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THE BIRMINGHAM BUZZ
"The cardinal sin, when we are looking for truth of fact
or wisdom of policy, is refusal to discuss, or action
which blocks discussion." -- Sidney Hook
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Buzz # 25 -- July 22, 2002

Promoting intelligence and reason in city government. Our mission: To inform and involve all Birmingham citizens.

VISIT OUR WEBSITE at http://www.bhambuzz.org for:
-- Up-to-date news items
-- Resources such as the 2016 Plan and the proposed Ethics ordinance.
-- A calendar of important city events
-- A lively and intelligent discussion group

We want to hear from you! Please send questions, suggestions and feedback to info@bhambuzz.org
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In this edition:

1) Meetings offer chance to be informed, involved
2) Jacobson's will leave a void downtown
3) John Richards bankruptcy suit is booted
4) Next phase in Royal Oak's evolution: growing upward
5) With no bids for chain, Jake's to sell piecemeal
6) Buyers poised as plan for Jacobson due today
7) Dispute leads to involuntary bankruptcy filing against developer
8) Single-family units downtown to be reviewed
9) Full Commission agendas now available free online
10) Presidents' Council bylaws posted
11) Editorial: Novi settlement is lesson for all cities


1) Meetings offer chance to be informed, involved

July 22, 2002

Proposed plans for the restoration of Quarton Lake park will be presented at Tuesday night's Quarton Lake Improvement Committee meeting. Residents are invited to see the presentation and comment. The meeting is 6:30-9:30 p.m., Tuesday, July 23 at the Department of Public Services, 851 S. Eton.

On Wednesday, historic preservation will be the topic of a Neighborhood Roundtable Committee meeting at 6:30 p.m. at the Dept. of Public Services. State Historian Jennifer Radcliff, builder Rick Wiand, architectural historian Dale Dyure and city planner Jim Sabo are slated to speak.

2) Jacobson's will leave a void downtown

July 21, 2002

From the Birmingham Eccentric

By Larry Ruehlen

With Jacobson's on the brink of liquidation, it's becoming clear that Birmingham merchants may have to survive as much as two years without a department store anchoring the retail sector.

"I don't think a department store would come in and be happy with new paint and shelves," said Birmingham architect Victor Saroki. "At the minimum, they will want a new facade and mechanicals... a renovation could take a year or two."

Jacobson's creditors have received separate bids for the merchandise and receivables. Only a last-ditch bid before Wednesday, July 24, would save the company from liquidation and experts say that is unlikely given the poor economy.

If no such bid comes in, individual pieces of real estate including the two Birmingham stores will be sold. Northbrook, Ill.- based Hilco Real Estate is already taking bids on individual stores and has a set a Sept. 6 deadline. Interested parties will have a chance to top the highest bid at a Sept. 17 auction. Shortly thereafter, the identity of the winning bidder should be revealed.

"I've had some inquiries about the zoning and how it would be to work with the city," said Tom Markus, Birmingham City Manager. "And the prevailing attitude is that we would love to see an anchor department store selling soft goods in the city."

Saroki said extensive renovations might be able to save one or both of the Birmingham stores but they may also have to be torn down.

"I would like to see a department store but there aren't many to choose from," he said. "Most of them are already at Somerset."

Somerset Collection is a glitzy mall in Troy that's packed with high-end retailers.

Jacobson's owns two buildings in Birmingham. The first is the woman's store, which has 98,825 square-feet on 1.18 acres at Maple and Chester Street, and the second is men's/children's store, which has 80,000 square feet on 1-acre of land at Woodward Avenue and Willits Road.

Jim Weiner, president of Related Retail Corp., tried to acquire some of Jacobson's property in 1999 and is still interested.

"I've put in a bid, and I know exactly what I want to do with the property," said Weiner.

Weiner, developer of the Palladium/Willits project, said he couldn't comment further because the bidding process is open. He once tried to acquire and demolish the children's store, then build Jacobson's a new building on Willits and North Old Woodward.

Ted Fuller, owner of Central Park Properties, said he is interested in the parcels as well but concerned about the approval process for construction projects in the city.

"There have been 25 retail vacancies in this town for years, and I don't think the (Birmingham) City Commission cares about what happens in the business district. The approval process could take years and that has a huge effect on the cost of developing those properties."

One idea people are talking about is a multistory retail building like those found in Chicago, where retailers like The GAP house different stores under the same roof. Another possibility is multiuse development with retail on the first floor and residential or office above.

