A2Politico: Ann Arbor Politics Grilled To Perfection

When Google rode into town promising to create 1,000 jobs by 2011, Mayor and Council responded to the racy proposition by taking over $2 million dollars from the city’s already stretched General Fund and creating a new fund called the Economic Development Fund. It should have been called the Rob Peter to Give Away Money to Paul Fund. With the magical appearance of money in the Economic Development Fund, Council took taxpayer money and paid to give Google 400 parking spaces. That crazy arrangement is due to expire in December 2010. I call it crazy for any number of reasons not the least among which is that Google created about 20 percent of the total jobs the company promised, yet still took (and was given) 100 percent of the free parking spaces promised. For every one job created by Google, Ann Arbor taxpayers funded two (yes, two) parking spaces. 

Now, money from the Economic Development Fund aka the General Fund is being used on the Fuller Parking Garage project. Our tax dollars are being used to pay a consultant to design a parking garage for the University of Michigan. 

In Ann Arbor, our current Mayor and Council simply don’t evaluate business propositions with any modicum of business sense. They will entertain just about any proposition, and give away more money than is practicable in order to smooth the way for the smooth-talking types who come before Council and want their way with the group. The current rumor that it’s tough for those Willy Loman types, developers who ride into town, architectural plans in their travel bags, is pure nonsense and bunkum—developers Newcombe Clark and Jeff Helminski included. Clark recently launched a bid to unseat Fifth Ward Council member Carsten Hohnke because Hohnke sent a note to be read by Fifth Ward Council colleague Mike Anglin that made it clear that Hohnke did not favor Clark’s Moravian project. 

One has to wonder why Newcombe didn’t run for Mayor. It was Mayor Hieftje, after all, who sank any chance Clark and partner Jeff Helminski had for their Planned Unit Development (PUD) petition to be approved. Hieftje voted against the PUD petition, while Carsten merely sent a note to the meeting and missed the vote. For that matter, why doesn’t Clark move to Ward Three and take on Council member Chris Taylor? Taylor voted for the PUD, but in taking out Taylor, Clark could live la vida loca and spend his days making the life of the other Third Ward Council member, Steve Kunselman, a towering inferno. 

It’s my supposition that sometime during the years when Helminski and Clark accumulated their multiple small parcels in the Germantown neighborhood, someone, somewhere, led the two to believe that the P.U.D. was in the B.A.G. All they would have to do was jump through a few hoops at the Planning Commission (which eventually recommended that the Moravian PUD be approved) then, on the Commission’s recommendation, Council would approve the PUD, just as they did for the Near North project. It’s no secret that there are those on Council who believe that the neighborhoods adjoining downtown are fair game for denser development, despite what the residents, zoning laws and various city master plans might say. However, there arose a Third Ward Council member in August of 2009 who knew not Joseph, Jeff or Newcombe. Steve Kunselman voted against the PUD. I can only venture a guess and that former Third Ward Council member Leigh Greden would have heeded the advice of former Second Ward Council member Joan Lowenstein, when she stood before Council and told members not to give in to the “sulkers,” and approve the Moravian PUD. 

Since 2000, some 41 development projects have been approved by City Council, developments totaling close to 4,000,000 square feet of new development in our city. Those projects include the 2003 City Council approval of a 633,000 square foot fantasy-land at the corner of Broadway and Wall Street, called the Broadway Village PUD Site Plan. The Broadway Village was supposed to include 7 buildings, 196 units of residential space, and over 760 parking spaces. It’s currently a 7.3 acre eyesore that has enjoyed seven years worth of site plan extensions thanks, one imagines, to the political donations and connections of developer Peter Allen. There are other communities that pull site plan permissions after six months if the developer hasn’t secured funding and broken ground. I have to imagine that Allen, the Broadway Village developer, will petition Council in October of 2010 for another extension. I also have to imagine that funding for the project will not be any more forthcoming in October of 2010 than it was in 2003, when the project was first approved. 

It makes no sense to allow Peter Allen to squat at the corner of Broadway and Maiden Lane as he waits for the banks to see the light and finance his development, or at least make sure he gets his developer’s fees before the project goes belly-up, and Ann Arbor is left holding the bag.

So, why can’t developers get their projects built in Ann Arbor? Well, for starters, since 2000 our Mayor and City Council have fallen over and again for the same story: nice project, grandiose financing scheme. Over and again, planning staff have advised the Planning Commission that the individual projects were viable, and Planning Commission has advised Council to say yes to the proposition. Over and again, the developers were unable to begin construction. Not once, not twice, but 40 times since 2000. In fact, the number of development projects that have been approved since 2000 exponentially outnumbers the number of projects turned down by City Council, including as the Moravian.

In going door-to-door, I’ve heard over and again from voters that they want to see the zoning laws applied fairly and uniformly. They want to see PUD projects in near downtown neighborhoods discouraged, and density concentrated within the boundaries of the Downtown Development Authority. After all, one voter pointed out, that’s how the Greenbelt millage was sold.

