad to see the City investing in strategies to enforce the City ordinance that restricts short term rentals (STR or Airbnb). A budget amendment in CA-6 will fund software intended to help the City identify STRs operating illegally in Ann Arbor.

Dedicated, full-time STRs take away from housing supply that would otherwise be available for year round residents in our community. For anyone who does not know, I led efforts to regulate these types of businesses— I sponsored the 2020 ordinance that introduced STR regulation in Ann Arbor. The original, staff-recommended version of this ordinance wholly banned such investment properties in residential neighborhoods. Shortly after the election new Council Members in 2020, the ordinance was amended and effectively gutted by a new majority led by Mayor Taylor. For more on that, see:
https://a2elnel.com/post/housing-profits-and-hypocrisy/
https://a2elnel.com/post/taking-a-stand-short-term-rentals/

I am glad to see CA-6 this week, but it surprises me.

In August 2023, I received a phone call from a City vendor: Granicus. Granicus provides software and services for the City of Ann Arbor, including the Legistar platform that documents meeting agendas and other public records on the City website. A representative from Granicus called me at home, explaining how they were struggling to connect with the City— they had been trying to reach someone to talk about services they provide to municipalities for enforcement of STR regulation.

I explained that I was no longer on Council, but I was happy to forward an email to City staff. The representative from Granicus explained that all they needed was a half hour of staff time in order to share local data about STRs in Ann Arbor and give a presentation about how their services could help the City track licensing. I emailed City staff and I received this reply on August 3, 2023:

“Thank you for bringing this to us. Although, we have recently signed with another company for a similar service.”

At this point, I asked the rep from Granicus if there was any possibility of hearing their presentation myself. I explained my interest in the issue and concerns that I had heard from residents about illegal STR businesses in neighborhoods. The Granicus rep agreed to meet by ZOOM and share his presentation. I learned a lot from that meeting, more than just City data about STRs.

Granicus has such large contracts with the City that they have designated contacts at City Hall in the IT department. In the spring of 2021, Granicus began outreach to the City (through the IT department), attempting to share information about their services re: STR enforcement. This resulted in an appointment to meet with and present to the City’s rental department. A meeting between Granicus and City staff should have occurred in October 2021 but was canceled at the last minute. For the next seven months, Granicus attempted to reschedule this meeting and continued to reach out to contacts at City Hall. By May 2022, City staff stopped responding entirely.

Granicus software scours online platforms to identify where and how STRs are marketed. Their software tracks evidence of STR rentals and compares it to municipal licensing data. In August 2023, Granicus shared numbers with me: data pulled on August 10, 2023 revealed 696 STR units in the City. Due to the City’s last-minute cancellation of a meeting in October 2021, Granicus had another data point to share: on October 19, 2021, there were 563 STRs in the City of Ann Arbor. Between October 2021 and August 2023, the City saw an increase in 130 STR units; the market supply of STRs in the City of Ann Arbor is growing

Tenants in the City – particularly grad students who choose rentals in quieter neighborhoods – know that some landlords have illegally converted long-term rentals into short term rentals. In August 2023, I contacted people I knew on the Renters Commission, who told me they had been complaining for months that the City must do a better job of identifying and addressing illegal STRs in our community.

That is why I am surprised to see CA-6 on this week’s agenda. A friend on the Renters Commission actually alerted me to it because she was similarly surprised.

Agenda item CA-6 includes no attachments or information about the vendor GovOS. A staff memo explains nothing about how the vendor was chosen but uses the past tense in referring to how “Rental Housing has contracted with GovOS.” The resolution itself seems to include a copy/paste error: “need to continue third-party services to service demands for plan review and trade inspections for major construction projects underway through the end of the FY24.”

For nearly three years, Granicus has been trying to share information about STR enforcement with the City of Ann Arbor. I confirmed this week: the City never did meet with Granicus to learn anything about the services they provide to 26 other Michigan municipalities (e.g. South Haven, Charlevoix, Marquette, New Buffalo, Suttons Bay, etc.)

