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Profiles in Corporate Welfare

Profiles in Corporate Welfare

Bedrock/Gilbert

Gilbert’s Net Worth is $6.5 billion. (1)

Synonymous with Corporate Welfare, Dan Gilbert’s portfolio and influence in Detroit continues to grow.  In late. 2017 Bedrock broke ground on the “Q-Scraper”, a high-end, high-rise on the old Hudson’s site that will benefit from tax incentives and tax capture for 30 years.  Gilbert received nearly 3/4 of a billion dollars in tax subsidies for this project alone!

Ford Motor Co.

Ford’s Global Revenues in 2017 were $156.7 billion. (2)

Ford Motor Co. promotes their reputation as a socially responsible corporation. They claim they want to be a good corporate neighbor but they only agreed to invest $10 Million in community. Ford can voluntarily enter into a REAL community benefit agreement with the community at any time.

The Platform

The Platform has hundreds of millions of dollars in projects in varying stages of completion. (3)

“The Platform” is a multi-site development project with locations across the city. They are also grabbing a great deal of public tax incentives to subsidize high-end housing that most Detroiters can’t afford, like their “Cass and York” project.

Olympia/Ilitch

Public financing for LCA totaled $324.1 million. (4)

For the amount of tax incentives that went into Little Caesars Arena one would think that Olympia would improve nearby  neighborhoods, but they have turned it into a large parking lot for people who don’t live in the city. 

Profiles in Corporate Welfare, sources:
1. Gilbert: forbes.com/profile/daniel-gilbert/#d6dc7d571283 
2. Ford: en.wikipedia.org/wiki/Ford_Motor_Company
3. Platform: crainsdetråçoit.com/article/20160521/NEWS/160529957/owners-of-fisher-kahn-buildings-look-to-develop-underserved-areas?fbclid=IwAR2bIPxhoaLdVQKAitn0NkA6sodF8Vbnzb05i9B0aLYEgfuY4WAbnQ3bkzU 
4. LCA: crainsdetroit.com/article/20170523/news/629041/latest-little-caesars-arena-construction-cost-8629-million   

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Infosheet: Why the Ford Deal Matters, What’s the Big Deal

Infosheet: Why the Ford Deal Matters, What’s the Big Deal

 

 

 

 

 

 

 

 

 

 

 

Equitable Detroit Coalition and Detroit People’s Platform

Infosheet: Why the Ford Deal Matters
What’s the Big Deal?

In October, Detroit City Council approved the Community Benefits Agreement struck between the Neighborhood Advisory Committee (NAC) and Ford Motor Co. around their new project in Corktown. Ford only offered 10 Million in community investment on their $740 million project. The NAC voted 9-0 to approve the Ford CBA offer. This in spite of urgings from community members to fight for a better deal.

The current Ford deal is a Bad Deal

We are giving away WAY TOO much, getting too little in return, and the “too little” we’re getting is based upon projections and intentions rather than facts and details about the process for claw-backs.

Here’s what ford gets

These incentives are made possible by:

Michigan Renaissance Zone Act
$208,796,791
in tax abatements for the Renaissance Zone, coming from a combination of city, county and state money. This is an abatement of real and personal property taxes, city corporate income tax, and utility users tax. This would occur over 30 years. Nearly $90 million would come from the City of Detroit.

Commercial Rehabilitation Act

$8,056,085
under the Commercial Rehabilitation Act (P.A. 210). Nearly $4 million in tax incentives would come from the City of Detroit. This would occur over 10 years.

Obsolete Property Rehabilitation Act (OPRA)

$18,763,677
under the Obsolete Property Rehabilitation Act (OPRA). This act allows the taxable value of a property to be frozen at its pre-improvement value with some exceptions. It would last 12 years and nearly $9 million would come from the City of Detroit. 

