Ann Arbor City Council: March 17, 2025

Mar 17, 2025 | City Council

Arbor South | Avalon | Bicentennial Park | Design Review Board | Fire Department | Fire Station 4 | Oxford Properties | Pinball | SEU | UDC Updates

This Ann Arbor City Council meeting was held in person at City Hall. Members of the public can participate in public hearings and public comment either in person or via phone.

Due to CTN technical issues, no video was broadcast for this meeting
CM Harrison was absent

Legistar
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Ann Arbor City Council Meeting Summary

POSTPONED: By resolution, the City Administrator would be directed to enter the “next stage” of negotiation with the developer Oxford Companies in order for the City to fund the construction of parking decks at a private development called Arbor South. Approval of this resolution would lead to the negotiation of agreements, preparation of bond issuances, and special assessment districts for the Arbor South development that Council would need to approve at a later date. (Legistar)

  • Included in the resolution is a memorandum explaining how City participation is necessary in order to generate adequate “return on equity” (ROE) and adequate “internal rate of return” (IRR) for the developer. In other words: the City investment is necessary to subsidize profitability for the investors and owners of Arbor South. With City support, the internal rate of return for Oxford is predicted to be 16.06%.
  • As explained in a report attached to this weeks resolution (link): “the Developer’s request of the City’s participation via the financing of the structured parking elements of the proposed Southside Redevelopment by the City is necessary to meet the typical investment hurdle for a multi-phases mixed-use project.”
  • City-subsidized parking decks would require the issuance of an estimated $146 million in bonds. The City would purchase land from the private developer, cover the cost of construction, and assume ownership of the decks. City ownership will reduce future tax liability for the private developer. The City would be responsible for an estimated annual cost of $1.9 million to operate the decks, potentially covered by whatever income might be generated from user fees.
  • The report explains: “A City-financed structured parking facility as initially proposed provides the project the lowest cost of capital and reduces the net operating costs of the structured parking by eliminating property taxes on the structured parking. However, in the City-financed option, the City is taking on the project risk such that if the parking garage [net operating income] and [tax incremental financing] revenue is not sufficient to cover the debt service, the City’s general fund represents the source of payment for the shortfall.”
  • The report calculates relative advantage to the City in terms of potential net operating revenue for the garages and future tax revenue from the Arbor South development covering the cost to service the debt (bonds).
  • You can learn more about South Arbor and watch a public engagement meeting for the development that was held in January 2024: https://a2council.com/777-e-eisenhower-oxford-resident-participation-meeting-january-9-2024/
  • https://www.mlive.com/news/ann-arbor/2025/03/469m-ann-arbor-development-seeks-big-tax-capture-to-help-make-project-happen.html
  • In November 2024, City Council heard presentations regarding public subsidy of these parking decks to meet the needs of the planned Arbor South development. You can watch a summary of that meeting here:

APPROVED: The City Administrator is directed to negotiate with a developer in support of constructing 35 single family homes at 2857 Packard. (Legistar)

APPROVED: The city will issue $12,000,000 in capital improvement bonds to finance construction, furnishing, and equipment to replace Fire Station No. 4 on Huron Parkway. The facility will be net-zero and include geothermal heating and cooling, solar panels, and energy-efficient design. (Legistar)

APPROVED: A construction contract for $10,630,000 will build a new net-zero Fire Station 4 on Huron Parkway. (Legistar)

APPROVED: A property at 1146 S. Maple Road is rezoned to Planned Unit Development (PUD). The 1.2 acre parcel was recently annexed into the City and sold to Avalon Housing for the development of Hickory Way III, an affordable housing project. (Legistar)

APPROVED: A site plan for Hickory Way III for a four-story, 39 unit affordable housing apartment building with a 20 space surface parking lot. There will be elevator access to upper floors. All units will be one-bedroom, 652 Sq ft. (Legistar)

APPROVED: $1,270,322 contract with Michigan Recreational Construction, Inc. for Phase 1A of the Bicentennial Park Splash Pad and Playground Improvements Project. (Legistar)

  • In September 2023, Council approved renaming of the Southeast Area Park to Bicentennial Park. https://a2council.com/ann-arbor-city-council-september-18-2023/
  • In January 2024, Council approved a $757,664.29 purchase of splash pad and playground equipment from Penchura, LLC. According to this week’s resolution, this equipment is stored at the Wheeler Service Center, awaiting installation. https://a2council.com/ann-arbor-city-council-january-22-2024/
  • Construction will be performed in two phases due to lack of funding. From the resolution: “Funding for construction of Phase 1A of the project is available through grant dollars, private donations and the Parks Memorials and Contributions Fund developer contributions, and Phase 1B will proceed after funding becomes available”
  • Phase 1A includes “installation of the splashpad, replacement of the playground equipment and swings, restroom renovations, and enlargement of the detention basin.” Phase 1B includes “construction of concrete curbs and sidewalks, seeding of the bioretention basin, installation shade sails, and restoration of the site due to construction activities.”
  • https://www.mlive.com/news/ann-arbor/2025/03/splash-pad-construction-set-to-begin-in-ann-arbor-with-13m-contract-okd.html

