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HomeMy WebLinkAboutPlanning Board Draft Minutes - Sale of City Hall 5 I Regular Meeting
� G LANSING PLANNING BOARD
October 3, 2017
6:30 p.m., Conference Room
Neighborhood Empowerment Center
600 W. Maple Street
x I MINUTES
1. OPENING SESSION
Mr. Ruge called the meeting to order at 6:30 p.m.
a. Present: John Ruge, Marta Cerna, Katie Johnson, Farhan Bhatti & Lynne
Martinez & Josh Hovey
b. Absent: Tony Cox
C. Staff: Bill Rieske & Susan Stachowiak
2. APPROVAL OF AGENDA— Mr. Ruge approved the agenda by unanimous consent.
3. COMMUNICATIONS — None
4. HEARINGS
Ms. Stachowiak announced that Z-6-2017, East of 809 Hickory Street
A. SLU-4-2017, 735 E. Hazel Street, Residential Use in the "I" Heavy Industrial District
Ms. Stachowiak said that this is a request by Funk Zone Investors, LLC for a special land
use permit to permit the conversion of the building at 735 E. Hazel Street into residential
apartments (maximum of 160 units). Residential use is permitted in the "I" Heavy Industrial
district, which is the zoning designation of the subject property, if a special land use permit
is approved by the Lansing City Council.
Ms. Stachowiak said that staff is recommending approval of SLU-4-2017. She said that the
site currently contains a vacant building that is in need of significant rehabilitation which
detracts, rather than contributes to the surrounding area. Ms. Stachowiak said that there
has been numerous special land use permits issued over the past several years to permit
residential use on industrially zoned properties and they have all had positive outcomes.
She said that, without the requested special land use permit, reuse of the building that is
the subject of this request would be difficult for anything other than warehousing, storage or
a grow facility, given its age and layout. The special land use, thus, allows for a higher and
better use of the subject property than what would be permitted as a matter of right.
Ms. Stachowiak said that the size of the site should be adequate to accommodate 160
units, depending on the number of units by bedroom count. She said that the applicant will
have to provide parking which is also determined by the number of units by bedroom count.
Mr. Ruge opened the public hearing.
Brent Forsberg, Funk Zone Investors, LLC, 2422 Jolly Road, Suite 200, Okemos, MI
48864, spoke in support of his request. He said that Reo Town has seen a great
resurgence in recent years and is within walking distance of the downtown, making 735 E.
Hazel Street a good location for residential use. Mr. Forsberg said that they intend to
Planning Board Minutes October 3, 2017 Page 2
preserve the historic character of the building which, at one time, housed the state treasury.
The residential component of the project will consist mainly of efficiency and 1-bedroom
units. The building will also contain nonresidential uses such as artist studios, makers
space, performance studios, etc. Mr. Forsberg said that there is a gym in the building that
they will put back into use. He said that the intent is to build connections. While the subject
property is an island in the middle of an industrial district, it is part of a much bigger plan to
revitalize the area.
Mr. Ruge said that this is an exciting project and the City needs artsy space and maker
space.
Joshua Aikens, 900 Hickory Street, stated that they want more residential use in the
area. He said that there needs to be a park for the children in the area and those that will
live in the building. Mr. Aikens suggested that the developer talk with the neighbors about
the development and what type of commercial uses would be appropriate.
Mr. Ruge asked that the neighbors speak with Mr. Forsberg after the meeting today.
Mr. Forsberg said that there have been a series of town hall meetings about this
development and other development of a similar nature in the City. He also said that he
would be glad to meet with the neighbors.
Laurie Kirk, 832 Hickory Street, stated that it is an exciting project and the neighbors
would like to be part of it. She said that they don't like losing green space but they would
like to be part of the planning.
Tiffany Aikens, 900 Hickory Street, stated that traffic is a concern as there are a lot of
children in the area. She said that she likes the proposed project but thinks that there are
things to consider such as speed bumps, community gardens, parks, etc.
Seeing no one else wishing to speak, Mr. Ruge closed the public hearing.
