Mayor McLallen called the meeting to order at 7:45 p.m.

CITY COUNCIL: Mayor McLallen, Mayor ProTem Crawford (arrived 8:05 p.m.), Council Members DeRoche, Kramer, Lorenzo (absent/excused), Mutch, Schmid

PLANNING Chairperson Weddington, Members Bononi, Capello (arrived COMMISSION: 8:10 p.m.), Canup (absent), Churella (absent), Csordas (absent), Hoadley (absent), Vrettas (absent), Watza (absent)

CM-98-05-166: Moved by Mutch, Seconded by DeRoche, CARRIED UNANIMOUSLY: To add Warrant 518 to the agenda

AUDIENCE PARTICIPATION:

Mayor McLallen asked the members of the audience to introduce themselves:

John Beckett - Beckett & Raeder, Inc.

Sheri Webster - Novi Town Center

Paul E. Bauman - Reid Lighting

Tom Marcus - Town Center Steering Committee

Rod Arroyo - Birchler Arroyo

Cathy O’Mally - Twelve Oaks Mall

Eleanor Rzpecki - EDC

John J. O’Brien - Sullivan Funeral Home

Ed Kriewall - City Manager

Anamaria Kazanis - EDC & Beautification Commission

Bill Wenzel - EDC

Blair Bowman - Expo Center and representing properties along Grand River

Linda Lemke - LCL & Associates

Les Gibson - Finance Director

Tony Nowicki - Public Service Director

Phil Covell - FPS, Inc.

Kamran Qadeer - FPS, Inc.

Bill Knighton - Beckett & Raeder, Inc.

Lori Ward - Beckett & Raeder, Inc.

Hugh McVeigh - 27070 Taft Rd., Novi 48377

ITEMS FOR DISCUSSION AND/OR ACTION:

1. Grand River Corridor Study

Mayor McLallen explained although Grand River is a major corridor through Novi, most everyone agrees that it does not present a satisfactory image for the community. She further explained that the purpose of tonight’s meeting is to determine possible design and funding alternatives for improving Grand River Avenue.

Jim Wahl advised this is the first time that the city has looked at the Grand River Corridor at this level of detail. He recalled they have conducted some planning and zoning studies in the mid 1980's and that they update the Thoroughfare Plan whenever they update the Master Plan. Mr. Wahl added that the Grand River Corridor Committee came forward in 1992 with series of recommendations that basically put forth the need to do this kind of work. Mr. Wahl advised this study is currently a priority for the Planning and Community Development Department and the Department of Public Services because the Grand River Corridor is considered to be a key community development segment of the community.

Mr. Wahl noted Council’s several of their goals during the Goal Sessions was to address the aesthetic quality of the community, that there was a need to have designated economic and community development areas, and there was a need to address the traffic challenges. Mr. Wahl believes these goals all pointed directly to this project.

Mr. Wahl advised that the study before them is a conceptual design and engineering study, and is not a final step in a planning process. He further advised they are modeling this project in the same way they planning the Main Street project. He noted they are currently trying to answer the basic questions that have to be addressed before they can begin discussions about construction. He added there is a hand out outlining some of the workshops and studies that were completed during 1997 which helped develop some of the conclusions in the draft report.

Mr. Wahl introduced Mr. Qadeer who conducted the right-of-way study.

Kamran Qadeer, Engineering Consultant for Finkbeiner, Pettis & Strout, Inc. gave a summary of their report. He noted that their recommendation is based upon all the special assessments along the Grand River Corridor and based upon the analysis of the whole project.

Mr. Qadeer reported the limits of the project are Haggerty Road from the east and Wixom Road to the west. He noted it encompasses approximately 5.4 miles of corridor and has three distinct traffic segments. They are: Haggerty Road to Meadowbrook Road, Meadowbrook Road to the bridge over the CSX Railroad tracks, and from the bridge over the CSX Railroad tracks to Wixom Road. Because the current traffic volumes are at and more than capacity, Mr. Qadeer recommends road improvements for certain sections of the corridor. Of the eight intersections, Mr. Qadeer reported that the Haggerty and Novi Road intersections are the busiest and need improvements to make them functional.

