Community Benefits Agreement News Weekly Roundup

September 12, 2014 -- Partnership for Working Families


Detroit council rejects land sale for new bridge to Canada, eyes alternative plan

Detroit Free Press

By Joe Guillen

September 9, 2014

The Detroit City Council today unanimously rejected emergency manager Kevyn Orr’s proposal to sell a large section of land in southwest Detroit to the state for the new bridge to Windsor.

The city’s operations chief, however, said Orr will approve the deal for $1.4 million, anyway, a power he has as emergency manager under Public Act 436. But the council’s rejection exposed concerns about the land’s sale price and whether the community will be protected during the bridge’s construction.

The land was undervalued considering the bridge development will increase its worth, Councilwoman Raquel Castaneda-Lopez said. Castaneda-Lopez and other council members opposed the deal that included a neighborhood development agreement, because it did not guarantee the Delray neighborhood will be protected. The new bridge’s customs plaza will be built in Delray, forcing about 900 residents to move.

“We are really getting the short end of the stick in terms of how much we get for the sale of land and we really are devaluing the land,” Castaneda-Lopez said. “We know that this land in particular is going to be worth exponentially more than it is now and that’s not being taken into consideration.”

Councilwoman Mary Sheffield said in a statement that the $1.4-million valuation was “comical at its best and borderline insulting.”

The Canadian government is funding most of the bridge project’s costs and would cover the state’s costs for buying Detroit’s land.

The bridge, known as the New International Trade Crossing, or NITC, could put thousands of people to work in southeast Michigan and revitalize the trade corridor with Canada. It will connect highways in Detroit and Windsor, relieving traffic congestion in both cities for commercial trucks and other vehicles.

The 301 mostly vacant city-owned parcels in Delray are needed for the project to proceed.

The council will have one week to present an alternative plan to a state emergency loan board. The board will then decide between Orr’s proposed sale to the state and the council’s alternative.

Councilwoman Saunteel Jenkins noted the state emergency loan board, made up of gubernatorial appointees, has a history of siding with Orr. Jenkins said the council’s alternative proposal for a 10-year lease of Belle Isle to the state was passed over in favor of Orr’s 30-year arrangement.

In crafting an alternative to Orr’s proposal, it does not appear the council is considering an offer from Ambassador Bridge owner Manuel (Matty) Moroun to buy the land for $1.5 million plus an additional $1 million for community development. “Does anybody have any viable proposals that they’re looking at?” Jenkins said after the council’s rejection.

Castaneda-Lopez said she is working on a counter proposal that gives the Delray community a stronger voice in future decisions regarding community benefits and an assurance that money from the land sale will be reinvested there.

Andrew Doctoroff, the state’s point man on land sales, said that proceeds from the sale would go to the city and not to bankruptcy creditors.

Several residents of Delray appeared at today’s council meeting and urged the council to reject the land sale. Simone Sagovac, of the Southwest Detroit Community Benefits Coalition, said the deal with the state does not have guarantees that the community’s concerns will be addressed. “At this point in time, sadly, we’re still being told to bang on pots and pans,” Sagovac said. “We really need the firm commitment.”


Detroit council rejects land transfer for new bridge project

Detroit News

Christine Ferretti

September 9

Detroit — The City Council unanimously rejected Tuesday a resolution to authorize the transfer to the State Land Bank of 301 city-owned parcels in the footprint of the future site of a new Detroit River bridge. It also rejected a development agreement outlining protections for the southwest Detroit residents in the path of the New International Trade Crossing.

The land transfer, put forward by Emergency Manager Kevyn Orr, called for a $1.4 million payment to the city from the Canadian government for the properties where the proposed bridge between the city’s Delray area and Windsor in Canada is to be built. Orr initially put the proposal before the Council in July, but decided to delay it as discussions continued over reaching a community benefits agreement that was acceptable to the council and the community.

Under the state’s Emergency Manager law, the council now has seven days to present a counter plan that provides the same or better value for the city. If they do, the matter will go before the state’s Emergency Loan Board for a vote. Tuesday’s decision comes a day after Council convened a meeting on the issue that drew a crowd of more than 100 people.

A second offer to buy the parcels from Ambassador Bridge owner Matty Moroun surfaced in recent days. The billionaire said he would pay the city $1.5 million for the land, and another $1 million as a “contribution” to improve and develop the neighborhood. The offer was submitted to council members and Mayor Mike Duggan on Sept. 5, but didn’t garner much discussion among council members.

