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Ann Arbor Area Community News

Broadway Village Development to Go Forward

13. February 2006 • Dale Winling
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Broadway Village Sketch

The Ann Arbor News today reports that Strathmore Development Company has made lease arrangements with several health care groups for commercial space at the mixed-use Broadway Village in Lower Town, meeting the benchmarks of a development agreement with the city and triggering a city process to finance infrastructure development and cleanup at the site.

The names will be revealed in the next 30 days when Strathmore supplies the leases and other documents to the city of Ann Arbor. In 2004, the city approved a development agreement with Strathmore stipulating that the company had to pre-lease at least 75 percent of the commercial space before the city would issue $40 million worth of bonds necessary for infrastructure development, including a brownfield cleanup. Underground contamination has spread across the property to Traver Creek, said Chappelle.

You can read more about Broadway Village here and here.



  1. Hmmm, looks like Broadway Village will be an offshoot of the medical campus. That isn’t a bad use for that area, but it sure isn’t what was originally proposed. Will it have to go back to Council or is it a done deal now that they have the 75% retail occupancy? Mostly it will be nice to have something there. It looks very sad now.


       —Juliew    Feb. 13 '06 - 10:53PM    #
  2. You mean in that it has medical groups as the anchor tenant? They still have all of the other proposed uses – housing, retail space, etc. Though, comparing the square feet in the News today with their website, it looks like these “health care groups” are replacing not just the hotel and health club, but also some of what was originally intended for other commercial uses.

    I guess I would have preferred they stick to trying to get a hotel in the mix, which the article seems to indicate is an option, and in general as broad a mix as they were shooting for, but, having lived in the area for the past several years, I’ll be glad for this to go in as it’s now described – replacing the old Kroger with anything will be good, and hopefully putting all of this there will make the area less of a graveyard after rush hour than it is now. (The health care offices won’t help with that much, I guess, but the apartments and restaurants should?)

    From the article, it sounds like Council has to review and approve the prelease package regardless of who the tenants are.


       —TPM    Feb. 13 '06 - 11:16PM    #
  3. This is the second time that the developer has claimed he has met the 75% pre-leasing requirement. Last June (the first time), the City Attorney shot him down, pointing out that the proposed anchor tenant consisted of backers of the development.

    We’ll have to see what the City staff says about this package of leases. I expect it will be a couple of months before Council does anything one way or another.


       —David Cahill    Feb. 14 '06 - 02:13AM    #
  4. Huh.

    Well, I didn’t know about the hotel, but I’m glad it’s out of the picture now.

    I’d say it looks more than a little bland, but agreed, better than an abandoned parking lot.


       —Young Urban Amateur    Feb. 14 '06 - 05:17PM    #
  5. It’s so short and bland!
    But by Christ, I hope this means we get a decent bar in the neighborhood.


       —js    Feb. 14 '06 - 07:00PM    #
  6. Sorry JS, looks like you are getting a “Gilbert & Blake’s Seafood and Steak Grille,” a Michigan-based chain(?) started near Lansing. Some details are in this article. My favorite quote from this article: “It is a prototype for what we hope will be a chain, and what better place to develop that than right next door to Michigan State?” said Morris Huntley, vice president of operations for DMA Food Group. Yeah, what better place?


       —Juliew    Feb. 14 '06 - 09:01PM    #
  7. It probably won’t have everything that everybody wants out of it, but there are lots of other vacant or mostly-vacant lots in the neighborhood whose owners might be spurred into doing something once this goes forward.


       —TPM    Feb. 14 '06 - 09:33PM    #
  8. Yeah, that’s what I need. Another HP Pickleshitter’s in the neighborhood.


       —js    Feb. 17 '06 - 01:09AM    #
  9. I agree with Julie that the current set off tenants is far less attractive than the original proposal. It appears that the tenant list is moving further and further from amenities that benefit the local neighborhood. Perhaps TPM is right that the development of nearby lots spurred on by this project will provide a corner grocery or a corner bar. Shoot, folks over there would be happy to get even a mid-block grocery. However, I think “replacing the old Kroger with anything will be good” is going a bit overboard.

    I have a couple questions about the article:

    “Strathmore has also agreed to pay the city $500,000 annually for 30 years following construction.” What is this about? The article just leaves this figure hanging.

    Is medical considered “commercial”? I thought it was “office”.
    If it is better described as office space and the parking demand for office is about 4 spaces/1,000 square feet, then this UM extension will consume more parking than is provided on-site. Considering all of the fantastic transit and NMT improvements that are part of this development plan (none), I predict an application for a new Residential Parking Permit program on Broadway will be submitted in the near future.

    Is there any info on traffic studies done in conjunction with this proposal? I know that the Braodway neighborhood was concerned about the amount of traffic that would be flying up and down the hill, resulting in the irritating, ineffective, and eventually crumbling speed bumps on Broadway. I would think that all this office space is going to have a significant impact on the already heavy rush hour traffic at this junction.

    And finally, “It will also include a national coffee shop whose name has yet to be revealed.” This is a real nail-biter! Will it be Starbucks? Will it be… um, a national coffee shop that isn’t Starbucks? I’m at the edge of my seat!


       —Scott TenBrink    Feb. 20 '06 - 03:08AM    #
  10. That’s an interesting point you make about parking, Scott. Office uses are among the most parking-intensive uses there are.

    This project didn’t have enough parking with its old mix of uses. I shudder to think what will happen if all these offices come in.

    Broadway is already completely parked up during the daytime. So there will just be no place to park for the patients coming to see these doctors.


       —David Cahill    Feb. 20 '06 - 07:45PM    #
  11. Patients don’t need to park – walking is good for their health!

    It is a shame that this development is moving more towards national tenants. I know that having primarily local businesses was a goal of Peter Allen, but I guess without him Strathmore went for the whoever-will-give-us-the-most-money option. Or possibly, the whoever-will-prelease-this-far-in-advance option.


       —Lisa    Feb. 20 '06 - 08:46PM    #
  12. “Perhaps TPM is right that the development of nearby lots spurred on by this project will provide a corner grocery or a corner bar. Shoot, folks over there would be happy to get even a mid-block grocery.”

    There are actually two small groceries there already, though I don’t find them a subsitute for something like the old Kroger. It’d be interesting to know what the impact (positive or negative) might be on them.

    “Considering all of the fantastic transit and NMT improvements that are part of this development plan (none)”

    Well, the best way to ensure good transportation is to build in a place where the transportation situation is already pretty good. This site is on a couple bus routes, in walking distance of downtown, the medical center, etc., in addition to being on a major road (Plymouth). Seems like a pretty good location to me.


       —Bruce Fields    Feb. 20 '06 - 08:52PM    #
  13. A package submitted to the City exactly three years ago today called for 729 parking spaces, 640 of which were to be in a 6-story parking structure.

    Based on the proposed uses at that time, this amount of parking was not sufficient, considering both the City’s code requirements and a substantial reduction in parking according to the national standards for shared parking.

    I talked to Donna Johnson, the planning staff person on the project at the time, and asked her what had happened. She said that the developer had submitted its own shared parking analysis, and that the City had accepted it without confirming that it was valid.

    If and when the developer submits the new package of leases, and if and when the new site plan is submitted showing offices instead of a healthplex, I will re-do my analysis.


       —David Cahill    Feb. 21 '06 - 04:22PM    #
  14. In perusing the city code, I found that medical and dental offices and clinics have a specific parking requirement of 1 space per 150 square feet of floor area. That means 1133 parking spaces would be required just for the medical offices for this development. Perhaps some of the office space would be categorized as general office space. With a 50/50 split, the good doctors would require 825 spaces. If these are provided in the structure, that raises the height to 8-11 stories. Thank God you can’t see Lowertown from the OWS.


       —Scott TenBrink    Feb. 22 '06 - 08:59AM    #
  15. I just received a copy of a three-page letter dated May 17 which Stephen Postema sent to the lawyer for the developer. The letter is reported in today’s issue of Ann Arbor Business Review. Can someone link the article here?

    The letter is a classic in its field. Postema says that the developer has met the 75% pre-leasing requirement, but he raises a bunch of new issues. I have the letter as a .pdf file. Can someone tell me where to e-mail it so that it can be linked here also?

    Some issues mentioned:

    ** The letter says the developer has “only recently started to provide” a bunch of project information necessary for the City to adequately perform its due diligence. With regard to a recently-provided project schedule, Stephen says his first look “has disclosed not only that numerous items are already behind your projected dates to the City for implementation, but that the projected completion dates for such items are clearly understated, in some cases by what would appear to be a large margin.”

    ** Stephen said that the developer has “only this past week submitted its proposed administrative amendments to the PUD/site plan.”

    **The developer plans to move the construction of the big building (Building A) to phase 2. “This change is troubling to the City, insofar as the City’s underwriting of the Project, and analysis of the feasibility of the proposed bonds, are inextricably linked to the lease-up and timely completion and occupancy of Buiding A, whch repreent the lion’s share of the pre-leasing required under the Minimum Lease Commitment Requirement.”

    ** “The City needs further information about the environmental issues in this case. The DEQ already denied the remediation permit you submitted.”

    Postema suggested a meeting for May 26 at 8:30 a.m.


       —David Cahill    May. 25 '06 - 07:08PM    #
  16. A double super-secret meeting?


       —Dale    May. 25 '06 - 10:16PM    #
  17. The article David mentions: City raises issues with Lower Town developers


       —Murph    May. 25 '06 - 11:39PM    #
  18. Stephen came up to me at the Bar dinner this evening. He said that the City Council might do something on starting the process for issuing bonds at either its June 5 or June 19 meetings; the bonding process (which involves an independent investigation by outside bonding attorneys) will run parallel with the City’s own continuing study of the project.

    I asked if the proposed doctor tenants were real. Stephen said yes; he had gone and visited them.

    Earlier this afternoon, after I got his letter to the developer’s lawyer, I made a FOIA request for all the materials mentioned in the letter. Stephen said that a lot of materials would become available in the next month. He said he did not want to release the rental rates in the proposed leases. I said that I didn’t want to see them, anyway.

    I think it will be several more months, at the very least, before City Council will make a decision one way or another. The developer certainly has a long and difficult way to go, with all these new issues.


       —David Cahill    May. 26 '06 - 01:11AM    #
  19. I heard that with the Kingsley Lane project going back to raise the ht of their building and being approved, and many towers planned by the University on Wall Street, the Lower Town developers are in the process of going back and asking for more. This time it will be 10 stories! Finally some sanity.


       —Edmund Bacon    May. 26 '06 - 03:05PM    #
  20. Interesting news, Edmund! What’s your source? Got any more details?


       —David Cahill    May. 26 '06 - 08:45PM    #
  21. UM is going to be reworking some of its land in the Wall St. corridor, and part of that redevelopment is going to include the construction of a transit center (with integrated retail space, enclosed waiting areas, etc.)!

    Perhaps after this city sees this type of TOD in operation, we can begin to focus less exclusively on parking-oriented development solutions.


       —kena    May. 26 '06 - 08:59PM    #
  22. I just got a copy of the May 10 proposed administrative site plan amendments. There is no mention of a proposed increase in any building heights. There are small increases and decreases in building square footages.

    There are significant changes in proposed building uses, the net effect of which seems to be an increase in multi-family residential, retail and medical office, and the elimination of the athletic club and hotel.

    All the smaller buildings would be built in phase 1; the biggest one (Building A, which used to be the athletic club and hotel) would be built in phase 2.


       —David Cahill    May. 27 '06 - 02:59PM    #
  23. Check out item D-28 on the June 5 agenda. It is a very cautiously-worded resolution directing that the staff publish a “notice of intent” to issue the bonds for this project. The resolution points out that there are a variety of conditions yet to be satisfied before the bonds can be issued.

    Curiously, the notice of intent itself doesn’t mention any of the conditions. I hope that, if Council later decides that these conditions have not been met, the developer can’t argue that the unconditional notice means that the City has to issue the bonds.

    I’ve mentioned this problem to Stephen Postema.


       —David Cahill    Jun. 3 '06 - 03:20PM    #
  24. A group calling itself Citizens Advocating Responsible Development (CARD) started a petition drive yesterday to force a referendum on the $40 million in bonds that the City would have to issue in order to make Broadway Village a reality.

    Under state law, the petitioners have 45 days from June 18 (when the notice of intent was published in the AA News) to gather a bit more than 9,000 valid petition signatures.

    This method worked last year to stop the issuance of bonds for the County’s expanded jail.

    The group says it thinks the public should vote on whether or not to give $40 million to a private developer.


       —David Cahill    Jun. 24 '06 - 06:19PM    #
  25. “The group says it thinks the public should vote on whether or not to give $40 million to a private developer.”

    Meanwhile, the public wonders why this group is writing about itself in the third person…. (And in what sense this $40 million is a “gift”.)


       —Bruce Fields    Jun. 24 '06 - 10:58PM    #
  26. (“third person”: bravo, Bruce.)

    Meanwhile, Ann Arbor voters might wonder why vacant strip malls that are anxiety-producingly dead, even for the 20-something male pedestrian, by 9 pm are considered “responsible” to keep around.

    Ann Arbor voters might wonder why a $40 million dollar expenditure can be considered “giving” if the $40 million won’t exist unless the development happens – which it, and more, won’t.

    Ann Arbor voters might also wonder why allowing toxic concentrations of noxious dry cleaning chemicals to continue wending their way into the Huron River is considered “responsible”.

    Ann Arbor voters might finally wonder why they are letting themselves be fooled by such shallow uses of modifiers like “responsible”.

    (This one is forced, at this point, to speak in the third person when discussing Ann Arbor voters – my new address, in the 48197, makes me part of a vox populi that would no doubt happily take Broadway Village, and the tax revenue it would bring.)


       —Murph.    Jun. 25 '06 - 12:49AM    #
  27. Sure, the $40 million is a gift to the developer. The developer doesn’t have to pay it back. Instead, the property taxes are supposed to pay the $40 back – with interest. The total amount to be paid back, including interest, will be at least $80 million.

    Cleaning up the remnants of a dry cleaning operation will cost $4 million, and the city already has a grant for $3 million. So going through Rube Goldberg financing, and building a $185 million project, to do this small cleanup is a bit bizarre.

    I just talked to a petition circulator who was at the Farmers Market. She said that of those who said they were AA voters, about 90% signed the petition.

    So there is a lot of public concern about the proposed subsidy to a private developer.


       —David Cahill    Jun. 25 '06 - 01:11AM    #
  28. The developer doesn’t have to pay it back. Instead, the property taxes are supposed to pay the $40 back – with interest. The total amount to be paid back, including interest, will be at least $80 million.

    David, you’re contradicting yourself.


       —Murph.    Jun. 25 '06 - 01:20PM    #
  29. Group Starts Petition Drive On Broadway Village Bonds

    For Immediate Release June 26, 2006

    A local citizens group has launched a petition drive to force a vote on the Ann Arbor city government’s plan to issue $40 million in bonds to subsidize Broadway Village, a private development to be located at Maiden Lane and Broadway.

    The group, Citizens Advocating Responsible Development (CARD), is using a feature of state law which allows citizens to petition for a referendum before a local government can issue bonds. A similar law was used successfully last year to block the issuance of bonds to expand the Washtenaw County Jail.

    The group is required to gather slightly more than 9,000 valid signatures by August 1. If the petition drive succeeds, then the city could not issue the bonds until they are approved by the voters at an election. Last year, the County Board of Commissioners dropped the idea of an expanded jail rather than put the issue on the ballot.

    Laura Strowe, a spokesperson for the citizens group, says “The project is supposed to cost $185 million, and the city has to issue the bonds because the developer can’t get private funding for the entire amount. The city should not subsidize a project that the banks won’t completely fund.”

    If the project succeeds, the property taxes on the project would pay back the bonds, both principal and interest. The total amount paid would be at least $80 million over 30 years. This $80 million would not go to the local units of government that would ordinarily receive the property taxes. It would, instead, go to the bondholders.

    CARD is worried that the project will not produce enough tax revenue to make the bond payments. In that case, the city government might have to pay back the bondholders from tax dollars received from citizens, instead of just tax dollars from the project.

    “Times are tough in Michigan,” said Lou Glorie, a fifth ward petition circulator. “Now is not the time for the city government to gamble on a risky development.”

    Strowe said that in the first day of petitioning, about 90% of registered voters with whom she talked signed the petition.

    For further information, or to circulate a petition, contact: Laura Strowe, 665-8980.

    Paid for by Citizens Advocating Responsible Development, 1327 Broadway, Ann Arbor, Michigan 48105


       —David Cahill    Jun. 26 '06 - 01:09PM    #
  30. That’s quite a bit of passive voice.


       —Dale    Jun. 26 '06 - 01:21PM    #
  31. “CARD is worried that the project will not produce enough tax revenue to make the bond payments.”

    Ok, I’ll bite. How much are the bond payments Mr. Cahill?


       —todd    Jun. 26 '06 - 01:42PM    #
  32. “Ok, I’ll bite. How much are the bond payments Mr. Cahill?”

    Why am I starting to get the feeling that you and your group has no idea how much the bond payments run?

    Shouldn’t CARD have this number at the ready if they are “worried that the project will not produce enough tax revenue to make the bond payments”?

    This is beginning to look suspiciously NIMBY, Dave. Let’s see the numbers.


       —todd    Jun. 26 '06 - 09:14PM    #
  33. In 2003 and 2004 there were “prospective appraisals” by the City and County that showed the project would be worth far less than the value necessary to generate the taxes to make the bond payments. (The project had to be worth $80,000,000; both appraisals came in at $65,000,000.)

    Recently the Assessor told a secret City staff team that a new appraisal would be even lower. We’re waiting for the new figures.


       —David Cahill    Jun. 26 '06 - 10:53PM    #
  34. You didn’t answer my question. How much are the bond payments?

    ...and “secret City staff team”??


       —todd    Jun. 26 '06 - 11:13PM    #
  35. Please focus on this, todd: The issue is whether or not the taxes will cover the bond payments. So far the answer is no, they won’t. I don’t have figures at hand; the latest set is in the hands of a CPA.

    Yes, “secret City staff team”. I’ve got 13 pages of minutes from this staff team’s meetings, which were unknown to the public until the July Observer revealed the team’s existence.

    The relevant staff team meeting was on June 2. On June 5, Tom Crawford, the City’s CFO, told Council that the taxes would not cover the bond payments.


       —David Cahill    Jun. 27 '06 - 01:21AM    #
  36. Taken from your own press release, Dave:

    Post #29: If the project succeeds, the property taxes on the project would pay back the bonds, both principal and interest.

    See why I’m asking questions? So which is it? Will the project pay off the bonds, or not?

    More importantly, since math is clearly not your strong suit (nor is it mine), can’t you be kind enough to tell us how much the bond payments are, and when the payments are due? I know you have the numbers somewhere.

    This isn’t very complicated. If the bonds won’t be covered by the new taxes, we need to understand by how much, and evaluate whether or not this is a good idea.

    However, if, as your own press release claims, the bond issue will be covered by the new taxes, then aren’t you putting up a bit of a straw man??

    ......and Dave, if the taxes really don’t cover the cost of the bonds, and by a material amount: guess what? I’m probably on your side.

    So, out with the numbers, please.


       —todd    Jun. 27 '06 - 01:47AM    #
  37. Todd, ask your City Council member what s/he knew about the secret City team meetings and when s/he knew it.

    If the project does not succeed – that is, if the taxes are not high enough to pay off the bonds – the City’s general fund could take a big hit.

    From what I know, the storm signals are flying at the staff level about the taxes and the bonds. That’s good enough for me to support the petition drive.

    I have figures on the bond payments from three years ago somewhere in the huge pile of Broadway Village materials rotting in my study. But the project’s cost has grown dramatically – from $120 million to $185 million – so what I have won’t help.

    I assume you will join me in signing the petition, so that we can have an informed public debate about the project’s funding, and an informed vote.


       —David Cahill    Jun. 27 '06 - 12:44PM    #
  38. Wouldn’t it be better to devote the considerable time and energy of the members of CARD, the City, and the developers to help to make this development the best it can be, rather than find the ways to block it? It kills me to drive by the bombed out remains of what used to be a thriving, interesting, useful part of town. I spent a lot of time in this area as a child and teenager and hope to someday see it become something at least as good as what used to be there.


       —Juliew    Jun. 27 '06 - 01:10PM    #
  39. “Wouldn’t it be better to devote the considerable time and energy of the members of CARD, the City, and the developers to help to make this development the best it can be, rather than find the ways to block it?”

    Yeah, well, this is where acting in a disingenuous manner gets Dave into trouble. If all that CARD was doing was ensuring that the tax math behind this project was on the up and up, then the fine folks at ArborUpdate would be behind them.

    Obviously, now that I’ve asked a few mind-numbingly simple questions, we see the CARD has no interest in the math. They don’t even know how much the bond payments are going to run, and their own press release contradicts itself on whether or not this project will pay for the bonds.

    CARD’s mission, obviously, isn’t to make sure that the math works. Their mission is to send a confusing message to potential petition signers, so that they can “Vote” (ie, vote no) on whether or not this large project will be built.

    JulieW is indeed correct that the logical course of action for CARD is to work with the city to ensure that the bond math is correct. Unforunately for Dave, her “weasel-o-meter” picked up the same readings that mine did: CARD wants to block this project. Period. Why else would they want to submit this to a vote?

    Dave, if Karen didn’t already win the “Selfish Twit of the Week” on another thread, you’d be the proud owner of a Disney soundclip.

    I am sure you are disappointed. Maybe (probably) next week…..


       —todd    Jun. 27 '06 - 02:14PM    #
  40. This sounds fishy.

    David: “I have documents showing that the taxes from the project will not be enough to make the bond payments!”

    Todd: “Oh, really? Let’s see the numbers.”

    David: “Let’s sign this petition so that we can get some information about about the bond payments!”

    It seems to me that if CARD had copies of secret documents from the city, then it would be in their best interest to offer them up at the start, rather than claiming to have them but refusing to offer any proof. Yawn.


       —TPM    Jun. 27 '06 - 02:38PM    #
  41. “Yes, “secret City staff team”.”

    What? They don’t have a public announcement every time a group of city employees gets together to discuss a city issue? I’m shocked.


       —John Q.    Jun. 27 '06 - 03:53PM    #
  42. In 2003 similar meetings, of a committee created by Council, were open to the public. These latest meetings aren’t.

    I, too, would like to see something decent in that space. However, Broadway Village isn’t that project.

    I have a .pdf file of the minutes of the secret city team. I’ll e-mail them to Juliew. She should feel free to put a link to them here. Then what you can read yourselves what the Assessor’s Office is saying.

    Yes, there certainly is something fishy going on here!


       —David Cahill    Jun. 27 '06 - 06:17PM    #
  43. “I, too, would like to see something decent in that space. However, Broadway Village isn’t that project.”

    And there we have it, ladies and gentleman. It’s kind of like getting a five year old to sheepishly admit that he’s the one who ate the cookies.

    I’m completely surprised that Dave has no idea how much the bond payments will run. This has nothing to do with bonds: who could have guessed?

    Am I the only one who finds it ironic that Dave is complaining about the City being secretive and disingenuous, and then in the very next breath…...


       —todd    Jun. 27 '06 - 06:45PM    #
  44. I love Dave’s math. He states that since the cost of the project has gone from $120 million to $185 million, the previous financial projections are no longer valid. But if the math worked when the project was $120 million, why would it no longer work at $185 million, especially since the City’s share is still $40 million? True, the cost of the project doesn’t necessarily translate into future value. But unless there’s some significant additional cost that’s providing no value to the future bottom line, the fact that the developer is going to spend more on the project seems to bode well for a future value in excess of what the value was projected when the project was $120 million. I guess we’ll just have to wait on Dave and his supersecret documents.


       —John Q.    Jun. 27 '06 - 08:53PM    #
  45. David Cahill,

    The Acrobat Reader has a ‘text-select’ tool that can be used to select text from a .pdf, copy it and paste it into the AU comment window. While possibly not practical for prodigious amounts of text, perhaps you could provide a preview of the most pertinent passages for people to peruse and ponder while the posting of the .pdf’s in their entirity is pending.


       —HD    Jun. 27 '06 - 09:45PM    #
  46. I’ve sent the .pdf off to juliew. I don’t think it’s practical for me to post excerpts from the minutes. Besides, those who are in the longest river in Egypt (“denial”) about Broadway Village’s problems would simply say that the excerpts were out of context. 8-)

    The word of the city’s CFO that the taxes aren’t enough to pay off the bonds is good enough for me.

    Meanwhile, the petition drive continues apace. Watch for us at the Top of the Park, at the Farmer’s Market, in movie lines – wherever Ann Arborites gather.

    Interestingly, the largest number of our circulators are from the fifth ward, though the project is in the first ward. So this is, indeed, a city-wide issue.


       —David Cahill    Jun. 28 '06 - 01:29AM    #
  47. “The word of the city’s CFO that the taxes aren’t enough to pay off the bonds is good enough for me.”

    Terrific.

    JulieW, if you have the time, can you please post the portion of the minutes that explains the tax and bond math?

    You’d think that an organization (CARD) that is taking the time to circulate a petition decrying the lack of financial balance in this bond project would have the numbers that show this imbalance at the ready.

    I guess that’s too much to ask.

    Thanks, JulieW.


       —todd    Jun. 28 '06 - 02:02AM    #
  48. So Mr. Cahill, you actually trust a city official, the CFO? A quick read of the July Observer “Eyes on Lowertown” reveals that the city is quite on top of this whole issue. After reading it I have no doubt that they are taking great care and will not issue bonds beyond what the project can support. What makes you think otherwise? Some secret agenda? If so, what is it?


       —Dustin    Jun. 28 '06 - 02:52AM    #
  49. The citizens group thinks that subsidizing private development to this extent is a bad idea, even if there were no risk to the general fund.

    Yesterday a petition circulator attended a meeting of influential Democratic women called the “Lunch Bunch”. People at the meeting did not want any explanations; they had already heard of the petition, even though it hasn’t got any media play yet – except here. (Hello, all you Lunch Bunch lurkers!)

    They all signed the petition.


       —David Cahill    Jun. 28 '06 - 11:09AM    #
  50. Up to now, the AU discussion has focused on the question of whether there’s a risk to the general fund, where that risk is defined by the difference between bond payments and revenue from property taxes. And that discussion has temporarily stalled on the question of what the actual numbers are.

    But if the position of CARD is that the issuing of the bonds is a bad idea “even if there were no risk to the general fund,” it would be constructive for the group to advance an argument to this effect.


       —HD    Jun. 28 '06 - 11:59AM    #
  51. So Mr. Cahill, this is all about stopping the city from subsidizing the redevelopment of a blighted, paved over, polluted, vacant strip mall site, something that cities everywhere need to do sometimes and not about the fact that the site is just down the street from your house?


       —Dustin    Jun. 28 '06 - 12:47PM    #
  52. From the EPA’s P3 Success Stories: “As urban areas continue to grapple with the environmental and social consequences of sprawl, creative new plans to manage growth must be explored. The city of Ann Arbor, Michigan, has been battling urban sprawl for decades and is currently focused on revitalizing existing urban areas as a result of the city’s recent greenbelt initiative. The Lowertown neighborhood has been targeted as an area ripe for urban redevelopment. This area of the city has been underutilized for decades, yet rests within one of the most ideal and accessible locations in Ann Arbor. Over the past three years, business investment has slowly returned to Lowertown and citizens groups have begun to develop a master plan for this emerging neighborhood.”

    “I, too, would like to see something decent in that space. However, Broadway Village isn’t that project.” David Cahill

    Mr. Cahill the way I see it you are now firmly on the hook to describe your vision in detail. We all hate the NIMBY responses to progress that are couched in the specious argument that goes, “I am not sure what should go there, but that is not it.” Describe that ‘something decent’ that you see taking the place of the abandoned grocery and the parking lots. Help to build this process instead of just tearing it down. What will the people of CARD support?


       —abc    Jun. 28 '06 - 01:10PM    #
  53. It’s pretty fucking obvious what they’ll support. Doesn’t anyone else see it yet? They’re just greasing the skids in preparation of sliding the whole discussion into Greenway Eastside: The Sequel. Because why should such an amenity as an imaginary Greenway be limited to just one part of town? And why just a stream valley? Why can’t it pop up here and there, wherever it’s needed? After all, most rich people live on hills.

    So just watch this discussion evolve. Pretty soon they’ll be speaking of the Greenway extension as though it’s been a forgone conclusion for years, something for which they were right on the verge of breaking ground when these pro-development maniac planners showed up and tried to ram condos down their throats. Just like Margaret had been out there in that parking lot for years, personally scrubbing up grease stains in preparation for the long-planned First and William Nature Preserve.


       —Parking Structure Dude!    Jun. 28 '06 - 01:44PM    #
  54. I was away from a computer yesterday afternoon so wasn’t able to do anything with the .pdf David sent me. I have now forwarded it to Murph so he can do his magic on it and post it.

    This area of the city has been underutilized for decades
    OK, so why is a grocery store, a laundromat, and several small locally-owned stores an underutilized use and a doctor’s office complex is not? Isn’t the former exactly what we would hope to see in a residential area. That is actually contributing to livability of an area. A lot of talk has gone into how this is such a great site and how people are vying for the opportunity to build here, but it has been demolished for over a year now and a viable project has been slow to materialize. So I guess I’m on both sides here. I really want to see something built here (especially now that everything has been demolished) and I didn’t mind the original mixed-use proposal, but I think the development and tenants currently proposed sells the history, the neighborhood, and the city short. Did the City make a mistake in marketing this site? Was the wrong group chosen to develop it? What exactly happened here and why? How can we make it better now without killing the entire project?


       —Juliew    Jun. 28 '06 - 02:21PM    #
  55. “The citizens group thinks that subsidizing private development to this extent is a bad idea, even if there were no risk to the general fund.”

    Mr. Cahill, please inform the “Lunch Bunch”, as well as anyone else who is against private business “subsidies” (man, I HATE that word) that my business, as well as countless other local businesses in town, would never have opened their doors without an SBA loan that was guaranteed and therefore ‘subsidized’ by the good people of the State of Michigan.

    This developer, a Michigan based business, is risking their capital to help clean up a Brownfield site, and bring high paying jobs to a centrally located part of town. Area restaurants and stores will benefit from this project, and when the bonds are paid off, the city will enjoy the new infastructure, as well as millions of dollars in tax revenue.

    Cahill: “The citizens group thinks that subsidizing private development to this extent is a bad idea, even if there were no risk to the general fund.”

    This is simply too funny for words. This group, hiding behind a bunch of bs about bond numbers is outed by the some moron (me) who asks one simple question: “hey, how much are the bond payments?” Revealing that they are circulating a dishonest petition (you should be embarrassed) that is nothing more than a NIMBY effort to kill yet another project.

    You reap what you sow, Dave. Don’t ask for transparent government when you circulate a dishonest petition. The press release from CARD doesn’t discuss any other aspect of the Broadway Village project other than the bonds….and then you go on to say that CARD wants a vote “even if there were no risk to the general fund.” In other words, the financial solvency of the bonds aren’t at issue at all.

    Way to go, Dave!


       —todd    Jun. 28 '06 - 02:24PM    #
  56. “How can we make it better now without killing the entire project?”

    Note the difference between David’s approach and JulieW’s approach to the Broadway Village project.

