City or Township?
It's been a long, bumpy road to new homes near Saline.
by Sheila Beachum Bilby
From the December, 2017 issue
In 2005, a Bloomfield Hills developer paid $2.95 million for a 117-acre tract of farmland in Saline Township on the city of Saline's western border, with plans to build luxury homes. Yet the only activity the site has seen so far has been seasonal crop rotations of corn, soybeans, and wheat as the city, township, and developer haggle over providing water and sewer services to the proposed housing development, Andelina Farms.
Another setback came in August, when the Saline city council decided not to move forward with a potential tri-party agreement that would have brought the parcel into the city but with water and sewer service provided by a private utility in the township. Now the issue moves back before the township board of trustees on November 13, with developer Pinnacle Homes again seeking the township's blessing to proceed.
"We're in the township, so we'll just work through the township," says Howard Fingeroot, managing partner for Pinnacle Homes. Fingeroot headed land development for national builder Pulte Homes before teaming up with builder Steve Friedman at Pinnacle. As land prices fell during the real estate crash, they snapped up developable sites--including some that Fingeroot had purchased before, for Pulte, at higher prices. Today they're building about 250 homes a year in fourteen communities in southeast Michigan.
Fingeroot says they look for places like Saline, established communities with good school systems. Located between Michigan Ave. and Austin Rd., Andelina Farms would feature 150 single-family homes starting at around $400,000, built in three phases of fifty homes each, and 110 multifamily homes--either rental apartments or condominiums priced in the high $200,000 to $300,000 range. Twenty acres on Michigan Ave. would be set aside for future neighborhood commercial businesses.
Fingeroot says a typical Pinnacle project takes a year to eighteen months to get underway. Andelina Farms has already consumed almost five years of meetings, public hearings, negotiations, and an extensive study of Saline's wastewater treatment facility, for which the developers ponied up
$100,000. Now they're eager to break ground. "We own the land," Fingeroot says. "We feel we have a right to develop. We're consistent with the master plan of the township."
The developers first approached the township board about Andelina Farms in early 2013. The next year, they submitted formal plans to provide sanitary sewer by connecting to the nearby private utilities system that services the River Ridge manufactured home community and the Austin Commons II condominiums, both south of Michigan Ave. But there was a hitch: the township and the River Ridge developer would first have to agree to amend an August 2005 consent judgment that prevents the River Ridge wastewater treatment system from being "used in connection with any other lands." The judgment settled a lawsuit between the developer of River Ridge and Austin Commons and the township, which is determined to maintain its rural character.
The township doesn't oppose development of the Andelina Farms property--it just doesn't want the liability that comes with providing sewer and water service, or the density that goes with it. "We are a rural township, and we would prefer to stay that way," says Saline Township supervisor Jim Marion. "We prefer to see that property go into the city."
So in late 2014 the township encouraged the developers to pursue an Act 425 agreement, which permits local governments to transfer land for a specific period of time "for the purposes of an economic development project." For twenty months, Fingeroot's group worked with the city to explore whether it would be "economically feasible" to extend city water and wastewater treatment services to the proposed development. Ultimately, the developer determined that the $24,000 cost per home for city water and sewer hookups was too high.
The city remains firm that all homes in the city must have municipal water and sanitary sewer services. "I believe that when properties are brought into the city of Saline they need to accept our water and sewer services," says Saline mayor Brian Marl, "and that's a point I'm not willing to negotiate."
The Andelina Farms issue has been further complicated by the city's travails over the condition and capacity of its own wastewater treatment facility. Saline just completed $3.5 million in upgrades and plans to spend another $2 million next year on new technology that "may resolve about 99 percent of the noxious odors" plaguing nearby neighborhoods, Marl says. The city also directed Tetra Tech, a consulting and engineering company, to explore sites for a new wastewater treatment facility. Marl says the city's plant now is using about two-thirds of its capacity, but the state requires the city to formulate plans for "how you are going to grow or expand capacity once you get to 85 percent or higher."
"I think this is an ideal time to explore a number of these issues," he says. "One, because we're seeing increased demand for land and utilities in the greater Saline area, and, two, we have some time because we're not close to that 85 percentile."
For much of this year, the city, township, and developer worked on a draft Act 425 agreement to transfer the parcel into the city, with Andelina Farms' future homeowners eligible for all city services except water and sewer--those would have been provided by the River Ridge utility under an amended consent agreement. In exchange, the township would have captured 1.5 mills of property taxes on the development for fifteen years.
But in August the Saline city council pulled the plug on the agreement, echoing the mayor's concern that it would not be good policy to allow city property to be serviced by private utilities in the township.
The developer's remaining options are limited. They still want to use River Ridge water and sewer services and in late summer had a draft agreement to do so, but some Austin Commons II homeowners opposed the plan at recent township board meetings. The developers also could sink their own wells for water and pursue authorization to tap into the River Ridge sanitary sewer system or, alternatively, build their own water and wastewater treatment utility.
Despite the hurdles, Fingeroot remains bullish on Saline: "It's a great community." And he's optimistic that next year, work will finally begin on Andelina Farms.
[Originally published in December, 2017.]
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