Neighborhood Enterprise Zone Act
$2,933,944 under the Neighborhood Enterprise Zone Act. This law allows taxable values of property to be frozen at their pre-improved value. This incentive lasts 17 years (it reduces at 15 years) and just over $1 million would come from the City of Detroit.
(Final Decision Pending)

source: https://www.freep.com/story/news/local/michigan/detroit/2018/10/16/ford-michigan-central-station-tax/1651079002/

What’s the community’s Return on investment? 

We know what Ford’s Return on Investment (ROI) is going to be, but what is the community’s ROI? 

“BUT IT’S A DONE DEAL. COUNCIL ALREADY GAVE IT AWAY. WHY DOES IT MATTER?”

Three Reasons why the Ford Deal Matters:

1. WE WANT DEVELOPMENT WITHOUT DISPLACEMENT!

We’re not opposed to development, but this goes too far.

2. INSTEAD OF BECOMING AN EXAMPLE CBA, FORD JOINS the ranks of Gilbert and the Ilitches as a bad corporate player.

This is beyond corporate welfare, this is a straight up gift to a $17 billion dollar global corporation.  For all the sentimentality around Ford Motor Company, they still roll like a corporation; driving the hardest bargain for the best deal they can get.

3. The process “gaslights” community by inviting them in and then dismissing them for already done deals.

A quick definition of gas-lighting is making people experience self-doubt or self-criticism by acting welcoming but being disrespectful. In short, saying one thing while doing another. 

Here’s what the community gets

Whatever the city collects in income tax over next 30 years.  That number will be based  on how many workers are employed and local business activity.

Ford Commits to 2,500 jobs. DEGC* says there will be 5,000 jobs. The other 2,500 jobs are just DEGC projections.  Since we know these numbers usually don’t come out as planned we’re not sure we can trust them. *Detroit Economic Growth Corporation (DEGC) manages business retention, attraction, and economic development for the city.

Ford has committed 2,500 jobs even though we are hearing about job reductions and retiree buy-outs in the media. 

What would a real CBA with Ford look like?

Every CBA is different, but REAL CBAs are community driven, meet community defined needs and are legally binding and enforceable.

A recent REAL CBA in Nashville included, setting aside affordable housing, providing child care and community services, and raised low wage jobs to $15.50 an hour.
source: https://www.tennessean.com/story/news/2018/08/02/nashville-soccer-stadium-mls-fairgrounds/11150930027

What can I do? How can we get ford back to the table?

Continue to call for the NAC to push for a better CBA deal based on the original recommendations they submitted to Ford.  ie fund the Housing Trust Fund, which supports affordable housing options for Detroiters most in need.

Attend future meetings of the NAC, Ford and city representatives and let them know how you feel. 

Support the call for the CBO amendments that are currently before City Council.

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Jefferson Chalmers Community Advocates demand Development without Displacement

Jefferson Chalmers Community Advocates demand Development without Displacement

#DevelopmentWithoutDisplacement

Detroit – Today the Jefferson Chalmers Community Advocates visited Detroit City Council to present signatures from over 300 households from their ongoing “Development without Displacement” campaign. The petition is in support of 12 demands that have been put together based on citizen led organizing and surveying.

In December 2017, a group of long time residents in the Jefferson Chalmers neighborhood came together to discuss the plans the city is making for redevelopment in their neighborhood. Jefferson Chalmers Community Advocates began to engage residents in face to face conversations about community needs while at the same time collecting important survey data.

The group has been focused on responding to the Strategic Framework Plan that the city is currently hosting community engagement meetings on. They have also met with their Council representative, Council Member André L. Spivey. Due to lack of adequate response the city Jefferson Chalmers Community Advocates have prepared, collected and are now presenting these petitions.

