Rev. Ross: Let Detroiters rebuild the city
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 (Batter Up: Public Sector Support for Professional Sports Facilities) 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.
From The Detroit News: http://www.detroitnews.com/article/20140303/OPINION01/303030001#ixzz2uu7J9xLv