IRONWOOD, MI - Friday, September 26, 2008 - The regular monthly meeting of the Downtown Ironwood Development Authority (DIDA) was held yesterday morning in the Community Development Conference Room on the second floor of the Ironwood Memorial Building. All nine of the Authory members were in attendance: Chairman George Goerig; Vice-Chairman Joe Karius; Mayor Bruce Noren; Louise Demasi; Eva Smith-Furgason; Corey Gresham; Jackie Powers; Steve Frank; and Wayne Ozark. City staff present for the meeting were DIDA Secretary Jane Bowman and Community Development Director Dan Petersen. Representing the media were Eric Hjerstedt Sharp, photo-journalist for the Ironwood Daily Globe; Lou Bonagura, webmaster and photo-journalist for IronwoodInfo.com; and yours truly. Citizens attending included Roy Ahonen, area businessman and former Mayor of Ironwood; John Cain, former City Commissioner; and Lynn Palmer, Coleman Engineering employee.

The meeting was called to order at 8:00 AM by DIDA Chairman George Goerig. Jane Bowman recorded the roll. The Commission then approved the minutes of the August 28, 2008 meeting and they also approved the docket. Issues considered by the Authority were as follows:

Flower Basket Project for 2009 - Jane Bowman informed the Authority that the company the City orders the flower baskets from needs a substantial advanced notice to properly fill the City's order. George Goerig confirmed Jane's comments stating that he had talked to Dan Adams about the baskets and Adams said the cut-off date was the end of October.

According to Bowman, the flower basket fund -- which is donated entirely by downtown businesses -- is now depleted. Goerig  explained to the Authority that letters should be sent out to the downtown businesses asking, once again, for their donations to support the project.

Bowman asked the Authority to consider the fact that the City's flower watering equipment will need to be replaced soon. Smith-Furgason questioned the age of the watering system stating that there should be warranties on such things. Bowman revealed that the system is over ten years old and it is just worn out. Noren suggested that prices be gathered of similar new units and be brought back before the Authority in the near future.

Bruce Noren asked if the Authority might want to consider something other than flower baskets -- like hanging banners -- as decorations for next year. Nearly all of the Authority members agreed that the flower baskets were attractive, and several of them mentioned that they were very well cared for this summer.

Steve Frank said that he thought the flowers looked good, however, he would  also like to see the DIDA start investing permanent decorations much like those Hurley has. He said it would be nice to have steel cut-out signs continuing Hurley's look with more of a mining theme.

Citizen Lynn Palmer addressed the Authority stating that she feels the flower baskets genuinely enhance the look of the downtown. She explained that they act as a guide or outline for the City. She urged the Authority to continue with the program.

Lou Bonagura, who is a member of the Master Gardeners, said whoever watered of the baskets this year did an outstanding job -- in fact, he said, "she did the best job we've ever had" --  and a letter of praise should be sent out to her. On May 16th, the DIDA chose Carrie Ann Kasieta to do the watering. Jane Bowman told the Authority that a letter was sent, along with her final check, praising the good job she did. According to Bowman, Ms. Kasieta called her back and said she was willing to water the plants for free, demonstrating her enthusiasm for the job. Bonagura went on to say, "She's is so conscientious it's unbelievable."

Bowman told the Kasieta that she would be first on the list for next year because she did such a terrific job this year. [06:23]

Holiday Decorations - Louise Demasi told the Authority that she talked with George, Jane and Dan and she had a letter drafted explaining the need for holiday decorations. She said she planned on going door-to-door to all of the downtown businesses requesting donations to buy the decorations. She explained that she already got a wreath and garland bid from Charles and Mimi Moncher and she planned on getting a bid from Avid Sivula as well. She said she would like to bank the funds the DIDA currently has, and hopefully be able to add to it this year with donations, and perhaps purchase permanent decorations to go along with the wreaths with next year. The Authority agreed to allow Louise to solicit donations and Jane to poll the Authority via telephone regarding the final bid if it is necessary.

Lou Bonagura suggested that the DIDA invest in commercial grade lights for the pocket park. He pointed out that buy the cheap residential grade lights was not working, in fact, in the long run they were probably costing the City more. He said ideally, the best alternative would be to buy LED lights because they last considerably longer than traditional lights. Steve Frank said that the LED lights use less electricity and last longer, so he believed they were the best choice.  