I am eager to hear how it is explained at the Council meeting. You can find more information about GovOS at: https://govos.com/products/short-term-rental/  Information about Granicus can be found here: https://granicus.com/solution/govservice/host-compliance/


Ann Arbor City Council Meeting Agenda

Below is my summary of issues on the City Council Agenda this week, with links to more information about each of them. If you have comments about any of these issues, you can email all of Council at CityCouncil@a2gov.org

Ann Arbor City Council Meeting
Monday June 3, 2024 7:00PM

Community Television Network (CTN) Studios
2805 S. Industrial Highway, Ann Arbor 48104

The full agenda (including a link to the latest published PDF agenda, and instructions for dialing into the meeting) is on the A2Gov Legistar website:
https://a2gov.legistar.com/MeetingDetail.aspx?ID=1141275&GUID=98D6185A-D2FF-4471-A990-3DAFACBD5496

City Council meetings are broadcast live by CTN on Comcast (channel 16) and AT&T (channel 99) and online at a2gov.org/watchCTN
Meetings are also streamed live on the CTN YouTube channel:
https://www.youtube.com/user/ctnannarbor

How to reserve public comment

People that wish to comment at a City Council meeting must sign up with the City Clerk’s office in advance. Speakers are allotted 3 minutes, with the first 15 speakers allowed to speak in a 45 minute session near the beginning of the meeting. Remaining speakers will speak at the end of the Council meeting. Public comment can be made either in person or remotely via phone/Zoom audio.

To sign up for public comment, please go to or call the City Clerk’s Office at 734-794-6140 on the day of the meeting between 8:00 AM and 5:00 PM. At 4:00 PM, all speakers that have signed up are randomly ordered in “priority groups”. After 4:00 PM, speakers are added to the end of the applicable priority group in the order received. No new speakers will be added to the list after 5:00 PM. For more information, visit the City Clerk’s webpage about electronic meetings, section “City Council Public Commentary Time”
https://www.a2gov.org/departments/city-clerk/Pages/Virtual-Meetings-.aspx

Questions to the Agenda

In preparation for a Council meeting, Council members can ask questions of staff about scheduled agenda items. Questions must be submitted by noon on the Wednesday before a Council Meeting, and answers are returned the next day (Thursday) by 5pm.

AC-1 (24-1032) Agenda Response Memo and eComments – June 3, 2024
This agenda item has a PDF attachment with all questions raised by Council Members, and the answers provided by staff.

Communications from Council

CC-1 (24-0976) Resolution to Appoint Hank Peters-Wood and Olivia Smyth to the Environmental Commission (7 Votes Required)
These appointments are from CM Disch and CM Akmon, who serve on the Environmental Commission. This is being presented at this meeting, and will therefore be voted on at the next Council meeting. Seven votes are required because one of the nominees “is not a registered elector of the City of Ann Arbor”.

  • Hank Peters-Wood – Environmental Commission
  • Olivia Smyth – Environmental Commission

Communications from the Mayor

MC-1 (24-1033) Resolution to Reappoint Carrie Leahy to the Local Development Finance Authority as a Non-registered Elector (7 Votes Required)
This reappointment from the Mayor is being presented at this meeting, and will therefore be voted on at the next Council meeting. Seven votes are required because “the appointee is not a registered elector of the City of Ann Arbor”

  • Carrie Leahy – Local Development Finance Authority

Consent Agenda

Below is the list of items included on the Consent Agenda. If no one on Council specifically requests that an item be pulled for discussion, the whole of this list will be approved in a single vote.

