A fight over development in Shiloh, a new pact with the chamber and new terms for a major Block project in a packed Council meeting
Above: Council member Gordon Smith. File photo by Max Cooper.
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Every year that there’s an Asheville City Council election, there’s usually at least one meeting before the new Council members take office.
Often, this meeting isn’t particularly action-packed. Though there are some exceptions, it usually has some items of moderate note with perhaps one actual controversy occasionally thrown in for good measure.
This year, however, is following a different pattern in the weeks before three new Council members — Keith Young, Brian Haynes and Julie Mayfield — take their spots on the dais and three others — Marc Hunt, Jan Davis and Chris Pelly — depart. There are two meetings, back to back in successive weeks, before the Thanksgiving holiday. Both have plenty on the agenda to talk — and argue — about. The first, on Nov. 10, saw Council make three relatively major decisions, with at least some dissent in every case.
The meeting also showed that some on Council may be revisiting their positions in the wake of the election results a week before — interpreted by many as a rebuke to some of the current majority’s policies.
Stick to the plan
The first major item was a proposal to build a storage facility on Hendersonville Road, on a strip of highway bordering the Shiloh community. The developers requested a rezoning to allow the the three-story facility, with 700 storage units, to proceed.
But there was a catch. By the time a development (or, technically, the rezoning necessary to build it) reaches Council it usually does so with the blessing of the city’s planning staff — though sometimes they’ll recommend that a few changes be tacked on — and approval from the Planning and Zoning Commission.
Not this time. The planning commission had unanimously recommended that Council kick the project straight out. That’s what staff felt too. The residents of historically African-American Shiloh had crafted their own plan for development in the area, and city planner Vaidila Satvika asserted that a building like this had no place in it.
“The size and scale of the project are not compatible with the adjacent residential neighborhood,” he hold Council. “It [the plan] recommends the city allow no additional commercial incursion into the community.”
During the campaign, the issue of the level of attention the city paid toward African-American neighborhoods — both their infrastructure needs and how seriously it took their neighborhood plans — became a topic of discussion, and it was one of the questions the Blade asked each of the candidates.
According to Satvika, the city needed to respect the Shiloh plan and reject the storage facility.
“Yes, this project could be worse, but it could be better too,” Satvika said. “We should hold a higher standard and encourage this type of rezoning to meet other city goals by incorporating housing and neighborhood scale retail to take advantage of nearby transit stops at a scale that fits. We should not rezone property to meet the lowest common denominator.”
But not so fast, representatives of developer Walter Taylor (who has built similar facilities in other states) claimed .
“This is not one of your old, typical self-storage facilities,” former mayor and attorney Louis Bissette said, citing that from the outside the structure looked like an office building and that the units were accessed from inside the building.
Bissette and other representatives of the developer claimed the project had received a good reception at community meetings and even a letters of support from the immediate neighbors.
“At every meeting we left with people saying ‘gosh, this is a pretty good project,’” he said. “They see what can be on there and they see what this project does. I think maybe you’ll find out tonight that a lot of those people think this is a pretty good project.”
They told Council that in addition to the storage facility not being as intrusive as staff were making it out to be, a fast food restaurant or a gas station could go there under the current zoning without ever going before Council. In short, they asserted, Council should support this or the city would get something worse.
“I want you to think about, during that presentation, that the property is going to be sold,” Bissette said. “It’s zoned highway business. There’s a nice Hess station right up the street, there’s a lot of convenience stores that could right on that corner property without any permit you would ever hear about. It would be a matter of right. Really, you need to keep that in mind.”
David Elliston noted the developer had 10 such storage facilities throughout the southeast, and they were “first-class.”
“We actually intended to have wine storage at this facility,” Elliston said. “It is something that I think will benefit the community.”
He added that while the developers had initially been unaware of the Shiloh community, they’d made every effort to reach out.
Despite the picture Bissette painted of a welcoming community, multiple leaders from Shiloh said they strongly opposed the plan.
“We are in the middle, nowhere to go, if the commercial business continues to encroach into Shiloh we will not exist,” Norma Baynes, the liaison for the Shiloh Community Association, said, fearing that their neighborhood could disappear in the face of those pressures like other American neighborhoods in Asheville have.
While they’d heard the developer out, the Shiloh Association’s board had voted 6-3 to oppose the project, and they’d done so, Baynes said, because the development “is not acceptable” and ran counter to their carefully-developed plan.
“To destroy Shiloh is to destroy Asheville’s history,” she continued. “We believe that the City Council that adopted our 2025 plan on Sept. 14, 2010 embraced our vision.”
