City Council Meeting – September 28, 2010
Michelle McClellan, 232 Jefferson Street, Chelsea
Thank you for the opportunity to speak tonight. My name is Michelle McClellan, and I am a Chelsea resident, as well as a history professor at the University of Michigan and the current president of the group Preservation Chelsea. I also have the privilege of serving on the Chelsea First Advisory Committee, where I represent the domains of history and historic preservation.
Historic architecture is a key ingredient in making Chelsea a charming place to live. It connects us to the history of Chelsea, to the people who have come before, and it anchors us to this place, whether we are long-time residents or relative newcomers. It is also a very important economic resource. For these reasons, I am here to advocate for the preservation of the buildings known as the Longworth Complex.
Some of you attended the public presentation by Ed McMahon, a nationally known expert on sustaining livable and prosperous communities. I’d like to thank Bob Pierce, the Chamber of Commerce, and others who brought such a dynamic and engaging speaker to our community.
According to McMahon, community differentiation is an important concept in economic development. What makes your town special?
In Chelsea we are fortunate to have many resources which enrich our lives as residents and which have huge potential to draw tourists. In particular, we have a very powerful 1-2 punch of natural and historic assets, with a charming downtown that also functions as a gateway to the Waterloo State Recreation Area. We need to be stewards of both sorts of resources to ensure our quality of life and to leverage their economic potential.
The buildings of the Longworth Complex, unique in appearance, exemplify McMahon’s points about the importance of keeping what is special about your town. The historical importance and structural integrity of the entire complex have been found to be significantly greater than initially realized – certainly greater than is apparent with a casual glance at their current condition.
In fact, these buildings have received national recognition for their historic significance. That recognition, in turn, can open the door to financial tools, including tax credits and grants which, along with in-kind contributions and venture capital, can make the rehabilitation of these buildings economically viable. The Chelsea Connection Team has proposed structuring a partnership or purchase agreement with the DDA that would allow us to take full advantage of these financial tools to rehabilitate the buildings.
Rehabilitation, rather than demolition, will lead to long-term economic benefits for our community.
First, the process of rehabilitation itself functions as an economic engine. As compared to demolition or new construction, rehabilitation is more labor-intensive. That is a good thing, particularly in a recession. Rehabilitation creates jobs. With a higher proportion of the money spent on labor, the dollars circulate longer in the community. Dollars spent on materials circulate once. Dollars spent on labor can circulate locally up to six times, according to economic development expert Donovan Rypkema.
Second, once the rehabilitation is complete, this unique venue will add to Chelsea’s brand identity. One of the main goals of the Chelsea First Marketing Initiative is to promote Chelsea as a destination, and to my mind, rehabilitating the Longworth Complex aligns perfectly with that goal. It also follows the advice of Ed McMahon to use what you have, enhance your particular assets, and protect community character.
We know that tourism is a critical sector for the state of Michigan, and also for the Chelsea area. Heritage or cultural tourists – those who visit a place because of its historic attractions and ambience – stay longer and spend more.
As you know, this issue has galvanized a lot of citizen involvement. I deeply regret that this situation has given rise to animosity, since that was never our intent. The necessary constraints of a formal RFP process may well have impeded certain kinds of dialogue. I still believe that working together can turn these buildings into a wonderful asset for our community.
Thank you.
Information on Ed McMahon: http://www.uli.org/sitecore/content/ULI2Home/ResearchAndPublications/Fellows/McMahon.aspx
The Economics of Historic Preservation, Donovan Rypkema
http://www.placeeconomics.com/index.html
Thursday, September 30, 2010
Public Comment City Council 9.28.10
City Council Meeting, Public Participation, September 28, 2010
My name is Jane Creswell. I live at 131 E. Middle Street.
I am a fourth generation resident of Chelsea. My great-grandfather was a blacksmith and was one of the founders of what is now St. Paul’s church. My grandfather was a pharmacist, photographer, engraver, and businessman who was very active in the village government and the school board. Both my parents were born and raised here and I came back a few years after graduating from college to live here. My husband chose to live here—and that wasn’t easy—he’s from Texas and they don’t often leave Texas for good……….Bottom line—I love Chelsea and I‘ve seen it go through many changes over the years. When I was young, Chelsea was a farming community and also a very active industrial community. During those times the downtown was made up of businesses that supported the people who worked in the businesses and the vehicles in town were mostly pickup trucks, not BMW’s. It went through a frightening time as the farms and the industries began to disappear and change. We survived by going with the changes. We lost our corner drug store, in favor of a coffee shop. We lost small businesses when chains began to develop south of town. We started to see new businesses such as gift shops and art galleries. We’ve become a downtown that caters to the casual visitor who wants to get a bite to eat and stroll the historic downtown, perhaps see a play. This is a good thing because tourism is big and historic tourism is bigger.
Ed McMahon stated that tourism is the biggest industry in the world in his Sept. 15 speech. Michelle has already told you about Ed McMahon so I won’t describe him further. If you haven’t had a chance to see the presentation, it is airing on Channel 18 and there is a DVD that will be available for viewing. The presentation was amazing.
There was much that applied to Chelsea as it moves forward. The title of his talk was “The Dollars and SENSE of Protecting Community Character”. One of the questions he asked was “What makes your hometown different than other places? Historic preservation physically connects us to a place. It identifies us as who we are.” He also said “If every place was just like the other place, then there would be no reason to go anywhere”. He said parking is the biggest myth. Buildings are good neighbors— not parking. “Tourists won’t go to a town that lost it’s soul.”
