Steve Neavling
U.S. Rep. Shri Thanedar joined activists in Detroit on Monday to oppose nearly $800 million in tax incentives to two billionaires.
U.S. Reps. Rashida Tlaib and Shri Thanedar joined activists in Detroit on Monday to demand that city officials abandon a proposal to offer nearly $800 million in tax incentives to two billionaire developers.
The Ilitch family organization and Stephen Ross’s Related Cos. stand to receive the benefits to build new residential units, hotel rooms, and office space in areas that should have already been transformed.
The proposal still needs approval from the Detroit City Council.
“This is a city administration that wants to measure their success based on how many big buildings they build instead of how much they combat poverty in our city,” said Tlaib, D-Detroit.
Tlaib pointed out that the Ilitch organization received roughly $400 million in taxpayer funds to build Little Caesars Arena and surrounding neighborhoods that never came to fruition.
She called on city officials to “stop gaslighting and lying to our residents.”
“Stop showing renderings that we know aren’t going to happen,” Tlaib said. “This is not a corporation that hasn’t shown us who they really are. They showed us. These drawings of people walking their freaking dogs and all this new housing — what did we end up with? Parking lots with obscene costs for parking.”
The project calls for the construction of six buildings and the renovation of four more controlled by the Ilitch organization. It includes 695 mixed-income residential units, 467 hotel rooms across 10 properties, 1.2 million square feet of commercial office space, and 100,000 square feet of retail.
At least 20% of the residential units would be considered affordable housing for those earning the equivalent of an annual income of $35,800 or less for a two-person household.
Most of the development would take place south of Little Caesars Arena, an area that the Ilitch organization was supposed to develop a decade ago.
The public funding includes $616 million in brownfield tax reimbursements, $133 million in tax abatements, $48 million in Downtown Development Authority funding, and a $23.7 million low-interest loan.
The incentives would not come from the city’s general fund.
Thanedar said the city “robbed” residents by overtaxing them by at least $600 million between 2010 and 2016 and has yet to compensate anyone. He said the city should be more focused on improving services, not providing handouts to billionaires.
“It is city council’s responsibility to make people’s lives better,” Thanedar said. “We serve the people. We put the people over the corporations and corporate profits. That’s what we are demanding.”
Theo Pride, community organizer for the activist group Detroit People’s Platform, said the tax incentives do nothing to help residents in the city’s struggling neighborhoods. In fact, he said, the tax handouts have caused gentrification in the Cass Corridor and forced out longtime residents.
“We give you billions and billions of dollars in our tax money to get what? To get displaced. To get pushed out of our neighborhoods,” Pride said. “We want investments in our public institutions. We are tired of our public institutions being starved and extracted from. Our children need those dollars, not Dan Gilbert, not the Ilitches.”
If all goes as planned, which rarely happens when the Ilitches are involved, the city would receive $751 million in tax revenue over 35 years.
A decade ago, in exchange for previous public funding, the Ilitches pledged to build five new neighborhoods full of retail, residential units, restaurants, and nightlife marketed as District Detroit. It never happened.
North and west of the arena, abandoned apartment buildings still dot the landscape, despite promises from the Ilitches that they would renovate them. Under the recent proposal, one of those apartments — 408 Temple St. — would be turned into housing units.
Detroit Police Commissioner Willie Burton said the tax incentives come at the expense of residents who desperately need services.
“We deserve a tax system that works for everyone, not just the wealthy developers that have been looting our city for decades,” Burton said. “Detroiters are willing to pay their taxes for good services like police and fire. Right now we demand that the Ilitches play by the same rules.”
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