Mr. Qadeer reported they have established the year 2020 as the year on which their designs are based. He explained they took the traffic counts at various locations throughout the corridor and used a 3% growth rate compounded annually to determine their future traffic projections. He added they also considered the various improvements outlined in the Master Plan,and the improvements for the Beck Road and Wixom Road interchanges.

Mr. Qadeer believes that both a five lane road or six lane boulevard will meet the projected traffic counts for the year 2020. Mr. Qadeer noted that a five lane road requires 120 feet of right-of-way and will need an additional ten feet on each side of the road. He added that a five lane road will impact eight structures. He further noted that a six lane boulevard will require 180 feet of right-of-way and will need an additional forty feet on each side of the road which would impact thirty eight structures and require a lot of utility relocation. Mr. Qadeer advised because of the impact of a six lane boulevard, they would recommend the five lane alternative.

Mayor ProTem Crawford arrived at 8:05 p.m.

John Beckett of Beckett & Raeder, Inc. reminded Council that the report before them is a draft. He explained they will publish the final report after they gather more input and noted that is one purpose of tonight’s meeting.

Mr. Beckett advised that the study began with a public workshop session in May 1997 in which all of the Grand River Corridor property owners were invited. He explained the purpose of that session was to gather initial input to guide the study. He reported the participants all agreed that the road is currently in a state of transition in terms of types of buildings and uses. He added they also agreed that the perception of Grand River Avenue reflects on the entire image of the community.

Mr. Beckett reported some of the concerns of the participants were: too many curb cuts; bad perception; failure to upgrade the corridor; not pedestrian friendly; not enough cooperation between the property owners and how they interact with the city; inconsistent zoning and lack of funding.

Mr. Beckett reported some of the needs expressed were: bury utility lines; construct sidewalks; provide trees and landscaping in the rights-of-way; need for a uniform identity; develop unity among uses; provide attractive lighting; standardize signage; enhance woodlots and wetlands; develop an appropriate look; and make the corridor more user friendly.

Commissioner Capello arrived at 8:10 p.m.

Mr. Beckett reported the participants believed some of the strengths of the corridor were that the corridor is in an excellent location in terms of accessability to other roadways, the demographics are growing rapidly, disposable income is increasing and the area is an ideal setting for business development. He added that the property that is becoming available or is currently vacant is significant in size and offers many development opportunities.

Mr. Beckett advised they also researched the identification and documentation of some of the important characteristics of the corridor. He explained those conclusions fell into two categories. He advised one category was the perceptive elements that included existing conditions and the second category was the physical elements such as the lack of landscaping. He then explained some of their recommendations and strategies found in the report are to help guide the future development of the corridor.

In terms of the framework organization, Mr. Beckett recommended that they accentuate the community entrances as a way of creating important focal points within the corridor, accentuate the corridor intersections and provide an emphasis to the Town Center area as the main focus for the corridor.

Mr. Beckett advised that the next step would be to make recommendations for individual properties once there is a consensus made as to the type of strategy the city would like to pursue.

Mr. Beckett added the building of the road and the development of the right-of-way is a major undertaking, and estimated it is a $40.0M project. Consequently, Mr. Beckett believes funding is critical and may be the most important part of the study. Mr. Beckett then introduced Lori Ward, who will present various funding options for the Grand River Corridor.

Lori Ward of Beckett & Raeder, Inc. presented potential primary and secondary funding sources. She reported the options for primary funding sources are: General Obligation Bonds; Tax Increment Financing (TIF); Brownfield Redevelopment Act; Special Assessment District or Principal Shopping District; or a Capital Improvement Program.

Ms. Ward understands they are already familiar with GO Bonds and believes the city recently issued some GO for some other road improvements in the area. She added that she believes this would be one mechanism for funding the major roadway improvements.

Ms. Ward reported Tax Increment Financing is a mechanism developed to help shoulder the burden of some of the public amenities for community development. She explained they could take any geographic area to become a district. She reported that the total value of the properties within that area is totaled to serve as the base year. Ms. Ward explained any changed values would rise above that base year and all would be eligible for capture by the Tax Increment Financing District. Therefore, the city, the county and all of the affected taxing jurisdictions would have all of the revenues until the year the base year was established. She advised that anything generated after that year is then collected by the Tax Increment Financing Authority. She said they would recommend a downtown development authority or they could establish an LDFA which is primarily used for industrial.

