This week, national news outlets were the first to report that a City-owned parking lot at South Ashley (also known as the Klines lot) could potentially be sold to Sports Illustrated Resorts for the development of a new hotel and conference center. The Klines lot was previously earmarked and assessed for the development of affordable housing. If a deal with Sports Illustrated Resorts moves forward, it will have skipped at least three steps of public consideration and transparency.
https://www.si.com/media/2023/09/28/sports-illustrated-resorts-discussions-ann-arbor-michigan
(Clarification added 10/2/2023: While Sports Illustrated was the first to report that Sports Illustrated Resorts was considering an Ann Arbor location, MLive/The Ann Arbor News was the first to report that the talks involved the city-owned Kline Lot.)
RESCIND & REVERSE PAST POLICY
A previous Council – including Mayor Taylor – voted repeatedly in support of developing specific City-owned properties with affordable housing. In April 2019, I co-sponsored a resolution that introduced the idea of using City-owned properties for the development of affordable housing.
Resolution Directing the City Administrator to Collaborate with the Ann Arbor Housing Commission to Provide Coordinated Analysis on the Feasibility of City-Owned Properties as Potential Locations for Affordable Housing
https://a2gov.legistar.com/LegislationDetail.aspx?ID=3903308&GUID=38598520-B6EE-4907-878A-D523E72D50FD
The resolution included explanation of the purpose:
“City Council has adopted the strategic goal of establishing Ann Arbor as a safe, warm and welcoming community. Consistent with that goal, the ability to provide affordable housing options is essential to that goal. The redevelopment of City-owned parcels of land that lie in the urban core, along transit corridors, and in the vicinities of employment centers can serve as a means to reduce the costs.”
At the time, this strategic goal was also included in the Council-approved budget:
“Staff support for this effort is already included in the FY19 and FY20 budgets. An additional $100,000 is identified in the Affordable Housing allocation proposed in the FY20 budget.”
In November 2019, Council approved a resolution to move forward with community engagement on development options at the Klines lot.
Resolution to Direct City Staff to Conduct Community Engagement Around Development Options for Ashley/William and First/William Surface Parking Lots to Support Affordable Housing in the City
https://a2gov.legistar.com/LegislationDetail.aspx?ID=4218356&GUID=71A90768-33F2-45A6-B4B7-5457B44153EE
From the resolution:
“The Kline’s lot D1 zoning, and affordable housing density bonus, would allow for 400-600+ housing units and other uses such as first floor retail or office space.”
In November 2019, Council received the first report on the financial feasibility of developing affordable housing on City-owned properties.
Analysis of the Financial Feasibility of Developing Under-Utilized City-Owned Properties as Affordable Housing
https://a2gov.legistar.com/LegislationDetail.aspx?ID=4218095&GUID=FE93751E-7D9B-4B45-8D74-575095A4AA75
That report showed the Kline’s lot as “high” priority.
https://a2gov.legistar.com/View.ashx?M=F&ID=7863583&GUID=739FCFD2-50C5-4475-8547-5EE2868C75A3
That analysis was updated and presented to Council in July 2020, with the Klines lot continuing to rank as “high” priority compared to other locations.
Analysis of the Financial Feasibility of Developing Affordable Housing on Under-utilized City-owned Property
https://a2gov.legistar.com/LegislationDetail.aspx?ID=4582765&GUID=492025D0-8952-4B55-B2BE-4450F25551F1
Later that same month (July 2020), I co-sponsored a ballot initiative for an affordable housing millage that was approved unanimously by City Council.
Resolution to Order Election and to Determine Ballot Question for Charter Amendment for the 2021 Affordable Housing Millage (7 Votes Required)
https://a2gov.legistar.com/LegislationDetail.aspx?ID=4594518&GUID=9C444F1C-CBCB-4BC1-A6A5-32DEF21F7334
Explanation of the millage’s intended purpose and use included this statement:
6. The City prioritizes projects that will have permanent affordability commitments, which is achievable through:
a. Development of publicly owned properties
b. Public ownership through the Ann Arbor Housing Commission and its affiliated non-profit development entities
c. Mission-driven non-profits committed to permanent affordability restrictions
d. Cooperative housing or other housing ownership models with permanent affordability restrictions
In November 2020, five new Council Member (all endorsed by Mayor Taylor) were elected and the affordable housing millage was approved by community vote. A majority of the current Council – the Mayor and five members elected in 2020 – should be aware of existing policy, given significant reports and communications that have happened since 2021.
In April 2021, a report on community engagement confirmed public support for affordable housing at the location. A slide presentation described the need for affordable housing downtown.
Report on Community Engagement for Four Downtown City-Owned Properties as Affordable Housing and Update on Ten City-Owned Properties
https://a2gov.legistar.com/LegislationDetail.aspx?ID=4905562&GUID=CDAF5CB4-146B-4D27-A14F-5423A16A3C06
In June 2021, City Council held a work session on the topic.
