Saline City Council: Live Reporting from the Oct. 5 Meeting

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The Saline Post's live reporting from the Saline City Council meeting.

Huntington Woods Connecting Sidewalk

During public comment, several Saline Township residents spoke against the proposed sidewalk, meant to connect Huntington Woods subdivisions to town, along the west side of Monroe Street. One Huntington Woods resident spoke in favor of installing a sidewalk. The issue is that the proposed sidewalk crosses Saline Township properties.

Council reviewed a plan designed by Joseph Maynard, of Washtenaw Engineering Co. Maynard has worked with former property owner and developer David Shipman.

Councillor Jack Ceo said he was shocked by the increasing price of the sidewalk. The price is now in the low to mid-$200,000s. Ceo asked how much the city would pay and how much David Shipman, former property owner who promised the sidewalk, would pay.

Mayor Marl said that share would need to be negotiated, but that Shipman has promised up to $110,000 for the project.

Ceo asked about the cost difference between a boardwalk and sidewalk. Maynard said a boardwalk generally costs more.

Council Jim Dell'Orco asked about the connecting sidewalk. He said the drawings don't show a sidewalk going over Adient's property (former Universal site). Mayor Brian Marl said a contact at Adient had plans for the front of Adient, but that contact has left the company. He said the city should press their new contact from Adient to move quickly on a sidewalk.

Dell'Orco said a Saline Township property owner had every right to be at the meeting. The property owner does not want to be liable for the sidewalk.

Jeff Weiss, Huntington Woods resident, said Huntington Woods Phase 1 residents have agreed to take responsibility for the sidewalk. He said their HOA is talking with Pulte (builders of phases two and three) for sharing some costs. Weiss said in the winter, a sign would warn people that the sidewalk would not be cleared.

Councillor Dean Girbach said he would not consider any proposal that would use eminent domain. Maynard said it was all in the right of way. Girbach asked about the boardwalk maintenance on Textile Road. McCullough said the road commission has no responsibility for the sidewalk. Pittsfield Township would take liability for that boardwalk, McCullough said. McCullough said the county road commission does not maintain sidewalks in the right of way.

Girbach said the Layher Farms sidewalks on Maple are to be made of asphalt, which is cheaper. He said this sidewalk should be made of asphalt, and not concrete, to save funds.

Councillor Janet Dillon agreed with Girbach's point about asphalt. Maynard said the county would consider asphalt. He said asphalt sidewalks have a similar lifespan at a lower cost.

Dillon asked whether city attorneys have reviewed the idea of the city taking on a project outside the city limits. Marl said he didn't recall any angst about taking over the project. Dillon said she'd like documentation from lawyers.

Dillon asked if a special assessment was considered for the project. Marl said it was not considered because the city does not yet have oversight of the project.

Dillon asked about options, including crossing the street or routing a sidewalk through Curtiss Park. Maynard said crossing concerns convinced them not to build on the other side of Monroe Street.

Dillon said she was concerned with the ballooning cost, especially with any talk about the city paying a certain percentage of the cost.

Councillor Christen Mitchell asked why there was so much delay on this project. Maynard said there were issues with drainage and easement rights.

Mitchell said if the city is going to put a sidewalk across township properties, it was important to have property drainage.

Mitchell asked if the city required a sidewalk for phase one of Huntington Woods. Councillor Girbach said not at that time. Marl said the city began requiring a sidewalk during talks for phase two of Huntington Woods.

Mitchell suggested having an urban planner present several options for a sidewalk.

Councillor Kevin Camero-Sulak agreed it was the city's responsibility to have a good grasp of the costs of the project. He asked about a timeline for phase two and three of Huntington Woods. Camero-Sulak agreed with Mitchell's suggestion to have an urban planner consider the project.

Marl asked Maynard to explore what kind of savings might be realized with an asphalt sidewalk. Marl asked council members to forward questions to Marl by 5 p.m. Friday.

Marl said residents of that area deserve a safe and efficient way to access downtown and that he wanted the council to move quickly.

"It's been promised for 15 years and in my judgment, it's time to deliver," Marl said.

REGULAR MEETING

Public Comment

Mary Hess: She asked if the city can ask the county for a variance on the Huntington Woods connecting sidewalk.

