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HomeMy WebLinkAbout2020-09-09 CITY OF LIVONIA — CITY COUNCIL MINUTES OF STUDY MEETING HELD SEPTEMBER 9, 2020 Meeting was called to order via Zoom remote technology at 9:25 p.m. by President Kathleen McIntyre. Present: Scott Bahr, Cathy White, Brandon McCullough, Rob Donovic, Jim Jolly, Laura Toy, and Kathleen McIntyre. Absent: None. Vice President Bahr led the meeting with an Invocation. Elected and appointed officials present: Mark Taormina, Director of Planning and Economic Development; Todd Zilincik, City Engineer; Paul Bernier, City Attorney; Lynda Scheel, Treasurer; Connie Kumpula, Chief Accountant; Tom Hritz, Accountant II; Casey O'Neil, Director of Information Systems; Jacob Rushlow, Superintendent of Public Service; and Doug Moore, Assistant Director of Public Works. Councilmember Donovic gave a shout out to his brother who is starting seventh grade at Frost Middle School where all of his siblings attended. Councilmember Toy stated she attended Frost as well. During Audience Communication Lisa M. addressed the issue of late starts to the Study Session. President McIntyre responded to the comment. NEW BUSINESS 1. REQUEST TO WAIVE THE SIDEWALK REQUIREMENT: Scott Morgan, Soave Homes, re: for the home to be constructed at 29614 Greenland. Scott Morgan, Soave Homes, presented this request to Council. He stated this and the next item are regarding two properties that they have that they are requesting sidewalk waivers for, those being 29614 Greenland, 29648 Greenland, and stated there are no sidewalks on Greenland between Henry Ruff and Middlebelt in that area, it's more of a rural setting. They are requesting the waivers because there's nothing to connect it to. Vice President Bahr offered an approving resolution for the Consent Agenda. Councilmember Toy requested it be put on the Regular Agenda. DIRECTION: APPROVING REGULAR 2 2. REQUEST TO WAIVE THE SIDEWALK REQUIREMENT: Scott Morgan, Soave Homes, re: for the home to be constructed at 29648 Greenland. Scott Morgan, Soave Homes, presented this request to Council. Vice President Bahr offered an approving resolution. Councilmember Toy requested it be put on the Regular Agenda. DIRECTION: APPROVING REGULAR 3. REQUEST TO WAIVE THE SIDEWALK REQUIREMENT: Scott Morgan, Soave Homes, re: for the home to be constructed at 14950 Lyons. Scott Morgan, Soave Homes, presented this request to Council. Vice President Bahr offered an approving resolution. DIRECTION: APPROVING REGULAR 4. AWARD OF BID: Department of Information Systems, re: for the Data Center HVAC Replacement, from budgeted funds. Casey O'Neil, Director of Information Systems, presented this request to Council. He stated this item is a replacement for their Data Center air conditioning unit, the current unit is over twenty years old and at the end of its life. For the replacement they selected a Liebert model that's perfectly sized for their room and will be much more energy efficient than its predecessor. They placed this item on MITN and received nine bids back. They chose the lowest bidder, Tech Mechanical, they have a great deal of experience dealing with these types of units for other municipalities and have done work for Livonia in the past. Their bid was $42,000.00 which will come from budgeted funds. Councilmember McCullough offered an approving resolution for the Consent Agenda. The item is much needed and at end of life. Councilmember Donovic stated he had the good fortune of touring the air conditioner room when he first got on Council and he got to see some of the inner workings of the IT area and it's very impressive, the amount of data and machines that they have to monitor. Councilmember White asked what kind of warranty it has and O'Neil responded he believes it's a five-year warranty included with it. Councilmember Toy asked if this item relates to the downstairs and O'Neil replied it's particularly the computer room. Toy then asked if the IT Department was 3 intending to move from the basement and O'Neil replied if his department moves, the server does not have to move, they don't have to be right next to it as they would have fifteen, twenty years ago. DIRECTION: APPROVING CONSENT 5. REQUEST TO APPROVE AN ANIMAL SHELTERING AGREEMENT BETWEEN THE CITY OF LIVONIA AND THE MICHIGAN HUMANE SOCIETY AND WAIVE THE CITY'S FORMAL BIDDING PROCESS: Public Service Division, re: for the period January 1, 2021 to December 31, 2023, extending all terms and conditions of the current agreement. (CR 351-18) Doug Moore, Assistant Director of Public Works, presented this request to Council. He stated this item went to the Human Society about two months ago to start working on the extension. It's a two-year extension of the terms and procedures from the last two years. There's one minor increase that has to do with litters of wildlife, but other than that everything else is staying the same. Councilmember Jolly offered an approving resolution for the Consent Agenda. He stated he has reviewed this contract in the past and he's happy to see that nothing is changing in terms of increase in costs. Regardless of what the consumer price index might say, we all learn our lessons. Councilmember Donovic asked Moore about the monthly fees and the one that caught his attention was the fee beyond ten days will remain at $55.00 per day for animals and asked if the animal was there for 100 days, is there a limitation there for those animals on a daily boarding fee. Moore replied if there are animals that are left there it's usually has to do with a court case and when the case goes into court, they look to recover those fees through the judgment. So it's very seldom that the City has to end up having to pick those up. DIRECTION: APPROVING CONSENT 6. AWARD OF CONTRACT: Public Service Division, re: for the 2021-2024 calendar year requirements for the Portable Toilet Program, to provide portable toilet service, from budgeted funds. Doug Moore, Assistant Director of Public Works, presented this request to Council. He stated this is for a three-year program with Brendel, they are the City's current contractor, this was