Despite Bankruptcy, Detroit Subsidizing New Red Wings Stadium

Detroit is bankrupt, but that isn't stopping the Red Wings from getting $400 million in taxpayer subsidies for their new stadium.

Red Wings

Despite the fact that Detroit’s financial situation is so bad that the city was forced to file for Chapter 9 bankruptcy protection, plans are still moving forward for a new stadium for the Detroit Red Wings that includes the expenditure of more than $400 million in taxpayer dollars:

Detroit’s financial crisis hasn’t derailed the city’s plans to spend more than $400 million in Michigan taxpayer funds on a new hockey arena for the Red Wings.

Advocates of the arena say it’s the kind of economic development needed to attract both people and private investment dollars into downtown Detroit. It’s an argument that has convinced Michigan Gov. Rick Snyder and Kevyn Orr, the emergency manager he appointed to oversee the city’s finances, to stick with the plan. Orr said Detroit’s bankruptcy filing won’t halt the arena plans.

“I know there’s a lot of emotional concern about should we be spending the money,” said Orr. “But frankly that’s part of the economic development. We need jobs. If it is as productive as it’s supposed to be, that’s going to be a boon to the city.”

But critics say the project won’t have enough economic impact to justify the cost, and that it’s the wrong spending priority for a city facing dire economic conditions.

Detroit city services are already stretched extremely thin. On average, police take about an hour to respond to calls for help, and 40% of street lights are shut off to save money.

“If you want people to live in the city, and not just visit to go to games, you have to invest in schools, in having the police to respond to calls,” said Gretchen Whitmer, the Democratic leader in the state senate. “There are so many investments that should trump a sports stadium.”

Additionally, Orr wants to make deep cuts to both the pensions and health care coverage promised to city employees and retirees.

The state legislature approved the taxpayer funding for the arena in December. The controversial vote split Detroit’s own legislative delegation. Whitmer argues that the matter should be reconsidered given the city’s worsening finances.

(…)

The arena will be paid for with a $450 million bond issue that will be repaid over the next 30 years. Taxpayers will be paying almost two-thirds of the cost of the arena — $283 million — and private developers will cover the rest. Including interest, it’s projected that there will be a total of $444 million in taxpayer funds spent on the project.

Additionally, the developer has committed to spending another $200 million to build retail, office, residential and hotel space as part of the project. The construction is expected to create about 8,000 construction jobs with work due to start next year.

Most of the tax money going into the project would otherwise be going into Detroit schools, which are also under state control due to their dire finances. But the lost money is slated to be made up for by the state government according to Michigan’s school-funding formula.

The arguments in favor of the stadium are the same ones that one typically hears when the issue of subsidized sports stadiums. One advocate for the project claims that a new arena for the Red Wings would bring in as much as $1 billion in economic development over 30 years, for example. However, one would expect an advocate or the project to be making such claims. Reality, as it turns out, is really quite different. Independent economic studies, such as this one by sports economists Roger Noll and Andrew Zimbalist, have shown that taxpayer subsidies for sports stadiums do not lead to significant economic benefits for the community as a whole.  Instead, the benefits go mostly to team ownership and those businesses that benefit directly from the presence of the stadium in a given neighborhood.

With respect to the Red Wings stadium specifically, critics have called the estimates of the alleged benefit to the wider community into question:

Time and time again, new stadiums or arenas in American cities either spur little to no new development around them, or the new surrounding development merely sucks business from elsewhere in the city or metropolitan area.

That’s according to economics professors, who say the economic impact numbers hung on a new, $650 million Detroit Red Wings arena and entertainment district, revealed in greater detail Wednesday, will not only have a far less of an impact as stated by its proponents, but its impact in Detroit could be a wash.

“Generally speaking, anything that happens in or around the arena is drawn away from the community or metropolitan area,” said Dennis Coates, a professor of economics at University of Maryland in Baltimore County. “In this case it’s obvious what will happen: So you build a new arena. Instead of people going to places near the old place, they go to places near the new place.”

Coates said that he has never seen a boost in overall economic activity from a new arena. As an example, he pointed to the Verizon Center near him in Washington D.C. The 20,000-seat complex housing the Washington Wizards, built in the mid-1990s, has spurred some trendy businesses around it, but has taken business away from other parts of the capitol such as Georgetown or Adams Morgan.

