PETOSKEY –  Along with its scenic beauty, quiet beaches, and miles of serene forests, this Lake Michigan coastal town has aggressively promoted the collection of historic buildings at its center as an attraction for residents and visitors alike. In 1986, the U.S. Department of the Interior formally recognized Petoskey’s unique 19^th and early 20^th century architecture by naming a generous portion of the downtown a national historic district.

On Tuesday, May 3, voters here will decide whether a $50 million hotel, retail and condominium development that would fill an entire downtown block fits with Petoskey’s historic character. The dueling campaigns in support or opposition to the proposal, by Lake Street Petoskey Associates, have largely sparred over how the project affects jobs, economic development, and quality of life. The battling sides have not discussed whether the project also challenges historic preservation strictures.

The reason: Petoskey’s national historic recognition is mostly honorary, including that extended to the Gaslight Cinema, a turn-of-the-century building that would be demolished by the project. The buildings and character of Petoskey’s Victorian downtown – celebrated in promotional literatures and on signs at entrances to the business district - are not protected by local zoning or a local historic protection law that could set design standards for new construction and restrict changes to existing structures.

“The hope is that people maintain their historic homes and businesses, but we don’t have an ordinance that tells them to do so,” said Candace Fitzsimons, executive director of the nonprofit Little Traverse Historical Society in Petoskey.

Vote A Regional Touchstone

If approved, the project in Petoskey would add a half-million square feet of space downtown, draw tens of thousands of new visitors annually, and significantly boost the local tax base, say authorities. It also would add modern buildings up to 76 feet high adjacent to a historic district with a height limit of just 40 feet.

That contrast doesn’t bother Carlin Smith, the Petoskey Regional Chamber of Commerce’s executive director, who rightly points out that the land in question slopes sharply, with the tallest buildings – including a five-story hotel with penthouse condos on a sixth level – slated for the lowest portion. This, he says, could lessen the project's perceived height and massiveness.

“The criticism of the hotel being too tall and of these being ‘resort condos’ doesn’t fly with me,” said Mr. Smith, sitting in his downtown office. “Tourism and lodging, including very large hotels that once stood here, have been a cornerstone of our economy for 100 years.”

But new Petoskey Mayor Ted Pall, who took office January 1 and campaigned against the project, fears the project’s scale, which required the city to rezone the land to allow for taller buildings, would encourage other developers to come forward with their own large-scale plans that would undo zoning block-by-block in the historic downtown. He points to a passage in a 1996 downtown growth strategy, the most recent commissioned by the city, as evidence that the project would take Petoskey in the wrong direction.

“At all major entrances, the historic nature of downtown should be clearly and highly evident to motorists. Downtown’s historic charm and appeal should be so evident that motorists cannot resist detouring into downtown,” says the study conducted by HyettPalma, Inc., of Alexandria, Virginia. “Any new construction occurring downtown must be compatible with and fit in with downtown’s historic architecture.”

Attractive But Without Teeth

Petoskey’s downtown also is home to the historic Gaslight District, a collection of mostly one- to four-story Victorian buildings dating to the 19^th and early 20^th century, offering the practical – sandwiches and shoes – and the boutique, including art and jewelry. In recent years, Petoskey has been recognized by authors of The 100 Best Small Towns in America, The Great Towns of America, and America's 100 Best Places to Retire.

But, for all of the pride in its heritage, Petoskey is hardly alone in failing to add local teeth to its federal historic designation, according to Diane Tuinstra, who works in the Michigan State Historic Preservation Office, which is housed in the Michigan Department of History, Arts, and Libraries.

“We have all sorts of rules for building and behavior in subdivisions but not in some of the national register districts across Michigan,” Ms. Tuinstra said in an interview.

The national historic listing, however, can at times trigger review and protection under federal laws, namely the National Environmental Policy Act and the National Historic Preservation Act, if the proposed project is using federal funds or certain federal licenses, according to Ms. Tuinstra.

The city had contemplated using federal Community Development Block Grant funds to help buy one level of the project’s parking structure, which spurred a site visit from Ms. Tuinstra. Her conclusion, which she offered in an interview: “The proposed project just towers above the downtown. It’s monstrous. It’s huge. It bears no resemblance to a small Midwestern town.”

But she also concluded that the cinema – which originally housed the historic Temple Theatre – and other nearby buildings had decayed markedly and lost their historic value. Whether the development project would have unreasonably harmed the adjoining historic district wasn’t settled because the city ultimately decided not to use federal money on the site.

The Lake Street project would, however, include a federally licensed bank – Northwestern Bank, which owns about half the land on the square block. The bank has not triggered a review of its potential affect on the adjoining historic district yet, but it still might, after the May 3 vote. If voters approve the project, then the bank would likely have to apply to the state for state-federal historic impact consideration, said Martha McFarlane-Faes, of the Michigan State Historic Preservation Office. Harry Calcutt, President and CEO of Northwestern Bank in Traverse City, did not return a call requesting an interview.

History Revisited

	MLUI
	On Tuesday voters decide whether a $50 million hotel, retail and condominium development that would fill an entire downtown block fits with Petoskey’s historic character.

Royce Yeater, an architect and Midwest director of the National Trust For Historic Preservation, a national non-profit group, said his organization may get more involved in Petoskey if the project is voted down on May 3. Mr. Yeater, who works out of the National Trust’s office in Chicago, said he is interested in amending the Petoskey proposal in a way that invites more public support. “That requires trial and error best done by an experienced architect, where a less-experienced developer might beat his head against the wall for years,” he said.

It’s unclear what the Lake Street Petoskey developers, who would not comment for this article, will do if they lose the Tuesday vote. The company owns the defunct Gaslight Cinema, which they initially proposed converting to retail businesses with condominiums on top, before their idea swelled to include the entire block. The National Trust, however, said they’d be prepared to chart a new vision with the developers and the community.

“This is an issue that our Main Street program does a lot,” said Mr. Yeater, referring to his group’s downtown revitalization and preservation program, which works in some 1,800 U.S. communities, five in Michigan. “Where we have a Main Street program, it’s not uncommon for a city to reach out to us for involvement in the process with our architects and staff. We’d be glad to assist Petoskey.”

-----------------------------------------------------------------------------

WHAT HAPPENED

Voters Approve New Development

PETOSKEY, May 4, 2005 – In an apparent end to a searing community debate, Petoskey voters on Tuesday approved a $50 million development at the entrance to the historic downtown overlooking Lake Michigan’s Little Traverse Bay. By an unofficial margin of 1,144 to 934, voters upheld the city’s December approval of the project, which includes a hotel, conference center, condominiums, a restaurant, retail space, a bank, and a public-private parking structure. Supporters pointed to the project’s promise of increasing tax base, parking space, and people in the downtown. Opponents feared the scale, adjacent to the downtown’s national historic register district, and chafed at how the out-going city council approved the project late last year.

Kelly Thayer is a journalist and transportation analyst at the Michigan Land Use Institute. Reach him at kelly@mlui.org.