Why am I telling you this? Over the last year I have been working with a talented group of volunteers who have been trying to find a way to save the buildings in the Longworth complex. At first, I just didn’t want to see 100 year-old buildings knocked down. With what our group has learned I now feel we would be losing far more than the buildings. We have learned that the Livery portion of these buildings—by it’s existence and placement next to the first hotel (which is now the Farmer’s Supply) and the depot –is unique, not just to Chelsea but in the state and maybe in the country. That makes Chelsea unique. Tourists will come to visit and see these buildings. It makes the “Jackson Street Corridor” an amazing focal point for tourism. To tear down the livery and replace it with a parking lot wouldn’t make economic sense in the long run. We have a spectacular asset in these buildings that we didn’t realize we had. McMahon stated that “How much something costs is NOT the most important question. The most important question is what should we do?” Historic buildings are a scarce resource and we should cherish and protect them. McMahon suggests that any building that was built before the World War should not be torn down.
Our group submitted an RFP to the DDA with an “out of the box” proposal that would allow these buildings to be saved without any more money being spent on them by the city. It was rejected and the demolition has been scheduled. We are here to ask that you utilize your authority to stop the demolition, ask that work be stopped on the due care plan for the demolition and allow time for you to research what an asset we have and determine how best to proceed. We are here tonight and can answer questions. We have a great deal of information we would be happy to share. McMahon stated that working together creates the most successful communities. Our desire is to work together to preserve our history and retain our uniqueness so we can move forward to the future. Our ancestors left us their legacy in their buildings and their history. It’s up to us as caretakers to make sure it isn’t lost or thrown away. It makes economic sense. It’s more sustainable. It’s a win/win situation.
Thank you.
My name is Jane Creswell. I live at 131 E. Middle Street.
I am a fourth generation resident of Chelsea. My great-grandfather was a blacksmith and was one of the founders of what is now St. Paul’s church. My grandfather was a pharmacist, photographer, engraver, and businessman who was very active in the village government and the school board. Both my parents were born and raised here and I came back a few years after graduating from college to live here. My husband chose to live here—and that wasn’t easy—he’s from Texas and they don’t often leave Texas for good……….Bottom line—I love Chelsea and I‘ve seen it go through many changes over the years. When I was young, Chelsea was a farming community and also a very active industrial community. During those times the downtown was made up of businesses that supported the people who worked in the businesses and the vehicles in town were mostly pickup trucks, not BMW’s. It went through a frightening time as the farms and the industries began to disappear and change. We survived by going with the changes. We lost our corner drug store, in favor of a coffee shop. We lost small businesses when chains began to develop south of town. We started to see new businesses such as gift shops and art galleries. We’ve become a downtown that caters to the casual visitor who wants to get a bite to eat and stroll the historic downtown, perhaps see a play. This is a good thing because tourism is big and historic tourism is bigger.
Ed McMahon stated that tourism is the biggest industry in the world in his Sept. 15 speech. Michelle has already told you about Ed McMahon so I won’t describe him further. If you haven’t had a chance to see the presentation, it is airing on Channel 18 and there is a DVD that will be available for viewing. The presentation was amazing.
There was much that applied to Chelsea as it moves forward. The title of his talk was “The Dollars and SENSE of Protecting Community Character”. One of the questions he asked was “What makes your hometown different than other places? Historic preservation physically connects us to a place. It identifies us as who we are.” He also said “If every place was just like the other place, then there would be no reason to go anywhere”. He said parking is the biggest myth. Buildings are good neighbors— not parking. “Tourists won’t go to a town that lost it’s soul.”
Why am I telling you this? Over the last year I have been working with a talented group of volunteers who have been trying to find a way to save the buildings in the Longworth complex. At first, I just didn’t want to see 100 year-old buildings knocked down. With what our group has learned I now feel we would be losing far more than the buildings. We have learned that the Livery portion of these buildings—by it’s existence and placement next to the first hotel (which is now the Farmer’s Supply) and the depot –is unique, not just to Chelsea but in the state and maybe in the country. That makes Chelsea unique. Tourists will come to visit and see these buildings. It makes the “Jackson Street Corridor” an amazing focal point for tourism. To tear down the livery and replace it with a parking lot wouldn’t make economic sense in the long run. We have a spectacular asset in these buildings that we didn’t realize we had. McMahon stated that “How much something costs is NOT the most important question. The most important question is what should we do?” Historic buildings are a scarce resource and we should cherish and protect them. McMahon suggests that any building that was built before the World War should not be torn down.
Our group submitted an RFP to the DDA with an “out of the box” proposal that would allow these buildings to be saved without any more money being spent on them by the city. It was rejected and the demolition has been scheduled. We are here to ask that you utilize your authority to stop the demolition, ask that work be stopped on the due care plan for the demolition and allow time for you to research what an asset we have and determine how best to proceed. We are here tonight and can answer questions. We have a great deal of information we would be happy to share. McMahon stated that working together creates the most successful communities. Our desire is to work together to preserve our history and retain our uniqueness so we can move forward to the future. Our ancestors left us their legacy in their buildings and their history. It’s up to us as caretakers to make sure it isn’t lost or thrown away. It makes economic sense. It’s more sustainable. It’s a win/win situation.
Thank you.
City Council public comment 9.28.19
My name is Ryan Beekman, and I live at 208 South Street--commonly known as the Glazier House.
Why demolish the Longworth Complex now?
Why demolish the Longworth Complex now?
Friday, September 24, 2010
Quote from Ed McMahon (link to his speech on right side bar)
A Chelsea Connection team member drove Mr. McMahon to the Longworth Property while he was in town. When he learned of the impending demolition, Mr. McMahon said, "It's stupid!"
Friday, September 17, 2010
Points sent to each City Council Member, p 1
City Council Points September 12, 2010
The following are some ideas for halting demolition on the Livery and Daniels Showroom:
Financial Reasons/Fiscal Responsibility
- From a fiscal standpoint we feel that for the DDA to purchase these buildings for more than their appraised value and then turn around and tear down ½ to 2/3s of the complex is fiscally negligent and irresponsible.