CA-1 (24-0991) Resolution to Approve the 2024 Ann Arbor Jaycees 71st Annual Summer Carnival at Pioneer High School – June 17 to June 24, 2024

CA-2 (24-0837) Resolution to Accept a Fair Food Network Grant for the Ann Arbor Farmers Market for $60,000.00 and Appropriate Funds (8 Votes Required)

CA-3 (24-0944) Resolution to Ratify and Appropriate FY 24 Budget and Allocations for High Impact Grants as Part of the New Human Service Partnership – $350,183 Budgeted (General Fund) (8 Votes Required)

CA-4 (24-0927) Resolution to Recommend Awarding a One-Year Contract to The Davey Tree Expert Company for Routine Park Tree Pruning & Park Forestry Services ($450,000.00, RFP #23-47)

CA-5 (24-0871) Resolution to Appropriate Funds for the Carlisle Wortman Contract for Building Plan Review and Inspection Services ($100,000) (8 Votes Required)

CA-6 (24-0872) Resolution to Appropriate Funding for GovOS Short Term Rental Software ($49,900) (8 Votes Required)

CA-7 (24-0992) Resolution to Order Election, Determine Ballot Question for Charter Amendment for Approval of the Park Maintenance and Capital Improvements Millage for 2025 through 2044, and Reaffirm the Park Maintenance and Capital Improvements Administrative Millage Policy

CA-8 (24-0787) Resolution to Approve 416 Long Shore Drive Development Agreement (CPC Recommendation: Approval – 7 Yes, 0 No)

CA-9 (24-0981) Resolution to Approve Entering into a Six-Month Negotiating Period for the Possible Sale of the 415 W. Washington Site

CA-10 (24-0193) Resolution to Approve the Installation of Traffic Calming Devices on Bird Road (Newport Road to Huron River Drive) ($87,500.00)

CA-11 (24-0194) Resolution to Approve the Installation of Traffic Calming Devices on Henry Street (Golden Avenue to Packard Street) ($70,000.00)

CA-12 (24-0459) Resolution to Prohibit On-Street Parking on the East Side of Page Avenue from Esch Avenue to Harpst Street

CA-13 (24-0845) Resolution to Approve a Right-of-Way License Agreement with Pheenix USH LLC for the Operation of Dockless Electric Micromobility Devices in the City of Ann Arbor

CA-14 (24-0824) Resolution to Approve Amendment No. 1 to the Professional Services Agreement with Orchard, Hiltz & McCliment, Inc. for Professional Engineering Services ($88,500.00 Amendment, $388,500.00 Total Contract) (RFP #22-05)

CA-15 (24-0793) Resolution to Approve Amendment No. 2 to the Professional Services Agreement with Geosyntec Consultants of Michigan, Inc. for Hydroelectric Dams – FERC Title 18 Part 12, Subpart D (Part 12D) Inspections and Other Engineering Services ($125,000.00 Amendment, $340,700.00 Total Contract)

CA-16 (24-0851) Resolution to Approve Amendment No. 3 to the Professional Services Agreement with NTH Consultants, Ltd. for Barton Dam Right Embankment Remediation ($227,700.00 Amendment, $1,170,587.77 Total Contract)

CA-17 (24-0864) Resolution to Approve a Sole Source Purchase Order to Idexx for Bacteriological Testing Media and Associated Supplies ($36,000.00)

CA-18 (24-0767) Resolution to Approve Bulk Chemical Purchases for the Water and Water Resource Recovery Plants of Sodium Hypochlorite (JCI Jones Chemical -Approximately $271,500.00/year), Hydrofluorosilicic Acid (Univar Solutions – Approximately $35,360.00/year), Pebble Quicklime (Graymont – Approximately $945,000.00/year), and Ferric Chloride (PVS Technologies – Approximately $142,496.00/year) Approximately $1,394,356.00/year.

CA-19 (24-0796) Resolution to Approve Professional Services Agreements with Fishbeck, Thompson, Carr & Huber, Inc. for $500,000.00, Stantec Consulting Michigan Inc. for $500,000.00, and Jacobs Consultants Inc. for $500,000.00 for Water Treatment Professional Engineering Services (RFP #24-02)

CA-20 (24-0822) Resolution to Approve Amendment No. 4 to the Professional Services Agreement with Hubbell, Roth & Clark, Inc. for the Headworks Improvement Project at the Water Resource Recovery Facility, RFP No. 19-12 ($230,000.00 Amendment; $1,899,875.53 Total Contract)