“It's out of the blue,” Councilwoman Raquel Castaneda-Lopez, whose district includes Delray, remarked Monday. Duggan said Monday he saw the letter as “obviously an effort to derail” the new bridge and didn’t think it would win any support.” Orr’s spokesman, Bill Nowling, added Monday that, at this point, the Moroun offer was “nothing more than a letter.”

Ambassador Bridge Co. President Dan Stamper appeared before the Council during the public comment period Tuesday morning, and vowed the offer is “sincere” and “formal.” “Our offer is to build new homes,” he said. “Detroit would be in charge of contractors who they employ for construction. It will be rebuilt by Detroiters the way Detroit wants southwest Detroit to look.” 

Stampers’ offer to the council played to the community concerns that the state’s commitment to the Delray area would end when the transaction for the parcels was finalized. On Tuesday, Stamper called the state’s lack of commitment to the residents “disturbing.”

For months, residents have been trying to get commitments for so-called community benefits written into the agreement, hoping to target the aged, industrial neighborhood for improvements with the bridge deal. Several reiterated those concerns Tuesday.

“There’s too much pain that this community has gone through, too many impacts that we’re dealing with already and impacts that will come that warrant us being at the table,” Scott Brines, president of the Southwest Detroit Community Benefits Coalition said to the Council.

“Please do the right thing. Please take into consideration the seniors, the children ... there are a lot of people struggling to make ends meet, but they are still there. They have held on for a long time. We need to give them honor and respect when we make these land deals.”


City reaches agreement with Penguins on lower Hill District development

Pittsburgh City Paper

By Rebecca Nuttall

Sept 9, 2014 

After months of community meetings, today the city announced they'd reached an agreement with the Pittsburgh Penguins on development of the 28-acre lower Hill District site. "It's goal is to build transformational wealth for the residents of the greater Hill District," said Mayor Bill Peduto.

Among the agreement's highlights is the creation of a tax increment financing district in the Hill District, which will be the largest in the city. It will generate from $22 to $50 million of investment from the development's tax revenue for the Hill District.

Local leaders said they hoped the agreement could begin to reverse decades of disinvestment in the Hill District that began with the original development of the Civic Arena, which has since been demolished to make room for the new development. "We do have two Pittsburghs," said Kevin Acklin, the mayor's chief of staff. "We have neighborhoods in the city that haven't seen investment and development in generations."

The TIF funds can potentially be used for neighborhood improvement and investment like residential facade grants, grants for down payment and closing cost assistance, and street and utility improvements. The city said the agreement also has the highest level of commitment to minority and women business enterprise participation in the city.

"When we did the arena project it was a lot of hard work, but we found a way to work with the community and we came up with the community benefits agreement," said Penguins COO Travis Williams. "I think we've shown again that this city and this community and these corporations and foundations know how to come together to make something good happen."

But while the agreement promises millions of dollars of investment for the greater Hill District, it does not meet the community's desire for 30 percent of the development's residential units to be affordable housing. "The community hasn't even had a chance to see it let alone say whether they support it or not" said Carl Redwood, a community organizer with the Hill District Consensus Group, who interrupted a press conference earlier today where the agreement was announced. "We have the power in the community. We can stop the whole development."

Out of the 1100 residential units planned, 20 percent will be affordable housing. Of these units, 15 percent will be affordable for families and individuals making 80 percent of the area median income, 2.5 percent will be at 70 percent area median income, and 2.5 percent will be at 60 percent area median income.

This plan includes greater levels of affordability than what was originally proposed by the Penguins: 20 percent affordable housing at 80 percent area median income. Rental rates could be as low as $600.

"The economic reality of being able to get to 30 percent, the reality is the dollars to fill those gaps are limited, so this was based on an analysis of what was achievable," said Hill District councilman Daniel Lavelle.

While Lavelle admitted he didn't get everything he wanted out of the agreement, he said there will be a variety of opportunities for Hill District residents. Future efforts will focus on training individuals to be able to work on the site and building capacity in small businesses in order for them to occupy the site.

"I agree with Councilman Lavelle, you're never going to get everything you want in negotiation," said Mark Lewis, president of the POISE Foundation. "But I think we've heard things in the past about minority participation limits set for the stadiums that did not come to fruition, so we have to wait and see what the commitments are really going to be to make the opportunities available for those in the Hill District."

Work on the site will begin in the next six to nine months.