- We feel that this it is not fiscally responsible of City Government or the DDA to demolish nationally significant historic buildings for a parking lot.
- The potential taxes that could be collected from the Longworth Complex as businesses would be roughtly . As a parking lot/sitting/entertainment area, it would bring $0 in taxes and would cost the city approximately to maintain.
- Three serious potential buyers have been interested in these buildings, but were chased away by the price that the DDA was asking to purchase these buildings and/or by the cost of sanitary sewer/water hookup fees.
- The DDA wants a buyer to pay $400,000 to purchase these buildings, but no one could get a mortgage for that amount, because the appraised value is only $300,000.
- When the DDA is quoting their renovation costs compared to our renovation costs they are not comparing apples to apples. They keep quoting the much higher cost of a “full fit out”, as opposed to the cost of “white-boxing” all the buildings. This helps to support their argument that they cannot “afford” to renovate these buildings.
- The DDA has continued to misrepresent the cost of reusing these buildings. A local builder has studied these buildings and has quoted a significantly lower price to stabilize and do any necessary repairs on the buildings. The following are his quotes
Charlie Shiver’s original quote for restoration and white-boxing the entire facility (all three buildings) was $800K. In a subsequent evaluation, Charlie estimated $500K to restore and white-box the Livery by itself. This included all new structural work for the roof and 2nd floor.
The RFP Proposal called for about $2.2M for a full fit out of all three buildings, a green roof on the livery, a rooftop restaurant, and a roof top patio.
The one and only bid that the DDA obtained for restoration and white-boxing all three buildings was $1.50M-$1.75M.
- The following is an estimated cost comparison for the Chelsea Connection Proposal vs. DDA “Plan B” (See Attachment A for more detail)
Chelsea Connection:
DDA takes a $200k loss on sale, plus a $50k loss for professional fees: total loss of $250k
Chelsea begins collecting property taxes: first based on new basis for the property ($200k) – maybe $6000/ year, and escalating as property value increases with renovation.
The following are some ideas for halting demolition on the Livery and Daniels Showroom:
Financial Reasons/Fiscal Responsibility
- From a fiscal standpoint we feel that for the DDA to purchase these buildings for more than their appraised value and then turn around and tear down ½ to 2/3s of the complex is fiscally negligent and irresponsible.
- We feel that this it is not fiscally responsible of City Government or the DDA to demolish nationally significant historic buildings for a parking lot.
- The potential taxes that could be collected from the Longworth Complex as businesses would be roughtly . As a parking lot/sitting/entertainment area, it would bring $0 in taxes and would cost the city approximately to maintain.
- Three serious potential buyers have been interested in these buildings, but were chased away by the price that the DDA was asking to purchase these buildings and/or by the cost of sanitary sewer/water hookup fees.
- The DDA wants a buyer to pay $400,000 to purchase these buildings, but no one could get a mortgage for that amount, because the appraised value is only $300,000.
- When the DDA is quoting their renovation costs compared to our renovation costs they are not comparing apples to apples. They keep quoting the much higher cost of a “full fit out”, as opposed to the cost of “white-boxing” all the buildings. This helps to support their argument that they cannot “afford” to renovate these buildings.
- The DDA has continued to misrepresent the cost of reusing these buildings. A local builder has studied these buildings and has quoted a significantly lower price to stabilize and do any necessary repairs on the buildings. The following are his quotes
Charlie Shiver’s original quote for restoration and white-boxing the entire facility (all three buildings) was $800K. In a subsequent evaluation, Charlie estimated $500K to restore and white-box the Livery by itself. This included all new structural work for the roof and 2nd floor.
The RFP Proposal called for about $2.2M for a full fit out of all three buildings, a green roof on the livery, a rooftop restaurant, and a roof top patio.
The one and only bid that the DDA obtained for restoration and white-boxing all three buildings was $1.50M-$1.75M.
- The following is an estimated cost comparison for the Chelsea Connection Proposal vs. DDA “Plan B” (See Attachment A for more detail)
Chelsea Connection:
DDA takes a $200k loss on sale, plus a $50k loss for professional fees: total loss of $250k
Chelsea begins collecting property taxes: first based on new basis for the property ($200k) – maybe $6000/ year, and escalating as property value increases with renovation.
Points sent to each City Council member p 2
When 18,000 SF complex is worth $2M in 3 years, that’s maybe $60k/year. Tack in utility tap fees of at least $100k, and DDA/ City in aggregate is “above water” in 3-4 years.
Note: additional out of pocket expense for DDA: $0
DDA Plan B:
DDA currently is invested for say $450k.
Livery and Mack Demolition: $70k + additional environmental professional fees, legal fees, soft cost for Hanifan’s time etc.: easily $100k total, could see this doubling with legal fees.
Daniels Green space and Mack face restoration: $50k minimum
Livery redevelopment (parking, retaining wall, entertainment venue, lighting, public restrooms etc.) $500k ballpark.
Mack Vanilla boxing (bear in mind they will not have the luxury of pro-bono/ in-kind etc.) : $700k ballpark, could be $1M if they’re not careful.
Sale when 7500 SF Mack is complete: $800k.
Net loss: $1M ballpark.
Tax revenue: maybe $25k/ year.
Maintenance/ operating cost for new public outdoor spaces: Not sure, maybe $5-10k? …but more than with Chelsea Connection Chelsea in any case.
Chelsea is not likely to ever get “above water” with this scenario.
- The DDA states that they cannot “afford” to reuse the livery and Daniels Showroom, because they don’t have enough money. Their plans do not call for just stabilizing and repairing the buildings, but for “white box renovations” which would make them move in ready. We don’t feel that this is necessary at the present time and may not be what a developer may want, as the industrial feel is very appealing in the present marketplace.
- All three buildings have been found to be eminently re-useable by qualifies professional architects and builders who have each looked at these buildings.