Jacobson's recently defaulted on a line of credit of up to $100 million that was supposed to help it get out of Chapter 11 bankruptcy. The chain's creditors called in the loans and Jacobson's has already let many of its employees go at its Jackson headquarters and Orlando distribution center. Retail employees will be let go as stores close down.
If a bid for the whole company doesn't come in by Wednesday, a final merchandise sale could begin as early as next week. Such sales usually take eight weeks or more.

Jacobson's operates 18 stores in Michigan, Indiana, Kentucky, Kansas and Florida and has been in Birmingham since 1950.


3) John Richards bankruptcy suit is booted

July 21, 2002

From the Birmingham Eccentric

By Larry Ruehlen

Staff Writer

In the wake of a decision that spared his company from possible liquidation, John Shekerjian is now looking to rebuild his reputation.

"This has been devastating because this whole business is based on reputation," said Shekerjian. "But we owe a great debt of gratitude to our employees and the trades, (the people) who stuck by us."

Bankruptcy Judge Steven W. Rhodes ruled last week that an involuntary Chapter 7 bankruptcy petition against Shekerjian's company, John Richards Homes, was invalid. The petition was filed by Franklin resident Kevin Adell over a disputed $3 million home deal in Bloomfield Hills. Adell also has a civil lawsuit pending against the company.

Sam Riddle, Adell's media consultant, said his client was disappointed in the ruling and may appeal it. He also said Adell will continue the lawsuit.

"Mr. Adell is heartbroken," said Riddle.

Rhodes ruled that Adell did not have legal standing to file the petition because the debt involved was disputed. Under involuntary Chapter 7 law, the debt must be an undisputed fact. In this case, Shekerjian contended that he didn't owe Adell anything, and in fact had been injured by Adell's decision to renege on the land deal.

Adell purchased a 1.8-acre lot at 525 Haverhill from Shekerjian in December 2001. The deal was for just over $3 million including the land and the construction of a luxury house. Adell claimed the house was supposed to be worth $2 million and the property $1 million. Shekerjian claimed the property was worth $1.75 million and Adell signed closing papers on Feb. 28 that stated the land price as $1.75 million.

When a bankruptcy notice appeared in a business publication, customers and business associates began calling Shekerjian to see if he was going to close up shop after 20 years in business. He told them he wasn't going broke and said he thought the bankruptcy claim would be tossed out. He also said Adell was systematically trying to destroy his reputation.

Rhodes scheduled a Sept. 25 hearing on whether John Richards Homes can collect costs, attorney fees and punitive damages from Adell.

Shekerjian also said his company can now focus on building things including a condominium project at 250 Martin, in downtown Birmingham, the outside of which should be enclosed by the end of the year.


4) New buds in Royal Oak -- Next phase in city's evolution: growing upward

July 15, 2002

From Crain's Detroit Business

Southeast Michigan had better plug its ears: Developers and city officials in Royal Oak expect the city's boom to become deafening as it stands on the verge of a third renaissance.

That's despite the fact that the sluggish economy has slowed the city's evolution in the past few years, enough to make signs advertising new projects and boarded-up windows as much a part of the landscape as the 20- and 30-somethings that cram the city's sidewalks and bars.

But things may be turning around.

Pointing to the new downtown Barnes & Noble, acceptance into the Oakland County Main Street program, movement on a number of proposed residential properties and the possibility of establishing a business-improvement district, Royal Oak officials and developers are convinced that the city's landscape once again is on the verge of change.

This time though, the evolution will be centered on taller buildings, more retail and higher density.

"We had said all along that what's going to make people believers are shovels in the ground," said Gerard Dettloff, Royal Oak's downtown manager. "When they broke ground on some of these new projects, it renewed credibility, especially when you consider we're in slower economic times."

Dettloff said he has noticed apprehension lifting from investors and developers who have in the past taken a wait-and-see approach to Royal Oak.

The reasons?

An improving economy, revised plans that are less risky for investors and strong interest in living in downtown Royal Oak.

The Main Place development is a good example.

Anchored by the Barnes & Noble bookstore, the development also will include an American Home Fitness equipment retailer, Atlanta Bread baked goods shop and Nik's Blowfish, a Japanese steakhouse and sushi restaurant.

Nik's Blowfish has a liquor license, said David Strosberg, president of Chicago-based Morningside Group.