    This is why I’d vote for JulieW to a seat on City Council or the Planning Commission. I don’t agree with many of her views on development, but you know what? I don’t care. She’s asking good, honest questions about projects, and she is not working from some hidden agenda.

    She wants what’s best for Ann Arbor, and while her vision is completely different from mine in many respects, the important thing is that she is asking the right questions.

    Bravo, Julie.

    BTW, I don’t have any answers to your current questions about Broadway Village. I’ll have to do a little research.


       —todd    Jun. 28 '06 - 02:31PM    #
  57. Thanks Todd, but I’m just one of many. There are a lot of people out there who aren’t so polarized and who just want to make Ann Arbor work pretty well for the widest variety of people. Unfortunately, these aren’t usually the people who speak up. Mostly the people you see quoted in the paper or at City Council meetings have really strong viewpoints on one side or the other. We need them to galvanize the rest of us, but in general, I think the majority are pretty reasonable and open to discussion given the opportunity.


       —Juliew    Jun. 28 '06 - 09:54PM    #
  58. Here’s the file David provided:

    Broadway Village Minutes, April/May 2006

    As I read them, I’m not seeing any statement by Tom Crawford like David is quoting – David, were you referring to separate statements made at a Council meeting? Crawford’s statements in the minutes provided are in the style “more information is needed”.


       —Murph.    Jun. 28 '06 - 10:17PM    #
  59. Juliew—
    You’re so right. I felt trapped in the middle when this whole Greenway thing started. I wanted to get information, but I felt that the DDA folks were being unnecessarily harsh in labeling anyone who considered a Greenway as a loony leftist, and the Greenway folks tended to be “greenway or the highway.” All I want is something that makes sense and that improves the quality of life. If that means parks on the edge of downtown but not a “full scale greenway”, then great.

    It is just amazing to me how polarizing this debate has been since the beginning.


       —Young OWSider    Jun. 29 '06 - 12:56AM    #
  60. I just saw this.

    I. Give. Up.

    Have fun, Ann Arbor. I’m not long for this town. With any luck I’ll soon be in a city where citizens understand, and celebrate, what living in a city means. And don’t have so much free time on their hands. I highly doubt that this sort of endless trifling “progressive” “activism” is happening in Chicago, Portland, or even Grand Rapids.


       —Brandon    Jun. 29 '06 - 02:23AM    #
  61. Brandon,

    Sorry to be the bearer of bad news but this kind of shenanigans goes on in most “progressive” cities. The difference is that most of the cities that you listed are much larger in size than Ann Arbor so good things eventually do escape the the efforts of the Cahills of the world trying to beat down anything that might disrupt the status quo.


       —John Q.    Jun. 29 '06 - 03:26AM    #
  62. “The difference is that most of the cities that you listed are much larger in size than Ann Arbor so good things eventually do escape the the efforts of the Cahills of the world trying to beat down anything that might disrupt the status quo”

    You know, when my brother and I talk about needing more space for our distilling operation (eventually), people are surprised when we tell them that there is zero chance that it will be in Ann Arbor. Speaking with the Greffs about their positive experience in Ypsi certainly had us take note.

    This thread explains why opening a business in Ann Arbor can be financial suicide for a small business:

    It’s true that rents and taxes are high, and are very difficult and in many cases impossible to overcome. It’s also true that foot traffic is down in much of downtown. And though we just had the best June sales we’ve had in our history (dumb luck) in this very market, we’d never try a second location in this town.

    Yes, rent and taxes are probably too high for us, but the real reason is that if we purchase a building or site to be redeveloped, and end up in the crosshairs of a group like Cahill’s (and there’s a ton of ‘em), we’d go bankrupt before we ever opened our doors. And best of all, there is no possible way that you can tell if you are going to be in the crosshairs.

    The uncertainty of an actual opening date is too much for any financial spreadsheet to handle…..


       —todd    Jun. 29 '06 - 04:06AM    #
  63. Taken from the minutes of the 3/7/06 Council meetings.

    The agenda item being discussed is “Public Hearing and Action on Adoption of Northeast Area Plan as an Element of the Ann Arbor City Master Plan—Staff Recommendation: Approval”

    It’s quite an interesting read. I didn’t see a single person who did not enthusiastically support the Northeast Area Plan (e.g., people like Chris Crockett, residents in a large condo project), which, among other things, called for more dense development in the area…..

    Oh, I’m sorry, I forgot. There was one person who was against the NE Area Plan. Here’s the minutes excerpt that includes that person’s comments:

    “L**** S*****, 1327 Broadway, said she was interested in the Northeast Area Plan because there have been several situations where it was used as a defense for a development she did not like (my emphasis added). The first time, she said, was during the Broadway Village project, which she thought was a horrendous plan. She said it was a huge, dense development in the middle of a low-density neighborhood. However, she said, when the project was discussed, the draft Northeast Area Plan was used to defend the project. She said she recently attended a meeting with University planners, who said their plans to develop Wall Street/Maiden Lane were in keeping with the draft Northeast Area Plan. She did not believe that either of the Broadway Village or University plans complied with the intent or vision of the draft plan. Her concern was that somehow this plan could be used by developers as they see fit and she wanted to make sure that it was used correctly so it protected the citizens and the community.”

    In case you haven’t already figured it out, the commenter’s address is strangely identical to the business address for “CARD”....and this address is strangely close to the Broadway Village project.

    One could almost say that Broadway Village was nearly in “CARD’s backyard”.

    ......and yes, I was laughing myself silly when I came across the notes from this City Council meeting after I googled “CARD’s” address to see if it was really Dave C.

    Hoo-Boy, you just can’t make this stuff up. Where can an interested party get an official “CARD” hat and t-shirt?...... is really the only question I have left.

    Free advice to Dave and “CARD”: if you are going to concoct some bs story about your fake concern for the fiscal health of Ann Arbor, and how the “secret city commitee” was somehow just going to approve these bonds without checking the math, and without ensuring that the city bears little or no risk…...at least have the fake numbers ready so that the rest of us don’t immediately realize that you’re full of it.

    Or better yet, just be honest about why you don’t want Broadway Village built.

    Link to referenced excerpt:
    http://www.ci.ann-arbor.mi.us/CommunityServices/
    Planning/Planning/minutes/03-7-2006.pdf


       —todd    Jun. 29 '06 - 06:21AM    #
  64. God, this city hates its young.

    And sorry, Dave, but fuck you for trying to keep my neighborhood shitty. I bet you’d be fighting against a decent bar/evening restaurant over here too. Douche.


       —js    Jun. 29 '06 - 03:31PM    #
  65. Re: development shenanigans in allegedly progressive communities.

    The debates never fundamentally change; they just scale up. See the following from the Chicago Journal in which neighbors cite concerns that the building will cast shadows and is out of character with the surrounding neighborhood.

    Of course, the dispute centers on a proposed 80-story mixed use tower in the South Loop, where existing zoning would allow about 40 stories.


       —Jeff Dean    Jun. 29 '06 - 07:42PM    #
  66. The debates never fundamentally change; they just scale up.

    And this one in Brooklyn.


       —Juliew    Jun. 29 '06 - 08:36PM    #
  67. I guess I’m glad we don’t have Gehry working in Lower Town, at least. Blech.


       —Brandon    Jun. 29 '06 - 08:56PM    #
  68. Test. I’ve entered two comments in the past two days which appeared to be posted, but which weren’t. This is a test.


       —David Cahill    Jun. 30 '06 - 04:02AM    #
  69. Yeah, you need to holler back Dave, because those of us keeping score at home have Todd up about 27-2. We’re being generous with the 2.


       —tim    Jun. 30 '06 - 05:04AM    #
  70. “Yeah, you need to holler back Dave, because those of us keeping score at home have Todd up about 27-2. We’re being generous with the 2.”

    Hey, I’m not the only one who’s asked questions of Dave here. It just so happened that I asked the dumbest question of all.

    And don’t forget that I was the one who was dumb enough to halfway believe that Dave C. was sincerely alerting us to poor accounting procedures at City Hall.

    And if any of you believe that Dave’s been “trying to post” for the last two days, I’ve got a petition for you to sign that will help block the purchase of the Brooklyn Bridge.

    More comedy to follow, I am sure. Get your popcorn and milk duds while you have the time.


       —todd    Jun. 30 '06 - 05:32AM    #
  71. ah yes todd, but you are one who ask the direct questions that deserve direct answers. dave, you’re giving sophists a bad name. at least they could fool some of the people some of the time.


       —Tim    Jun. 30 '06 - 10:22AM    #
  72. Hey, I want to know more about this shadowy “Lunch Bunch.” Someone needs to do a Goodspeed-style expose like he did with Michigamua, posting names as they surface.


       —ann arbor is overrated    Jun. 30 '06 - 04:18PM    #
  73. Ah! I’m in California now for my son’s wedding and have been using a computer which somehow doesn’t tell Arbor Update properly to remember me. So let me reconstruct my postings.

    Murph, the June 2 team meeting minutes contain the reference to what the Assessor’s office is saying. Tom Crawford was not at that meeting. Then, at the June 5 meeting of City Council, Crawford told the assembled multitudes that the taxes were not enough to make the bond payments.

    With regard to those payments, todd (and others), I’ve finally remembered more details from 2003. At that time, the staff produced a spreadsheet showing how much in taxes the project would need to generate to pay off the bonds. It showed a tax “capture” for each tax millage involved, for each year. The project was assumed to increase in value each year along with the general increase in taxable values for similar properties, so the total capture increased year by year. There was an interest rate assumption built in to the spreadsheet; sorry I can’t remember what it was.

    Anyway, the spreadsheet did not contain an amount for the grand total capture. I laboriously added up the grand total. It was $95 million. This amount would pay off the principal of the bond issue (45 million) and the interest ($55 million).

    If we assume that the payments to the bondholders were constant from year to year (as they would be for a house mortgage), instead of steadily increasing, then we can immediately get a figure for annual bond payments: $95 million / 30 years = $3.17 million per year.

    I am sure there is a type of municipal bond which has payments increasing from year to year, instead of the steady-payment type. I presume that is the kind of bond that the city is intending to purchase. Sorry I don’t have more info about this.

    Now it’s 2006. Council member Bob Johnson told a meeting at the Northside Grill last week that the principal an interest on the bonds would total $80 million. If he is right, then constant annual payments would be $80 million / 30 years = $2.67 million per year.

    Can anyone here tell us what interest rate a typical tax-exempt municipal bond is going for now? I think the rate is higher now than it was in 2003, which should mean higher payments now than then.

    All these calculations assume, of course, that the project actually brings in enough taxes. The fact that the staff is working hard on a “reality check” for the project is good. But we should not (literally) bet the bank on their results. Remember that both the city and the county did prospective appraisals of the project in late 2003 and early 2004 which showed that the project’s value was far short of what was necessary: it had to be $80 million and the appraisals both came in at $65 million.

    Did this failure prevent Council from approving a development agreement in 2004, or from publishing that notice of intent to issue bonds?

    No.


       —Dave Cahill    Jun. 30 '06 - 04:34PM    #
  74. Mr. Cahill, you acknowledge that this issue is being carefully studied as reported in the July Observer. But, because you do not trust the City CFO and Attorneys, highly trained people, and because you don’t trust the city council, people who are elected for the most part by huge majorities, by the people of this city, we need CARD to protect us. Keep in mind that if the bonding has to wait until after the Nov. election, the interest rates are likely to be higher and thus it will cost more and the chances are greater it will not be built. Isn’t this all about delaying/stopping a needed development because it is down the street from your house? What makes you think the city would issue unsupported bonds? Why would they not just step away from the project if the numbers don’t work? Why do we need CARD?


       —Dustin    Jun. 30 '06 - 08:48PM    #
  75. Man… I’m hungry, can’t we just go find some barbeque ?


       —Rodney    Jun. 30 '06 - 10:55PM    #
  76. I don’t know Rodney. I’m just the out of focus guy.

    It’s too late, Dave. The jigs up.

    .....end of thread.

    p.s. It’s still funny.


       —todd    Jun. 30 '06 - 11:11PM    #
  77. Yeah, funny like a gallows.

    The best attempt at getting something built here may just be the first; if this fails another developer will think twice about jumping in. I don’t want to see this area languish in its current state for the next 5 years, or more, and I do not know why CARD does.

    It is clear that DCahill has been positioning to help this project fail for some time. Read post 23 carefully, where he is makes sure there are nails for the coffin. No detail too small…


       —abc    Jul. 1 '06 - 12:13PM    #
  78. “Yeah, funny like a gallows.”

    abc, part of the humor here (at least from my perspective) is that an awful lot of people read Arbor Update….Council Members, Planning comm., politicos…...and this is, ironically because of the groups like CARD, a very small town. This group and these people have lost credibility, and that will make a difference in the end.

    The good guys are winning. The freeze-Ann Arbor-in-amber-by-any-means-neccessary crowd is losing. Over last last few years, the curtain has been pulled back, and their positions have been shown to be selfish, untenable, and not in the best interest of Ann Arbor.

    Council and others are realizing that groups like CARD should be ignored. This thread shows why.

    But I should also say that my extreme viewpoint (remove all restrictions on building heights/size, and focus on sustainable, pedestrian friendly, solid designs) should be disregarded as well.

    Why? Because it is so far away from what the bulk of Ann Arborites want, that my views/participation would slow down the process of quickly finding the middle ground, and executing the plan. This is why I’d make a poor Planning Commissioner, and an even poorer Council Member.

    The NorthEast area plan cited above is evidence that the good guys are winning. It was endorsed, supported by everyone who spoke (almost), and it is now essentially a contract between citizens and developers.

    Hopefully, it will be followed for all projects, and the public/private partnership that’s been so sorely missed in Ann Arbor can finally begin, and new construction can finally support and enrich the goals of the community as a whole. Single citizens, or small noisy groups of citizens, will no longer be able to hold developers and the rest of the city hostage because they won’t be allowed to kill individual projects.

    That’s my hope, at least.


       —todd    Jul. 1 '06 - 02:42PM    #
  79. Gee, todd, here I’ve given you your long-sought info on the bond payments and all you can say is that it’s too late? Hahahaha!!!!
    What an idiot.

    I would just like to point out for Dustin and others that if this project were so badly “needed” the market would support building it. Once again, for those who may have missed the essential point: This project costs more to build than it’s worth. This extremely rare circumstance means that such a boondoggle requires a public subsidy. That’s why the bonds are needed, and that’s why the petition drive.


       —Dave Cahill    Jul. 1 '06 - 02:59PM    #
  80. Nearly every private project in a city that requires significant parking, ie. a structure, needs a subsidy. That is why developers build in green fields, acres and acres of parking. The DDA supplies this subsidy in the way of parking downtown but Broadway Village is not in the DDA district. All this proposal really does is set up a new Tax Increment Financing zone, another DDA if you like. Without the city and state particpation and the brownfield money, this will be another strip mall or perhaps as you prefer, it will remain the way it is, blighted and abandoned with the pollution closing in on Traver Creek and the River. Just as it has been for the last 10 years.


       —Dustin    Jul. 1 '06 - 03:45PM    #
  81. Call me all the names you want if it makes you feel better, Dave….you’ve already showed everyone here the hand that you and CARD are playing (pun intended), and all the numbers that you can cobble together at this late date won’t change that fact. You and I both know that you don’t mean it when you call me an idiot. Your bluff was called, so just let it drop.

    Oh, and Dave: congratulations on your son’s wedding. I’ve said this before: while we are obviously on different sides of the fence, and I disapprove of your political methods since I am not a political animal, one of these days we’ll have a beer or two. I’m sure we’d get along just fine….as long as neither of us mentions Ann Arbor. Which is fine by me.

    p.s. I sincerly hope that you and CARD drops this charade when you find out that the City has no intention of issuing bonds without insuring the City’s financial security.


       —todd    Jul. 1 '06 - 04:04PM    #
  82. While not endorsing Cahill or CARD at all, one must still note re

    “Single citizens, or small noisy groups of citizens, will no longer be able to hold developers and the rest of the city hostage because they won’t be allowed to kill individual projects.

    That’s my hope, at least.”

    , that a qualifier of “unreasonable” should have been added to “citizens”; if a reasonable citizen (or group) who is on the side of right has no power to “kill” an individual (unacceptable or deleterious-to-public-interest) project, then democracy and good government have gone out the window.
       —David Boyle    Jul. 1 '06 - 05:12PM    #
  83. You lose once again, todd. The date is not “late”. The petition drive runs for another month. What bluff? I provided you with everything you asked, despite your claims of my dishonesty.

    There is a history on this project of the City (i.e., the City Council) going ahead with various approvals even though the staff has repeatedly said (and is still saying) that the project will not be worth enough to pay off the bonds.

    Hence the petition drive.

    I know that a lot of people on Arbor Update are passionately in favor of development. However, the Ann Arborites who do not have a financial or professional interest in new construction (and they are in the vast majority) are the ones who will decide what happens to Broadway Village.

    The beauty of a petition drive is that those who don’t favor it can’t stop it. All they can do is sweat out the petitioning period. 8-)


       —Dave Cahill    Jul. 1 '06 - 05:53PM    #
  84. “There is a history on this project of the City (i.e., the City Council) going ahead with various approvals even though the staff has repeatedly said (and is still saying) that the project will not be worth enough to pay off the bonds.”

    I see evidence from, for example, those meeting minutes, that staff is being (appropriately) skeptical about claims of the projects worth. Have they really come to any final conclusions, though?

    I thought those “approvals” already explicitly included clauses that make final decisions depend on answers to the questions you’re worried about?


       —Bruce Fields    Jul. 1 '06 - 06:26PM    #
  85. Dave Cahill wrote: “The beauty of a petition drive is that those who don’t favor it can’t stop it. All they can do is sweat out the petitioning period.”

    Sweating, maybe. But could be this is the kind of sports drink those who oppose the petition drive are sipping: they flat out think that if it shows up on the ballot, that they can win the day at the polls; and if they win at the polls and the project is a success and the bonds get paid off with room to spare, a win for the City and the city; but if they win at the polls and the project is a flop and general fund money has to bail out the bond payments, well, who approved it, the People, that’s who.

    My sense from reading through the minutes of the meetings of the City staff is that the City has in some cases just taken the developer by the scruff of the neck and said, Hey, that’s not good enough, or that’s not realistic, do it over, do it again. So at this point I’m reasonably confident that the City isn’t going to expose us to unreasonable risk, and that they will walk away if the numbers represent an unreasonable risk. In any case, I would prefer that City staff and my elected officials take responsibility for it, because they have an accountability that the electorate does not.

    Dave Cahill, any possibility you’d post a running total of signatures gathered?


       —HD    Jul. 1 '06 - 06:44PM    #
  86. Sigh.

    OK, I tried to wave the white flag, but to no avail. No complaining from the peanut gallery….I tried to stop this.

    Here’s my assertion, Dave, in plain, simple English: The City has no intention of issuing these bonds unless the bonds payments are covered by the taxes.

    Here’s an excerpt from Tooter Talk with Homeless Dave, where he is discussing, among other things, the situation with Broadway Village with 1st Ward Councilman, John Roberts.

    JR: Well, I think, unfortunately for me, I have not had an opportunity to really look in complete detail at how that’s being set up from a financial perspective, to be able to give you great detail on it. But at a very high level, there are certain things that the developer was looking to do. And they needed some financing in order to make that happen. By us providing bonds, it would allow them to get the project going and get it done. But then they are paying back those bonds over the years through the taxes that will be built off the parking structure there. And the city will own the parking structure. The question becomes whether the revenues that are being generated are enough to pay back the bonds. And …

    HD: ... so is that the only source of revenue that the bonds can be paid back out of, or can the City say to the developer, Look, the …

    JR: ... well, it’s also based off the taxes. The taxes from the property will help pay back those bonds also.

    HD: So taxes, and then the parking structure revenues, and are there other sources? I mean can the City of Ann Arbor say to the developer, Look, it turns out that the property taxes and the parking revenues, they are falling short of what the bond payments are, and we don’t really want to dip into the General Fund, or whatever fund has to be dipped into, so we need you to throw in some more?

    JR: This is something that’s new for the City. And that’s why the financial group, Tom Crawford [CFO] and his group, are being very diligent to make sure that the City is not exposed in any way on this deal. Before we move forward and say that this is a Go on this deal, we’re going to make sure that all the loopholes are closed and that the money is going to be there to pay back these bonds.

    HD: So the City hasn’t made a decision to issue the bonds yet?

    JR: Correct.

    HD: It’s still possible to say, You know what, we’re just going to walk away right now?

    JR: Correct. Right. And I think that that’s the whole misnomer of this whole thing with the bonds is that we as Council approved the intent to issue those bonds. We needed to do that because of the lag time that it takes from issuing that intent. There’s a 45-day window there. But in no way shape or form are we obligated to issue those bonds. Up to this point and currently, Tom Crawford and his group, and there are City sub-committees that are working with the developer, to make sure that they’re meeting certain performance standards. As they hit those performance standards, it’s minimizing the risk that the City’s at. So that’s where things are there. And as far as Lower Town goes, I will say this, that Lower Town was a project that from a site plan perspective was approved before I was ever on Council. I’m not going to sit here and say that I agree with the project or disagree with the project, because that’s a moot point. That would be arguing that horse has already left the barn there. There were certain stipulations and contingencies the developer has to meet and it’s my job at City Council, and for staff, to make sure that they are meeting those and that the City’s not exposed.

    There you have it, spelled out by a Councilman.

    Dave, this doesn’t mean that I don’t like you!

    Now go outside and enjoy your new addition to the Cahill family, you crazy little “El Guapo”!

    Referenced website: http://www.homelessdave.com/
    tt20060629johnroberts.htm


       —todd    Jul. 1 '06 - 06:46PM    #
  87. Okay Dave, you’re confusing me. I’ll go so far as to give you an attempt to educate me, though I doubt you will, as I and many others think you’re hiding behind numbers.

    So from 2003/2004 to 2006 the principal and interest on the bonds has changed by $15 million. from 95 million to 80 (though i don’t know how 55+45 adds up to 95) so we have a 16% change there. i’m getting these figures from post 73. I’m not sure why it has changed, but whatever. i was a politics major and we were never interested in the facts anyway.

    Now, we’re working with an assessment done 2 1/2 years ago or so. i don’t know much in this crazy, mixed up world, and i know even less about assessments, but what if a new tax assessment went 16% higher (75.40 million for those of you at home)? would it change depending on what was built? did they assess with or without a hotel? would the assessment change if they knew that all of us that live within a quarter/half a mile (CARD members excepted) would jump at the chance to have some retail/dining/shopping in that area? would more or less parking affect the assessment? would medical vs commercial change the assessment?

    again, i don’t know much about city financing, but neither do most people who are going to sign your peition, dave cahill, so if you make things clearer for us we might be more inclinced to follow your position…or clarity could leave us rolling on the floor in laughter. either way, i’d be interested in having a more educated party address what i perceive (rightly or wrongly) to be some inconsistencies.


       —tim    Jul. 1 '06 - 06:49PM    #
  88. Todd, it’s really great to have John Roberts come forward and say the things he said in the materials you quoted. Remember, though, that Roberts represents the First Ward, where the project would be, and that his predecessor, Kim Groome, forcefully opposed the project. So does Council member Bob Johnson. I would feel better about Council’s caution if Mayor Hieftje, Jean Carlberg, or Leigh Greden were saying the same things. So, far, though, silence from them.

    In fact, Council and other decisionmakers appear to have vanished from Arbor Update. A while ago, we would see comments from one or the other people with actual authority. Recently, though, nothing. So maybe there is not a vast number of lurkers out there.

    Now, tim, let my try to answer your questions. I’m operating without my files, unfortunately. $40 million principal plus $55 million in interest equals $95 million to be paid to the bondholders. I think Bob Johnson misspoke at the meeting when he said the amount to be paid was $80 million, since interest rates are higher now than in 2003.

    Yes, whatever the various uses are within the project would change the assessment somewhat, since the assessment depends on the rents that the owner is receiving. Some uses generate higher rents than others.

    If you check out the team minutes of June 2, you will see the assessor’s staff saying that the new assessment will be lower because of a revised treatment of parking structure revenues. I haven’t seen any of the materials distributed at any of the team meetings. Presumably they would give us more information.


       —Dave Cahill    Jul. 1 '06 - 07:35PM    #
  89. You never know who may be on City Council, though, Dave: see today’s AA News, Local Green Party pushes divestment from Israel: Henry Herskovitz considers City Council run on the issue ,

    “A group of pro-Palestinian activists has taken control of the local Green Party and hopes to make divestment from Israel an election issue in Ann Arbor, current and former party members said.

    Henry Herskovitz, a member of Jewish Witnesses For Peace And Friends, said he is considering running for the City Council in the 5th Ward and his platform will be divestment from Israel. His group has been protesting outside Beth Israel Congregation synagogue before Saturday services every week for the past several years.

    “If I have to run for City Council office to get that message out, I will do that,’’ Herskovitz said. ...”

    He could always run for Mayor, I suppose, but maybe he wants to start small.
       —David Boyle    Jul. 1 '06 - 08:02PM    #
  90. I’ve heard some offline comments about the bond “subsidy” that merit correction. So, here’s my attempt at an explanation of why this “subsidy” is okay.

    There are two definitions for “brownfield”; one is “contaminated with nasty crud that needs to be cleaned up”, the other is “developed in a functionally obsolete fashion”. The one leads to sickness and death of people and/or other critters; the other just leads to a built space laying fallow and unused. Both of those things are bad, and both apply to the Broadway Village site.

    Providing public funding for the redevelopment of brownfield sites is pretty standard practice, in recognition of the public good involved in cleaning up either kind of brownfield. Brownfield redevelopment includes substantial benefits for the public that are not captured by the developer/user – redevelopment has positive externalities.

    I’ve heard it said, “if this development needs a subsidy to succeed, maybe it isn’t economically the right development.” On the contrary, when a positive externality exists, economically, a subsidy is the right thing, as a mechanism for paying for the public benefit. If no subsidy is provided in payment for the public benefit, then an economically inefficient outcome will result, such as the site continuing to lay un- or underused, a sore on the face of Ann Arbor.

    The now-standard mechanism for providing this repayment to the developer, in exchange for the public good provided by redeveloping a brownfield site, is a brownfield TIF, or tax-increment financing. Public money is provided upfront and paid back through the new property taxes (the incremental taxes) generated in the first several years of the development. It’s a very clever mechanism for buying something of value with public money without actually subtracting any public money from anything.

    So the bonds in question for this project are not something unusual or special, and do not by their existence imply that the project is economically unwise. The bonds are just part of a standard practice of cleaning up some mess in the existing built form, using a private developer as the agent of the clean-up.

    “Bonds = subsidy = wrong” is not a valid criticism of this project – in fact, “bonds = subsidy = right”, economically speaking, because of the positive externalities involved.

    This doesn’t necessarily mean that the bonds should be issued blankly or without any scrutiny or oversight, of course – we, the Public, need to make sure that we’re getting what we’re paying for. And, from the documents that David has provided (thank you, David) and the interview with John Roberts on the ‘totter (thank you, HD), I’m at this point pretty confident that the bonds are well under the microscope.

    So what’s the purpose of the petition? A group of citizens that doesn’t understand the economics involved, as their press release indicates, thinks that they should provide oversight instead of the people we’ve elected and hired to rigorously crunch the numbers. I’m only in favor of direct democracy when the demos involved is willing to put in the time to understand the issues. And, so far, it appears that most are either acting from faulty assumptions or no assumptions.

    Which is why I generally dislike petition drives. (See also: Keep Ypsi Rollin’s charter amendment petition drive.)


       —Murph.    Jul. 1 '06 - 09:19PM    #
  91. In Post 88 Mr. Cahill makes it clear he feels the duly elected leaders of the city will knowingly approve a bad financial deal. Despite the fact that both Mr. Roberts and the July issue of the Observer are clear that the city is looking at this very carefully. Please David answer two questions:
    Why would they do this? (Some secret payoff, an even deeper conspiracy or they are just plain stupid?) Why would we believe this is not all about the project being down the street from your house?


       —Dustin    Jul. 1 '06 - 11:33PM    #
  92. I understand Murph’s theory. But I disagree with it with regard to this particular project. This thing is the largest brownfield project ever proposed in Washtenaw County, the first in AA, and one of the largest in the state. The developer, with the encouragement of Council, has managed to parlay a small amount of brownfield cleanup funds ($4 million) into an immense $185 million project.

    Public subsidies distort the market. The site in question has repetedly failed economically. I expect the reason is the odd traffic pattern in the area. A mistake here, involving public funds, will be a really big mistake.

    Just the city subsidy alone ($40 million) is ten times the clean-up cost.

    Council has repeatedly given the developer approvals that sound preliminary. But remember that, relying on those supposedly preliminary approvals, the developer has already spent over $1 million on construction of a new mini-mall across from Kroger’s and relocation of tenants. Council has built momentum for the project. Council has raised legitimate expectations in the developer’s mind that the project will receive final approval. Such expectations can be used to convince Council that it really ought to give final approval, even if those meddlesome staff people disagree.

    Ask yourself this question: If Council really intends to take the staff’s advice on the project’s soundness, why did Council pass a resolution stating that it intended to issue the bonds before the staff had a chance to make its formal recommendations, and despite the comment of Tom Crawford at its June 5 meeting that the taxes were insufficient?

    Council’s track record on this project is not good.

    While John Roberts means what he says (and thanks to him if he is reading this), he is not calling the tune on this project.

    Bob Johnson, the senior First Ward Council member, said last week that this project is an inappropriate use of the Tax Increment Financing (TIF) mechanism.

    Nonetheless, Roberts and Johnson can’t stop this project any more than Groome and Johnson could derail it in 2003.

    Why not ask Mayor Hieftje, and/or Council members Carlberg, Greden and Easthope why they voted to publish that notice of intent before the staff investigation was complete?


       —Dave Cahill    Jul. 2 '06 - 04:26AM    #
  93. TIF is a mechanism, not a subsidy.


       —Dale    Jul. 2 '06 - 02:16PM    #
  94. Public subsidies distort the market.

    This statement is exactly what I’m calling wrong on the theory, which has to be cleared up before talking about the magnitude.

    Public subsidies can create market distortions, but can also correct market distortions. Externalities, whether positive or negative, are market distortions. I would disagree with Dale and say, sure, TIF is a form of subsidy.

    David, as long as you’re throwing around the blanket statement that a subsidy is a bad thing, I’m going to disagree with you. When you can stop taking a knee-jerk Libertarian’s attitude towards public financing mechanisms, then we can settle down to a more nuanced discussion of this particular project.

    As I said, I don’t know enough numbers to say whether this is the right level of financing for this particular project. I don’t expect that I’m the right person to make the final decision, either – that’s why we pay Council the big bucks (ha.) and hire city staff. It’s open for discussion whether this is a good project for the site – and, like todd, I think that’s the discussion you’re really trying to have.

    Like David, I’d be happy to see people like John Roberts, Bob Johnson, and Tom Crawford chip in their two cents – better to hear some of the facts from the people who know them all rather than secondhand through David or Tom Gantert.


       —Murph.    Jul. 2 '06 - 02:35PM    #
  95. Mr. Cahill, the July Observer, a publication you have held up in the past, speaks to this issue. The City and the City Council are taking great care in exploring all facets of the financing for Lowertown. Please tell us why you think council would approve a financing agreement and bond sale if the numbers do not work out. Why would they ignore the advice of their CEO and Attorney? What would compel them to do this?