Ms. Ward explained the authority would then use the captured funds for redevelopment projects within the geographic area. Consequently, there would be no new millage or new assessment. She added that it would not be taking away any revenue that had been previously generated by the taxing jurisdiction. She explained they would be capturing any new development that occurs on top of that. Ms. Ward added that the idea behind a TIF is that the increase in the captured value or anything above the base year is put back into the geographic area and will help the property values continue to rise. She explained this would create more money for more projects with the eventual hope that they are so successful that they put themselves out of business so that they do not need to capture any longer.

Ms. Ward advised they can define any term (i.e., 5,10, 15, 20 or 30 years). She added that Tax Increment Financing Districts often issue bonds based on future projections of the growth in the geographic area. Therefore, she believes they would want to make certain that they give themselves enough time to pay off those bonds and is why many projects have a longevity of 30 years.

Ms. Ward stated once the revenues are collected, the Downtown Development Authority (DDA) that is in place to regulate these types of districts is paid in several different ways. She explained they can develop either a pay as you go project or issue bonds.

In addition, Ms. Ward reported that schools are no longer affected. She explained they have changed how TIF’s are constructed and they no longer are able to capture school revenues. Ms. Ward added although they are able to collect from the other taxing jurisdictions, the jurisdictions are not required to participate. However, she reported they have gotten good feedback thus far from them and therefore, this option is a good possibility for the Grand River Corridor improvements.

Ms. Ward advised requirements for establishing a DDA are that they would have to prove that this is a commercial in nature, the land use has to be planned for and currently used in a commercial situation (industrial, commercial or office), there must be deteriorating properties, environmental contamination, declining property values, a high degree of vacancies or under developed property. Ms. Ward reported they are confident that there are enough properties in the Grand River Corridor that fit these requirements.

Ms. Ward added they also have the ability to levy an unvoted 2 mil with TIF’s and they are currently in the process of researching how they would achieve that. She noted this 2 mil could be used for operations or redevelopment projects. She noted they can levy all of the 2 mil or a portion of it. She further noted that the 2 mil area does not have to be the same as the DDA’s boundaries.

Ms. Ward reported a Brownfield Redevelopment Authority is similar to a TIF but revenue must be used for environmental purposes. She added that it can be used for all of Novi or for a single site. In addition, Ms. Ward advised that they are able to capture school taxes in this situation and the state will then reimburse the school districts.

Ms. Ward advised both a Special Assessment District or a Principal Shopping District are based on the premise of levying millage in a geographic area. Ms. Ward reported that the Principal Shopping District differs in that it allows the authority that is regulating it to levy special assessments based on the extent to which the properties benefit from the plan so that they do not assess the properties in the same way. She added that there is a maximum of $10,000.00 charged per business for a Principal Shopping District and added that amount can be negotiated.

Ms. Ward reported that they believe a Capital Improvement Program can be a primary and a supplementary tool in that the project should be in the city’s CIP to allow for long range planning.

Ms. Ward reported secondary funding sources are: grants (i.e., Michigan Jobs Commission, Michigan Department of Transportation, and Michigan Department of Natural Resources); private donations (i.e., Wal-Mart, Target), and utility company contributions.

Ms. Ward advised because of the cost associated with this project, that it will require the packaging of a series of these financial sources.

Mayor McLallen understands that they project this to be a twenty year project and asked whether they have identified any of the segments as a priority. Mr. Beckett believes any project begins with the implementation of a strategy for the roads. Mr. Qadeer advised that analysis has shown the Novi Road and Haggerty Road intersections as currently being impacted the most.

Khanh Pham reminded Council that Grand River is a County road and they are currently in the process of making improvements at Beck and Wixom roads.

Mr. Wahl added that a proposal has recently come forward for the Bates Hamburger site and therefore, they really need to look more closely at that intersection. He added that they have asked Mr. Arroyo to look at the specifics of the individual intersections as opposed to the study, which provided a general overview. In addition, he recalled that Council directed staff to review mast arms and advised they have looked at them as a part of this project.