Update on Development of City-Owned Properties as Affordable Housing
https://a2gov.legistar.com/LegislationDetail.aspx?ID=4972411&GUID=7703CE05-9409-4F82-B5DF-EFE241CA56DA
A presentation included this explanation:
The City is considering the following objectives for redeveloping 309 S. Ashley
- Maximize affordable housing units below 60% Area Median Income (AMI)
- Maximize market rate housing units
- Develop a mix of housing unit types and prices
- Activate the ground floor for public benefit
- Provide parking on site
- Maintain some City ownership/control
- Appropriately scale down to the west and/or Main Street
Existing policy is very clear. A previous Council (including the Mayor) established the policy that these City-owned parcels were an opportunity to build affordable housing units at specific locations. A majority of Council – the Mayor and the five members he endorsed in 2020 – are well aware that the feasibility of affordability housing at these locations was assessed. They should be well aware, also, that a process of public engagement found support for the development of affordable housing at the Klines lot.
OPEN PROCESS
If Council had voted to rescind past policy – the policy to develop affordable housing at City-owned properties – that step, alone, would not permit backroom negotiations for a sports resort on the Klines lot. Reversing previous policy only opens the door for a wide range of other profit-seeking ventures. In the past, when City-owned properties have been specifically designated for sale and redevelopment by private developers, they were the subject of either an open bidding process to generate the most revenue or an open RFP process to dictate the end product.
A City-issued RFP – “Request for Proposals” – identifies community goals and priorities, and invites proposals to meet them. The RFP process is public and includes very clear guidelines for how proposals are submitted to City staff. This RFP process is an important mechanism for transparency, to prevent unfair advantage to specific people or entities. City-issued RFPs include boilerplate language that prohibits direct communication with anyone who might have influence over the process:
“Attempts by the bidder to initiate contact with anyone other than the Designated City Contacts provided herein that the bidder believes can influence the procurement decision, e.g., Elected Officials, City Administrator, Selection Committee Members, Appointed Committee Members, etc., may lead to immediate elimination from further consideration.”
It is worth noting that two Council Members have at least acknowledged – via social media and emailed newsletters – that an RFP might be the appropriate process for consideration of something like a sports resort on the Klines lot. However, according to MLive, the whole of Council have – behind the scenes – already considered the single proposal from Sports Illustrated Resorts:
“City Council Member Erica Briggs, D-5th Ward, said council members recently got a look at a rough concept for the Sports Illustrated Resorts development, which also includes condos.”
City Council did not bother to issue an RFP when it would have been appropriate to do so. Additionally, they have already violated the terms of what that RFP would have required in terms of open, fair, and objective process.
CHOOSING A PROPOSAL
If Council had voted intentionally to reject the plan for affordable housing on this site and then issued an RFP for the property’s sale and redevelopment, even those two steps would not inevitably lead to private negotiations with a buyer such as Sports Illustrated Resorts. The results of an RFP would lead to a staff recommendation and eventually a public vote of Council. The choice of a specific proposal would appear on a Council meeting agenda and be subject to a public vote by our elected representatives.
This week, we learned that this process has been turned on its head. Our City government is not engaged in an open public process to generate either maximum revenue or maximum community benefit. Instead, the City administrator and City Council is engaging with just one potential developer. According to MLive:
“Dohoney said Sports Illustrated Resorts approached him directly and the CEO is a longtime Ann Arbor resident.”
‘“At this point, we’re in discussions,” Dohoney said, adding there is no deal yet and the resort company is still doing its due diligence and gathering information.”
WHY THIS MATTERS
City leaders are currently negotiating a deal that would violate the policy still in place and approved by a previous Council: City-owned properties are a resource to be used for the development of affordable housing. That policy was repeatedly voted on and approved in public meetings by a majority of elected representatives. The whole of our community voted on an affordable housing millage in support of that policy: revenue from the millage is described as funding the development of affordable housing on City-owned properties.
In April 2023, City Administrator Dohoney publicly presented his budget which included the idea of using City resources to build high-end market rate housing. MLive reported:
“Dohoney also proposes the city sell the city-owned Klein [sic] Lot parking lot downtown to facilitate another high-density, market-rate development to generate new city revenue. Multiple council members also have expressed support for that.”
In the months since Dohoney’s presentation, Council has put nothing on a public agenda to specifically debate or consider the idea. There is no public record of any vote to reverse established policy regarding the City-owned properties previously designated for the development of affordable housing. There is no public record of any vote to sell this property to private developers, either to the highest bidder or through an RFP process. Elected leaders have already violated the terms of what could have been an open and transparent RFP process.
An official social media account for the City announced on Friday:
Exciting news for Ann Arbor, which is in discussions with Sports Illustrated Resorts to evaluate our beautiful college town for a sports-themed resort in A2!
Council members elected in 2020 and 2022 postured their commitment to affordable housing while aggressively insisting that incumbents were “anti-housing.” A previous Council approved policy, analysis, and public engagement leading to a recommendation that this property be developed with affordable housing. City voters approved funding to support affordable housing on this site and others. Our community should have the opportunity to consider whether a “sports resort” is a better use for this property.