Petition by the People of Jefferson Chalmers

We, the undersigned residents acknowledge that the Declaration of Rights included in the Charter of the City of Detroit states “The people have a right to expect city government to provide for its residents, decent housing; job opportunities; reliable, convenient and comfortable transportation; recreational facilities and activities; cultural enrichment, including libraries and art and historical museums; clean air and waterways, safe drinking water and a sanitary, environmentally sound city.” Therefore, as residents we demand a more equitable and inclusive planning and economic development process that prioritizes the voice and recommendations of our residents and honors the community’s historical and current priorities as cited:

  • Provide home repair grants for fixed low-income residents (owner occupied) who have been residing in the home for 1 year or more.
  • Retain property tax levels at current rates for the life of the homeowner and any surviving heirs who remain in the home.
  • Ensure that only homes that cannot be rehabbed will be demolished after assessment is made by a third party not affiliated with the Land Bank.
  • Assure that once a home has been demolished a comparable home is built in its place within a 12-24 month period.
  • Community Residents will be given first priority to purchase Land Bank owned property.
  • Offer incentives to reopen a mixed-use community center, specifically Maheras-Gentry.
  • All waterfront parks will remain public.
  • Make sure there are separate buildings for elementary and middle schools for students in the Jeff Chalmers area.
  • The city office of General Services will create jobs for community residents to perform park maintenance and park patrols.
  • Upon the recommendation of an independent party demolish all Land Bank/city-owned buildings along the Jefferson Corridor that cannot be rehabbed. Offer incentives to have the demolished buildings replaced with businesses needed in the community as noted in the community survey.
  • Create an enterprise zone within the Jefferson Chalmers Community and a  Workforce Development Office.
  • Remove bike lanes from main thoroughfares, i.e. Jefferson Avenue.
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Dear Ford, If you want to create tomorrow together, let’s get real today with a legitimate CBA.

Dear Ford, If you want to create tomorrow together, let’s get real today with a legitimate CBA.

October 14, 2018
Detroit – The Equitable Detroit Coalition has released an open letter to Ford Motor Co. This letter challenges Ford to go further and agree to a CBA worthy of a $17 billion multinational corporation.

Ford Motor Co. has a net worth of nearly $17 billion. They want $239 million in tax breaks for their $740 million project in Corktown. They want to “fast track” an abatement of $104 million in city taxes over 35 years to catch another $18.7 million in tax breaks from the state by the end of October.

CALL TO ACTION:

Monday – Call Council

On Monday, October 15th, we are asking Detroit People’s Platform members and supporters to call their District Council Member and their ‘at large’ Council Members, Council President Brenda Jones and Council Member Janee Ayers. 

Tuesday – Attend Council Meeting and make Public Comment

On Tuesday, October 16th, Detroit City Council will vote on the Community Benefits Agreement for the Ford Corktown project. The meeting will begin at 10am. We advise people to arrive early to locate parking, get a seat and a public comment card.

Share the “Dear Ford” video

Please use #DearFord to share on social media.

Share the “Dear Ford” letter

Dear Ford Motor Co.,

We are the Equitable Detroit Coalition (EDC) the city-wide Community Benefit Agreement (CBA) coalition representing a constituency of nearly 100,000 Detroiters who voted “YES” on Proposal A. Proposal A mandated strong and legally binding Community Benefit Agreements on large projects that receive public subsidy.

To begin, we acknowledge the hard work of community members and the Neighborhood Advisory Council (NAC) with the Ford Motor Company’s Corktown Project. We also recognize the pressure on the NAC and the community to cooperate and not offend Ford given the unique role the corporation has played in Detroit and Southeast Michigan for the previous 100 years. Yet, we would be remiss not to lift up the fact that the fortunes of Ford Motor Company and the intergenerational wealth of the Ford family were, in part. built on the backs of labor and Detroit workers.

The tensions that many Detroiters hold regarding corporate incentives is well known and documented. In a perfect world these incentives would not exist. Sadly, the political reality is that you, Ford Motor Company, will prevail in your request for $240 million dollars in public tax subsidies successfully diverting millions of dollars from much needed community improvements for decades to come. The community asked for up to $75 million in funds to support a broad array of community benefits including affordable housing for the most vulnerable, neighborhood and infrastructure improvements, workforce training, scholarships and other benefits. Your response was to offer a package of $10 million. This doesn’t go far enough.