As decision making bodies, Mayor McLallen believes their purpose is to provide further specific direction to the staff and consultants at this point.

Councilman Schmid asked whether they have made any projections as to the potential of the various funding sources? Ms. Ward replied that would be their next step.

Councilman Schmid asked whether they could estimate what a TIF would generate. Ms. Ward estimated that it would generate $5-6M. She added the timing is right for a TIF because of the declining values in the corridor area.

Mayor McLallen believes the two bodies also have to provide direction to staff and the consultants about what funding sources they would like more information on.

Councilman DeRoche believes the roads are a priority and that it is important to solicit strategic partners as they continue this discussion.

Mr. Pham advised they will work closely with the County to help fund the road improvements. However, he reminded Council that they need to have a package of funding to support the type of development that they want.

Because it is a County road, Councilman Kramer believes they must put significant effort into ways of capturing county, state and federal funds. He suggested that a TIF be aimed at the amenities and added that he would like to minimize the cost to Novi’s taxpayer contribution to the roadway.

Councilman Kramer continued by stating his basic concern about the road is that they work with the corridor’s environment. He explained that he would like an opinion about how the five lane works with the character of the corridor. Councilman Kramer would also like to know whether the bridge design improvements are compatible with the types of improvements recommended for the corridor.

Mayor McLallen agrees with Councilman Kramer’s comments and noted that the State of Michigan is not represented tonight. She added that the road is in its current state of disrepair because of the State’s negligence.

Councilman Kramer would also like further information about how the financing will work over time. Further, if they agree to formulate a DDA, he asked whether they need to set some constraints on the amount of bonding the city would permit them to apply for so they can limit the city’s liability. Councilman Kramer understands that a DDA is somewhat independent.

Ms. Ward reported that the city has the authority to limit the DDA’s bonding capacity.

Mayor McLallen believes they need to determine the areas in which they will direct staff and consultants to focus on further.

If they create a TIF and DDA, Mr. Wahl advised that a substantial part of that money would come from taking city money from one area and putting it in another. He explained they would be taking General Fund revenues that could be used for a variety of functions and allocating it to Grand River improvements. Mr. Wahl added although they can set the amount, it is an issue.

Mr. Wahl reported that a DDA is totally independent, but it does not have to be. He explained they could appoint the EDC and Community Development staff to serve on this board instead of creating a new bureaucracy.

In terms of the road funding issue, Mr. Wahl noted they have provided a list of ten projects identified by the Oakland County Road Commission in 1992 and Grand River does not appear on their priority listing. Therefore, Mr. Wahl believes they need to find strategies to change the County’s priorities.

Councilwoman Mutch understands the main difference between a TIF or just committing a certain amount from the General Fund is that they can only make General Fund commitments from one year to the next. However, she understands that a TIF permits them not only to take the revenue that would be going to the General Fund, but also permits them to take funds from the other taxing jurisdictions. Mr. Wahl agreed. He added the key advantage is that they are targeting an area, generating resources from an area and then turning it back to the area. However, he believes most of the revenue would still come from the city.

Councilwoman Mutch believes the alternatives offer an all or nothing plan. However, she would like further information that reflects not only the current use, but the expected use in terms of the traffic. She explained not all of the traffic enters the city at Haggerty Road and exits at Wixom Road. She would like further information on the current traffic pattern and how it would change if this corridor develops according to the Master Plan. She added that she believes they also need information about whether there is justification to vary the width of the road along the corridor.

Councilwoman Mutch also believes the historic buildings located along this corridor are another asset of the community and that they need to be addressed as a part of this study.

Chairperson Weddington believes that these improvements cannot happen fast enough and that the improvements will enhance the city. She added that she personally would like to see the corridor developed as a boulevard, but understands that is not realistic because of the many constraints that currently exist.

Chairperson Weddington asked whether there are further disadvantages to a TIF? Ms. Ward advised that the biggest drawback was the impact to the schools. Other than that, she cannot think of any other disadvantages at this point.

Mr. Pham added that he believes the greatest disadvantage would be if they could not fund the entire corridor with a TIF. He explained they could face the problem of an inconsistent streetscape design along the corridor.

