City of Detroit "hasn't been able to collect a dime" for JLA Cable from Ilitch

**Lowell** · December-26-12, 10:27 AM

Wow, this is rather startling in light of the Ititch Organization's request for up to $12.8 million a year in tax dollars to help fund a new downtown arena.

I am sure there are some legal mumbo jumbo arguments but, on the surface, it doesn't have a good smell. Could it be that the City of Detroit doesn't have a revenue problem, but that it has a revenue collection problem? Probably both.

The City may not need an EFM; instead a EFA [Emergency Financial Auditor] may be more in order.

A little-known provision in Olympia Entertainment's lease of city-owned Joe Louis Arena and Cobo Arena promises Detroit a 25 percent share of cable television rights for live events. That's been the deal since 1980, but Detroit hasn't been able to collect a dime, according to city documents obtained by The Detroit News.

One rough estimate from finance staffers last year estimated the city is owed $70 million, but a national sports economist cautioned it's likely much lower.

The revelation comes as Olympia — led by Red Wings and Detroit Tigers owner Mike Ilitch — wants to use up to $12.8 million a year in tax dollars to help fund a new downtown arena. Critics say it's time to pay up.

"The Ilitches are a multibillion-dollar operation, and they are inside a city that is sinking," said City Councilman Kwame Kenyatta. "[[Mike Ilitch), I am sure, knows about this and should be forthcoming to help the city. Help us by writing a check, not by negotiating a new lease."

The debt is among many bills Olympia could owe the city.

Since its lease expired in 2010, the company hasn't paid millions of dollars for items such as rent, concessions and other revenue and property taxes, according to city documents obtained by The News.

In 2011, officials claimed the unpaid debt was $6 million that year, according to one city document.

From The Detroit News

**Zacha341** · December-26-12, 10:32 AM

Emergency Financial Auditor now! Should have been done years ago.

I wonder how many 'ghost' employees exist on the cities payrolls?

**Richard** · December-26-12, 11:23 AM

Kinda scary if you think about it,how many city tax foreclosures and sales have accoured because the city thought they were in the right.Opens up a whole can of worms

Some have the funds to fight city hall others do not and if they send you a bill and say you owe X amount of dollars how do you dispute it ,what average working person has the time.

I agree a EFA should have been the first thing but it kinda makes one wonder why that has not happened or who is behind the push for it not to happen.

The city has an internal auditor and has published one instance in two years but it is easy enough to throttle that department by giving them no staff.

Kinda unrelated but 4 years ago I bought 2 Cray super computer systems from the USDA gov auction for $2400 they could have run the city and half the major corporations within and they were offered to cities first at no charge but yet it is still pen and paper.

**Honky Tonk** · December-26-12, 11:44 AM

Originally Posted by Richard

I agree a EFA should have been the first thing but it kinda makes one wonder why that has not happened or who is behind the push for it not to happen.

The guy with the free hockey tickets?

This is absurd on a couple of levels. First of all, IF what Bing says is true, THAT is a serious chunk of change, and if used properly, could actually help the City. 2nd, since 1980????? These COD incompetence revelations just seem to get better each time. I see Bing just got an enhancement and not an actual pair for Christmas. He ought to start cutting off services to the JLA pending investigation and outcome. If it were the average Joe, I'm sure there would be something legal already in process.

**Detroitnerd** · December-26-12, 11:49 AM

I remember when Second City was leaving the theater Ilitch built for them. I was like, why is Second City leaving?

The people involved said they didn't want to leave, but that Ilitch owed franchise fees to Second City. Several years' worth of franchise fees. And since it looked like Ilitch was never going to pay the franchise fees, they pulled out.

**Wesley Mouch** · December-26-12, 12:45 PM

Originally Posted by Detroitnerd

I remember when Second City was leaving the theater Ilitch built for them. I was like, why is Second City leaving?

The people involved said they didn't want to leave, but that Ilitch owed franchise fees to Second City. Several years' worth of franchise fees. And since it looked like Ilitch was never going to pay the franchise fees, they pulled out.

Not true. Tossing around rumors.

**Lowell** · December-26-12, 01:00 PM

Originally Posted by Wesley Mouch

Not true. Tossing around rumors.

You have me curious. Please elaborate.

**401don** · December-26-12, 01:08 PM

The Wings have had the best lease deal in the NHL, never mind that it includes full rights to the arena, not just for the Wings. Instead of negotiating a better deal prior to 2011, they are negotiating for a service they have alread provided. How do you do that?

**mikeg19** · December-26-12, 01:33 PM

How does this level of incompetence penetrate every level of city government? If I don't pay a parking ticket a city is up your ass until they get it. Tens of millions of dollars just slips through the cracks? You can't even make this kinda stuff up.

**rb336** · December-26-12, 01:53 PM

FIVE administrations couldn't figure out this debt? Really?

**GOAT** · December-26-12, 01:58 PM

Between the City of Detroit and Old man Ford, I am wondering if ther is a bet to see who could be more inept?

This is a neck and neck race....

The Macedonian parking cartel don't pay shit!

I would take a Penske or Gilbert over any Ilitch any day of the week.

**stasu1213** · December-26-12, 02:02 PM

Originally Posted by Lowell

Wow, this is rather startling in light of the Ititch Organization's request for up to $12.8 million a year in tax dollars to help fund a new downtown arena.

