Multi-family

Arbitrary and Capricious Fees

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Letter to Culver Town Council

I just received the billing for this year’s Fire Protection Sprinkler System fee for Sand Hill Farm Apartments in Culver. I have discussed this fee here and here in the past. Despite protesting the initial basis for this fee, and the proposed increase during budget season, an 83% increase was passed.

The previous cost, $1,203.81 + sales tax was excessive and unjustified. The 83% increase to $2,198.98 + sales tax is nearly twice as onerous! There is no inspection or scheduled inspections, no maintenance, and no record-keeping. The only justification given is the cost of bringing water to the site, which the municipality would do anyway for residential service. Reasonably, water usage for a fire in a building with sprinkler system would be significantly less than that used to fight a fire using traditional methods, since fire sprinklers generally put out the interior source before the building is engulfed. I’ll just skip over the whole idea of why there’s sales tax applied, other than to ask, what is being purchased?!

In the United States we have a generally progressive income tax system where individuals are taxed more when they make more. Conversely, we often have regressive fees that disproportionately hit the lower end of the income level. Culver’s Fire Protection Sprinkler System fee is an example of a regressive fee. There are not that many buildings with fire protection sprinkler systems in Culver, but those that do have it vary widely in size. A one-size-fits-all per building fee doesn’t take this into account. Of the buildings being affected by this fee, five of them are residential and subject to some form of rent control. Since there was a rather large rate increase to the water bill passed at the same time, this puts these lower income residents subject to a double hit.

7-24-25 email to Council President

Culver recently adjusted building permits. They were changed from a because-we-can high rate to a cost-of-service rate, justified by time tracking completed by the Culver Building Commissioner. This is a much more reasonable and defensible way of determining fees. If this were applied to the Fire Protection Service System fee, it would likely be zeroed out.

In the current Town Council’s defense, the water service fees have been left unchanged too long across the board, resulting in a larger than average increase. The blame for that lies on previous councils. That said, it’s not appropriate to hit the most vulnerable in the town’s population with an extra fee just to save a few cents on everyone’s water bills as the new fee structure is rolled out.

Water Street Townhomes Roofing

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Water Street Townhomes 4-25-25

The Water Street Townhomes project in Plymouth is moving right along. The exterior framing is complete. Most of the doors and windows have been installed, except the storefront aluminum windows and entrances for the commercial space. The roofing is underway. (You can see the materials placed on the roof in the picture to the right.) Plumbing Rough-in is underway. We’re building the interior stairs.

Mayor Listenberger gave me permission to take pictures from the Council Chambers windows, so I get the aerial photos like this one without purchasing a drone. (Though a drone purchase is on the list. Ha!)

The project has been taking a beating on Facebook! And to think I accused Culver of having the most active CAVE Society in Marshall County! I found some amusement in these comments:

  • The project is hurting downtown businesses by closing the parking lot. (We didn’t close it until after Christmas. It will be back open before next Christmas. There’s a MACOG study showing that downtown Plymouth has twice the parking needed. The parking lot will have more spaces when we’re done.)
  • The project will not be affordable. Latest, highest rent number I’ve seen in the comments is $5k per month for one of the townhomes, though others are saying it is housing for illegal immigrants and there will be multiple families in each unit. Hmmmm… “Multiple” sounds like more than two, so three families in each unit at $2,500 cash per family tops that $5k per month projection!
  • And I particularly liked this exchange between two people in the comments:
    • Person 1 – “Do we really need this!?”
    • Person 2 – “We just went through a housing study that says we need an additional 1,300 dwelling units in Marshall County.”
    • Person 1 – “Then what good will 14 units do!”
    • Person 2 – “It’s a start!”

The City administration and Common Council have been supportive of this project. I attended a Downtown Merchants’ Association meeting last year and they were also supportive. I participated in two housing studies, one by United Way of Marshall County and one by MACOG, both or which came to similar conclusions about the need for additional housing. I’m pretty confident this will be a positive addition to Plymouth.

