TRAVERSE CITY -- Grand Traverse County's Brownfield Redevelopment Authority wants to divert more than $9 million in local tax revenue from libraries, a community college, public transportation and programs for seniors and special-needs children.
Its goal: use taxpayer money to build another local parking deck.
Copper Ridge LLC and Munson Medical Center propose a $5.7 million parking deck to serve Munson's planned cancer treatment center and the privately owned surgery center at the Copper Ridge development on Silver Lake Road.
Munson would build the 316-space deck, and operate and maintain it.
Over the next 14 years the county would divert tax revenue intended for local governments in order to reimburse Munson $5.7 million plus interest. An interest rate has not been determined but the authority's 6 percent maximum rate could add more than $3 million to the cost.
Garfield Township Treasurer Dennis Habedank questioned the need to reroute taxes.
"If you want a parking ramp, build it yourself," Habedank said. "Why should our taxpayers pay for it?"
Millions in local taxes
If the outgoing county board approves the proposal when it meets Nov. 26, the brownfield authority will take control of more than 99 percent of all tax revenue that otherwise would go to the county, the township and other governmental units. The units affected include Northwestern Michigan College, the Bay Area Transportation Authority, Traverse Area District Library, the Grand Traverse Pavillions Medical Care Facility, Traverse Bay Area Intermediate School District, Grand Traverse Commission on Aging, and the township's joint recreation authority with Traverse City.
Copper Ridge sits on a 73-acre site overlooking Grand Traverse Bay purchased from the county road commission in 2000.
The property qualified as a brownfield site because of arsenic from pesticide use in an old orchard and some salt contamination.
Minutes from authority meetings in 2001 showed board members debated classifying former farmland with minimal contamination as a brownfield, but developers wanted the single-business tax credits that went with the designation. One authority member, according to the hand-written minutes, said it appeared the purpose in naming Copper Ridge a brownfield was to generate money for the developer and for the new authority.
At the time the property's assessed taxable value was $100,000. Today it's more than $22 million.
Taxing authorities, such as the Pavillions, currently receive taxes paid on the original $100,000 while the brownfield authority captures everything else. For example, in 2008 the Pavillions will collect about $65 of the $14,000 its millage raises from Copper Ridge.
The authority used the tax capture to reimburse the developer $99,000 spent on cleanup, including $30,000 for administrative costs. The authority has collected property taxes for its Local Site Remediation Fund for five years, ending next year. Copper Ridge has generated more than $1.4 million for the fund through 2008.
Remediation means clean-up of contamination, but the brownfield authority uses most of its money to help development projects, including a recent pledge of $1 million for the proposed Old Town parking deck in Traverse City.
Public or private benefit?
Jean Derenzy, director of the brownfield authority, said the economic impact of the cancer center will be far-reaching and important to the region. Without a publicly funded parking deck, Munson's cancer center would be limited in size and the types of cancers it could treat.
Not so, said Munson officials.
Failure to gain a public parking deck won't impact the hospital's plans for a cancer center but will influence its location, said Mark Anthony, a senior vice president for Munson Medical Center.
The hospital is evaluating three other sites around Traverse City for the cancer center, Anthony said. Copper Ridge is the only site that lacks adequate space for surface parking. A publicly funded parking deck, however, enhances Copper Ridge's chances of landing the $40 million project.
Anthony said use of local tax dollars for the deck is justified.
"Clearly the consolidation and expansion of cancer services in a convenient location that provides sheltered parking for patients suffering from cancer to protect them from the elements enhances the public welfare," Anthony said.
It would also benefit Copper Ridge LLC, owned by Constance Deneweth, a business consultant at Traverse City State Bank and member of the board of directors for Munson Healthcare, parent organization of Munson Medical Center; her husband Richard Deneweth, a real estate and business consultant; and Dennis Fedorinchik, president of Hallmark Construction. Along with the sale of land for an 80,000-square-foot cancer center to Munson, the project is expected to spawn $11.5 million in spin-off development that will "maximize overall density" at Copper Ridge, according to the written proposal.
State law changes
Previously, the state limited brownfield funding of infrastructure improvements such as parking decks to core cities. Townships were not eligible.
But a 2007 change in state law, co-sponsored by state Sen. Jason Allen, R-Traverse City, allows the county to use brownfield funds for the parking deck if the land is owned by a land bank authority.
As a result, Copper Ridge will donate land to Munson, which will turn it over to Grand Traverse County's Land Bank Authority for the parking deck, Anthony said.
The land bank authority would own the deck until 2023 then return it to Munson.
Grand Traverse County created the land bank to convert property seized for unpaid taxes to community use. Prior to the current Copper Ridge proposal the land bank took property it foreclosed and gave it to Habitat for Humanity.
The parking deck plan is not how the land bank normally operates but economic development is part of the land bank authority's strategic plan, said county Treasurer Bill Rokos. He also said the authority is doing it for the hospital because it's a nonprofit operation.
Tax captures
TRAVERSE CITY — Grand Traverse County proposes to redirect almost $10 million in taxes for parking decks over the next 16 years by capturing taxes from nine different local goverments. Taxes captured in 2008 and '09 by the county brownfield authority will help fund the proposed Old Town parking deck in Traverse City while taxes captured over the next 14 years will go toward building a parking deck at the private Copper Ridge development in Garfield Township.
| Taxing Unit | Total | Brownfield authority | Copper Ridge parking deck |
| Garfield Township | $1,708,000 | $126,000 | $1,582,000 |
| Grand Traverse County | $3,182,000 | $235,000 | $2,947,000 |
| Traverse Bay Area ISD | $1,872,000 | $138,000 | $1,734,000 |
| Northwestern Michigan College | $1,385,000 | $102,000 | $1,283,000 |
| BATA | $210,000 | $15,000 | $194,000 |
| Commission on Aging | $310,000 | $23,000 | $287,000 |
| Recreation Authority | $63,000 | $5,000 | $59,000 |
| Traverse Area District Library | $610,000 | $45,000 | $565,000 |
| Grand Traverse Pavillions | $421,000 | $31,000 | $390,000 |
| TOTAL | $9,761,000 | $720,000 | $9,041,000 |
Amounts are rounded to the nearest thousand.
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