APPROVED: A class action lawsuit reaching back to 2019 is finally settled. If you or anyone you know ever parked a car in Ann Arbor and had tires chalked by the Ann Arbor Police Department, you may be eligible to receive an award of $1! (Legistar)

APPROVED (First Reading): Ordinance amendments will update standards for Fire Prevention from 2015 International Fire Code (IFC) to the 2021 edition of IFC. References to the 2015 IFC will be changed to 2021 IFC. Changes highlighted by staff include stricter provisions for fire safety in high-rise buildings, new technology integrated into communication systems, new measures to balance fire safety with security concerns (door-locking), and guidelines for green building materials to mitigate fire hazards. (Legistar)

APPROVED (First Reading): An ordinance will be added to City code, in order to establish a Sustainable Energy Utility (SEU). The SEU will be an opt-in, fee-based supplemental energy utility to provide renewably-sourced energy and other energy-related services in the City. The ordinance establishes a governing structure, rules and regulations for the SEU. (Legistar)

  • An Enterprise Fund will be established in order to finance any improvements. This fund will account for operations so that costs will be recovered from customer charges. City Council will set rates and charges.
  • Facilities and infrastructure built and purchased will be owned by the City of Ann Arbor
  • The City administrator will appoint a director tasked with planning and coordinating with City departments (Public Works and Office of Sustainability & Innovations), submitting annual reports, and meeting state and federal regulatory requirements

APPROVED (First Reading): Ordinance amendments will remove specific use standards of “general entertainment” currently described in the Unified Development Code (UDC). Two named uses – enclosed theaters (600 seat maximum) and pinball parlors – would be removed from the code and allowed in all districts where “general entertainment” is permitted. Currently both theaters and pinball parlors are restricted to only Campus Business zoning districts. With amendments, they would be permitted as a primary use in commercially zoned districts, downtown districts, and transit corridor districts. (Legistar)

APPROVED (First Reading): Ordinance amendments will remove the design review board as part of the approval process for new developments. As it currently exists, the Design Review Board is meant to “foster excellence in the built environment” specifically downtown. It advises developers on how to meet Downtown Design Guidelines. The Board also advises Council on recommended changes to the Downtown Design Guidelines. Membership includes significant expertise: 2 members shall be landscape architects, 2 members shall be architects, 1 shall be an urban planner, 1 shall be a developer, and 1 shall be a construction contractor. The Board is advisory and consults with developers in public meetings held once a month. Amendments will dissolve the Design Review Board and delegate their review to City staff. As described, the intent is “alleviate any undue burden on the land development that may be caused by city inefficiency.” A second ordinance change will permit the use of exterior insulation finishing systems, currently “prohibited on facades visible from primary and secondary streets.” (Legistar)

  • DEFEATED: An amendment to remove references to exterior insulation finishing systems until Council could receive more information about it.
  • The dissolution of the Design Review Board is consistent with recommendations offered by former Assistant City Administrator John Fournier in 2023 in a report titled “A New Approach to Economic Development” (link)
  • Among his recommendations (page 48): “The utility of the Design Review Board is debatable…. It delays review of the site plan documents and extends the overall approval timeline… the review from the Design Review Board rarely uncovers missed opportunities for favorable design changes… As these meeting are held in compliance with the OMA, city planning staff must notice and advertise them, prepare agendas and packets, attend them, compile minutes from them, and document the comments of the board members…several hours [of staff time] for each meeting per staff member— and this is time that is taken away from a planner actually working on site plan review and seeing it through to completion, which is what their focus should be.”
  • Fournier’s recommendations – to accelerate approval time and remove review and public hearing procedures for new developments – were, by resolution, unanimously approved by City Council in April 2024. (Legistar)
  • These amendments were approved by the Planning Commission on February 19, 2025. https://a2council.com/ann-arbor-city-planning-commission-february-19-2025/

A2ELNEL Voting Chart

Ann Arbor City Council Voting Chart for March 17, 2025 Part 1
Ann Arbor City Council Voting Chart for March 17, 2025 Part 2
Ann Arbor City Council Voting Chart for March 17, 2025 Part 3

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