Traverse City commissioners will revisit a plan to solicit proposals from developers to build workforce housing on three contiguous city-owned parcels on Beitner Street and Woodmere Avenue at a study session Monday. Commissioners will consider the language of a draft request-for-proposals (RFP) outlining desired goals for the project – but will also hear concerns from city staff, who say the parcels are crucial to future city operations and should not be developed.

An ad hoc committee of commissioners – including Mayor Richard Lewis and Commissioners Tim Werner and Mark Wilson – have been working on the draft RFP since January. The committee was tasked with creating the RFP after commissioners last fall discussed selling three city parcels – located at 715 and 723 Beitner Street and 535 Woodmere Avenue – to be developed for workforce housing.

The proposed RFP states that the city’s goal is to “maximize the number of residential units,” “minimize the carbon footprint and parking,” and “create community through building design, a diversity of price points, and the prohibition of short-term rentals.” The city is “entertaining proposals to develop the three properties as one development,” according to the RFP, but the project can be phased so long as it is “undertaken as one effort by one developer.”

According to the RFP, the properties have an appraised value of $830,000 as of November. They are all zoned industrial, a district that allows for residential uses. Interested developers would be asked to submit a proposal including a letter of interest, concept plans and renderings, a description of housing unit sizes and rents, a proposed purchase price, development experience, an earnest deposit equal to two percent of the purchase price, team resumes, a proposed timeline, and “evidence of the development team’s fiscal capacity to undertake the proposed project.”

In addition to prioritizing projects that meet the above-mentioned city goals, commissioners could use criteria outlined in the RFP to select a development proposal. Special consideration will be given to proposals that “include most rental units that fall within 70 percent to 120 percent of the area median income (AMI) for Grand Traverse County, with a commitment to maintaining affordable rents for 30 years,” the draft states. Projects should also feature “long-term rental or ownership housing without short-term rentals, unless it can be demonstrated to be necessary for financial feasibility.”

Applications that incorporate “at least three units designated for community members experiencing homelessness” will receive additional points and be more favorably weighted, according to the draft RFP. “In addition, the city will consider these factors in evaluating proposals: the overall vision for the property, development team’s experience and financial capacity, and the proposal’s creativity in addressing stormwater management.”

In addition to discussing whether or not to proceed with issuing the RFP – and whether to use the RFP language as presented or make any tweaks – commissioners will also need to address concerns raised about the project. One of the parcels, 723 Beitner, has been committed as a staging area for the FishPass project. “The uncertainty of when and even if that project will proceed adds complexity to discussions regarding selling the Beitner properties,” wrote Mission North’s Rob Bacigalupi, who assisted the ad hoc committee with crafting the RFP draft. A list of possible alternate sites for FishPass staging has been provided to commissioners, but Bacigalupi noted that “any approval of issuing the RFP should be contingent upon securing a site agreeable to the FishPass contractor.”

Perhaps more pressingly, city staff are strongly opposed to selling the properties, citing their importance to potential future city expansion. Former City Manager Marty Colburn raised objections to the project last fall, citing concerns about the suitability of the parcels for housing, potential environmental contamination, and the city’s use of the site for construction staging and snow storage. Colburn also said the city’s department of public works would likely need to grow in the future, and that there would be “no better location for the future expansion of DPS operations” than the parcels proposed for housing.

Interim City Manager Nate Geinzer elaborated on those concerns in a memo to commissioners. He noted that the city and Grand Traverse County are currently undertaking a comprehensive assessment of all city and county-owned facilities. “It is important that the city commission is aware of two major recent developments in the facilities planning process,” Geinzer wrote. “There is high probability that the current law enforcement center on Woodmere will be decommissioned. This would result in the need for a new police station/law enforcement center.”

Geinzer also said that the current DPS site – including the property proposed for housing – has “become an important piece of property that would support what we are referring to as the Three Campus Plan. Staff is currently working with the county and our consultants with a focus on a shared use redevelopment of the DPS site that would create new synergies with public safety, possibly including a fire/EMS component and a collaboration between DPS and county facilities operations. There is very strong consensus amongst the city/county teams that the DPS Woodmere property should be retained (including the Beitner piece) for future operational redevelopment.”

Geinzer said that if the city and county move toward consolidating operations on certain properties as part of a Three Campus Plan, it could free up other “better suited properties that could be leveraged for attainable housing.” City staff “advises firmly against the loss of the Beitner property, which would result in not only a negative impact to city operations (but) would result in a lost opportunity for operational redevelopment and enhanced city/county collaboration,” Geinzer wrote.

“Staff believes that there are better opportunities ahead for attainable housing through the leveraging of city/county properties and city/county tools,” he added in conclusion. “However, our staff needs the time and space to continue our work with county officials and other non-profit/for-profit entities.”