CA-21 (24-0731) Resolution to Approve Purchasing Agreements for Utility Infrastructure Materials from Core and Main LP (Not-to-Exceed $789,392.68) and Ferguson Waterworks (Not-to-Exceed $76,306.00) for One Year (ITB-4743)

CA-22 (24-0915) Resolution to Approve a 5-Year Best Source Professional Services Agreement with American Conservation & Billing Solutions, Inc. for a Customer Portal and Consumption Data Analytics Solution (Aquahawk) ($222,641.67)

CA-23 (24-0854) Resolution to Approve a Purchase Order with Cogsdale Corporation for Annual Software Maintenance and Support for FY 2025 ($156,110.78)

CA-24 (24-0857) Resolution to Approve a Two-Year Service Agreement with Emergent Health Partners for Ann Arbor Fire Department Dispatch and Related Services and Appropriate Funding ($348,674.25/2yrs) (8 Votes Required)

CA-25 (24-0925) Resolution Authorizing Water and Sanitary Sewer Capital Recovery Charges for 3039 Stone School Rd.

CA-26 (24-0359) Resolution to Approve Temporary Outdoor Sales, Service and Consumption of Alcoholic Beverages during the 2024 Ann Arbor Art Fair

CA-27 (24-0989) Resolution to Approve the Reauthorization of the Main Street Area Business Improvement Zone

CA-28 (24-0924) Resolution to Approve Grants of Easement for Access over 819 W. Huron Street to Abutting Property Owners (8 Votes Required)

CA-29 (24-1007) Resolution to Approve a Legal Services Agreement with Cummings, McClorey, Davis & Acho, P.L.C. Relative to the Estate of Seth Sugar by its Personal Representative Bryan Sugar v. City of Ann Arbor et al Litigation

CA-30 (24-0926) Resolution to Approve a Retainer Agreement with Weitz & Luxenberg, P.C. and The Sam Bernstein Law Firm for Legal Services to Support the City’s Participation in the Insulin Pricing Multi-District Litigation, In re: Insulin Pricing Litigation, MDL No. 3080

CA-31 (24-0809) Resolution to Approve Amendment 1 to the Professional Services Agreement with Elevate Energy for Administration of the Residential Rebate Program and to Authorize the Disbursement of Funds ($4,250,000.00 in FY24-26)

CA-32 (24-0808) Resolution To Approve a Cost Sharing Agreement with the Downtown Development Authority for the Geothermal Advisory and Professional Services Agreement with Stantec Consulting Services, Inc. ($100,000.00) (8 Votes Required)

CA-33 (24-0788) Resolution to Approve a Professional Services Agreement with DiClemente Siegel Design Inc. for Election Center Renovation Design Services ($107,067.00) RFP #24-11

CA-34 (24-1013) Resolution to Approve an Agreement of Sale for a Portion of the So-called “Transformer Alley” to Bluestone Realty Advisors, LLC in an Amount Not Lower than $240,000 to be Deposited into the General Fund (8 Votes Required)

Public Hearings

Anyone wanting to comment on these issues may speak for 3 minutes, without having specifically reserved time. Issues subject to public hearing will also be up for a vote by Council later in the meeting.

PH-1/B-1 (24-0425) An Ordinance to Amend the Zoning Map, Being a Part of Section 5.10.2 of Chapter 55 of Title V of the Code of the City of Ann Arbor, of 1.3 Acres from C1AR (Campus Business Residential) to PUD (Planned Unit Development), 732 Packard PUD Zoning and Supplemental Regulations (CPC Recommendation: Approval – 8 Yeas and 0 Nays) (ORD-24-11)
Twelve lots totaling 1.3 acres at 732 Packard will be combined and rezoned from C1AR (Campus Business Residential District) to PUD (Planned Unit Development). This area between Packard and State (north of Arch) is currently the site of eleven buildings built between 1901 and 1963. The PUD zoning will allow a high-rise, multiple-family building including sustainability features and required (16%) affordable housing. The planned building will have 14 stories, 376 apartments, 82 vehicle parking spaces, 329 bicycle parking spaces, and potential for ground floor retail and restaurant.