Commissioner Bononi is not sold on the alternatives presented in the study. She explained that the widening of the road does not encourage motorists to stop and stay in Novi. She believes because it encourages motorists to drive through, she is concerned about the businesses. Commissioner Bononi believes the purpose of Main Street is to coax people to stay and not encourage them to speed through.

Commissioner Capello supports a six lane boulevard. However, he can foresee that Meadowbrook Road to west of the CSX bridge can only support four to five lanes. He added that he believes the property owners should pay for some of the amenities because they will gain the benefits from the improvements.

Mayor ProTem Crawford believes the Grand River Corridor could be the heart of the community and added that it also connects to many other roads in Novi. He believes Grand River is an untapped asset and he hopes they can find a funding solution. Mayor ProTem Crawford supports a five lane road. He then suggested that they start from Grand River and Novi Road, and work outward.

Councilman Schmid asked whether they have studied the traffic patterns in the corridor? Mr. Qadeer replied they have conducted actual counts and discovered that many sections of Grand River are inadequate. He added that the 3% growth projection may even be too low.

Chairperson Weddington believes the initial question is what is their vision for Grand River. Chairperson Weddington supports beginning the improvements at Grand River and Novi Road and moving out to take advantage of the work the County is planning.

Commissioner Capello agreed and added that he believes it would make sense to take advantage of the funding that is already going toward the Wixom to Beck area. He suggested that they should perhaps look for additional funding in the northwest corner where there are plans to develop an interchange before it gets developed outside the city’s control.

Councilman Kramer agreed.

Because of the State’s negligence, Councilwoman Mutch believes they should document how an I-96 lane blockage affects Grand River and other roads in the community. She explained since Grand River serves as an alternate route for I-96, they should be more assertive in getting funding from the State for its improvements.

Although this may be beyond the scope of this study, Councilwoman Mutch believes they also need to consider how the zoning on the south side of Grand River is adjacent to residential zoning. She believes the city needs to address how they will separate Grand River from those residential backyards.

Mr. Pham agreed they must integrate land use with transportation needs. However, he noted that the scope of the study was to determine the right-of-way and the needs of the capacity for the Grand River Corridor. He believes thirty eight existing structure conflicts compared with eight existing structure conflicts speaks for itself. Councilwoman Mutch believes it depends upon where the structures are located.

Mayor McLallen believes the primary concern is the image they want to project for the Grand River corridor. She added that she believes there is a commitment to set aside some city funding and the question is whether a $2.0M annual commitment is reasonable. She restated that she believes they need to provide direction about how staff and the consultants should proceed in terms of the design elements.

Mayor McLallen believes the next challenge is timing. She explained they already know that there are plans for improving the bridge and consequently, that presents an issue west of Beck Road. In addition, the Mayor advised there are currently development initiatives in the Main Street area and without a plan, the city will not be able to attract the kinds of businesses that they want.

In addition, Mayor McLallen believes they always come back to how they are going to manage the funding and she believes they also need further information about the funding opportunities that are available.

Mayor McLallen suggested that they determine whether they will need to formulate a subcommittee to develop the specific components.

Commissioner Capello believes the formulation of a subcommittee is in order and that it should consist of representatives from Council, the Planning Commission, Providence Hospital, and the Town Center Steering Committee.

CM-98-05-167: Moved by Capello, Seconded by DeRoche, CARRIED UNANIMOUSLY: To formulate a subcommittee consisting of a representative and an alternate from City Council, the Planning Commission, Providence Hospital, the Town Center Steering Committee, Main Street developers, affected landowners, and staff to further investigate the proposed improvement and funding alternatives along Grand River Avenue from Haggerty Road to Wixom Road keeping in mind that they need to move forward quickly in the area between Wixom and Beck Roads and provide a report to Council within forty five days

COUNCIL DISCUSSION

Mayor ProTem Crawford believes there is a general consensus about improving the Grand River Corridor. However, he believes the first thing the committee should address is the additional traffic patterns of ingress and egress to Grand River, and other funding mechanisms.

Mayor McLallen believes they need to clarify whether there is funding left for further studies. Mr. Beckett understands the original funding is spent.

Mr. Wahl reminded Council that they budgeted $10,000.00 to keep this process going and suggested that they use that fund to determine where they should go from here.

