Let Detroiters rebuild the city, The Detroit News
The Detroit News
Rev Joan Ross
March 3, 2014
The Detroit City Council recently granted Olympia Development of Michigan almost $3 million worth of public land and hundreds of millions of public dollars to erect a hockey arena and pursue other developments in Detroit’s Cass Corridor. The argument behind putting public money and resources into private sports complexes and the like is that municipalities will recoup the money from tax revenue and revitalization. But careful study of these deals reveals otherwise.
Research from 1984 by Forest College economist Robert Baade right up to 2012 by the investment bank UBS shows that cities generally don’t benefit from such deals. To quote the UBS study: “Unfortunately, independent academic research studies consistently conclude that new stadiums and arenas have no measurable effect on the level of real income or employment in the metropolitan areas in which they are located.”
In spite of UBS’s findings, there is one way such deals can benefit someone other than the developer. The only times taxpayers see tangible benefits from bankrolling billionaire sports franchise owners is when the community demands and gets community benefit agreements, which are contracts signed by developers. The Staples Center in Los Angeles and the CONSOL Energy Center in Pittsburgh are examples of such projects benefiting the cities involved through community benefit agreements. Both cities were in better financial shape than Detroit is today, and both still found it necessary to protect themselves financially.
Even though the City Council accepted Olympia’s handshake and promise to do right by Detroiters this time, there is an ordinance before the council that would guarantee community benefit agreements for such projects in the future. Just as Olympia would never sublet work to another firm without a contract, it is only fair that the city have an equally enforceable agreement for hundreds of millions of public dollars.
If Detroiters don’t value the city’s assets and integrity, developers never will. Indeed, the bankruptcy has created a fire sale mentality where everything is supposed to be had on the cheap. City Council must take steps make sure the city gets a fair deal with developers:
- Developers sign legal contracts to abide by the terms of the community benefit agreement.
- Community oversight boards to ensure transparency.
- Developers hold public hearings on projects with adequate notice.
- Rent control and other protections for residents in the case of rising property values.
- Projects should train and employ city residents.
These are some of the broad outlines of how the city must conduct business to keep residents from getting the short end of the stick.
In a just world, billionaires would fund their own projects. It is particularly unjust that corporations come to an entity as short on resources as the city of Detroit and demand resources to fund privately owned development.
The least City Council can do is pass an ordinance to protect the city and its residents by leveling the playing field for Detroiters.
The Rev. Joan C. Ross is director of the North End Woodward Community Coalition and executive director of the Greater Woodward Community Development Corp.
By Andre Horton
March 3, 2014
With numerous proposed and approved local development projects taking place throughout Erie County, it is crucial that local government entities and developers engage in direct and honest conversations about how we collectively proceed to ensure the betterment of all residents in the community.
The recent Erie County Council vote on the bond guarantee supporting the Erie County Convention Center Authority hotel and parking ramp development highlighted several areas of concern. The concerns of a community can only be addressed effectively by adequate independent information, transparency, open debate and full participation.
Concerns, when answered correctly, can reap long-lasting benefits. Conversely, ignoring the concerns of the many city dwellers on the hill leads to gentrification and lasting negative effects and perceptions that are not healthy for a forward-thinking community.
Further development of our prized bayfront -- including Scott Enterprises' Harbor Place, the Inland Port Project and other proposed major capital projects -- have dominated the headlines in recent months and will continue to do so. When a new proposal is introduced, each presenter or developer touts how their project would benefit the community, usually speaking in terms of jobs created and other possible pluses. Supporters emphasize the potential positive impact on the lives of our taxpayers and residents.
These benefits, in reality, may or may not materialize. Opponents speak about the need for more transparency while seeking substantive, objective answers to how these projects would benefit or harm their constituents. Whether it is authorities created by and for taxing bodies that are using our tax dollars or requesting bond guarantees or it is private developers using public moneys, i.e. grant dollars, it's time that we as a community stop leaving these benefits to chance.
One way to do this is for communities to enact policies that promote Community Benefits Agreements between stakeholders and developers. Pursuing CBAs encourages direct, good-faith conversations between the community-based stakeholders and developers. Stakeholders form and build coalitions comprised of local residents from all economic and social strata, including people of all colors and ethnicities, labor representatives, environmental groups and communities of faith.
This broad-based coalition then participates in the process from the start, ensuring transparency while allowing for more constructive, cooperative and collaborative opportunities to address community needs. The collaborative process allows for public dialogue while identifying those needs and setting goals. The coalition can set guidelines for local hiring, training and workforce initiatives that continue to yield benefits to a community long after a specific project is completed.
CBAs implemented by local governments attach enforceable standards to subsidized developments especially, but not limited to, those sweeping developments on publicly leased or owned lands or using public resources. Those lands publicly owned or developed under agreement with local governments that have assumed risks should also yield benefits to their residents, who should always share in the prosperity. CBAs can be site specific and create opportunities for local residents, local workers, and neighboring communities or neighborhoods.
I pressed hard behind closed doors and in public for a CBA here because I saw it as an all-inclusive, win-win approach for the entire community. CBA coalitions and neighborhood partners recognize and acknowledge the need for collaborative visions and development of our assets. They also recognize that they have a stake in its success.
Residents receive tangible benefits from this approach; skills training can be a catalyst for lifting whole families out of poverty. Labor will benefit from project labor agreements that provide jobs with living wages while strengthening the local workforce through apprenticeship and training. Developers enjoy public support devoid of the oftentimes adversarial relationships and the perception of elitism that happen when projects are perceived to lack, and often do lack, transparency, public input and inclusion. Lastly, governments and municipalities receive maximum returns on their investments far beyond the raising of a physical structure that it hopes will attract consumers and infuse revenue into our local economy.
In Erie County, CBAs can change the traditional land-use model, while at the same time lay the groundwork to lift many of our residents out of poverty. CBAs are smart business. CBAs promote equity, fairness, opportunity and benefits to the entire community and hold developers accountable for their promises to local governments and residents.
Properly structured CBAs are legally binding and directly enforceable by all signatories. These agreements have been successful in communities such as Portland, Ore.; Los Angeles and Oakland, Calif.; and Hartford, Conn. Most notably, CBAs have succeeded in Pittsburgh at the Consul Energy Center and at other developments in the Hill District, where that area's neighborhoods continue to be transformed.
We should adopt Community Benefit Policies and adhere to other best practices so that we can move forward together, not only revitalizing our landscape but also instilling newfound hope into our most vulnerable residents and neighborhoods.