There has been a lot of hand-wringing about how to revive Rust Belt cities, and Detroit residents are hoping their city can serve as a national model. Recently residents approached the Detroit City Council with their case for a written Community Benefits Agreement (CBA) governing the development of a 45-block parcel, which will include a new Red Wings Hockey Arena. Community groups are asking the Council to include a written community benefits provision as part of the Downtown Development Authority (DDA) expansion approval.
The legislation would require that the developer work with Corridors’ Alliance (CA) and its coalition partners to ensure that community benefits are negotiated, implemented and monitored. CA also asked that Council not move forward on any future zoning change requests unless a written, binding agreement has been negotiated between the developer and CA. Because the developer has not submitted a Concession Management Agreement yet, the City Council will likely delay action on the development proposal until January.
Last summer, less than a week after the City of Detroit filed for bankruptcy, the State of Michigan’s Strategic Fund approved DDA’s request for an initial $285 million in public funding for the new arena. The agreement includes an additional $12 million subsidy each year from tax increment financing (TIF), which takes from City coffers at a time when public services like police, fire and transit have been shredded by budget cuts.
The beneficiary of this taxpayer investment is developer Mike Ilitch, founder of Little Caesars Pizza. In addition to his net worth of $3.2 billion, Ilitch also owns baseball’s Detroit Tigers, hockey’s Detroit Red Wings, MotorCity Casino and much of the land surrounding the new arena.
Since the State approval of the subsidies, CA has focused on winning a CBA. What are the City of Detroit taxpayers getting in return for their $285 million subsidy to a billionaire developer? Currently, not much. There are no new post-construction jobs at the new arena because work will be shifted from the existing Joe Louis arena. Without a CBA, there is no plan for how the local community will benefit.
CA has been organizing in the impacted community for over two years. The coalition’s plan includes a series of issues championed by coalition members:
● Jobs with good wages, benefits and career-building opportunities, including targeted hiring and apprenticeships for local residents during construction and union, prevailing-wage jobs at the arena and catalyst area post-construction
● A redevelopment plan created through an outreach process, giving residents an opportunity to participate in the project both during its construction and over its lifetime
● Small business support programs that are actually developed, implemented and monitored
● Developments built on a scale appropriate to the neighborhood, maximizing opportunities for density and mixed use, and taking into consideration proximity to current and future transportation linkages
● Construction and design that include the highest possible utilization of sustainable building practices, which are not only beneficial for the environment, but can drastically reduce energy costs
● Mixed-income housing
● Historic preservation
In addition to the arena and surrounding development, there are also plans for a new mass transit line, a new bridge to Canada and several smaller projects. If built, the developments will cost nearly $2 billion. With measurable and enforceable community benefits, these projects can begin to recreate a thriving local economy that benefits those who work to build it.