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Posted on Wed, Jun 6, 2012 : 3:48 p.m.

Ann Arbor DDA agrees to chip in $650K to help pay for streetscape improvements along South Main

By Ryan J. Stanton


Ann Arbor Mayor John Hieftje said he's glad the DDA can help support elements of the 618 South Main project but he didn't want to pay for items the developer normally would be responsible for.

Ryan J. Stanton |

The Ann Arbor Downtown Development Authority is agreeing to use its resources to help finance elements of the 618 South Main development.

The DDA's governing board voted 10-0 on Wednesday to provide $650,000 in matching funds for a brownfield grant application by the developers.

"This is going to dramatically improve Main Street and make it a much more pedestrian-friendly area, a much more pleasant area," said Mayor John Hieftje, one of the DDA's voting board members. "And I think it's going to help that neighborhood down there around the Washtenaw Dairy. It's a vital neighborhood now. It's just going to make it better."

Over several meetings, DDA officials reviewed and discussed a request from the developers for a DDA grant that would be used by the state as the local match for a brownfield grant.


A look at the 618 South Main proposal

They determined the project has many attractive elements, including that it addresses an underserved gap in the marketplace and could act as a catalyst for additional revitalization of the Main Street area just south of the core downtown area.

They also determined the project will add to downtown's residential density and that the environmental design of the project appears to exceed city requirements.

"By doing this, we're really able to leverage state funds and bring them back into the community," said DDA board member Sandi Smith.

"This is an area where we have not spent any resources in anybody's memory, so it is a spot within the DDA and a zone that has not been invested in," Smith said. "And this is really going to give us an opportunity to make a nice streetscape, activate the sidewalk, perhaps help other future developments come in, as well as help the retailers that already exist there."

According to a breakdown of the DDA grant, $384,500 will go toward streetscape costs for the Main Street sidewalk north of the project to Ashley Mews, $85,000 will go toward streetscape costs for the sidewalk adjacent to the project on Mosley and Main streets, and $100,000 will go toward a rain garden to keep stormwater from releasing into the city's storm sewers.

Additionally, $80,500 will go toward upsizing the water main under Ashley Street to a 12-inch pipe.

The streetscape improvements will touch only the western side of Main Street as part of the grant, and DDA officials are in the early stages of talking about how they might help facilitate streetscape improvements on the other side of the street.

"The one side will be dramatically improved and we'll have to take a look as time goes on what we could do with the other side," Hieftje said.

Project developer Dan Ketelaar of Ann Arbor-based Urban Group Development Co. is planning to demolish two existing structures and construct a seven-story residential building containing 190 apartment units, 121 underground parking spaces and 65 bicycle parking spaces.

During the course of the board's deliberations on Wednesday, what was expected to be a $725,000 grant was whittled down following concerns raised by Hieftje.

Hieftje said he was uncomfortable with $25,000 included for bank carrying costs and won support to remove that part. Following that vote, the board agreed to whittle from $135,000 to $85,000 the amount going toward streetscape costs adjacent to the project.

Hieftje said afterward he was satisfied that the grant was narrowed down so what remains are improvements above and beyond what the developer normally would be required to do. He noted it's a project with broad support, including from neighbors.

"I wanted to make sure we drew a pretty bright line in between helping the developer pay for things that would be required of any developer and actual improvements that weren't required," Hieftje said. "I don't want to spend it on things the developer would be required to do, but if we can enhance the streetscape of Main Street, and they get kind of a twofer that this helps them to receive some other brownfield funding from the state, I'm willing to vote in favor of that."

Hieftje stressed that the $650,000 is not money coming out of the DDA's pocket, but rather money the DDA wouldn't even have but for the development.

The developer of 618 South Main has estimated the portion of the new taxes generated by the project that will be captured by the DDA will be about $250,000 a year. The DDA plans to use a portion of those receipts to pay out the grant over four years.

The DDA's board also voted 10-0 on Wednesday to approve a recently developed brownfield grant policy that includes criteria for doling out grants like the one for 618 South Main.

If the city assessor determines that the taxes captured by the DDA from the proposed project are less than $250,000 a year, the DDA plans to reduce its grant proportionately.

The brownfield application for the proposed project at 618 South Main still must be approved by Ann Arbor City Council, the Washtenaw County Brownfield Redevelopment Authority, and the state of Michigan before the DDA's matching grant becomes effective.

The site plan for the project still hasn't been approved by the City Council. Should the council-approved site plan differ significantly from the plan the developer presented to the DDA, the DDA has reserved the right to adjust its grant accordingly.

The developer also is being asked to provide more detailed drawings for the streetscape improvements to be installed along South Main, north of the project to Ashley Mews, so it's more clear what the improvements will look like once installed.

"We're talking about sidewalk improvements, we're talking about plantings, maybe there'll be benches along there," Hieftje said. "There could be new street lighting, all sorts of things."

Added Hieftje: "There are a whole bunch of people who live and work in that area and they go back and forth all the time. We can make it much more inviting."

