Dearborn City Council Paves Way for Artspace Purchase of City Hall

The Dearborn City Council gave further support for Minnesota-based Artspace to assume ownership of city hall at its meeting on Tuesday.

The council voted 4-1 to approve a zoning variance for artist lofts to be built in the complex's east and west wings, in order to help move Artspace's application forward for a low income housing grant with the Michigan State Housing Development Authority.

Artspace wants to renovate 45 livable apartments in the building’s wings, and add art studio space in the building concourse. The council chambers would be turned into a performance and lecture space.

Last month, the council approved allowing the city to sell city hall, 13615 Michigan Ave. at Schaefer, to Artspace for $1.65 million.

Council President Tom Tafelski voted against Tuesday's zoning variance, and Councilwoman Nancy Hubbard abstained.

"I just want some time to speak to the mayor," Hubbard said after the meeting. "I have a few more questions. If nothing else, my decision to abstain will give people something to talk about."

Council President Pro-Tempore Suzanne Sareini was absent for the vote.

The council also approved the East Dearborn Downtown Development Authority's community revitalization plan and authorized Mayor John B. O'Reilly, Jr. to sign a letter of support for the Artspace project.

O'Reilly said the community revitalization plan includes a summary of projects the city has already approved for the EDDA in recent years, and explains how Artspace's longterm vision fits into Dearborn's economic development.

"By approving the plan, it gives Artspace more points on their grant application to the Michigan State Housing Development Authority," O'Reilly said. 

Artspace is submitting its application for a MSHDA low income housing tax credit on Aug. 15. The nonprofit will learn by November if it will receive the credit. If not, it can apply again in February 2014.

The vote on the study was 5-1, with Tafelski voting no.

Once Artspace receives the tax credit, the targeted closing date on the sale of city hall is June 30, 2014, which is when all city offices must be out of the building. Operations will move to the Dearborn Administrative Center, 16901 Michigan Ave., the former ADP building. The city bought the building for $3.2 million in 2012.

Artspace said it previously plans to spend $17.4 million on renovations of the current city hall building. The MSHDA tax credit can only apply to the building's wings, as that is where apartments will be built. To renovate the building's concorse, O'Reilly said Artspace will seek donations from local sponsors.

One of those sponsors is Severstal North America. The company expressed an interest in providing $1.45 million to develop the concourse and $345,000 on Artspace development costs as part of an $8.3 million buyout of its 2005 profit-sharing agreement with the city after it purchased the Rouge Steel plant. The rest of the money would go toward Dearborn Administrative Center costs.