Historic Reasons
- Adaptive reuse of historic buildings is cited as a Planning Guideline in Chelsea City Documents for the future growth and vitality of Chelsea.
- The Central Business District Management Strategies Goals include:
- Preserve the historic, small town character of downtown Chelsea
- Ensure the renovations of historic buildings in the downtown area to retain the existing historical and architectural integrity
- Ensure new infill development is compatible with the downtown’s historic architecture…and character.
- The word historic occurs 29 times in Chelsea Comprehensive Plan as a stated value.
- Janet Greenstein Potter, author and nationally recognized expert on railroads and railroad buildings has written a book entitled “Great American Railroad Stations” which was commissioned by the National Trust for Historic Preservation. She has stated that the Train Depot, Livery and Chelsea House Hotel (presently the Farmers Supply) are
Note: additional out of pocket expense for DDA: $0
DDA Plan B:
DDA currently is invested for say $450k.
Livery and Mack Demolition: $70k + additional environmental professional fees, legal fees, soft cost for Hanifan’s time etc.: easily $100k total, could see this doubling with legal fees.
Daniels Green space and Mack face restoration: $50k minimum
Livery redevelopment (parking, retaining wall, entertainment venue, lighting, public restrooms etc.) $500k ballpark.
Mack Vanilla boxing (bear in mind they will not have the luxury of pro-bono/ in-kind etc.) : $700k ballpark, could be $1M if they’re not careful.
Sale when 7500 SF Mack is complete: $800k.
Net loss: $1M ballpark.
Tax revenue: maybe $25k/ year.
Maintenance/ operating cost for new public outdoor spaces: Not sure, maybe $5-10k? …but more than with Chelsea Connection Chelsea in any case.
Chelsea is not likely to ever get “above water” with this scenario.
- The DDA states that they cannot “afford” to reuse the livery and Daniels Showroom, because they don’t have enough money. Their plans do not call for just stabilizing and repairing the buildings, but for “white box renovations” which would make them move in ready. We don’t feel that this is necessary at the present time and may not be what a developer may want, as the industrial feel is very appealing in the present marketplace.
- All three buildings have been found to be eminently re-useable by qualifies professional architects and builders who have each looked at these buildings.
Historic Reasons
- Adaptive reuse of historic buildings is cited as a Planning Guideline in Chelsea City Documents for the future growth and vitality of Chelsea.
- The Central Business District Management Strategies Goals include:
- Preserve the historic, small town character of downtown Chelsea
- Ensure the renovations of historic buildings in the downtown area to retain the existing historical and architectural integrity
- Ensure new infill development is compatible with the downtown’s historic architecture…and character.
- The word historic occurs 29 times in Chelsea Comprehensive Plan as a stated value.
- Janet Greenstein Potter, author and nationally recognized expert on railroads and railroad buildings has written a book entitled “Great American Railroad Stations” which was commissioned by the National Trust for Historic Preservation. She has stated that the Train Depot, Livery and Chelsea House Hotel (presently the Farmers Supply) are
Points sent to each City Council member p 3
nationally significant and “together , the train station, old hotel, and livery make up one of the (if not THE) last remaining transportation cooridors in the US to have all three of these buildings types. She stated that in her consultations with several hundred historians, architects, transportation specialists, librarians and state historic preservation officers that “Chelsea is extraordinary and, in my view, literally unique in retaining not only the first hotel, but also the livery. In my research, I uncovered no equivalent situation…The loss of this building (the Livery) would affect not only Chelsea, but also the history of everyday life in the United States.”
- The Livery is believed to be one of only a few liveries still standing in Michigan, Several of these have been adaptively reused and house successful businesses.
- The Longworth Buildings are a contributing part of a nomination for the National Register of Historic Places.
- Historic buildings,including those with exposed brick interiors, are very marketable to present day restaurants (Common Grill) and retail businesses (Treehouse) owners.
- In the most recently published Community Guide published by the Community Observer, 100 % of Chelsea’s listed “Attractions” (See Attachment B) were either located in historic buildings in town (which was often mentioned in its description) or involved historic information sharing. We are using our HISTORY to market our town and yet the City and the DDA are tearing down very historically significant buildings without just cause.
Improper Operation of DDA
- The DDA made these decisions without following appropriate procedures such as using bylaws and Open Meetings Act requirements
- Demolition does not support the DDA’s own adopted goals and objectives:
Goals
A. To maintain the strength of the city center as an active marketplace-the retail
center of Chelsea,. It is important to capatilize on the historic character of the
downtown.
B. To continue to enhance the historic character of the downtown through
restoration and renovation…
D.Maintain the distinction of the different character…of the commercial district
and downtown Chelsea.
Objectives
A.Preservation of Chelsea’s small-town character and historic image.
- Demolition of these historic sites is in violation of State of Michigan Public Act 197 of 1975 (the act which allows for the formation of DDAs) “A public facility, building, or structure that is determined by the municipality to have significant historical interest shall be preserved in a manner…in accordance with laws relative to the preservation of historical sites.”
- The DDA has not had bylaws in its entire existence (since 1985) which violates the City of Chelsea Code of Ordinances Chapter 12, Section 12-45 Bylaws “The board of the authority shall develop and approve bylaws for its operation.” (Ordinance No. 97)
Without written bylaws and procedures, the public has no idea how the DDA works, how decisions are made, or how to have input and it allows the DDA to operate without public accountability.
- The Livery is believed to be one of only a few liveries still standing in Michigan, Several of these have been adaptively reused and house successful businesses.
- The Longworth Buildings are a contributing part of a nomination for the National Register of Historic Places.
- Historic buildings,including those with exposed brick interiors, are very marketable to present day restaurants (Common Grill) and retail businesses (Treehouse) owners.
