Why Have We Decided That A Guy Who Became A Billionaire Selling Us Cheap Pizza Is God

[rb336]

http://www.freep.com/article/2014032...ition-M-1-Rail

...........

The demolition funds would eventually be repaid to the Strategic Fund through new tax revenues captured by the city in the downtown district

even that will be paid through money sources that WOULD NOT EXIST without the arena district development, so your article essentially says - none.

[ghettopalmetto]

Sounds somewhat like Nationals Park which opened six month before the crash.

I don't know what the 'official' count is, but thousands now live in the area called 'near southeast' before that area was light industrial or urban wasteland.

They literally have built thousands of housing units, mostly apartments in rental or condominium ownership.

Many of those housing developments near Nationals Park were in the design phase as far back as 2002 and 2003--while the Montreal Expos were still a thing. I even remember the redevelopment of Waterside Mall being talked about in 2001, which had a hiccup thanks to [[would-be prime tenant) Fannie Mae's mismanagement of money.

A lot of the restaurants near that park are frequented by workers from the Navy Yard, which is just a handful of blocks down M Street.

The truth is, land prices started skyrocketing in DC, and the near Southeast neighborhood was 1) still affordable 2) had subway access and 3) was close to employment centers. It was going to develop one way or another. In fact, the National Capital Development Commission PLANNED to redevelop that neighborhood. It just so happened to have enough strip clubs to condemn where the District could assemble large contiguous parcels of land for a shiny new mall/parkingplex, er, ballpark.

The site is all of two blocks from the Metro, and one mile from the Capitol--not quite the same as "in the middle of nowhere". Development was going to happen there. The District just tilted the table in favor of Mr. Lerner with a $636 million gift. Merry Christmas.

Sure, a publicly-funded sports monstrosity might be good for a few new restaurants and bars within a couple block radius. But plenty of neighborhoods already have restaurants and bars [[and usually much better ones than T.J. McShittergans Sports Pub). So it makes one wonder what the taxpayers receive for their hundreds of millions of dollars?

Are we so blind to note that Corktown has seen more businesses open since Tiger Stadium CLOSED? Still waiting for all of that "spinoff" from the "synergy" of Comerica Playland, Ford Field, and the casinos. Maybe if we just build one more wooden rabbit in Detroit....

[Hermod]

For much of its life, Navin Field/Briggs Stadium/Tiger Stadium was surrounded by Detroit's skid row.

[IrishSpartan]

For much of its life, Navin Field/Briggs Stadium/Tiger Stadium was surrounded by Detroit's skid row.

The heart of the old Michigan Avenue skid row was east of the ballpark. Tiger Stadium-Briggs Stadium wasn't really in middle of the notorious flop houses and dive bars since they were concentrated between Cass & Third. The Lodge became an additional buffer in the mid-50's and most of the Michigan Avenue skid row was demolished in 1963.

Also, the old Michigan Avenue skid row wasn't really dangerous. However, it was more a source of embarrassment and nuisance for Detroit politicians/downtown business leaders. The northwest part of downtown that Ilitch bought up and demolished had a more serious crime problem in those days compared to the Michigan Avenue Skid row. At night it helped to walk with someone if returning from the ballpark to downtown, but during the day it wasn't really a problem. Also, the Tigers played far more afternoon games compared the compared to ensuing years.

[emu steve]

Many of those housing developments near Nationals Park were in the design phase as far back as 2002 and 2003--while the Montreal Expos were still a thing. I even remember the redevelopment of Waterside Mall being talked about in 2001, which had a hiccup thanks to [[would-be prime tenant) Fannie Mae's mismanagement of money.

A lot of the restaurants near that park are frequented by workers from the Navy Yard, which is just a handful of blocks down M Street.