5. COMMENTS FROM THE AUDIENCE
Tiffany Aikens, 900 Hickory Street, said that she and the others in the audience originally
came to this meeting for the Hickory Street rezoning but are also interested in the Hazel
Street project as it is in close proximity to their neighborhood as well. She said that there is
a need for parks and community gardens in the area.
Joshua Aikens, 900 Hickory Street, Joshua Aikens, said that the downtown should be a
hot spot for activity and unfortunately it is not. He said that restaurants should not be
closing at 7:00. Mr. Aikens said that Ann Arbor is very vibrant in the evenings and on
weekends because they have the types of uses that attract people to the downtown. He
said the City should not have medical marijuana dispensaries all over the City. He also said
that the vacant buildings are a problem in the City and that is one of the reasons why he is
supportive of Mr. Forsberg's proposal for the Hazel Street property.
6. RECESS — None.
7. BUSINESS
A. Consent Items
Planning Board Minutes October 3, 2017 Page 3
1. Minutes for approval: August 1, 2017
Without objection, the August 1, 2017 meeting minutes were approved as printed.
2. SLU-4-2017, 521 E. Hazel Street, Residential Use in the "H" Light Industrial
District
Without objection, SLU-4-2017 was approved.
B. New Business
1. Act-6-2017 — Sale of City Hall, 124 W. Michigan Ave
Mr. Rieske said that this is a request to authorize the sale of the City Hall and Police
Building at 124 W. Michigan Avenue. He said that the plaza and the underground
parking would be included in the sale. He also said that city operations would be
relocated to an as yet undetermined location, and thus, the Act 33 review pertains
only to the sale of the property.
Mr. Rieske said that the City solicited and received four proposals for the sale and
reuse of City Hall and Police building, all four of which proposed a hotel on the site.
He said that there is a steering committee in place to review and select a proposal.
Mr. Rieske said that the current use as government offices is not the highest and
best use of the site. While city halls are traditionally located in central business
districts, they need not occupy the most prominent corner, especially with the
current market demand for more hotel space.
Mr. Rieske stated that the building was listed on the National Register of Historic
Places in 2009 as part of the Lansing Downtown Historic District, and was featured
in the study "Michigan Modern" by the Michigan State Historic Preservation Office.
He said that the City Hall Plaza is home to two State historical markers, which may
need to be relocated with the redevelopment of the property. He also said that the
acquisition of a replacement site for City operations will be the topic of a separate
Act 33 Review.
Mr. Rieske said that, based on a review of the location, character, and extent of the
proposal, staff recommends the following findings:
• The property is in the Lansing Downtown National Register Historic District,
thus making eligible for historic preservation tax credits of up to 20% of
qualified rehab costs. The National Register designation becomes regulatory
only if Federal Funds, including the tax credits, are involved in the project.
• City government is not the 'highest and best' use of the site. It does not
require or substantially benefit from views of the Capitol or easy walking
distance to the Lansing Center.
• The 'provision of public urban open space' was not included among the ten
objectives for the Capitol Vista Plaza site. The development proposals
therefore would substantially reduce the amount of public open space by
occupying most of the City Hall plaza, while addressing the ten objectives of
the RFP.
Mr. Rieske said that staff is recommending approval of the sale of the City Hall site,
with further recommendations that:
Planning Board Minutes October 3, 2017 Page 4
• The new owners will be responsible for maintaining the vault and the surface
above the vault, and indemnify the City for any harm coming from the failure
of the vault.
• The new owners either accommodate the historical markers on-site or work
with the City on their relocation.
Mr. Ruge said that city hall is a mid-century model building that has historical value
and none of the proposals are sensitive to retaining the historic character of the
building.
Mr. Rieske said that a bas relief of the former City seal on the west wall of the
building would be preserved in some of the proposals. He also said that the
Planning Board's role at this point is not determine the future reuse of the site but to
determine that city hall is not the best use of the site and that it can be relocated to a
site, albeit undetermined at this time, that is more practical for its use.