Shiloh resident Bennie Norman-Macintosh also criticized the developer’s proposal, asserting that “most of the neighborhood I have spoken with do not support this plan” and that the high-end storage units would be out of the price range of most of the locals nearby. She claimed that some locals felt obligated to current property owner Charles Owen to support the project, but that the majority of the community did not feel that way.
“You don’t see all these buildings going up in Montford,” she told Council. “Put something in our neighborhood that’s going to benefit us. If it benefits someone else, put it in their neighborhood.”
“Just because you worked for someone doesn’t mean you owe them a thing.” she added. “I am really upset for them walking all over our plan like our plan doesn’t exist. They’re just coming in and saying ‘we’re going to do it.’”
Not every Shiloh resident agreed with the opponents, with some voicing support for the project.
“The project gained the support of the community,” Faye Reynolds, the Shiloh association’s financial secretary, claimed. “This project is beneficial for the community and can be supported for the 2015 plan.”
She noted that she had been one of the residents who cited her family working for Owens in the past. Adam Stone said the developer had asked for more input than others, and the community needed to accept “the truth that this is piece of property will get developed, it’s just a matter of how.”
But despite the split reaction, with the leadership of the main community organization, city staff and the planning commission all in opposition, other developers and the property owner came up to try and turn the tide.
“I don’t know any of these people,” Charles Owen, current co-owner of the property, asserted of some of the project’s supporters. “I should not be held accountable or talked badly about because some people worked for my family. Most of those people worked for my family over 30 years ago. None of them currently work for me today.”
“We have made a clear choice not to put another gas station, convenience store or drive-through establishment,” he added, emphasizing those where all things they could have done without going before Council. In doing so, Owens claimed, they were actually respecting the neighborhood’s plans and had been welcomed by many residents.
Developer Walter Taylor claimed that city staff had initially warmly received the project, that they’d tried to address concerns and that he was “here to express my confusion at a lot of frustration” at the shift in reactions.
Joe Brumit, Owens’ partner on the deal, told Council that “I know the impact a drive-through restaurant can have on this property” because “I own about 47 of them.”
But despite those arguments Council, overall, proved unpersuaded.
“We’re to make a decision on the proposal that’s before us, not on the imagined futures of what might come before us if certain things might happen,” Council member Gordon Smith said. “When things come before us here we need to try to get the best we can for our community instead of trying to avoid the worst. I think the Shiloh neighborhood plan does matter and we need to pay attention to it.”
That plan, Pelly noted, “took several years and a lot of hard work” from Shiloh residents, and “I too am concerned that this clearly violates some of the tenets of that plan.”
There were, however, exceptions. Hunt said he was “caught between these different approaches” and shared the worry that some of the alternatives the developers mentioned could be worse than what they were proposing.
He asked Planning Director Todd Okolichany if staff had evaluated that. Okolichany replied that staff couldn’t evaluate projects that hadn’t been proposed, but estimated that some smaller buildings that could be built there might actually have less impact than what Taylor and his colleagues were proposing.
“You’re assuming this is a worst-case scenario, but we’re being presented with another worst-case scenario,” Davis said in reply to Okolichany’s assessment. “I suspect that’s one we probably better be looking at, because it is going to sell.”
Council ended up voting 5-2 to reject the development, with Hunt and Davis against.
Inking the deal
Next was a renewal of the cooperation deal between the Economic Development Coalition, run by the Chamber of Commerce, and the city, specifically $100,000 in aid from the city coffers.
That amount is an increase over what the city’s given in previous years. Back in July, when Council approved their annual budget, only a narrow majority approved the $40,000 hike in the funds the EDC was set to receive. Critics took issue with the increase in light of the chamber failing to back the city in a recent fight over an increased hotel tax. City leaders had hoped to see an increase go to public funds, but in the end it went to the Tourism and Development Authority to fund more marketing.
The remnants of that controversy, and a new one, loomed over the discussion of the new terms between the city and the EDC.
The coalition’s director, Ben Teague, asserted that the group plays a key role in bringing business to Asheville and that its recently-revised five-year plan (known as the 5×5 plan) focused on bringing high-paying jobs to the city.
“Five years ago Asheville was in a very different place,” Teague said. During the five years of the EDC’s previous plan, investment in Asheville had boomed, he claimed, going from around $35 million a year to more than $200 million a year. “Those are significant numbers for our community.”
