District Detroit development using more public funds than advertised
An analysis by Bridge reporter Tom Perkins finds tax incentives for District Detroit make up 64% of the project’s cost.
It’s a cut-and-paste story in major metro areas across the U.S. — billionaires have big ideas to create jobs and generate revenue for the city, but want tax breaks to make it happen.
For 10 years, the Ilitch Family has been touting the District Detroit as a downtown entertainment hub around Little Caesars Arena. Two decades prior, there were plans for added development around Comerica Park.
Now partnering with billionaire developer and Miami Dolphins majority owner Stephen Ross, Olympia Development wants hundreds of millions of dollars in tax breaks to complete their vision.
In a recent story for Bridge Detroit, journalist Tom Perkins did the math, concluding the total incentive package for the District Detroit is much higher than city officials are willing to talk about.
“What I found is the [Ilitch family] is proposing about $2.8 billion in investment for District Detroit, but the value of the public incentive package is about $1.8 billion,” says Perkins. “In other words, the public will be paying for or putting together a package worth about 64% of the investment.”
Detroit City Council recently approved $800 million in incentives, but that’s just a portion of the total package.
“This is likely the largest public incentive package ever put together for a real estate redevelopment project in the U.S.,” says Perkins. “That was never really discussed before. City Council voted on it. The Ilitch organization isn’t mentioning that. The Duggan administration hasn’t.”
Even if the project lives up to what has been promised, there’s no guarantee Detroiters will see a full return on investment.
“The city is throwing out some some pretty big job creation numbers, some pretty big tax revenue creation figures,” Perkins says. “And all of it sounds good, except there are scholarly studies, independent research, university studies [and] U.S. Commerce Department studies that all show that the promises made for these kinds of mega deals…almost never materializes.”
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