       —Dustin    Jul. 2 '06 - 03:24PM    #
  96. “It’s open for discussion whether this is a good project for the site – and, like todd, I think that’s the discussion you’re really trying to have.”

    Yep, that’s my position in summary.

    In fact, if Dave would take two seconds and actually read my posts, he’ll notice that I didn’t say that I was supportive of this project.

    I really don’t know much about Broadway Village…..which is why I thought that JulieW’s question of “is this a good project for this space?” was a good one.

    So to answer Dustin’s question for Dave, since he’s neatly ignored it, Dave doesn’t honestly think that the city is going to willfully issue bonds that don’t pay for themselves, even though he probably won’t admit that.

    I think that I can speak for many here at Arbor Update, Dave, and say that you and CARD would be better off, and a lot more honest if you’d just say “Look, we think this project sucks. Since City Council already approved this project, pending the issuance of bonds, our only chance to block this project is for you to sign this petition so that we can vote ‘no’ on the issuance of the bonds.”

    See how much better that is Dave? No subterfuge. No made up or incomplete bond numbers. No implications that Council is either corrupt or incompetent.

    And you know what, Dave? If you make your case as to why Broadway Village as proposed sucks, some of us here (including me) might actually sign your damn petition.

    ......That’s why this tread was so funny, Dave.


       —todd    Jul. 2 '06 - 05:14PM    #
  97. I think this project sucks because of the huge public subsidy. Oh, I suppose it’s too big for my personal taste, but the subsidy thing is what has always done it for me. I live far enough up the Broadway hill that it won’t affect me. Broadway has traffic humps, and the street is already parked up in the daytime anyway because of overflow from the Kellogg Eye Center.

    It would have been acceptable to me if the DDA had taken over this project. In fact, I remember several years ago suggesting that the DDA be extended to reach this site. A downtown development authority has to be one contiguous area without “islands”, but that could have been achieved legally by extending the DDA to include just the actual streets of Division and Broadway (not the houses), connecting the main DDA to the Broadway Village part of the DDA.

    But the DDA wanted nothing to do with the Broadway Village project. (Murph, mention this to Susan Pollay sometime.)

    And I personally expect that if the petition drive does not succeed in blocking the bonds, Council will go ahead, override its staff, approve the project. If they were not planning on approving the project, they wouldn’t have published that “notice of intent.” They had no reason to publish that notice until the staff work had been done, after all.

    So a vote of the public is the only chance we have to block the big subsidy.


       —Dave Cahill    Jul. 2 '06 - 05:38PM    #
  98. I didn’t realize how long you had been a DDA advocate, Dave.


       —Dale    Jul. 2 '06 - 06:11PM    #
  99. Mr. Cahill: After two years the City Council has not taken any final action on the financing of this proposal. Why would they not publish the notice of intent to start the time clock while the research is ongoing? They still hold all the cards. The publication changes nothing. Despite considerable evidence they are approaching this very carefully, doing all the proper research and background checks, you persist in saying they will take risky, irresponsible action and we need CARD to protect the city from financial disaster. If you step back and consider that except for Ann Arbor and a few others, cities in this state are generally in sorry financial shape, it appears the current council has shown a firm grasp of financial matters. Please tell us WHY council would would take such risky action and approve the sale of unsupported bonds.


       —Dustin    Jul. 2 '06 - 06:27PM    #
  100. ummmmm, ..... aside from the considerations above, in both directions, there is at least one different question that puzzles me.

    a few years back i ran into a legal prohibition against taxpayer dollars being used for any development that is inside the boundries of a flood plain.

    there are some specific quantifications and attached statistics to that prohibition that i don’t have a handle on – which taxpayers and how often the place floods were two of the statistical quanta that i do remember.

    new orleans aside, this prohibition is intertwined in both michigan and federal statutes, somehow.

    my question, then, is: “is this project a legal use of taxpayer dollars given its location?”

    cheerrioz, toasty


       —toasty    Jul. 2 '06 - 10:45PM    #
  101. Mr. Cahill, your argument against Murph’s explanation (it is not a theory, but it could be called an opinion) begs a number of questions.

    You say, “This thing is the largest brownfield project ever proposed in Washtenaw County, the first in AA, and one of the largest in the state.” And your point is…? Its size is only relevant if you are comparing it to other brownfield sites and their relative costs (but brownfield costs are difficult or impossible to compare due to factors described in the 2nd paragraph of post #90). Are you trying to say that this project’s costs are out of line for its size? No one has made reference to this. Why does the size matter; the site is what it is?

    You also say, “The developer, with the encouragement of Council, has managed to parlay a small amount of brownfield cleanup funds ($4 million) into an immense $185 million project.” I keep reading this and cannot understand what seems to be your distain for this outcome. Should the developer have asked for more cleanup money, would that have been a better result for you? If the developer only needed $4 million to prepare for a $185 million project isn’t that good?

    You further write, “Just the city subsidy alone ($40 million) is ten times the clean-up cost.” Are these two things related? Is the $40 million that the developer is looking for based on a calculation to remediate problems that exist on this site? If this is the distortions that Murph is referencing how were they figured? Are you arguing that the calculations are wrong? I for one don’t know if it is too high, or possibly too low.

    Still more, you say, “I think this project sucks because of the huge public subsidy.” You may not want to support the $40m bond and that is your choice; you might not want to support any bond for this project. But we should be clear because you haven’t even begun to justify the use of the term ‘huge’. For all I know, this bond may be miniscule compared to other projects with similar issues. Nevertheless you have shed no light.

    Lastly you declare, “Oh, I suppose it’s too big for my personal taste…” So what are you doing to make this project the best it can be? Clearly you, and your group, are actively working to tear apart the current process but doing so without a concept to replace it is irresponsible and doesn’t fit into CARD’s agenda.


       —abc    Jul. 3 '06 - 01:23PM    #
  102. The clean-up costs are being used as a rationalization for the project instead of as a reason for it. This large project is not being built in order to clean up the pollution. Instead, the pollution is being used to attract the subsidies that will result in a project on steroids.

    All over the state, developers are trying to leverage small areas of pollution into big subsidies. This developer – and our City Council – have gone the furthest in this dubious process.

    As far as I know, the $40 million bond issue is the largest in the state. I call it huge because it is almost half of our annual City budget. It is the largest project the City has ever been actively involved in. For comparison, Jim Koli, who runs the Northside Grill, says that the cost of the Broadway Bridges project (the largest project until then) was only $21 million.

    Please rise above the concept that any group or members of the public has any influence on what the developer has decided to build. Although there is a big public subsidy, there is no public control over what the project looks like or who the tenants are.

    The developer wants to feed at the public trough, but the public has been shut out of the design process.

    If Broadway Village fails (because the public turns down the bond issue or otherwise) the developer will be perfectly free to build a wide variety of other kinds of projects. The developer had to submit a “Plan B” to show what could be built without all the special favors the developer wanted from the City. It showed a standard commercial structure. The developer said it might be a Walgreen’s drug store.


       —Dave Cahill    Jul. 3 '06 - 03:54PM    #
  103. Greatly appreciate the candor in post #97, Dave.

    It makes for a much better read.

    Enjoy the holiday weekend, everybody…

    Oh, and Happy Birthday, America!


       —todd    Jul. 3 '06 - 04:56PM    #
  104. In post #97, Cahill asserts that the DDA wanted nothing to do with the Broadway Village project. When he talks about extending the DDA, it is not so simple as that. If the DDA boundaries had been changed, the whole plan would have had to go back to the governing entities which had originally acquiesed to their taxes being captured. It was not worth the effort. The Broadway Village project is not within the DDA boundaries, and when we were looking at changes, that area was never even considered- we were looking at the other end of town – at S. Forest. These are the facts. I was there.


       —Leah    Jul. 3 '06 - 06:25PM    #
  105. Mr. Cahill: Please read post #99. Given all the information that shows council is looking at this issue very carefully and given the fact that this council seems to have a good handle on financial matters, please answer three questions: Why would council override the advice of their CEO and Attorney? Why do you believe they will approve the sale of unsupported bonds and put the city in a risky financial position? What would induce them to do this?

    Thank you.


       —Dustin    Jul. 3 '06 - 06:38PM    #
  106. “They had no reason to publish that notice until the staff work had been done, after all.

    So a vote of the public is the only chance we have to block the big subsidy.”

    Dave, John Roberts offered a very plausible explanation for the timing of the notice. As for opportunities to stop the bond issue (your term “block” is an indication of your apparent preference for zero-sum games), they would also include communicating directly with council.

    Your concluding sentence in #37 likewise overlooks that option. Both the Business Review article and toasty’s post indicate that there may be environmental regulations that could affect the outcome as well. Your narrowmindedness, willful ignorance, preference for conflict, or whatever it is that leads you to communicate this way puts your judgment into question. Citizen watchdogs of government perform best when they focus more on the implications of government action than on the motivations for the action (in large part because alleged motivations can be easily denied.) If you want us to follow your lead, give us more reasons to trust your judgment and fewer reasons to question your tactics.

    I also think that abc has a point, that you haven’t offered an alternative vision or process to replace the unacceptable ones you oppose. This in spite of several people here pointing out the current deplorable condition of the site. In your last post you complained about various aspects of the project but didn’t clearly state what you believe the role of citizens should be and under what circumstances. Do you or anyone in CARD have suggestions for how this type/size of TIF request would be best evaluated? What’s the best possible outcome for the site, in your opinion? Or is your only goal to “block” the project? Any plans by CARD members to offer public comment to council?

    Your concern about the amount of the TIF compared to the cleanup costs may be a valid one. (The amount of the total project would be a separate issue I would think. You might want to be more clear about that as well.) When the Environmental Commission made its recommendations to the city regarding the brownfield authority, that question came up. I don’t think it was ever adequately examined, though. What are your thoughts on limiting public investment relative to public benefit in this type of situation? (Please keep in mind your own distinction between rationalization and reasoning.)


       —Steve Bean    Jul. 3 '06 - 07:29PM    #
  107. I was there too, Leah. I remember a phone conversation in which you vehemently objected to the proposed Broadway Village parking structure. You thought it could never be properly maintained. You went on at some length about its problems.

    Why do I think Council would override the advice of its CFO? Because even though its CFO said three years ago that the City would only bond to an amount supported by the staff’s $65,000,000 appraisal, Council has persisted in going ahead with the project by (1) approving a partial development agreement in 2004 and (2) publishing a notice of intent when the staff work should have been finished first.

    Also, because as the secret team minutes show, City Admistrator Roger Fraser was pushing for the next step in the process – an “inducement resolution” – for sometime in May.

    Roger has always wanted this project. So have the governing forces on Council – Hieftje, Carlberg, Greden, and Easthope. Council has never listened to those raising financial or other objections. Since the past is the best predictor of the future, I expect they won’t listen in the future, either. 8-)

    Happy Fourth of July, everyone! Look for our petition circulators wherever there are large numbers of people.


       —Dave Cahill    Jul. 3 '06 - 10:43PM    #
  108. Dave Cahill wrote: “Look for our petition circulators wherever there are large numbers of people.”

    You mean like, I dunno, a parade?

    And as far as the ‘inducement resolution’ goes, I had no idea what that meant, but guessed it meant a resolution to publish the intent to issue the bonds. However, Dave Cahill’s last comment makes me think that guess is probably wrong.

    Perhaps someone could comment on what exactly an ‘inducement resolution’ is?

    Parade start is 10:00am, by the way. Perhaps next year, AU could come up with an entry?


       —HD    Jul. 3 '06 - 11:00PM    #
  109. Thank you for the answers Mr. Cahill. Three more questions if you please:
    Isn’t it true that until the financing agreement is approved and bonds are sold, Council holds all the cards and they could pull the plug at any time?
    Do you really think they would, with negative reports from the CFO and Attorney in hand, approve the sale of unsupported bonds?

    What would their motivation be to cause them to want this project so badly that as you imply, they would seriously endanger the financial status of the city?


       —Dustin    Jul. 4 '06 - 03:35AM    #
  110. Of Dustin’s recent batch of questions to David Cahill, it seems that the most productive one is what the motive for council would be to push the project through if it will be a financial burden. It’s pretty clear that council can still pull the plug. Cahill hasn’t contested that. And his concern that council would go against the advice of staff and the CFO is what started this thread. While I agree with abc that watchdogs groups are better off focusing on the impact of decisions, the lack of motive here is an obvious hole in the argument.


       —Scott TenBrink    Jul. 4 '06 - 10:24AM    #
  111. The maintenance of a parking structure has NOTHING to do with the DDA boundaries. I am very sensitive indeed to the maintenance of such buildings because I was on the DDA when we took over the parking system management and went through the process of repairing and replacing parking structures. My anxiety about the parking structure maintenance had nothing to do with the concept as a whole, and if you recall, I voted “yes” at the Board of Commissioners meeting when the request for a Brownfield Authority grant was on the agenda.

    Once again, get your facts straight. The issue of the parking structure maintenance is totally irrelevant to the change in DDA boundaries. It appears that you will grasp at anything to try and discredit people in order to further your own point of view. Stick to the issue being discussed.


       —Leah    Jul. 4 '06 - 02:47PM    #
  112. As to the motives of various Council members, I think you should ask them. I’m not saying that Council members (and others) who want this project are evil. I’m only saying that this thing should stand on its own merits and not require a public subsidy.

    With regard to the DDA, Susan Pollay (the executive director of the DDA) was at many of the meetings of the Brownfield Review Committee in 2003. The Committee was dealing with Broadway Village exclusively. Susan is one of the smartest folks on the City staff. She wasn’t shadowing Broadway Village for her health.

    I know the extension of DDA boundaries was considered. I think John Hieftje also came up with the idea of extending the boundaries to include Broadway Village. I remember being told the idea wouldn’t fly because the neighborhoods in between the present DDA boundaries and Broadway Village didn’t want it.


       —Dave Cahill    Jul. 4 '06 - 04:19PM    #
  113. David – you are just plain wrong an all counts. If John wanted to extend the DDA to those areas you mention, he never brought it up at any DDA meeting.

    And as for Susan attending meetings, she attends many, many meetings. She, and I, are always interested in what goes on in the community. I am in places that you would never imagine, because I am curious and attentive.

    So, don’t draw false conclusions.


       —Leah    Jul. 4 '06 - 07:12PM    #
  114. There has been an incident.

    Peter Allen was the person who thought up Broadway Village. He and his company have a 15% interest in the project according to recently filed documents.

    Last Saturday at the Farmers Market he came up to one our circulators. She was wearing a cloth sandwich board saying that the city was going to give the developer money. I was not there, so this is her report: Allen was rude and obnoxious. He was livid. He said she was lying and deceitful because the money was not a gift, but a loan. He said he insisted that she change the word “gift” to “loan”. So in order to get rid of him, she did.

    He said City Council had already voted on this project.

    This encounter reduced our circulator to tears.

    She does not want to make a big deal of this incident – unless something like it happens again – because she thinks it would distract from the petition drive.


       —Dave Cahill    Jul. 4 '06 - 08:47PM    #
  115. I can’t wait to hear what the Lunch Bunch has to say about this!


       —Dale    Jul. 4 '06 - 09:25PM    #
  116. What’s a “cloth sandwich board”?


       —ann arbor is overrated    Jul. 4 '06 - 09:36PM    #
  117. maybe the super-secret city team can put on their alter-ego costumes and put a stop to these treacherous “incidents.”


       —tim    Jul. 4 '06 - 10:22PM    #
  118. “She does not want to make a big deal of this incident – unless something like it happens again – because she thinks it would distract from the petition drive.”

    Got that everybody? Keep it under your hat. Until next time.


       —Slanderama    Jul. 4 '06 - 10:40PM    #
  119. Please let something distract from this petition drive!


       —Libelicious    Jul. 4 '06 - 10:41PM    #
  120. “She does not want to make a big deal of this incident”.

    ....so you post one side of this story on Arbor Update?

    You are one smooth operator.


       —todd    Jul. 5 '06 - 12:41AM    #
  121. Here is my attempt at estimating bond payments and revenues from TIF and parking. I’m not claiming that the numbers and methods are correct and would encourage others to contribute corrections. In fact I’m sure they are not that close. However, I feel that in absence of a qualified response to CARD’s unsupported assertion that the TIF would not pay off the bonds, we should have some numbers to consider.

    Bond payment
    Based on a $40 million bond over 30 years and 4.61% rate, a loan calculator says (roughly):
    Monthly payments: $205,300
    Yearly payments: $2,463,600
    Total interest: $33,900,000
    Total amount paid: $73,906,900

    TIF revenues
    Based on the following:
    Current tax collected from property (2005): $150,000
    Estimated future value: $65,000,000
    Taxable value adjustment: .5
    Property tax rate (millage): .059
    Time Period: 30 years
    I estimate the TIF revenues to be
    (37,000,000 * .5) * .059 = 1,917,500 per year,
    subtract out the $150,000 in existing taxes per year,
    resulting in total revenues of $53,025,000.

    Of course that assumes that the value of the land is $65 million immediately. Usually TIF assumes a ramping up period. A 10 year ramp-up results in a total reduction of about $8 million and a 20 year ramp-up results in a $19 reduction in total revenues.
    Based these numbers, WHICH ARE NOT VERIFIED OR NECESSARILY CORRECT, it looks like revenues are short by at least $500,000 per year.

    Don’t forget that this project will use parking revenue to pay off the TIF. Anticipated revenues and the point in the budget where revenues are determined are not known, so it is tough to say how much this will contribute, but it will at least make a dent.

    Obviously many of these numbers can be shifted for different results, and many probably should be. I’m especially uncertain of how to determine the assessed and taxable value of the property. .5 just seemed close. The current tax revenues are also a really rough guess. I went with the lowest suggested future property value I could find. The bond payments are based on a simple loan calculator that you can easily find via google. I used the tax and assessment data available here:
    http://www.ci.ann-arbor.mi.us/FinancialAdminServices/data.html


       —Scott TenBrink    Jul. 5 '06 - 09:52AM    #
  122. David, did you explain to your employee that this issue is divisive before you sent her out into the streets? Did she read her sandwich board first? Did she know what the words meant? I’ll bet anyone reading this that David’s worker couldn’t speak to this issue and had no sense of the distinction that Peter was making.

    As is evident from this thread, CARD’s whole presentation is full of half truths and innuendo. So they suckered a volunteer to hand out leaflets at the farmers market and they ran into a buzzsaw, too bad; could have predicted that. What did you think would happen when you manipulated uninformed volunteers to strap incendiary language on to themselves and sent them into a crowd? You are surprised that some one blew up at them. I am surprised that more people didn’t.

    People’s lack of response speaks directly to Murph’s closing comments in post #90.


       —abc    Jul. 5 '06 - 10:14AM    #
  123. The “cloth sandwich board” operator, I’m told, was Laura Stowe, the head of CARD. If you’re going to post one party’s name, you should post the other’s.

    And Dave, if you reach behind your harddrive tower, you’ll find the large knob called the “exaggerator”. You should turn the knob counter-clockwise. Peter Allen was not “livid”.

    Not surprisingly, Dave C’s exaggerator knob goes to “eleven”.

    Oh and Dave: these bonds aren’t any more of a ‘gift’ from the city than your home mortgage is a ‘gift’ from your bank. Please alter your signage to reflect this fact.

    Is it so hard to get signatures that you have to distort the facts, Dave? Why not just try telling the truth?


       —todd    Jul. 5 '06 - 01:22PM    #
  124. There has been an incident.

    I was hanging out at Dolph park, not exactly chilling, but not cruising either. You know, just waiting to see whose kids might wander by. I had a couple of pornos to sell, and maybe half an ounce of weed, and I was wearing this cloth sandwich board advertising the fact. (I’ll blow dudes in the bushes too, but you don’t have to advertise that at Dolph) So anyway, this weird, fat dude, with a nose kind of like a pig, comes up to me and starts ripping off my cloth sandwich board and grabbing me around the waist. I thought at first he was going for the dope, but pretty soon I realized he was trying to get his hands on my big fat cock. I was like, “Cahill, you cheap piece of shit, just pay me ten bucks and we can handle this ass-fuckage like gentlemen!” But no, that money grubbing bastard wanted to get the PSD for free.

    So I fought him off, which didn’t take much effort with him getting winded just unzipping his fly. But he jizzed all over my sandwich board, and got bacon grease on my pants, and when I finally got up and dusted myself off, and he had wedged himself back in his Civic and driven away, I realized that he had in fact stolen my weed, which reduced me to tears.

    I don’t want to make a big deal of this incicident, which is why I’m just sharing it with you folks, my closest friends.


       —Parking Structure Dude!    Jul. 5 '06 - 01:51PM    #
  125. This loan versus gift thnig is a bit confusing to me. Correct me if I’m wrong, but I understand that the city gives the money to the developer, and then receives taxes generated by the development. I suppose the only question in terms of getting the money back (including interest) is when it will happen. Though if the project isn’t successful, I guess it wouldn’t generate much in taxes. However, this still leaves me with these questions:

    If the taxes are lower than the city’s bond payments, who pays the difference during those years?

    Can Ann Arbor “forclose” on the project like the usual lender if the payments (taxes in this case?) are inadequate?

    From the developers’ point of view, do they get the $40,000,000 and do not have to pay a penny back (apart from taxes, which is an obligation of all property owners)? If this is the case, then in what sense is this a loan rather than a gift?

    Does Ann Arbor government end up owning any part of this development after the loan/gift/whatever is repaid?


       —AK    Jul. 5 '06 - 02:00PM    #
  126. Wow, if Todd’s correct, I am wrong. My apologies. That’s what happens when one is told half a story.

    David, Ms. Stowe is not simply “one our circulators“; she runs the show. Or do you run it? I would not be surprised as this started with you implying just knowledge of CARD; now it is ‘yours’. Clearly you have difficulties being truthful.

    So it seems that she isn’t an uninformed volunteer, as I was led to believe. And given her level of involvement with CARD she should have been sufficiently prepared to speak to Peter and explain that the choice of words she was so proudly wearing accurately reflected her view and why, without crying. I guess she didn’t realize that she is, in effect, calling Peter (among others) a thief and that that might piss him off? Next time she’ll think twice before letting you use her address for your clever organization.


       —abc    Jul. 5 '06 - 02:17PM    #
  127. The confusion here as to loan vs. gift is clear evidence of the obfuscation being promoted to keep voters from expressing more interest. The fact that MAYBE the city MIGHT make back the money in tax revenues does not make it a loan. When I first heard about the project I thought it was a loan. Then, I learned that it is a subsidy.

    I am not anti-development and I am not a NIMBY. I grew up in New York City and I am not afraid of tall buildings. I did not have a solid opinion on Lowertown until after attending the presentation from Strathmore at the Northside Grill that was hosted by my opponent for City Council, John Roberts. I was there when the developer attempted to mislead people into thinking the 45 day clock had not yet started for a deadline to collect signatures to oppose this. Only at the end, after several people pressed him for an explicit answer did the developer say he “misspoke” earlier when he implied that the clock had not yet started ticking. This was a big red flag for me. I have learned the hard way in business that letting these sorts of red flags go by can easily lead you into a relationship where you end up getting screwed.

    Flame wars are fun for some people and as a native New Yorker I appreciate cynicism and sarcasm. But, the fact remains that risking $80 million which taxpayers will have to cough up if this project fails is no joke.

    I do think it is important that sites like this poke fun at people, but I hope this group is too smart to participate in blurring the financial realities of an important decision.

    How many times in the next quarter century will the city of Ann Arbor be able to take this kind of a risk and if this is the only time or one of a small number of times is this the project we want for our gamble? I’ll check Arbor Update to see if anyone there has some answers – I know there are are smart people participating in this debate.


       —Ron Suarez    Jul. 5 '06 - 07:08PM    #
  128. CORRECTION – last sentence should read – I will check back with Arbor Update.


       —Ron Suarez    Jul. 5 '06 - 07:12PM    #
  129. I am not anti-development and I am not a NIMBY.

    I hope this isn’t too far off-topic, but, as an active member of the Old Fourth Ward Association, are there any positions the group has taken that you would disagree with?


       —ann arbor is overrated    Jul. 5 '06 - 07:18PM    #
  130. I haven’t had a chance to run through Scott’s numbers to see if I can come to the same conclusions. But to answer one question:

    “Based these numbers, WHICH ARE NOT VERIFIED OR NECESSARILY CORRECT, it looks like revenues are short by at least $500,000 per year.”

    Perhaps that explains this:

    “The bonds, which must be approved by the City Council, will be paid back with taxes generated by new development on the Broadway site. Strathmore has also agreed to pay the city $500,000 annually for 30 years following construction.”

    [link]


       —John Q.    Jul. 5 '06 - 08:07PM    #
  131. OK, first of all, it is St r owe, not Stowe. If you are going to snark about her, at least get her name right. Laura Strowe is an artist who does the lovely pastels of houses, businesses, and landscapes in town. Her pictures are the ones featured most often on the covers of the Observer.

    As for Peter Allen, I don’t know him that well, but in my dealings with him he has always been extremely gracious. However, he is very committed to Ann Arbor and to making it the best that it can be from his point of view. I can see that he would be furious if someone was making unfounded claims, especially about his motives or the early days of this project. If you are wearing a politically-motivated sign and asking people to sign petitions about extremely complicated issues that you are summing up in a single sentence, you shouldn’t be “reduced to tears” if someone disagrees with you.

    This is a very complicated issue. Statements like “I hope this group is too smart to participate in blurring the financial realities of an important decision” really piss me off because the whole point of this thread has been “show us the data” so we can make informed decisions. So Ron, show us the data.


       —Juliew    Jul. 5 '06 - 08:45PM    #
  132. The $500,000 payment per year is supposed to be in addition to the taxes according to the developers’ comments at NS Grill.

    Question:

    This is a compicated deal so set me straight on this issue if you can.

    It seems the developer may have made conflicting promises to different entities.

    To the City, the developer promised 37 affordable housing units based on the dollars in brownfield funds and tax abatements the City has given to the project. The affordable units are to be built in phase 2. There is also a bank contingency—that the City release the developer from the affordable housing promise. Seemingly the bank approved financing subsequent to the deal being struck with the city.

    Does this mean a)the developer doesn’t really have financing for phase 2 with the current agreement with the city (and will be forced to seek new financing if they ever get to phase 2) ?

    or

    b)the developer will go back to the City and ask to revise the PUD regs to eliminate the affordable housing or ask for a subsidy to cover the “affordability gap”—i.e., the difference between an affordable unit [about $100,000] and a market unit [$255,000 and up]. 37 units @ $200,000 per unit as a subsidy adds up to ~$7 million, so its a lot of scratch….

    or

    C) something else

    It would be great if anyone can clarify this issue for me.


       —Tim Colenback    Jul. 5 '06 - 09:19PM    #
  133. todd, abc, AK, Scott, John Q, Ron, Tim –
    Thanks for pulling this back to some semblance of civility. To the previous batch of posters, take it back to the off-leash troll park, wouldja?

    There’s a lot of information flying around here, and I can’t claim to tell what’s most current. For example, Tim, do you have a source on your comment on the possibly conflicting commitments? Either linkable or hard-copy? If the conflict you mention is current, that would sound like something that would derail the project, indeed.

    Be nice if we either had some public officials ‘round here to answer some of these questions from a position of knowledge or else a local newspaper willing to dig for the questions. Only so much investigation that Concerned Citizens can do…


       —Murph    Jul. 5 '06 - 09:31PM    #
  134. To the previous batch of posters, take it back to the off-leash troll park, wouldja?

    Uhhhh. I think you’ll find the linked thread to be quite civil. Satire != trolling.


       —ann arbor is overrated    Jul. 5 '06 - 11:36PM    #
  135. Trollery is supposed to be targeted and eliminated, not just NIMBY’d off to someone else’s site. And a site that is not a troll site, to boot. (Hey aaio)


       —David Boyle    Jul. 6 '06 - 12:36AM    #
  136. (So, AAiO, would you consider my comment to have been trolling, in which case you bit, or satire of your site, where discussion of an off-leash troll park would be par for the course? p.s. I have to thank KBlow, whomever that is, for putting the lie to your claim of civility. So there. :) )


       —Murph.    Jul. 6 '06 - 02:33AM    #
  137. Murph: So, when i visit AAIO, am I at the Troll Park or looking for a discussion about the recreational habits of free-range trolls? Which is it? Posts 133 and 136 seem to contradict each other in this regard and that is just unacceptable. I don’t care if the serious information here is contradictory or down right fallacious, but the sarcasm better be spot on.


       —tim    Jul. 6 '06 - 03:38AM    #
  138. In response to AK post #125:

    Once the city issues the bonds, they have to pay them back. If that money doesn’t come from TIF revenues, it will come from the general tax base in some form (either new taxes or a redistribution of existing tax revenues). The city does not have a lean on the property, nor is the developer obligated to pay off the bonds that have been issued. There are contractual obligations that the contractor must fulfill.

    But it is important to note that NO ONE HAS GIVEN ANY SUBSTANTIAL EVIDENCE OF SHORTFALL OF REVENUES TO PAY OFF THE BOND. My previous post, sadly, is the best effort so far to put numbers to this issue. From official communications, it seems clear that council, the CFO, and other staff are making great efforts to minimize the financial risk to the city and fully retain the option of pulling the $40 million if the numbers don’t work out. CARD has provided no evidence to the contrary, and has instead focused on ominous, vague, and unsubstantiated claims of pending disaster. I fully agree with juliew that it is much more disappointing that no one with more in-depth understanding and better numbers has provided a response to CARD’s fear mongering. I would also ecco Murph’s frustration with the generally slow media response to this issue.

    (strange: the correct spelling of “echo” above generates an error when posting. Another AU syntax anomoly.)


       —Scott TenBrink    Jul. 6 '06 - 03:46AM    #
  139. Does anyone have the details on what activities will be done with the $40 million in bonds and the timing of said activities? One would assume that the site cleanup will happen at the beginning of the process. This is a good thing and even if the project didn’t move forward, having the site cleaned up would help facilitate future development. What of the rest of the $40 million?


       —John Q.    Jul. 6 '06 - 04:12AM    #
  140. Gift, Subsidy, or Loan?

    I don’t think any of these terms are a useful description of TIF for the following reasons (some of which have been pointed out by others):
    1.The money being allocated would not exist without the project. The city doesn’t have the money, so it is difficult to argue that it is giving anything.
    2.At the same time, once the project is complete, the owner would pay the increased tax rate whether there was a TIF in place or not. This makes it hard to argue that they are repaying a loan.
    3.The term “subsidy” has been applied so broadly (and AU is hardly an exception) that it has lost all practical meaning beyond “paying for something I don’t want”. County patrols, public transit, highways, the education system, suburban living, private automobiles, parks, affordable housing, health care, parking and the internet have all been used as examples of subsidies. “Subsidy” has taken on the broad negative connotation of “it sucks” and so has limited descriptive power. Contrary to Ron’s distinction between loan and subsidy, todd points out that SBA loans are a subsidy, so the two terms are not mutually exclusive.
    TIF is an effective financial mechanism that city government can use to great advantage. I think that the DDA is a good example of that. Whether it is a gift, loan, subsidy or all three, it is a program supported by a wide variety of institutions as an effective way to benefit both the city and the developer. The mechanism is being attacked when it is the development that CARD doesn’t like. I don’t particularly like the plans either, but that doesn’t mean I will support an attack on TIF programs.