Demasi asked Noren if he thought the City Commission would pitch in half of the money. Noren said it wouldn't hurt to ask. The Authority agreed to gather some prices, make an appeal to the Commission, and re-examine the options at the next meeting. [10:18]

Staff Updates - Dan Petersen addressed the Authority with the following updates:

• DIDA Web Page - Petersen told the Authority that he was hoping to have the web page up and running already, but he was experiencing problems with the software. He said he plans on having a starter web page ready within the next few days. [00:38]
• Signage - Petersen showed the Authority the sandwich board signs, the Hiawatha sign, and the sign for the US-2 Silver Street intersection. He pointed out that Steve Frank was responsible for ordering the signs. Saari Signs constructed the signs and he did an outstanding job. (SEE ATTACHED PHOTOS) [00:55]
• Lou Bonagura's Resignation from the Pocket Park - Dan Petersen explained that he received an email stating that Lou Bonagura was resigning from the Pocket Park. Bonagura told Petersen and the Authority that such was not the case. Bonagura requested to be on the agenda for the next meeting to discuss some serious problems concerning the Pocket Park. [01:11]
• DIDA Letter to Jim Albert - Petersen told the Authority that a letter was sent out to Jim Albert regarding his allegations that the Authority's Vice-Chairman was engaging in unfair business practices with regards to the Superior Chronicle. The letter asked that Albert's allegations be put in writing and submitted back to the Authority. Petersen said the Authority did receive a very short response. This reporter explained to the Authority that audio records mention nothing of a letter or a need to provide my allegations in writing. [02:20]
• Facade Improvements - MSHDA was recently at the Memorial Building and they were very impressed with the work Jane Bowman was doing administering the program. A lengthy discussion about blight issues downtown ensued. [24:20]
• DIDA Member on the Jack Frost Committee - Steve Frank nominated Jackie Powers to serve on the Chamber of Commerce Jack Frost Committee. She semi-reluctantly agreed to serve. [01:04]

Citizens Address Authority Regarding Hovey Project - Roy Ahonen addressed the Authority regarding the proposed Hovey Towering Pines Low-Income Apartment complex on Ayer Street. He said he noticed as he waited to address the Authority that blight in the downtown is a major concern. He pointed out that the blight problem would only increase once the Hovey apartments are a reality. He said the proposed complex would devastate the existing apartment owners, of which the downtown has many. He pointed out that the 2% PILOT (Payment in Lieu of Taxes) was grossly unfair to existing apartment owners. He said he pays over 20% of his rental income in property taxes. According to Ahonen, the new complex short-changes the County, the College, the City and the Schools.

Ahonen told the Authority that a recent article in the Globe stated that there was little opposition to the project until Monday's City Commission meeting. He read a letter he sent to City Manager Scott Erickson and to the City Commission on January 29, 2007. (The letter also appeared in the Globe as a letter to the editor.) Here is his letter as it appeared in the Daily Globe as it appeared on February 21, 2007:

The approval by the Ironwood city commission of a subsidized 49-unit apartment complex is very disheartening and misguided.

There's no market in Ironwood for such an increase in apartment units. There is a glut of apartments presently available on the market.

We have been in the apartment rental business in Ironwood for 43 years and this is the softest rental market we've ever seen. Our vacancy rate is the highest it's ever been.

The result of building 49 new units will be 49 more vacancies in apartment complexes in the Ironwood area.

It's wrong for the government to subsidize and give tax breaks to new people in the area in direct competition with existing property owners who don't get such advantages.

In this American free enterprise system, we welcome fair and free competition, but let's play the game on a level playing field.

This unfair treatment will cause undue financial hardship on present apartment owners.

This complex will receive city services such as police and fire protection, snowplowing of streets, etc. and their children will be attending our public school. All these extra costs will be borne by the taxpayers of the city of Ironwood, increasing their taxes. There is not even a provision for inflation in the paltry sum they will be paying for so-called "service charges." The city's infrastructure costs could easily triple in the 35-year time frame for this project.