put out to bid in early August due to the pandemic. And the current contract with Brendel does not allow for units with hand sanitizing possibility, so we thought it best that we went after that, to have the hand sanitizers in each unit and while we were doing that we decided to update our list of needs because over the years it has morphed into hand washing stations and hand 4 sanitizing units and various other things, so it was time to bid this program out. Brendel was one of two bidders and they came in as the low bid. They have been very responsive in the fourteen years that we have worked with them. Councilmember McCullough stated that having a back-up with John's Sanitation seems like a good idea and he then offered an approving resolution for the Consent Agenda. DIRECTION: APPROVING CONSENT 7. REQUEST TO AUTHORIZE APPROPRIATION AND AMEND CONTRACT WITH ERG: Public Service Division, re: to provide payment for drop offs in August and September, in the amount of $50,000.00 and continue funding the Household Hazardous Waste/Electronic Waste Program for the year 2020, from budgeted funds. (CR 361-19) Doug Moore, Assistant Director of Public Works, presented this request to Council. He stated the Department came before Council in October of 2019 with a great way to do our household hazardous waste program, we turned it into a drop-off program with ERG. At the time we had budgeted $125,000.00 and then in March as everybody knows the pandemic hit and people started cleaning everything out. And because of that, we've run out of money and we would like to have funds for two months which would cover August and September's bills and the program will end on October 2nd for this calendar year. And then moving forward we have decided to put a limit on it from the first part of March to the first part of October each year. Vice President Bahr asked if the City's costs are based on the number of drop-offs or the amount of material and Moore replied it's based on the number of drop-offs, it's based on drop-offs but it's up to 100 pounds so if a resident goes in and has 105 pounds of material, we pay the first 100 pounds and then the resident has to pay for the extra five pounds at a set rate and he thinks it's 75 cents or $1.00 a pound, something like that. Bahr then asked if that's the case, does it really save the City money to close down for winter months and Moore replied to leave it open ended right now, we picked $125,000.00 originally because that was our costs for the two-day drop-off event and heading into this first year of the program we didn't have a clear idea of how things were going to work and then unfortunately when the pandemic hit everybody started cleaning which initiated a whole new set of problems so we weren't sure and that just threw a wrench into a plan that we didn't really have a good grasp on anyway because we weren't sure how many people would take advantage of the program. Bahr stated that he thinks the Department has been innovative in looking at this and he knows it's going to be relooked at it for next year, which is great, and asked 5 when the program is paused, what alternatives do residents have, do they have any other alternatives or do theyjust need to wait until the spring when the program is restarted. Moore replied they can continue to go to ERG and pay the fee themselves, or they can wait until we get going again in March. The other thing that the pandemic cancelled this year was the Wayne County drop-off, Wayne County usually had four of them through the year and because of the pandemic they weren't doing those events which created even more issues for us because those also helped siphon off some of the materials that would be dropped off at our event. Bahr stated he noted this money is coming from the Refuse Recycling Millage, and he assumes by the fact that you're asking for it that we've confirmed that we have plenty of cushion in there to absorb this and Moore replied yes, we do. Bahr said the reason for the question is that he was just thinking through from a cost saving perspective if it made sense to actually just pause the program now but considering the fact that we have the money for that purpose available and that's where it's coming from, he thinks it makes sense to do this understanding that we'll have more experience to base next year's decisions off of so he has no objection. Moore said one more thing he'd like to add, this Saturday there is the paper shredding and tire recycling day at the DPW Yard from 8:00 to 12:00, so this kind of runs hand in hand with Household Hazardous Waste. Councilmember White asked about the residents who want to drop off on times that aren't within the City's designated timeframe, and you said they would just drop it off with ERG and pay a fee, does that mean that they would pay for every pound then, so let's say they have 20 pounds they'd pay $1.00 a pound then, there's no payment other than what the resident pays, right? Moore replied correct. In the off months, the resident would be responsible for the fee to ERG. White then asked if it's still the designated amount, the $1.00 per pound? Moore replied he doesn't recall that amount offhand. DIRECTION: APPROVING CONSENT 8. REQUEST TO ADJUST WATER AND SEWER CONSUMPTION RATES, INDUSTRIAL SURCHARGE RATE AND INDUSTRIAL WASTE CONTROL CHARGE: Public Service Division, re: to become effective on October 1, 2020. DIRECTION: APPROVING REGULAR 6 Connie Kumpula, Chief Accountant, presented this request to Council. She stated that Tom Hritz and Jacob Rushlow are present for this item as well. She stated they are proposing a slight increase for annual rates for low, average, and high users which is about 2.19% overall for the average user. There are many variables that go into establishing the water rates and this really is her first year participating in the process so she really took on the role of reviewing the methodology and the input and Tom Hritz jumped in and he prepared the working grids, and many work grids are involved with this. And the reason for that is that Tom has been heavily involved with this process in the past, he