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Dunes’ New Owner Edges Toward Construction Plan

McClendon to tell township where he thinks development is legal

May 21, 2007 | By Keith Schneider
Great Lakes Bulletin News Service

Mike Shaw

Members of the Saugatuck Dunes Coastal Alliance will attend a meeting where the buyer of two miles of Lake Michigan shoreline will unveil a development outline for his property.

SAUGATUCK—The lawyer for an Oklahoma City-based energy magnate, who last year spent $39.3 million to buy 402 acres of Lake Michigan shoreline at the mouth of the Kalamazoo River, will describe to local officials this week where he and his client believe housing and other developments could be built on the newly purchased, sensitive lakeside parcel.

Stephen Neumer, an attorney for Aubrey McClendon, the founder and chief executive of Chesapeake Energy Corporation and the parcel’s owner, is scheduled to appear on Thursday evening at a meeting of the Saugatuck Township Planning Commission. He will outline where his client believes the law allows development to occur on the parcel, one of the largest stretches of untouched beachfront along the southern Lake Michigan shoreline—and one that is safeguarded by several state environmental laws.

The presentation, at the Douglas Elementary School at 7 p.m., is sure to draw many local residents, including members of a newly formed citizens group, the Saugatuck Dunes Coastal Alliance, which intends to protect the natural geography and rural character of the Saugatuck region.

In an interview, Mr. Neumer said that a formal development proposal showing even an approximate number of new homes and their location on the parcel has not been completed.

"During the May meeting we will show, under the rules of the law, where development could take place and put lines around those places so that people understand what the rules permit," said Mr. Neumer. "This is a step to understand where we can build. We haven’t decided what to build, and where it should go."

Jim Hanson, the chairman of the township planning commission, said the seven-member panel has been evaluating technical and environmental data that Mr. Neumer and JJR, a national landscape architecture and engineering firm, have submitted to local authorities since late last year. Mr. Hanson, who was raised in Chicago and spent 10 years as a technical specialist with Dell Computers in Austin, Tex., said the planning commission’s oversight has taken into account the place the parcel, long known as the Denison property, occupies in the economy and culture of Saugatuck.

"It’s a special place," he said. "Landscape is important here. Culture is important. History is important. The Denison property defines us in a certain way."

The Thursday night planning meeting will be the third time that Mr. Neumer has publicly shared technical data about the Denison property without unveiling a specific development plan. He said that the methodical process reflects his understanding of the sensitivities that surround any discussion in this region about building on the parcel, which spans more than two miles of Lake Michigan beach. Assessments by the state and several environmental organizations found that the stretch of land is among the most biologically productive habitats for rare plants and animals on the Great Lake’s eastern shore.

In a planning commission meeting in February, Mr. Neumer acknowledged that every step he and Mr. McClendon take to develop the Denison parcel is being closely scrutinized.

"Everyone in this county is uniquely interested in what’s going to happen with this property," he said.

A Record Purchase
Spurring the intense scrutiny that any development proposal for the Denison property will receive is the beauty of the place and its meaning to area residents. The land is where Lake Michigan’s clear water, clean sand, and wild dunes meet and form a maritime gateway to Saugatuck and Douglas—two of Michigan’s most beautiful coastal villages. It is also where generations of children learned to swim, people strolled at day’s end, young people married, and families even cast the ashes of their dead to the wind.

Adding to its attraction, the former Denison property is close enough for many nearby residents to reach quickly on foot, on a bike, and by car. Its northern boundary lies along the southern boundary of the 1,000-acre Saugatuck Dunes State Park, which was established in 1982.

Over the years, efforts to conserve the stretch of coast have helped launch political careers and build advocacy organizations. In their Tri-County Comprehensive Plan, for example, Saugatuck, Douglas, and the adjacent township specifically said that preserving the Denison parcel was their first priority, even though it was privately owned. That commitment has gone well beyond words: Local residents mounted their own purchasing bid when the property’s longtime owners finally put it up for sale three years ago. In concert with the City of Saugatuck, the State of Michigan, and two important land conservancies, the citizens helped raised $38 million in 2004 to buy the Denison property for public use.

But their offer was ultimately rejected.

The reason: Mr. McClendon, who, besides being a prominent energy company executive, co-owns the Seattle Supersonics and Seattle Storm basketball teams, offered $1.3 million more that the citizens were able to raise.

Observers say that even if Mr. McClendon’s purchase, completed last July, had not involved such major conservation issues, the price alone—the most ever spent for a large expanse of undeveloped coastal land in the Lake Michigan basin—would have attracted strong public interest. But because it also occupies the place where the Saugatuck coast’s history, culture, the environment, and the economy converge, the sale of the Denison significantly magnified controversy over attention to every aspect of its future use.

Neumer’s Role
Mr. McClendon assigned the job of managing the early steps of his proposed development to Mr. Neumer, an attorney who was raised in Muskegon, practiced law in Chicago for 41 years, and now has settled in a grand Lake Michigan home in nearby Casco Township. Though he’s undertaken his own development projects over the years, including a 60-acre project along the Black River near South Haven, the proposed development on the Denison property would be the largest he has ever been involved in.

Mr. Neumer said he was introduced in 2004 to Mr. McClendon, a client of his Chicago law firm, by a partner who told the Oklahoma City businessman of Mr. Neumer’s expertise in development along the Lake Michigan coast. Mr. McClendon, a member of Oklahoma’s prominent Kerr family, of the former Kerr-McGee Corporation, was familiar with the area. His wife, Katie McClendon, is a member of the Upton family, the founders of the Whirlpool Corporation, in St. Joseph, Mich. The couple met while both were students at Duke University.

"My old partner knew that I was knowledgeable on western Michigan land and knew this parcel well," said Mr. Neumer. "I had looked at it a year before as a possible acquisition by me. I looked at all the issues with the community, the conservation groups, and DEQ, and decided I was a little too old to be the guy that worked things through as an owner. I am his eyes and ears and actor in Michigan."

As a lawyer, Mr. Neumer also knows that citizens opposing any development on the Denison, including members of the Saugatuck Dunes Coastal Alliance, have ample opportunity in state and local land use law to intervene in permitting and other administrative reviews of Mr. McClendon’s development proposal.

Formal biological assessments by the state and conservation groups during the past three decades have reached consistent conclusions about the Denison’s value in providing habitat for rare and endangered plants, birds, and animals. The Denison property also sits near the southern edge of a 2,534-acre zone of critical freshwater dunes that, since 1976, have been protected by the Michigan Sand Dunes and Management Act.

Mr. Neumer said he hopes to ease public concern by methodically disclosing information in public and "inviting a process of open dialogue."

"We are describing the science as we are going along," he said. "We’re uncovering all of the issues in an open and welcome process. I’m not saying the community isn’t fearful about the future. There are a lot of interest groups and the normal fears. The developer is direct and open and honest about them. The process is good and going along in wholesome way."

Keith Schneider, a journalist, is the editor and director of program development at the Michigan Land Use Institute. Reach him at keith@mlui.org

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