Morningside and Chicago's HSA Commercial are partners in the Main Place development. The companies are also partners in SkyLofts, a 70-loft and retail development planned on Main Street between Fourth and Fifth streets. SkyLofts is just north of Main Place.

Strosberg said SkyLofts would have about 20,000 square feet of retail space. SkyLofts will offer lofts for sale for $220,000 to $650,000 catering to different types of buyers.

"Our buyers to date have included everything from recent college graduates to people in their 50s whose children have left their home and are looking to simplify their life," he said. So far, SkyLofts has sold more than 25 percent of its units from a nearby sales office. The lofts are scheduled to be ready in fall of 2003 when the eight-story building is complete, Strosberg said.

Strosberg said he decided the time was ripe to offer a more urban living and retail environment in Royal Oak, similar to Chicago.

"Royal Oak went from a sleepy, blue-collar town to an entertainment mecca," he said. "It was obvious it had potential in addition to that for becoming a retail hub ... and the housing component is extremely important."

Another example?

A 12-story, $22 million condo/retail project on Washington Avenue called The Fifth.

A project planned by Royal Oak-based Chrysos Development L.L.C., it originally was a hotel/condo project called the Royal Grand.

But Jack Hanna, president of Chrysos, said he couldn't get the financing for the project because investors and banks were leery of plopping a hotel in downtown Royal Oak.

"When we started marketing the project, there was a tremendous amount of interest in the condos, especially from mobile people who have other homes in Florida or out west," Hanna said. "But when we started talking hotel, the sources of financing became very negative."

So the project was scrapped in favor of the new one, which includes 40 condos ranging from 1,000 square feet to 2,500 square feet, an 80-car parking garage and 4,500 square feet of retail on the first floor.

Hanna said he expects construction to begin by the end of this year and the project to be completed by the second quarter of 2004.

Work has begun on other sites.

The former Erb Lumber site at Lincoln and Main streets has site-plan approval for a mixed-use project of as much as 66,000 square feet.

Reynold Hendrickson, vice president of Edgemere Enterprises, said Edgemere is preparing the site for development but seeking a buyer to take over and actually develop the site. Bloomfield Hills-based Edgemere has hired Southfield-based Signature Associates-Oncor International to find prospective buyers. Hendrickson said he wants to open the bids he receives on the property in August.

"As soon as someone buys this, they can come right out of the ground," Hendrickson said. The mixed-use site-plan approval allows for combinations of residential, office and retail. Hendrickson is completing underground utility work and paving the parking lot.

The most notable long-term project is the seven-story office building and seven-story hotel at Main Street and I-696 that Schostak Bros. & Co. Inc. is planning. Schostak took over as developer of the long-delayed project last year.

Cindy Ciura, vice president of corporate marketing for Schostak, said the company is negotiating with a hotel operator but doesn't have a signed deal yet. She also said Schostak has a number of office prospects it is talking with.

Tim Twing, director of planning in Royal Oak, said Schostak won site-plan approval in April for the 180,000-square-foot office portion of the development, under the name Woodward Gateway L.L.C. A plan for the hotel has not been submitted, he said.

Despite the fact that several projects like these are moving forward, many are still years away from completion.

So, instead of waiting for the city's development, Dettloff said, the city was interested in becoming part of the Main Street Oakland County project.

Participating cities go through evaluations of downtown organization, design, promotion and marketing and business development and receive recommendations.

Main Street Oakland County is a program run by Oakland County's Planning and Economic Development Department in collaboration with the Washington-based National Main Street Center, part of the National Trust for Historic Preservation. Cities are part of the program for three years. Other cities in the program now include Walled Lake, Rochester, Ferndale and Pontiac.

Royal Oak was selected to participate in the project June 19.

"Someone asked me why Royal Oak would want to be in the program, look at all the stuff that's happened down here ... and it is a great downtown," Dettloff said. "But you can't just rest on that, you're always looking for ways to improve, and we thought this is a very successful program when used successfully, so why wouldn't we make that attempt to get on board with it?"

At least one broker has his own idea of what Royal Oak needs: more office space and business-friendly parking policies.

Bob Sheldon, president of Berridge & Morrison, a commercial brokerage based in Royal Oak, said he believes the last element that would help to further balance out the city's downtown is more office space.

While visiting shoppers and downtown residents help support retailers, more office workers downtown during the day would help retail even more, he said. Berridge & Morrison recently leased a renovated 12,000-square-foot office building at 206 W. Sixth near Washington.