- In the most recently published Community Guide published by the Community Observer, 100 % of Chelsea’s listed “Attractions” (See Attachment B) were either located in historic buildings in town (which was often mentioned in its description) or involved historic information sharing. We are using our HISTORY to market our town and yet the City and the DDA are tearing down very historically significant buildings without just cause.
Improper Operation of DDA
- The DDA made these decisions without following appropriate procedures such as using bylaws and Open Meetings Act requirements
- Demolition does not support the DDA’s own adopted goals and objectives:
Goals
A. To maintain the strength of the city center as an active marketplace-the retail
center of Chelsea,. It is important to capatilize on the historic character of the
downtown.
B. To continue to enhance the historic character of the downtown through
restoration and renovation…
D.Maintain the distinction of the different character…of the commercial district
and downtown Chelsea.
Objectives
A.Preservation of Chelsea’s small-town character and historic image.
- Demolition of these historic sites is in violation of State of Michigan Public Act 197 of 1975 (the act which allows for the formation of DDAs) “A public facility, building, or structure that is determined by the municipality to have significant historical interest shall be preserved in a manner…in accordance with laws relative to the preservation of historical sites.”
- The DDA has not had bylaws in its entire existence (since 1985) which violates the City of Chelsea Code of Ordinances Chapter 12, Section 12-45 Bylaws “The board of the authority shall develop and approve bylaws for its operation.” (Ordinance No. 97)
Without written bylaws and procedures, the public has no idea how the DDA works, how decisions are made, or how to have input and it allows the DDA to operate without public accountability.
Points sent to each City Council member p 4
implement them. The mayor only gave us a letter stating that we were allowed to investigate grant funding. We are a citizen group with no money ourselves and no power over these buildings because we do not own them.
Possible remedies
1)Council direct the DDA to sell all the buildings to our group per our proposal. (Ask Council Member…”Have you seen our proposal?”)
2)DDA retain ownership of all three buildings but allow the PC-CCT to actively search out funding, in-kind services and volunteer help to restore these buildings while they deal with the Mack Building with their resources.
3)Direct the DDA to work with the PC-CCT on their proposal to find a mutually acceptable plan for moving forward with renovating all three buildings.
4)Council put an immediate stop on any demolition plans and revisit the 2010 DDA budget with regards to the Longworth Complex Demolition.
5)Require that the DDA work cooperatively with the PC-CCT to a positive end to this for all, as opposed to ignoring us and perpetuating a negative relationship with the public.
6)The Mayor and the Council have the regulatory authority to change how the DDA does business and can require that they listen to public input before decisions are made that affect all of its residents in a significant way!
7)We want the DDA to give the citizens and local businesses a chance to raise the
necessary funds for rehabilitation.
Questions to Pose to Council Members
1)How is this project fiscally responsible for the City and the DDA now that we have shown that there are less expensive alternatives from professionals that know what they are talking about?
2)How can the DDA be allowed to use $500,000 in Public taxes annually, while ignoring the input of over 700 residents (which apparently is more than the amount of people who elected the present mayor) of Chelsea and the surrounding area who say they want all these buildings saved?
3)How can the DDA ignore their own mission, goals and objectives to “preserve and restore historic buildings” with this project?
4)How can the City of Chelsea have historical buildings as an attractions (see the Community Observer), yet continue to tear down historic structures downtown.
5)How can the DDA just “refuse” our very detailed, well thought out proposal without any kind of detailed reply to us about how it was reviewed and why specifically it was rejected?
6)Why is there no apparent public accountability for the decisions of the DDA? They seem to work in a vacuum and are allowed to use Public Tax dollars to do it.
7)Why was the DDA allowed to purchase these buildings at a cost above the appraised value?
Possible remedies
1)Council direct the DDA to sell all the buildings to our group per our proposal. (Ask Council Member…”Have you seen our proposal?”)
2)DDA retain ownership of all three buildings but allow the PC-CCT to actively search out funding, in-kind services and volunteer help to restore these buildings while they deal with the Mack Building with their resources.
3)Direct the DDA to work with the PC-CCT on their proposal to find a mutually acceptable plan for moving forward with renovating all three buildings.
4)Council put an immediate stop on any demolition plans and revisit the 2010 DDA budget with regards to the Longworth Complex Demolition.
5)Require that the DDA work cooperatively with the PC-CCT to a positive end to this for all, as opposed to ignoring us and perpetuating a negative relationship with the public.
6)The Mayor and the Council have the regulatory authority to change how the DDA does business and can require that they listen to public input before decisions are made that affect all of its residents in a significant way!
7)We want the DDA to give the citizens and local businesses a chance to raise the
necessary funds for rehabilitation.
Questions to Pose to Council Members
1)How is this project fiscally responsible for the City and the DDA now that we have shown that there are less expensive alternatives from professionals that know what they are talking about?
2)How can the DDA be allowed to use $500,000 in Public taxes annually, while ignoring the input of over 700 residents (which apparently is more than the amount of people who elected the present mayor) of Chelsea and the surrounding area who say they want all these buildings saved?
3)How can the DDA ignore their own mission, goals and objectives to “preserve and restore historic buildings” with this project?
4)How can the City of Chelsea have historical buildings as an attractions (see the Community Observer), yet continue to tear down historic structures downtown.
5)How can the DDA just “refuse” our very detailed, well thought out proposal without any kind of detailed reply to us about how it was reviewed and why specifically it was rejected?
6)Why is there no apparent public accountability for the decisions of the DDA? They seem to work in a vacuum and are allowed to use Public Tax dollars to do it.
7)Why was the DDA allowed to purchase these buildings at a cost above the appraised value?
