City: Let MG&E Decide How We Develop In the East Wash Corridor?

Posted February 7th, 2017 @ 7:02 AM by

I never thought our city government would hand over decision making to a corporation. Should MG&E get to decide if we expand Burr Jones Field or the the bus barn or decide to build a central police station between Blair and the 1st Street? Should they get the right of first refusal on any land banked lands in the area? Apparently the city is getting ready to give them that power, which may even include vetoing other city projects like affordable housing or a homeless shelter. The resolution may even exclude non-profits not pre-approved by MG&E from getting city approvals in the area.

Here’s the resolution.

The area covered is this:
“For the purpose of this MOU, the Capitol East District is defined by the following boundaries: Blair Street, First Street, Dayton Street, and Wilson Street/Capitol City Trail.

What can’t the city do:

The Madison Water Utility, Madison Metro, and Madison Parks will continue to maintain and invest in their facilities within the Capitol East District, including expansion of Central Park. It is the City’s intent to relocate the Fire Maintenance Facility and Fleet Services to a location outside of the Capitol East District. The Madison Parking Utility may construct future public parking structures within the Capitol East District, the City may construct Madison Public Market District facilities, and the City may renovate the Madison Metro Transit Facility (minor expansion is possible). The City will not plan other new City uses within the Capitol East District without consulting MGE. The City will take actions that will continue to encourage private, taxable development within the Capitol East District.

When they talk about “taxable development” it sounds like they are intending to exclude non-profits as well.

To build a parking ramp.

More specifically, to get land to build the parking ramp.

At the Board of Estimates on January 23rd (start about 55 minutes in), Matt Mikolajewski, the Economic Development Director explains. American Family and Gebhardt are developing the Spark/Cosmos project on the 800 S. Block of E. Washington Ave. Part of the project is for the Parking Utility to build a parking structure on property owned by Madison Gas and Electric at Livingston and Main. When the development agreement was approved, there were more actions that needed to be taken before they could go on with the development. This resolution asks them to approve the purchase of the property and the second is to authorize a Memorandum of Understanding about future municipal uses in the Capital East District. During the negotiations with MG&E they were very interested in making the parking ramp project work, they really want reinvestment in the area. The sale of the land will mean they have to give up land for storage and find a place to replace that storage and that will be a significant impact on their operations. As they are ramping down their uses in the district they asked that the city not ramp up future city uses in the same neighborhood at the same time. They recognize that the Water Utility will continue to operate in the area, Madison Metro will continue to work in this location and possibly expand or reinvest in its property over time. (resolution says only “minor” expansion is possible) but through the MOU regarding future municipal uses, if the city is interested in adding a completely new use in the Capitol District that the city approach MG&E first and have a conversation about whether or not both parties think that is the best use for that part of the city in the future.

Mike Verveer asked about the “veto power” MG&E has over the uses of the land in the Capital East District. Mikolajewski says that the MOU (Memorandum of Understanding) says that the city needs to approach MG&E and have a conversation if there is a new municipal use. They would have some say in that regard. There are some important exceptions, we will continue to have Metro, the Water Utility, we may have a public market. It recognizes that it doesn’t impact street, sewer and water mains or telecommunications. And also if its in the interests of health, safety or general welfare that would overrule the MOU. It’s not set in stone that MF&E could say yes or no, its really the thought behind it that they would like to have a conversation with us, but if for the health, safety and welfare of the public, the city needed to do something in the district we have the right to waive the MOU language.

Alder David Ahrens asks what MG&E has in mind in wanting to restrict municipal uses. Mikolajewski says that their concern is basically right now they have owned the property for decades, its a great location, they can store lots of materials there and its how they have operated for a long time. They are concerned they are partnering to make this happen and are shifting their operations and what they don’t want to see is that they want a new economic development office there. Ahrens interrupts and asks about affordable housing. Mikolajewski says that he doesn’t think that would be considered, but Ahrens reads the language that “he City will take actions that will continue to encourage private, taxable development within the Capitol East District.” Mikolajewski says that most affordable housing is taxable. Ahrens asks if a nonprofit is sponsoring it, we invest in it, and its a non-profit so non-taxable, do they get to veto it. Mikolawjewski hesitates and says he doesn’t know that that would be a municipal use. Ahrens says irregardless of the municipal use, what about the language that says that will encourage “thus” and not “this”. Long pause. Mikolajewski says that this is not a municipal use. Ahrens says we should take a look at that, its a big area. Mikolajewski says “we can look into that”. Ahrens asks “what else do you think they would like to avoid?” Mikolawjewski says that if the city needed new office space or a brand new use that is not there now. Ahrens asks if the county can put a jail in there? Mikolajewski says this only applies to the city, and if the city wanted to put a jail in there, that would be a concern. Ahrens asks if the city participated in the funding of a jail that the county ran, would that be a concern? Yes, those are the types of uses that would cause concern.

. . . of course, I’m thinking, what about Salvation Army expanding their homeless shelter, or the day resource center needing to move or expand? There is a huge amount of parking there that could be used differently, could MG&E veto that? What if Port St. Vincent or the Rainbow Project wants to expand with city dollars . . .

Marsha Rummel says she had the same concerns about MG&E vetoing projects and she called Matt and when you think about our adopted plans for the area is to increase the employment area, grow the tax base and grow jobs and they don’t want us to do what they do already, which is not pay taxes in the area, which is what they do, they don’t pay. The goal is not to put more city services there and there has been many plans in the area. She says that they have been talking about making this a lively place, that main street will become the downtown and the parking structure is part of the lever and the linchpin for all other developments to come. The city has to do their due diligence and protect their interests, but if it didn’t happen we wouldn’t have American Family in the room. For many years MG&E would not sell any land to us or developers. MG&E has been part of the business community discussions for years and MG&E is trying to be a good player in this corridor.

They discussed a few other things such as environmental concerns and the environmental assessment. There is contamination that will require remediation. The parking structure will cap the contamination. Soil removed from the site will need to go to the landfill, but they need to do testing on the top 2 feet of soil for PCBs upon recommendation of the city engineer – if they are found the soil will not be able to go to the local landfill. They are also testing the groundwater. If the costs exceed $500,000 then they can back out of the deal. MG&E is also paying $85,000 to remove soil from the site for the parking ramp. Federal funds don’t seem to be an option. MG&E also retains the right to install charging stations in the ramp. They may change the language in this area. Ahrens asks why this was done after we got the environmental study that talks about benzines, arsenic and other chemicals all above the threshold level and wonders how they arrived at $500,000. He also asks why the studies are not part of the legistar file. They say they will put them in there. (and they are there now) Ahrens has many other questions about the environmental testing that you might want to watch around the 1:15 mark. The mayor tries to cut Ahrens off at some point. Rummel says that these environmental concerns are throughout the isthmus because of the rail corridor and industrial uses. Ahrens remains concerns about remediation costs and what they might find on that site.

I just don’t get it. Why would we let a huge corporation that doesn’t pay taxes have decision making power or influence over what the city decides to do in such a huge area of the city? I might be willing to think about just the south side of East Washington to Paterson or Ingersoll, but I feel like even that is a stretch but they could at least argue that impacts their operations in some way. But do they get to have a huge impact on decisions on what happens as far out as First St?

The council is deciding this tonight . . . ask your alder what they think of this. Or email

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