was a water accountant for many years. He transitioned when she transitioned so it made sense this year given the year that we have had to rely on his experience and expertise. So with that it makes more sense for him to present the item with Jacob and she turned it over to them. Tom Hritz stated they are proposing an increase of about 2.2% for the average users, the average use is based on consumption of 20 units per quarter which is about 15,000 gallons. And the increase for the average user would be about $3.80 per quarter or $15.20 annually. For the average user that works out to be less than $2.00 a day for purchasing water in the City of Livonia. Overall the increase in water and sewer rates for the past two years for all users has been at least or less than 3% combined increase. In the rates we have what we call fixed costs that are costs that are incurred by GLWA and Wayne County Rouge Valley. Those fixed costs before we sell any water are about 24.1 million dollars. So, when we were doing our calculations and had those figures in place along with our anticipated water sales for the year and then we come up with our rates that we propose for the year. And including in the rates as well, the City of Livonia has for the small user types with 5/8 to 1-inch meters, we're asking the amount of$69.75 per quarter and that amount hasn't changed in the past five years, it's been the same. Jacob Rushlow, Superintendent of Public Service, stated that the water rates, a big part of that is water and sewer operations that we do in the Department of Public Works and the Public Service Division to keep those systems operating, and filtering clean, safe drinking water and taking sewage from homes and delivering it to the Wastewater Treatment Facilities where it gets treated and discharged back out to the rivers and lakes around us. So on that fixed costs, things that we consider annually and when we're working with the Finance Department on this are our nonfunded capital costs for equipment, tools, vehicles, things like that, as well as Capital Improvement Projects like our Drinking Water Revolving Fund loan project that we're doing down in Section 34 this year, which is about 7.5 miles of water main replacement. Other projects like sewer repair, water repairs, the drain disconnection program that we've been doing over the last couple of years, so all of those go into calculating our costs into that portion of the fixed fee. One thing I wanted mention to you that we've been really been doing a great job in the department is changing out and updating meters to our new system with the automatic reads that increase and create efficiency in how we can read or how quickly we can read the water meters. So as of this past July we are at about 7 45% of the system now that has been switched over to those automatic meter reads which is about 17,000 customers that are on that system. If you want to look at a comparison of how does Livonia rank compared to other communities around us, and we continue to be one of the lowest among the communities whose rates that we were able to obtain. Looking at the average user and the smaller user we're the second lowest among those neighboring communities and for the largest users we're the lowest of any of the surrounding communities in that regard. So it's always a good thing to know our water rates are kept as low as possible for the servicing and the water that we deliver and provide to our residents. Councilmember Toy asked when the last time was that we didn't have a rate increase and that water rate increases are a pet peeve for her and she also wants to know about the administration fee, if we're going to get rid of that because we instituted that several years ago when I was on Council and we were told that might be taken off at some point. I have many residents asking me why am I charged this administrative fee on top of what I'm paying for the water and sewer. So I'm just wondering if you guys have taken a look at that. While we have low water rates, so to speak, we also have these other kinds of costs added on. Kumpula replied they are not really costs added on, I think what you're talking about is the flat rate fee, that fee is built into the rate. That fee actually basically even before you even bill or use one unit of water we have all of these expenses to even be connected to the system. And we have to continue to maintain that system regardless of whether we use that water or not. So that's one of the reasons that is built in there. That fee also helps smooth out our rates so we do not have large fluctuations from year to year. Prior to that rate you would see fluctuations going up and down, large increases. So that flat rate helps smooth because there are many variables that go into building or establishing water rates. So as I look at the data here in front of me, the last decrease was in 2014 and you know overall one thing we want to know is the last three years our increase overall has been less 4% in the last three years, and less than 3% in the last two years. So to answer your question when that fee is going to go away, I don't have an answer to that, and it's actually benefitting more users than it is not. Councilmember Toy stated she understands that we buy our water from Detroit, and they set the rates as well and Kumpula asked if she meant GLWA and Toy replied yes. Toy asked where the water plant is. Don Rohraff, Director of Public Works, stated when Toy was referring to the admin fee, he believes she was talking about the fixed charge and Toy replied it was maybe ten years ago and Rohraff replied that it was eight to ten years ago when the rate structure was totally changed over. And part of the reason for that fixed fee going back to maybe educate some of the newer Council people and refresh memories, actually that fixed fee was part of the logic of how we were being billed from Detroit at the time. There was a 60/40 split on fixed fees compared to consumption. It is really more of a ready to serve type of fee that's there in the 8 same sense you pay for cable whether you turn it on or not and if you go