The EDC, he asserted, had played a role both in encouraging the expansion of local business and in high-profile deals like bringing New Belgium brewing and auto parts manufacturer Linamar to town. In total, he said, it played a role in the creation of 6,000 jobs.
But the plan needed “to evolve, just like our community has over the past five years.” Not, Teague noted, it focuses on “smarter jobs, more skilled jobs and we want those jobs to have an average wage of $50,000 a year and above” as well as “innovation” in the form of trying to attract 50 “high-growth” companies while still focusing on getting more investment into the area.
Smith, who’d objected to the increased EDC funding back in July, still praised the group for “outstanding work” that he claimed contributed to the area’s low unemployment. But he asked about the removal of the arts as a major focus from the EDC’s new plans.
Teague replied that the EDC had focused its arts efforts on aid to events like Moogfest (which lost money and, earlier this year, announced it was leaving the area) but had struggled to find a way to attract investment and work with the arts the way it did with manufacturing or more traditional companies. In the end, he noted that while the EDC might have some staff time devoted to the arts, it was encouraging the arts community to “partner more broadly.”
Smith replied that he believed the community placed a great value on the arts and hoped the EDC would as well, especially in partnerships going forward.
He also alluded to concerns about “chain stores moving into downtown, values going up, pushing out our independent businesses” and wondered if the EDC had any plans to address that.
“We try to help them to get the resources they want,” Teague said, including in connecting local business owners with other organizations. “Absolutely we’ll help those entrepreneurs downtown.”
“It’s happening fast,” Smith said. “I think it’s up to us to either respond quickly or watch things change in a way that might not be something the broader community wants to see.”
“If downtown stops, the entire area stops,” Teague noted.
Smith then said he was “torn on this tonight,” praising the EDC’s work on one hand but adding that he had concerns as well.
Hunt, who’s been Council’s liaison with the EDC, said he found himself “regretting I haven’t taken more time to inform Council about my experience there and really my take on the role of the EDC.”
That take was strongly supportive, and Hunt said he agreed with the changes to the status of the arts in the group’s planning, saying that the city would be a more appropriate vehicle to fund the arts as “the EDC focuses on capital and high-paying jobs.”
“It’s been said that ‘well gee, New Belgium would have come here anyway’ or ‘GE Capital would have come here anyway’ or ‘Linamar would have done what it did anyway,’” Hunt said. “That is absolutely not true. This is really one of the better economic development initiatives in a city of this size in the country.”
Cooperation between the EDC, city and Buncombe County government he claimed, played a major role in economic success and $100,000 he believed, was a small price to pay.
“I know this election there was a lot of concern about growth in general and capitalism in general,” Hunt continued. “But this initiative is very focused on high-paying jobs. It’s not about hotels, it’s not about the hospitality and retail industry, which do have underpaying jobs.”
“I think it will come as no surprise to anyone who follows Council that I take a rather different view,” Council member Cecil Bothwell replied. “I don’t mean to denigrate your work, there is good work done by the EDC, no doubt. But I think it often appears that a concerted effort like your plan gets credit for things that would have happened otherwise.”
Specifically, he asserted that many of the group’s supposed successes were due to factors well outside their control.
“New Belgium came here because of water and the highways,” he continued. “They considered other places that had the same amount of highway access, but it’s a worker-owned cooperative and the workers wanted to be in Asheville, not to be in Philadelphia. Linamar came in because of an empty Volvo plant. Their main customer is Volvo.”
He claimed the election should have sent a message to Council that the “people in this city have had growth up to here, they don’t want to incentivize more and more growth when the growth seems to be leaping ahead of our ability to cope with it.” He remained opposed to $100,000 for the EDC.
“Thanks Ben, for standing here during all that,” Mayor Esther Manheimer said as Bothwell finished his remarks.
Kitty Love, director of the Asheville Area Arts Council, said that many artists and local businesses had concerns about the EDC dropping the arts from its list of major priorities.
“It’s about where resources are directed,” she said, adding that while she understood the EDC’s concerns that return on investment in the arts was difficult to measure, finding a way to do so was necessary in a city like Asheville. “Whether or not it’s the chamber or the EDC that provide the opportunity for this to uplift and provide for arts and culture, some provision must be made. These may not be high-growth small businesses, but they’re very meaningful small businesses in many ways.”
While Smith had previously opposed the increased funds to the EDC and said concerns remained, he added that “at this point I don’t feel like we need to use this as a whipping stick.” He did, however, said he wanted to see the arts and culture issues addressed in some way.