Ms. Johnson asked if the sale is contingent on finding an appropriate location for a
new city hall. She also asked if the reuse of the property would be strictly offices or
could it include some commercial or residential uses as well.
Mr. Rieske said that all four proposals included a hotel but incorporating other uses
such as restaurants and retail would help to enliven the area on Michigan between
Capitol and the Lansing Center.
Ms. Martinez said that there does not appear to be any recommendations as to
where the new city hall would be located. She asked if the area at Holmes and
Pleasant Grove is being considered.
Mr. Rieske said that a new city hall would need to be located in the downtown area.
Mr. Hovey asked about the Lake Trust site.
Mr. Rieske said that there has been talk about the Lake Trust site as a potential
location for a new city hall.
Ms. Martinez said that this project requires long term leadership to see the sale and
reuse of the current city hall and the selection of a new site and development of a
new city hall through to the end. She said that we are just a month away from an
election that will result in changes to the City's leadership as we will be getting a
new mayor and at least one new council member. Ms. Martinez said that this
seems like an odd time to be bringing this forward.
Dr. Bhatti said that this is a good time to get something of this nature done because
it relieves the next administration of the political pressure that comes with these
types of decisions. He said that given number of upcoming changes to the City
leadership, if the City does act to begin the process of selling city hall now, it could
delay it for a very long time and it is the right thing to do.
Ms. Martinez asked how this can move forward without conducting a cost-benefit
analysis to determine to determine what is in the best interest of the City with regard
to renovating the existing city hall or building on a new site.
Planning Board Minutes October 3, 2017 Page 5
Dr. Bhatti said that there are many steps involved in selling the existing city hall and
building a new one elsewhere. He said that most of it will take place under the new
leadership but this gets the process started.
Mr. Ruge said that the Planning Board needs to consider what is in the best interest
of the City and not just from a monetary standpoint.
Mr. Rieske said that the Board needs to consider whether it is necessary for city hall
to be located right across the street from the State Capitol building when there are
other uses that may be more appropriate at that location.
Mr. Ruge said that his concern is that not much planning appears to have gone into
this idea. He said that city hall is old but that nothing has been provided to indicate
that it is in the best interest of the City to move rather than renovate the existing
building. Mr. Ruge asked about the cost of rehabbing the building in comparison to
the cost of constructing a new building.
Mr. Hovey stated that the Board is not authorizing a specific deal for the sale of city
hall. It is just allowing the City to market the property for sale so that it can consider
its options. He said that there will be a separate Act 33 application for acquisition of
the new site. Mr. Hovey said that since this just an application to list the property for
sale, he does not see a reason to delay the approval as it could takes several
months for it to get any traction with all of the new elected officials that will be
coming on board soon. He said that the downtown needs a shot in the arm and this
is just the first step in determining the best use of the city hall property. The Mayor
and the City Council would both have to approve the sale of the property. This just
allows the City to begin the process of listing the property for sale.
Dr. Bhatti stated that he is in favor of moving this process forward so that the City
can explore options for reuse of the existing city hall property and locations for a
new city hall. He said that this matter will come back to the Planning Board to
authorize the purchase of property for a new city hall.
Ms. Martinez asked if the City Council will also have to approve the authorization to
sell city hall.
Mr. Venker said that the Planning Board's decision is advisory and Council will have
the final authority as to whether to approve this Act case to market city hall for sale.
Mr. Rieske said that this will also require a public hearing at the City Council level.
Mr. Venker said that he assisted in preparing the "request for proposals" documents
for reuse of city hall. He said that it has been determined that the cost to renovate
city hall is about sixty million dollars. Mr. Venker said that the primary concerns with
the existing city hall is security as it houses the courts and the jail without much
separation from the rest of the city hall operations, there is a lot of unused space,
and parking is often a problem. He said that any proposal has to include a plan for
a new city hall. Mr. Venker stated that city hall does not maximize use of the
property given its location in the downtown. The question, in part, is how much is it
worth as a hotel, particularly since the Radisson has a monopoly on hotels in the
downtown. It is a good opportunity for development in the downtown and a good
opportunity to get a proper location for city hall.
