Council to Consider Halting All Redevelopment Downtown

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Monday, June 3, 2019, 7:45 am
Alice Dreger

At its meeting tomorrow night, East Lansing’s City Council will consider a moratorium on proposal and construction of new buildings in the Downtown Development Authority (DDA) District. The move comes as a surprise, and is angering some.

The DDA district includes hundreds of properties stretching from just west of Peoples Church to Hagadorn Road, as shown in this map:

Ordinarily the DDA is asked to weigh in on almost everything in the District, from alcohol licenses to dumpster usage. But the DDA has not been consulted by Council or City staff on this.

DDA Chair Peter Dewan, Vice Chair Jim Croom, and Treasurer Jeff Kusler all tell ELi that they did not even know such a moratorium was being considered. Says Dewan, “The City needs to encourage responsible development that contributes to the downtown.”

Robert Phipps is a former East Lansing Mayor whose company owns major commercial properties in the DDA District. Phipps tells ELi the message of a redevelopment moratorium to business owners is a negative one, on top of what he sees as the negative message of the new income tax.

Phipps believes this move suggests very poor leadership on the part of Mayor Mark Meadows, saying it is “time for him to retire. In my opinion, Mark is a very nice man but has done a horrible job as councilmember and now Mayor.”

East Lansing realtor Dave Ledebuhr of Musselman Realty, who also owns commercial property in the area targeted, told ELi that he sees “no reason” to adopt a moratorium. He asked rhetorically, “Why send a signal that we are not a City open for business!!”

Where did the moratorium idea come from?

At the May 14 nonvoting meeting of City Council, Meadows suggested the idea of the moratorium. When Council members Shanna Draheim and Erik Altmann (below) indicated they thought the idea required more discussion at a later date, Meadows seemed to agree.

But then this week’s Council agenda came out on Friday containing two draft versions of a moratorium resolution on the consent agenda.

Both versions direct City staff “to not accept or process…any applications for site plan approvals or building permits for the construction of a new building within the DDA District” through September 11, 2019. (If adopted as now worded, a moratorium would apply only to new buildings, not to renovations of existing buildings.) Extensions could be voted through after that.

One version of the moratorium resolution covers all properties in the DDA District. The other exempts the publicly-owned DDA’s Evergreen Avenue properties, currently under contract with developers Royal Properties and Vlahakis Redevelopment. (A substantially revised site plan from these developers is expected on or about June 21.)

A moratorium because of form-based code?

A major reason for a moratorium given by Meadows at the May 14 meeting (below) and also given in the draft resolutions is that the City is currently working on development of a form-based code for a large swath of the downtown.

This would be a new zoning code that, according to the draft resolutions, would “regulate the configuration, features and functions of newly constructed buildings in the DDA District as well as other aspects of the site plan.”

The idea of the moratorium is to stop new construction until a majority of City Council has decided what it wants in the form-based code.

Because a form-based code would establish aesthetic and functional design requirements for all new construction in whatever zone is designated, a moratorium could mean something much more significant for new projects than just a delay.

But it seems highly unlikely, given the complexity of form-based code and City leaders’ stated desire for significant public input on it, that the code will be adopted by September 11.

Deliberations on the code have been going on for months in a committee of the Planning Commission. As Planning staff member David Haywood has put it, the draft code is a “dense document” with enormous amounts of detail.

At the May 14 meeting, Altmann referred to the form-based code as a “huge project” and indicated he expects the process to take a long time. Altmann insisted the form-based code has to be done right. Altmann cited the Center City project (below) as evidence of a "nice-looking building" created without the form-based code in place.

Meadows agreed that, if the new code will govern redevelopment of East Lansing’s downtown for 50 years, the City needs to take all the time necessary to get it right.

Why else might a moratorium be under consideration?

A second motivation for the moratorium, stated in a cover memo from Planning Director Tim Dempsey but not included in the draft resolutions, is “growing concern regarding the amount of multi-family housing development in the marketplace.”

ELi reported that the issue of rental housing market saturation has been discussed at Planning Commission. Dempsey now suggests the City obtain “a comprehensive housing study” to consider “housing supply and demand” before more downtown housing is built.

Without wanting to say so on the record, some people have speculated that the real impetus for the moratorium is November’s election.

Meadows, Altmann, and Draheim are all running for re-election, and a moratorium could mean a quieting-down of development-related controversies in the run-up to the ballot.

Longtime local political analyst Mark Grebner told ELi yesterday that he finds that a reasonable theory. “People don’t like to do controversial things when they are running for re-election.”

Hold everything until Council figures out what it wants downtown?

Ledebuhr told ELi yesterday that it “makes no sense to postpone business as usual! We have a Master Plan that many people worked on” for years, and that, he says is the tool “to consider when making informed decisions.”

Phipps also says that it makes no sense: “They should not penalize property owners while and until the city figures out what they want to do. … If the city is behind in times, that is their fault, not the property owners.”

Earlier this year, Meadows, Altmann, and Council member Ruth Beier pushed through two new ordinances (1443 and 1449) allowing for increased height in parts of the DDA district. At that time, the three-member majority did not see a reason to put off new projects or major zoning changes while the form-based code is worked out.

But now, it seems, there may be majority Council interest in a moratorium.

Update: This issue disappeared entirely from the agenda just before the Council meeting. Read more here.


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