Joseph Daly (left), president of Daly Merritt Properties Inc., fields questions on Monday from Wyandotte City Council members.
By ANDREA POTEET
Sunday Times Newspapers
WYANDOTTE — A contaminated city property and a portion of the city’s Municipal Services building will be sold to a local developer as is, City Council members say.
Amendments to the purchase agreement of the former police and court building by Daly Merritt Investments LLC were reviewed at Monday’s council meeting.
The new agreement, which was 16 years in the making, requires Daly Merritt to apply for a U.S. Environmental Protection Agency Brownfield Grant to clean up the contamination, which consists of lead from the gun range and gasoline from an emergency generator.
The grants is awarded to clean up and reuse “brownfields,” or sites contaminated with hazardous substances, which otherwise could be reused.
Since the city is responsible for the contamination, it cannot qualify for a brownfield grant, but the developer would, City Engineer Mark Kowalewski said.
“Since we can’t get the brownfield, it’s to our advantage to have the developer do it,” he said.
Daly Merritt plans to demolish the building to redevelop and resell it. Councilman Todd Browning brought up the prospect of an amendment prohibiting D-M from selling the property to a nonprofit, which would garner no tax revenue from the property for the city. D-M President Joeseph Daly, however, refused the proposed amendment.
The prior agreement required the city to demolish the current building and finance the cleanup at a cost of nearly $200,000 from a tax increment finance authority fund. The amended agreement allows the city to avoid cleanup costs and to repay the developer from tax revenue from other taxing entities, then glean taxes from the buyer for five years.
“Once the repayment is done, we’ll continue to capture dollars for five years afterwards,” Kowalewski said. “That’s five years of capture the city wouldn’t get if there was not a brownfield, so that’s a huge benefit to the city.”
The city also reviewed agreements for sales of a portion of the Municipal Services Building at 3005 Biddle. The outer part on the first and second floors adjacent to Biddle would be sold, and the inner portions of the building would be retained by Municipal Services.
D-M Investments, which also is the developer on the project, would apply for a Home Funds grant through Michigan State Housing Development Authority to convert the second floor to apartments, which would be rent-controlled for 15 years, as required by the grants. After that time, they would be sold as condominium units.
Municipal Services will not receive the purchase price from the sale until the condominiums are sold, but will receive $200,000 from a Urban Development Action Grant fund immediately on closing. The department intends to use the funds for future replacement of satellite dishes on the roof of its building, according to a letter to the council from Kowalewski, Financial and Administrative Services Director Todd Drysdale and Municipal Services General Manager Melanie McCoy.
(Contact Andrea Poteet at [email protected].)