The truth is, land prices started skyrocketing in DC, and the near Southeast neighborhood was 1) still affordable 2) had subway access and 3) was close to employment centers. It was going to develop one way or another. In fact, the National Capital Development Commission PLANNED to redevelop that neighborhood. It just so happened to have enough strip clubs to condemn where the District could assemble large contiguous parcels of land for a shiny new mall/parkingplex, er, ballpark.

The site is all of two blocks from the Metro, and one mile from the Capitol--not quite the same as "in the middle of nowhere". Development was going to happen there. The District just tilted the table in favor of Mr. Lerner with a $636 million gift. Merry Christmas.

Sure, a publicly-funded sports monstrosity might be good for a few new restaurants and bars within a couple block radius. But plenty of neighborhoods already have restaurants and bars [[and usually much better ones than T.J. McShittergans Sports Pub). So it makes one wonder what the taxpayers receive for their hundreds of millions of dollars?

Are we so blind to note that Corktown has seen more businesses open since Tiger Stadium CLOSED? Still waiting for all of that "spinoff" from the "synergy" of Comerica Playland, Ford Field, and the casinos. Maybe if we just build one more wooden rabbit in Detroit....

I [[and apparently others) completely disagree with you.

Yes, it is about a mile or so from the Capitol, BUT

In 1979, without the Internet, and thinking like you, while in D.C. for a job interview, I decided to check out the area and started heading south from the Capitol.

I was shocked at some of the houses which looked 3rd world [[I think they were probably at the corner of S. Capitol and say M Street, SW. - 'across the street' from what is now Nationals Park).

I got out of there PDQ.

[Wesley Mouch]

The heart of the old Michigan Avenue skid row was east of the ballpark. Tiger Stadium-Briggs Stadium wasn't really in middle of the notorious flop houses and dive bars since they were concentrated between Cass & Third. The Lodge became an additional buffer in the mid-50's and most of the Michigan Avenue skid row was demolished in 1963.

Also, the old Michigan Avenue skid row wasn't really dangerous. However, it was more a source of embarrassment and nuisance for Detroit politicians/downtown business leaders. The northwest part of downtown that Ilitch bought up and demolished had a more serious crime problem in those days compared to the Michigan Avenue Skid row. At night it helped to walk with someone if returning from the ballpark to downtown, but during the day it wasn't really a problem. Also, the Tigers played far more afternoon games compared the compared to ensuing years.

Do I have it right that 'skid row' moved to the then quite vibrant Cass Corridor at that point in our history? [[And proving that the buildings weren't the problem.)

[Pickford-Bentler]

I [[and apparently others) completely disagree with you.

Yes, it is about a mile or so from the Capitol, BUT

In 1979, without the Internet, and thinking like you, while in D.C. for a job interview, I decided to check out the area and started heading south from the Capitol.

I was shocked at some of the houses which looked 3rd world [[I think they were probably at the corner of S. Capitol and say M Street, SW. - 'across the street' from what is now Nationals Park).

I got out of there PDQ.

One could also look at the relationship of Camden Yards to the development of the Inner Harbor community in Baltimore.

Has Camden Yards been a big waste of tax dollars?

Has Camden Yards detracted from real estate value in the area in which it is located?

[Wesley Mouch]

So we have basic disagreement on whether stadia are a urban development tool. But it is interesting to note that almost all stadia and arenas today are being built in urban centers, not farm fields. [[NJ excepted, but let's not start on Chris Christie.)

I believe they do support urban redevelopment -- but I'm not sure its the most efficient way. I hate subsidies. But I'm OK with Joe Louis Jr. Arena support solely because Detroit remains so far down and out that we need to treat Ilitch as well as other sports owners -- but no better. And that means average to slightly below average 'support'. To do otherwise would be singling out someone who has invested in the city -- even you don't like what he's done.

Is it worth mentioning that as I understand it, very little tax money is being 'diverted'. Most of this money is bonding money. Am I wrong here? I haven't followed the money on this deal.