Further, we want to remind you that while Ford is preparing for a successful future, many residents live in present day Detroit, where real people are being negatively impacted as part of the changes this and other private economic development projects bring with them. Less than a mile away from your project there are households where families with children exist without water, are threatened with housing displacement, and possibly face forced removal from their community. The median income around the project area is only $23,160.

On behalf of our constituent base, we urge Ford representatives to return to the table and renegotiate a real and legally-binding CBA with community. We challenge Ford Motor Co. to go further and agree to a CBA that is worthy of a $17 billion, multinational corporation. If Ford wants to create tomorrow together, let’s get real today with a legitimate CBA.

Sincerely,
The Equitable Detroit Coalition

Download the letterDearFord

 

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Detroit People’s Platform Launch “Homes for All” Campaign

Detroit People’s Platform
Launch “Homes for All” Campaign

September 17, 2018
Contact: Amina Kirk
313.338.9396
amina@detroitpeoplesplatform.org

Detroit  is enjoying national attention for its revitalization efforts, but not everyone is benefiting equally. The revitalization of the housing market includes building and renovating mostly luxury housing that the average long-time Detroiter can’t afford to live in. 

On average, Detroiters pay 60% of their monthly income for housing, double the recommended 30%  and one of the highest in the nation.1

As more and more high rent units are being developed,  affordable housing is disappearing in Detroit and many of our families are experiencing high rates of eviction.2   

Today, Detroit People’s Platform will launch our Homes For All Campaign to address Detroit’s housing crisis.  And one of our first areas of focus will be the Affordable Housing Development & Preservation Fund, a Housing Trust Fund established as part of the Inclusionary Housing Ordinance in September of last year. 

Detroit People’s Platform, along with other housing advocates, created the Detroit Housing Trust Fund Coalition in 2015 to address the housing needs of low income Detroiters. The Task Force worked for over two years with then Council Member Mary Sheffield for the passage of this ordinance. 

This Housing Trust Fund will assist low income Detroiters with rental assistance, funds for home maintenance and repair for low income home owners, and assistance with relocation. The Housing Trust Fund is funded by the city of Detroit based on a small percent of annual city commercial real estate sales.  

The Detroit Housing Trust Fund Coalition was promised Detroiters would receive $2 Million Dollars to get the trust fund started, and assistance to secure additional funding. The Task Force is disappointed this $2 Million Dollars promised was removed from the budget. 

The Detroit Housing Trust Fund Coalition supports Council President Pro Tempore’s initiative to secure funding for this incredible legislation. This tool has worked to protect affordable housing in cities all over the country. The residents of Detroit deserve the same amount of funding for our Housing Trust Fund that the city leaders of St. Louis, Philadelphia, Milwaukee, and Pittsburgh provided for their long-time residents.

In the coming months, Detroit People’s Platform and members of the Housing Trust Fund Coalition will organize with Detroiters to demand deeper funding for the housing trust fund in response to the critical housing needs for low income Detroiters. 

  1. http://www.detroitmi.gov/Portals/0/docs/HousingAndRev/HRandA%20Detroit%20Inclusionary%20Housing%20Study.pdf
  2.  https://www.detroitnews.com/story/news/special-reports/2017/10/05/detroit-evictions-threaten-neighborhoods-rentals/106315064/
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Ford Let’s raise the stakes

Ford Let’s raise the stakes

“If it’s hard to understand how a multinational corporation can soak a struggling school district for tax breaks, it’s even harder to understand how government officials can justify foregoing tax revenue now in exchange for convoluted estimates of future employment: New jobs, construction jobs, indirect jobs.” Nancy Kaffer, Detroit Free Press 9/12/2018 

Ford Motor Co. has a net worth of nearly $17 billion. They want $239 million in tax breaks for their $740 million project in Corktown. They want to “fast track” an abatement of $104 million in city taxes over 35 years to catch another $18.7 million in tax breaks from the state by the end of October. For this kind of money and from this kind of corporation we want a REAL CBA.

