Brownfield authority OKs Rylees project

June 15, 2012
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The Grand Rapids Brownfield Redevelopment Authority approved a plan last week that would allow Rylee’s Ace Hardware to turn a highly contaminated former gas station on the city’s west side into its third store in Kent County and fourth overall.

Rylee’s would perform remediation work on a vacated site at 1205 W. Fulton St., a block east of John Ball Park, and on an adjacent parcel at 21 Garfield Ave. NW. The family-owned business wants to invest $1.1 million into the project and build a two-story, 10,000-square-foot store on the gas station site and create 10 new full-time jobs from that investment.

“Our thought was, let’s clean it all up,” said Matthew Jamrog of Rylee’s, which has been working on the project for 13 months. “We have over $10,000 in this already and we haven’t even stepped onto the property.”

The owners of the Clark gas station fell behind on the site’s property taxes, and Kent County foreclosed on the parcel in April. The Kent County Land Bank Authority has offered to buy the site from the county for the taxes owed on it and then sell it to Rylee’s for the unpaid tax amount. At one time, the Fulton site was on the market for $80,000, but the property’s last tax payment was made in 2010 and was for the 2007 tax year. The gas station has been closed for about five years.

The city’s Planning Commission and Board of Zoning Appeals have to approve the project’s site plan and the city commission has to add the project to its brownfield list before Rylee’s can begin working on the site. Commissioners have a public hearing on the project set for July 10.

The property contains four underground 10,000-gallon storage tanks that have leaked a reported nine toxic chemicals into the soil. “It’s one of the worst in the state,” said Kara Wood, GRBA executive director and city economic development director, of the level of contamination on the two adjacent properties.

Rylee’s is also buying the house on Garfield. The owner hasn’t been able to sell it due to the property’s contaminated condition. Rylee’s will raze the home and use the parcel for customer parking.

“We’re going to war with Home Depot with this site,” said Jamrog, who added his store will focus on offering customers a convenient shopping environment with prices that can compete with the big-box store.

The cost to clean up the property has been estimated at nearly $400,000. Rylee’s has to remove the station’s tanks and contaminated soil, demolish the existing structure and make public improvements to the property.

In addition to approving the brownfield plan, GRBRA also agreed to loan Rylee’s up to $250,000 from the city’s revolving loan fund to help with the clean-up. The fund is financed by a grant awarded to the city by the U.S. Environmental Protection Agency for such projects. However, the EPA requires collateral for each loan issued, so GRBRA is pledging revenue from its local revolving loan fund as security. The authority predicts it will have nearly $2.2 million in its fund over the next 10 years.

“The clean-up costs will be paid through the EPA revolving loan fund and tax-increment financing,” said Wood.

Wood also said the brownfield authority will have to repay the loan if there isn’t enough tax-increment financing available, but she added the EPA may forgive the loan if it isn’t repaid.

Voting on Rylee’s request had been tabled for a week to give city commissioner and GRBRA board member Walt Gutowski time to discuss the project with the owners of Nawara Brothers Home Store, a longstanding hardware and appliance store at 1030 W. Fulton, two blocks east of Rylee’s proposed site. Gutowski said he didn’t know about the project ahead of time and felt the way it was reported in the media was unfair to Nawara Brothers. He said the neighbors were upset, so he asked for the vote to be tabled. He since has spoken with Nawara representatives and said everything is fine.

“I hope that Rylee’s and Nawara’s can work together to support the neighborhood,” said Gutowski, who represents the area with Dave Schaffer on the city commission.

Jamrog said Nawara Brothers and the West Fulton Business Association support the project, which he added wouldn’t be going forward without the land bank and GRBRA being involved in it.

“I think you’ll see more of this in the future. I don’t think we’ve begun to tap into its potential,” said Wood of the land bank.

“We intend to be involved in economic development throughout the county,” said Dave Allen, the land bank’s executive director.

Rylee’s, which has been in business since 1946, hopes to begin construction in September and open the store next spring. The retailer has stores on Michigan Street NE in Grand Rapids, on Remembrance Road NW in Walker and in Allegan.

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