Points sent to each City Council member p 5
Attachment A
Here’s the spreadsheet I included in the 4/10 and 7/10 proposal. This is a summary spreadsheet of far more detailed conceptual estimates that I prepared for each phase. A few things about the estimates and summary:
This is a conceptual estimate, based on the conceptual scope and sketch described. Conceptual means each sub-item is subject to significant change, but taken in aggregate, we should be +/- 10-20% for each phase. If this project were to proceed, the design team would have developed “schematic design” (SD) documents (plans and specifications), then possibly “design development” (DD) documents and finally “construction document” (CD) level drawings. With each step we revisit and finetune an estimate, adding more detail and refining accuracy as we go. Based on scope defined and delivery method proposed, I think this is a pretty good estimate. I’ll remind folks that unlike most of the members of the DDA, I do and/or manage construction estimates on almost a daily basis.
Estimates include allowances (where I could not come up with a good number), contingencies (design phase and construction phase scope change), design and project management fees (based on reduced rates we proposed to charge), as well as operating costs during each phase (including allowance for property taxes, fees, utilities etc.). These are all encompassing “project cost” numbers. I may have underestimated water tap fees, but most of that is likely covered elsewhere, and would work itself out in the wash.
Phase 2 includes the cost of real estate purchase at $200k.
I included a “phase value” for each of the seven phases. This is not out of pocket cost for each phase. Rather, it includes all “funding sources”, including value of pro-bono/ volunteer time, in-kind investments etc. Furthermore, phase value includes more than just associated costs for work done in that phase. Rather, it also includes carrying cost associated for costs incurred in previous phases, and operating costs associated with that window in time. It may not be a purist accountants approach (remember, I’m an engineer, not an accountant), but I thought it was the easiest way to summarize value and cash flow required on one sheet of paper. Note that total “value” over the 3 year window we projected for project completion, total project phase value was about $2.4M. This includes the $200k for purchase price. If you subtract out the pro bono value of $120k and projected lease income of $280k thru 2012, you’re at about $2.0M. Furthermore subtract about $800k for tax credits and grants, and you’re down to about $1.2M for “investment value” in the property (investment that must be repaid). Note I may still be underestimating tax credits, but may also be overstating grants, but this was my best guess projection based on info that we’d heard from MHPN etc. Investments breaks down into:
o Venture Capital Investment of $342k – maybe call it $350k. My personal target was to have $400k available. We needed most of that up front to purchase the buildings outright. A hoped for negotiating point
Here’s the spreadsheet I included in the 4/10 and 7/10 proposal. This is a summary spreadsheet of far more detailed conceptual estimates that I prepared for each phase. A few things about the estimates and summary:
This is a conceptual estimate, based on the conceptual scope and sketch described. Conceptual means each sub-item is subject to significant change, but taken in aggregate, we should be +/- 10-20% for each phase. If this project were to proceed, the design team would have developed “schematic design” (SD) documents (plans and specifications), then possibly “design development” (DD) documents and finally “construction document” (CD) level drawings. With each step we revisit and finetune an estimate, adding more detail and refining accuracy as we go. Based on scope defined and delivery method proposed, I think this is a pretty good estimate. I’ll remind folks that unlike most of the members of the DDA, I do and/or manage construction estimates on almost a daily basis.
Estimates include allowances (where I could not come up with a good number), contingencies (design phase and construction phase scope change), design and project management fees (based on reduced rates we proposed to charge), as well as operating costs during each phase (including allowance for property taxes, fees, utilities etc.). These are all encompassing “project cost” numbers. I may have underestimated water tap fees, but most of that is likely covered elsewhere, and would work itself out in the wash.
Phase 2 includes the cost of real estate purchase at $200k.
I included a “phase value” for each of the seven phases. This is not out of pocket cost for each phase. Rather, it includes all “funding sources”, including value of pro-bono/ volunteer time, in-kind investments etc. Furthermore, phase value includes more than just associated costs for work done in that phase. Rather, it also includes carrying cost associated for costs incurred in previous phases, and operating costs associated with that window in time. It may not be a purist accountants approach (remember, I’m an engineer, not an accountant), but I thought it was the easiest way to summarize value and cash flow required on one sheet of paper. Note that total “value” over the 3 year window we projected for project completion, total project phase value was about $2.4M. This includes the $200k for purchase price. If you subtract out the pro bono value of $120k and projected lease income of $280k thru 2012, you’re at about $2.0M. Furthermore subtract about $800k for tax credits and grants, and you’re down to about $1.2M for “investment value” in the property (investment that must be repaid). Note I may still be underestimating tax credits, but may also be overstating grants, but this was my best guess projection based on info that we’d heard from MHPN etc. Investments breaks down into:
o Venture Capital Investment of $342k – maybe call it $350k. My personal target was to have $400k available. We needed most of that up front to purchase the buildings outright. A hoped for negotiating point
Points sent to each City Council member, p 6
would have been to sign purchase agreement with contingency on raising capital, giving us 60-120 days to secure say $300k, but we never got to discussing details with the DDA
o Commercial financing accounted for $576k. This first portion of this ($350k) was accounted for in the letter of interest from CSB. Key factor was getting a lease commitment for $4000/mo, which we had in the New Chelsea Market. The second installment ($226k) would have come when we were ready to go with the livery/ apartments. We could have leveraged the completed Mack/ Daniels buildings for this additional borrowing power, or made the push to get leases signed. We already had a verbal commitment for one of the 8 apartments. Worth noting, by the 3rd year we projected positive cash flow that would allow repayment to start, and in 4th year we projected making a big dent in debt reduction. If property were not sold first, I think we would have owned it free and clear in about 8 years, though the spreadsheet doesn’t carry that far out.
o In-kind investment (shows on spreadsheet as deferred payment) filled the balance, at about $286k. A big chunk of this was firmly but verbally committed from Scott and me on the design end, and from several contractor friends who were willing to invest a large portion of their labor, and in some cases material, in exchange for a proportionate share in the property. Conservatively, I’d say I had at least $150k accounted for already. I suspect we could have increased this component, but I think the DDA were already skeptical on our ability to make this approach work.