Jim Klusinski: People between his yard and the drain have brought in a lot of dirt. As a result, water now comes up to the foundation of his Eastlook Drive home. He said there are 10 homes draining into his backyard now. He said he'd like the city to do something. He's been asking for action since June of 2019.

Adient Property Presentation

James VandeWyngearde, Director of Litigation for Adient, and Ben Grawe, environmental counsel representing Adient, updated the council on the work being done on their Monroe Street project.

Grawe went over the history of the 9.3-acre site, which has been mostly quiet for 25 years. Adient is remediating the site.

PFAS and volatile organic compounds were found on the site. The state sampled wells within 500 feet of the site. The sample results showed no PFAS or trace-level amounts of PFAS. But there is PFAS on the property and Adient continues to investigate the property.

Clay layers on the property act as acquatards to keep contaminants from the groundwater. But they make it harder to clean the soil. 

Adient may need to move a guardrail along the property to install more groundwater monitoring.

Adient is testing to see of volatile organic compound vapors have migrated through utility corridors.

Grawe said soil vapor extraction is not useful to help remove volatile organic compounds because of the layers of clay.

Grawe talked about the 450-foot sidewalk in front of the property and the fire hydrant in the path. Grawe said Adient would work with the city on issues.

Grawe said barrels being stored on the site are being removed after there were complaints from residents. The barrels did not contain contaminants.

Marl said the site looked appalling seven years ago and that tremendous work had been done in recent years. Marl said the city was eager to help Adient remediate the property.

Marl asked if the sidewalk presented an environmental risk. Grawe said he didn't think there should be a problem.

Councillor Ceo asked if there was an assessment of riverbed soil. Grawe said the sediment would be assessed and that some soil could be removed if necessary. Ceo said the weeds needed to be handled. Grawe said the pandemic has made it more difficult the way the site looks. He said he'd talk to Adient about the issue.

Council Dell'Orco asked about the clay layers. Grawe said there was a shallow aquifer that was contained by the first layer of clay. Below that layer, more clay created a medium-depth acquifer. Residents drink from a deeper acquifer, he said.

Dell'Orco asked what methods of cleaning were still possible. Grawe said "dig-and-haul" was one option, where you move the soil to a new location. He said it was an expensive option. He said Adient and the EPA are considering a chemical oxidation remedy.

Councillor Dell'Orco asked if the dig-and-haul method could disturb the clay and release contaminants into the drinking aquifer. Grawe said that could be a risk.

"Being slow and methodical can be frustrating for people, but we want to do this the right way and not make the problem worse," Grawe said.

Councillor Girbach asked what level of cleanup was expected. Grawe said these sites are not typically cleaned to a residential level. In some instances, he said, the property could become a park or open space. He added that monitoring can take a long time - 10 or 15 years.

Councillor Dillon asked about a timeframe for final remediation. Grawe said there wasn't one. He said Adient was still close to the beginning in the long arc of remediation. He said it was possible to put the land into limited use (like parkland) sooner than final remediation, but that it will depend on what the state and EPA require.

Councillor Dillon asked about whether the Huntington Woods sidewalk would disturb the land and contaminants. Grawe said he didn't want to speak for Adient on the issue but that sidewalk work involves shallow digging.

Councillor Mitchell asked if some remediation taken place. Grawe said significant amounts of contaminated rubble and concrete had already been removed from the site.

Mitchell asked if the city has proposed using the property for expanding its wastewater treatment plant. Grawe said he received that information, third hand.

Mitchell said there was a sidewalk in the 80s. She asked why it was removed. Grawe said he wasn't sure, but he believed there was an effort to "scrape it all clean." He said the sidewalk was not ADA compliant.

Mitchell asked if the city had the right to see reports about the site. Grawe said all the information sent to the EPA are public documents. Grawe said the EPA website isn't great. He said Adient would provide information to the city. Mitchell pointed out the city council recently agreed to spend $12,000 for a phase one environmental study of the property when the information was available by other methods.

Councillor Camero-Sulak asked if benefitted Adient to expedite the process. Grawe said Adient wants to move forward, but that it's a slow walk to move through the process. Councillor Camero-Sulak asked if there was any chance if the odors are coming from the site. Grawe said he wasn't aware of odor issues but said soil remediation can cause odors.