    A couple points to keep in mind:
    1.The TIF money is not for use at the discretion of the developer. The 1996 Brownfield Redevelopment Financing Act defines uses for the money. In Broadway Village, the money is being used for utilities, parking structure, and brownfield clean-up. I believe all of these meet the requirements of the funding. The money is not going towards solid gold houses and rocket cars.
    2.This thread is in large part an argument for the necessity of a background check on claims put forth by David Cahill. With that caveat, he does report that the alternate plan is to build a Walmart. Maybe I’m stretching the link, but a vote against the TIF-funded bond could be interpreted as a vote for Walmart. I’m not claiming that this is likely or even possible. But we do need to face the reality that the developer will still own the property if we vote down the funding, and s/he will have to make good on that investment.
    I also can’t ignore the rib-tickling irony of a reactionary group forming around the claim that CARD is a grassroots front for corperate discount chain muscle. Imagine what would be inscribed on those cloth sandwich boards!


       —Scott TenBrink    Jul. 6 '06 - 04:42AM    #
  141. So, AAiO, would you consider my comment to have been trolling, in which case you bit, or satire of your site, where discussion of an off-leash troll park would be par for the course?

    Hmmm. Does the park also involve fairy doors and breastfeeding?


       —ann arbor is overrated    Jul. 6 '06 - 04:50AM    #
  142. HEY! this damn thing is in a FLOOD PLAIN!

    doesn’t anyone else have some trepidation about spending taxpayer dollars so deep in acres of a “northern new orleans?”

    cheerrioz, toasty


       —toasty    Jul. 6 '06 - 06:40AM    #
  143. Chee Toas:

    Check out this website.

    http://www.ci.ann-arbor.mi.us/CityAdministration/EnvironmentalCoordination/FMAP_pub_4.pdf

    As I work night shift and have nothing better to do, I googled “ann arbor floodplains” (w/o quotes) and came up with this. The resolution is crappy on slides 7 and 8, but judging from what I see, I’m not so sure that the area in question is in a flood plain. Intuitively, yes, but legally, not so sure looking at the drawrings. The flood plain area for the creek looks to be no more than…well, not wide. Besides, I live in that floodplain, so I’d rather you be wrong.

    The not-serious part: If worse comes to worst, we could always issue bonds for some levees. They could double as sledding hills. And maybe dog parks. (But no dogs and sleds together, that’s crazy talk). Or troll parks, so Murph and AAIO would have somewhere to have play-dates for their trolls.


       —tim    Jul. 6 '06 - 08:07AM    #
  144. TO AAIO re post#129:
    While I have been a member of the Old Fourth Ward Association for many years, we are not all identical, just as folks who post to your site are not all identical. For example, I bought a house in a student neighborhood, so I could make noise. Students have called the police on me – not the reverse. FWIW, I DJ jazzy downtempo, and electronic dance music from tribal to Latin and Brazilian infused House.

    In addition, I don’t think government has a right to tell you what you can or cannot put on your porch, e.g. the couch ban. And I think Leigh Greden pushing for a vote on a couch ban in August, when the students were away, was highly undemocratic. I’m supporting Rebekah Warren in her race against Leigh Greden for State Representative.

    BTW, AAIO, I believe your site is hosted by my employee, George Hotelling. Ask him about me if you want an opinion from someone who has worked closely with me and also knows about my politics, my support for Open Software, Open Business, independent music vs. the big labels and transparency in government.

    I like coming up with new models and ideas for how we work and interact, but as someone trained in scientific method, I understand the necessity to adjust one’s ideas based on empirical data. We all need to have a little less ego in this debate and look for what is right for Ann Arbor, not just what supports our individual arguments. So, I hope we can treat the space on this blog as a Commons for assisting with the collection of data, not just for argument and debate. I am willing to adjust my opinion based on real data. I have been receiving lots of data from FOIA documents retrieved by people working on my campaign. We have been posting these to an internal campaign blog that uses BaseCamp. I will ask my supporters who have been gathering data to begin doing public posts in addition.

    I think that the forces of anachronistic privilege and economic protectionism are at work as we plan the future of Ann Arbor. Will the future line the pockets of a few who control the real estate market or will it reflect the desires of the people? I am not naive about the role and importance of large entities and corporations. However, we need to seek a balance of power and someone has to negotiate for the citizens. Blogs like this can be weapon against the oligarchical controls to which we are often subjected in our “democracy.”

    A friend warned me that if I get elected to City Council I will have people phoning me to ask what I will do about the fact the their neighbor’s dog pooped on their lawn. I’d like to think there are also some important problems to address. As a business owner I am a realist and understand the importance of staying grounded in what is practical and possible. But, I believe we are at a political crossroads in our country right now and that things are about to get much worse or begin to get better. I try to be humble about what is possible to accomplish in a role like City Council person, but I’d like to think that I can help push us away from representative democracy towards direct democracy. For theoretical thoughts on this see Joi Ito.


       —Ron Suarez    Jul. 6 '06 - 01:55PM    #
  145. Ron: “I think that the forces of anachronistic privilege and economic protectionism are at work as we plan the future of Ann Arbor. Will the future line the pockets of a few who control the real estate market or will it reflect the desires of the people?”

    So to be clear, you think that the people who are trying to install new projects in Ann Arbor are the privileged who ‘control the real estate market’ and line their pockets, while the downtown property owners haven’t lined their pockets, and don’t have any control over the market.

    Is this correct?


       —todd    Jul. 6 '06 - 02:15PM    #
  146. Ron, thanks for answering that.


       —ann arbor is overrated    Jul. 6 '06 - 02:33PM    #
  147. Article in today’s paper on Lowertown, CARD, etc.

    http://www.mlive.com/news/aanews/index.ssf?/base/news-18/1152196979240210.xml&coll=2

    No mention of tears, BTW.


       —John Q.    Jul. 6 '06 - 04:08PM    #
  148. Todd (re: 145), downtown property owners are certainly in a position to line their pockets. In general wealth creates more wealth and we are increasingly seeing a growing gap between rich and poor. In addition, the median income has gone down significantly since Bush took office.

    Do you think it is a good thing for wealth to become increasingly concentrated in the hands of a few, while the government decreases student loans and over 50% of all graduate students in science and engineering at US Universities are foreign students?

    I haven’t read enough of your posts to know if you are being pedantic or if you think the poor need to pull themselves up by their own bootstraps. So, quite honestly, do you think we do or do not have a problem with opportunity waning for members of society who are not overprivileged?

    I was born in Spanish Harlem, but got a full scholarship to NYU and did jobs like waiting tables and taxi driving to pay for all my expenses through college before coming out to Michigan for my PhD. I just don’t think the same educational options that helped me become upwardly mobile are as available today as they were when I attended college.


       —Ron Suarez    Jul. 6 '06 - 04:37PM    #
  149. Laura Strowe is a classy woman. I’m glad she didn’t want this “story” to distract from CARD’s good work.

    Glad to see Gantert keeps taking the NIMBY bait, too.


       —Dale    Jul. 6 '06 - 04:38PM    #
  150. Ron, Todd’s one of the good guys.

    His point is that most of this anti-developer rhetoric is coming from people who own property in neighborhoods adjacent to the downtown and have as much of a financial stake in blocking development as people who want to build. When hacks like Gantert write up the “accidental activist” tripe, people believe what they read and the self-serving rhetoric becomes conventional wisdom.


       —Dale    Jul. 6 '06 - 04:42PM    #
  151. Quote from today’s article on Lowertown – “Crawford said $20 million of the bond money would be used to build a parking structure, $4 million would be used for cleaning up toxic land on the site and $16 million would be used for “public improvements’’ allowed under the law for taking on the cleanup.”

    Would someone please enlighten me as to what we get for the $16 million? I am asking this seriously.


       —Ron Suarez    Jul. 6 '06 - 04:52PM    #
  152. Is Todd the Todd from Leopold Brothers?


       —Ron Suarez    Jul. 6 '06 - 04:54PM    #
  153. Ron, I was just trying to understand your position. You are flipping back and forth between the situation locally and nationally, and it confused me. You are apparently running for council, so I simply wanted to get where you were coming from.

    Thanks for the answer.

    As to your question, the very, very essence of my position on development in Ann Arbor (if you set aside environmental issues, of course) is that the actions of the citizens over the last few decades has specifically forced the poor and working class out of Ann Arbor. I think that that sucks.

    My position, since you are new to Arbor Update, is that if we had been working from a Master Plan, and aggressively seeking good projects rather than telling developers “nope, not this one”, we would have both market rate and affordable housing in a walkable, thriving downtownAnn Arbor this very day.

    Instead, we have gutted the downtown, locally run businesses are either closing or running for the hills, and the heart and soul of Ann Arbor has left because they can no longer afford to live here.


       —todd    Jul. 6 '06 - 04:55PM    #
  154. Yes Ron, it is. I am sorry, I keep forgetting that not everyone knows that.


       —todd    Jul. 6 '06 - 05:07PM    #
  155. “In addition, the median income has gone down significantly since Bush took office.”

    Hey, I voted for Nader then Kerry, but are you really blaming Bush for this? Maybe the dot-com bust, 9-11, and various global economic forces that have little directly to do with Bush might be bigger factors (not that he’s helped, of course). I’m just sayin’... nobody likes partisan-y oversimplified implications of blame…


       —Brandon    Jul. 6 '06 - 05:31PM    #
  156. Great. This whole party has been crashed by second-rate politicians looking for face time. First Suarez then Colenback. Cheaper than tv, I guess. Thanks guys, but no thanks.


       —Still not gonna vote for you    Jul. 6 '06 - 05:33PM    #
  157. Wow! A lot of great comments!

    Thanks, Scott, for the estimate on the bond payments.

    No, the $500,000 that the developer is supposed to pay the City does not go toward the bond payments. It is (and I’m not making this up) a “credit enhancement fee.” It is allegedly to reimburse the city for impairing the city’s credit by the issuance of so much in bonds, requiring the city to have to pay more in interest on other loans, bonds, etc. So the city is just being made whole by the $500,000. It’s not supposed to count toward the bonds.

    With regard to the incident at the Farmers Market, Laura Strowe didn’t want me to use her name here, but since the AA News has covered the story there is no harm my confirming that this is the same person.

    I want to emphasize Peter Allen’s statement to Laura that City Council had already voted on this project. So here is the original developer, and a current invester, saying Council has already voted. So he thinks the deal has already been cut! As I have suggested above.


       —David Cahill    Jul. 6 '06 - 07:09PM    #
  158. Scott, thanks for answering my question as to who holds the bag if tax revenues are lower than bond payments. It appears that there is another payment stream of $500K per year, mentioned above. That would lower the apparently significant risk to the taxpayers if it’s for real. Does anyone know what this is for, and what makes it certain (if this is so?)

    It seems from the discussion above that the answer to my question as to whether the developer actually pays the city at all—beyond the tax revenue, which isn’t a voluntary payment—hinges on the $500K per year payment I mention above.

    Scott, I’ve never heard of a plan to build a WalMart on the site. I think if that had even been discussed it would be pretty common knowledge, given the attention given to WalMarts in general. But I take it as a given that there would be something pretty large built on the site before too long. It’s too valuable a property to be left dormant. The pollution can’t be that bad if it can be cleaned up for so little (relatively speaking). And another development would probably get the same state funds and credits for doing so. It seems disingenous to me for anyone to pose the choice as the Broadway Village devleopment or the parcel remaining vacant over the long-term.

    All that learned and said, I remain in the dark on what seems like the central point. There’s considerable risk in putting up $40,000,000 without anything other than 1/2 million and tax revenues to pay it back. This doesn’t mean it’s wrong. But it leaves me wondering what the concise case for the benefits—over a “normal project” without the forty mill. being kicked in by the city—of this project are. It seems like the decision should be about balancing the financial risk versus these benefits.

    This project might be a good idea. But it’s one that deserves a lot of thought, as it isn’t something that any community can do a lot of given the limits on bond issuance.

    It seems to me that the consideration should be based on a very clear statement of both risk and benefits, which I’ve never seen. If City Council people post here, I’d hpoe that they would direct us to some resource that contains this. Otherwise this whole debate seems to collapse into a “love development” v. “hate development” argument. I know I don’t think like that, and I don’t think many people do. So this kind of polarized discussion won’t shed much light of use to most of us.


       —AK    Jul. 6 '06 - 07:27PM    #
  159. Sorry for any confusion caused by my post #158 above. I wrote the bit about the 1/2M payment being for the bond repayment without having read post #157 which says that it’s actually compensation for the increased costs caused by using the city’s credit line.


       —AK    Jul. 6 '06 - 07:49PM    #
  160. “I wrote the bit about the 1/2M payment being for the bond repayment without having read post #157”

    Sorry but we’ve all learned that anything coming from Cahill can’t be taken at face value. For all I know, he’s 100% correct. But based on his track record, I’ll want some documentation. Also, I haven’t seen any of the numbers being thrown around confirmed by anyone (myself included). I just included the bit from the article because I had not seen it mentioned yet. But the only number we know for sure is the $40 million amount. The rest is speculation, informed as it may be.


       —John Q.    Jul. 6 '06 - 07:57PM    #
  161. Plan B several years ago was for a Walgreen’s drug store, not a Wal-Mart.


       —David Cahill    Jul. 6 '06 - 09:54PM    #
  162. Well, if you read John Robert’s interview on TeeterTalk on June 29, you will see some explanation of what has or has not been voted on (short excerpt below):

    “And I think that that’s the whole misnomer of this whole thing with the bonds is that we as Council approved the intent to issue those bonds. We needed to do that because of the lag time that it takes from issuing that intent. There’s a 45-day window there. But in no way shape or form are we obligated to issue those bonds. Up to this point and currently, Tom Crawford and his group, and there are City sub-committees that are working with the developer, to make sure that they’re meeting certain performance standards. As they hit those performance standards, it’s minimizing the risk that the City’s at. So that’s where things are there.”

    Oh, and thanks HD for your great site!


       —Juliew    Jul. 6 '06 - 09:58PM    #
  163. Easthope was in the paper today saying unless the numbers are right and the financial team signs off, this project is dead. The City CEO seems very on top of this. This months Observer said the city was studying this very carefully. Roberts said essentially the same thing. Plus the developer has to prove he has 75% of the square footage pre-leased. The buildings have been approved but that is it, the city council can pull the plug at any time. It is clear to everyone but David and Laura who live up the street, that unless everything proves out and there is a positive recommendation from the city finance/legal team, the development will not go forward. So why do we need CARD?
    The $40 million that has been thrown around could also be reduced. Say the project can only support $30 Mil. in bonds, the city could choose to go that way as well. In short, they can do anything they want to. What will go there if this does not? There are several big box and other stores that would fit the zoning, without a PUD, so they could just do it. And, what if a certain 800 pound gorilla who has been buying up everything in sight in this area, gets the property, nobody can control what they might build.


       —Dustin    Jul. 6 '06 - 10:24PM    #
  164. And, that 800 lb. gorilla would remove the land from the tax rolls.


       —Leah    Jul. 7 '06 - 12:29PM    #
  165. Neithr Roberts nor anyone else has explained his remark about “lag time”. What was the big rush to issue that notice of intent before the staff work was done?

    On Saturday, July 8, from 10:00 to 12:00 at the Courthouse Square (corner of Huron and Fourth Ave.), the Democratic Party is having a Candidate Forum for the August primary races.

    Maybe the various officeholders and candidates will explain or clarify their positions/non-positions on Broadway Village at that time.

    Petitions will be available for signing and circulating, naturally. 8-)

    All are invited!


       —David Cahill    Jul. 7 '06 - 12:54PM    #
  166. One of the aspects of Arbor Update that I love is even “second rate politicians” can post. ;-)


       —Tim Colenback    Jul. 7 '06 - 03:18PM    #
  167. Gorilla? Why, whatever could you mean by that …

    We’re intending to invest more than $1 billion over the next 10 years in patient care facilities


       —Juliew    Jul. 7 '06 - 03:51PM    #
  168. Mr. Cahill: It occurs to me that issuing the notice of intent while you are still doing the evaluation of the financials makes sense. Why not do this so that if things turn out postive, then you are ready to proceed. If they do not, then you can pull the plug. Why let the time go by, council seems to postpone so many things and this has been in the works for years. They should go ahead or kill it soon, so that if they are not going ahead, the university will be free to move in and build parking structures and clinics and what not. Or, clear the way for Walmart, they would make a killing with all the Ann Arborites rushing to get things on the cheap.


       —Dustin    Jul. 8 '06 - 03:19AM    #
  169. Having moved here a year and a half ago, my girlfriend and I constantly wondered why it was that this town seemed so limited in nightlife, why we have to drive 20 minutes out of town to complete our grocery list, and why the remaining local merchants on main street seem to only be interested in catering to the condo folks living in the outlying parts of town.

    Coming from a smaller-sized progressive town (northampton, MA) and seeing similar development / gentrification problems, I could only conclude that A2 “must have been really cool like ten years ago or something”.

    Now I’m beginning to see how every interest in this town seems to be shooting itself and everyone else in the foot.

    Considering we’re just across the bridge in Kerrytown, the Broadway development would be solid gold if it provided something other than a starbucks (sweetwaters is indistinguishable, and two blocks away) and the apparently proposed, as js so perfectly put it in post #8 “HP Pickleshitters”.

    Todd – as a sporatic but frequent Leopolds patron, I’m sad to hear the atmosphere here isn’t condusive to opening another location (in the frequently turned-over and largely overpriced location where marketplace grill currently stands, for instance). If one of us wasn’t tied to the university, this would certainly be amoung our disgustingly long list of reasons to move to Ypsi.

    p.s. The website looks better. I was about to start offering pro-bono just so I wouldn’t have to see the old one anymore ;]

    “still not going to vote for you”: because Ron’s running for office means he shouldn’t get involved, comment, or ask questions on in a local political issue? Sure, there’s a bit of grandstanding there, but if local politics isn’t a place for aspiring local politicians, I’ll have to start preparing my campaign over at Leopolds some evening soon. zuh?


       —Adam    Jul. 8 '06 - 12:00PM    #
  170. (Not that I’m against the marketplace grill mind you, they’ve actually got some nice place. I’m just not terribly convinced it has a longer shelf life than the other, very similar establishments that’ve existed there.)


       —Adam    Jul. 8 '06 - 12:33PM    #
  171. I’ve just received an updated set of minutes from the secret team meetings, plus three separate spreadsheets calculating the tax captures.

    I’ll e-mail these to juliew for posting here on Monday.


       —David Cahill    Jul. 8 '06 - 01:53PM    #
  172. The double super-secret team meetings?


       —Dale    Jul. 8 '06 - 03:31PM    #
  173. Yep.


       —David Cahill    Jul. 8 '06 - 04:19PM    #
  174. Mr. Cahill: Maybe I am missing something but if these are secret meetings, then how do you have the minutes and spread sheets? You must be an insider on all this….


       —Dustin    Jul. 8 '06 - 06:20PM    #
  175. Dustin, I got the first installment of the minutes over the transom from a confidential source. The more complete set of minutes, plus the spreadsheets, came from someone who made a FOIA request and gave copies of the results to me.

    And now – another issue in the ongoing saga. Here is a copy of an e-mail sent to Peter Allen this morning by Peter A. Davis, a local attorney. I don’t know Mr. Davis, and I don’t know why he sent me a blind copy of his e-mail. I have deleted e-mail addresses. Here it is:

    Peter – I was disappointed to read Tom Gantert’s report in Thursday’s Ann Arbor News about your interference with Laura Strowe’s constitutional right to collect signatures on a petition at the Farmers Market this past Wednesday. I think nearly all disinterested readers of Tom’s article would agree that your bullying of her and calling her dishonest was just terrible. She was right and you were wrong. The so-called “loan” of 40 million dollars of public funds has all the earmarks of a gift, which would therefore violate the Michigan Constitution of 1963.

    In responding to his opponent’s similar disingenuous argument, Abraham Lincoln once asked a jury: “If you call a tail a leg how many legs does a dog have?” Pausing, he then gave them the answer: “Four. Calling a tail a leg doesn’t make it a leg.”

    Peter A. Davis
    Davis & Kuhnke, P.C.
    405 N. Main St.
    Ann Arbor, MI 48104-1157
    734-663-2233 (fax- 3173)

    End of e-mail. I will call Davis on Monday and find out more about his theory that Broadway Village’s funding violates the state constitution.


       —David Cahill    Jul. 8 '06 - 07:49PM    #
  176. Oh, wow. I am just waiting to watch this lawyer figure out how what seems like pretty conventional TIF financing practice is suddenly unconstitutional.

    I’m sure this guy’s firm is super-familiar with land-use and development law:

    “We represent victims of medical malpractice, vehicle collisions, construction site and factory accidents, premises accidents and other kinds of incidents resulting in death or personal injuries”

    1-800-CALL-SAM


       —Brandon    Jul. 8 '06 - 10:51PM    #
  177. Wow, judging from the “services” section of Peter Davis’ website, I’d say they have next to no experience at all in this field. As a disinterested reader, I was more puzzled by Laura Strowe’s assertion that “since nothing comes out of the developer’s pocket, the city is in essence giving the money to them.” Isn’t this a $180 million dollar project? Last time I check $180 million – $40 million = $140 million. Where is that $140 million coming from? Not me and not you. I’m guessing from the developers, and $140 million is a long way from “nothing.” I’d like to get my hands on that nothing. I also found it interesting that Davis says it violates the Michigan Constitution of 1963. Great, how long is that document? For a lawyer he couldn’t have been more vague. No aticle number or anything. It seems that he might be referring to Article VII Section 21, if this were in fact a gift. However, given the fact that most people excepting CARD and Davis dispute the fact that this is a gift, I’m not buying that. That email makes me feel all warm and fuzzy and seems about as serious as a warm fuzzy. The basic gist of it, if you take out all the lawyer bs (including the Lincoln quote) is the last sentence of the next to last paragraph: that he thinks the $40 million might be a gift. Great, where’s his proof? I think that the world might be flat and I have a JD. Does that make it true?

    But still, the best part of this whole concocted controversy, speaking of dishonesty, is the fact that at least David (and I’m guessing Laura and a few other CARD members) live on Broadway. For the longest time I didn’t know what NIMBY meant (we don’t have fancy acronyms in Appalachia), but I’ve got all the NIMBYisms I’ll ever need on this one thread. Thx David, I needed the education.

    Tim

    PS The addition of the Abraham Lincoln quote just goes to show how weak the actual content of the letter truly is.

    PPS David: I believe you when you say you don’t know why he sent you a copy of the emial—really, I do.


       —tim    Jul. 8 '06 - 11:57PM    #
  178. I believe that the office of Davis & Kuhnke shares an alley with Peter Allen’s Kingsley Lane project. Coincidence? You may not need to go all the way to Broadway to find the NIMBY hiding in this story.


       —Parking Structure Dude!    Jul. 9 '06 - 04:42AM    #
  179. FWIW, here is Article VII, Section 21:

    The legislature shall provide by general laws for the incorporation of cities and villages. Such laws shall limit their rate of ad valorem property taxation for municipal purposes, and restrict the powers of cities and villages to borrow money and contract debts. Each city and village is granted power to levy other taxes for public purposes, subject to limitations and prohibitions provided by this constitution or by law.

    Sorry, I don’t see how this section applies. I’m also not vouching for Davis’ theory. It is a bit odd to see how the well-established brownfield program, plus the equally well-established municipal bond program, could result in something that is unconstitutional.

    The issue before the petition signers is simpler: Should we have a vote of the public on a City subsidy of $40 million paid to a private developer, when the total cost to the taxpayers of that subsidy is at least $80 million? And more if the project tanks?


       —David Cahill    Jul. 9 '06 - 01:01PM    #
  180. This just in –
    Council member Stephen Rapundalo (D-Second Ward) has signed the petition.


       —David Cahill    Jul. 9 '06 - 01:10PM    #
  181. Apparently it’s Article VII, Section 26:

    Except as otherwise provided in this constitution, no city or village shall have the power to loan its credit for any private purpose, or except as provided by law, for any public purpose.


       —David Cahill    Jul. 9 '06 - 05:05PM    #
  182. _ no city or village shall have the power to loan its credit for any private purpose_

    Wait, I thought it was unconstitutional because it’s a gift.


       —ann arbor is overrated    Jul. 9 '06 - 07:04PM    #
  183. ” or except as provided by law, for any public purpose.”

    Oh wait, it’s legal. This is beyond stupidity.

    David C. – Did you work for the developers who opposed the Greenbelt? Because this sounds just like the tact they took to battle the Greenbelt proposal. They knew they couldn’t defeat it on its merits. So they concocted fake legal arguments purporting to show how the Greenbelt was illegal. They knew the arguments were fake. But they figured if they told the lie often enough, it might scare some people into voting “No”. Glad to see you’re adopting their scummy tactics.


       —John Q.    Jul. 10 '06 - 01:43AM    #
  184. Heh. No, I didn’t work for the scumbag developers who opposed the greenbelt. 8-)

    Again, I don’t vouch for Davis’ theory. However, “except as provided by law” means, in this case, “except as provided by state statute”.


       —David Cahill    Jul. 10 '06 - 12:53PM    #
  185. The proposal is legal and consistent with state statutes. So what’s your point David C.?


       —John Q.    Jul. 10 '06 - 02:39PM    #
  186. What makes you think “the proposal is legal and consistent with state statutes”, John Q? Have you read all applicable statutes (including the brownfield legislation)? Have you read all the cases interpreting Article VII, Section 26? Or has a lawyer told you the proposal is legal? If so, who?

    I have no idea what to make of Davis’ argument. He is not me.

    We will just have to await further developments (so to speak).


       —David Cahill    Jul. 10 '06 - 06:37PM    #
  187. Here are the documents from David Cahill. The first one has the updated minutes and the last three are from the Developer.

    Broadway Village Minutes Through June 16
    Millage Analysis
    Tax Capture TIF Analysis
    Tax Capture TIF Analysis 2


       —Juliew    Jul. 10 '06 - 07:19PM    #
  188. Council member Bob Johnson (D – First Ward) has just endorsed the petition drive.


       —David Cahill    Jul. 10 '06 - 10:55PM    #
  189. That’s not a big surprise since he was against the project when it was going through the planning process.

    What kills me about the petition process is (and I know that this is the real goal) that it slows down the whole project, and may kill it, for what? I was very excited when I heard about the whole plan; I live on Maiden Lane, and was looking forward to having a coffee shop just down the street, a restaurant just a 3 minute walk from home where my husband and I could get a bite to eat, an ice-skating rink in the winter, and sidewalk art shows in the summer… But instead this same small group of vocal people who couldn’t get council to stop it continue to throw wrenches in, and we’ll probably end up with a big ol’ Walgreens (yippee..) on the corner because at some point it won’t be worth it for the developer to deal with the PITA-people. As has been asked in this thread many times already—what is it you really want for that site, Mr. Cahill? Because I fear you’re cutting off your nose to spite your face (and ultimately the face of all of us that live in the neighborhood.)
    The argument regarding the bonds is a false argument, and it’s quite obvious to me from reading through the “super secret” team minutes that have been posted on this site show that the city IS quite on top of the due diligence, including the finances. But instead we’re seeing the same old micro-management coming a small group of people in this town who believe they know better than all of us how to do everyone’s job.
    And please stop crowing about how “Democrats” are involved in this, like it’s only natural for Democrats to oppose this project. I’ve been a bleeding-heart liberal Democrat since I was born, and I was embarassed to read about the “Lunch Bunch” signing the petition to derail this project without even wanting to hear what it’s all about. I like to believe that Democrats are people who interested in making informed decisions, but apparently not all are.


       —Lane Maiden    Jul. 11 '06 - 04:17PM    #
  190. UM will buy it and build something big with noisy cooling towers. Or, Google at 10 stories, or Walmart, they fit the zoning or it could just sit there for another 10 years as CARD hopes.


       —Dustin    Jul. 11 '06 - 04:39PM    #
  191. As every schoolchild knows, even if this project were totally without risk (assuming that anyone can project rents out for 30 years), the taxpayers would still be subsidizing this private project to the tune of $40 million. The petition drive would just force a vote on that.

    As Ron Suarez so cogently pointed out last night at the League of Women Voters debate, the City should not subsidize a project that the developer’s bank won’t finance.


       —David Cahill    Jul. 11 '06 - 09:50PM    #
  192. “the City should not subsidize a project that the developer’s bank won’t finance”

    If that is the core issue, then supporters of that position could suggest city policy along those lines. If that’s not the core issue, let’s dispose of the straw man and move on to what is.


       —Steve Bean    Jul. 11 '06 - 10:05PM    #
  193. “As every schoolchild knows…the taxpayers would still be subsidizing this private project to the tune of $40 million.”

    Schoolchildren, take note that state taxpayers will be subsidizing Google to the tune of 38 million dollars in tax credits. Watch for Mr. Cahill’s petition against Google at a street corner near you.


       —John Q.    Jul. 11 '06 - 10:34PM    #
  194. I’ve stayed out of this one, and I have a fair amount of sympathy for CARD, but…I have to admit blocking this development without an alternative seems a little weird. “If only we could leave this rotting concrete brownfield around for another decade or two…reminds me of The Way Ann Arbor Used to Be every time I drive by…ah, memories.”

    Maybe they’ve just been getting bad press or something.


       —Young Urban Amateur    Jul. 11 '06 - 11:17PM    #
  195. Unfortunately, not every “schoolchild” is familiar with the purpose of brownfield incentives, so let me share a little information so that we can all make better informed decisions about the issue:

    According to the article in the Ann Arbor News, the brownfield incentive includes:

    * $20 million for a public parking structure

    * $4 million for cleanup of tetrachloroethylene-contaminated soil and groundwater (migrating to the Huron River and neighboring residential properties)

    * $16 million for “public improvements”

    Reimbursement for these eligible activities are allowed under State law.

    I just want to address what this brownfield incentive is supporting. Regardless of what Mr. Cahill is calling a “subsidy” or “gift”, this bond is an incentive meant so the developer agrees to take the risk to do the brownfield redevelopment project; the taxpayers do not pay for the incentive – the increased taxes that are generated from the redevelopment, and that wouldn’t exist without it, pay for the incentive (which is why the city is being so diligent in reviewing the financials – to make sure the numbers will work before they issue the bonds).

    This project could benefit us all. This developer (or any other) will not take the risk of the cleanup and redevelopment without incentives to offset costs and reduce financial risk due to the nature of this site as a brownfield. That is a fact with ANY brownfield development project. That is how the brownfield program is meant to work – bring contaminated, abandoned and/or under utilized properties back into productive use, simultaneously preventing sprawl because the developer isn’t using “greenfields” for their development. If the developer makes a profit on a great neighborhood project (that creates temporary and permanent jobs), great! We get this wonderful development that’s left behind to enjoy. We all win. Any developers who take a serious look at site as it exists now would expect a similar incentive package.

    I encourage everyone to do their own homework, and I think you may come to realize that this a unique opportunity for a world class brownfield redevelopment project; we need more of these, in my opinion—not the big box sprawl we’ve all seen too much of in the last decade—but they won’t happen without our support, and they certainly won’t happen if we make it so difficult for a developer to do them that they’re better off developing a greenfield. Please let me know if you’d like more information on how Michigan’s Brownfield Act (Act 381) works. I would be happy to provide technical details and examples of other successful projects.


       —Lane Maiden    Jul. 12 '06 - 01:38AM    #
  196. Well said.

    If this opportunity and all the time and money put into it falls apart because of a thinly-veiled NIMBY campaign aimed at misleading the general public about a complex project over which they have little understanding, it will be a sad day in this town.