Additional office space could include more renovations like this one or adding floors to buildings. New significant office construction is also possible on some sites, such as the Schostak site, Sheldon said.

To date, shoppers have supported retailers such as home furnishings stores and art galleries in addition to the food-focused shops and restaurants. The Barnes & Noble will be a major boost to more downtown browsing, Sheldon said, but more people living and working in Royal Oak would support even more variety.

"With the residential and the office, there would be a bigger demand for male and female specialty clothing stores," he said.


5) With no bids for chain, Jake's to sell piecemeal

July 16, 2002

From Crain's Detroit Business

The chance for companies to buy Jackson-based Jacobson Stores Inc. has come and gone, and the retailer is selling off stores individually.

“Yesterday there was a deadline for inventory and receivables and a global package bid. As of midafternoon yesterday, there was no bid submitted” for the whole company, said Josh Joseph, vice president of Northbrook, Ill.-based Hilco Real Estate L.L.C.

Hilco is in charge of overseeing the bidding for Jacobson’s individual stores and its headquarters and began accepting bids in June. Jacobson already has received approval from U.S. Bankruptcy Court in Detroit to conduct an auction for its stores.

Jacobson, which filed for Chapter 11 bankruptcy protection Jan. 15, has been searching for a buyer for at least seven months. Although the retailer was unable to find a buyer for the entire company, its real estate and inventory is in demand, Joseph said.

Jacobson’s started the year with 23 stores. Eighteen remain open, six in metro Detroit. The company has two stores in Birmingham and one each in Grosse Pointe, Rochester Hills, Ann Arbor and Livonia.

Jacobson owns 11 of its store buildings, leases nine and owns the building but not the land for three.

“I have offers on all owned properties at this point, a few of the leased properties and a few of the ground-leased properties,” Joseph said.

The deadline to submit bids on Jacobson’s stores and other assets is Sept. 6, and an auction is scheduled for Sept. 17. The results are subject to court approval.

Fred Marx, a partner in the Farmington Hills public-relations firm Marx Layne & Co. and spokesman for Jacobson, declined to comment on the results of the bidding. Marx did say the company might make an announcement or file documents with the court detailing the results later this week.

Marx also confirmed that Jacobson told 240 employees at its headquarters and 20 at a distribution center in Orlando, Fla., that Friday will be their last day of work. They will receive pay until Sept. 3.

About 200 people still will work at the company’s headquarters, 20 in Orlando and about 2,700 at its stores, Marx said.

Jacobson, founded in 1868, prides itself on service and pricey designer clothes that appeal to well-off women. But the company didn’t change its marketing and merchandising strategy, and sales declined at stores open more than a year.

Eventually, Jacobson’s aging clientele, its wide range of store sizes and concepts, competition from larger national retailers and last year’s slow Christmas sales forced the retailer to file for bankruptcy.

Jacobson received a $100 million line of credit after it filed. However, in a June 27 news release, the company acknowledged that it defaulted on the agreement. Jacobson then was forced to put its assets up for sale to repay lenders.

6) Buyers poised as plan for Jacobson due today

July 15, 2002

From Crain's Detroit Business

Although it is unlikely that Jackson-based Jacobson Stores Inc. will find a buyer for the entire company, the effort to sell individual stores or to sell groups of stores is generating a lot of interest, says the company in charge of the bidding.

Jacobson operates 18 stores in Indiana, Kentucky, Kansas, Florida and Michigan, including six in metro Detroit.

Retail experts say it will be easier to find buyers for Jacobson's stores in regional shopping malls than for freestanding downtown locations, such as the two stores in Birmingham and the store in Grosse Pointe.

The other local stores are in Rochester Hills, Ann Arbor and Livonia. Five stores closed earlier this year are also up for sale.

Jacobson, which filed for Chapter 11 bankruptcy protection Jan. 15, filed a motion July 3 in U.S. Bankruptcy Court in Detroit saying the company is accepting offers on each of its 18 stores.

Jacobson would still prefer to sell the entire company rather than liquidate, but a deadline for a buyer to submit a bid for the company expires today.

Jay Indyke, a partner at New York City-based Kronish Lieb Weiner & Hellman L.L.P. and counsel to the committee of unsecured creditors, said a sale of the company is unlikely, even though interest was expressed earlier this year by several retailers.