Marl said city staff would follow up with Adient soon on the sidewalk issue.

Saline Hotel Update

Bill Long said the first two years of the projects were about exploration, fundraising, forming the LLC. In 2018, the site was purchased in February and site development and construction got underway. 

The bank financing took the rest of the year to finalize. Due to the government shutdown in December of 2018, dispersements were delayed. The project ran on equity funding into early 2019.

There was scope creep and design changes in 2019. Equity fundraising didn't meet its goal. There was a lot of start/stop activity, which was not a good way to do this project, Long said.

Very little work was done in the third quarter of 2019. Work came to near halt by the fourth quarter of 2019. Things came to a head early in 2020. Discussions with the builder ratcheted up. There were acknowledgments the schedule needed substantial revision. 

Investors learned the $9.25-million project was far behind schedule and far over budget. The new figure was now $14-15 million.

First State Bank learned the status of the project and slammed the brakes on the project after awarding about half of the $6.3 million loan.

Investors by April had taken control of the project from management and Peters Building Company. In May a five-member advisory board was formed. The board meets weekly to oversee current operations and to devise a restructuring plan to keep the project in the hands of local investors.

What went wrong? Long said the initial budget was quite conservative. Too many trade projects were not fixed-cost deals, and as the project time lengthened, the project became more expensive.

Management was deficient in managing loan disbursements. Several disbursements were made straight to the builder and not Saline Lodging.

"I don't think there's any doubt the general contractor mismanaged construction," Long said. 

Long said investors should have demanded more information about the project.

There were five construction liens. Two have been settled.

First State Bank is pushing down the foreclosure route, Long said.

The group is going forward using Lenawee Construction Consultants to manage the project.

Long estimated the hotel can be completed for about $4.5 million. The cost of furniture and equipment should be around $1.2 million. He also spoke about $800,000 in soft costs.

"It's a big number, unfortunately," Long said.

He said the group has $2.5 million coming from a mezzanine loan. The group is looking for new investors to raise most of the rest of the $6.5 million.

He said that would be a challenge under normal circumstances and further complicated by the COVID-19 situation. But the group must raise at least half of the equity fundraising. 

Long said they've talked about an open house to help generate interest in the group.

The group has been trying to raise funds to fast track masonry work to help protect the building this winter. They're not quite there yet, Long said.

Long said the group has talked about "treading water" over the next six months, during which time a critical funding need might be met and the COVID-19 situation might recede.

They are looking to raise funds to pay off a delinquent tax bill.

The group will continue to keep city officials informed as progress is made and there are updates to provide.

Mayor Marl said it's in the community's interest to see the project completed. He said he was pleased to see the group's governance group had been revamped and filled with quality people. Marl said an open house would be valuable.

Marl said paying a portion of the summer taxes would be a demonstration of good will.

Marl asked how far along the project was.

Long said he looked at it from a numbers point of view. He pointed to $6.5 million in needs.

Councillor Dell'Orco asked about contractors and their liens. He said he was concerned that subcontractors won't be interested if there is concern about not being paid. Long said there are issues to be sorted with the three subcontractors holding liens against the project. Long said some of the subcontractors would be offered to participate in the project when it resumes. Long said the group won't get started until funding is fully in place.

Dell'Orco asked what the city can do to avoid a situation where the disbursements are made from the bank straight to the contractor. Dell'Orco called such a practice "almost criminal." Long said he wasn't sure how the city could prevent that.

Dell'Orco asked if the current group remains part of the original core investment group. Long said the advisory board includes the second, third and fourth largest equity investors. They've provided a third of the equity capital, Long said.

Dell'Orco asked if there were any investors clamoring to get out of the program. Long said no one has formally come forward and asked for consideration of their ownership stake to be purchased back. The lodging group doesn't have the funds for that. He said he has no doubt that the investors would love to be refunded if it were possible. Sale of ownership stakes can be considered once the hotel is up and running, Long said.

Councillor Dillon asked if Best Western was still committed to the project. Long said they are.

Councillor Dillon asked about the Ace Hardware store and their separation from the hotel project. Long said there were three issues. The seven-acre site was split into two parcels, with 5 1/4 acres went to the hotel. Junga is running his own project with the hardware store scheduled to open Oct. 28. There is still a small common area.