For JLA, the taxpayer 'subsidy' was mostly bonding monies that were paid back through per-ticket fees paid by Ilitch on hockey and concerts -- but that was reduced in later years on concerts to help JLA compete with the Palace. [[And that seems to have worked.). Now I know Ilitch has worked hard to reduce his payments and pocket cash. Who wouldn't. But ultimately it was a user-fee pay for stadium deal. I think Comerica is basically the same. Per-ticket monies paying off bonds.

There may be a few million cold cash tossed at the deal -- but I think we mislead if we suggest that hundreds of millions are being given to build this place, aren't we?

[DetroitPlanner]

Are we so blind to note that Corktown has seen more businesses open since Tiger Stadium CLOSED? Still waiting for all of that "spinoff" from the "synergy" of Comerica Playland, Ford Field, and the casinos. Maybe if we just build one more wooden rabbit in Detroit....

What about Maxies, Hoot's or the United Shirt outlet?

I would agree that the moving of the Tigers was neutral. Maxie died. United Shirt folded up, not sure what happened to Hoot after he moved to Paro's Home Plate. Its been a long time, businesses come and go. The new businesses are able to draw people there who will not have to worry about congestion on game days.

I still go to Brooks to get my hardware.

Newer stadiums are designed in a way much like casinos. They want you to spend all of your money inside and have as few dollars leak out to other areas. That is one of the chief reasons why there was such a buffer set-up when Comerica was built. Did the Elwood and the Theatre have to be moved? No. Did the Wolverine Hotel have to go down? No. The same with Jolly Jim's coney. By controling that land, there is now no competition to be seen from the stadium. Yes there are places along Park, but I am willing to bet that most of the tourist types still go to substandard Hockeytown!

[Gorath]

As I understand, Comerica Park's bonds are paid by a 2% rental car and 1% hotel tax in Wayne county.

It was also supposed to be paid for by indian casino money. But that got eliminated when the casinos were built in Detroit. [[The tribes agreed to share revenue with the state so long as they were the only casinos in the state.)

In 2012 there was 61 million remaining on the 80 million, 30 year bond issued in 1997.

[IrishSpartan]

Do I have it right that 'skid row' moved to the then quite vibrant Cass Corridor at that point in our history? [[And proving that the buildings weren't the problem.)

For the most point that is what happened. Although I'm not sure how you are defining vibrant in this context regarding the Cass Corridor. Also, downtown contained some other mini skid rows like Brush & Larned, Beaubien-Brush & Gratiot. I'm sure a number of transients went moved into the Northwest Downtown hotels south of W. Vernor and west of Woodward as well. Basically, the area that has become a sea of parking lots where Mike Ilitch purchased much of the property.

[royce]

I've weighed in on this issue for quite some time. After looking at all of the arguments presented by both sides, I am going to have to side with those who believe that Ilitch has been more of a detriment to downtown Detroit than a benefit. In a nutshell, he brings us exciting sports teams and that's it. After just rewarding Miguel Cabrera with millions of dollars more, I had to ponder, "Wow, how much renovation of Ilitches' buildings and properties could have been accomplished with that money? The United Artist's Building, the Detroit Life Building, the Loyal Order of Moose Building could definitely have new life if some of that money went to renovate them instead of lining up the pockets of a millionaire with more millions.

Ilitch saved the Fox and built Comerica Park [[with some taxpayer dollars), but once we get passed that, the question to ask is , "What has he done for downtown Detroit lately?" Ilitch has sat on the buildings I mentioned earlier and owns a sea of parking lots. As of this date, he has only built two parking structures, the one behind Hockey Town Cafe and the rather small one on the northeast corner of Montcalm next to Comerica Park. Why no parking structure on the Maddison-Lennox site, or across from the Fox, or between the Fox and the Palms Building? Well, the simple answer is, "It cost more money to build parking structures than it does to maintain a fenced in, gravel parking lot." Yet, Ilitch has no problem paying millions to athletes who already make millions.