back to those meetings where we referenced that, that is the reason that we put that into there. At one point I think over the first two or three years we did adjust that around and we actually lowered it down to a certain number where it currently sits for the last five years. So that was the logic behind there and if you remember back at that time there was a lot of discussion about I can't remember the term that was going around but they were starting to sue all of the cities, making sure that the way that these customers are being billed through the communities are the same way that we were being billed by DWS at the time and GLWA currently. So that's part of the reason for that fixed fee and the way that it is and the breakdown has not changed on the way that we've been getting billed for that, so that's staying the same in being consistent in what we're doing and how we're being billed. And then the other part of your question, if you remember and I believe Connie has mentioned that over the last three years, in total we've seen like a 3% increase; last year it was like a .5, like a half of percentage. So even though it is an increase, in the big picture it's pretty flat, almost zero for last year. So I just wanted to make that point and I'll let you ask your second question. Councilmember Toy thanked Rohraff for the history he provided. She then stated what she gets is a lot of residents calling her saying what the heck is going on as far as my water. Number one, they're consuming and usually watering their grass more or using more water in the summer months and it was extremely hot this year. So that's also what I wanted to bring out and I appreciate you giving that history on that. It is a little sensitive issue because for years we were paying, kept paying higher and higher rates, and rate increases all the time to pay for Kwame's jail time and other things like that, honestly. I mean if you study the issue, there was a lot of times things going on in the water rates and Governor Snyder came in and put the Authority together and has somewhat improved. She said she really appreciates the Department's work on this and thanked Rohraff for the explanation so the residents at home can understand it better. Vice President Bahr stated he recalls, if we truly broke down our water rates by what is fixed costs and what is operating costs, the cost of actually delivering the water, that fixed rate would be a lot higher than what it is. So I actually think we're doing our residents, at least those that don't like the fixed rate, I think we're actually doing them a favor having it where it's at and it certainly helps in all the ways that Connie and Don have explained and you used the cable example and he'll use what he thinks is an even more pertinent example, just because we all depend on water, it's like your Fire Department, most of us have never used it but thank goodness we pay the tax dollars and make it available. The two questions he has but can you explain why the reduced water sales this year hurt us or is this just a pass-through; can you elaborate on that a little bit? And when I say hurt us, I just mean contribute to the rate increase. Hritz replied what he does is he takes basically a three-year average if our water sales and based upon that calculation we're anticipating a decrease of about 2.5 9 percent of our water sales. But in terms of that we're also experiencing a 5.5 percent increase from our wholesaler, so in terms of making up that difference by the decrease of the water sales, I believe it was like a $550,000 reduction in our revenue because we're not selling as much. So in order to make that difference up, we're not selling as many items, you're going to need to increase the cost. Bahr asked with these new rates taking effect in October and going through next June, is that typical for us to do this for less than a twelve month period? Rushlow replied no, it's not, but this year being a little different, the Great Lakes Water Authority Board of Directors had decided due to financial constraints with the Covid pandemic and businesses shut down and everything else, that they had pushed the normal rate increase which would occur July 1, push that off until October 1. So that's why we're coming to you at this time of year which is very much not the typical normal procedure that we would go through, typically it's July 1 to June 30tH Vice President Bahr then said he'd offer approving resolution and he does appreciate the fact that Livonia continues to really lead the pack as far as keeping these increases as low as possible. When we're talking 2% or less, I mean we're really talking about less than the rate of inflation. He said he would also like to request that all of the factors that had been presented tonight, it would really great to see on paper just the list of the different components that go into the increase, the different things that contribute to an increase and the different places that we've save, you know, whether that's just in a sequential bar chart or whatever, he'd love to see that rate out on paper if you don't mind sending that over in the next couple of weeks. Councilmember McCullough asked through the Chair, if there are any future Capital Projects or anything, are we looking into any kind of a water tower to save any funds? I know a lot of time the ROI is fairly minimal and obviously you can get a better rate by filling those towers overnight; is there anything down the pipeline? Rohraff replied a few years ago we actually went through the process of doing a study on a water tower and what that would entail, the whole process, where would it be located in multiple districts within the water system. So trying to find the right districts and you're spot on when you're talking about filling it at night and getting off of peak hours and reducing the volumes that we are taking water in at that time. That study showed to be about a 15 million dollar capital investment at the time and if I recall correctly, I want to say it was a six or seven year ROI, so that return was going to take six or seven years. So we kind