Judge Vacates Permit For Pine Street Project

Judge Philip Rodgers vacated a special land use permit granted to the proposed nine-story River West development on Pine Street and remanded the project back to the Traverse City commission for further review in a bench ruling Thursday in Thirteenth Circuit Court.

In a lawsuit appealing the SLUP on behalf of resident Priscilla Townsend and the Northern Michigan Environmental Action Council, attorney Grant Parsons argued commissioners failed to properly analyze the River West plans and did not conduct due diligence to ensure the development met all SLUP standards. Rodgers agreed with Parsons’ arguments, saying the record of commissioners’ deliberations was “bereft” of any evidence showing the city analyzed the public subsidies required by the project, the tax revenues it would generate or the impact it would have on city services like fire, police, sewer and electricity. Rodgers rebuked commissioners for accepting on face value reports from city staff that the planned two nine-story buildings would not put any additional pressure on city infrastructure, calling the notion “absurd.”

“In approving this special land use permit, the city has either been hopelessly naïve and uninformed…or less than candid with the general public,” Rodgers said. “The questions which the city commission has never answered are: Can it afford to deal with vacant lots by subsidizing the developments they’re on for decades? And is it fair to do so by financing the marginal increase in demands for services out of the pockets of every other city taxpayer?”

Rodgers ordered city commissioners to schedule a public hearing to review the development in greater detail, instructing them to complete a “cogent analysis of the project’s impact on infrastructure, facilities and services, the source of funds to pay for that impact, and an intelligent discussion of the perceived benefits that support justifying such extensive public subsidies on the backs of local taxpayers.”

The judge said if commissioners completed that analysis, objections over the project would become “political – not legal.” Rodgers also left the door open to future court review of whether developments that use local tax increment financing (TIF) funds should be subject to a public vote, as Parsons argued, but did not issue a ruling on the matter Thursday.

Parsons expressed his satisfaction with Rodgers’ opinion following the hearing, saying the judge had reiterated the underlying tenet of his appeal that commissioners didn’t “do a fair job of analyzing the facts.” The attorney said commissioners now had a clear set of instructions from Rodgers on the criteria they must meet in order to issue a SLUP to River West in the future.

“That was Santa’s check list, and he's going to check it twice,” Parsons said. “(Rodgers) knows what he wants, he’s given them fair warning and he said take your time.”

Pine Street property owner Joe Sarafa told The Ticker Rodgers’ ruling was “completely expected” and that his team had been “prepared" for that outcome.

“We knew based on his decision in the Peninsula Township case where he sent it back to the commission for further findings just recently that that was a very high possibility here,” Sarafa said. “We have a great deal of respect for Judge Rodgers and for the process. We will go back and work with the city commission and staff to make sure we get the information he needs to make a fully informed decision, and to make sure the holes he sees in the record are filled.”