"The fact of the matter is the company has been marketed since January," Indyke said. "They have attempted to look for a partner ... for quite some time, and from the time they filed for bankruptcy until now they have not been able to find that partner."

If a bid for the company is submitted by noon today, it would be compared with the estimated value of liquidation, and the best option will be chosen, Indyke said.

If no formal offer is made, Jacobson's stores and property will be liquidated. An auction date for the sale of the company's assets is scheduled for July 24, and the hearing to approve the auction results is set for July 25.

A liquidation is likely, said Josh Joseph, vice president of Northbrook, Ill.-based Hilco Real Estate L.L.C., the company overseeing the bidding.

"Jacobson's has been shopped around for the last few months as a going concern," Joseph said. "That has come and gone at this point."

Joseph said Hilco has received numerous offers for individual stores and said there have been numerous offers for blocks of stores.

Fred Marx, a partner at Farmington Hills-based Marx Layne & Co. and a spokesman for Jacobson's, declined to comment on the bidding process beyond Jacobson's news releases.

Jim Bieri, president of Detroit-based retail consultant Bieri Co., said few retailers would be interested in buying the entire company. Part of the problem is that many of Jacobson's stores are smaller than what most department stores need these days, but they are too big for specialty retailers. Plus, Bieri said, Jacobson's stores vary in size, location, and type, making it difficult to sell all of them to a single retailer.

But as individual stores or groups, Jacobson's real estate is far more marketable.

"Overall, I think it's good real estate," said Jim Stokas, a principal at Southfield-based Stokas Realty Advisors L.L.C.. "So I would anticipate they will have quite a few offers."

Stokas said he has been in touch with retailers that are interested in some of the sites and had plans to submit bids on them. Stokas declined to say which ones his clients are interested in.

In general, though, Stokas said he expects higher demand for the 11 stores that Jacobson's owns than for the 12 it leases.

"I have retailers that are interested in the sites. I'm just deciding how to approach it right now," Stokas said.

In metro Detroit, Jacobson's Ann Arbor store is possibly the most desirable location. The 100,055-square-foot store is an anchor site at Briarwood Mall.

David Huntoon, senior vice president of the Ann Arbor-based retail-consulting firm Thompson Associates, said the store is large enough to meet the needs of nearly any department store chain.

Plus, Briarwood is the only regional mall in Ann Arbor. Its tenants averaged more than $456 a square foot in sales last year, higher than the industry average, said Karen McDonald, director of communications for Bloomfield Hills-based Taubman Centers Inc., the company that manages the mall.

Another marketable location, Huntoon said, is Jacobson's 149,000-square-foot anchor store at Laurel Park Place in Livonia.

Cindy Ciura, vice president of marketing for Southfield-based Schostak Bros. & Co., said several retail chains have inquired about the site since Jacobson's filed for bankruptcy.

Finding a retailer to take over the 105,719-square-foot store at Great Oaks Mall in Rochester Hills could be more difficult. Jacobson's occupies the majority of the space at the mall, built in 1978.

Plus, a new 375,000-square-foot shopping center called the Village of Rochester Hills is set to open this fall. A Parisian department store will anchor the mall, and a powerful lineup of popular and luxury specialty stores also will open.

Bieri said the Great Oaks store might be more marketable as property for an office building. Owner Samuel Frankel of Troy-based Frankel Associates did not return calls for comment.

The potential departure of Jacobson's from two stores in downtown Birmingham and a large store in Grosse Pointe could leave gaping holes of retail space in both communities.

In Grosse Pointe, Jacobson's has anchored the village shopping area for nearly 60 years, said Michael Kramer, president of the Grosse Pointe Village Association. Jacobson's 119,600-square-foot store dwarfs any other retailer in the Village of Grosse Pointe, a six-block retail-shopping district.

Jacobson's, with about 45,000 square feet of space on its first floor, accounts for about 18 percent of the 250,000 square feet of first-floor retail space in the district.

Kramer said talks are under way on how to replace it.

"We are hoping someone will operate a large retail store in that space and continue to draw people in," he said. "I have heard discussion of mixed use, with office or residential on the second floor and several specialty retailers on first floor."

In Birmingham, Jacobson's operates a 98,000-square-foot women's store at 336 W. Maple Road and an 80,000-square-foot men's store at 325 N. Old Woodward Ave.