of sat down and had some internal meetings on that and what that meant, the impact to the water rates in the long term paybacks that would eventually bring to us. The one big question and at the time when we were looking at this, as you know I'm a co-chair and being at a lot of those meetings with GLWA and a bunch of the consultants at the time, our big question was what are we going to do, if that ROI stays where it's at that's 10 perfect, but if the rate structure and how we're billed changes, that totally blows up the ROA and now are we out 15 million dollars in doing what we're doing. So at the time there was enough discussion going on in regard to how and potentially rates may change and how they were talking tweaking and changing some of that. As you know it's no big secret, GLWA is looking at mothballing one of the plants, so that in itself is a numerous discussion point of changing distance and elevation and some of the things that go into the rate charges. We did look at that, we still have that study, there's been talk again of looking at that type of stuff again so I think there will be more coming in that area that we probably will be talking more about that. And again, as long as the rate structure stays the way that it is, then you get through that point of that ROI then I think everything is fine, it's just making that commitment to jump into that and do that. Hopefully, that answers your question. McCullough replied it did and thanked Rohraff and stated that is something that obviously an ROI of five or six years, that's quick, and that would be a good thing to take another look at. Councilmember Donovic stated he understands the sensitive issue even though it's a small percentage but when you take into consideration electrical companies, and gas companies increase their rates 2 or 3% a year each year and most of your bills increase each year so that 2% here becomes 20 or 30% a year collectively, but at the same time we do have costs that we as a City are incurring and we have to take that into account as well so it's a sensitive topic in general. But he does have a question in terms of the lost revenue of the sum of $550,000, is that normal, can we explain why we're experiencing such a loss in revenue? Rushlow replied that one thing that they've seen and it's really not even just in our area, in the region, and even in the state, it's a nationwide trend. We're seeing a decrease in water usage and I think it's a couple of factors. It's increased efficiency of fixtures, and it's change of habit. People are becoming more conscious and aware of water conservation across the board and it's really driven, and not just on residential but on commercial and especially industrial side as well, on how they're using processed water which are some of our biggest users obviously are industrial users and becoming more efficient in what they do to lower their own costs which we can't fault them for doing, but in doing so we're seeing a trend across the region and the country about this decreased use of water on an annual basis every year after year since about 2011, 2010, there's just been a decrease. Rohraff stated he wanted to add for this year with the pandemic that was coming, he was actually one of the people who actually thought man, we're really going to knock our sales out of the park this year, everybody is going to be home, they're going to be using more water. What is the first thing they're telling people to do is wash their hands more. I was grossly mistaken with that optimism because in the same sense that everyone was home, it was also some of our largest water users were backing down production, not using water which obviously is a bigger driving 11 force than our water consumption then everybody being home and washing their hands and/or watering the lawn. As it started to level itself back out, that's how we actually ended up you know with that over half a million dollars loss of revenue from where we are. And every year, as Tom explained, it's a three-year average that we found that works the best of seeing where we're at on the graph, if we're going down which we've been going down for the last ten years and just trying to stay caught up with that. So when you're projecting your revenue and you're trying to do that, that's the problem you run into. But I just wanted to throw that out there to answer part of your question for this year, part of our problem. President McIntyre stated she's been through this a lot and every time she takes herself through it she learns, so if anybody wanted to put this into committee and it would essentially be an education session but because it's something we vote on every year, we can't do anything formal, we can't do it as a formal education session. Vice President Bahr stated he'd be happy to put it into committee, Council did it a couple years ago and it was really helpful and we've got new members and he wouldn't mind a refresher either. DIRECTION: 1)APPROVING REGULAR 2) REFER TO CAPITAL OUTLAY & INFRASTRUCTURE 9. VACATING REQUEST: Engineering Division, re: to vacate a public utility easement located within the Holiday Inn, located at 17117 and 17123 North Laurel Park Drive. Parcel I.D. Nos. 46 028-99-0006-008 & 046 028-99-0006-007. Todd Zilincik, City Engineer, presented this request to Council. He stated this is a housekeeping issue. As you know, the Holiday Inn was built a couple years ago on Newburgh just north of Six Mile and we're just trying to do clean-up on the 20- foot easement that was recorded back in 1988. They are looking to develop the south portion of that development in the near future but Group 10 had asked for a vacation, giving this to City Council for their review and go to the Planning Commission, let it circumvent its course and come back hopefully with no issues. Vice President Bahr offered an approving resolution for the Consent Agenda. Zilincik clarified that it will be sent to the Planning Commission for their review and run its course. DIRECTION: REFER TO PLANNING COMMISSION CONSENT 10. REQUEST FOR ONE-YEAR EXTENSION OF WAIVER USE APPROVAL: Planning Commission, re: Petition 2019-04-02-05, submitted by Piano Shoe Properties L.L.C., which previously received approval by the City Council on July 8, 2019, to utilize a Micro Brewer license, including redeveloping the site, 12 expanding the parking lot and modifying the exterior facade of the existing building in connection with the operation of a brew pub located on the south side of Seven Mile Road between Inkster Road and Harrison Avenue (27717 and 27719 Seven Mile Road), in the Northeast '/4 of Section 12. (CR 243-19) Mark Taormina, Director of Planning and Economic Development, presented this request to Council. He stated this item is fairly straightforward. If you recall, Council approved a little over a year ago a microbrewery operation and restaurant located at the Southeast corner of Deering and Seven Mile Roads. For reasons that are explained in the letter provided to you, the Petitioner is requesting a one year extension. And I'll note that the only modification is a name change. The entity that will be securing the liquor license is Coppersmith Brewing and the Petitioner has requested that we reflect that in the approving resolution which the Planning Commission has done as part of its recommendations to Council. Councilmember Toy offered an approving resolution for the Consent Agenda. Vice President Bahr noted that the Petitioner was in attendance at the Zoom meeting and thanked them for their patience. Andrew Schumacher, PianoShoe Properties, stated that yes, they are planning on continuing rather soon. Just a single point of order in the resolution I received from the Planning Commission in Section 1, it just also states Coppersmith Brewery, LLC, and want to make sure that gets changed to Coppersmith Brewing, LLC, which is the official name. DIRECTION: APPROVING CONSENT 11. REQUEST FOR ONE-YEAR EXTENSION OF WAIVER USE APPROVAL: Planning Commission, re: Petition 2019-05-02-08, submitted by Livonia Healthcare Real Estate, which previously received approval by the City Council on August 26, 2019, to demolish the existing nursing home (St. Jude), and construct a new building in its place for the purpose of operating a nursing and physical rehabilitation facility (Mission Point Livonia), on the north side of Ann Arbor Trail, between Joy Road and Stark Road (34350 Ann Arbor Trail), in the Southeast 1/4 of Section 33. (CR 294-19) Mark Taormina, Director of Planning and Economic Development, presented this request to Council. He stated this is a request for a one year extension as well, in this case it involves the former St. Jude Nursing Facility located on Ann Arbor Trail between Joy and Stark Roads. Again, if you recall we spent quite a lot of time reviewing not only the development of this property but there was a time they were going to relocate the facility to other sites nearby but in the end the redevelopment of this property, it was approved, nothing has occurred on the site other than the residents have been moved to new facilities. There are still unpaid property taxes associated with the site as well as unpaid water and sewer charges. The Planning 13 Commission reviewed this and is recommending approval with the conditions that were added by Council in their resolution#294-19 which requires that all taxes due and payable regarding the subject real personal property, be paid in full prior to the issuance of any building or demolition permit in connection with the waiver use approval and that would also include the unpaid water and sewer charges. President McIntyre stated she has New Data on this item dated September 3, 2020, indicating that the property taxes were paid on August 21, 2020, the real property taxes for July 1, 2020, those were the real taxes for summer and then for 2019 they were not paid to the City and were turned over to Wayne County. And then there's a letter to Scott Miller and our Planning Commission, also referencing the bankruptcy process for St. Jude and just underscoring that the taxes for 2019 are still not paid as well as the many years that are part of several bankruptcy filings. So the total amount due for real property taxes is $403,598.39. Councilmember Toy asked if the Petitioner was in attendance at the Zoom meeting. Bradley Mali, St. Jude Nursing Center, indicated just as a matter of background, this is all related to the Covid-19 pandemic. We have obtained as you know from the Planning Commission and Council's approval for the redevelopment of the site. We also obtained the certificate it needs from the Department of Health and Human Services and the licensing approval from the Michigan Department of Licensing and Regulatory Affairs. Along with that I should say the prior owner of the property went through the bankruptcy process, which was approved by the bankruptcy court, unfortunately in the midst of this development when the pandemic hit from a skilled nursing perspective, we completely stopped development. So as of March there really has been no progress on this and that was really just a function of being able to move forward with the development both from a third party engaging the process of construction and of course everything that we were doing from an operational perspective of what was going on in the facility. As of June of this year, so over the last 60, 70 days, we've been fully engaged in this project again. The engineer, the construction team, have been fully engaged, the lenders are back engaged so we would like to move forward with the project. We have in the period when we've been re-engaging with the City of Livonia, have also reached out and got extensions from the State of Michigan on the Certificate of Need and from Licensing and Regulatory Affairs on the building program. With respect to the taxes, that is correct, that there are delinquent taxes due and that amount sounds right, I don't have the exact figures in front of me but as a condition of the development not only was the City of Livonia but also as part of buying this property and the license out of the bankruptcy has required payment in full of the $400,000.00 in taxes as well as some other payments to other creditors of the bankrupt