Mayor ProTem Crawford thinks it is important to first determine what kinds of funds will be available for the corridor improvements (i.e., DDA, TIF).

Mayor McLallen advised that is one assignment of the subcommittee.

Mayor McLallen asked the landowners attending tonight’s meeting to provide some input:

Paul Bauman of Reid Lighting believes the current problem on Grand River Avenue is that most motorists use it to avoid traffic on I-96. Mr. Bauman is concerned that if they make these improvements to Grand River, they will still have traffic problems resulting from I-96 congestion and that it will encourage additional traffic to travel on Grand River. Mr. Bauman suggested that they lower the speed limit because the current traffic travels too fast.

John O’Brien supports a five lane road and reduced speed limits. He added that he believes a boulevard is too dangerous.

Tom Marcus believes they should pressure the state for funding.

Mr. Kriewall advised they need to wait for the state’s funding to catch up with the rest of the state. He explained that this road will probably qualify in the near future for state and federal funding as all the other roads do. He believes they should wait for this because it is out of the question for Novi to fund these improvements. He noted this could take as long as five years. Mr. Kriewall believes the state has underfunded road improvements for the last ten to fifteen years and now the situation is out of control. Therefore, he would agree that they need to put pressure on the state legislatures to fund road improvements.

In order to have a true Main Street area, Anamaria Kazanis supports reduced speed limits by providing pavers at the Novi Road and Grand River intersection.

Councilman Kramer believes the committee should be action based in the short term. However, he further believes Council needs to set priorities for the committee for the long term so they can make near term decisions (i.e., appropriateness of the bridge design, determine need to interact with State for Beck and Wixom, Main Street initiatives).

Councilman Kramer believes they need to identify the viability of a DDA as a midrange target.

Councilman Schmid believes the committee should first explore where the funding is coming from to avoid hodge podge development.

Mayor McLallen asked if it is reasonable to ask the consultants to come back within thirty days with further information.

Commissioner Capello suggested that the consultants provide the report to the committee and then the committee could then bring that information back before Council.

Because a majority of the Planning Commission is not present, Councilwoman Mutch believes they may appreciate further discussion among themselves and that thirty days may not be sufficient.

Mayor McLallen suggested that a function of the subcommittee would be to refine the information based upon preliminary discussions and bring forth a more specific document. Mayor McLallen asked whether the consultants have the ability to organize and bring back information addressing the concerns raised tonight within thirty days.

Mr. Beckett replied they would agree to continue researching the TIF opportunities. Assuming they can have access to the assessor’s records, Mr. Beckett believes they can provide a report within thirty days that would describe the potential projection of what the generated revenues will be.

Mayor McLallen added because the TIF is a Council issue that the report should be brought back before them.

Councilwoman Mutch would like the committee to provide an opportunity to get other input and then make their best case for the various alternatives. Councilwoman Mutch explained she believes there are other committees or individuals beyond this subcommittee who can offer further input.

Mayor McLallen stated there is a motion on the floor to formulate a subcommittee with a member and alternate from Council, the Planning Commission, landowners in the corridor, and staff to dissect tonight’s conversation further. She explained they will separate the Council issues from the planning issues. Further, she advised that the consultants have agreed to provide an analysis of the different revenues that can be generated from the various funding options within thirty days.

Commissioner Capello suggested that they come back before Council in forty five days. He said the consultant’s would report to the subcommittee and the subcommittee can then give a full report to Council.

Nays: None

Mayor McLallen asked that volunteers for the committee contact Mr. Pham.

Councilman Kramer volunteered to serve as the Council representative and Mayor ProTem Crawford volunteered to serve as the alternate.

Commissioner Capello volunteered to serve as the Planning Commission’s representative.

CM-98-05-168: Moved by DeRoche, Seconded by Crawford, CARRIED UNANIMOUSLY: To approve Warrant 518 on the condition that Council’s rules be reviewed to determine whether Council is permitted to amend the agenda when a full Council is not in attendance

AUDIENCE PARTICIPATION - None

ADJOURNMENT

There being no further business before City Council, the meeting was adjourned at 10:07 p.m.

Mayor City Clerk

Transcribed by:

Barbara Holmes

Date Approved: June 8, 1998