Time-out for opening used car lots in Warren

Warren Mayor Jim Fouts has put the brakes on more used car lots opening in the city, saying the suburb has turned into a “Wild West of car lots.”

He instituted the moratorium Wednesday in a letter to the city’s planning department, saying he wants to avoid becoming “Used Car Lot City.”

Fouts is directing the department to put a hold on new applications until the ordinance can be changed, potentially restricting the number of lots from opening in certain areas of the city.

Many of the existing lots are close to neighborhoods, particularly on the southwest side, and cause parking problems on nearby streets. Others have junk cars that “often detract from the appearance of our city,” Fouts said.

“Warren has become oversaturated with used car lots,” Fouts said. “It does nothing to enhance the city. It’s not fair to the citizens who have to deal with this.”

Warren has 55 of the businesses and Fouts said nearby Sterling Heights has less than half as many.

In Warren, an application to open a used car lot is reviewed by the Planning Commission, which sends a recommendation to the City Council, which votes on the application.

The blanket crackdown doesn’t make sense to Essa Koja, who said he’s spent a fortune of his own and borrowing from family members, for three years to open a used car business at his building in the Eight Mile and Mound area.

He said city officials led him to believe his site wouldn’t be a problem so he bought the building, spending an estimated $500,000 on the facility, upgrades and lawyer fees. He said he’s not near neighbors and has improved the building since buying it.

“I have enough room,” Koja said. “What do they want me to do? I was thinking this was my future.”

Fouts said the area in which Koja wants to open is overrun with lots.

Koja’s application is now pending before City Council, which could vote on it Sept. 8. The city’s Planning Commission has recommended it be denied.

An official with the Michigan Independent Automobile Dealers Association wasn’t available for comment late Wednesday.

Attorney Michael Bogren, a zoning expert and board chairman of the law firm Plunkett Cooney, said moratoriums like this generally are legal, as long as they aren’t unnecessarily prolonged.

Any permanent ban on new car lots from opening would be legal as long as the city clearly established a rationale behind the decision, Bogren said.

Warren already toughened its requirements for car lots last year, including requiring City Council approval and restricting lighting and signs.

“Used car lots have become a problem,” said City Council President Cecil St. Pierre. “They haven’t been planned out well.”

He’d rather see a designated area for the businesses.

One existing Warren lot owner said he agrees with Fouts, saying the city has been inundated.

“I love competition ... (but) enough is enough,” said Frank Kalla of Drive Max Auto Sales near 10 Mile and Groesbeck in Warren.

cmacdonald@detroitnews.com