The citizens of Ironwood would be better served if time, energy and money was spent finding new manufacturing companies to come into Ironwood to provide good jobs for our people. We need more companies like Jacquart Fabric Products and Ironwood Plastics, not more apartments.

Apartments do not create jobs.

Ironwood's population and school enrollment is declining. There are some 500 vacant dwellings in the area. The streets are in a horrible state of disrepair. These are issues that should be addressed. When these trends are reversed, the population begins to increase and the need for more housing arises -- as always in America the private sector will respond and provide it.

As one who was born and raised in Ironwood, operated job-producing companies, and even served as mayor, I am not very proud of my hometown of Ironwood at this moment in time.

I sincerely hope that you will rescind this ill-fated decision.

Ahonen also heavily referred to the address he wasn't able to personally deliver to the Commission on Monday, due to an illness. Here is his Commission address verbatim:

Good evening and thank-you for giving us this time. My name is Roy Ahonen and I represent a group called the Concerned Citizens of Ironwood, many of whom are here this evening. We want to share with you our thoughts concerning the proposed Towering Pines apartment complex, and the reasons we oppose this project.

Is there really a need for 49 additional rental units in our area?

Despite what the alleged market survey states, we have evidence that a glut of vacant rental units, including low-income properties, exists in Gogebic and Iron Counties. All of the rental property owners we contacted report serious vacancy problems over the past two years. Most of these vacancies are MSHDA certified. Additionally, two of the apartment complexes that are regularly running block ads in the Daily Globe are low-income government projects: Mill Trace Apartments, a HUD development, and Wildwood Manor, a MSHDA project. If a market survey was done to determine the need for such a project, why were none of the rental property owners that we canvassed ever contacted, at any time, by anyone, regarding vacancy rates or market conditions?

While we believe that the lack of a proven need should be enough to stop this project, there are other issues that need to be examined. These include the suitability of the proposed site, the effect on real estate values, the costs to Ironwood taxpayers for needed infrastructure, the fairness of the proposed payment in lieu of taxes, and the potential impact on our downtown.

We believe that this project was initially supported by those who had inadequate information. Furthermore, insufficient publicity resulted in many citizens being unaware of "Towering Pines", "Hovey", or the details of this development. "Why not?" "What can it hurt?" "At least it's something!" were all given as justifications for this endeavor. These are not sufficient reasons to support a project of this scope.

Since the PILOT ordinance expired in January, we believe that now is the ideal time for you, the City Commission, to reexamine your support for this project.

Before Ahonen could continue, Chairman Goerig interupted him and informed him that he had a three minute limit. [12:27]

Former Pamida Building - Ahonen mentioned that he owns the former Pamida Building and that many improvements have recently been made. He told the Authority that the building is currently being rented for storage facility. He said the lease on the building runs out at the end of October. He asked the DIDA for their assistance to attempt to market the building as a light industrial business. He wanted to know what kind of incentives the City offers that would make that would entice prospective tenants to the locate in his building downtown. Both Bruce Noren and Dan Petersen told Ahonen that they were interested in the building.

Noren played around with the concept of utilizing the building as a "growth center" or incubator. He mispoke stating that there was no grocery store downtown. Eva Smith-Furgason, Manager of the Northwind Natural Food Co-Op, was quick to correct the Mayor's statement.

Noren apologized and then continued that there was no "Carlson's" or any other supermarket downtown. He proposed a convenience store or a supermarket in that space as an anchor business to the downtown.

Ahonen again asked what incentives the City offered. Chairman Goerig encouraged Mr. Ahonen to attend the Blueprints Program Public Hearing in January. [04:30]

Authority's Response to Hovey Project - Louise Demasi said, "It's a known fact that we spent quite a few hours looking for some marketing survey that must be hanging upstairs from the building because we haven't found it yet. But, that has to be found. And how did they do this survey? I've heard a couple of different stories from different people up here." She said she heard the survey was created using the Multiple Listing Service (MLS) for apartments for sale. She pointed out that such a list says nothing about the rental market.

Roy Ahonen told the Authority that several of the Concerned Citizens requested a copy of the marketing survey through the Freedom of Information Act, and nobody ever was supplied with the document.

"I don't believe it exists!" Demasi said.