estate, so that condition is the same condition and it hasn't changed and we have no deviation from the plan. As we go through this development when they come in to do the construction, that mortgage loan will also be funding the payment of these taxes and as I just said other 14 creditors that are interested in the bankruptcy estate. So I think that condition is the same, really there's no change to the project, there's no change for the property, there's no change to the payment to the creditors, it really is just a timing issue right now and being able to do, to have sufficient time to get this project going again. President McIntyre indicated that City Treasurer, Lynda Scheel, is on the line. Lynda Scheel, Treasurer, stated she wanted to bring up the fact that the last time this was approved was in August of 2019, and I believe at that time that the developers had stated that 2019 property taxes would be paid on time and they could be paid to the City of Livonia up until the end of February of 2020 and that was prior to the pandemic, so she has a huge concern regarding the taxes on this development. Mali replied that he just doesn't know if those figures are there, but there is a requirement under the plan to pay those, certainly we will, he just didn't know that there was anything out there from August 2019. 1 know that the taxes that came due, I believe the summer taxes for this year were paid, and I think that the water and sewer bills are paid. President McIntyre said the current taxes are paid but many back taxes are not paid and I think you just heard me read the figures, I think it's a total of over $453,000.00 1 believe. Vice President Bahr stated that the City Attorney and Treasurer would recommend to Council to approve conditions upon all steps being followed as stipulated and that all 2019 and any future taxes are paid timely to the City of Livonia Treasurer prior to them being turned over to the Wayne County Treasurer, which he offered as an approving resolution for the Consent Agenda. Councilmember Donovic asked the Petitioner when they expect to be paying the back property taxes on this development. Mali replied that right now they are targeting a closing date of November 15th for the construction loan and the acquisition of the property. So we the Petitioner, Livonia Health Care Real Estate, will be buying the real estate property at the same time as closing on the construction loan. We have already acquired the licenses and the rights for the skilled nursing beds and that would be our best case scenario is November 15th Donovic asked if they do not get this funding does that mean that the past due property taxes will still be not paid and Mali replied yes, if we were not able to syndicate the deal and to get the lender to come in, which again we don't think will happen, everybody is engaged, the lender is fully engaged, the investors, 15 everybody on this project, but that would be the case, we would not be closing on the property if we were not able to close on the loan. Donovic stated he doesn't understand why property taxes are not being paid on projects but thanked the Petitioner for his answers. Mali replied that they were not the owners of this property. They did take over the property for the purposes of closing it down and then acquiring the licenses, but a lot of the past due property taxes, in fact almost all of them predate their involvement with this particular project. He stated he is not the owner of St. Jude Nursing Home. Councilmember Toy said we went through a whole lot on this subject matter, she believes it was last year, the ups and downs and everything else, and she realizes and empathizes with you, selling the building, tearing it down, whatever they're going to do, but the City has got obligations with our dollars, too, and as Mr. Donovic pointed out, we've got to start collecting otherwise this shouldn't even be on the agenda, quite frankly, we should wait until November. It's just not good business after a while. She stated she's got to pay her taxes and sometimes she doesn't like to do it, and in her business as well, but for the benefit of our community and our Treasurer is correct, she's gone round and round on this and at least make some good effort to write a check for some of them. DIRECTION: APPROVING CONSENT 12. VACATING PETITION: Planning Commission, re: Petition 2020-07-03-03, submitted by Stonefield Engineering & Design, on behalf of Haggerty Square, L.L.C. and Haggerty Residential, L.L.C., to determine whether or not to vacate a section of the existing public utility easement located on the east side of Haggerty Road, between Seven Mile and Eight Mile Roads (19700 and 19750 Haggerty Road), in the Southwest '/4 of Section 6. Mark Taormina, Director of Planning and Economic Development, presented this request to Council. He stated this is an item Council has reviewed previously and it's more or less a technical oversight, had we discovered this sooner we would have taken care of it at the time. This project was approved, Haggerty Center, there's an easement that runs along the north side of the property that's affecting the ability to complete the project, really just the garages in connection with the residential portion of the development. There's a 40 by 23 foot easement that's being reduced down to 20 feet; 20 feet is sufficient to allow DTE to maintain their wires, the rest of it is not needed for any public utility purposes but is necessary for the construction of the garages. The Planning Commission is recommending approval on this. Councilmember White offered an approving resolution for the Consent Agenda. 