Title
Resolution to Approve a Grant Agreement with the Ann Arbor Housing Development Corporation to Support the Development of a Sustainable and Affordable Housing Project at 2810 Boardwalk and Appropriate Funding ($500,000.00) (8 Votes Required)
Memorandum
The City of Ann Arbor has set a series of aggressive goals related to climate action and sustainability, including supporting affordable housing developments with 100% clean and renewable energy.
The Ann Arbor Housing Commission (“AAHC”), through its 501(c)(3), the Ann Arbor Housing Development Corporation (“AAHDC”), is working with Eisenhower State Land Development Company (“ESDL”) to develop a stand-alone building, within the Arbor South development, as sustainable and affordable housing. The affordable building includes a 183,489 square foot, 6-story building that includes approximately 200 one-, two-, and three-bedroom apartments with resident community space and staff offices. All residential units will be affordable to households with incomes at or below 60% of Area Median Income (“AMI”), as restricted by Low Income Housing Tax Credits (“LIHTC”).
The building will have the following sustainable features:
• Compact development with connections to existing infrastructure and public transit to reduce car dependency
• High-performance building envelope to minimize heat loss/gain
• Energy efficient HVAC systems, appliances, and lighting to reduce energy demand
• Geothermal ground source heat pump system
• Full-building electrification, eliminating Scope 1 carbon emissions (aside from emergency generator)
• Solar-ready provisions, supporting future renewable integration through the Ann Arbor Sustainable Energy Utility
• Low-flow fixtures and water-efficient appliances
• Stormwater management systems to reduce runoff and protect local ecosystems
• Responsibly sourced materials including local materials and recycled content
• Low-VOC materials to improve indoor air quality
• Ventilation systems that meet or exceed ASHRAE standards
• Moisture control and mold prevention through proper detailing and construction practices
• Activity spaces included on site for dedicated recreation and exercise
• Materials and orientations to educate occupants on sustainable features
• Ongoing maintenance plans to sustain performance over time
The total development cost is $94 million, which includes $7 million in hard costs for the green and sustainable features. While most of these improvements will lead to notable operational savings, given the tight upfront budget, the AAHC is seeking additional funding support to achieve its goal of making 2810 Boardwalk as sustainable as possible. The Ann Arbor Office of Sustainability and Innovations has a goal of advancing sustainability at affordable housing sites and has fund balance available from unexpended dollars in the County Mental Health and Public Safety Millage Fund and the approved FY27 OSI budget.
Budget/Fiscal Impact: A portion of funding for this grant is available in the County Mental Health and Public Safety Millage Fund balance for Sustainability and Innovations, $191,203.20 of which is already appropriated for expenditures in FY27 and $162,379.00 of which remains in fund balance. The remaining $146,417.80 is available in existing FY27 Climate Action Millage funds. With this resolution, all funding dedicated to climate action/sustainability as part of the County Mental Health and Public Safety Millage will be expended.
Staff
Prepared by: Missy Stults, Sustainability and Innovations Director
Reviewed by: Valerie Jackson, Assistant City Attorney - Sustainability
Reviewed by: Kim Buselmeier, Financial Manager
Reviewed by: Milton Dohoney Jr., City Administrator
Body
Whereas, The Ann Arbor Housing Commission, through its 501(c)(3), the Ann Arbor Housing Development Corporation, is working with Eisenhower State Land Development Company to develop a stand-alone building, within the Arbor South development, as sustainable and affordable housing;
Whereas, The apartments in the development will be rent- and income-restricted to households with incomes at or below 60% of Area Median Income (AMI);
Whereas, The sustainability features comprise an estimated $7 million of the $94 million development budget for this project;
Whereas, These sustainability features will lead to notable operational savings for the Ann Arbor Housing Commission, but present a challenge to the upfront development budget;
Whereas, Through the A2ZERO Carbon Neutrality Plan, the City has set an aggressive goal of achieving community-wide carbon neutrality by 2030;
Whereas, One of the key actions of the A2ZERO Plan is investing in helping affordable housing sites become more sustainable;
Whereas, The Office of Sustainability and Innovations has $353,582.20 remaining from the County Mental Health and Public Safety Millage, $191,203.20 of which is already appropriated for expenditures in FY27 and $162,379,00 of which remains in fund balance;
Whereas, The Office of Sustainability and Innovations has funds available in its Fiscal Year 2027 budget to support the remaining $146,417.80 of the proposed grant amount to support sustainability features at 2810 Boardwalk, and
Whereas, City staff recommend approving the attached $500,000.00 Grant Agreement to support the development of a sustainable and affordable housing project at 2810 Boardwalk;
RESOLVED, That City Council approve a grant in the amount of $500,000.00 to the Ann Arbor Housing Development Corporation to support the sustainability features at 2810 Boardwalk;
RESOLVED, That City Council approve the Grant Agreement Between the City of Ann Arbor and the Ann Arbor Housing Development Corporation;
RESOLVED, That City Council appropriate $162,379.00 from the County Mental Health and Public Safety Millage Fund balance to the FY 2027 Sustainability and Innovations County Mental Health and Public Safety Millage expenditure budget;
RESOLVED, That all amounts herein are without regard to fiscal year;
RESOLVED, That the Mayor and City Clerk are authorized to sign the Grant Agreement after approval by the City Administrator and the City Attorney; and
RESOLVED, That the City Administrator is authorized to take all necessary actions to implement this resolution.