I am sure there are some legal mumbo jumbo arguments but, on the surface, it doesn't have a good smell. Could it be that the City of Detroit doesn't have a revenue problem, but that it has a revenue collection problem? Probably both.

The City may not need an EFM; instead a EFA [Emergency Financial Auditor] may be more in order.

From The Detroit News

The only thing that Illitch could do is to pay off certain elected officials to not harrass him into paying back taxes then all is well

**Detroitnerd** · December-26-12, 02:43 PM

Originally Posted by Wesley Mouch

Not true. Tossing around rumors.

My friend was in a good position to know. You calling them a liar? You calling me a liar?

I know how this game is played, when two parties are fighting over money.

They could have a big, ugly lawsuit in court.

Or they can settle it outside court, with one party saying, "We didn't do it, and we won't do it again."

Shollin · December-26-12, 02:59 PM

Originally Posted by 401don

The Wings have had the best lease deal in the NHL, never mind that it includes full rights to the arena, not just for the Wings. Instead of negotiating a better deal prior to 2011, they are negotiating for a service they have alread provided. How do you do that?

This is false. I'm not sure why people keep throwing around this notion that the Red Wings have such a great deal. The city of Detroit averages over 2 million annually from the Red Wings which puts them among the top of cities in terms of lease revenue. Detroit collects a portion of suite rentals and concessions.

http://www.crainsdetroit.com/article...with-jla-talks

**Hypestyles** · December-26-12, 09:24 PM

bizarre. we'll see how this develops in the coming months. I suspect lots of back and forth bickering, with little to show by next summer.

**jerrytimes** · December-27-12, 01:30 PM

Olympia entertainment also said that once a new lease agreement is reached, all taxes would be paid. Why would you pay taxes on something that you don't have a legal lease agreement to operate?

**jerrytimes** · December-27-12, 01:32 PM

They bring so much business to the city and this story has to be published? What a joke. Sure, they should be up to date on their taxes no matter what, but it's like the story was put out there to make the Ilitches look bad.

**p69rrh51** · December-27-12, 01:48 PM

Originally Posted by jerrytimes

They bring so much business to the city and this story has to be published? What a joke. Sure, they should be up to date on their taxes no matter what, but it's like the story was put out there to make the Ilitches look bad.

No you all have been bamboozled by the press and Ilitch organization! They have been doing this for years to all their vendors and the city. Except for moving to downtown what have they done to really improve the city? Fixing up the Fox is all I can think of. Also don't even waste your time on Comerica as we were completely ripped off, we paid for his piece of shit not him!

Shollin · December-27-12, 01:50 PM

Originally Posted by p69rrh51

No you all have been bamboozled by the press and Ilitch organization! They have been doing this for years to all their vendors and the city. Except for moving to downtown what have they done to really improve the city? Fixing up the Fox is all I can think of. Also don't even waste your time on Comerica as we were completely ripped off, we paid for his piece of shit not him!

He paid for 62% of it. The rest came from hotel and rental car tax.

**p69rrh51** · December-27-12, 01:59 PM

Originally Posted by Shollin

He paid for 62% of it. The rest came from hotel and rental car tax.

Where can I find those figures?

Shollin · December-27-12, 02:06 PM

Originally Posted by p69rrh51

Where can I find those figures?

http://www.ballparks.com/baseball/american/detbpk.htm

http://detroit.tigers.mlb.com/det/ba...t=comericapark

**p69rrh51** · December-27-12, 02:27 PM

Originally Posted by Shollin

http://www.ballparks.com/baseball/american/detbpk.htm

http://detroit.tigers.mlb.com/det/ba...t=comericapark

I stand corrected. Thx for the info. Do you know where his side of the financing came from?

**MSUguy** · December-27-12, 02:27 PM

WTF? 1980? I'd say I'm shocked, but the stupid things done by the stupid shits that've run this city no longer shock me.

**ElbertHanks** · December-27-12, 02:59 PM

One of the articles mentioned how cable rights for live events may be interpreted to mean everything except hockey. And since no other events have been televised there simply is no revenue owed. I guarantee you this will be the Olympia position.

It think it is pretty irresponsible for the media to stir up the masses with headlines that say the Red Wings owe millions when the truth is there is only a chance that they might. I guess never let the truth get in the way of a good headline.

One thing I would say is that in 1980 cable tv revenue was insignificant and probably an afterthought. If the lease [[which none of us have read) can actually be interpreted to entitle the CoD to 25% you would think Olympia would have tried to renegotiate it years ago or would have left the day it expired rather than being in 'holdover' status. Then again maybe they counted on the CoD remaining incompetent and/or corrupt.

**Honky Tonk** · December-27-12, 03:26 PM

Originally Posted by jerrytimes

They bring so much business to the city and this story has to be published? What a joke. Sure, they should be up to date on their taxes no matter what, but it's like the story was put out there to make the Ilitches look bad.

The problem I have with the article is it's vagueness. They never quite quote Dave Bing. They do actually quote Kwame Kenyatta, but it doesn't specifically have anything to do with the headlines. Aside from all that, the fact that the City can't come up with anything concrete one way or another, is the most disturbing part to me. 30 years of slipshod accounting?