Several other members of the Authority voiced their opposition to the Hovey project. Steve Frank said having the new apartment complex will make it much more difficult to convince people to purchase downtown buildings with rental units upstairs when they have to try to compete when the cards are stacked against them -- downtown businesses have to pay school and property taxes; they have to pay TIF DIDA taxes; and Hovey pays next to nothing. Wayne Ozark said the project will only create more abandoned buildings downtown.

Joe Karius defended the project saying "First of all, we need to take a big picture too. A new development anywhere in the City probably is a good thing for downtown in general. We want new development." He told the Authority that the Economic Development Corporation (EDC) is sponsoring a big program at the Gogebic Community College on why cities need to "bring people in" rather than worry about job creation.

"Maybe new apartment buildings are a draw to bring people to our area." Karius said, "If we bring people to our area, yes, they're going to be in our schools. That helps our schools in this area. So there's the other side to the question here, that this isn't just a negative, that it may compete with downtown apartments. The positive is, it may bring new people to the area, which in turn, generates development. That is the new theory that has been preached for the last couple years."

Wayne Ozark said, "In other words, you're going to be bringing people in who haven't a job anyway. They're going to be in the dome! They're going to be getting subsidized... that's not going to be helping anything!"

Goerig asked that Ahonen copy all of his documentation on the Hovey project so the Authority could sift through it to determine which is factual and which is not. [15:12]

John Cain on Hovey & Blight - John Cain also addressed the Authority regarding the project. He pointed out that he lives downtown and across the street from him there are several rental property, all of which are empty. He posed the question, "I have three apartment buildings across from me that are unfinished. Who's going to buy them if Hovey comes in?"

To that Chairman Goerig said, "Well, I'm waiting to see what the bank says!"

He said he pays his fair share of taxes -- school taxes, county taxes, city taxes, etc. He said he'd like to have the same deal as the Hovey PILOT. He said he hears the blight complaints regularly and he doesn't want to see any more empty blighted buildings downtown. He noted that the City seems to pay close attention to marketing studies and surveys, but he has yet to see a survey that asks the people of the community what they want in the community. [04:06]

Mural Discussion - Jackie Powers pointed out to the DIDA that the Authority was not being consistant. She went back to DIDA minutes and showed that the Authority had previously addressed the issue of murals and was going to put the issue on hold pending the recommendations of the Blueprints Program. After a brief discussion on the Taplin mural project, the meeting was adjourned. [08:06]

EDITOR'S NOTE: When White Pine closed shop, how many people from Ironwood left the area to find a "nice apartment?" People leave an area and move into another area to find work! Just because some out-of-touch bureaucrat preaches some ridiculous theory doesn't make it fact. Did Joe Karius move to the Ironwood area because he found a nice home in Hurley? Did George Goerig leave Texas because he couldn't resist the house he found on Arch Street? How can anyone -- especially a transplant to the area -- embrace such an asinine theory? Unless you are retired, on the system, or independently wealthy -- you move where the work is! The reason this country's in the shape it's in, is because government has adopted ridiculous theories such as this. Tell the thousands of assembly workers whose jobs have been outsourced to China or Mexico that job creation isn't important and you'll end up with a baseball bat across the side of the head.

I'd support a new apartment complex:

• if there truly were a need for more housing
• if either a local developer or an out-of-town developer used local contractors to build the housing complex
• if the project created jobs
• if the developer paid his fair share to taxes
• if the developer paid the same utility charges as everybody else
• if the developer were honest with the people
• if the City weren't "partnered" with the developer (Ice Rinks, Tennis Courts, Walking Trails, etc)

I'm sorry, but not all development is good development. Contrary to the "latest" theory "bringing people in" does nothing to improve a community. Unfortunately, the City of Ironwood operates in "Welfare Mode." The only time projects get done is if the City can gather grant money to do them.

At one time, a city's tax base was it's lifeline. In order to increase revenues to make improvements cities needed to build their tax base. Jobs enabled people to either rent or build. In the past, tenants paid their rent, from their pay checks to their landlord. Many people bought houses with the money they made. Landlords and homeowners pay property taxes! The more property sold -- the higher the tax base. Employers also pay taxes, once again increasing the tax base. Job creation should be the number one priority for the City of Ironwood.

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