Tom Girard
o Commercial financing accounted for $576k. This first portion of this ($350k) was accounted for in the letter of interest from CSB. Key factor was getting a lease commitment for $4000/mo, which we had in the New Chelsea Market. The second installment ($226k) would have come when we were ready to go with the livery/ apartments. We could have leveraged the completed Mack/ Daniels buildings for this additional borrowing power, or made the push to get leases signed. We already had a verbal commitment for one of the 8 apartments. Worth noting, by the 3rd year we projected positive cash flow that would allow repayment to start, and in 4th year we projected making a big dent in debt reduction. If property were not sold first, I think we would have owned it free and clear in about 8 years, though the spreadsheet doesn’t carry that far out.
o In-kind investment (shows on spreadsheet as deferred payment) filled the balance, at about $286k. A big chunk of this was firmly but verbally committed from Scott and me on the design end, and from several contractor friends who were willing to invest a large portion of their labor, and in some cases material, in exchange for a proportionate share in the property. Conservatively, I’d say I had at least $150k accounted for already. I suspect we could have increased this component, but I think the DDA were already skeptical on our ability to make this approach work.
Tom Girard
Wednesday, September 15, 2010
Comments and request made at City Council on September 14
September 14, 2010
Ladies and Gentlemen:
My name is Jan Bernath, and I live at 238 Harrison Street. The last time I was before this body was less than a year ago when I presented 700 signatures of area residents who did not want the Longworth Property demolished. Since that time, a group of hard-working, knowledgeable, skilled Chelsea citizens submitted a proposal to buy the property in response to the DDA's RFP. It was declined on August 19.
You all have received an email from Cathy Bean today citing, in detail, the reasons the impending demolition of the Daniels Addition and the livery is an unwise decision. The categories of those reason are:
1.financial/fiscal responsibility
2.historic significance
3.environmental
4.public accountability
5.partnering for a maximum solution
6.improper operation of the DDA
It's my understanding that the Council has oversight of the DDA by approval of the:
1.overall budget
2.mayor's appointment of a nominee to fill a vacancy
3.bonds for long term debt
4.changes in the DDA charter
I respectfully urge a motion tonight to direct the city manager and staff to temporarily halt further work on the due care plan and application for a demolition permit. This would allow you to read, study and discuss the information provided to you by Cathy Bean.
You are the stewards of our community resources. As elected officials, you operate within the five ethical principles of the government of the City of Chelsea. Thank you for your service.
Ladies and Gentlemen:
My name is Jan Bernath, and I live at 238 Harrison Street. The last time I was before this body was less than a year ago when I presented 700 signatures of area residents who did not want the Longworth Property demolished. Since that time, a group of hard-working, knowledgeable, skilled Chelsea citizens submitted a proposal to buy the property in response to the DDA's RFP. It was declined on August 19.
You all have received an email from Cathy Bean today citing, in detail, the reasons the impending demolition of the Daniels Addition and the livery is an unwise decision. The categories of those reason are:
1.financial/fiscal responsibility
2.historic significance
3.environmental
4.public accountability
5.partnering for a maximum solution
6.improper operation of the DDA
It's my understanding that the Council has oversight of the DDA by approval of the:
1.overall budget
2.mayor's appointment of a nominee to fill a vacancy
3.bonds for long term debt
4.changes in the DDA charter
I respectfully urge a motion tonight to direct the city manager and staff to temporarily halt further work on the due care plan and application for a demolition permit. This would allow you to read, study and discuss the information provided to you by Cathy Bean.
You are the stewards of our community resources. As elected officials, you operate within the five ethical principles of the government of the City of Chelsea. Thank you for your service.
Comments and request made at City Council on September 14
Larry Bean 204 Washington
As a follow up to Jan’s request for a motion tonight to temporarily stop demolition activities, I would like to describe our plan to work with you on these issues which are very important to the City of Chelsea.
This will give you time to evaluate the information provided and ask us questions over the next two weeks.
We ask that you place this issue on your agenda for discussion during the next meeting on September 28. We suggest that you then continue these discussions with us and the DDA over the next couple weeks after that meeting.
During the October 12 meeting we will request that you make a motion to vote on blocking funding for demolition of these buildings and require the DDA to work with this Citizen’s group to rehabilitate the entire Longworth complex with promised money from within Chelsea and outside grant money.
As a follow up to Jan’s request for a motion tonight to temporarily stop demolition activities, I would like to describe our plan to work with you on these issues which are very important to the City of Chelsea.
This will give you time to evaluate the information provided and ask us questions over the next two weeks.
We ask that you place this issue on your agenda for discussion during the next meeting on September 28. We suggest that you then continue these discussions with us and the DDA over the next couple weeks after that meeting.
During the October 12 meeting we will request that you make a motion to vote on blocking funding for demolition of these buildings and require the DDA to work with this Citizen’s group to rehabilitate the entire Longworth complex with promised money from within Chelsea and outside grant money.
Friday, September 10, 2010
All the contacts needed for you to act on
Easy actions you can take to save the Longworth Complex
to Keep Our Past Present
If you are interested in supporting future development by adaptively re-using this important part of the historic downtown and our heritage,
Speak and Write Publicly & Contact Personally Your Local DDA and Council Members
LOCAL
Chelsea City Council — elected officials
Speak during the public comment section at the beginning of City Council, meeting September 14 (Tuesdays), 7 pm, held in the Board Room of the Washtington Street Education Center. (southern-most building, west side through double doors. Again, public comment is at the beginning of the meeting. Introduce yourself, state your address. It is best to prepare a written statement and to hand the statement to the clerk for filing.
Contact City Council members personally. Make an appointment during office hours: Monday and Friday 3:30pm to 5:00pm.