Junga remains an equity investor in the hotel but he is not in the management group.

Dillon asked if there was an ask of council. Long said the group would appreciate any ideas about providing funding for the completion of the project. 

"We'd like to see it kept under local control and management," Long said.

Dillon asked about a deadline for fundraising before foreclosure. Long said the answer depends a moving parts. He said if nothing is done and no progress is made, by the second quarter of next year an auction might take place.

"Given we have discussion underway with a guarantor investor to take out the bank's position and what kind of process we can make on the mezzanine loan, I think we're in pretty good shape," Long said. "We're not doing this because we think failure is imminent. We hope to win here. We're committed to giving this our best effort."

Councillor Mitchell suggested the bank might have liability for releasing funds to the contractor. She asked what kind of help the city can provide.

"We're rooting for you," Mitchell said.

Councillor Kevin Camero-Sulak asked if a surety bond could have protected the process.

Long talked said he wasn't sure about surety bonds but said the group hoped to raise $3.7 million in equity and $6.7 million from banks. When the land  was bought in February of 2018, the only financing was a portion of the planned equity funding. It was enough to get the ball rolling. The project managers were impatient to get the ball rolling and concluded they could get the rest of the funding.

"Those assumptions proved to be difficult. They were we along developing the site and building bricks and mortar when equity funds ran out and bank financing hadn't yet been concluded and access to it wasn't yet available," Long said.

Mayor Marl thanked Long for his presentation and offered whatever assistance he could to help the project along.

Temporary Uses and Structures Zoning Ordinance & Structures Zoning Ordinance

Attorney Tom Forshee introduced the ordinance about "transient seasonal sales" and "temporary use" ordinance.

Forshee said the ordinance was required to make sure these pop-up businesses and sales didn't annoy neighbors and that they were tracked by the city. The language requires a permit reviewed by the zoning administrator.

Marl said he wanted to streamline the regulatory burden that exists in the city and this was an example of that.

Councillor Dillon asked about food trucks and whether or not they have to follow these rules, which include how many weekends a year the sales can be held

Attorney Forshee said he didn't see this ordinance disturbing the food truck ordinance.

Dillon asked who determines if a sale disrupts a neighbor. Forshee said that would be the job of the zoning administrator.

Dillon asked about the permit cost. Interim City Manager Mike Greene said the permit fee has not yet been set. Greene said it would minimal.

Dillon said 45 days was a long time to have fireworks set up in your neighborhood or a Christmas tree sale. She questioned the time frame. She said you could have a 45-day sale twice a year.

"It seems excessive to me," Dillon said.

Greene said the time frame was set by the code review task force.

Councillor Mitchell said she found it ironic that we're cutting red tape to help downtown businesses while creating new hoops to jump through. She asked if the Main Street director was consulted.

Greene said Holli Andrews, executive director for Saline Main Street, was not consulted.

Forshee the language gives business owners the chance to have multiple sales on the same permit.

Mitchell said she wanted input from local business owners and people who've run pop-ups.

Greene said he had not. 

Councillor Camero-Sulak asked if a downtown business wanting a tent enclosure would be impacted by this ordinance.

Foreshee said that would depend on the use. He said this provides flexibility to allow businesses to do something out of the ordinary for a limited use of time. 

Council voted 6-1 to approve the ordinance on temporary uses and structures, with Dillon voting no. 

Council voted to approve ordinance 820 on garage sales and business licenses.

Eastlook Drain Special Assessment

Council took another step toward's creating a special assessment district to deal with drainage issues on Eastlook and Marlpool drives.

Council considered passing a resolution to create special assessment and have a public hearing on the proposal.

Attorney Roger Swets said $2,598 will be assessed to each property over five years.

Dell'Orco said he felt strongly there should be some public contribution to the process. Girbach said the city engineer's work on the project is a public contribution.

Councillor Dillon asked what happens if the costs are higher? Swets said that's a decision for council, which could raise the cost of the assessment.

Dillon said she was concerned about a recent track record of cost overruns. Answering a question from Dillon, Engineer Jeff Fordice said it would probably be a spring construction project.