Ford Motor Co. is going through the process outlined by the Community Benefit Ordinance, including a series of engagement activities with residents who live in the impacted area of Southwest Detroit. But Ford Motor Co. representatives also read the City Council’s Legislative Policy Division report on the so-called Community Benefit Ordinance. Ford Motor Co. know there is no mandate for a real CBA. 

Detroiters also know there is no way the city isn’t going to grant Ford Motor Co. the requested tax abatements of $104 million in city taxes over 35 years. That is money that could go for public services like fixing the pipes in our schools, enhanced senior and youth services, increased funding for libraries, parks, street repair and adequate snow removal, lawn mowing, etc. 

Ford Motor Co. promotes their reputation as a socially responsible corporation. They claim they want to be a good corporate neighbor. Let’s raise the stakes. Ford Motor Co. can willfully enter into a REAL Community Benefit Agreement, one that will confirm their desire to be a good neighbor. For this kind of money and from this kind of corporation we want a REAL CBA in which Ford honors the community’s priority recommendations that will be presented by the Neighborhood Advisory Council. We’ll be watching.

Media:

Detroit should call Ford’s bluff on $240M train station rehab

Ford seeking fast-tracked tax breaks for train station (Behind firewall)

[bctt tweet=”For this kind of money and from this kind of corporation we want a REAL CBA.” via=”no”]

 

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Detroit’s current CBA Ordinance must be amended

Detroit’s current CBA Ordinance must be amended

A year of So-called “Community Benefits”

It’s been more than a year since Detroiters went to the polls and voted for Community Benefits. It’s now  possible to amend the current ordinance so that it becomes the powerful tool Detroiters originally created in  Proposal A.

To date, in meetings with developers the Neighborhood Advisory Councils (NACs) are routinely denied the benefits requested for their communities. Three typical request from NACs not met by developers are for more time, greater transparency and more meaningful benefits.

“We are outraged and appalled by the City’s CBO Report. We spent a great deal of time working on our requests, speaking with neighbors, and doing research – not knowing that the entire development plan was already decided.” – NAC Member

The current CBA Ordinance has failed. Detroiters, for the most part are still being left out of the city’s revitalization.  As development expands and targets more Detroit Neighborhoods we need strong commitments to racial equity, which have been missing in revitalization efforts. We need guarantees that money coming in doesn’t mean we will be pushed out.

[bctt tweet=”There has been a total of $832 million in public funds and resources given away since the CBA Ordinance was enacted in 2016. We need to amend the current CBA Ordinance! #Detroit #AmendtheCBA”]

Detroit’s current CBA Ordinance must be amended:

  • Lower the $$$ threshold for project participation
  • Give community more voice in the development process
  • Include a conflict of interest clause
  • Result in legally binding agreements
  • Monitor and enforce clawbacks when developers fail to do what they say.

The transfer of public funds and resources from a majority-black city to white billionaires’ private economic projects is an example of Wealth Stripping. This extraction of public funds and resources without representation must stop. Join the movement to amend the CBA Ordinance.

Visit detroitpeoplesplatform.org to read the full Recommendations for Amendments and more about how a strong amended CBA Ordinance  can be a tool to protect, maintain and empower majority-black Detroit.

Download, Print and Share Equitable Detroit Coalitions Recommendations for Amendments: 

http://detroitpeoplesplatform.org/wp-content/uploads/2018/02/EDC_CBORecommendationsJan2018.pdf

 

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People’s Response to the State of the City #PeoplesSOTC

People’s Response to the State of the City #PeoplesSOTC

What are the REAL Issues in the nation’s largest Majority-Black City?

On March 6th, Detroit Mayor Mike Duggan will deliver this year’s State of the City address. We are coming together online and in community to offer a People’s Response.

Tuesday, March 6th, 6 – 8:30 p.m.

Join our efforts on social media
#PeoplesSOTC
or come together in community at
7700 Second Ave. at Pallister
free, secure parking

6 p.m. – Food/Social Media Strategy
7 p.m. – Viewing SOTC on a Big Screen/Social Media Action
8 p.m. – People’s Response Press Conference

We’ll view the Mayor’s State of The City address and respond through social media. After the address we’ll host and broadcast the People’s Response Press Conference and hear from people who are living through the REAL state of the city.