       —Brandon    Jul. 12 '06 - 02:20AM    #
  197. From #192: “If that’s not the core issue, let’s dispose of the straw man and move on to what is.”

    Being an ardent reductionist by nature, that sounds like my cue to finally chime in. What really IS the core issue here? So far, we’ve seen a full brigade of straw people. More and more, this long thread reads like an attempt by CARD to locate and develop winning “talking points” for its referendum campaign. Various arguments & angles are trotted out one by one, and then we see how well they fly among the often-skeptical readers of this site. I’ve learned much while watching these arguments get deconstructed, yet this process starts to get tiresome as we near entry #200 in the thread.

    To recap: first, we are told Broadway Village is bad because the subsidy won’t get repaid, and the city decision makers just don’t care (for some unspecified reason); plus, the city no longer has any leverage on this project anyway. As that particular line of reasoning wobbles noticeably after a while, the very idea of a subsidy itself starts to become bad, regardless of whether the funds are recouped, since it is just a ruse to feed at the public trough as a “benefit” of onsite pollution. Then a new twist is the “failure” of the DDA to add lower Broadway to its jurisdiction. When nobody bites on these morsels, we move to the concept that providing a subsidy might be an illegal application of existing laws that no one noticed until a few days ago. Now, we find ourselves moving back to the idea that a subsidy is inherently bad, with the emphasis changed to wealthy private developers getting themselves a drug fix from public tax dollars, much like a sports team that builds a new stadium with city/state revenues after successful political arm twisting.

    If the entertainment value of this evolving technical banter is the main reason folks come here, then that’s fine. Otherwise, I’d like to propose the following: that we swear upon a stack of Ayn Rand bibles (“Atlas Shrugged” will do) to simply ignore the libertarian argument-of-the-moment . Don’t bother responding to any assertion that a public subsidy to a private development is necessarily evil and can’t be used as one kind of tool to regulate favorably for an agreed-upon public good—which may include not only environmental cleanup but also affordable housing, locally-owned retail, parking, open public space, etc.

    Instead, let’s talk directly about ‘Broadway Village’ – what’s good about it, what’s passable, what’s terrible, and what still can be done to make it better than the current plan. Amazingly, so very little has been said about that. Maybe the project is too big and too likely to become another yuppie theme park, albeit one with a med school flavor, and should best be ditched if possible. Or maybe much can change under additional further city pressure, resulting in a future civic asset. As a cue to you city insiders and planner types, I’d like to get an idea of what more can we do at this hour through city mechanisms to get the developers to include more of what we see as real public needs. This is the kind of discussion that—if it spreads more widely—will slow down a CARD campaign, as it will demonstrate an alternative to either passively accepting the developers’ “vision” or else voting “no” on the subsidy without any concept of what one actually want there.


       —hale    Jul. 12 '06 - 02:53AM    #
  198. I think that there are two pertinent considerations in trying to understand the possible reasons (not rationalizations) for citizens’ discomfort over this development.

    First, the costs of brownfield cleanups were passed on to the public years ago by the state government. Whether that was necessary in order to ultimately get the various contaminations removed (because some offending businesses had insufficient resources to pay for it, court costs ate into the funds, etc.), or if it was a gift to the responsible industries (their owners, stockholders, etc.) remains up for debate (though most people just accept it since both major political parties do.) The result of this is that the redevelopment process is tainted (in the eyes of those with long memories… and a sense of justice) by the need to publicly subsidize it. However, given the current laws, we have little choice but to make the best of the situation and get as complete a cleanup as possible and the best development as possible for the community. (Note: parking structures and “other” public benefits weren’t the impetus for the law.)

    Secondly, as with property tax abatements for businesses, granted by city council, the brownfield redevelopment subsidy process lacks a clear policy on the criteria for granting requests. As far as I can tell, this is a failure on the part of councils past and present to get out in front of the process enough to ask the relevant questions in advance and establish a policy for the benefit of the community, including those who want to develop here. The reasons for that failure (if it truly is one) probably span from the understandable to the hard to excuse. At this point, though, we have a developer making a legitimate request that needs to simply be evaluated on its merits.

    Should the city have a policy to “not subsidize a project that the developer’s bank won’t finance”? Maybe. I don’t know enough to say whether that even makes sense. My guess is that its a non-issue.

    Should the city have a policy to limit the total subsidy to a brownfield redevelopment project relative to the environmental cleanup costs? Probably. We can argue where to draw the line. 1000% seems high. 100% seems rigid and shortsighted. 200% to 500% seems like a reasonable range to consider.


       —Steve Bean    Jul. 12 '06 - 04:11AM    #
  199. Here is a letter a local developer just wrote to the Mayor and Council about the project – and the subsidy:

    July 11, 2006

    Dear Mayor and Ann Arbor City Council Members:

    I am contacting you to express my concern regarding
    the Ann Arbor City Council’s resolution to issue a $40
    million bond to subsidize the Strathmore Company for
    the development of the proposed Broadway Village
    project in Lowertown. While I support the
    development, I feel that the $40 million bond is a
    very unwise use of taxpayer dollars, and I urge you to
    rescind this agreement.

    I am a long time resident of the Lowertown area, and
    am a real estate professional with experience in
    residential/commercial development and leasing. Until
    recently I had been a consistent supporter of Broadway
    Village, and I would still like to see the project
    built. Even though I personally share the
    reservations of some who believe the proposed
    development is too large, I believed that the
    developers/investors should be allowed to build the
    project which they felt best suited the site’s
    location and zoning.

    It was not until I read a recent article in the Ann
    Arbor News that I became aware of the City’s of
    agreement to provide the developer with a $40 million
    loan, in the form of a taxpayer-backed bond issue.
    Since that time, I have tried to learn the full scope
    of the agreement – what the developers will use the
    $40 million for, how the city will be repaid, what the
    risks are, etc. In particular I have been trying to
    understand what it is about this particular real
    estate project that warrants such an unprecedented
    investment of taxpayer monies. My understanding is
    that of the $40 million $4 million will be used for
    brown-field clean-up, $26 million will be used to
    erect a 6 story parking structure, and that the
    remaining $10 million will be used for other
    “infrastructure improvements.”

    Following considerable research, including attendance
    at a recent meeting with Strathmore Development, I am
    convinced that the proposed $40 million bond is an
    extremely bad idea, from both a policy as well as a
    business perspective. In terms of policy, the use of
    public funds in Ann Arbor’s relatively healthy real
    estate market is not only unnecessary but actually
    harmful, as it skews prices (mostly upward). Since the
    deal with Strathmore was signed in 2002, we have seen
    a number of developers undertake ambitious projects in
    the city without the benefit of public funds. In
    fact, some of these companies are paying into the
    city’s affordable housing fund in return for
    permission to build projects which are considerably
    smaller than the proposed Broadway Village. Why does
    Strathmore warrant this exceptional taxpayer
    generosity – especially in light of the city’s
    budgetary constraints?

    Beyond unsound public policy, the city has negotiated
    a dismal business deal. At the end of the day (after
    30 years), the city will own a parking structure that
    will be in need of repair/renovation – i.e. more tax
    dollars.

    Of the various claims that have been made in defense
    of the $40 million bond, among the most disconcerting
    is the assertion by Strathmore that they will not be
    able to finance the construction of Broadway Village
    without the $40 million loan, because no bank would be
    willing to finance the parking garage. The argument
    is disingenuous, since this is how Strathmore has
    chosen to structure their deal. There are a number of
    different financial models that could make the deal
    work without the city’s money. One approach is to
    simply value the parking structure as a money
    generating asset – i.e. paid for by users. Another
    approach would be for Strathmore to sell part of the
    development rather than plan to own and lease 100% of
    it – thereby netting enough revenue to pay for the
    parking garage and other necessary infrastructure
    costs.

    As for the $4 million which is allocated to the
    brown-field clean-up, the city should not link this
    cleanup to Strathmore’s or any other developer’s
    project, but should rather pursue expedited
    remediation in order to prevent the toxic plume from
    reaching the Huron River.

    Finally, it’s distressing that thousands of taxpayer
    dollars have already been spent and continue to be
    spent in the form of extensive city staff time and
    travel devoted to monitoring Strathmore’s compliance
    with the terms of the $40 million bond. Should the
    City of Ann Arbor really be in the real estate
    development business, when there are so many other
    unmet needs in our community? And of all things, do
    we really want to put our money into an automobile
    parking structure, instead into promoting
    transportation alternatives – such as car sharing?

    I realize that there is currently a petition drive to
    put the $40 million bond issue to a city-wide
    referendum, and I applaud its organizers. However, I
    believe there would be less contentiousness, less
    development delay, and a quicker end to the city’s
    involvement in this unwise venture were City Council
    to act responsibly and rescind the $40 million
    subsidy. City Council has done a commendable job in
    the past several years in promoting respoinsble
    development projects in the downtown area. Please do
    not set a damaging precedent by making an unwise use
    of taxpayer monies. Again, I urge you to reverse the
    council’s earlier resolution and rescind the $40
    million subsidy. In summary: “Yes to responsible
    development, no to unnecessary subsidy.”

    Respectfully,

    Jack Edelstein, Ph.D.


       —David Cahill    Jul. 12 '06 - 01:50PM    #
  200. This reminds me of Tom Tomorrow’s “Yoostabee” cartoons—I yoostabee a supporter of development, then I read the Ann Arbor News.

    How could he be a real estate professional and not know about Broadway Village financing? Well, at least we know he doesn’t have an ulterior motive.


       —Dale    Jul. 12 '06 - 02:18PM    #
  201. Come on, Dale. Make an argument. What about his analysis do you disagree with? Is it inaccurate in any way? He gets his news from the local newspaper, so he’s not sufficiently involved to have an opinion? I think he poses some useful questions.

    At least give him credit for writing a letter to council as opposed to an email to Peter Allen (or starting a petition drive.)


       —Steve Bean    Jul. 12 '06 - 02:58PM    #
  202. I did make an argument, Steve. Since this “real estate professional” is jumping in at the last minute and got his information about this project in his back yard from the News (just after Cahill and Co. began their effort to promote fear and misinformation in this part of town), we should seriously consider the possibility that this really has to do with his blocking development on his street. You might also note the last tip Cahill fed us—that a TIF is unconstitutional. Anything associated with him is difficult to take seriously.

    I would not expect anyone who had any engagement with Ann Arbor real estate to get their information from the News. They talk to each other.


       —Dale    Jul. 12 '06 - 04:42PM    #
  203. I would also expect a real estate expert to differentiate between projects that have minimal remediation issues and a site like this. He does raise some legitimate questions. But acting as if this site is no different than any other site that has seen development in the past 4 years seems like a simplistic analysis to me.


       —John Q.    Jul. 12 '06 - 05:30PM    #
  204. Guilt by association, Dale?

    Do you not have concerns about floating $40 million in bonds to accomplish a $4 million cleanup? If it were $100 million in bonds would your position be the same? Where do you stand/where would you draw the line? Make an argument about the issue, not the people involved and their alleged motivations. That’s Cahill’s approach, remember?

    John Q, his letter could have been stronger, but I think his concern about precedent (or as I put it earlier, the absence of a clear policy) is one of those legitimate concerns you noted. That in itself is a pretty clear differentiation from other downtown developments (and it reads as if that was his intention in expressing it.) In addition, he makes several comments about the parking structure as a key component of the deal, which could be seen as another difference.

    However, I don’t agree with one specific point:

    “As for the $4 million which is allocated to the brown-field clean-up, the city should not link this cleanup to Strathmore’s or any other developer’s project, but should rather pursue expedited remediation in order to prevent the toxic plume from reaching the Huron River.”

    Expediting the cleanup isn’t necessarily a wrong-headed idea, but I suspect time is not of the essence in this case. Aside from that, the brownfield program was set up specifically for this purpose. We would have to be in a very serious situation to justify not making use of it.


       —Steve Bean    Jul. 12 '06 - 06:22PM    #
  205. Steve—thanks for your notes in #198 on the history of brownfield cleanup financing. That historical context most likely explains some of the underlying motivation behind CARD, and why they feel they can draw a lot of support by making the proposed subsidy an issue.

    Plus, your idea of setting up a very basic mathematical model for determining an appropriate subsidy for brownfield cleanup on a development site has me pondering. I have almost zero experience or knowledge of what’s possible or what isn’t when units of local government negotiate with developers over the “contents” of a project, but am now further intrigued about using the subsidy as a tool for civic purposes. Working from your premise that $40 million is a bit much for an estimated $4 million environmental cleanup, could the subsidy amount be adjusted up or down based on the developer making new & firm alterations that Council thinks will increase the “public good” in the project?

    For example, let’s say that if Strathmore’s current plans do not change, the final subsidy amount is lowered to $15 million (375% of cost). Should a sizeable percentage of planned condo space for the well-off be allocated instead for housing that’s far more affordable, make the subsidy $25 million. Add to this an upgrade in energy efficiency for the seven buildings, and move the subsidy up to $30 million. And so on.

    If a scenario similar to this is at all possible—and I have no clue – the city would have at least one way to make the current Broadway Village plan better. If Strathmore balks on the idea of negotiating civic improvements in return for a larger subsidy, then leave them with $12-15 million, a much-reduced amount which should take the air out of CARD’s main campaign plank.

    I hope you planners & insiders will help school me on this. My recent readings of Colin Tudge and Jared Diamond aren’t of much help in regard to modern civics, though I do know a little more about the rezoning of mammal habitat as the glaciers retreated.


       —hale    Jul. 13 '06 - 01:11AM    #
  206. As I mentioned above, “brownfield” isn’t limited strictly to chemical contamination – it also includes “functionally obsolete or blighted facilities”. If you’re/we’re trying to come up with a formula or rule for how much we think is appropriate, what is the $$$ value of “remediating” a “functionally obsolete facility”? Is it the cost of demolishing the old Kroger/CVS? The cost of demolition + site work sufficient to begin new construction? Some part of the new construction? What exactly is “remediation” of a long-vacant Kroger, anyways?

    The problem with setting a specific formula (and, I expect, the reason one does not exist in the State enabling legislation) is that it’s relatively easy on the one hand to define clean-up costs for a given spill of tetrachloroethylene or whatever, and quite another to define “clean-up” costs for the general case of “blighted properties”.


       —Murph    Jul. 13 '06 - 12:52PM    #
  207. I understand that the sewer lines (and maybe other utilities) through this area are some of the oldest in the city, and are suffering, and I thought they needed to be upgraded when this development is built. Actually I think the city is holding their breath on some of these because if they are not repaired / replaced with this project they will have to done as a stand alone project which usually is more expensive. I assume some of the $16 million mentioned above is for this type of infrastructure also which, if so, is clearly a public benefit. In the past the city has blamed some of the old mains for sewer problems in neighborhoods and has used the capacity issues to hold up and delay projects.


       —abc    Jul. 13 '06 - 02:44PM    #
  208. Murph, I’m no expert, but I think it would just be a demo and removal line in the budget of the new development. Seems pretty straightforward and not unusual.

    On the other hand, toxics cleanup is ‘extra’ as far as the developer is concerned. If they could just build over it, most would (as long as it’s moving down and not up.) That’s the need for the incentive.

    Some communities also need to give incentives to redevelop “blighted properties”. Ann Arbor isn’t one of them. Therefore, I don’t think your first question is relevant. The “other public benefits” component is relevant, but I think it’s a gray area for Ann Arbor. The contamination is the barrier and is the piece we, as a community, have been given responsibility for handling. We need to decide how important those other benefits are to us, relative to the cleanup (i.e., the core concern.) The question is, “How much is it worth to our community to help finance a cleanup?” (Answering in terms of a multiple of the cleanup costs just seems like a simple way to consider it. I’m open to other suggestions.) A policy would help sharpen the image, for both the public and the developers, and possibly resolve the trust issue that underlies the petition drive.

    Also keep in mind that the brownfield TIF isn’t the only tool we have to encourage redevelopment.


       —Steve Bean    Jul. 13 '06 - 03:28PM    #
  209. In 2003, Council member Kim Groome (D-First Ward) pushed hard for the Brownfield Review Committee to actually set a brownfield policy along the lines Steve Bean is suggesting. To no one’s surprise, the majority of the committee said let’s approve Broadway Village first, and then think about a policy. Of course the subsequent policy discussion never happened.


       —David Cahill    Jul. 13 '06 - 08:24PM    #
  210. “Of course the subsequent policy discussion never happened.”

    The cynical would take this as evidence that people were only interested in such a discussion as long as it was a way to delay Broadway Village approval.


       —Bruce Fields    Jul. 13 '06 - 09:00PM    #
  211. It seems that some of the folks living near the proposed development have been accused of being NIMBYists. It also seems that some supporters of the project have acknowledged that as currently proposed, this is not the perfect project, not the perfect fit, but that their support of the project comes out of fear as to what might happen at the site if what is currently proposed by the development team is not exactly accepted. Shouldn’t the NIMBY folks currently living near the development site be the most fearful of what might happen? Is the lack of cowardice exhibited by these NIMBYists just plain foolish?


       —EJ    Jul. 13 '06 - 09:28PM    #
  212. “It also seems that some supporters of the project have acknowledged that as currently proposed, this is not the perfect project, not the perfect fit,”

    There are no perfect projects and projects are never a perfect fit with the surrounding area. There are people who will oppose any development (Cahill) who are by definition NIMBYists and those who would accept anything. Most people fall somewhere in the middle and recognize that there are no perfect solutions and try to decide whether the benefits are greater than the costs. I think most people recognize that the current site is a problem that needs to be addressed, the question is how best to address it, not whether people “fear” what might happen there.


       —John Q.    Jul. 13 '06 - 10:07PM    #
  213. EJ (#211): You may be just entering this thread, yet I feel compelled to be the umpteenth person here to ask what it is that BV opponents WANT on this site. Does everyone on the Broadway corridor from Northside Grill all the way up the hill to the ICC co-ops dream blissfully of a new Walgreen’s? Or a 10-story UM tower? Or something else? Please tell us! There’s been a deafening silence from CARD supporters on this, which does much harm to their credibility.

    “Of course the subsequent policy discussion never happened.”

    If it didn’t happen despite Kim’s best efforts, it would be good to have a brownfield policy discussion in the near future. For the moment, the lack of a clear policy could theoretically allow Council flexibility to use the brownfield subsidy as a tool to negotiate helpful tweaks in the BV project, if they desire to try that.

    “Also keep in mind that the brownfield TIF isn’t the only tool we have to encourage redevelopment.”

    To enlighten those of us who aren’t civic professionals or land use activists, can someone give a quick synopsis on some other tools that the Council & the larger community could use? And, specific to Broadway Village, are there any that could be usefully applied at this late stage without adding much in terms of additional costs & delays?


       —hale    Jul. 13 '06 - 11:02PM    #
  214. In some ways, I can at least begin to empathize with the BV opponents (and the public in general), especially after reading what Ron Suarez (thread #127) wrote of the very recently conducted Northside Grille meeting, “I was there when the developer attempted to mislead people into thinking the 45 day clock had not yet started for a deadline to collect signatures to oppose this. Only at the end, after several people pressed him for an explicit answer did the developer say he “misspoke” earlier when he implied that the clock had not yet started ticking. This was a big red flag for me.”

    In my opinion, I believe that such responses from the developer hardly qualify as ‘appropriate’ dialogue.

    So, when it is asked for the umpteenth time, “what is it that BV opponents WANT on this site?” maybe a very good answer to this question might be that, #1) for starters, the public deserves a more ‘appropriate’ dialogue.

    I can’t speak for them, but maybe CARD is hoping that a successful petition drive will result in just this: ‘appropriate’ public discourse.


       —EJ    Jul. 14 '06 - 03:28AM    #
  215. There was a ton of public discourse on this development over a year ago and that was after what, a year of discussion? The same people who were against the project then, are against it now and they have come up with CARD. Funny thing is, as I recall from watching the public hearings, more people from the area were for it than against it. For the umpteenth time: it has been made very clear that the city is looking at this very closely. Every city council member at the debates affirmed this and said that nothing would go forward unless it is in the best financial interest of the city. The numbers have to work. So, why do we need CARD?


       —Dustin    Jul. 14 '06 - 03:57AM    #
  216. I was not at the Northside Grille meeting just recently held this past month, so I can in no way whatsoever begin to personally gauge the developer’s intent in providing what was understood to be misleading information.

    So, I do still may have questions, etc., as to how many pounds of the “ton of public discourse on this development over a year ago,” the general public should consider as ‘appropriate.’ And in consideration of your response #215, (and I truly don’t mean this as a wise guy), but maybe at this late point in time, we all shouldn’t really be scouring for a red flag here or there.

    Finally, it was posted, “So, why do we need CARD?” Is the thinking that a successful CARD petition drive might just end up with the general public (in a sense) micro-managing the decisions of their duly elected Council members?


       —EJ    Jul. 14 '06 - 05:57AM    #
  217. if the $40 Mill proposal came up on a ballot, who would vote to approve it? as far as i know, that is the sole purpose of the petition drive.

    and of course it ‘slows down’ whatever project; for $40 Mill, i’d slow down too!

    and remember, $40 Mill here, $40 Mill there …. pretty soon you are talking about some (politicians’ dream) real money, eh?

    cheerrioz,toasty


       —toasty    Jul. 14 '06 - 07:06AM    #
  218. “Finally, it was posted, “So, why do we need CARD?” Is the thinking that a successful CARD petition drive might just end up with the general public (in a sense) micro-managing the decisions of their duly elected Council members?”

    I think “micro-managing” is not the thought. Micro-managing assumes knowledge and ability however the general public is ignorant and unqualified to decide how this project should or could be shaped to go forward (myself included). CARD’s tactic is to take the professional legs out from under the process as they see it heading for approval if left with council and their staff. CARD’s sole agenda is to stop the process; they get a second bite at the apple by appealing to the ‘wisdom’ of the general public with a referendum. CARD knows that if thrown to the rabble the public will reject it. Remember, read me lips…? It works every time. If CARD wanted to support, or even negotiate the terms with the developer and council, they would never have wanted to turn this into a public referendum.


       —abc    Jul. 14 '06 - 11:08AM    #
  219. CARD is a ballot question committee. Folks circulating the CARD petition have a wide variety of views on the project itself, on the brownfield process, and on the degree to which the City should ever subsidize private projects. All CARD wants is a public vote on the $40 million bond issue.

    Perhaps it would help if I post the text of the petition people are being asked to sign:

    “We, the undersigned qualified and registered electors, residents in the City of Ann Arbor, in the County of Washtenaw, and State of Michigan, respectfully petition for a referendum on the question of the issuance of General Obligation Capital Improvement Bonds, pursuant to Act 34, Public Acts ofMichigan, 2001, as amended, in one or more series in an aggregate principal amount not to exceed Forty Million Dollars ($40,000,000) for the purpose of paying the costs of certain improvements and activities related to the project commonly known as the Lower Town Brownfield Redevelopment Project, including the costs of constructing a multi-level motor vehicle parking structure and certain other infrastructure improvements and of performing environmental response activities.”


       —David Cahill    Jul. 14 '06 - 01:09PM    #
  220. ”...if thrown to the rabble the public will reject it.”

    Exactly. See toasty’s glib, drunken, three o’clock in the morning post for a good indication of what the typical voter is going to say when he or she first learns of this whole issue by reading CARD’s proposal on the ballot.

    Dustin and Hale, why frustrate yourselves by asking them what they’ll support? They’ll tell you, in due time, once they’ve stopped this project. And anyway, I told you back in post 53 what they’ll support. Just wait and see.

    Anyway, it is interesting to go back and see how this has evolved. Back on February 20th, way back in post 10, when CARD wasn’t even a glimmer in his eye, all Cahill cared about was that there wouldn’t be enough parking for the poor, sick patients coming to visit their doctors. It hadn’t occurred to him yet to be “outraged” by the “subsidy”.

    Hale’s right. Cahill is focus-grouping his obstruction here, perfecting his nefarious schemes, using your time and talents against you. And every time someone gets wise, like Todd, and begins to ignore him, some other poor chump begins taking the bait.

    Listen, Cahill is bad news. Engage him at your peril.


       —Parking Structure Dude!    Jul. 14 '06 - 01:43PM    #
  221. Please David. We’re not a bunch of morons here. Of course, the petition is “only” about the bonds. That’s all it could be about legally. Short of going to court, there is no other legal way to block the development going foward. But as you’ve already demonstrated through your comments here, this really isn’t about the $40 million. It’s about blocking this project and sending a message that you alone will decide what goes into that location.


       —John Q.    Jul. 14 '06 - 01:47PM    #
  222. Again, I’ve mostly stayed out of this one, but surely the brownfield cleanup is not the only “core concern” here. The other core concern is the fact that this is a giant comercial lot in a nice neighborhood which has been producing zero benefit for anyone for several years now (unless you like to look at and/or live next door to old abandoned parking lots).


       —Young Urban Amateur    Jul. 14 '06 - 02:52PM    #
  223. All CARD as a group wants is a vote on the subsidy. Too bad some people are having difficulty focusing on this simple point.


       —David Cahill    Jul. 14 '06 - 05:50PM    #
  224. “All CARD as a group wants is a vote on the subsidy. Too bad some people are having difficulty focusing on this simple point.”

    You don’t want to have a vote. You want to be able to vote no to stop everything. As I already pointed out, If CARD wanted to support, or even negotiate the terms, with the developer and council you would not have chosen a public referendum as the tactic.

    A referendum is not a negotiating tool. Once it is started you can only vote on the motion, up or down. All of the discussion above about adjusting the process or the project becomes meaningless. Its sole purpose is to be able to say no to a process that without the referendum seemed to be saying yes.


       —abc    Jul. 14 '06 - 08:02PM    #
  225. “Dustin and Hale, why frustrate yourselves by asking them what they’ll support? They’ll tell you, in due time, once they’ve stopped this project. And anyway, I told you back in post 53 what they’ll support. Just wait and see.”

    Point taken. However, my past zen readings notwithstanding, I still have difficulty embracing the concept of nothingness—that lower Broadway void in CARD’s future vision. To make do with a proxy that my limited mind can grasp, I’ll envision CARD from here on as a benevolent non-profit subsidiary of Walgreen’s. While it may seem inappropriate to imply without any evidence that a corporation underwrites the petition drive, I’m looking ahead to the campaign’s likely implications if successful, rather than guessing on the group’s motivations and stubborn refusal to state a land use vision. If it should turn out instead that CARD’s success does in the end lead to a Greenway Northeast, Walgreen’s can quietly morph into Wall of Green (barring, of course, the location becoming a permanent zen rock garden—which would save on park maintenance costs). The satellite Greenway NE might connect with the main downtown branch via The Link, though on this route the purple exterior of the bus should add a more correct hue for the occasion.

    By the way, I’m certainly not opposed to having park space as a part of the BV project, nor care much one way or the other if Walgreen’s shows up somewhere on that site, maybe next door to Applebee’s. And if a petition supporter wishes to take the risk of expressing an actual vision for what they think would be neat to see on the BV site, feel free; at this point, any concrete response at all would hugely exceed expectations.

    – - – - – - – - – - – - – - – - – - – - – - – - – - – -

    “All CARD as a group wants is a vote on the subsidy. Too bad some people are having difficulty focusing on this simple point.”

    To all members of Arbor Update’s CARD focus group:
    You have your marching orders! Get on the new topic! Begin writing now!

    (Looks like someone has. I thought I would be #224.)
    In that case, well…. Rejecting all good sense, I’ll go ahead and nibble at the bait, too:

    “All MCRI as a group wants is a vote on the….”


       —hale    Jul. 14 '06 - 08:12PM    #
  226. Yesterday the local chapter of the Sierra Club took a position on the petition drive.

    It said that cutting the general fund parks budget 25% at the same time as giving $40 million to the developer is wrong. The club favors a public vote on the bond issue.


       —David Cahill    Jul. 14 '06 - 08:16PM    #
  227. There are probably at least a few voters in this city who might personally take issue with abc’s statement (#218) that, “the general public is ignorant and unqualified to decide how this project should or could be shaped to go forward.” I’m pretty sure abc would never declare that the current City Council making this decision for us was elected by the “ignorant and unqualified.”

    Nonetheless, I do understand the gist of the point abc is making.

    Along these lines, though, should anyone really be that systematically faulted for at least trying to explain the issues to the “ignorant and unqualified” amongst us? In a sense, I think those pursuing this can at least be applauded if their efforts end up encouraging the public to always remain an integral part of the process. I doubt that I will hear even a single argument to the contrary that we all lead very busy lives.


       —EJ    Jul. 14 '06 - 08:31PM    #
  228. See? Now the local Sierra Club’s involved. Anybody want to start placing bets on how many days (hours) until someone says, all ingenuously, “You know, it could be a park.” And how many days after that until the party line is that it was ALWAYS going to be a park and now the evil developers are trying to swoop in at the last minute and spoil everything.

    And guess what? Broadway Village actually includes a small park, and a plaza area, but not the “full scale” greenway that had been promised.

    And the really sickeing part is that it will work.


       —Parking Structure Dude!    Jul. 14 '06 - 08:55PM    #
  229. Wait—so this whole thing is an attempt to get a park put in the space? For crying out loud, why don’t people just come out and say these things!

    For all I know, a park there would be perfectly fine—but it would be nice to know ahead of time what I’m working with.

    Come to think of it, who the heck is going to pay for the park land…


       —Young Urban Amateur    Jul. 14 '06 - 09:05PM    #
  230. I’m just saying that the precedent has been set.

    And if Cowherd’s involved, there’s a park lurking in the wings.


       —Parking Structure Dude!    Jul. 14 '06 - 09:17PM    #
  231. Okay, sure. Why not. Let’s see if we can get a park added. Maybe even, say, a little chunk of greenway along Traver Creek, which runs along the north edge of the site. Wouldn’t that be nice? I mean, it wouldn’t be much, since there’s only a little piece of creek, but it would start to build a connection from Broadway Park, just across the road, towards the river.

    Hey, wait a minute. This is starting to sound awfully familiar. I wonder. Let’s see – if we go to the BV project website , hmmm, yep, here’s a site plan , and – well, gosh. That’s exactly what’s proposed.

    Hey, I wonder if that’s part of the “public benefit” we’re considering in the TIF financing – rehabilitating the creek’s floodplain and providing a segment of linkage between parks. Could be.

    (This has just become way too easy…)


       —Murph    Jul. 14 '06 - 09:23PM    #
  232. “See? Now the local Sierra Club’s involved. Anybody want to start placing bets on how many days (hours) until someone says, all ingenuously, “You know, it could be a park.””

    You’re three-and-a-half years late, actually—the site seems to be gone now, but someone once posted a joke plan with a park.

    The argument was basically: the developer is proposing heights we consider “extreme”, so we’re going to propose something that’s also “extreme”, and then obviously the right solution will be the in the middle (half the height).

    Yep, fight for a solution that will support half the use on the same amount of land, and then congratulate yourself on how green you are….


       —Bruce Fields    Jul. 14 '06 - 09:31PM    #
  233. But that was a joke, Bruce.

    This time it will be for real.


       —Parking Structure Dude!    Jul. 15 '06 - 03:50AM    #
  234. That little bit of green next to Traver Creek reminds me of the little bit of green next to the DDA’s proposed parking structure at First and William which they dared to call a “greenway”.