Councillor Mitchell asked if the city needed to issue permits for anything that changes the grade of land. The city allowed the sheds to be built, she said, and as a result several neighbors have to pay $500 a year for 5 years to take care of the drainage issue.

Councillor Camero-Sulak said he'd like to see the project begin sooner than later, given the water's proximity to Mr. Slusinski's home.

Councillor Girbach said he felt this was a fair way to solve the problem without forcing Mr. Slusinski to take the other property owners to court.

Mayor Marl asked if there was a way to expedite the project. Marl said he, like Dell'Orco, to have some city contribution to the project.

Council voted 5-2 to pass the resolution. Mayor Marl and Councillor Dell'Orco voted no. A public hearing will be held Nov. 9 at Saline City Hall.

WWTP Change Order

Council voted 7-0 to approve a change order to for repairing the rotating biological contactor in the wastewater treatment plant.

Consent of Surety to Final Payment on RBC Drive Replacement

Council agreed to pay $109,000 as the final payment to TetraTech for work on the RBCs at the wastewater treatment plant.

Commission Reports

Councillor Dell'Orco said the environmental commission delivered batteries for recycling. He said the battery recycling program at city hall may require citizens to collect lithium batteries separately.

Councillor Girbach said the PUDs for Layher Farms and Fairdene were extended due to the pandemic.

Councillor Dillon said as of Oct. 1 Saline has an 81 percent response rate to the Census. She advised people to complete the census at 2020census.gov.  Dillon the city manager search committee. The finalists are Village Dundee manager David Uhl, Fenton assistant manager Michael Hart, Durand city manager Colleen O'Toole, and Northville Township manager Todd Mulcher.

Interviews will be conducted at 6 p.m. Oct. 12.

Reports and Other Announcements

Councillor Christen Mitchell said someone tripped on a sidewalk in front of Curtiss Bluffs.  Mayor Marl said a hot patch could be placed to temporarily repair the trip hazard until the sidewalk is replaced.

Water and Wasterwater Update

 Superintendent Steve Wyzgoski said valves were closed as the DPW begins a hydrant flushing program tonight. The directional changes of the water likely caused many of the problems with discoloration reported Monday. Flushing could help clear up cloudy and discolored water.

The bioscrubber is not running at full capacity at the wastewater treatment plant.   Wyzgoski said he reached out to ENL about getting the issue fixed. Girbach said the city may have to consider fixing the issue and deal with ENL later. Dillon agreed with Girbach. 

Mitchell said perhaps it was time for council to work with a different contractor for a biosolids study.

Greene suggested keeping Tetra Tech for the study because it conducted the siting study and could complete the project quickly.

Mitchell said bids can take longer, but they were the right way to go.

Camero-Sulak agreed with Dillon and Girbach about needing to move forward on repairing the bioscrubber.

Camero-Sulak asked about the fence issue with Bonnie Armbruster, who has requested screening so she doesn't have to see the wastewater treatment plant. Interim Manager Greene said adjacent property owners aren't interested in a fence, but want money spent on the odor issue. Camero-Sulak said he thought council needed to make a decision on the fence at the next meeting.

Downtown Recovery Zone

Greene reported this last week was slow due to the rain.

Councillor Girbach asked if there were concerns about heaters on the sidewalks. Green said there were not, but that it would run by Fire Chief Hoeft.

Dillon asked if the recovery zones will be changed by the Michigan Supreme Court's decision to overturn Gov. Whitmer's executive orders. Greene said that was being studied and the city would continue with the status quo until they know more.

Dillon asked for data from businesses so council could decide if the recovery zone has worked

Henry Street and Ann Arbor Street Intersection

Councillor Girbach said he was fine with moving forward with changes to improve sightlines at the intersection. He said he wanted a four-way stop at the intersection. Dillon, Dell'Orco, Marl, Mitchell and Camero-Sulak agreed.

Councillor Ceo disagreed. He said installing a four-way stop without it being warranted by the uniform code of traffic control could invite liability if there is a crash that causes a serious injury.

Public Comment

Mary Hess said she was surprised council adopted the ordinances on a first reading. On the hotel issue, Hess said it appears the cart was put before the horse. Hess said the Saline Lodging Group put down $500 on a $50,000 tax bill.

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