Planning Board Minutes October 3, 2017 Page 6
Mr. Ruge asked about the cost of a new city hall.
Mr. Venker said that there are no firm numbers but it would be significantly less than
sixty million dollars.
Mr. Hovey said that it cost forty million to renovate the Knapp's building as it is
always more expensive to renovate and maintain the historic character of an
existing building than it is to build new.
Mr. Ruge said that he has the same concerns about this proposal as did with the
BWL substation in that is another instance of losing historic resources in the City.
He said that the City does not respect its history.
Ms. Cerna said that other communities have downtowns that are thriving and not
just during the work day but in the evenings and on the weekends as well. She said
that she likes the idea of a hotel and relocating city hall to a location that is more
practical and functional.
Ms. Johnson said that she agrees with Ms. Cerna that a hotel seems like a good
use of the existing city hall property. She also said that she is comfortable with
moving this process forward, particularly since the acquisition of property for a new
city hall will have to come back to the Planning Board for its recommendation.
Ms. Martinez said that the Board can also provide its comments or concerns directly
to the City Council so that they can take them into consideration when making its
decisions.
Mr. Ruge said that he is not going to entertain a motion as there is too much
information missing and too many unanswered questions.
Mr. Hovey said that if one of the Board members makes a motion and it is
supported, the Board has to vote on it. He also said that the question is whether the
current location is the best location for city hall. Mr. Hovey said that it is a tired
building that does not function very well for a city hall with a police station, jail and
courts. He said that he is confident that there will be a cost-benefit analysis
conducted by the City before any final decisions are made. Mr. Hovey stated that it
will be more efficient to build a new city hall than to renovate the existing one and
utilizing the space for a hotel and other commercial uses would be a significant
benefit to the downtown. He said that it is not essential that city hall remain in its
current location but it should still be located in the downtown. He also said that he is
supportive of authorizing the sale of the property.
Mr. Rieske said that an Act 33 review is required for the sale and for the acquisition
of property by the City.
Dr. Bhatti said that he agrees with Mr. Hovey that it is not necessary for city hall to
be in its current location as it is diffident for citizens to access, parking is
inconvenient and inadequate and there is no separation between the jail, courts,
police department and the city administrative offices. He said that he is comfortable
with voting to approve the sale as no city official is going to marry the City to a deal
that is not in the best of the City. Dr. Bhatti said that he is excited about the
economic benefit to the City that would be generated by the reuse of the property for
Planning Board Minutes October 3, 2017 Page 7
a hotel and other commercial uses. He said that city hall should not be occupying
such prime real estate in the downtown.
Mr. Rieske said that the motion should include a recommendation that the City
consider alternative locations for a new city hall in the downtown that is easily
accessible to the public and has adequate and convenient parking.
Dr. Bhatti made a motion, seconded by Mr. Hovey to recommend approval of Act-
6-2017, to approve the sale of the current city hall site, 124 W. Michigan Avenue,
with further recommendations that:
• The new owners will be responsible for maintaining the vault and the
surface above the vault, and indemnify the City for any harm resulting
from the failure of the vault.
• The new owners either accommodate the historical markers on-site or
work with the City on their relocation.
• Alternative locations for a new city hall in the downtown should
consider adequate parking and ease of access for the public.
On a voice vote, the motion carried 5-1. Mr. Ruge cast the dissenting vote.
Ms. Martinez said that this is all about visitors to the city and part of what is working to
make the area east of Cedar Street on Michigan Avenue vibrant is the entertainment
venues which draw people that already live in the City to the area beyond normal
working hours. She said that the area west of Cedar Street cannot continue to depend
on hotel guests to keep that area vibrant in the evenings on weekends so there needs
to be more to the reuse of city hall than just a hotel.