    Can anyone use “greenwash” in a sentence? 8-)


       —David Cahill    Jul. 15 '06 - 05:59PM    #
  235. “That little bit of green next to Traver Creek reminds me of the little bit of green next to the DDA’s proposed parking structure at First and William which they dared to call a ‘greenway’.”

    Is this an issue?


       —hale    Jul. 15 '06 - 06:05PM    #
  236. I good friend ran into CARD at the Farmer’s market. Laura Strowe and a second woman were circulating their petition.

    The second woman did most of the talking. She politely yet forcefully explained what the petition was all about. She did not use the word gift once, substituting the word loan (which isn’t quite accurate, but why split hairs). When asked a few questions that she couldn’t answer, the second woman said “I don’t know about that, let me ask”, and then went over to Ms. Strowe for clarification.

    The two points that both women repeated on several occasions was that they wanted to give voters a chance to say no to the bond issue, and that there was “no guarantee that the bond money would be paid back in full”....which, of course, is entirely true. Risk can only be kept to a minimum. It cannot be eliminated.

    I just wanted to let Arbor Update know that CARD has clearly changed their tactics.

    A big, big thanks to Laura Strowe and the second CARD volunteer for being honest, and not distorting the facts surrounding the bond issue.

    I may not like their underlying motives, but I sincerely appreciate the change in their m.o. Good luck to them.


       —todd    Jul. 15 '06 - 06:11PM    #
  237. When trying to translate “tax increment financing” into non-technical terminology, it sounds like “investment” might fit a bit better than “loan” or “gift.” The city puts up a bunch of money in the hopes of increasing the tax base. If successful, the city gets enough tax money to profit from its investment.

    There’s one really obvious difference I can see between the TIF and a loan that I haven’t seen raised here. If it were a loan that the developer agreed to pay back, the money would presumably go away if the developer went bankrupt. If it’s instead to be paid back through property taxes, the city can collect from whoever ends up owning the complex.


       —scg    Jul. 22 '06 - 06:20PM    #
  238. A good point scg. Someone will always own the project, the developer or in the worst case, the creditors so someone has to pay the taxes and thus the TIF. It also seems that the city would act like a bank and only dole out the funds as the project is built and the value is increased. With the 75% pre-leasing requirement they have very little to worry about but just in case, there is a back up plan as above. Someone will always pay the taxes.


       —Dustin    Jul. 23 '06 - 03:54AM    #
  239. I wish the process worked that way. Unfortunately, the bondholders are “first in line” for all the taxes that come from this project – for 30 years. Neither the City nor any other governmental units will get any taxes from the project.

    If the project doesn’t attract tenants who can pay the rents necessary to make the project worth enough in taxes, then the City will have to make up the difference. With the “full faith and credit” bonds, the City will be legally obligated to raise taxes on everyone to pay the bondholders if the taxes from the project are bit sufficient.


       —David Cahill    Jul. 23 '06 - 02:16PM    #
  240. So, say the city sells $20 million in bonds to back the project? Just how do they lose money when it is 75% pre-leased and the city is busy checking the financial underpinings of the tenants? And, one question you have never answered: if not this development, what other would you like to see, is it one that would clean up the pollution and make this an active site again? A Walmart perhaps? A new strip mall? FYI, the school taxes would not be captured.


       —Dustin    Jul. 23 '06 - 03:00PM    #
  241. No, the city sells $40 million in bonds. With interest over 30 years, the project would have to generate at least $80 million, and perhaps over $90 million, in taxes to repay the bonds.

    The “prospective appraisals” done in 2003 and 2004 said that the project would not generate anywhere near that amount in taxes – even if the project is rented completely, which no one can guarantee.

    That is one problem with the project: risk to the City if the project is not a financial success.

    The other, more fundamental problem: the City is subsidizing private development with the bond issue.


       —David Cahill    Jul. 23 '06 - 07:36PM    #
  242. Oop! In #239 above, last line, “bit sufficient” should be “not sufficient”.

    Also, school taxes would be captured.

    Finally, what would I want personally? Something that doesn’t require a huge subsidy. But the developer owns the land, not me.


       —David Cahill    Jul. 23 '06 - 07:39PM    #
  243. Many of the council members and the mayor have gone on the record saying they will only support the bond sale if the financial data warrants it. If as you say, the project will not generate enough taxes to make the bond payments, why are you so convinced that the city council would agree to sell more $$ worth of bonds than the project can support? Please don’t say it is because they voted to start the notice period, it makes a lot of sense to investigate the financial data and allow the required time to lapse at the same time. Are the council members just stupid?


       —Dustin    Jul. 24 '06 - 01:44AM    #
  244. Because they have ignored the two prior prospective appraisals showing that the taxes will be insufficient.

    Also, in August, 2004, Council rejected an amendment to the development agreement, offered by Groome and Johnson, which would have required an independent appraisal and a certification that the taxes would be sufficient to pay off the bonds.


       —David Cahill    Jul. 24 '06 - 01:50AM    #
  245. So you think they are stupid?


       —Dustin    Jul. 24 '06 - 02:26AM    #
  246. One more question. Have you considered in all of this that of course the buildings will not appraise for much unless they are rented? Given that they are not even built yet and back when those prospective appraisals were done, they were not even leased it makes sense that the appraisals were low. Empty commercial buildings are worth much less than full ones.


       —Dustin    Jul. 24 '06 - 02:30AM    #
  247. Er, Dustin, the appraisals were done on the assumption that the buildings were fully rented at AA market rates. 8-)


       —David Cahill    Jul. 24 '06 - 12:30PM    #
  248. It seems settled then. The mayor and several council members have said that unless the numbers work out they won’t be voting for this. If the value of the develpment is not high enough to support the bond sale then you are off the hook, no develpment in your neighborhood. Or, at least not this development, unless the developer goes on without the city or with a limited city loan. This thing may well die on its own. And you can take it easy until the next one comes along, a Walmart perhaps? Or, the UM may want to build those big parking structures there. Good luck!


       —Dustin    Jul. 24 '06 - 05:21PM    #
  249. Thanks, Dustin!


       —David Cahill    Jul. 24 '06 - 05:32PM    #
  250. Below are the minutes from the Broadway Village Team Meeting of June 30 as provided by David Cahill. These are most likely the last of the minutes as the team is no longer meeting weekly.

    BV Meeting Minutes 6/30/06

    The City’s web site on Broadway Village is now available here.


       —Juliew    Jul. 27 '06 - 07:49PM    #
  251. I read the minutes and the summary; they seem, essentially, to directly contradict the most important talking points DH is floating here. I’m also astounded at the amount of wiggle room there is in the bond, if anyone tried to work it that way. Making the parking structure public and available at a cost, for example; perhaps under the rubric of the city, like the structures in the center of town. It wouldn’t be that hard a deal to work out. It’s an easy chip for the developers to give up; they weren’t going to generate any revenue from the structure anyway. Of course CARD hasn’t even considered it as a possibility. All they want to do is kill it.

    I also note that the people who seem to be most directly benefitting from this model are low and median income folks. Health care providers and shops on a major bus line plus lower-income housing. The greatest loss—and really, when I look at the plan, it’s a trivial loss indeed—would come from the wealthiest parts of what is a very wealthy part of town.

    Maybe the elephant in the closet here is the poor(ish) rabble. After, 80% of the median income in this town is not exactly impoverished. Is CARD opposed to Ann Arbor creating spaces for less affluent Michiganders? Maybe David can create a talking point addressing that.


       —schlomoseamus    Jul. 28 '06 - 12:08AM    #
  252. David – areyou saying the people building Broadway Village don’t owe the City any money at all in exchange for getting forty million dollars? Just that their normal taxes get captured and sent to the bondholders? That seems hard to believe.

    And what would cause government to borrow money to help build a project that doesn’t produce money for them – not the bondholders? I’d expect government to care quite a bit about short term financial benefits, as they are having a tough time financially. No government leader is going to be around to reap benefits after the bonds are paid off. Most won’t even be around in five years if the usual turnover occurs. They’ve got to be thinking of some kind of short term gain. Can someone comment on what it might be?

    Is the project really loaded with real low-income housing like comment 251 says? I never heard it described like that.


       —AK    Jul. 29 '06 - 02:39AM    #
  253. Seems like there is a fair amount of “work force housing.” Aside from the fact council members and the mayor have said repeatedly that unless the finance team working on this can show that the numbers are solid in the city’s favor, they won’t sell any bonds or maybe only up to an amount that the project can support. Plus the city would get the $500 K every year above what the TIF brings in. That may be the short term gain. But remember, if there is no project, there will be no TIF to collect and no $500 K, no economic boost from a new project, and no redevelopment of a dead site that has just sat there for years. The pollution would continue its migration to the river.


       —Dustin    Jul. 29 '06 - 03:58AM    #
  254. Dustin, how much “work force housing” is there in the project? Can you say what qualifies it as “affordable”?

    In your final sentence, are you saying you don’t think the site is developable without a major government role?

    Not selling more bonds than the development can support seems like a good step. But what’s the big deal about not allowing the public to vote on this? Isn’t this the right way to go about using big amounts of public funds? Don’t things like roads and parks, new schools and green-belts get put before the voters for approval? Why not the bonds?


       —AK    Jul. 29 '06 - 07:00AM    #
  255. “But what’s the big deal about not allowing the public to vote on this? Isn’t this the right way to go about using big amounts of public funds? ”

    Is it? The City spends close to $300 million dollars a year on all city activities. But you don’t vote on those expenditures every year because you have representatives on Council that you elect who decide each year how that money is spent. Why? Because we elect them to spend the money wisely with the belief that they’ll spend the time to be well-informed about the choices they are making. I’ll always support public input and even public involvement in the decision making process. But on issues like this, having the public decides doesn’t mean it’s “the right way” to do things. If the public were to approve the bonds, does that mean that Cahill and all of the critics of this project will go away since it has public approval?


       —John Q.    Jul. 29 '06 - 02:15PM    #
  256. I think I understand the feelings motivating your last sentence, John Q, but this isn’t about the critics in that sense.

    Then again, maybe you’re alluding to the sense in which it is about them with regard to our government. Will we move in a direction of improving our local representative democracy, or will small groups use the tools of democracy to distort it? I don’t see how calling for a vote of citizens on a complicated issue is a positive step when voter turnout is currently dismally low. Far more people will have voted for our current representatives (cumulatively, over multiple elections) than will vote on a bond proposal. Sorry, the rejection of a bond proposal. Or … nevermind. Anyway, I’m sure the Ann Arbor News editorial board will inform us on the proper vote. After all, that’s the role of the ‘free press’ in a democracy, right?

    I think that a better approach (maybe the best, given the current reality of our democracy) would be for opponents of the project, whether on its face or its financing, to address council at their open, frequent, publicly broadcast (and replayed) meetings and make their case before the whole city, not just those who visit the farmers’ market or live in the Lowertown area. They can bring petitions to council if they like, asking them to stop the project based on those financial concerns (if they are indeed demonstrated to be unfavorable to the city’s future.)

    In addition, half of council and the mayor’s seat is up for election. They can ask candidates to take a position on it. Instead, they’ve asked them (some, anyway) to take positions on the referendum. (Now why would a voter who doesn’t trust council to act responsibly on their behalf want to know their opinion? I can guess the rationale, but I don’t think it’s sound.)

    Is it their right to take this approach? Yes. Does it build community and improve democracy—or even increase the likelihood of a better development on the site? I don’t think so.


       —Steve Bean    Jul. 29 '06 - 04:12PM    #
  257. AK: There are brownfield sites sitting idle across the state. Seems odd to have one sitting there for so many years even in a town like A2. This is why the state brownfield program was put in place, to redevop brownfields in cities and save spaces in the townships. There is no reason to believe the site will ever be developed without a major government role. Especially if you want to stop the pollution from reaching the river. There is no money to do this without the development. The property has been sitting there, polluted, for what, 8-10 years? Seems like somebody would have done something with it before now if it was viable. Much easier to go out in the township, no pollution, many fewer hassles to deal with, cheaper land and just build all over the landscape. I know its hard to understand but there is NO MONEY TO LOAN without the development, the funds have yet to be created because there is no development. People need to have a better understanding of TIF financing if they are going to discuss this. Could the voters ever be expected to understand it in mass? Murph gave a good explanation of TIF several posts ago. Again, the city could not “give” the developer money even if they wanted to because there is no money to “give.”
    I remember something like 30 to 36 units of affordable rental housing.


       —Dustin    Jul. 29 '06 - 05:19PM    #
  258. Here is an excerpt from an article in today’s AA News:

    Last week, Warren supporters entered the fray, questioning whether Greden improperly blended his occupation as an attorney with his role on the council at a February meeting with city and county officials over the Broadway Village development.

    Greden works for a firm representing the project developers and has recused himself from council discussions and votes on the initiative. But he admits asking County Drain Commissioner Janis Bobrin, whom he knows personally, for a meeting on behalf of his clients to get a better understanding of flood-plain issues concerning the project.

    The meeting occurred at Bobrin’s office and included city staff whom neither Greden nor Bobrin remember inviting. Bobrin said Greden’s role in the meeting was limited and that he made no requests or decisions that could pose a conflict.

    “It was a routine informational meeting and business as usual for this department as far as I’m concerned,’’ Bobrin said, adding that she had received multiple calls on the topic from residents last week. “I’m surprised at the level of concern and flurry of interest in all this.’’

    But Warren supporter Tom Wieder, a foe of Greden, said the mere presence of a council member at an official meeting with clients who have business before that same elected body isn’t ethical.

    “He goes to public meetings and recuses himself from voting and discussions, but then goes behind the scenes to set up a meeting and discuss it?’’ Wieder asked. “You don’t have to be a particularly suspicious person to see why he was there. It’s because of who he was.’’

    Greden said his political status was not an issue.

    “Just because I’m at a meeting with the county attended by city employees doesn’t mean there’s a conflict of interest,’’ said Greden, who also accused Wieder and others of trying to create a campaign issue where none exists.


       —David Cahill    Jul. 30 '06 - 12:40PM    #
  259. Wow, this makes both you and Warren look dirty, David.


       —Dale    Jul. 30 '06 - 04:21PM    #
  260. I had planned to vote for Warren in the primary, but now feel compelled to consider abstaining. Greden’s corporate lawyering, combined with his pandering to the ‘Old Fourth Ward’ and manipulative push of the ‘porch couch ban,’ made him compare rather unfavorably with Warren. Now Warren, facing a potentially close primary vote on the horizon, shows she won’t hesitate to try petty mudslinging in order to gain an edge, rather than sticking to issues where she contrasts with Greden. Apparently Warren is willing to play any “card” available. Quite disappointing to see her make an appeal to “secret meetings” paranoia. In terms of misbehavior, Greden’s involvement in the meeting at Bobrin’s office is pretty damn low on the totem pole.
    —————————————————————————
    In response to Dustin and to others further above, I want to remind again how CARD’s arrival on the scene has largely sidelined a much more rational discussion of “how we can make the [Broadway Village] project better.” CARD, so far, has effectively framed an all-or-nothing argument: we either passively agree to $40 million in TIF financing for what Strathmore has on the table, no questions asked, or we stick with the current rock garden on lower Broadway. CARD argues passionately for keeping the rock garden. It is essential to their success to pretend that no political possibilities exist in between. This is the same tactical strategy that the downtown greenway advocates use: you either favor 100% greenway everywhere, or else you are a willing tool of evil developers. On the federal level, you see exactly the same style of spin in Bush’s “you’re either with us or against us” approach to foreign policy and domestic security.

    I bring this up now because the quality of discussion in recents posts here has generally improved. Still, due probably to CARD’s very real threat to the its survival, there’s a tendency to unquestioning defend the project as it stands. In contrast, I think it is reasonable for a rube like me to wonder out loud if $40 million in TIF financing is too much and if $15-20 million might be more appropriate, or if it is still possible at this late stage for the city to leverage a higher percentage of affordable housing (how about 50% rather than just a meager 20?). Or we can discuss how well the BV design will work in the long run. While these thoughts may just reflect a few concerns on my agenda, look back to the first 14 posts on this thread (pre-CARD) and you’ll see a very different kind of discussion going on.


       —hale    Jul. 30 '06 - 05:08PM    #
  261. Hale wrote: ”... I think it is reasonable for a rube like me to wonder out loud if $40 million in TIF financing is too much and if $15-20 million might be more appropriate …)”

    Well, Crawford’s not exactly a rube, and when asked point blank, here’s what he said:

    HD: So is one of the possibilities that the City will just not issue 40 million dollars worth of bonds, that it might be 30 million instead?

    TC: Oh, absolutely. We could issue none. We could issue 25, 30.

    For more go here


       —HD    Jul. 30 '06 - 05:40PM    #
  262. Well, Dale, I didn’t write the AA News article, or even contribute to it. I posted it because it had to do with Broadway Village.

    I had no idea Greden had been retained by the developer, and I’ve been following the project for several years. Amazing.


       —Dave Cahill    Jul. 30 '06 - 07:29PM    #
  263. David—did Warren come up with this idea to win over undecided CARD-types, or did CARD help devise this attack?


       —Dale    Jul. 30 '06 - 07:37PM    #
  264. Wait, David—an honest, factual question here. Leigh Greden has recused himself from Council discussions and votes regarding Broadway Village because he works with the firm and you didn’t know about it? Are you serious?


       —Dale    Jul. 30 '06 - 07:41PM    #
  265. Dave Cahill wrote: “I posted it because it had to do with Broadway Village.”

    Perhaps Dale’s previous jibe alludes to the fact that the meeting described in Aisner’s regular Political Notebook column probably has less to do with Broadway Village than with the unfortunate sniping back and forth between folks in the Greden and Warren camps in a contest that has them basically in agreement on all the relevant issues and very little of any substance to differentiate one candidate from the other.

    That context, in any case, is the one in which Aisner’s excerpted piece , um, ... couches this incident. Readers will need to persevere past the page jump in the physical paper and to the second screen on the MLive version to get to the excerpted part.

    And if it does have substantively to do with Broadway Village, doesn’t it require us to accept as a premise that Leigh Greden is able to influence how Broadway Village shakes out despite not particpating in Council votes or discussion? Is Leigh really that skilled a politician?


       —HD    Jul. 30 '06 - 08:18PM    #
  266. I’m curious whether anyone else saw, in Saturday’s News, the small announcement that Strathmore (the outfit trying to develop Broadway Village) has just donated $100,000 to Mott—half for pediatric bone marrow research and half for the new hospital building.

    And I’m really dying to hear how the conspiracy theorists are going to spin it. Will it be:

    “Strathmore tries to buy the allegiance of influential pediatric oncologists!”

    or

    “Strathmore pleads poverty while giving away wheelbarrows of money to sniveling brats!”

    or maybe

    “Pregnant women and children being cynically used for public relations as Strathmore awaits city decision about giant handout!”

    The only thing you can be sure you won’t hear is any suggestion that the evil developer might just be trying to be a good neighbor. No good deed goes unpunished, right Dave?


       —Parking Structure Dude!    Jul. 30 '06 - 09:10PM    #
  267. No, Dale, I really didn’t know Greden had been involved at all. The only recent Council vote on the project was on June 5. Nothing in the AA News coverage of the meeting mentioned that he had disqualified himself.

    The problem here, working from the AA News’ statement of facts, is that Greden set up a meeting with City and County staff in his capacity as an attorney for the developer. While he disqualified himself from discussing/voting on June 5 on the floor of Council, he nonetheless was working behind the scenes on behalf of a client.

    Greden had two duties: The duty to his client as an attorney, and the duty to the public as a Council member. The two duties are in conflict.


       —Dave Cahill    Jul. 30 '06 - 10:27PM    #
  268. David-

    When Greden set up a routine meeting with a County official so the developer could get basic info, his duties were not in conflict. Doesn’t matter if City people were also there. His duties are only in conflict if he votes or takes other decision-making action involving his client.

    Stop trying to make up an issue. These conspiracy theories are getting old. Go take some meds to treat your paranoia, and move on.


       —PJ    Jul. 30 '06 - 11:49PM    #
  269. The fact that the AA News thinks it’s news makes this issue important. While I should feel flattered that you think I made Greden’s actions an issue, I didn’t. 8-)

    This is “breaking news”, so we must wait and see what effect (if any) it will have on the project.


       —Dave Cahill    Jul. 31 '06 - 01:04PM    #
  270. Dave Cahill wrote: “The fact that the AA News thinks it’s news makes this issue important.”

    ”... you think I made Greden’s actions an issue, I didn’t.”

    And the A2 News didn’t make them an issue, either. Art Aisner’s news judgement along with his editors was apparently that the trading of petty potshots between Greden and Warren’s respective camps was worth noting in his Political Notebook column.

    So in terms of importance, it would seem that the A2 News judged Greden’s meeting to be about as important as whether Warren’s MARAL literature was misleading in leaving Greden off their list of candidates they endorsed as ‘pro-choice’. It’s petty potshots from each side and nothing more.

    What’s interesting to me is that Dave Cahill has claimed that Greden has a potential conflict of interest … and Greden agreees with him! That’s why he has recused himself from Council discussions and voting on issues related to Broadway Village (which is apparent to anyone who attends council meetings or watches them on CTN from the fact that he says, ‘Mr. Mayor, I have to recuse myself from this discussion’ and then leaves the chambers.)

    What, then, is the problem in Leigh continuing to act in the best interests of his client? Is he required ethically to stop working on behalf of his client? Do the guidelines of the Michigan Bar proscribe that sort of client advocacy? I have no idea what the ethical requirements of the legal profession might be, so if there’s a reason to cry foul from that point of view, then let’s hear it.

    What Leigh is dealing with is what I think we would like Council Members to have to deal with at least occasionally: a conflict of interest between their general duties to the public and their duties to some smaller part of the community (and, yes, developers are a part of our community). Why is that? It’s because ideally I think we want folks on Council who actively live and work in our community and who are involved our community to a degree that there are at least potentially some matters that might conceivably come before Council that would create a conflict of interest.

    From the facts reported in the A2 News, Leigh performed the kind of task that would normally be assigned to a scheduling secretary and then attended the meeting. If Leigh used his influence as a Councilmember to arrange a meeting that would not otherwise have happened were it not for the fact that Leigh is on Council, and that as a result, Strathmore was afforded some advantage compared to some other developer who’s trying to develop the property, that would be an entirely different story. But that’s not the story that ran in the A2 News.


       —HD    Jul. 31 '06 - 02:24PM    #
  271. “I posted it because it had to do with Broadway Village.”

    David, in the future, please post the link to the article so we can easily access and read the whole thing, rather than just your chosen exerpt. Unless, of course, you think the excerpt is particularly relevant, and then please explain why in your post. In this case, the article seems to have nothing significant to do with Broadway Village.

    “Here is an excerpt from an article in today’s AA News:”

    It’s also exceptable to refer to articles in yesterday’s newspaper. Give yourself a day to ponder it before discussing it here. If it contains a real issue it won’t go away in a day.


       —Steve Bean    Jul. 31 '06 - 05:23PM    #
  272. Well, Steve, if you think the AA News article has nothing significant to do with Broadway Village, then you are visually (and politically) impaired.

    With regard to Strathmore’s donation to Mott, reported in Saturday’s AA News, I think a better headline would read:

    “Strathmore donates to Mott to finalize deal with prospective medical office tenants.”


       —David Cahill    Jul. 31 '06 - 07:53PM    #
  273. “This is ‘breaking news’, so we must wait and see what effect (if any) it will have on the project.”

    Indeed. In the meantime, feel free to shed some light for us vision-impaired folks. (HD apparently shares my condition.)


       —Steve Bean    Jul. 31 '06 - 08:27PM    #
  274. For crying out loud….now you’re calling out a huge donation to a children’s hospital?

    Dave, you’re better than this. Come on.


       —todd    Aug. 1 '06 - 01:10AM    #
  275. What everybody seems to be forgetting in the debate over whether the property taxes would pay back the bonds is that if banks were to finance the whole project, then the owner of the completed project would have to pay the banks their principal and interest AND pay the city property taxes. The whole point to more development from the city’s viewpoint is to increase tax revenues from the now more-valuable property. If the property taxes are now going to bondholders, most likely to be investment banks and mutual funds, they are not there to be spent on city services. The “extra” $36M in bonds would be a gift to the developer, saving all the interest that a true entrepreneur would have paid to commercial backers. All that is assuming that the project is able to pay its taxes and its bankers, which is not guaranteed. If the developers were staking their personal fortunes on this one I would have a little more faith, but I suspect they will be paying themselves a good salary out of the funds available and doing the accounting so that they can’t lose.


       —Hunter Van Valkenburgh    Aug. 1 '06 - 09:18AM    #
  276. HVV: If this were a fine, unpolluted, un-blighted site then the logic of letting the market forces decide what is going to happen makes sense. But this is a polluted, blighted site that has been sitting there for 10 years while the stream of polution creeps toward the creek and the river. If the market forces were going to work on this site they would have by now. Seems like this is exactly the type of site the state brownfield plan was put together for, to spur development of polluted, dead, in-the-city sites ahead of “greenfield” areas in farm fields. City officals have said repeatedly that unless it can be proven that it will benefit the city financially, no deal on the bonds. Of course the developers will make a profit, why else would they do it? The question really is: Would you rather it stayed the same for another 10 years?


       —Dustin    Aug. 1 '06 - 11:59AM    #
  277. For the purposes of discussion, let’s assume that this project isn’t financially able to cover the costs of City-issued bonds to pay for the pollution clean-up, infrastructure and parking garage. So what project can financially succeed here? Wouldn’t we expect someone to come back with a proposal that’s even more dense, requesting greater height and even more intense uses that will generate the revenue to cover the costs inherent in the site? At least the City has some say in this project with the leverage of the bonds. But if we insist that a developer go it alone, aren’t they going to come back with something even less to David C.’s liking with the argument that “we have to build this high and this dense to get the financing to make this work”?


       —John Q.    Aug. 1 '06 - 03:15PM    #
  278. I’ve been lurking for quite some time- following this discussion on TIF. Finally, Dustin and John Q have combined to make the logical argument necessary to quiet David Cahill’s puerile squawking:

    1.This is not a “bankable” deal. If it were, it would have (a) likely already happened in the past decade and (b) there would be no worries that the bonds are risky. Therefore, any assertion that the use of TIF financing in this case is “corporate welfare” is off base. It is extremely unlikely that a project on this site will go ahead without TIF and various targeted development credits.

    2.The use of TIF is indeed a benefit to the developer. No one should argue that. It provides the “cheaper money” required to allow for a target profit margin acceptable to the developer’s equity holders.

    3.Is there a cost to the city (us) for providing this “cheaper money?” Certainly. Is it $40mm as Mr. Cahill would have us believe? Of course not. The cost to the city is three-fold:

    a.Short-term foregone tax capture – only a real cost if another development would have occurred without the bonds, which seems unlikely- AND if the long-term revenue generated plus the increased revenue from the surrounding areas (which will begin to go up promptly) doesn’t offset this loss – again very difficult to argue counterfactuals, but logical to assume that it would.

    b.Increased burden on other city services- a real and largely unavoidable cost but difficult to quantify- and no where in the realm of $40mm

    c.The risk of the city’s credit rating to back the bonds- obviously only a problem (albeit a serious one) if the city has to default on the bonds. The city council has assured everyone involved that if the numbers don’t work out, it won’t do the deal. So either, they’re lying, or this will likely be a non-issue. Is there some risk, even with professionals auditing the deal? Of course. Then again, there’s risk when you get out of bed in the morning or cross the street. The risk in this case (as in crossing the street) is an acceptable level for the rewards sought.

    4.Ok, the developer is getting a profit from this deal and the city is paying some (likely minimal) costs (see above). What do we get for our money? Well, we get some urban blight cleaned up, we get some significant environmental considerations, and we get reasonable development close to downtown as opposed to continuing sprawl. As anyone who has ever left academia would know: there ain’t no such thing as a free lunch. We get some benefits, we pay a little price (maybe). Does the developer make money? Yes. Doesn’t the city pay for other services? Don’t those service providers make money? Is it a “gift” when we pay for independent auditing or garbage removal, etc…? The only real question is: in this case, do the benefits outweigh the costs? And it seems pretty clear that given the small level of costs (additional burden on city services) and the large degree of benefit, it’s an easy decision to make.

    If it makes you feel better, David, call TIF a “payment for services” and stop hollering about it being a $40mm cost. You simply make yourself, and Ann Arborites by association, sound backward and ignorant.


       —DCED    Aug. 1 '06 - 04:58PM    #
  279. Warning! Don’t read this if you (1) love Broadway Village, (2) love subsidized developments, and/or (3) think politics is dirty. Proceed at your own risk.

    OK, you have been warned.

    About an hour and a half ago I got the following news release from a PAC that was formed about a month ago called Progressives of Washtenaw (POW!). I presume it was widely distributed – after all, I got a copy of it – and that all the regular news media have it. Since Arbor Update prides itself on scooping the regular media, and since we provide “the first draft of history” for Ann Arbor, here it is.

    FOR IMMEDIATE RELEASE:

    POW!

    Progressives of Washtenaw

    Contact: Dave DeVarti, Spokesperson
    Organization Name: Progressives of Washtenaw
    Telephone Number: 734/995-2850
    Email Address: Progressives@comcast.net
    Web site address: http://progressivesofwashtenaw.org

    Leigh Greden’s Ethical Problem

    August 1, 2006

    State Representative candidate Leigh Greden has a serious problem with ethics which should disqualify him from receiving the votes of Democratic primary voters. At best, he has engaged in a serious conflict of interest. At worst, he is guilty of deliberate influence-peddling. At the core is the massive Broadway Village project being developed in the “Lowertown” area of Ann Arbor. Greden has exploited his status as an Ann Arbor City Councilman to assist the developer of the project and has taken a large amount of campaign funds from a dozen people with interests in the project.

    Broadway Village needs numerous approvals from the Ann Arbor City Council, of which Greden is a member. The most important of these is the issuance of $40 million dollars in city-backed bonds. The developer of Broadway Village is represented by Miller Canfield, the large corporate law firm for which Greden works. Given these facts, Greden should have nothing whatsoever to do with that project. Unfortunately, that has not been the case.

    Around February 1st of this year, Greden called Washtenaw County Drain Commissioner Janis Bobrin, asking to set up a meeting for, in his words, “his client,” Strathmore Development Co., the Broadway Village developer, to discuss flood-plain issues regarding the project.

    The meeting took place on February 7, 2006 and included Greden, two representatives of Strathmore, Commissioner Bobrin, Bobrin’s deputy and two City of Ann Arbor employees. Though Greden’s client received no special treatment, his mere presence at such a meeting represents a conflict of interest.

    That Greden should have been involved in this matter at all is suspect. Greden works in the Labor and Employment section of Miller Canfield and, according to its website, “advises employers regarding labor and employment policies and practices.” He does not do real estate work and has no known expertise in flood-plain issues. The only reasonable conclusion is that Greden, his client, and/or his bosses at Miller Canfield sought to exploit his status and contacts as a public official.

    When first asked about this meeting by a reporter from The Ann Arbor News, Greden denied that he asked for it to be set up. He said that he merely “attended” the meeting as “a member of Council,” as if that would be okay. When it became apparent that his story would be contradicted, he told a second reporter that he had asked for the meeting to be set up at the request of “his client.” If it was okay for Greden to act as an attorney for Strathmore in setting up the meeting with the Drain Commissioner, why did he first lie about it to The News?

