Story of Campus Inn... EDITOR'S NOTE: This article was researched and written -hy eight University graduate students-.Jana itommersbach, Linda Busby, Bruce Curie, Nellie Dixon, Susan Holtzer, Karl Mnttnla, Tnm Seymnnr and Terrell York. Mark Dillen, a Daily night editor, assisted in the article's preparation. I THOSE FAMILIAR with the rapid growth of the Ann Ar- bor area in recent years, the name John Stegeman evokes thoughts of wealth and power. And with good reason. More than any other individual, John Stegeman has been involved in the expansion of Ann Arbor's buildings and capital in the past 15 years, Today, you cannot drive across town without passing his Charter Realty apartment buildings and properties, office buildings anl hotels. They give every sig:s of a prosperous and diverse enter- prise, an impressive test-atent to one man's efforts. Yet, despite his wealth and power, all is not well for Stege- man. He is plagued by law suits totalling over $4.5 million, sever- al local religious leaders are an- gry with him and some local Democrats would like to find P. convenient way of putting him out of operation. This is at least partially due to the project which was to be his crowning achieve- ment: Campus Inn. This hotel, whose white ex- terior is set off by a row of Big Ten pennants, corns co'mplete with bar and cocktail lounge. From its plush, r'd-carpeted lobby, visitors can sip liquor and look across the street at the First United Methodist Churc. The Grace Bible and Fir..t Baptict Churches are nearby and, -itht next door-like a .rey relic from another age-is v building used by the University School of Music. The story of Campus Inc. began in 1965, when Stegeman gave up an attempt to expand the pro- fitable Bell Tower Hotel, and turned his sights to the location on Huron and State Sts. By 1967, the Campus Inn Corp. -- con- taining relatives and his lawyer but based only on Stegeman's money - had acquired several lots to form an L-shap'xI parcel whose total value, based on the assessed valuation, was at least $100,000. loading of guests and luggage, although this same requirement had been waived for Ann Arbo:"'s Sheraton Inn. DBSE issued a stop-work order on th-3 Campus Inn. WHAT STEGEMEN NEEDED, and got, was a waiver by the city Zoning Board of Appeals. The Board, confronted with an accomplished fact, apparently ce- cided enforcing setback require- ments would be impractical. But in addition to blodoing too far forward, Stegeman was dis- covered to be building too far west. In fact, his deiveway and entrance canopy wsre three feet onto the adjoining property be- then-councilman Nicholas I1azar- inoff and Mayor Robert Harris, Stegeman assured the commis- sion he did not intend to apply for a liquor licen e. Church officials remained e^,n cerned; they say now they nid not trust Stegeman. As Stegeman was making pro- mises back home, he was also working in Lansiig for a chage in the proximity law. On Feb. 10, 1969 lie wrote to the city administrator requesting consideration for Ann Arbor's sole available liqior license. "... there is a movement under- way," he wrote, "to gain differ- ent treatment for conference- the Council three days after Mil- liken signed the bill into lawv, Stegeman's attorney, Henry T. Conlin, did just that. "This beautiful new hotel has been almost completed," Conin wrote, "and we expect to have same open in January if 1970. We are extremely interestedl, Ls part of our services to the coin- munity, to have a Class B Hotel Liquor License." There were three hurdlc a left between Stegeman and his li- cense. First, he had to appear before the city's Special Liquor Commit- tee. Then, their recommendation was sent to the whole council, ties. Era Interiors of Roseville, and the R. & E. Dailey Co., con- tracted to provide the facilities at a cost of $58,000. But Stegeman found himself in trouble with DBSE once again. He had neglected to apply for a building permit for his hoped- for bar. On Mar. 18, DBSE threatened Stegeman with another stop-work order, and construction halted for nearly a month, Finally, on April 15, a bailding permit was issued to the Campus Inn for construction of the pro- posed bar. The next day, City Council's Special Liquor Committes met to consider Campus Inn's applica- tion for a liquor license. At thit meeting, Stegeman for the first time was confronted by opposi- tion. THERE WAS INDEED one available license in . hi city. But there were also 26 patient applicants whose requeats pre- ceded that of the Campus Inn. And there was Kazarinoff, who launched a broadside at Stege- man himself. The meeting is difficult to re- construct because formal minutes are not kept. As City Clerk Har- old J. Saunders remembers it, both Stegeman and Conin were present and participating in the debate. Kazarinoff said he did not op- pose granting a liquor license to the Campus Inn; he oppocsed a liquor license for John C. Stege- man. He cited Stegeman'.sulti- ple building violations, tickets and fines from DBSE, and raid, in a prepared statement: "To sell liquor under