Parking structures make more room available for residential or commercial buildings. If Ilitch was a good corporate citizen he would take that into consideration, freeing up parking lot land to make room for other corporate players, instead of hogging large portions of downtown real estate for himself. It's time for Ilitch or his children at this point to step it up and become better corporate citizens. Contribute to the neighborhood and not just your little backyard, Mr. Ilitch.

[DetroitPlanner]

I've weighed in on this issue for quite some time. After looking at all of the arguments presented by both sides, I am going to have to side with those who believe that Ilitch has been more of a detriment to downtown Detroit than a benefit. In a nutshell, he brings us exciting sports teams and that's it. After just rewarding Miguel Cabrera with millions of dollars more, I had to ponder, "Wow, how much renovation of Ilitches' buildings and properties could have been accomplished with that money? The United Artist's Building, the Detroit Life Building, the Loyal Order of Moose Building could definitely have new life if some of that money went to renovate them instead of lining up the pockets of a millionaire with more millions.

What you are not asking is how much money is Miggy bringing in. I can imagine he fills a ton of seats many of which are full of people who are more than willing to blow hundreds of dollars on food and useless crap like Cabrera jerseys. Without that money coming in there would be no money to 'invest' in the bloated player salaries.

There is a reason why professional sports teams have had such a huge return on investment. I don't think you could get such an ROI from the Detroit Life building or from fortifying what was once a classic old stadium. There are some owners that will do this [[think Cubs) but even their ownership strong armed Chicago prior to agreeing to renovate instead of moving.

[ghettopalmetto]

What you are not asking is how much money is Miggy bringing in. I can imagine he fills a ton of seats many of which are full of people who are more than willing to blow hundreds of dollars on food and useless crap like Cabrera jerseys. Without that money coming in there would be no money to 'invest' in the bloated player salaries.

There is a reason why professional sports teams have had such a huge return on investment. I don't think you could get such an ROI from the Detroit Life building or from fortifying what was once a classic old stadium. There are some owners that will do this [[think Cubs) but even their ownership strong armed Chicago prior to agreeing to renovate instead of moving.

Sure, there's a Return on Investment...but for whom? The City of Detroit? Or Mike Ilitch? That's kind of the crux of the problem, don't you think? The City "invests" money, and Ilitch receives all of the Return. What a great deal for Detroit!

The problem with "thinking" about such an issue is that there are no hard numbers associated with it. Whenever an economist *does* conduct an analysis with hard numbers, though, Joe Sixpack shrugs it off due to his fandom [[an irrational decision-making basis), and says, "SHUT UP AND TAKE MY MONEY, you silly billionaire".

[rb336]

Sure, there's a Return on Investment...but for whom? The City of Detroit? Or Mike Ilitch? That's kind of the crux of the problem, don't you think? The City "invests" money, and Ilitch receives all of the Return. What a great deal for Detroit!

The problem with "thinking" about such an issue is that there are no hard numbers associated with it. Whenever an economist *does* conduct an analysis with hard numbers, though, Joe Sixpack shrugs it off due to his fandom [[an irrational decision-making basis), and says, "SHUT UP AND TAKE MY MONEY, you silly billionaire".

Please describe what downtown would be like WITHOUT Ilitch. How much do Ilitch's various things provide in taxes to the city?

Has Ilitch torn down any architecturally or historically significant buildings? Which ones and why were they significant? I know he has spent large amounts shoring up some of the vacant buildings that ARE significant. Do you prefer dilapidated buildings to parking lots?

[ghettopalmetto]

Please describe what downtown would be like WITHOUT Ilitch. How much do Ilitch's various things provide in taxes to the city?

Has Ilitch torn down any architecturally or historically significant buildings? Which ones and why were they significant? I know he has spent large amounts shoring up some of the vacant buildings that ARE significant. Do you prefer dilapidated buildings to parking lots?