    Publicly, Greden has acknowledged the conflict of interest and tried to appear as if he were avoiding it. When the $40 million bond issue came before Council on June 5, 2006, he recused himself from voting on, or even discussing, the proposal. He didn’t mention that he already had worked on behalf of the developer.

    The Ann Arbor News says Greden admits setting up the meeting “to get a better understanding of flood-plain issues concerning the project.” If Greden was recusing himself from involvement in the project, why did he need a special, private meeting to understand these flood-plain issues? Of course, he told The News that it was the client who requested the meeting. Why didn’t he tell the client to leave him out of it call Bobrin on its own? Or did he, and they, think that his connections would make the difference?

    And there’s more. Greden has received a large amount of his campaign money from a dozen people with direct financial interests in the Broadway Village project.

    At his June 28th fundraiser, Greden received six $100 contributions from individuals associated with Broadway Village developer Strathmore Development Co. – three principals of the company (Evert Kramer, Jr., Thomas Eckhardt and Sandra Orlando), two wives of principals (Sharon D. McGraw, wife of Kevin T. McGraw; and Marsha Benton, wife of Thomas Benton), and its Associate General Counsel, Julia Skinner, none of whom lives anywhere near Ann Arbor. Is it just a coincidence that $100 is the maximum amount that can be given without listing the contributor’s employer, so none of these contributors was identified in Greden’s finance reports as being associated with Strathmore?

    Among Greden’s earliest contributions, in August through December of last year, were seven totaling $2,900 from individuals connected to Broadway Village. Greden received $1,000 from developer Peter Allen, the original promoter of Broadway Village, and his wife. He received $500 from Connie Dimond, an architect with JJR, the local planning firm working on Broadway Village. The maximum that an individual can give to a state representative campaign is $500. He received $300 from Joseph Fazio, the Miller Canfield partner doing most of the legal work for the developer.

    McKinley Associates, the large landlord and developer, is the leasing agent for Broadway Village. Greden has received $1,100 in contributions from three members of its Board of Directors: Albert Berriz, McKinley CEO; Paul Dimond, Chairman of the Board and married to JJR architect Connie Dimond; and board member Wendell Dunbar.

    The most interesting of these contributions is the one from Albert Berriz. According to public records, Berriz has given over $20,000 in recent years to a number of state and federal Republican candidates and committees, including the maximum to George W. Bush, and “not a dime” to any Democrat until Greden.

    Greden also received $3,000 from Miller Canfield’s PAC.

    Contact: Dave DeVarti, Spokesperson
    Organization Name: Progressives of Washtenaw
    Telephone Number: 734/995-2850
    Email Address: Progressives@comcast.net
    Web site address: http://progressivesofwashtenaw.org

    Progressives of Washtenaw (POW!) is a political organization dedicated to the support of progressive candidates representing the people of Washtenaw county at all levels of government.

    Paid for by Progressives of Washtenaw, 1730 David Ct., Ann Arbor, MI 48105


       —David Cahill    Aug. 1 '06 - 05:29PM    #
  280. (Note: #278 went up as I was writing; these comments don’t reflect that entry.)

    “At least the City has some say in this project with the leverage of the bonds.”

    In my opinion, the line above is more to the point. This long thread should be discussing whether the city is getting the most for its leverage, via the bonds. One question I’ve been asking is whether the city can lower the TIF money while getting more out out the project in terms of affordable housing, and/or in terms of additional environmental amenities. Some comments very early on talked about BV economics that favored national retail chains over locally-owned shops. And any such discussion also assumes Strathmore comes through on its end of the final bargain, whatever that is, otherwise there is to project on which to comment.

    The city doesn’t have to “give” an “extra $36 million,” as it maintains the option to give much less. One reasonable question to ask is how much infrastructure work would get done and how much parking would be available if the TIF financing were limited to $4 million. And then there’s John Q’s scenario of a very small TIF leading to much greater density.

    While sharing some of the concerns expressed by HVV in #275, it has too much of a Libertarian Party tone to it. Civic funds can be used, judiciously, as a tool to help regulate economic development. The question is how much funding should be applied to the BV project and under what conditions—how much leverage for how much money.

    On a side note, what irks me is that some all-greenway-only advocates (though certainly not all) switch gears completely when arguing the case for their pet downtown project. They drop the economic libertarian sensibility that’s so uncompromisingly applied to Broadway Village and instead become huge fans of big city subsidies. They argue that these greenway subsidies will easily get paid off by phantom tax increases from phantom future development at the edges of the imagined greenway, much of which follows right alongside railroad tracks. For these folks, it would appear not to be political priniciple that’s at stake so much as just using whatever line of argument that might best manipulate a given political situation. (Personally, I think some level of subsidy for a partial downtown greenway—which also includes significant low-cost housing, some new retail, and an arts & community center—would be great.)


       —hale    Aug. 1 '06 - 05:32PM    #
  281. ”(Note: #278 went up as I was writing….)”

    Ditto for #279.
    Geez, was I slow, or what, in getting back to finishing my comments above?

    Looks like there’s an effort here to raise the Greden/Bobrin meeting further “up the totem pole” in meaningfulness. As I’m tired of writing (for now) and am no expert on the meaning of this specific ‘secret meeting,’ will leave it to HD, John Q, Todd, Juliew, Dale & others to reply about how relevant Greden & his drain comissioner meeting is to the future of BV. Sounds like it will definitely be used as strong, primary-related ammunition.


       —hale    Aug. 1 '06 - 06:01PM    #
  282. Isn’t there something unethical about passing off a press release from a group as something that was passed along to you when you’re a supporter (member?) of the same group?

    http://progressivesofwashtenaw.org/more-about-pow/pow-supporters/

    Makes you wonder what else Cahill has been pushing now that his role as a member of a PAC has been exposed….


       —John Q.    Aug. 1 '06 - 06:11PM    #
  283. “When the $40 million bond issue came before Council on June 5, 2006, he recused himself from voting on, or even discussing, the proposal.”

    So in summary, a licensed Ann Arbor attorney worked on behalf of a client, and when it came time for this attorney to vote on something that would have a material effect on this client, he recused himself from voting as this would be a conflict of interest.

    Wow. Call the producers of the X-Files. That is a serious conspiracy.

    In related news (brace yourselves), I as a licensed brewer in the City of Ann Arbor, sold beer to a few customers yesterday. I know, I know. I should be ashamed. I don’t know what I was thinking. I must’ve been the heat.

    I hope Greden replies to this with something that’ll put a few bucks in the swear jar.


       —todd    Aug. 1 '06 - 06:16PM    #
  284. Dustin- No, I don’t want the site to stay the same way for another 10 years. I specifically cited $36M as being the subsidy, not including the $4M for the clean-up. As others have said before, doing the cleanup is a good idea for all concerned and should be accomplished by bond sales, state contributions, or whatever means to get it done before it gets into the water supply. After that, however, building a parking structure and other unnamed improvements for the purpose of making a private investment profitable smacks of giving the private interest a turn at the public trough. If I want to buy an old decrepit house to fix up and sell or live in, do I have a right to “brownfield” money from the government to do that, and then the right to allow my property taxes to pay for that so-called “loan”? Hell no! By the same logic, once the city has cleaned up the chemical spill, any development project for private profit should be financed by its owners and/or bankers. If experienced financiers who don’t want to lose money don’t want to finance Strathmore’s own parking needs, maybe they should be listened to, and the project scaled down to one that is financially palatable. If it succeeds, the taxpayers gain in an easy to balance city budget (and the owners profit); if it fails, that is how entrepreneurship is supposed to work. The same parties should shoulder the risk and get the return.
    To Dale, DCED, Parking Structure Guy, and other anonymous contibutors who are expending more energy on ad hominem attacks than in logical arguments: Must You?


       —Hunter Van Valkenburgh    Aug. 1 '06 - 06:27PM    #
  285. If I want to buy an old decrepit house to fix up and sell or live in, do I have a right to “brownfield” money from the government to do that, and then the right to allow my property taxes to pay for that so-called “loan”?

    You don’t have the right to, no. That doesn’t mean that the public couldn’t decide to give you a break if they thought there was some kind of public benefit from your fixing up the property. Which does happen; for example, if you live in a historic district than you may be able to get tax credits for certain improvements.

    So the interesting question is whether the public benefits (pollution cleanup, new housing and retail close to downtown and major employers, increase in value of nearby property, etc.) are worth the costs (opportunity costs from property tax on whatever goes in instead, risk the development doesn’t pay back the bonds in full).


       —Bruce Fields    Aug. 1 '06 - 06:59PM    #
  286. (Sorry for the missing attribution—there were supposed to be quotes around that first paragraph….)


       —Bruce Fields    Aug. 1 '06 - 07:03PM    #
  287. “If experienced financiers who don’t want to lose money don’t want to finance Strathmore’s own parking needs, maybe they should be listened to, and the project scaled down to one that is financially palatable.”

    Come on back to reality. If it was financially feasible to build a “scaled down” project, don’t you think the 7-11s and strip malls would already have been built?

    Why haven’t they been built? Because it doesn’t make any sense from a financial standpoint. I know we want to blame this on “greedy developers” looking to maximize their profits. But if that’s the case, these are dumb developers. If this was a site that could have been developed as a “scaled down” project, any developer with an ounce of sense would have cashed out on this site a long time ago, especially with the Cahill-ites running around.


       —John Q.    Aug. 1 '06 - 07:07PM    #
  288. HVV: I am not sure you are getting the point here. Unless there is a development, there will be no $4 million for the clean-up. And experience-logic would tell us that this whole site will not be redeveloped for quite some time (10 more years?) without state and local government help, otherwise it would have happened by now.

    Your problem seems to be with the whole State Brownfield Redevelpment Act. As I said earlier, it is not only designed to facilitate developments that will clean up pollution but also redevelop blighted sites in cities VS “greenfields out in the countryside. It is a tool against sprawl. You don’t need a parking structure in a greenfield, you just build multi acres of impervious surface at a fraction of the cost.

    This develpment would also spur hundreds of construction jobs for a couple of years, 140 places for people to live, with 36? or so, affordable units, offices, stores and restaurants for people to work, eat, shop and play. In short, it is an investment in the economy. It will lead to the redevelopment of the the whole area and the area is not looking so good now… It will put $100’s of millions back into the local economy. Anybody in the construction trades would hate to see this opportunity missed and most of the people within a mile of the site would like to see it developed.


       —Dustin    Aug. 1 '06 - 07:15PM    #
  289. “scaled down to one that is financially palatable”

    Apparently, Hunter, such a thing doesn’t exist on top of a contaminated site. It may be counter-intuitive, but I think John Q is correct in that the only viable alternative, short of a direct government effort to accomplish the cleanup, is a more intensive development. If you have something else in mind, please share. Keep in mind that if the city sold bonds for the single purpose of financing a cleanup prior to any development, taxpayers would be footing that entire $4 million plus interest (approx. $8 million total?)

    A viable solution that’s fair to taxpayers doesn’t exist. (See #198.) The best options are those that give the public the best return for the least risk, with a reasonable profit for the developer, as hale, at least, has described. Stopping this project out of spite is not in the public’s interest, and that seems to be the only remaining relevant issue, as the financial solvency concerns continue to receive close scrutiny by all involved.


       —Steve Bean    Aug. 1 '06 - 07:22PM    #
  290. Others have said it in slightly less diplomatic ways before but I’m starting to agree with their statements that opponents who say they want a “scaled down” development really want no development at all. Why? It’s not as if there’s a lack of ideas or vision about how Ann Arbor should develop. So when you ask people to present their alternative and they fail or refuse to answer, what other conclusion can you come to? That they have absolutely no idea? Or that they are opposed to any development but refuse to say so knowing that it will expose the basic dishonesty of their arguements? I’ve never said that Broadway Village is perfect. But for those who are opposed, it’s time to come out of hiding and state what you really want.


       —John Q.    Aug. 1 '06 - 07:46PM    #
  291. I’m puzzled by two claims that seem to be asserted as facts in this discussion.

    The first is that the property has been sitting around for ten years, with no developer interest. As I understand it, the anchor tennant was Krogers, which pulled out to build a much bigger store up the road. In such cases it’s very common for the tennant to decline to sublet their space, as they don’t want competition nearby and the cost of remodelling for non-grocery uses would mean the subletting revenue would be modest. This usually means an empty store for a few years, as was the case with Farmer Jacks on Stadium, and delay on redevelopment.

    Then the current developer came along, acquired control of property through options, started the development process, and finally bought all the parcels. This took several years. From this point of view, it’s very unlikely that the BV property was undesirable and adrift for 10 years. It’s just the normal time frame for a major redevelopment that follows the withdrawal of an anchor tennant that still has a lease.

    The second assertion that seems very dubious to me is that the project wouldn’t be economic if downsized or if the subsidy was less. If that’s the case, why do other major developments that are less dense or not subsidized – or both – proceed in this town? Many have in recent years, and the pace is obviously picking up. The BV location is very good for many uses. It’s sizeable enough for several kinds of projects. City officials have proven to be highly cooperative. This site is just as developable as a dozen others that are seeing major development, especially if there was a $4 million subsidy to clean it up (making it a level playing field with untroubled sites).

    I like a lot of what BV would be, without question. In other areas, there are many points worth considering about this project, on both sides of several issues. But they don’t include the claim that the site would not be relatively quickly developed (like others, with substantial density) if this current project vanished, or that a $ 40 mil. TIF-backed loan would be required to achieve this. These claims create a false “straw man” that makes just about anything else look good. BV shouldn’t be judged in comparison against an artificially negative alternative.


       —AK    Aug. 1 '06 - 07:48PM    #
  292. “As I understand it, the anchor tennant was Krogers, which pulled out to build a much bigger store up the road. In such cases it’s very common for the tennant to decline to sublet their space, as they don’t want competition nearby and the cost of remodelling for non-grocery uses would mean the subletting revenue would be modest.”

    There was also a C­VS there for a short time after the Kroger left. I wonder what was up with that?

    “BV shouldn’t be judged in comparison against an artificially negative alternative.”

    Fair enough. But how do you get a realistic idea of the alternatives?


       —Bruce Fields    Aug. 1 '06 - 08:11PM    #
  293. Maybe the alternative is not being mentioned because there is no current idea of a suitable alternative. I’m thinking of an argument along the lines of “I don’t know what I would like there, but this isn’t it, so I would rather wait for something better.” Since the opportunity cost for waiting is not being burdened on C.A.R.D., why not obstruct?


       —jcp2    Aug. 2 '06 - 01:58AM    #
  294. “If that’s the case, why do other major developments that are less dense or not subsidized – or both – proceed in this town?”

    Your assumption, to counter what you call a false assertion, appears to be that all developable land is equally valued. If the BV property was cleaned up, you indicate that it should be able to attract development that is less dense than BV and without subsidies, just like other properties in town have been developed.

    The problem with your assumption is that it ignores reality. Not all property in Ann Arbor is equally valued. Downtown property is often more attractive/valuable that other locations around town because of its location (the old real estate saying of “location, location, location” still applies), its relative scarcity and its zoning, which allow more intense uses and higher density. This allows developers of those sites to bring in uses that help pay the rent, charge higher rents than in other locations and build higher buildings, increasing the potential for additional revenue. With all of those built-in advantages, subsidies are often not needed and property owners can pick and choose between the developments they want to pursue.

    In contrast, locations like BV lack many of the advantages of downtown property. The location isn’t considered as valuable as downtown property (or greenfield sites, for that matter), the zoning doesn’t allow the intensity of uses and the development can’t be built as high. Since the location isn’t as attractive to users as being downtown (or in Scio or Pittsfield), the developers can’t attract the same kind of users, they can’t charge the same levels of rent and they can’t build as high, limiting the potential revenue stream.

    Of course, this is all generalizations and there will always be exceptions. But the general principles apply and in this case, it’s that you can’t compare apples to oranges and call them the same.


       —John Q.    Aug. 2 '06 - 04:05AM    #
  295. The alternative development mentioned previously is good evidence for both of AK’s points in #291. The alternative plan, which would be implemented if financing for the current project fall through, would be a Walgreens or other “standard commercial structure”– at least that is what Cahill says in #102. So we do have a likely alternative that would not require another 10 years to develop and assumes significantly less (if any) TIF for a downsized development.

    With this alternative, we can pick out some differences to measure the TIF against. These are some possible differences:
    1. Cut the parking garage and keep the large parking lot
    2. Probably lose the public space and “greenwalk” along the creek
    3. I think the public improvements listed in the current TIF include major repairs to sewer and water lines. Cutting the TIF means paying for it some other way or adding stress to the current system.
    4. Less increase in value of site and surrounding land. Hard to say what the difference would be, but certainly the two would not have the same “rising tide” impact on the neighborhood.
    5. Trading restaurant, retail and professional/medical services, for Walgreens services near the downtown.
    6. Lose all housing components including “low-income” housing.

    I’d encourage others to critique and add to this list of ideas as well as address the larger question of whether this is a fair evaluation of a likely alternative or another straw man.

    I’d also encourage (again) those with details on this funding to speak up in this forum. I think that the ambiguity of the budget for “other public improvements” and holding out on the formulas and numbers that are being used to determine the financial risk are doing the city and the project more harm than good.

    Also, when does the 45 day period of intent end? Cahill mentioned it was voted on in the June 5 meeting, which would suggest the deadline has already passed.


       —Scott TenBrink    Aug. 2 '06 - 04:32AM    #
  296. John, all you say is true. Of course not all properties are equal. I didn’t assert or imply this.

    But properties as dissimilar as ones way out on State Street, Depot Street near Caseys, several downtown lots (some, not all), a few on Plymouth and Stadium are all being pretty densely developed in various ways. There are economic benefits to all of them as far as I can see – and none are getting massive public investments, or drawing local criticism due to their size. Their desirability and zoning are reflected in the price of the property, not just future rents.

    I can’t imagine why a sizeable property, with flexible zoning and a City Council that is very supportive of development, on a major road near downtown and the U-M medical center, would not attract considerable development interest if the current project didn’t exist. Cleaning up the pollution using a TIF would make it a level playing field with other sites.

    Would something close to an ideal development from a New Urbanist point of view arise? Probably not. That’s rare. Especially in a town where there’s no commuter rail and a modest bus system.

    But claiming that either nothing will happen on this site (as several have here) is absurd. Scott’s assumptions above are more realistic. Though I think the site has more value than to only contain a Walgreens (which is no small thing in itself though).

    As Scott said, what the balance of the subsidy/investment/whatever would actually be used for makes a difference. If it has major public good written all over it (that is, it’s not primarily for the benefit of the development) that’s something I’d take seriously.

    Why is it that the purpose for such a large amount of money is not well known to anyone followin this issue? It amazes me that such a large sum of money can be considered, for years, to be invested in this development with so little disclosure of the purpose. It could well be that information on this point would really help people accept the public financial role in the project. Am I missing something, or are my expectations for information disclosure just too high?


       —AK    Aug. 2 '06 - 12:06PM    #
  297. Location, location, location. This one’s got a raft of petition pushers living just up the street from it, several of whom have demonstrated that they will seek any pretext to try to stop a change to their neighborhood.


       —Dale    Aug. 2 '06 - 12:59PM    #
  298. By the way, there’s a new City of Ann Arbor Web design at a2gov.org (it looks good but I haven’t tried to navigate it) and Broadway Village info is linked from the very front page.


       —Dale    Aug. 2 '06 - 01:35PM    #
  299. Dale wrote: ”... there’s a new City of Ann Arbor Web design …”

    Sorry for picking this up and sending things woefully OT, but …

    I will miss that photo on the old front page that was captioned with a link labeled ‘Voting and Garbage Collection’ It made me laugh every time I saw it.

    Opting for Google as the search tool for the site, though? Given that several of the links don’t work, or lead back to the old site design, I wonder if the rollout was rushed a bit.

    LP: C’mon, let’s just build it in downtown Ann Arbor!

    SB: But dude, they don’t even run Google search on the City website! Where’s the love?

    LP: [sigh] Okay, if I can get them to put the Google search engine on the website tomorrow, can we build it in downtown Ann Arbor?

    SB: Okay, but AdWords would also be nice, yes? I mean we’re building the Adwords headquarters there, not the Search headquarters.
    ——————-

    But seriously, having search results delivered with a context for the search terms (by the search tool embedded in the site) is at least an incremental improvement over the old city site search tool, which delivered just a document list. My general strategy for trying to find anything in Council Minutes has ALWAYS been to just restrict a web search using a general tool to the a2gov site, for exactly that reason.

    But the ‘value-added’ that Google brings compared to other search tools—of ranking search results by weighting how many links lead to the target—strikes me as having limited relevance for a site-specific search tool. More important for the user of a local government website, I think, is the format and layout of the search results.

    Specifically, what would be better is if search results included EACH instance of a search term instead of just one, and delivered them in a more robust context than the standard, roughly 10-word, Google snippet.

    So, for example, if I wanted to find out how active Councilmember Easthope was on Council and chose to arbitrarily define ‘active’ by how many times he’d introduced a resolution, I could search for ‘introduced by Councilmember Easthope’ and start to get an idea of how many resolutions he’d introduced AND what each of them were about … all from the search results, without ever having to open up the PDF’s containing the meeting minutes.

    Also, when the City adds new documents, they just have to wait until the site gets crawled (probably within some small number of days) for it to appear in the search index. Ideally, the City needs to have the ability to add a document and manually update the index the search tool runs off as soon as it’s added.

    Picosearch is one of many companies providing a tool that has that functionality. (1) Indexing can be controlled by the website owner. (2) Context window of search terms in results can be set as wide as you like, and each instance of a found term appears in its own context. It’s these two attributes that led me to integrate the Picosearch tool into my own site.

    But Picosearch would cost the City some money (they would exceed by a lot the 250-page limit for free service). Google site search costs nothing.

    I wonder if this might be a creative way that Google, perhaps in partnership with some Library of Science folks at UM, could ‘kick back’ a small part of the tax-abatement they’ll likely receive: develop a site-specific search tool for local government websites with the desired results-layout and provide it gratis to a2gov.


       —HD    Aug. 2 '06 - 02:59PM    #
  300. I’d like to add a few comments

    1. While I think it is great to discuss the merits of BV, including what we are getting for these bonds, we are a day late and a dollar short. All of us who have had questions/issues should have starteed raising them two years ago.

    The project has already been approved. All that the City is doing now is checking the math behind what was approved. We have no one to blame but ourselves as we had plenty of time to discuss what we’re getting for our money.

    2. The State of Michigan is contributing $3 million dollars because they believe that this site/project merits funding as a Brownfield project that is worthy of economic development dollars/tax credits that are in short supply in this State. That’s an awful big real world award that tell us that this project is going to be good for the State and City.

    I think that this also addresses AK’s questionable assertion that the years that this site has stood vacant is a normal situation…..and I’m not trying to single you out, AK, as you have made some great points in your last couple of posts. I just disagree with this particular assertion. The financial burden of the site clean up when put together with other site particulars makes development awful difficult there…..and it appears that Lansing agrees.


       —todd    Aug. 2 '06 - 03:40PM    #
  301. A.K’s comments further above and Dale’s in #297 have synthesized into a moment of abject conjecture about Broadway Village. (In the event something along these lines was brought up a while ago and I’ve forgotten, please forgive.)

    Maybe Strathmore & the city have taken the same page from the Republican Party playbook that the All-Greenway-Everywhere folks use, one that has, in general, worked very effectively for the far right and the national GOP—who in turn likely got the idea from the New Left of the 60s. That is, try to win by demanding the impossible, so that you can negotiate down for more than you could ever have otherwise hoped to get.

    The absurd notion of a “full greenway,” a house of cards predicated upon the railroad company handing its tracks over to the city for permanent use as parkway, serves the function as an extreme starting point for negotiation. After a future “compromise” with local officials and “all-greenway” opponents, they may wind up with way more than any modest-sized, local group of activists could have imagined at the beginning. (—also, remember that there’s a meeting tonight )

    As for Strathmore & the city, my conjecture is that the TIF upper limit is way more than they expect to get. Should it be the case that the amount for “other public improvements” is being left vague, while they’ve clearly been aware for some time that a brigade of potentially very active opponents resides “up the hill,” the $40 million may be their version of an ‘absurd’ starting point. To pull a figure completely out of the air, could it be that their battle plan has been to negotiate down to, say, $18 million under the assumption that a group like CARD would appear? Keep in mind that for most of us—who live on modest incomes and do not spend hours poring over line items in city budgets or managing funds for very large departments—the difference between $20 million and $40 million is rather abstract. As a result, if the TIF figure now being bandied about were $18 million instead, CARD would have little trouble making that amount sound just as outrageous to their supporters as $40 million.


       —hale    Aug. 2 '06 - 04:12PM    #
  302. hale: in social psychology circles, this is referred to as the “door in the face” technique – ask for the moon, and any later request sounds reasonable. (Its opposite, which I expect was named first, is the “foot in the door” – get somebody to agree to a little, and then keep asking a little more.)


       —Murph    Aug. 2 '06 - 07:45PM    #
  303. Regarding #284 above where it was written,

    “Dustin- No, I don’t want the site to stay the same way for another 10 years. I specifically cited $36M as being the subsidy, not including the $4M for the clean-up. As others have said before, doing the cleanup is a good idea for all concerned and should be accomplished by bond sales, state contributions, or whatever means to get it done before it gets into the water supply. After that, however, building a parking structure and other unnamed improvements for the purpose of making a private investment profitable smacks of giving the private interest a turn at the public trough. If I want to buy an old decrepit house to fix up and sell or live in, do I have a right to “brownfield” money from the government to do that, and then the right to allow my property taxes to pay for that so-called “loan”? Hell no! By the same logic, once the city has cleaned up the chemical spill, any development project for private profit should be financed by its owners and/or bankers. If experienced financiers who don’t want to lose money don’t want to finance Strathmore’s own parking needs, maybe they should be listened to, and the project scaled down to one that is financially palatable. If it succeeds, the taxpayers gain in an easy to balance city budget (and the owners profit); if it fails, that is how entrepreneurship is supposed to work. The same parties should shoulder the risk and get the return.”

    Indeed, many who have been following this project over the past several years have been saying exactly this all along.


       —EJ    Aug. 2 '06 - 07:47PM    #
  304. A couple of points:

    We are probably not talking about $40 millon here, that is what the develper wants but the range is from zero to 40. Nearly every city council member has been widely quoted saying that unless it turns out to be a good deal for the city after exhaustive study, then well, no deal. So this may all be a moot point.

    Do you understand that without the development, there is no $4 million to do the clean up? If the development does not go through, the developers fall back plan could be to cut his loses, just keep it a strip mall although both Kroger and Rite Aid failed there. No TIF no nothing just put in a strip store or two and no clean up. The pollution stays.

    And once more, the whole point of the Brownfield Redevopment Act was to redevelop blighted areas in cities, not just polluted sites. That means parking structures rather than 10 acres of pavement in Greenfields. (Are we repeating ourselves here?) When was the last time you saw a multi-story privately built parking garage in Michigan? Downtown the DDA builds them for the same reason. Is that not a subsidy too?

    Is there pollution and blight at your old house? Will it put $100’s of millions back into the local economy for years and years to come?


       —Dustin    Aug. 2 '06 - 08:25PM    #
  305. Dustin,

    I haven’t seen anything to suggest that an alternative development plan like a strip mall would not include soil clean-up.

    Is this your assumption or do you have a source for the info?


       —Scott TenBrink    Aug. 3 '06 - 02:15AM    #
  306. Why would it be cleaned up? Who would pay it? The clean up money only comes with brownfield redevelopment. The property owner is not responsible under Michigan law. He can ignore the pollution if he wants, just let it go to the river.


       —Dustin    Aug. 3 '06 - 04:04AM    #
  307. Dustin,

    It seems to me that the same could be said for the current proposal. The property owner is not obligated to do soil remediation for this project either. Perhaps they have chosen to do the clean-up specifically because the remediation money was part of a larger financial incentive. But it is likely that a smaller total package would allow for including clean-up with the strip mall.

    I’m not arguing that clean-up would definitely happen with the alternative development proposal. I’m asking if there is any evidence either way. the “Why would they?” argument isn’t enough for me.

    I’d be more convinced by an argument that shows how the differences between the two options make it unlikely for brownfield redevelopment funds to be allocated for the strip mall option. Even more convincing would be someone’s first-hand knowledge of the alternative proposal that clarifies whether brownfield funds are included.

    Todd,

    I agree that all this commentary is late coming. However, CARD’s petition does show that the public can influence a project even after it has been approved if the funding hasn’t been settled. I, like others posting here, hope that that includes influence beyond simply killing any use of the site. The fact that the developer has had an alternative approved along with the BV design indicates that discussion on the differences between the two isn’t moot yet.

    Also, since David Cahill is in the know on the petition, maybe he can inform us of the deadline? I’m assuming that the city will have to state their decision on the funding sometime soon. I’d be interested to hear about the progress of the petition as well.


       —Scott TenBrink    Aug. 3 '06 - 04:46AM    #
  308. It seems that over the past several years, the discussion has never precluded any developer from getting money for the environmental clean-up (and even additional money for infrastructure improvements), to bring the site to a point where we’re talking about a level playing field. But many have argued that these items do not come even close to totaling $40 million.

    Also, when it was written above:

    #304: “No TIF no nothing just put in a strip store or two and no clean up. The pollution stays.”

    #306: “The property owner is not responsible under Michigan law. He can ignore the pollution if he wants, just let it go to the river.”

    #307: “The property owner is not obligated to do soil remediation for this project either.”

    I’m not sure the above three claims are true. Owners of contaminated properties DO have responsibilities. And the purchaser of a contaminated property inherits these responsibilities. That is why lending institutions require environmental site assessments before loan packages are finalized. Should the borrower default, the lending institution does not want to be left owning a property that will cost it many times more to clean up, than what the ultimately cleaned up property will then fetch on the real estate market.

    Likewise, if one can purchase a contaminated property for very cheap, do the required environmental clean-up, and then sell the cleaned up property for enough money (and then some) to cover the cost of the initial purchase and the clean-up, than the initial purchaser of the contaminated property can make money this way.

    Does anyone know if Strathmore currently owns outright all of the properties (including the contaminated properties) that are proposed for development?


       —EJ    Aug. 3 '06 - 06:14AM    #
  309. I’ve been involved in local Democratic politics for a long time, and I am disgusted by the smear campaign being waged by Rebekah Warren’s campaign, including some posts here. I know both Rebekah and Leigh and I am neutral in this race because I no longer live in Ann Arbor, and I gave money to both campaigns. I had hoped to stay out of this, but feel compelled to speak up.

    This week I filed a complaint with the Secretary of State because I believe that Rebekah’s campaign violated State election laws in order to hide the fact that a big Republican donor raised several thousand dollars for her.

    On October 27, 2005, Rebekah held a kickoff fundraiser at Stephen Ranzini’s house at 101 N. Main at 5pm. Tickets cost $100 each. I have a paper copy of the invitation. Later that night, at 7pm, she held a free party at Arbor Brewing Company. There was an e-mail inviting people to both the Ranzini fundraiser for $100/ticket at 5pm and the free party at Arbor Brewing at 7pm. I copied a part of the e-mail below so you can see that the Ranzini event was a $100 fundraiser, but the Arbor Brewing event was free.