This development would replace the existing Jacks Hardware and ten residential buildings. The Planning Commission approved this rezoning in March 2024: https://a2council.com/ann-arbor-city-planning-commission-march-5-2024/

As part of the PUD zoning agreement, the developer proposed 16% of the floor area for affordable housing units, an increase of 1% over the 15% requirement for a PUD. Alternately, the developer can make a $6.6 million payment in lieu to the City’s affordable housing fund.

During public comment at the May 6, 2024 City Council meeting, a lawyer spoke on behalf of a property owner on this block whose business will be fully enveloped by the project.
https://www.mlive.com/news/ann-arbor/2024/05/dominos-pizza-property-owner-threatens-legal-action-if-ann-arbor-oks-high-rise.html
PH-2/B-2 (24-0826) An Ordinance to Amend Sections 4:60 and 4:61 of Chapter 49 (Sidewalks) of Title IV (Streets and Sidewalks) of the Code of the City of Ann Arbor (ORD-24-12)
Amendments to the city ordinance that requires property owners to remove snow on sidewalks. Proposed amendments will adjust violation fine amounts and clarify different penalties depending on zoning district. Currently, the ordinance dictates fines of $60, $250, and $500 – $1,000 for first, second, and subsequent violations (respectively) in the same season, without regard to zoning district.

This week’s amendment refers to lower density residential zoning districts – R1, R2, and R3 – where the penalties for multiple violations in a single season will be:

  • First violation: $60 – $100 
  • Second violation: $100 – $250
  • Subsequent violations: $200 – $400

As amended, the ordinance will apply different penalties to multi-family properties (R4), other non-residential, and properties adjacent to public land. In those areas, penalties for multiple violations in a single season will be:

  • First violation: $250 – $500
  • Second violation: $400 – $800
  • Subsequent violations: $500 – $1,000 

Language is added to all sections to make clear that the responsibilities assigned to property owners also apply to the “owner’s agent” as registered with the City under regular rental and short-term-rental (Airbnb) licensing procedures.

PH-3/DS-1 (24-0935) Resolution to Approve 732 Packard “5 Corners” PUD Site Plan and Development Agreement (CPC Recommendation: Approval – 8 Yeas and 0 Nays)
A site plan for 732 Packard will permit a building with 14 stories, 376 apartments, 82 vehicle parking spaces, 329 bicycle parking spaces, and potential for ground floor retail and restaurant.

Ordinances – Second Reading

In order to amend the city code, Council must vote to approve the change, via ordinance, at two Council meetings. The following proposed ordinances were approved at a previous Council meeting, and are also subject to a public hearing as listed above.

B-1 (24-0425is the same as PH-1 above
B-2 (24-0826is the same as PH-2 above

Ordinances – First Reading

In order to amend the city code, Council must vote to approve the change, via ordinance, at two Council meetings. The following proposed ordinances are being introduced for “first reading”. If approved, the ordinance will be voted on at a subsequent Council meeting (“second reading”), where it will also be subject to a public hearing.

There are no ordinance first readings on the agenda

Motions and Resolutions

The following agenda items are motions and resolutions, which are approved or rejected in a single meeting. Agenda items marked “DC” are proposed by Council members, items marked “DB” are proposed by City boards and commissions, items marked “DS” are proposed by City staff.

DS-1 (24-0935is the same as PH-3 above

DC-1 (24-0923) Resolution to Appoint Erica Liu to the Independent Community Police Oversight Commission
This appointment is from CM Ghazi Edwin (who serves on the Human Rights Commission), CM Harrison (who serves on the Independent Community Police Oversight Commission) and CM Song (who serves on both the Human Rights Commission and Independent Community Police Oversight Commission). This was presented at the previous meeting, and will therefore be voted on at this Council meeting.

  • Erica Liu – Independent Community Police Oversight Commission

DC-2 (24-1012) Resolution in Support of Boosting State Investment in Public Transit
By resolution, City Council urges the State to increase Local Bus Operating funding in the FY2025 state budget to at least $285 million, in order to cover increasing costs and maintain State reimbursement rates.