Not sure if you're being facetious or not, but yes, I do prefer dilapidated buildings to parking lots. There's a very simple reason for that: New construction is expen$ive. To wit: the numerous vacant lots downtown where we were told that demolition would "inspire/spur/cause growth".

Dilapidated buildings, on the other hand, can be repaired and reused, as has been done in Philadelphia, Chicago, and now Cleveland. Depending on the conditions of the market at the time, these projects may not be feasible in the immediate moment, but markets are fluid and dynamic, and do change over time. As many people as have moved into Midtown and Downtown Detroit, there could be even more had buildings like the Madison-Lenox and Lafayette not been bulldozed.

But I digress. I'm still confused as to why Mr. Ilitch should not be expected to obtain a loan whose value would be a fraction of his own net worth. What does Detroit expect to gain by socializing more losses and privatizing more profits?

[Wesley Mouch]

Please describe what downtown would be like WITHOUT Ilitch. How much do Ilitch's various things provide in taxes to the city?

Well, for starters Ilitch directly employs about 1,000 people downtown full-time, and has done so for about 25 years -- more or less. Almost all of these jobs were set to go to Farmington Hills [[Little Caesar) or wherever the Wings/Tigers play [[here, we'd be assuming not downtown).

Average wage of $40,000, average Detroit taxes of $600 [[1.5% blended) x 1,000 = $600,000 annual direct payroll taxes x 25 years = $15,000,000

Each employee spends $20 a day in Detroit. I think that's VERY conservative. Let's assume $5 stays in Detroit. $5 x 52 x 7 x 1,000 x 25 = $45,500,000

Property taxes of about $400,000 annually x 25 = $10,000,000

And those 'ballpark' estimates are extremely conservative and don't include related jobs -- which are massive.

But what we really have is just a philosphical difference. And people each backing up their side with rhetoric. There's no doubt Ilitch has contributed to the city. And no doubt he could do more -- if he so wished.

Each side thinks if he did it their way -- there'd be much more success.

What we know for sure is that he was the first major player to head downtown when downtown wasn't cool. Give him credit for that. And respectfully disagree with what he's done. But this constant harping about Ilitch not doing exactly what you want. Just whining. Overall, he and his family have been good for Detroit. Very good.

I do dislike his approach. And I wish the M-L, Fine Arts, YMCA could have all been saved. Ah well -- in my next life I'll be rich and do things my way.

[ghettopalmetto]

Well, for starters Ilitch directly employs about 1,000 people downtown full-time, and has done so for about 25 years -- more or less. Almost all of these jobs were set to go to Farmington Hills [[Little Caesar) or wherever the Wings/Tigers play [[here, we'd be assuming not downtown).

Average wage of $40,000, average Detroit taxes of $600 [[1.5% blended) x 1,000 = $600,000 annual direct payroll taxes x 25 years = $15,000,000

Each employee spends $20 a day in Detroit. I think that's VERY conservative. Let's assume $5 stays in Detroit. $5 x 52 x 7 x 1,000 x 25 = $45,500,000

Property taxes of about $400,000 annually x 25 = $10,000,000

And those 'ballpark' estimates are extremely conservative and don't include related jobs -- which are massive.

But what we really have is just a philosphical difference. And people each backing up their side with rhetoric. There's no doubt Ilitch has contributed to the city. And no doubt he could do more -- if he so wished.

Each side thinks if he did it their way -- there'd be much more success.

What we know for sure is that he was the first major player to head downtown when downtown wasn't cool. Give him credit for that. And respectfully disagree with what he's done. But this constant harping about Ilitch not doing exactly what you want. Just whining. Overall, he and his family have been good for Detroit. Very good.

I do dislike his approach. And I wish the M-L, Fine Arts, YMCA could have all been saved. Ah well -- in my next life I'll be rich and do things my way.

I don't begrudge Mr. Ilitch for locating his company in Detroit. I'm scanning this post over and over, Wesley Mouch, and I'm just not finding the part that justifies a public GIFT of $200 million.