“You can always find places where development occurred around them, but you can also find places that lose business to it,” he said.

The agency says it will have a statewide economic impact of $1.8 billion.

Coates called those numbers “way inflated.” He said that because there are typically about 50 home hockey games per year (42 regular season games plus possible playoffs), that “it’s hard to imagine 5,000 full-time employees being needed to operate and run and manage a place that’s used 50 times a year.”

Current positions at the Joe Louis Arena also need to be taken into account, Coates said, as those will either be shifted to the new space or lost altogether.

Rod Fort, a professor of Sports Management at the University of Michigan, said it is important to focus on what the public is paying for the arena and district – and then subsequently getting out of it.

“The only reason this is interesting is they’re asking for public money,” Fort said, roughly estimating the net public investment from Michigan tax payers at $250 million. “If they weren’t asking for public money we wouldn’t care one iota. So the real question, is what is the public going to get for 250 million?”

The most egregious thing about all of this, of course, is that this plan is going forward at the same time that the City of Detroit is in the middle of a massive financial crisis that has forced it to file for bankruptcy protection. Before this crisis is over everyone who has a claim against the city, from bondholders to public employees is going to end up paying some kind of price to try to get the city out of its mess. At the same time, the Red Wings, owned by a man with a net worth over $2 billion, will end up getting a huge subsidy from the city for a stadium that they could easily afford to pay for themselves. It’s bad enough when a team extracts this kind of benefit from a city that is generally in good fiscal health, it’s positively insane when a city like Detroit ends up getting stuck with a deal like this and the City Fathers have decided that the deal is going to stand even though the city as a whole really can’t afford it. It’s generally true that there are better things than any city could be spending money on rather than a sports stadium, that is doubly true in Detroit where spending money on luxuries like a new stadium is pretty much the last thing the city should be doing.

FILED UNDER: Economics and Business, Policing, Sports, US Politics, , , , , , ,
Doug Mataconis
About Doug Mataconis
Doug Mataconis held a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020. He passed far too young in July 2021.

Comments

  1. Just Me says:

    I am opposed to public funding of these types of places in cities that are financially stable much less cities filing for bankruptcy.

    I do suspect that the Redwings provide an excellent tax source for the city-I have a hard time being convinced that the team needs a cash strapped city to pay for its new arena.

  2. Dean says:

    While I am a fan of all 4 major sports and a season ticketholder for an NFL team, I have never been in favor of public financing for stadiums.

    In no case have I seen these questions answered when teams are asking for public funds and the govenment entities are considering them:

    1) If these stadiums are such a great investment, why don’t the teams and leagues find private funding so they can keep all the benefits to themselves?

    2) How will the new stadium ensure fans will spend more dollars in the area in order to get the recovery that is projected? A new stadium does not ensure the paying fan spends more money in the newly developed area.

    3) How will a new stadium be used more days than it is currently used? More use will be required in order to get increased income and Joe Louis is used for many events beyond hockey already.

    Also, watch for the Detroit Pistons come calling for a new stadium here soon. This is another Detroit boondoggle that has the potential to leave all taxpayers across the US with the bill.

  3. gVOR08 says:

    Note that this is being decided by the emergency manager appointed by the Republican governor, not by any elected city government. A team owner with a 2 billion net worth can afford a lot of lobbyists and donations. And so it goes.

  4. Mikey says:

    A couple points from the POV of a Detroit-area native and huge Wings fan.

    First, what Coates says about the Verizon Center taking businesses away from other parts of D. C. may be true for D. C. (although in my ten years here I haven’t really seen it), but it doesn’t apply to Detroit because there aren’t any businesses to take from other parts of Detroit. Pretty much anything that’s going on there already goes on in the area around where the proposed stadium will go.

    Second, I don’t favor public funding of sports arenas, especially when the team’s ownership and organization, along with private investors, can afford to foot the bill itself. The Red Wings are not a risky investment in the Detroit area. It’s impossible to overstate how much Detroiters love that team. This could easily be done with solely private investment.