DC-3 (24-1047) Resolution Directing the Appropriate Use of Facial Recognition Technology
By resolution, City Council directs the enactment and implementation of policy to make sure that “extra care and caution is used when making charging decisions in cases where facial recognition technology is used as a part of a lawful investigation.” Council further urges County and State police to adopt similar policy.

DC-4 (24-1055) Resolution Authorizing Application and Implementation of Michigan Shared Streets and Spaces Grant
The City Administrator will be authorized to submit a grant application to the Michigan Department of Transportation (MDOT) to support the Fourth Ave Street and Transit Improvements Project. A one-time appropriation of Shared Streets and Spaces Grant (SSSG) funding will support improvements at Fourth Avenue between William and Liberty. More information about the Fourth Ave Street and Transit can be found here:
https://www.a2dda.org/people-friendly-streets/projects/fourth-avenue/


Additional Thoughts

I also published this on my website:
https://a2elnel.com/post/415-w-washington-a-unique-opportunity-for-a-campaign-donor/

415 W Washington: A “Unique Opportunity” for a Campaign Donor

This week, City Council will consider a resolution directing City staff to enter into negotiations to sell the City-owned property at 415 W. Washington to a campaign donor without any open bidding or RFP process, This property has a long history, but the last few years are key to understanding the significance of this particular decision.

BACKGROUND

April 20, 2020

City Council considered a resolution directing City staff to review and recommend development pre-entitlement for 415 W. Washington. In discussion, Council Member Zach Ackerman explained:

I think this is really respectful to those residents who did have concerns about that process because instead it flips it. It puts a lot more public input into the design of the project and then we go to the world. We go to developers around the country and say this is what the community aspires for in realistic terms. Now you come and partner with us.

Council postponed the resolution in order to address concerns about accommodating the Treeline Trail.

https://www.mlive.com/news/ann-arbor/2020/04/plans-for-blighted-ann-arbor-historic-district-property-tabled-by-ann-arbor-city-council.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=4414274&GUID=FF0FFBAD-E26E-4148-985B-4CC210477EEC

July 6, 2020

Council considered the resolution again. The director of the City’s Community Services area, Derek Delacourt, explained several possible outcomes following pre-entitlement, all of them leading to an open process of “request for proposal” (RFP) or bidding among multiple developers.

If we move forward with this as an entitlement and we finish that process and at the end of that process there is a set of supplemental district regulations and an area plan, think similarly to the DTE project that you just passed. We would then put that out as an RFP, which is normally what we would do before we ever did any of this. We would take that finished project and put it out as an RFP and see and hope that we we get solid development offers from private development partners, or if Council said we are only interested in a long term land lease structure, we would limit that RFP response to land lease structures. If Council said we only want co-op, if we came back and recommended there was two or three different ownership structures, if there’s an affordable millage, we would tailor that RFP around those criteria with that finished entitled project and basically put it out for bid. Then we would know what we had as far as a development process or a partner or a price or available funds

So there’s still a lot to be resolved through this process that would determine it, but the point in time would be at the end of that entitlement and when we put this site out for RFP, seeking an actual partner and at a competitive price.

In public comments at the same meeting, local developer (and neighborhood resident) Joe Lambert asked for an opportunity to present a proposal for 415 W. Washington that would address concerns raised by neighbors. In response to Lambert’s request for three months to offer a proposal, Delacourt explained:

As staff we would never recommend handing over any exclusivity on a publicly owned site without some type of RFP process or consideration by Council

We have from day one on the site told developers we’re not interested in talking with them about this site because we’ve made assurances through our entire public engagement process that this would not be a developer driven process&

But if Council were to offer him exclusivity, or if you were asking if we should set aside the entitlement process to give him a window to do this on a non-competitive basis. That wouldn’t be our recommendation.

Council Member Julie Grand agreed:

I think it sets a very dangerous precedent on sitting on the property to ask us to vet and essentially sole source with a private developer who comes in at the last minute.

