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	The Ypsilanti Courier A Heritage Newspaper Weekly Publication

Apartment complex asks city for $490,000

Company: City OK'd total cost for 2004 brownfield plan

By Dan DuChene, Staff Writer

PUBLISHED: January 25, 2007

An owner of local apartment complex, Peninsular Place, is asking city officials to reimburse the company $490,000 in brownfield redevelopment costs reportedly approved in 2004.

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Rick Kirk, of Edwards Communities, a Columbus-based apartment provider, addressed the City Council last week.

"All I want is to get the money that was approved," Kirk said to the council. "It seems to me this is a fairly reasonable and fair request."

In April 2004, the Planning and Development Department requested the city approve a change to an original brownfield plan, known as the Peninsular Park Planned Unit Development Brownfield Plan.

The city had originally approved a plan to allow tax increment financing capture of $1.99 million. The money would be captured from the company's taxes and refunded to repay the cost of redeveloping the paper mill that was located on the property. Then in April, the Planning and Development Department worked out a deal with Edwards Communities, where they would ask the state for nearly $500,000 in tax credit from the Single Business Tax. The total in tax increment financing capture was then lowered to nearly $1.5 million. The company never received any SBT funding.

After the meeting, Kirk said he didn't know why the company didn't receive any SBT funding. He said he didn't know if his company had submitted an application to the state.

"I don't have an answer," Kirk said. "I honestly don't know the exact reason."

"There isn't any SBT money, it wasn't granted," Kirk said. "I'm just asking for the approved amount."

In the Planning and Development Department's request, one of the recommendations to council reads: "This recommendation was made with the caveat that should the state require a higher local TIF commitment, that the Brownfield Redevelopment Authority would support this amendment and would support the whole amount of $1,990,000 in order (for) the project could move forward."

Lois Richardson, D-Ward 1, said the city should not break promises, especially with the Water Street Project on hold.

"If we made a commitment, then we need to stand by the commitment that we made," Richardson said.

John Gawlas, D- Ward 2, asked Kirk if he had reviewed the SBT, before beginning the process.

"I was overwhelmed with the complexity of getting the project done," Kirk said.

He said the company had to move quickly at the time to be open for student move-in in the fall of 2005.

"If we would have missed (student move-in), it would have been vacant," Kirk said.

The 184-unit apartment complex was built in the fall of 2005. Kirk said it has a high occupancy, most of which are students.

"Whose responsibility is the due diligence?" Gawlas asked. "I'm taking responsibility for this."

After Kirk had made his presentation, Brian Robb, D-3rd Ward, brought up the issue again.

"He seemed to say it was us who owed him," Robb said. "I don't want to say it's insulting, but it's insulting."

After the meeting, Robb said he has not seen evidence, either from Edwards Communities or the state, which shows the company had applied for the SBT credit. He said council had set a cap in TIF capture in 2004, when the brownfield plan was approved.

"Based on the resolution, I don't believe we owe them anything," Robb said.

After Robb brought up the issue before council again, Bill Nickels, D-2nd Ward, said, "In effect, they're asking us to cover up their screw-up."

City Manager Ed Koryzno said city staff is working to put a resolution before council at its next meeting. He said the council will have to decide if the city should have to bear the total cost of the brownfield redevelopment.

Last year, according to Marilou Uy, the city's finance director, the city collected about $700,000 in taxes from Peninsular Place. She said $573,000 of that will go back to the company. As it stands, the TIF capture on the property will expire in 2010, with Edwards Communities capturing about $1.5 million to reimburse brownfield costs. The proposed plan would extend the TIF capture until 2011, reimbursing the company $1.99 million.