“This is funding to grow quality jobs in Asheville,” Manheimer said. “This is not to grow the hotel industry, they don’t receive any incentives as part of this plan.”
She added that she regarded the electorate’s apparent concerns about growth as a separate issue from backing the EDC. “We need to be at the table and do our part. It’s been effective; we have the lowest unemployment rate in the state. But we’re still challenged by the growth of jobs being more in the lower-paying range.”
On a 6-1 vote, with Bothwell against, the city agreed to the $100,000 pact with the EDC.
A slab and a hard place
The next matter Council tackled proved thornier even, perhaps, than those that proceeded it.
In its attempts to grow affordable housing, Council’s often partnered with outside non-profits. One of the main heavy-hitters on that front is Mountain Housing Opportunities, which has built and runs about 600 affordable units throughout WNC.
The Block, a historically thriving black business and residential neighborhood, was hard hit by redlining, urban renewal and racist government policies and much of it was left out of downtown’s revival. In 2013, partnering with the Eagle Market Streets Development Corporation, MHO secured funds from the city and went forward with Eagle Market Place, with an intent to have 62 affordable units along with business and community space while incorporating several historic buildings.
But the area’s poor soils posed a significant challenge, and earlier this year, a major concrete slab broke, bringing a halt to construction.
Now, MHO leaders asserted, that left the whole endeavor in a tight spot. To continue the project, they came before Council seeking revised terms to their loan in an effort to secure financing to finish the project.
Those terms meant turning 24 to 30 of the units from affordable housing priced at an average of $569 a month to more expensive and controversial “workforce” housing priced around $1200-1400 a month. It also meant a eliminating the interest due on their city loans (something the city has generally done for projects serving the lowest income households) and the city agreeing to loan $2.8 million it had already committed early, when the project was half-finished (it’s 20 percent completed now) rather than completed and changing when it transferred another $218,000 already committed to the project.
While the engineering company had admitted its fault in failing to design, attorney Wyatt Stevens said, its insurance only covered $500,000 and they estimated $4 million needed to finish the project. While MHO and its co-developer might eventually get much of that back in court, in the meantime the project was stalled without new funds.
“The design was so bad that on the first floor, the second floor and part of the foundation, the columns that support that will have to be replaced,” he told Council. “For the last six months we’ve been trying to figure out where we go from here.”
“The question is: where is that $4 million going to come from?” he continued. To get that cash, he continued, they needed to make more money from the apartments and better terms on their deal with the city, especially in order to get a $3 million loan to cover the lion’s share of the cost.
“You would still have 32 of those units deeply affordable,” he said, and as for the “workforce” units, “those are still affordable units to people who make an average area median income in the city of Asheville. That’s folks who live in our community, people like Ben Teague was talking about earlier.”
Combined with what the design firm had already paid, the loan, the reduced interest and receiving more of the city funds earlier Stevens asserted the project could make up the gap and see its way to completion.
“We’re not asking for any new money from the city, this proposal has a lot of conditions attached to it,” Stevens said, including that the project must obtain the loan funding it was seeking. “This is a community project, it’s a project that can be and will be completed, but we’re going to need everyone’s help.”
MHO Executive Director Scott Dedman emphasized that most of the units would remain “deeply affordable” and added that if it gets enough funds back for the damages, it might lower rents.
“Obviously to us, as to you, fewer workforce and more deeply affordable units is desirable,” he said. “That will be our goal.”
Assistant City Manager Cathy Ball noted that the city would also specify that Eagle Market Place must be completed and start leasing units no later than January 2017, in addition to inspections to verify the project’s progress.
“I don’t see that we can afford not to complete this project at this point,” Bothwell said, moving to approve the new conditions for the project. “I can’t see not doing this.”
David Nutter, secretary of the Eagle Market Place Development Corporation board, called on Council to pass the deal. He noted that due to everything from poor soil to the impact of urban renewal to the difficulty of finding the right developer, it had taken a long time to get to this point and were now “terrified” that they might not reach their long-sought goal of seeing revitalization in the area.
“The problems run on in a perfect storm: thank you for sticking with us,” he said. “The goal is to preserve a living Block with an African-American presence on this hallowed ground.”
These efforts, he believed, had helped spur other development like planned apartments and the coming Foundry Inn hotel, “which will remember the Block in its interior.”
“The 62 affordable units is the silver living that could possibly be pulled out of this,” Rich Lee, recent Council candidate, told Council. “If there’s any way by extra assistance from the city or by a condition that makes returning those units to the affordable rate a condition of getting that settlement [ I would urge that would do it. That’s the one thing we can’t get back out of this, to return those rents to a rate that’s truly affordable downtown.”