2. Act-1-2017 —240 Museum Dive, Convey to RE Olds Museum
Mr. Rieske said that this is a request to authorize the conveyance of the R.E. Olds
Transportation Museum property at 240 Museum Drive to the Museum. He said that
the Museum has been operating in the building since the opening of the Museum in
May, 1981. Mr. Rieske stated that the property is not dedicated park land. He also said
that the sale is in the best interest of the City because it will continue to be used for a
museum and the City will no longer incur the expenses associated with maintaining the
property.
Mr. Rieske said that staff is recommending approval Act-1-2017 to recommend the
conveyance the R.E. Olds Transportation Museum at 240 Museum Drive to enable the
continuation of the property's function as a museum under private ownership, and to
further recommend that the City vacate the west 12 feet of the Museum Drive (Mill
Street) right-of-way adjacent to the building to accommodate roof drains, the building's
HVAC system, and landscaping and to reserve a 20 foot wide easement at the north
end of the property for the 36" storm sewer that runs under the parking lot, based on the
following findings:
• The property need not be under City ownership to house a transportation
museum,
Planning Board Minutes October 3, 2017 Page 8
• The draft purchase agreement contains a reveter clause, which also
ensures continued use as a transportation museum,
• The property consists primarily of the building, accessory parking, and a
front lawn. The legal description excludes:
o the RiverTrail and all river frontage,
o the bench/table at the west and of the parking lot,
o and the sanitary sewer siphon on the City's Central Interceptor,
• The purchaser has the obligation to relocate the eighteen (18) inch storm
drain traversing beneath the southern section of the building located on the
property, and/or accommodate storm sewer improvements as determined by
the Public Service Department,
• The property is located in the Grand River floodway,
• Any effect of the transaction on the location, character, and extent of the
property is likely to be negligible; and
Dan Danke, Project Engineer, City of Lansing Public Service Department,
explained the need for the various easements listed in the staff report.
Mr. Hovey made a motion, seconded by Ms. Martinez to recommend approval
of Act-1-2017 to convey the R.E. Olds Transportation Museum at 240 Museum
Drive to enable the continuation of the property's function as a museum under
private ownership, and to further recommend that the City vacate the west 12
feet of the Museum Drive (Mill Street) right-of-way adjacent to the building to
accommodate roof drains, the building's HVAC system, and landscaping and
to reserve a 20 foot wide easement at the north end of the property for the 36"
storm sewer that runs under the parking lot, based on the following findings
of fact as outlined in the staff report. On a voice vote, the motion carried
unanimously (6-0).
8. REPORT FROM PLANNING MANAGER
Mr. Rieske said that several meetings have been conducted to obtain input on the proposed Form-
Based Code, including one at city hall, one in each ward and a meeting with local developers,
realtors and design professionals. He said that the City partnered with "Shaping the Avenue" on
their presentation at city hall. Mr. Rieske said that Joe Maguire, whose family has been in the
gasoline station business for decades, expressed concerns about the "gas backwards" approach
and stated that it simply does not work for gas stations. Based on those concerns, the City is
going to change the proposed code to only require that design for gas stations in the area that are
overlay districts right now and in some other limited areas of the City as well. Mr. Rieske also said
that the code will offer incentives for universal design to provide for barrier-free units.
Mr. Rieske said that the City sought but did not received much input on the code as none of the
meetings were very well attended. He said that the City will continue to seek public input via a
public hearing at the City Council level in the next month or so.
9. COMMENTS FROM THE CHAIRPERSON - None
10. COMMENTS FROM BOARD MEMBERS
Ms. Martinez asked how Mr. Elliot's new restaurant on E. Michigan Avenue was allowed to get built
given the lack of parking.
Planning Board Minutes October 3, 2017 Page 9
Ms. Stachowiak said that it is in the E. Michigan Avenue overlay district so he was only required to
provide 20% of the parking that would be required if it were located outside of the overlay district
and he has provided that behind the building.
Ms. Martinez said that parking is going to be an issue for the business and the concern is that the
patrons will use the on-street parking in the neighborhood.
11. ADJOURNMENT— Mr. Ruge adjourned the meeting at 8:03 p.m.