The resolution was approved and staff was directed to move forward with pre-entitlement for 415 W. Washington.

https://www.mlive.com/news/ann-arbor/2020/07/ann-arbor-moves-forward-development-plans-for-blighted-historic-district-site.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=4414274&GUID=FF0FFBAD-E26E-4148-985B-4CC210477EEC

March 20, 2023

The current City Council unanimously approved PUD Zoning and Supplemental Regulations for 415 W. Washington. The approved terms allow for the development of residential and mixed uses as permitted in the D2 zoning district including residential, commercial and office uses. The PUD will require a minimum of 15 designated affordable housing units or 15% of the total units or a contribution in lieu of units, whichever number is greater.

In discussion, City Council member Disch emphasized the value of having City staff set expectations and requirements for this property:

We are often in the situation of leaving it up to the developer who is an interested party to give us their opinion on what can and can be done. In this case, staff from multiple departments have provided counsel and they have reached agreement.

Council Member Jenn Cornell Erica Briggs (citation corrected 6/7/2024) emphasized the same point, that the standards and type of building was agreed on and established:

I hope that we’re all in agreement in terms of the types of building that we would wanna see built on this site in terms of general direction that we would want a developer to come back to us with.

https://www.mlive.com/news/ann-arbor/2023/03/ann-arbor-advancing-plan-to-redevelop-blighted-site-across-from-ymca.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=6054963&GUID=41B151CE-10DE-4380-811B-79A5ADFADB3E

NEGOTIATION WITH A SINGLE DEVELOPER

This week, Council will vote on a resolution (CA-9), directing City staff to begin six months of negotiation with a single developer (4M) for the “possible sale” of 415 W. Washington.

CA-9 (24-0981) Resolution to Approve Entering into a Six-Month Negotiating Period for the Possible Sale of the 415 W. Washington Site

The company 4M is co-owned by Dr. Margaret Poscher and Heidi Poscher, who sometimes uses the name Heidi Mitchell. Heidi Poscher/Mitchell has given a total of $8,750 to the campaigns of current Council Members, the Mayor and the Mayor’s political action committee (PAC).

Below is a summary of Heidi Poscher/Mitchell’s recent history with Ann Arbor local government:

February 2019

Poscher/Mitchell sought approval for a site plan to redevelop homes on Henry Street. In that process, she reassured the Planning Commission that the new housing units would not become short-term rentals (STRs or “AirBnB”). As soon as the Henry Street site plan was approved by City Council, she announced her intention to develop STRs there.
https://www.mlive.com/news/ann-arbor/2019/02/group-living-with-co-working-space-for-young-professionals-coming-to-ann-arbor.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=3853549&GUID=F54CD7AD-FEE8-43FB-B010-FB7BFF706495

September 2020

A majority of City Council approved a staff-recommended ordinance regulating STRs and banning dedicated, full-time investor properties in residential neighborhoods. Mayor Taylor was in the minority, opposing the ordinance.
https://www.mlive.com/news/ann-arbor/2020/09/ann-arbor-bans-dedicated-airbnb-short-term-rental-properties.html

Poscher/Mitchell and other investors threatened to sue the City over the proposed STR ban.
https://www.mlive.com/news/ann-arbor/2021/01/airbnb-property-investors-may-sue-ann-arbor-if-council-doesnt-lift-pending-ban.html

December 2020

In their first month of public service, newly elected members of Council directed staff to prepare amendments to the ordinance regulating STRs in order to “enable the continued operation of preexisting short term rentals.” 
https://www.mlive.com/news/ann-arbor/2020/12/new-ann-arbor-council-looks-for-way-to-keep-airbnb-houses-in-neighborhoods.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=4733989&GUID=7AA9862B-49AD-4541-9831-4FE461B4AF9E

April 2021

Mayor Taylor led a majority of Council in approving amendments to allow Poscher/Mitchell and other investors to maintain their STR businesses in residential neighborhoods.
https://www.mlive.com/news/ann-arbor/2021/04/ann-arbor-mayor-urges-council-to-cut-losses-on-short-term-rentals-and-move-on.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=4892427&GUID=B937507A-2A1C-4FEB-8F94-9692ED9EBB88

December 2022

Mayor Taylor (with the approval of Council Member Travis Radina) announced his intention to appoint Poscher/Mitchell to the Renters Commission as non-voting “Landlord.” It was withdrawn after members of the Renters Commission raised concerns.