16 DIRECTION: APPROVING CONSENT 13. SITE PLAN PETITION: Planning Commission, re: Petition 2020-07-08-05, submitted by Belaggio Homes, Inc., requesting approval to develop a site condominium (Livonia Manor 3), consisting of four (4) single-family homes, on the north side of Seven Mile Road between Merriman Road and Osmus Avenue (31670 Seven Mile Road), in the Southeast '/4 of Section 3. Mark Taormina, Director of Planning and Economic Development, presented this request to Council. He stated he hopes everyone can see the graphic; he thinks Council is familiar with this site because it is a property that is in the process of being rezoned from R-U-F to R-1. Council in fact gave First Reading to the rezoning on July 20th with a Second Reading and Roll Call on hold pending the review of the site plan. The site plan is really what you reviewed conceptually at the time of the rezoning application when it was submitted. You can see it involves the continuation of Bridge Street and the development of four site condominium units, two on the north side, two on the south side. All four units would meet the minimum R-1 requirement. So the plan, this is just providing a little more detail for the same plan you reviewed a few months back. In addition, the Petitioner has submitted the Master Deed and Bylaws, all of which are consistent with the adjacent development and that would include not only the house sizes but also the minimum percentage of brick and other design standards. For those reasons the Planning Commission is recommending approval of the site plan as submitted. And if you scroll down in your packets, I'll show you examples of the homes that they would propose to build on those four lots. Councilmember Donovic said at the earlier Council meeting when this was first discussed, the First Reading, he thought this was a good idea, he thinks the intended purpose when building this neighborhood years back and he thinks it's a great idea. David Mobus, 19142 Shrewsbury, stated he lives where residents back up to the proposed new homes. He said they've gone over this at numerous Council meetings and with the Zoning Board and the Planning Commission, they submitted petitions. None of the residents want this. It's going to destroy the area; the houses are not needed. I understand it was discussed fifteen years ago to continue the street through, but nobody even owned that property fifteen years ago so he finds it hard to believe that it could have been planned for that long ago. It's just beyond his thinking that the City Council can approve everything when nobody in this neighborhood wants and we have submitted petitions to that effect and nobody is taking that into account. He understands Council gets thousands of reviews with residents complaining about things but when all the residents are complaining, there's something wrong. And I think you really need to listen to the residents this time. 17 Lisa M. stated in addition to what Mr. Mobus said, she knows they said that they submitted the bylaws, in the previous meetings the Petitioner has mentioned a chain link fence. That is against the bylaws of both subdivisions, Livonia Manor I and 11 and it's been mentioned that the chain link fence that's there would be either replaced or added to. She doesn't know if they have access for her to see those and/or asked if Council would review that and see if that chain link is allowed because that's not allowed in their bylaws. Vice President Bahr stated he thinks that's a fair question and he doesn't know if the Petitioner or Mark wants to speak to that. He has a hard time believing that they would put the chain link on the new property, is there a plan to put a fence there? Taormina replied the Petitioner is available so why don't we let him address that question or that comment. He will point out that while the chain link fence may not be something allowed under the building and use restrictions, it is not prohibited by ordinance, so if Mr. Soave could address those concerns. Ricoh Soave, Belaggio Homes, stated the chain link fence question came up when he believes some of the adjacent residents were saying that the existing fence there was old and some of it was falling down, so he offered if the residents wanted to replace it, the old chain link fence but a new black chain link fence. We don't allow chain link fences in our subdivisions but we're not going to put up a privacy fence because we've got houses to build on both sides and that can be up to the future homeowners. So that was what I offered, not what we're permitting, if that makes sense. It was just a gratis offer for the neighbors that were complaining that the fence was unsightly, rusted, and falling apart in some places and they asked if we were going to replace the fence. Vice President Bahr clarified that it was the existing fence that the Petitioner offered to replace, and that would go away with this new construction and Soave replied that's correct. Michael Hendrick stated the residents in the neighborhood are not in favor of this and commented that Council really does need to look at that and address it, he knows the parties want to move forward but he wishes Council would look at the homes that it's impacting and what their thoughts are. Vice President Bahr offered an approving resolution and President McIntyre requested it be put on the Regular Agenda. Taormina indicated that the vote on the rezoning will have to occur prior to that. DIRECTION: APPROVING REGULAR 18 AUDIENCE COMMUNICATION During Audience Communication Lisa M. spoke stating she appreciates the clarification on the fence but that was not how it was stated previously to them, it was led to believe that they would be replacing the fence and adding fence in the back for between the previous home and the existing lot of chain link fence, so that does need clarification as to what's being allowed and if it's left to the future homeowners, that fence that's up there I guess for clarification, is that being removed, the existing chain link fencing and then who would be responsible for paying for that removal because there can't be two fences back to back. Vice President Bahr stated it is his understanding that it will be removed at the developer's expense when they construct these new homes. President McIntyre thanked everyone for their comments and that they were heard. As there were no further questions or comments, President McIntyre adjourned the Study Session at 10:50 p.m. on Wednesday, September 9, 2020. For the 1,905t" Regular Meeting of September 21, 2020 DATED: September 15, 2020 SUSAN M. NASH, CITY CLERK