licen from the State of Michigan is to hold a trust. Those holding this trust must be, before all 'No, honest and law abiding. I submit that the public record of this city proves that John C. Stegeman has been dishonest and a lass breaker." Fifth Ward Democrat Henry Stadler was absent from the committee meeting. Kazarinoff voted no. The other members, Roy E. Weber (R-fourth 'wairl) and H.C. Curry (D-first ward) voted yes. Stegeman had won an- other round. (The 26 applicants in line before him were apparent- ly not considered. In fact, they longing to the Staffn anFuneral Home. Once again, DBS2 issued a stop-work order. And once again, Stegeman had his way by set- tling the matter out of court for a reported sum of $7,000, though Staffan declines to discuss par- ticulars. And conscruction pro- ceeded. Stegeman h a d comple:ed stage one. He had 215 roonis but no liquor license-an 'ulnost cer- tain parlay to financial disaster The sense of the meeting, explains the Rev. Hoover Rupert, was "we'd been had!" Their anger was directed at Stegeman, more than liquor-and had Stegeman not been involved, Rupert says, "I don't know what the vote would have been." On February 17, 1967, an initial building permit was acquited "to build a 215-room hotel," at a pro- posed cost of $2,700 000. Con-true- tion began soon afterward.- Theoretically, with a certain, amount of land, you can only put up so much building. No so for Stegeman. He built first. and worried about boundtries after- ward. With construction already un- derway, the Department of Build- ing and Safety Engineering discovered the hotel was being erected too close to the sidewalk. Hotels are expected to be set back to permit loading and un- Since the Sheraton INn had failed with a :iecense, the chancs for a "dry" hotel eemed almost nil. Until the end of 1969, state law positively forbade the serving 'of liquor within 500 feet of any church or school. The Campus Inn is within 300 feet of three churches. Althogh the law was clear; people were already un- easy. It was difficult to believe in the reality of a day "usiel. Very early on, the question was raised at a meeting of the City Planning Commassion, by the Rev. Kendall Cowing of the First Methodist Church. According to convention hotels in terms of the. 500 foot rule." Two days later, sta e Sen. Gl- bert Bursley (R-Ann Arbor) in- troduced an amendment to the proximity law which permitted the licensing of liquor establish- ments within 500 feet of churches unless the churches voiced ob- jections. An even more lenient bill, in- troduced a month late: iin the House by Rep Antony Wierzbicki (D-Detroit), was finally passed by both houses. It require) only that churches be notified v.hen licenses are granted within 500 feet and that the state Liuor Control Commission hold a w ar- ing if .the churches filed a omi.1 protest. AS THE BILLS went through the legislature, Stegeman traveled to and from Lansrng, talking to legislators and testify- ing before the Senate Commnecce Committee, to which Bussley's bill had been sent. Commerce Committee Chair- man Sen. Harvey R. Lodge re- members "feelings ran higis" over the amendment. RangeA on one side were hotel and restaur- ant interests and people in er- ested in the convention bisminesc. Standing on the other side, with a finger in the dike, stood the Michigan Council on Alceh'tl Problems (MICAP)- the 'ca- while M i c hi g a n Temperance League. The name change ap- parently signaled a similar change in emphasis: MICAP soft-pedaled moral and aeligleus objections and concean:rat( 'f its fire on rising alcoholiass. This time, they lost. Robert Hammond, MCAP's executive director assdI chief lob- byist, maintains that legislators promised no licenses would be issued over church objections. But the bill, signed by Gov. Mli- ken in December of 1969 gave broad discretionary powers to the state Liquor Control Commission and set no limitations on their ac- tions. And so the first big leg-il- hurdle had not only been cleared but demolished. Now Stegeman could request the liquor license. In a letter to which would approve or reject it. Finally, the license could 'hen -but only then-be grantedl by the state Liquor Control Com- mission. That Commission can act only on recommendations from local" governments ; they cannot grant a license on their own. The hotel opened on schedrle in Jan. 1970, and shortly the'e- after, before any action was taken on the liquor license, work began on dining and bar facili- 420 Maynard Street, Ann Arbor, Mich. Edited and managed by students at the University of Michigan Editorials printed in The Michigan Daily express the individual opinions of the author. This must be noted in all reprints. Saturday May 29, 1971 News Phone: 764-0552 NIGHT EDITOR: JONATHAN MILLER A MAN BELIEVED TO BE JOHN STEGEMAN enters the offices of Charter Realty, Stegeman's realty company and home of Stegeman's financial operations. Secretive about his financial affairs, Stegeman has declined requests for interviews and makes few public comments on his business practices.