Together, the stores represent about 18 percent of downtown Birmingham's 1 million square feet of retail space, said John Heiney, executive director of the Downtown Birmingham Principal Shopping District.

Replacing the Birmingham stores would be difficult because of competition from The Somerset Collection in Troy and other nearby malls, Bieri said.


7) Dispute leads to involuntary bankruptcy filing against developer of 250 Martin St. condo
Shekerjian: Company is healthy; filing is attempt to ruin reputation

July 14, 2002

From the Birmingham Eccentric

One side claims fraud between a bank and a home builder artificially inflated the price of one of the most expensive residential lots in Bloomfield Hills. The other claims that the deal gone bad threatens the vitality of a respected company.

Earlier this month, Kevin Adell, a Franklin resident, filed a civil lawsuit and involuntary Chapter 7 bankruptcy proceedings against John Richards Homes, a Bloomfield-based luxury home builder.

John Shekerjian, president of John Richards Homes, said the home-building company is not on the verge of bankruptcy and neither are his other businesses -- one of which is building a condominium complex in downtown Birmingham at 250 Martin St.

"What he does works and it is a nightmare," said Shekerjian. "He is damaging us, but are we going to survive? Yes. And 250 Martin will get built."

Shekerjian claims Adell is systematically trying to ruin his reputation to get a better deal on the property.

Adell purchased the 1.8-acre lot at 525 Haverhill from Shekerjian in December 2001. The deal was for just over $3 million including the land and the construction of a luxury house. Adell claims the house was supposed to be worth $2 million and the property $1 million.

Adell signed closing papers on Feb. 28 that state the land price to be $1.75 million and the construction price as $1.28 million. Adell, in the lawsuit, claims he didn't have time for his attorney to read the closing papers.

Two real estate brokers confirmed that the property was listed at $1.35 million in September 2001.

Shekerjian said he offered Adell a complete refund but he refused and hired another contractor to build the house, which is currently under construction.

The whispers of bankruptcy proceedings led to a barrage of telephone calls from customers who want to know if their million-dollar homes will be built and from subcontractors who want to know if they should show up for work.

Several contractors who work with Shekerjian said a person representing himself to be Adell called them repeatedly over the last week to try to get them to join the bankruptcy proceeding against John Richards Homes. As of July 11, Adell was the only party to file involuntary bankruptcy against the company. Norman Ankers, Shekerjian's attorney, said the bankruptcy action was improper because there must be at least three creditors joining the petition under normal circumstances.

Shekerjian said his various companies do owe people money, but he is confident the bankruptcy claim will be tossed out of court in the near future.

Adell, vice president of Clinton Township-based Adell Broadcasting, alleges in his civil suit that First Federal of Michigan and John Richards Homes colluded to artificially inflate the purchase price of the land, which would have benefited the developer at Adell's expense.

Bank officials deny the charge and are trying to negotiate an end to the dispute.

Adell hired Marx Layne Marketing & Public Relations to get the word out about the bankruptcy and a bankruptcy notice. A bankruptcy notice did appear in a business publication. Adell's company also owns "The Word Network" - a Cable TV station that broadcasts religious programming featuring sermons from notable minority ministers.

John D. Koch, executive vice president of Charter One Bank, the parent company of First Federal, said he was startled when several prominent African-American ministers attended a June negotiating session between the bank, Adell and Shekerjian.

The ministers said they were there to talk about the bank's lending practices and possible racial discrimination, said Koch.

"The issues appeared to be totally unrelated," said Koch.

Koch had no comment on whether the religious leaders pressured Koch to cut Adell a better deal. The following week, more than 50 people protested in front of Charter One's Cleveland headquarters.

Adell was scheduled to discuss the matter with the Eccentric but said, through a representative of Marx Lane, that he was too busy to attend.

Shekerjian's attorney has filed a motion to dismiss the involuntary bankruptcy claim for being improperly filed. The matter is expected to go before a judge on July 15.


8) Single-family units downtown to be reviewed

July 14, 2002

From the Birmingham Eccentric

By Larry Ruehlen

Mel Kaftan may soon be looking for a new place to live.

But he said, "I think they are going to be able to work it out. Other projects have been approved, so I'll wait and see what happens."

Kaftan wants to live in a commercial building at 369 E. Maple and applied for a permit to build an apartment above the commercial space.