“I understand the gravity of what’s going on, I’m a very pragmatic person: we can’t let the project fail,” Dee Williams, who started her business career on the Block, said. “I would just ask that some space be found for entrepreneurs of color. That’s what’s missing. I drove through the Block purposefully before I came here and I saw some people sitting on buckets and no businesses owned or occupied by people that looked like me in a traditional African-American district.”
Gene Ellison, former Council member and property owner on the Block, said the area’s fortunes had seen no shortage of ups and downs over the years, and it was important to see this project through.
“We have been through more plans, more designs, a community divided, forget the racial divide, divided over what to do with the Block and the role the Block would play in our great city,” Ellison said. “There’s no blame, no shame in the honest mistakes that have been made.”
While large companies had funds set aside to deal with such issues, he noted that a nonprofit like MHO needed the support of its partners to get through such trials. In the future he said, people needed to look back and say “we all worked together, we all finished the job.”
But resident Justine Reese raised a concern about the loss of affordable units.
“If the intention of this project was initially to create 62 units for 62 families who can not afford to live in this town, why are we deviating from that? Why is that negotiable?” Reese asked Council. “I just want us to ask: is there another way? Can we find another solution besides harming the poor, who desperately need our help.”
“That’s a good question,” Manheimer noted and asked, for the public’s information, for more clarification about that issue.
Dedman replied that MHO’s first priority was not to ask the city for more funds and that some leaders felt a mix of workforce and affordable housing is actually preferable. But ‘we have over 600 apartments in this community and they’re all deeply affordable, not ‘workforce.’ We’ve never done a mix like this.”
However, to borrow the $3 million to complete the project he asserted that it was necessary to have the increased cash flow of the higher rents. Dedman added that if MHO received significant funds back in the settlement process it would turn those fund towards making those units affordable “to the extent possible.”
Manheimer noted that the city’s contribution to the project was already around $5 million and that throwing in another $3 million for 30 affordable untis would be unusual and take funds away from projects the city needed to support elsewhere.
Smith noted that while housing was an important part, the city was also willing to put in the funds it did because of the business and community space the project would provide, as well as playing a role in protecting the historic neighborhood.
“This was funded as a transformational project, not simply as a housing project,” he said. “The housing is a huge, important piece. I’m one of the biggest champions, on Council, for affordable housing. When that slab broke it broke my heart because I knew it meant we weren’t going to get the units. I’m glad this thing is going forward at all. I think 20 years from now people are going to look back at this night and this decision and applaud the wisdom and the courage of Council to move forward on this.”
Not everyone agreed. Wisler said she couldn’t except such drastic changes to the terms.
“I’d really like to see this project go forward, I’m really sad about the construction problems,” she said. But “to pay these monies before the project is 100 percent complete is highly risky.”
“I’m uncomfortable with the reduction in affordable housing units,” Wisler continued. “When the city first committed to this project the cost of [each of these 62 deeply affordable units was approximately $83,000 while the city normally spends less than $20,000 when we contribute to afffordable housing projects. We were already spending quite a bit more for the Eagle Market street project and that commitment reflected how important and transformational this project is for the city.”
But with the changes the city was looking at a total of $135-175,000 per affordable housing unit and Wisler thought that a step too far.
“I would like to see the city fulfill its original terms and original commitment,” Wisler said. “So I will not be able to support this.”
The new terms of the Eagle Market Place deal passed 6-1, with Wisler against.
Wind-up
The meeting was one of two in back-to-back weeks, each with major items (the Blade will have a report on the Nov. 17 meeting on Sunday). But while the three new Council members hadn’t taken their seats yet, the end of the Nov. 11 meeting did give a sign of how much the election the week before had started to change city policy.
In 2010 Council adopted new development rules for downtown, intended to make it so only the largest projects came before Council for review. The intent was to make a clearer process for development, especially for denser housing, but from its inception the measures had critics who asserted that it made the process less transparent. In the last election particularly many targeted the change as allowing the huge growth in the number of hotels going up with out Council review or input.
But Smith announced that after going over the Downtown Master Plan that those changes emerged from, he found that the city should have reviewed the changes after four years.
“I think we’ve hit our timeframe and I think we’re seeing the kind of projects that are occurring and I think it’s time to review these downtown development review guidelines,” Smith said.
“Yes, I would agree with that,” Manheimer said. “This particular item — about what projects come up for review before Council — is certainly something we need to look at now.”