DDA Executive Director Susan Pollay now must work with the DDA's attorney to formulate a final agreement between the DDA and the developer of 618 South Main.

Ryan J. Stanton covers government and politics for Reach him at or 734-623-2529. You also can follow him on Twitter or subscribe to's email newsletters.



Thu, Jun 7, 2012 : 7:54 p.m.

Nice to see the DDA giving back. City needs to tap DDA funds for cleaning up the roads on the other side of main, at N. Main coming into town. In fact, that exit, like the US 23 approach to town, needs to be safer and widened coming off of 14 there, very unsafe if driver is unfamiliar with the exit. U of M should help pay for improving inroads into town as it looks bad for visiting NY'ers or otherwise checking U of M out. First impressions can be everything. Ann Arbor needs to keep promoting itself, and clean inroads and outroads would be a good start. Also, can we get a new bus station sign. that place is old, dirty and depressing.


Thu, Jun 7, 2012 : 2:37 p.m.

Why does Ann Arbor have a Downtown Development Authority? What is its chartered mission? What is the history of its inception and role as a quasi-governmental agency? Is it still relevant today? None of those questions are intended with any prejudice -- I honestly wonder why it exists, what it is supposed to do, and whether it efficiently and productively uses public money, and for what purpose.


Thu, Jun 7, 2012 : 5:09 a.m.

Why is the developer being asked to design the streetscape if he is not funding the project privately? What conditions would the design have to meet other than limiting the cost to $650,000? The DDA will have to await completion of the construction and the leasing of the apartments before any TIF revenue is produced. Will the streetscape be created only as TIF funds become available or will the DDA loan or grant the money to complete the entire streetscape at one time? And what if leasing does not go well and the entire project goes bankrupt? Where will the DDA find $650,000 to cover the streetscape expense since I do not believe that amount of unfettered cash is available now.

G. Orwell

Thu, Jun 7, 2012 : 1:03 a.m.

I hope they don't reduce the number of lanes to three to "calm the traffic" as one of the council members advocated for.

Jim Osborn

Thu, Jun 7, 2012 : 12:37 p.m.

If anyone wants to see how poorly a 4-lane to less lane conversion "calming fails to work, try to drive on Packard betweek Platt and US-23. A shape of things to come? Our elderly aunts who are in their 80s should be able to drive at their preferred pace,a nd the rest of us should not be upset at this, but able to go around, as we can with 4 lanes. 3 lanes does not "calm" but does the opposite, as these elderly drivers, who might want to go 25 or 30 MPH, are tail-gated by those who rather go the speed limit. I ride my bike far from congested roads such as Jackson.

Marvin Face

Thu, Jun 7, 2012 : 2:24 a.m.

Oh, I hope the do reduce it to three lanes. The three lanes would continue south from William to Stadium. It would be a major improvement.

Ron Granger

Thu, Jun 7, 2012 : 12:27 a.m.

So they'll kick this in like nothing. And yet when Earthen Jar and Jerusalem Garden need help due to the DDA's boondoggle parking structure project, they won't do anything.

Jim Osborn

Thu, Jun 7, 2012 : 12:31 p.m.

Hell will freeze over first. Now if either of these businesses were to install a bicycle rack outside...all bets are off.


Wed, Jun 6, 2012 : 11:17 p.m.

More Whirley Gigs?


Thu, Jun 7, 2012 : 1:40 a.m.

I hope so I like those and they are cheap.

Ricardo Queso

Wed, Jun 6, 2012 : 9:10 p.m.

$650K ... that ought to buy maybe one piece of art at city council pricing.


Wed, Jun 6, 2012 : 8:47 p.m.

So all of the private property in between will see improvements using tax dollars....can I get some to work at my place? I understand about Ashley Mews....that's low income housing....for Manhattan....


Wed, Jun 6, 2012 : 8:45 p.m.

So I can only assume that all of this improvement is around city owned government housing? I mean why else would the DDA and hizzonnor use tax money to make the sidewalks pretty?


Wed, Jun 6, 2012 : 9:30 p.m.

Uh to raise property values (that are taxable) and promote new development (also taxable). It is almost as if government - not just the private sector - could invest capital to improve its long-range cash flows. Wild idea, right!?!


Wed, Jun 6, 2012 : 8:35 p.m.

Can't wait!

Honest Abe

Wed, Jun 6, 2012 : 8:21 p.m.

"Chip in $650K". They make it sound like they are all going in on a pizza. What a joke!


Wed, Jun 6, 2012 : 8:12 p.m.

How noble of them to use OUR money to help pay for our improvements. They should give it all back and disband immediately.


Wed, Jun 6, 2012 : 9:29 p.m.

Actually, the money is bonded by the DDA against the future increase in property value from private development. It never was your money. Projects like this are actually win-win for taxpayers, neighbors, the city, and even private developers. There is no nobility in ignorance; either check your facts or check your righteous indignation.