Housing Density Answers from the Past

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This is an interesting video with examples of multifamily housing on small lots (3 Flats) as seen in Chicago, Boston and San Francisco. It discusses some of the benefits as well as some of the drawbacks to this type of construction. It also briefly discusses some of the zoning barriers that were put in place to prevent this kind of construction.

It’s interesting that both Culver and Plymouth are looking into how to increase housing density right now, but are facing some pushback on the zoning changes that would be necessary to make this viable. Both communities seem to have active CAVE societies. I’m pretty sure every community has it’s own chapter. Years ago Erik Freeman and I proclaimed Culver’s unofficial motto to be, “Change is Bad; Even if it is Change for the Better”. Cast that as counterpoint to the underlying drumbeat for affordable housing.

Along with the basic zoning barriers, there are are other social and regulatory barriers that would increase challenges. Three story apartment construction would likely force the installation of fire sprinklers. Accessibility might need to be addressed due to the “walk-up” configuration with half a flight or more of stairs. Fire resistant construction between buildings would conflict with escape window requirements for bedrooms. All of these things would make the units safer and universally accessible, but would also drive up the cost. Meanwhile the three examples discussed are still in use in their respective cities; sometimes revered due to their place in the city’s history.

Greater density, even with the cost-increasing challenges listed above, does reduce costs of infrastructure, another big factor in housing affordability. Fewer linear feet of infrastructure is needed per dwelling unit. When this is done for infill properties, it makes better use of infrastructure, including roads, water lines and sewer lines. The one caveat to that is it may well increase impervious surface, further taxing storm water systems, though that is not a given. (They don’t have to be built cheek to jowl as was done historically, particularly in an infill situation.)

Reinventing the wheel can result in some improvements, but also can create some difficulties that were solved in the past. Looking back on what worked, may be part of our solution to the housing shortage problem as we move forward.

Water Street Townhomes Update

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I’ve been remiss in posting project updates, but you can always see what’s been posted in the past using the search box at that shows up on most pages. You can click here and see what’s been posted.

This project has had some struggles getting off the ground. Despite having funds from READI and the City of Plymouth to invest, getting a construction loan and securing permanent financing proved a challenge. Construction costs remain high and getting to an acceptable debt service ratio was challenging. We spoke to nine financial institutes before settling on Interra Credit Union for this project. Even after making that decision, the commitment process was slow. All of the financial institutes seem skittish about committing to long term financing in the current market.

Jeff Houin, Taryn MacFarlane, Randy Lehman, Kevin Berger, Lynn Gorski, Mayor Robert Listenberger, Don Ecker,Brent Martin, Linda Starr, Dave Morrow, Mike Miley, Alan Hauger

We have made our first draw request to READI on January 15th and currently are being told it may be another 30-45 days before we see funds released. We made our first draw request to the City of Plymouth on January 8th to start the process for approval with the Redevelopment Commission meeting on the 21st, but despite approval there, the bond fiduciary has not released funds to us. It is hard to complain about the injection of funds that make this project possible, but the delays mean we will incur additional interest expense to cover costs until the payments come in.

We broke ground on the project December 17th, 2024. Those gold shovels have traveled to a lot of sites over the years! Mayor Listenberger asked us to delay actual construction until after Christmas to keep the parking lot open for holiday shopping. We literally broke ground December 26th, with excavation starting that day.

Progress as of 1-27-25

Excavation is mostly complete for the building footprint. We have been fortunate that most of the debris we have uncovered has been relatively easy to remove. As always, there was some “fun” stuff, like an active waterline that ran back under the parking lot, through the excavation, from Water Street before it was capped. That made for a muddy day before being resolved. As of now, footings are in place for the townhomes and a large percentage of the basement walls are complete. We should see basement waterproofing start this week and backfill shortly after that. We’re working through the framing shop drawings to get the wall panels released.

We are still looking for completion in late Fall of ’25. We would love to accelerate that if we can!