There are a whole bunch of business owners who read and post on these threads, and I'd wager that very few of them have ever been handed checks by the City of Detroit.

[downtownguy]

Well, for starters Ilitch directly employs about 1,000 people downtown full-time, and has done so for about 25 years -- more or less.

Like hell, he has! When Little Caesar's moved in the Fox Building, it was widely reported he was moving 400 employees. And he did not move his distribution employees into the city, but let them stay in Farmington.

If you're including baseball and hockey operations, well those existed long before Ilitch bought the teams, so no net gain.

And if you're including the casino, Ms. I owns that. And if you ask Major League baseball, she might as well be, um, let's say Pete Rose.

As ghettopalmetto said, the loan he wants is a fraction of his net worth. But sure, let's give him hundreds of millions of tax dollars. After all, his is the 9,883,997 poorest person in the state of Michigan.

[emu steve]

I don't begrudge Mr. Ilitch for locating his company in Detroit. I'm scanning this post over and over, Wesley Mouch, and I'm just not finding the part that justifies a public GIFT of $200 million.

There are a whole bunch of business owners who read and post on these threads, and I'd wager that very few of them have ever been handed checks by the City of Detroit.

Don't states usually offer businesses big incentives to move or stay, irrespective if whether it is entertainment [[e.g., sports), manufacturing, tech, etc.?

Right?

[ghettopalmetto]

Don't states usually offer businesses big incentives to move or stay, irrespective if whether it is entertainment [[e.g., sports), manufacturing, tech, etc.?

Right?

Yeah. Like Mike Ilitch is going to move the Red Wings to Indianapolis if Detroit doesn't fork over $200 million.

Job Creators, or something.

[Wesley Mouch]

Like hell, he has! When Little Caesar's moved in the Fox Building, it was widely reported he was moving 400 employees. And he did not move his distribution employees into the city, but let them stay in Farmington.

That was then. This is now -- not 25 years ago. They are bursting at the seams in the Fox Building.

If you're including baseball and hockey operations, well those existed long before Ilitch bought the teams, so no net gain.

That was then. This is now. The size of the staff for Major League Baseball has grown dramatically in the last 20 years. Hockey too. If you went to Olympia Stadium in 1965, you'd be surprised how small the full-time staff would have been. Corporate entertainment department? 1965 staff: 0 1980 staff: 4 2014 staff: ~30 FT. Same in almost every department. Did the Tiger's have a 15 person marketing department in 1970? No. But all that said, you're right. These aren't net gains. But they are jobs that are downtown, and not in Pontiac, Auburn Hills, or Monroe.

And if you're including the casino, Ms. I owns that. And if you ask Major League baseball, she might as well be, um, let's say Pete Rose.

Regardless of the Ilitch / MLB fiction about that, the employees are real. But I did NOT include casino jobs.

As ghettopalmetto said, the loan he wants is a fraction of his net worth. But sure, let's give him hundreds of millions of tax dollars. After all, his is the 9,883,997 poorest person in the state of Michigan.

You say loan. GP says gift. What is it. Is this a loan? Or a gift?

Either way, its disgusting. And its S.O.P. everywhere. This isn't a Detroit malady. This is coast-to-coast stupidity. We shouldn't be supporting sports -- but we do. And if we want to 'play' and have our sports in our downtowns, we do need to provide reasonable support and financing. And that's what we're really talking about here. Mostly, this isn't taxpayer money. JLA wasn't. Copa wasn't. This won't be. Mostly, this will be loan against future revenue collected by charging mostly suburban residents money for ticket, trinkets, and beer. Am I wrong here? I haven't watched this minute-by-minute. But I don't think the cash contribution here is from city coffers or is much of the total project cost.

[downtownguy]

You're right. I misspoke. It is a gift. Which makes it all the more disgusting.

