Arsenic, Cyanide Spur Building Boomlet
TRAVERSE CITY – Weeds and broken concrete once greeted those who strolled alongside the Boardman River between Union and Cass streets 20 years ago.
The arsenic-polluted soil underneath scared developers away until a ground-breaking state and federal concept lured them back with tax credits, cleanup assistance, and other financial incentives.
Brownfield designation spurred the development of River's Edge in place of the weeds and concrete, giving rise to a fully occupied, mixed-use cornerstone of Traverse City's business community. More than 70 such sites remain in Grand Traverse County, and even though the state overhauled the popular program in 2011, demand has remained steady.
In place of the former brownfield and historic tax credits, the Michigan Economic Development Corporation now administers $100 million in funding for redevelopments that meet certain criteria on its eligibility checklist.
Although 21 separate projects have successfully gone through its program, the county does not recruit businesses to fill in the remaining sites, said Jean Derenzy, deputy director of Grand Traverse County Planning and Development, which oversees the county's Brownfield Redevelopment Authority.
"How do you choose one property over another?" Derenzy said, adding that it's up to the individual property owners to market the parcels.
Hotel Indigo is one of the county's highest profile brownfield projects, which will use an estimated $1 million in funds to clean cyanide, petroleum and metals out of the groundwater and soil.
After the cleanup is complete, JS Capitol Construction Inc. will erect an upscale, $14 million, 105-room hotel in its place, overlooking West Grand Traverse Bay. Completion is estimated for January 2014.
The underground parking lot will be wrapped in dense plastic to keep remaining polluted water from seeping inside.
Developer Jeff Schmitz has said he couldn't have done the project without the brownfield assistance.
River's Edge developer Burden has both praise and criticism for the program. In the two phases of River's Edge, he says he received less than promised in the first, but was paid for the entire cleanup on a second phase.
Part of the problem, he said, is dealing with the ever-changing nature of government through the course of a long project.
Overall, though, he believes it's necessary.
"I think it's a great tool and there are a lot of projects that wouldn't happen without the brownfield authority," he said.
Copper Ridge, a complex of office, medical and retail space, sits on the edge of Grand Traverse Commons on a Silver Lake Road site tainted by salt brine from the old county road commission garage.
The project is said to have created 513 jobs and increased the property's taxable value by more than 200 times.
It cost $70 million in private investment and $80,000 in brownfield funds.
The contamination on this site was "not significant," but needed to be removed before it could be developed – turning a liability into an asset, Derenzy said.
Another high-profile site is on the edge of downtown Traverse City, only this time to the east.
TBA Credit Union plans to build on East Front Street across from the Holiday Inn.
A gas station once operated there and the site is known to contain petroleum contamination, Derenzy said.
The thriving River's Edge paved the way for all of those developments by showing how it can help revitalize a site.
Before it was developed, the 8.5 acre lot that had been the home of Traverse City Iron Works was valued at less than $1 million, even though it was a mere stroll across the Boardman from one of the state's healthiest downtowns.
Now, it's valued at more than $34 million, employing, housing and entertaining people and generating taxes.