FB EVENT: https://www.facebook.com/events/201945927058296/

Promote the People’s Response:
[bctt tweet=”On Tues March 6th, #Detroit Mayor Mike Duggan will deliver this year’s State of the City address. We are coming together online and in community to offer a People’s Response. Join us #PeoplesSOTC http://detroitpeoplesplatform.org/2018/02/peoples-response-to-the-state-of-the-city-peoplessotc/” username=”Detroitpeoples”]

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Housing Update – Rental Registration Ordinance

In October of 2017, Detroit City Council voted unanimously on an ordinance to toughen rental regulations. The ordinance will greatly impact Detroit’s most vulnerable renters and increase displacement. The city is implementing the ordinance through the neighborhoods by zip code starting with 48215 on the East Side February 1st. 

The schedule for the first six ZIP codes is as follows:

ZIP Code Launch Date Registration Date Compliance Date
48215 February 1, 2018 May 1, 2018 August 1, 2018
48224 March 1, 2018 June 1, 2018 September 1, 2018
48223 May 1, 2018 August 1, 2018 November 1, 2018
48219 June 1, 2018 September 1, 2018 December 1, 2018
48209 July 1, 2018 October 1, 2018 January 1, 2018
49210 August 1, 2018 November 1, 2018 February 1, 2018

MORE: http://www.detroitmi.gov/News/ArticleID/2061/Citywide-Effort-to-Bring-All-Rental-Properties-into-Compliance-Begins-Feb-1-in-ZIP-Code-48215

What does the Rental Registration Ordinance mean for Detroit renters?

  • The Rental Registration Ordinance potentially creates conflict between tenants and landlords while protecting neither.
  • The ordinance mandates renters continue to pay rent into an escrow account without providing clarity around the liability of living in non-compliant buildings.
  • All landlords need to be held accountable, but the Rental Registration Ordinance has the potential to target good landlords that have provided housing to low income Detroiters for decades.
  • Decrease in places for low-income Detroiters to live.
  • Disproportionately impacts small independent landlords and further diminishes black home and property ownership.

Major issues that threaten housing stability for Detroiters:

  • Limited affordable and desirable housing, escalating rent.
  • Utility shutoffs, including water
  • Lack of home maintenance and other support programs for small landlords.

 

More on the Rental Regulation Ordinance:

Rental companies sue over Detroit inspection ordinance

http://www.detroitnews.com/story/news/local/detroit-city/2018/01/15/rental-firms-sue-detroit-inspection-ordinance/109494578/

Crains is behind a subscription firewall, but if you have on here is their recent reporting on the ordinance.  http://www.crainsdetroit.com/article/20180122/news/650786/detroit-launches-broad-plan-to-bring-rental-properties-up-to-code#

 

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Amazon HQ2 drops Detroit

Amazon HQ2 drops Detroit
 
 
In Mayor Mike Duggan‘s widely circulated response to Detroit being dropped from Amazon’s HQ2 shortlist, he states “he’s going right back to work.” Since he’s going back to work, here’s OUR SHORTLIST of projects the city needs to get on right away:
  • Stop the Water Shutoffs NOW!
  • Build a Detroit-centric transit system that works for all.
  • Invest in neighborhoods in ways that support current residents and are welcoming to an economically diverse population.
  • Build truly affordable housing that answers real Detroiters needs.
  • Bring living wage jobs to the city.
  • Invest in the commons; schools, parks, libraries, and places of culture.
Now that we know Detroit didn’t make the cut for Amazon’s HQ2. We need to remember just how much of our resources those in power are willing to give away to attract projects. Based on their willingness to give it away, we know community must continue to organize to protect, maintain and empower #MajorityBlackDetroit.
 
More:
http://detroitpeoplesplatform.org/2018/01/dear-amazon/