Jason Lindauer, Mayor — email: jlindauer@city-chelsea.org — 475-1771
Cheri Albertson, Mayor Pro-Tem — email: cheriaa@umich.edu — 475-8313
Ann Feeney — email: annfeeney@aol.com — Home Phone: 475-1493
Bill Holmberg -- email: holmbergwilliam@sbcglobal.net — 433-9733
Rod Anderson — email: rod.anderson@sbcglobal.net — 475-5898
Kent Martinez-Kratz — email: kkratz@jpsmail.org
Frank Hammer — email: beemerguy@fastmail.fm — 475-1828
John Hanifan, City Manager — email: jhanifan@city-chelsea.org — 475-1771 ext 201
Downtown Development Authority (DDA) — appointed officials
Attend the next DDA meeting on August 19 (Thursday) beginnning at 7:30 AM in the basement of City Hall. Speak during public comment at the end of the meeting.
Contact these DDA members by phone or at their place of business.
Jason Lindauer — mayor, City of Chelsea — City Hall, 305 South Main — 475-1771
Michael Jackson — owner of Vogel's and Foster's, 107 South Main — 475-1606
Mark Heydlauff — owner of Heydlauff's Inc, 113 North Main — 475-1221
Paul Frisinger — Realtor with Reinhart Realtor, 800 South Main — 433-2184
Robert Pierce — Dir. Chelsea Area Chamber of Commerce, 310 North Main — 475-1145
Jeff Holman — Property Manager, McKinley, Inc., 320 North Main — 734-769-8520, ext. 489
Pattie Schwarz — River Gallery, 120 North Main — 433-0826
Jim Myles — owner of Chelsea House Victorian Inn, 118 East Middle — 433-4663
Rob Winans — owner of Winans Jewelry, 108 South Main — 475-2622
Palmer Morrel-Samuels — EMPA, 111 South Main — 433-0344
Pat Cleary — owner of Cleary's Pub, 113 South — 475 1922
Peter C. Flintoft — attorney, Keusch, Flintoft,& Conlin, PC, 119 South Main —475-8671
John Hanifan — (Staff Liaison) City Manager — City Hall, 305 South Main — 475-1771 ext 201
The Chelsea Standard
Write a letter to editor to The Chelsea Standard stating your position. Send an electronic and hard copy to:
Daniel Lai – email: Dlai@heritage.com Editor, Chelsea Standard
Address: Heritage Newspapers, Chelsea Standard, 106 W Michigan Ave, Saline, MI 48176
Phone: 734 429 7380; FAX: 734 429 3621
You must include your address.
to Keep Our Past Present
If you are interested in supporting future development by adaptively re-using this important part of the historic downtown and our heritage,
Speak and Write Publicly & Contact Personally Your Local DDA and Council Members
LOCAL
Chelsea City Council — elected officials
Speak during the public comment section at the beginning of City Council, meeting September 14 (Tuesdays), 7 pm, held in the Board Room of the Washtington Street Education Center. (southern-most building, west side through double doors. Again, public comment is at the beginning of the meeting. Introduce yourself, state your address. It is best to prepare a written statement and to hand the statement to the clerk for filing.
Contact City Council members personally. Make an appointment during office hours: Monday and Friday 3:30pm to 5:00pm.
Jason Lindauer, Mayor — email: jlindauer@city-chelsea.org — 475-1771
Cheri Albertson, Mayor Pro-Tem — email: cheriaa@umich.edu — 475-8313
Ann Feeney — email: annfeeney@aol.com — Home Phone: 475-1493
Bill Holmberg -- email: holmbergwilliam@sbcglobal.net — 433-9733
Rod Anderson — email: rod.anderson@sbcglobal.net — 475-5898
Kent Martinez-Kratz — email: kkratz@jpsmail.org
Frank Hammer — email: beemerguy@fastmail.fm — 475-1828
John Hanifan, City Manager — email: jhanifan@city-chelsea.org — 475-1771 ext 201
Downtown Development Authority (DDA) — appointed officials
Attend the next DDA meeting on August 19 (Thursday) beginnning at 7:30 AM in the basement of City Hall. Speak during public comment at the end of the meeting.
Contact these DDA members by phone or at their place of business.
Jason Lindauer — mayor, City of Chelsea — City Hall, 305 South Main — 475-1771
Michael Jackson — owner of Vogel's and Foster's, 107 South Main — 475-1606
Mark Heydlauff — owner of Heydlauff's Inc, 113 North Main — 475-1221
Paul Frisinger — Realtor with Reinhart Realtor, 800 South Main — 433-2184
Robert Pierce — Dir. Chelsea Area Chamber of Commerce, 310 North Main — 475-1145
Jeff Holman — Property Manager, McKinley, Inc., 320 North Main — 734-769-8520, ext. 489
Pattie Schwarz — River Gallery, 120 North Main — 433-0826
Jim Myles — owner of Chelsea House Victorian Inn, 118 East Middle — 433-4663
Rob Winans — owner of Winans Jewelry, 108 South Main — 475-2622
Palmer Morrel-Samuels — EMPA, 111 South Main — 433-0344
Pat Cleary — owner of Cleary's Pub, 113 South — 475 1922
Peter C. Flintoft — attorney, Keusch, Flintoft,& Conlin, PC, 119 South Main —475-8671
John Hanifan — (Staff Liaison) City Manager — City Hall, 305 South Main — 475-1771 ext 201
The Chelsea Standard
Write a letter to editor to The Chelsea Standard stating your position. Send an electronic and hard copy to:
Daniel Lai – email: Dlai@heritage.com Editor, Chelsea Standard
Address: Heritage Newspapers, Chelsea Standard, 106 W Michigan Ave, Saline, MI 48176
Phone: 734 429 7380; FAX: 734 429 3621
You must include your address.
Friday, September 3, 2010
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