    State law 169.226 says a candidate must disclose on their campaign reports the name, address and other information for every fundraiser they hold. Rebekah’s January campaign finance report did not list her fundraiser at Stephen Ranzini’s house. Instead, she claimed the fundraiser was held at Arbor Brewing, even though both the invitations confirm that the fundraiser was at Ranzini’s house. Here is a link to Rebekah’s January campaign finance report showing that she listed the Arbor Brewing party as the fundraiser on October 27, but did not list the Ranzini event at all.
    http://tinyurl.com/jatyz

    Here’s the link showing that Ranzini and Lisa Schwartz, who I think is his wife or his girlfriend, each gave Rebekah $500 on the date of the fundraiser at his house.
    http://tinyurl.com/z3p2t

    I believe that Rebekah may have tried to hide the Ranzini fundraiser, in possible violation of State law, because Ranzini gave thousands of dollars to conservative Republicans like George Bush, Spencer Abraham, Nick Smith, Brad Smith, Mike Rogers, and the Republican Committee. Here are two links showing his donations.
    http://tinyurl.com/ztw5p

    http://tinyurl.com/z83xg

    When Rebekah’s campaign started accusing Leigh of ethical violations about his fundraising and started bad mouthing him for taking money from Republicans, I became very upset because that appears hypocritical to me, considering she may have violated State law to hide the fact that a conservative Republican not only gave her a lot of money, but held her kickoff fundraiser at his house.

    I am disappointed that Rebekah’s supporters made this campaign so negative and that one fellow Democrat would behave this way against another Democrat. But as I said before, I felt compelled to speak up because Rebekah’s campaign is waging a negative campaign.

    ***

    Support a Noble Cause! Send Campaign Contributions to Rebekah Warren
    for State Representative, 234 8th St., Ann Arbor, MI 48103

    Friends, neighbors, political leaders and activists invite you to join
    Rebekah Warren
    Democratic Candidate for 53rd District State Representative for her Campaign Kick-off

    Thursday, October 27th
    7:00 ? 9:00 p.m.
    Arbor Brewing Company
    114 East Washington Street Ann Arbor

    It’s a Halloween Celebration!
    Meet the candidate and enjoy fun Halloween games and treats.
    Kids welcomed and costumes encouraged!
    There is no cover for the event, but campaign contributions are gratefully accepted!

    Or, stop in for a drink and hors d’oeuvres with Rebekah before the Kick-off.

    Thursday, October 27th 5:00-7:00pm
    101 North Main Street #1004
    Ann Arbor
    Tickets for the pre kick-off reception are $100.

    [Image] For more information, please contact Sarah at (734) 717-2748 or sarah_curmi@yahoo.com or Rebekah at (734) 662-0268 or rebekahwarren@comcast.net.
       —Eric    Aug. 3 '06 - 10:49AM    #
  310. Stephen Ranzini? He’s a pretty powerful guy. He was, like, last year’s Cahill.


       —Parking Structure Dude!    Aug. 3 '06 - 12:55PM    #
  311. Yes, EJ, the developer now owns outright all the parcels, including the contaminated property – except possibly the Kroger property, and the developer has an option to purchase that. I haven’t been following the property acquisition that closely. I think I saw something to the effect that the developer has finally purchased the Kroger property. Sorry I can’t be sure on this.

    And, todd, all of this not necessarily a day late and a dollar short. There is no binding agreement between the City and the developer unless everything is agreed, which hasn’t happened yet.


       —David Cahill    Aug. 3 '06 - 12:59PM    #
  312. Scott asked (in #307): “Also, since David Cahill is in the know on the petition, maybe he can inform us of the deadline? I’m assuming that the city will have to state their decision on the funding sometime soon. I’d be interested to hear about the progress of the petition as well.”

    I believe the deadline was yesterday, August 2; and according to a “breaking news” blurb on MLive/AANews, CARD fell short of gathering the 9000 signatures needed.
    I feel bad for this group of people, who obviously feel very strongly in their position, but I am glad that one less hurdle is in the way for what I think will be a great addition to my neighborhood.


       —Lane Maiden    Aug. 3 '06 - 01:20PM    #
  313. 300 plus posts, any way to get a new thread on this?


       —John Q.    Aug. 3 '06 - 02:02PM    #
  314. Here is an excerpt from today’s AA News story:

    Chappelle said his company has invested $28 million into the project, including land purchases.

    “There is no turning back,’’ Chappelle said. “We are going to develop something on that site. We’d like it to be (Broadway Village at) Lowertown.’’

    End of excerpt. Two things of note.

    First, I am quite surprised at the claim that the developer has already invested $28 million. On what? The land can’t be that expensive, can it?

    Second, Chappelle seems to be leaving the door open for something else besides Broadway Village to be built. Hard to read the tea leaves, but maybe the City has told him to forget about the $40 million bond issue and to think about a lesser amount.


       —David Cahill    Aug. 3 '06 - 03:45PM    #
  315. Here’s the story that David referenced.


       —Steve Bean    Aug. 3 '06 - 04:46PM    #
  316. $28 million isn’t actually all that surprising; the site is 7 acres near downtown Ann Arbor and the University Hospital. Beyond the cost of “the dirt,” that figure probably includes other expenses he’s already put into the project:

    * “soft costs” involved in developing the project plan and the environmental work planning

    * costs to rehab the strip of stores across Broadway, and costs to move the tenants that had been in the east side of the planned development into that new building


       —Lane Maiden    Aug. 3 '06 - 07:31PM    #
  317. Does anyone know how much the developer paid in total for all the properties that make up this area? Because of the environmental contamination, the properties could have been acquired relatively cheaply. What might this site then be worth once it is free of environmental contamination?

    Even without $4 million in public help for the clean-up, is the playing field all that unlevel? I don’t know that anyone knows, as the numbers, rationale, etc., to my knowledge, have not been made available to the public.


       —EJ    Aug. 3 '06 - 07:37PM    #
  318. “Even without $4 million in public help for the clean-up, is the playing field all that unlevel?”

    Are you serious? OK, if we’re building in Manhattan, I suppose that $4 million dollars isn’t all that much difference but in Ann Arbor for a 7 acre site, an almost $600,000 per acre difference in site costs where you haven’t even put a penny into the building or infrastructure is huge!

    Let’s put it this way. Suppose you and your neighbor were trying to sell your houses for $200,000 (I know, imaginary prices in A2). The houses are exactly the same in every way except your house has asbsetos siding that a new buyer would have to remove and replace at a cost of $100,000. So anyone considering buying your house would have to bank on needing $300,000 – or they could buy your neighbor’s house at $200,000. Now, how many people will buy your house? And would you consider it a level playing field when selling your house?


       —John Q.    Aug. 3 '06 - 07:58PM    #
  319. To: John Q. regarding #318

    First of all, I don’t know what a 7-acre site in this part of Ann Arbor with no contamination could fetch on the real estate market.

    Regarding your response in #318, I am thinking that if I have a home with a true market value of $200,000, but a home that requires $100,000 in an asbestos clean-up, that if I were to sell this home, I could probably expect to get much less than $200,000 because the buyer is going to have to pay out $100,000 just to get the home up to current standards.

    So my comment above in #317 was along these lines, I am thinking that the developer might have been able to acquire these lowertown properties at a reduced price (a price less than that of a 7-acre Ann Arbor site that has no environmental contamination). So even if the developer has to pay out money to clean up this site, given that the original purchase price might have been much lower, the playing field might not be as unlevel as it first appears.

    Does anyone know what the developer paid in total for all the properties that make up the 7-acre site that we’re talking about? Also, does anyone have any idea of what a similar 7-acre uncontaminated site might fetch on the real estate market? The difference between what the developer paid out in total and what an uncontaminated similar 7-acre site might fetch may not be $4 million dollars, but I am thinking there probably is at least some difference, possibly not a negligible difference.

    Finally, again, I do not have the numbers, and I’m not sure the correct numbers are readily and clearly available to the public. Which is completely understandable, but only if the developer was not asking for $40 million in TIF funding. Given that the developer is asking for this $40 million in public money, I believe clear and correct numbers should be made available to the public for consideration.

    Sorry for the confusion in #317.


       —EJ    Aug. 3 '06 - 09:48PM    #
  320. According to the City records:

    https://is.bsasoftware.com/bsa.is/AssessingServices/ServiceAssessingSearchResults.aspx?i=1&on=lower&appid=0&unit=283

    Lowertown Development (also in the records as “Lower Town Development”) owns 6.14 acres for which they paid around $944,000/acre or a total of $5,796,250 (if my math is right).

    Here’s some sites that might be considered competition (not prime downtown lots but with commercial zoning)

    http://www.loopnet.com/xNet/MainSite/Listing/Profile/ProfileSE.aspx?LID=14528331&linkcode=1070&sourcecode=1lww2t006a00001
    $1,000,000 for 0.93 acres ($1,075,268/acre)

    http://www.loopnet.com/xNet/MainSite/Listing/Profile/ProfileSE.aspx?LID=14422507&linkcode=1070&sourcecode=1lww2t006a00001
    $725,000 for 4.66 acres ($155,579/acre)
    (
    http://www.loopnet.com/xNet/MainSite/Listing/Profile/ProfileSE.aspx?LID=14548404&linkcode=1070&sourcecode=1lww2t006a00001
    $1,450,000 for 4.35 acres ($333,333/acre)

    So you can see that Lowertown didn’t score any major discount on their property. I think the Lowertown location is more valuable than some of these other properties. But consider that you would have to add the $600,000/acre clean-up cost on top of what is already a significant price difference. Is Lowertown that much more valuable? I don’t think so.


       —John Q.    Aug. 3 '06 - 10:28PM    #
  321. Nice work, John Q!

    So the developer paid $6 million for the property. I think the cost of moving the tenants across the street and building the mini-mall was about $1 million. Sorry I can’t remember where my wetware dredged that figure up.

    So that’s about $7 million. I wonder what the other $21 million was for.


       —David Cahill    Aug. 4 '06 - 01:34AM    #
  322. “I wonder what the other $21 million was for.’

    Architecture fees alone range somewhere between 7% and 10% of the construction costs….and this assumes a pretty straight forward design.

    As I’ve explained dozens of times, every time Ann Arbor makes a developer go back and change the drawings, you can add to the design fees ad infinitum.

    Then there’s the loan that the developer took out to purchase the land, together with all of the taxes. The meters been running on that for over two years now, if I’m not mistaken.

    Then there’s all the overhead that’s tossed in (site selection cost, legal fees, brokerage services, etc.), plus all the public meetings that they have to attend….and these costs have been ongoing for years now.

    And of course, they’re probably another year or year and a half before they can start collecting rent from a finished project.

    This is why I keep saying that the biggest obstacle to affordable housing is the criminally slow approval process. Yes, sometimes developers screw up, and yes, this is an unusually large project, but every month counts….

    The sheer size of this project helps to absorb some of these costs, but it’s still pretty easy to see that all the developer is going to do is pass these costs on to its tenants….leading to the gentrification and corporate chains that Ann Arbor is supposed to be ardently against….

    I’m sincerely hopeful that the passage of Master Plans like the Northeast area plan, together with the technical improvements that are being made to the Building and Planning departments, will help to cut construction costs in this town.


       —todd    Aug. 4 '06 - 02:48AM    #
  323. It didn’t say that they spent $28 million. The article only paraphrases Chappelle as saying they had “invested” $28 million. I doubt they’ve spent that entire amount. Instead, that probably represents:

    * Costs to purchase land including interest (which makes the actual cost of the land more than $6 million)

    * Anticipated costs to get the project started. They likely have estimates for the initial construction that will follow the clean-up once they get the OK from Council for the bonds. If they’ve lined up contracts for that work, they probably see that as “invested” in the project.

    * Legal fees [insert Greden comment here]

    * Engineering fees

    * Environmental fees

    * Architectural fees

    Not saying that all that equals $28 million but it’s likely a very significant investment. Most developers don’t buy property until they absolutely have to do so. That move alone shows that Lowertown is committed to making something happen there.


       —John Q.    Aug. 4 '06 - 03:03AM    #
  324. Just echoing what todd said, the surest way to kill a project is to delay it long enough that the developer can’t stand to carry the costs associated with the project.


       —John Q.    Aug. 4 '06 - 03:21AM    #
  325. Can we get something built there soon – hotel, store, condos, crackhouse, outhouse, whorehouse, anything. The only crime I believe that should be punishable by death is tagging with graffiti but I’m tempted to go over to “Lowertown-to-be” and bust windows and write “Tom rulz!” with a can of Krylon if they don’t get something going over there soon. If we gotta give the developer a bond so be it. I’ll give him my returnables and sell blood or one of my kids to get a decent corner grocery store there (no offense to the Broadway party store). This freakin town is insane sometimes – you can’t help someone build a decent development in a blighted shopping mall but we can piss away time effort and money trying to make a greenway thru the ugliness of an ACTIVE rail line thru the middle of downtown? Oh and let’s drain the pond on Argo (a real greenway) to take out one of the more useful dams on the most dammed river in Michigan? Where do these dingalings come from? Sorry, overall rant is done; I’ll go back to lurking and not posting….


       —Thomas Cook    Aug. 4 '06 - 01:40PM    #
  326. Yes, John Q., thank you much for the info in #320.

    However, I am still having trouble understanding why a developer would willingly go out and pay full price for a 7-acre property that requires a $4 million environmental clean-up. It seems that there must have been some type of discounted pricing involved given the looming $4 million clean-up. Am I missing something here?


       —EJ    Aug. 4 '06 - 07:50PM    #
  327. Here is what I will do to clear up what the $28 million has been invested on.

    A friend of mine has the complete check register from the developer, which was given to the City. It runs up to March of this year. I will ask her to summarize the various expense categories in the check register. We’ll see what they add up to.

    However, this will have to wait until after Tuesday’s primaries. There are priorities. 8-)


       —David Cahill    Aug. 4 '06 - 09:01PM    #
  328. #322: “I’m sincerely hopeful that the passage of Master Plans like the Northeast area plan…will help to cut construction costs in this town.”

    I will graciously stand corrected on this, but it is my understanding that just a few years ago, the Draft Northeast Area Master Plan that was already part way through the public approval process certainly envisioned a mixed used development at the Broadway Village at Lowertown site; however, with more set-back to the buildings, building heights of no more than three to four stories, and more open space available for community building activities. It is also my understanding that at this same time a few years ago, those opposed to the density of the proposal put forth, almost pleaded with the development team to submit a proposal closer to what was envisioned by this (albeit Draft at the time) Northeast Area Master Plan.

    So, when we’re trying to figure out how some of these projects seem to end up with delays…………


       —EJ    Aug. 5 '06 - 02:24AM    #
  329. “So, when we’re trying to figure out how some of these projects seem to end up with delays…………”

    The developer obtained final approval from City Council a full two years before the NE Area Plan was approved, which means that Strathmore was working with the Planning Commission and staff on the design (probably, I’m not sure) a year or more before that.

    It’s hard to hold a developer accountable to a document that doesn’t exist yet, and wouldn’t be voted on for a full three or four more years. That’s sort of like arresting a guy for violating a law that won’t hit the books for a few years.

    But, as I said, developers make mistakes too, and this was a pretty complicated project….
    The point of my last post wansn’t to assess blame and point fingers. Blame is irrelvant to thd discussion.

    The point is that lengthy delays, no matter the cause, costs the city tax dollars, and also drives up the costs for the end tenant…something that all of us can agree is a bad thing.

    Now we have a blueprint to work from. This will help everyone. That’s the great thing (I hope)about the plan. We won’t have to argue about this stuff anymore, assuming the plan was well written.


       —todd    Aug. 5 '06 - 03:21AM    #
  330. “The point is that lengthy delays, no matter the cause, costs the city tax dollars, and also drives up the costs for the end tenant…something that all of us can agree is a bad thing.”

    You could almost call that the Cahill subsidy. Hey Dave, enjoying your giant subsidy? Eating a lot of Plymouth Road Subway on my dime? I’m really loving having it scraped out of the tender inside of my ass.


       —Parking Structure Dude!    Aug. 5 '06 - 04:06AM    #
  331. Tsk. I see you still have your anger management issues, PSD. 8-)


       —David Cahill    Aug. 5 '06 - 01:53PM    #
  332. I have been a supporter of BV from the beginning and I live nearby. The site makes perfect sense to be developed as a dense, mixed-use, downtown-style development. It is within walking of downtown and is a logical extension of the DDA except for the river as a natural barrier; which of course should then become an opportunity as this site and the area evolves.

    Nonetheless, as I have watched the tactics of CARD objectively I saw them manipulate the facts of the TIF by feeding incendiary words to the public, and now after failing they are spinning the outcome of their petition drive; they didn’t get the signatures they required but are still trying to argue that the majority do, in fact, want this. Of course this isn’t true. If it wasn’t for obstacles like full time jobs, families, friends etc. we could go out and have an equally slanted drive to prove the opposite.

    I would suggest that an equally commensurate approach to what CARD has done, and is doing, would be to ask the electorate to support a mixed-use development which features a corner grocery, a movie theater, neighborhood bar, bakery, flower shop, a couple of restaurants, fitness center, professional office etc. This development will have only affordable housing (hundreds of units), underground parking, green roofs, and low utility usage. The streets would be tree lined and there would be cobblestone crosswalks, flower boxes in the windows, second story balconies, street benches, and pocket parks. The residents will be happy and will represent a cross section of American culture; the shop owners will sport college educations but will do so without even the appearance of arrogance. The development will come in under budget and the developer has agreed to fix the city owned utilities in the area since he is working there already. Oh and don’t worry about the contaminated soil, well get rid of it, “No prob.” The project is ready to go and can break ground whenever the community wants. The developer is suggesting starting in October so the grand opening can be ready for Thanksgiving. I think this would get a few signatures.

    Over the top? Sure, but CARD has been, and is, ‘under the bottom’ and even so they failed. That should tell the council, right there, that there isn’t support for a public vote. I think any council member who argues for a public vote is looking to stop the project but lacks the backbone to actually vote against it. Todd is right about delays, they cost a lot. HD is right about council, they should decide. CARD is working every angle to inflict as much pain as possible. We are all paying the price.


       —abc    Aug. 5 '06 - 02:02PM    #
  333. I think the project will be great for the area and it’s residents. Now the thought of an abandoned area remaining for more months, without restaurants, grocery store, outdoor cafes is upsetting and may scare off potential good businesses out of Ann Arbor to avoid this area. Of course many people don’t want to have city people fund this by paying taxes,and maybe they won’t, yet the delays and the potentially unsafe abandoned area is worse, I feel.
    In the MEANTIME where is a little sub shop, donut store, or koney island on Maiden Lane, for residents of Maiden Lane, clinic guests, etc.


       —Judy    Aug. 8 '06 - 04:25PM    #
  334. Hm. Just now I looked for the Broadway Village page on the City’s web site and I couldn’t find it. I kept getting error messages.

    Can someone post the link to that page, with its important link to the minutes of the team meetings, here?


       —David Cahill    Aug. 13 '06 - 10:39PM    #
  335. http://www.a2gov.org/CommunityServices/Planning/Planning/Broadwayvill.htm


       —Bruce Fields    Aug. 13 '06 - 10:51PM    #
  336. Thanks, Bruce!


       —David Cahill    Aug. 14 '06 - 12:06AM    #
  337. My friend with a copy of the developer’s check register says it shows disbursements totalling $21 million through March.

    I’ve asked her for a summary of these disbursements. Maybe I’ll be able to get a copy of the whole check register. If it’s in electronic form, I’ll post it here.


       —David Cahill    Aug. 14 '06 - 10:30PM    #
  338. There is an interview of Tom Crawford, the City’s CFO, by Tom Gantert, about Broadway Village on page B1 of the local section of the AA News.

    Could someone please link the interview here?

    Also, could someone explain in words of two syllables or less how to link something here? It’s not obvious to the technologically challenged.


       —David Cahill    Aug. 20 '06 - 03:26PM    #
  339. “Type the words you want underlined”[colon]http://somewebsite.com.

    Quotes, colon, URL (no spaces)


       —Dale    Aug. 20 '06 - 05:23PM    #
  340. Dave,

    Couldn’t find the Crawford interview on Mlive.

    Dude, you’ve already demonstrated mastery of bolding, so linking will be a snap. Three elements: 1. word or words you want to make a link out of enclosed in quotes 2. then a colon 3. then the URL.

    E.g., when you type this into the comment box

    "two-syllable words":http://www.mlive.com

    two-syllable words appears as the published comment.


       —HD    Aug. 20 '06 - 05:35PM    #
  341. Sorry all for the redundant post. Next time I’ll spend the 8 minutes hitting the submit button instead of trying to eek out an additional bit of humor.


       —HD    Aug. 20 '06 - 05:42PM    #
  342. I’m surprised. You’re right, Dale, the Broadway Village interview is not on mlive. It’s part of the weekly “Q and A” series of interviews with prominent people.

    It’s a l-o-n-g interview. Unless someone else can find the thing and link it here, tomorrow I’ll post excerpts.

    And thanks for telling me how to link, Dale!


       —David Cahill    Aug. 20 '06 - 09:32PM    #
  343. Oop! Sorry, the second sentence of #342 should, of course, read “You’re right, HD,...”


       —David Cahill    Aug. 20 '06 - 09:35PM    #
  344. Here are those excerpts:

    * * * * *

    Q: What step in the approval are you on now?
    A: We are evaluating his proposed financing plan.

    Q: What does that involve?
    A: Some of the things it involves [are] looking at the creditworthiness of the project and the developer, since they are asking for public funds; looking at how they’d like to finance it; looking at what security the city could get if it becomes involved in the project; collateral; who pays in what order.

    * * * * *

    Q: A developer brings you leases for a project. You reject them. Shouldn’t that send up red flags about the project?
    A: It said the city is going to take seriously any plan where public funds are involved. He came back with much more robust leases. We looked at the new leases of today and found them to be acceptable. When public money is involved, we are also looking at the cost of the project. That is very important. If the developer says it is a $180 million project and it includes $40 million of public TIF financing, if in fact we find that the costs are really $160 million, we would question why $40 million of public funds would be needed; why not $20 million? We are in the process of that now. The developer is providing us his cost estimates. We are reviewing that with an independent party.

    Q: What is your gut feeling on the project. Will you approve the $40 million?
    A: I still consider this an early stage. We have quite a few agreements still to be worked out. I can name a couple of those. A parking deck construction agreement. A parking deck operating agreement. An intergovernmental financing agreement. An inter-creditor agreement which involves the city and his bank. Obviously, we need state and city sign-off on the environmentals. Those are all pretty big events to occur. I believe we have a long way to go. That area needs some economic encouragement. Whether this project is the right one, it is too early to tell.

    Q: What do you think of the reputation of the developer Scott Chappelle?
    A: That is part of the underwriting of the credit-worthiness of the developer. That is one of the things we will evaluate. If he has done similar kinds of projects before, if he has experience in these kinds of projects, if he has not been in bankruptcy recently, if he has good relations with his past developments, if he is able to get financing put together from the banks, are all good signs.

    Q: How much of a risk is it for the city?
    A: From a financial standpoint, we really need to have the chief financing agreements negotiated first before I could answer that. As a city taxpayer myself, I want to make sure it is a reasonable risk we could take.

    Q: What is an inter-creditor agreement?
    A: That is an agreement that outlines the roles and responsibilities and the liabilities of the city and the bank. We would outline what order of rights for claims.

    Q: What is a worst-case scenario? Could the city get stuck with a $40 million bill?
    A: If we had inter-creditor agreements where the city is solely on the hook and had no collateral except for the tax proceeds … [and] after the lease commitments expire … the value of the property [is] lower, the assessed property taxes would be lower and make it insufficient to pay off the bonds. That means the city would have to contribute. That is why it is important for us to carefully negotiate the inter-creditor agreement and understand the true cost of the project and underwrite the bond appropriately. We will be conservative in our estimate of tax revenue from the project.


       —David Cahill    Aug. 21 '06 - 06:07PM    #
  345. So, again it certainly looks like the city is carefully considering every aspect of the Broadway Village financing document. Nothing is going forward until they are confident that proper financial protections are in place and the developers hoped for $40 million loan to be paid off via TIF, is not in any way a sure thing. Why do we need CARD?


       —Dustin    Aug. 21 '06 - 08:36PM    #
  346. To make sure that the City staff keeps its promises?


       —David Cahill    Aug. 21 '06 - 11:09PM    #
  347. Thanks for posting the interview, David.

    “A: ...I believe we have a long way to go. That area needs some economic encouragement. Whether this project is the right one, it is too early to tell.”

    I’d be curious to kow what the developer thinks of this statement. While I appreciate that the city has a lot to consider, consideration seem to make up the bulk of what has happened so far. Why does this decision require this much time? Is there a target date for when this determination will be final?

    I’m not asking this because I think BV should be built as soon as possible. But I can’t help but think of Todd’s repeated highlighting of the costs of delays resulting from bureaucratic process. Given the proposed financing, the delays may come back to cost the city more through increased risk. At some point a definite answer, positive or negative, is better for the city and the developer, than a continually strung out process.


       —Scott TenBrink    Aug. 22 '06 - 02:11AM    #
  348. Thanks for posting the interview, David.

    “A: ...I believe we have a long way to go. That area needs some economic encouragement. Whether this project is the right one, it is too early to tell.”

    I’d be curious to kow what the developer thinks of this statement. While I appreciate that the city has a lot to consider, consideration seem to make up the bulk of what has happened so far. Why does this decision require this much time? Is there a target date for when this determination will be final?

    I’m not asking this because I think BV should be built as soon as possible. But I can’t help but think of Todd’s repeated highlighting of the costs of delays resulting from bureaucratic process. Given the proposed financing, the delays may come back to cost the city more through increased risk. At some point a definite answer, positive or negative, is better for the city and the developer, than a continually strung out process.


       —Scott TenBrink    Aug. 22 '06 - 02:11AM    #
  349. Thanks for posting the interview, David.

    “A: ...I believe we have a long way to go. That area needs some economic encouragement. Whether this project is the right one, it is too early to tell.”

    I’d be curious to kow what the developer thinks of this statement. While I appreciate that the city has a lot to consider, consideration seem to make up the bulk of what has happened so far. Why does this decision require this much time? Is there a target date for when this determination will be final?

    I’m not asking this because I think BV should be built as soon as possible. But I can’t help but think of Todd’s repeated highlighting of the costs of delays resulting from bureaucratic process. Given the proposed financing, the delays may come back to cost the city more through increased risk. At some point a definite answer, positive or negative, is better for the city and the developer, than a continually strung out process.


       —Scott TenBrink    Aug. 22 '06 - 02:11AM    #
  350. In the interview you posted the City CFO is straightforward with his answers. City Council members have repeatedly stated that they will only approve this if there is a financial benefit to the city. Mr. Cahill, your reply in 346 implies that there is a reason to be suspicious of city staff. This is a serious charge. Would you please supply a rationale for this suspicion and importantly, a motive for the suspected future misconduct by city officals.


       —Dustin    Aug. 22 '06 - 01:16PM    #
  351. Because City staff (including Crawford) are under pressure from their bosses to approve the project. Remember Greden’s February meeting?

    It’s great that Crawford essentially provided a checklist of staff tasks. We will be able to see if staff performed those tasks as the process continues.


       —David Cahill    Aug. 22 '06 - 03:44PM    #
  352. Mr. Cahill. By “bosses” are we to assume you are speaking of the council members? If so and given all of their statements to the effect that they will approve the project only if it means the city will benefit financially and that there is little to no risk, why would the council be exerting any pressure to approve this? They have certainly been taking their time. What would their motive be in wanting to approve this if it did not prove to be a wise investment?


       —Dustin    Aug. 23 '06 - 02:44AM    #
  353. The same people who are on Council now ignored the same kinds of concerns the staff is raising now (and raised then) when they approved this project in 2003 and 2004. Plus, Leigh Greden, the lawyer for the developer, is active in the woodwork.

    I fully expect Council to ignore staff this time around, as well. Of course, I could be wrong.


       —David Cahill    Aug. 23 '06 - 12:45PM    #
  354. Approving the project is much different than putting the city in financial trouble. Why would council do this? Are you suggesting a payoff is involved?


       —Dustin    Aug. 23 '06 - 01:38PM    #
  355. Let’s just say that Council’s past history does not fill me with confidence.


       —David Cahill    Aug. 23 '06 - 05:00PM    #
  356. “A group calling itself Citizens Advocating Responsible Development (CARD) started a petition drive… blah.blah,blah” D. Cahill

    “The group says it thinks the public should vote on… blah.blah,blah” D. Cahill

    “I just talked to a petition circulator who was at the Farmers Market… blah.blah,blah” D. Cahill

    “From what I know, the storm signals are flying at the staff level… blah.blah,blah” D. Cahill

    Let’s just say that ‘past history’ cuts both ways Mr. Cahill. You’ve been manipulating this conversation in any way you can. As if you should judge anything at all. You reinforce all of those lawyer jokes… and then some.


       —abc    Aug. 24 '06 - 01:54AM    #
  357. I have a question: has the city looked at getting a lean placed on the development’s title for the $40 million? The lean could be reduced each year by the difference in the taxes paid and the interest on the original $40 million.

    However, I’m still against this project even if a lean were issued (but at least I could live a litte better with it assuming a title lean.) Here is the reason why: Economic theory says that as long as the marginal cost of a service is recouped, the business is better off selling a product or service at less than the average cost of providing the item. So for example, in the case of a hypothetical person in Detroit who wants to fly Northwest to Orlando in March by walking up to the Northwest ticket counter just before take-off and offering an amount of say $100 for a one-way ticket on a flight the buyer knows is not full, Northwest should say “Yes”, in theory. However, we know what the real answer would be: (laugh, ha, ha from the ticket sales clerk) “Sorry sir, we don’t do that!”

    So, according to economic theory, Northwest is not being rational by turning down the request because they’re saying they would rather see the plan fly with one less person than allow our hypothetical passenger to board after paying the $100 dollars (we’ll assume the $100 more than offsets Northwest’s marginal cost of adding one more passenger.) Which leads to my main point, Northwest is in fact rational by turning down the offer. Everyone knows Northwest will not deal this way because it would open up the floodgates to people who would attempt this tactic all the time. By making a strong statement that this tactic will not work, Northwest defends their profit margin so our dreaming hypothetical passenger knows not to do anyting but wish s/he could get away with it. IF THE CITY APPROVES THIS DEAL, EVERY DEVELOPER WITH A SUBSTANTIAL PROJECT IS GOING TO DEMAND (AND PROBABLY GET) A HANDOUT FROM THE CITY.


       —Chuck    Aug. 24 '06 - 02:11AM    #
  358. Are you talking about the “never negotiate with hijackers” rule? Also, it’s spelled lien.


       —jcp2    Aug. 24 '06 - 12:02PM    #
  359. Here is today’s Ann Arbor News article about the project.

    It appears from Postema’s letter that the project is once again in serious trouble. Not only is there a big gap in the funding assumptions, but also Postema has rejected the background check materials the developer has provided!

    The saga continues…


       —David Cahill    Oct. 11 '06 - 08:39PM    #
  360. So let’s take the saga back a few months… Remember C.A.R.D. and the petitions to force a vote of the citizens and all the doomsday quotes in the media about how this was a corporate giveaway that was going to break the city’s bank?

    It looks like the city is right on top of this just as the mayor and council members, the CFO and the City Attorney have said all along.


       —Dustin    Oct. 11 '06 - 10:52PM    #
  361. I’ll be making a FOIA request for the stuff mentioned in the article, plus other materials. I’ll post relevant documents here, with Juliew’s help.


       —David Cahill    Oct. 11 '06 - 11:29PM    #