Whether the source of the funds for this gift are taxes, fees, surcharges or assessments, they are public dollars being handed over to the 3rd richest Michiganian so he can make more profits. There are only so many public dollars you can realistically create, so by dumping a few hundred million dollars into one billionaire's pocket, you are reducing the availability of public funds elsewhere.

How about instead we give 200 entrepreneurs $1 mil each? Oh, but they might fail and the taxpayers will never get a return on their investment. Well, the way this deal is structured, Ilitch is keeping all the profits anyway, so what's the difference?

This is corporate welfare plain and simple. Wesley, it's interesting how you often claim to be a libertarian... until you're not.

[erikd]

Is it worth mentioning that as I understand it, very little tax money is being 'diverted'. Most of this money is bonding money. Am I wrong here? I haven't followed the money on this deal.

For JLA, the taxpayer 'subsidy' was mostly bonding monies that were paid back through per-ticket fees paid by Ilitch on hockey and concerts -- but that was reduced in later years on concerts to help JLA compete with the Palace. [[And that seems to have worked.). Now I know Ilitch has worked hard to reduce his payments and pocket cash. Who wouldn't. But ultimately it was a user-fee pay for stadium deal. I think Comerica is basically the same. Per-ticket monies paying off bonds.

There may be a few million cold cash tossed at the deal -- but I think we mislead if we suggest that hundreds of millions are being given to build this place, aren't we?

"To pay for the roughly $450-million arena, the Michigan Strategic

Fund

will sell bonds that will be paid off from three sources. Olympia will contribute $11.5 million a year, while the DDA will pay at least $12.8 million a year from its tax increment financing revenues, and roughly another $2 million from other tax increment revenues available to the DDA. No City of Detroit general funds will be used.
Once the Ilitches contribute $11.5 million a year to help pay off the construction

bonds

, plus maintenance and security costs, Olympia will keep all revenues from the arena operations, including ticket sales, naming rights, and other revenue."

[erikd]

You fail, utterly, to grasp the situation. There is NO OUTLAY OF CITY FUNDS. The money for the arena district can't be used for anything else because without the arena those funds are non-existent. It really isn't that difficult to grasp

It is incorrect to say that there is no outlay of of city funds or that the money can't be used for anything else without the arena.

Tax Increment Financing [[TIF) is a popular method of financing the public costs associated with development and redevelopment projects. TIF occurs when a local government freezes the tax base within a specific development district and uses the revenues generated by reassessment or new development to finance selected improvements within the district. The term “tax increment” refers to the additional taxes that will result from private development. This “increment” is earmarked or “captured” for the TIF or to other taxing units that otherwise would receive revenues. Public improvements can be financed one of two ways in a TIF plan:
- Improvements may be finances on a pay-as-you-go basis from annual tax increment revenues.
- The municipality may issue tax increment bonds to finance public improvements and use the annual tax increment revenues to retire the bonds.

While it is true that these funds are earmarked for development financing, and thus not part of the city's general fund, it is not correct to say that they cannot be used for any other purpose. These funds are available to subsidize almost any development within the defined district.

The underlying concept of TIF financing is that the diverted tax revenues will be offset by an increase in tax revenues.

The new hockey arena puts the DDA on the hook for at least $14.8 million per year, while Ilitch is only required to pay $11.5 million per year until the arena is paid for, and they get to keep all revenues from the arena and associated operations. On top of that, the arena is exempt from property taxes.

Due to the fact that the arena property itself will generate zero property taxes, the city must see a tax collection increase of at least $15 million per year just from the spinoff development that happens as a result of the new arena.

Considering the poor track record of sports arenas creating significant spin off developments, it is highly unlikely that the increased property values and economic activity around the new hockey arena will create anywhere near the additional $15 million per year needed just to cover the public payments on the debt.

How much spin of development have we seen from Comerica Park and Ford Field? A few bars and restaurants, and shitloads of surface parking lots. Certainly not enough to generate an additional $15 million a year in tax revenues...