Well, no. That’s not how the Greenbelt millage was sold.

In 2003, not a single piece of Greenbelt millage campaign literature linked the Greenbelt campaign to increasing density within the city of Ann Arbor. Chapter 42 of the City Charter that deals with the implementation of the Greenbelt millage says nothing about downtown density as a reason to repurpose the then land acquisition millage money. Elected officials, Greenbelt Advisory Committee members and city staff have “repurposed” the intention behind the Greenbelt millage passage to suit their political belief that we must increase density in downtown Ann Arbor. However, the Greenbelt millage was sold and presented to voters this way: 

From Chapter 42 of the Charter: Uncoordinated development in the areas around Ann Arbor has affected and may continue to adversely affect the quality of life in Ann Arbor leading to fragmented open space and wildlife habitat; loss of productive farmland and forestland; destruction of rural beauty which is part of the natural historic character of the Ann Arbor community; decline in water quality and the loss of wetlands; increased auto dependency, fuel consumption, traffic congestion and air pollution; relocation of jobs to peripheral area; excessive public costs for roads and utility infrastructure, new and extensions, to dispersed development.

Now, almost 10 years and $22 million dollars later, a map of the Greenbelt millage purchases shows 1,782 acres “saved” from development.

What should be obvious from the map is that the total amount of land acquired within the boundary is miniscule. The 30 year 0.5 mill tax for and acquisition is anticipated to raise between $80 million and $100 million dollars from Ann Arbor taxpayers. Even doubling or tripling the number of acres will not substantially increase the total land mass, or create anything close to a “green belt” around Ann Arbor. What we will have done is to have preserved multiple small parcels of open space and farmland in outlying townships. Meanwhile, the opportunity for a Greenway languishes, brought back from the dead every two years, like Lazarus, by politicos who pledge to support a Greenway for the city.  

While the Mayor claimed in a January 2010 AnnArbor.com post this is a “golden” time to swoop in and pay less than the $12,000 per acre on average that has been paid for the rights purchased, Ginny Trocchio one of two people who manage the Greenbelt millage program, was quoted in an April 14, 2010 AnnArborChronicle.com post as refuting the notion. Trocchio is quoted thusly, “The market has changed dramatically since the millage passed. Land values have dropped sharply, but landowner expectations remain higher than the actual market price— that’s an issue in trying to negotiate deals.” The dilemma makes sense, in fact. Chances are good that land rich, cash poor landowners need money now more than ever. 

The most recent example of this propensity to accept propositions sits at 2502-2568 Packard. The 91,700 fantasy-land was to be called Georgetown Commons. Even with the TIF (tax increment financing) sweetheart deal from Council that would have given tax dollars to the developer, the Titanic development scheme sank after hitting the icebergs of financing, debt and unpaid taxes. The property is valued at $4.6 million, based on its 2010 state equalized value. Developer Craig Schubiner paid $6.1 million for it in 2001, according to city documents.

After creating a 6.4 acre disaster by letting Craig Schubiner talk them into a TIF financing package, City Council created the Georgetown Mall Citizen’s Committee which held a meeting at 6 p.m. April 22nd in a 6th floor conference room at City Hall. Citizens will come together and figure out how to clean up the mess created by Council’s short-lived love affair with the Georgetown Commons developer. 

So what’s the answer to this decade-long string of failed development? It’s simple: no more tax increment financing (TIF) giveaways to private developers, no more public-private partnerships where our tax money is used to subsidize private development projects, or mitigate the risks, as First Ward Council member Sandi Smith once said, of private development in Ann Arbor. Those public-private partnerships are breeding grounds for what President Obama’s chief economic advisor Dr. Lawrence Summers, referred to as “crony capitalism.” The public good is subverted for the sake of private gain. Public policy is replaced with back room dealing. An excellent example of crony capitalism is the convention center RFP process, a sham procedure designed to give us a predetermined outcome. A few politicos, including the Mayor, City Administrator and former Chamber of Commerce leader decided quietly among themselves as early as 2008 that Ann Arbor’s downtown needed a convention center. 

As elected officials, and as a community, we’re going to have to apply significantly more business acumen, vision and skepticism when developers come forward with plans such as the Broadway Village and Georgetown Commons. Yes, it’s a great bullet point for a political résumé to bring in and break ground at such a project, but when the projects fail, as those two have, our community as a whole suffers tremendously. The closed Georgetown Mall has spurred an increase in crime in the neighborhood around the area.

If Ann Arbor is to become a community in which development investments are approved, financed and built (a critical three-step process), we’re going to have to reshape the way in which projects are taken through the planning process, and by whom. We’ll have to carefully analyze and study the successes and the failures of the past decade to identify patterns, people and issues where Ann Arbor’s staff, appointed and elected officials can do a better job helping those who want to invest in our community do so equitably and, ultimately, in the best interests of the taxpayers.

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