Although the city has approved similar projects in the past, the Birmingham Planning Board put a hold on Kaftan's site plan approval. The board cited the need to clear up ambiguities in the city's zoning ordinance. It acted on the advice of Nicholas Lomako, an urban planner and consultant for the city. In a June 19 report Lomako said a study of the ordinance revealed that "only multiple-family dwellings are allowed above commercial or office use" and that at least three units had to be included to meet the ordinance.

Kaftan said he bought the building after the city approved single-family dwellings above commercial space on two occasions, and he is willing to take his case to court if necessary.

Gary Kulak, chairman of the planning board, said the board's prior approvals were based on advice of city planners who have since left Birmingham for other jobs. He also said the ordinance is clear to him.

"What's required is multi-family," he said. "...Obviously, either someone didn't understand the ordinance or they had a different interpretation of it." The opposing interpretation was that the multi-unit rule was a maximum limit, not an absolute requirement.

Ted Fuller, a local developer who was given permission to build a single apartment on top of his building at 249 Pierce, said too much density is usually the problem in Birmingham.

"Private property owners should have the right to put in one unit if they want," said Fuller. "As long as they stay within the height restrictions, why should the city care?"

Kulak said his primary concern is enforcing city rules and making sure building projects follow the master plan.

Lomako suggested further interpretation by the city's building department and a possible rewrite of the ordinance.

A 7:30 p.m. July 17 study session has been scheduled and Kaftan goes back before the planning board on July 24.


9) Full Commission agendas now available free; essential info downloadable from city website


July 15, 2002

The City of Birmingham has taken an enormous, even historic, step toward opening government to the people by posting the expanded version of its City Commission agendas on the Internet.

Until today, the agendas were available for purchase at $5 per copy, and had to be ordered from the City Clerk's office. Subscriptions were available.

Few citizens obtained the mountains of paperwork that accompanied the basic Commission agendas, even though it contained significant background information on Commission business.

Now, the information is available free in downloadable Adobe Acrobat format. Click here to visit the city's website.

For help in downloading or viewing the large documents, feel free to email the Buzz at info@bhambuzz.org
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10) Presidents' Council bylaws posted

July 8, 2002

More than six months after requesting the bylaws of the Presidents' Council of Homeowner Associations, the Buzz has finally been provided with a copy, which it obtained through a member association.

Read them at http://www.bhambuzz.org/pdfs/bylaws.pdf{{PERIOD}}


11) Editorial: Novi settlement is lesson for all cities

July 7, 2002

From the Detroit News

The city of Novi now has a plan to pay off $72 million to a developer who won a lawsuit against the suburb. The payment compensates the developer for city actions that unfairly crimped his business.

Novi did the right thing in settling the case. It should have done so sooner. And the details should be a lesson for other city governments.

Novi will give the developer city-owned land to keep down the actual outlay of cash. The trade is controversial but warranted. Now residents in the Oakland County community won't be hit with huge tax increases or cutbacks in service.

The case stems from plans by Sandstone Associates to develop an area south of 13 Mile. The company said it would mimic small towns of 100 years ago in a style called "new urbanism."

In 1995, Sandstone filed a lawsuit saying Novi sabotaged the project by blocking access and reneging on agreements to build roads. Oakland Circuit Court Judge Barry Howard sided with Sandstone, saying the city had been downright abusive and vindictive.

This is not a "Third World country and municipal governments are not above the law," the judge said. The original judgment against Novi was about $40 million. But the city dragged its feet in paying up. So the tab is now $72 million, including interest that rose to some $20,000 a day.

The settlement is a wake-up call for city governments trying to micromanage their communities. Some Birmingham officials, for example, want homeowners to pull a city permit before trimming certain trees in their lawn. A public outcry put the plan on ice, but some hope it can be revived.

In Bloomfield Township, officials oppose Bloomfield Park, a $2 billion development proposed near Telegraph and Square Lake. As a result, the township risks losing the acreage to Pontiac, a pro-development city next door.

The conflict between development and critics is at least as old as the ancient Greeks. In Novi, some residents still oppose settling the lawsuit with land that could be used for city parks. They prefer to have the green.

But the city has acted properly. One alternative, for example, was to cover the $72 million by increasing taxes ($237 a year on a home with a taxable value of $100,000). Trading land makes more sense. By rules of thumb on such things, Novi has a surplus of park area for its population.

The Novi case provides this bottom line: Local governments have a right to control and shape development. But that authority is not absolute. The effort must be balanced against property rights, including those of homeowners and developers.