TRAVERSE CITY — Developers hoping to build on city-owned land in downtown Traverse City now have a road map to submitting the right proposal.
City commissioners on Monday agreed to issue a request for proposals for land on State Street between Pine and Union streets. After considerable debate and a few last-minute tweaks to a scoring rubric, they settled on a request that prioritizes below-market rate housing — and the ability to build it.
Mayor Pro Tem Laura Ness called for scoring a developer’s experience and financial capacity higher than any of the seven other scoring categories.
“My opinion is that it does need to be weighted higher than the other categories, because without — higher than housing, because without it, you don’t get housing,” she said, in part responding to a question from Commissioner Heather Shaw.
Commissioners referred to Homestretch Nonprofit Housing trying but failing to line up the financing necessary for its proposed five-story, 44-unit apartment building on parking Lot O. The affordable housing developer agreed in January 2023 to buy the parking lot at State and Cass streets, but twice failed to meet the city’s deadline to find the financial backing needed to build the apartments.
City leaders opted to hold off on the Lot O project in January, a month after developer John Socks proposed a different project on other city-owned land. He pitched a six-story, 534-space parking ramp paired with below-market rate apartments and first-floor retail for the mostly vacant property on State Street between Union and Pine.
City Manager Benjamin Marentette previously told commissioners he favored giving any developer interested in the property a shot through a request for proposals. He hired Mission North for $7,130 to draft one, and on Monday, consulting firm Principal Rob Bacigalupi heard commissioners’ input on the draft.
Commissioners agreed that any proposal should include public parking, as Socks suggested in his pitch. He had offered to keep the first two floors of the parking deck in his proposal open to the public, then lease out spaces in the upper four to pay back construction loans.
Developers would also have a chance to submit their proposal with and without fully electrified utilities. While city policy requires that for any development on publicly-owned land, Mayor Amy Shamroe noted the commission can waive that policy if they believe it’s in the public interest.
That prompted some debate over scoring a submission’s alignment with that city policy. Shamroe likened any points for that category as a given, since all proposals are supposed to be electrified.
“It’s almost like giving everybody 10 points on your quiz just for showing up, because that’s what they’re supposed to put in it,” she said.
Commissioner Lance Boehmer noted the policy has several components, so a proposal might satisfy policy requirements to varying degrees. And Shaw said not giving electrification its due consideration shows the city doesn’t care much.
Ness responded that, while the city can waive the policy, any developer expecting that waiver should probably score lower in that category.
The city should also consider any public benefit the development would offer in light of what the developer is offering to buy or lease the land, Commissioner Ken Funk said. The city already invested $7.6 million in the property.
Commissioners deliberated over many other parts of the request for proposals, from building design criteria to whether the city should give preference to any project with sturdier foundations to support extra stories — Shaw questioned this, but Shamroe noted that a developer could propose something taller than 60 feet. They wouldn’t have to, and if they did, city voters would have to approve the plans per a 2016 charter amendment.
Developers will have until June 11 to submit their proposal, according to the request. Commissioners tentatively could pick a proposal by July 6.
From there, a design team of city department leaders will review and score the submissions, according to Bacigalupi and Marentette — the city manager told commissioners he would forward all submissions to them, regardless of how they scored.
The request for proposals marks the latest chapter in the long saga of Traverse City’s long-contemplated but heavily disputed west end parking garage. Originally part of the TIF 97 slate of projects for the downtown tax increment finance plan, original proposals date to 1997 with numerous twists and turns along the way.