See “Version 1” (“Heidi Porcher”): 
https://a2gov.legistar.com/LegislationDetail.aspx?ID=5946031&GUID=B03BE187-3F09-48F6-A847-D64DE6F917CA

September 2023

City Council unanimously approved a rezoning for SouthTown in order to permit Poscher/Mitchell to develop yet more STRs. As happened in 2019, Poscher/Mitchell offered assurances: no more than 30% of SouthTown would be full-time dedicated STRs.
https://www.mlive.com/news/ann-arbor/2023/09/you-had-me-at-density-ann-arbor-oks-8-story-southtown-development.html

https://a2gov.legistar.com/LegislationDetail.aspx?ID=6312253&GUID=410FA52E-92DB-42BA-98F5-4A2E0A257C44

October 2023

Poscher/Mitchell was among the first reported donations to the Mayor’s PAC, giving $5,000. Using the name “Heidi Mitchell,” she donated an additional $1000 to CM Jen Eyer.

November 2023 to April 2024

The Mayor’s PAC distributed the following:

  • $1000 to CM Jen Eyer
  • $750 to CM Erica Briggs
  • $1000 to CM Lisa Disch
  • $1000 to CM Travis Radina
  • $500 to Mayor Christopher Taylor
  • $1000 to Council Candidate Jon Mallek (Ward 2, unopposed)

For more on the Mayor’s PAC, see:
https://www.mlive.com/news/ann-arbor/2023/10/ann-arbor-mayor-starts-new-pac-called-ann-arbor-for-everyone.html

Link to campaign finance reports for the PAC:
https://campaignfinance.us/washtenaw.mi/iCommitteePortal.php?iCommitteeID=129759

CONCLUSION

The staff memo attached to this week’s resolution acknowledges:

In most instances staff would issue an RFP or partner with a real estate agent to pursue a development team for the site. In this case, the recommended developer meets many of the local community’s desires and offered a unique opportunity to provide a carbon neutral building.

https://a2gov.legistar.com/LegislationDetail.aspx?ID=6702495&GUID=3D3CACBD-3295-476D-9A9A-6FC3EB058FAE&Options=&Search=&FullText=1

The resolution in CA-9 is much more than simply a “unique opportunity.”

Attachments on Legistar include a proposal letter from Dr. Margaret Poscher (spouse of Poscher/Mitchell) dated March 2024. In that letter, Dr. Poscher introduces a possible purchase price of less than half of the 2019 appraised value: 

we propose to move forward into a due diligence period with a target transaction price of no less than $2.5M up to the 2019 appraised value of $5.5M.

https://a2gov.legistar.com/View.ashx?M=F&ID=12979957&GUID=5403E3E3-8DDE-4FFA-A1C6-239777A0DF57

An open, competitive process would be set aside for the benefit of a campaign donor who offers to buy it for potentially three million dollars less than an appraised value from five years ago. 

For anyone eager to see this property cleaned up and redeveloped, this resolution also opens the door to significant delay. City staff is directed to execute a purchase agreement by December 31, 2024. However, 4M is granted an additional “exclusive due diligence period of 12 months after execution of the purchase agreement” in order to conduct “necessary investigations, complete development entitlement, and other activities.” City staff is given six months to negotiate terms and price with 4M, but then 4M is granted an additional year to determine whether it’s even feasible. 

If approved, this resolution sets aside all previous plans for the sale of this City-owned property. City Council will vote on whether a large campaign donor should have exclusive options on a City-owned property for up to 18 months.


Thank you for taking the time to be informed about our local government!
Elizabeth Nelson