    But, if it has to be done the way it’s being done, it should still benefit Detroit. The Wings always sell out home games and the new arena will have all the swanky boxes and club seats businesses and fans want to buy. It’ll bring in plenty of money.

  5. Stan says:

    When something is really important, mirabile dictu, the money is there. Money for a new stadium yes, money for pensions no. Money for farm subsidies yes, money for food stamps no. Money for new weapons systems yes, money for infrastructure repair no. First things first.

  6. wr says:

    The city fathers?

    The city fathers?

    This a a scheme hatched by the Republican governor and his Republican appointed viceroy to transfer what little money remains in Detroit into the hands of a Republican billionaire.

    And you’re going to go on blithely blaming the terrible political system in Detroit and all those silly elected officials — who now no longer have any power, since the viceroy is the only one who can make decisions.

    This is nothing more than the Republican party of Michigan looting the remains of Detroit.

    But you get to blame it on the “city fathers.”

  7. rudderpedals says:

    Note to self: Remind next bankruptcy judge that it’s OK for my Chapter 13 debtors to budget Devil Rays season tickets and pay less to their credit card creditors, cite Detroit Lansing’s city fathers.

  8. James Pearce says:

    Considering the things I’ve read about all the sweet deals given to GM in the past, this kind of thing is one of the reasons Detroit is in such financial straits.

    It’s also how business is done these days. Developers, for mostly understandable reasons, are reluctant to make these large investments without tax incentives and concessions. The developers want to maximize profits and minimize risk, all very understandable, and these deals are readily available, if not in Detroit, then in some other NFL-worthy city…so why not?

    This approach is not helpful in the big scheme of things, of course, but without constraints, official or even moral, it will continue indefinitely.

  9. Woody says:

    This isn’t really any different than what other industry’s business owners are able to extract from cities, it’s just higher profile. This is why it’s so eye-rolling to hear the Galtian business heroes owners complain about government regulation whilst pocketing aplenty from tax incentives and public subsidies (not to mention infrastructure, etc provided by public dollars).

    I’ve always felt that the 2d greatest marketing success of all time (after De Beers) was sports ownership naming their franchises after cities/states. I’d like to pass a law mandating location be removed from team names and replace them with ownership names. Ergo, the Snyder Redskins, or the Jerry Jones Cowboys. I’d love to hear the blowhards on local sport radio defend the Wilpon Mets!

    Why not? If the owner doesn’t extract what they feel is enough, the owners have no compunction moving (explaining why L.A. is still NFL-free – it’s the Convenient Threat). Only the Packers can rightfully claim their locale – and the leagues have all prevented this from ever happening again.

  10. C. Clavin says:

    Lets call it what it is…this is Republican economics…in this case raid pension funds for corporate welfare.
    Voucherize Medicare to pay for tax cuts for the wealthiest amongst us.
    Slash teachers and cops and firemen and sanitation workers while throwing money at big Agra-biz.
    Refuse to invest in infrastructure or education but spend money on weapons the military doesn’t even ask for.
    How anyone could vote for this bunch is beyond me. They are not interested in the well-being of the Republic or its citizens. The only things Republicans care about are protecting the money of the rich…and controlling the reproduction systems of women.

  11. NickTamere says:

    Stupid question, but why wouldn’t they build this as a dual-use stadium for hockey & basketball like MSG or Verizon Center? Why aren’t all stadiums for that matter? Basketball/hockey, & football/soccer, baseball’s kind of an odd one unless cricket catches on and even then the pitch might be smaller than regulation.

  12. Andre Kenji says:

    @James Pearce:

    It’s also how business is done these days. Developers, for mostly understandable reasons, are reluctant to make these large investments without tax incentives and concessions.

    It´s very difficult to build modern and large stadiums without resorting to tax incentives, publicly subsidized loans or concessions. In most stadiums where people swore that there is no public money involved there is at least some concessions(Like public funded infrastructure in the area) or some publicly backed loan. It´s simply too expensive to be built alone.

    There is also an invisible subsidy: if a team goes broke after taking an enormous amount of debt to build a stadium, it´s doubtful that any city is going to allow a large sports franchise to go broke.

    I know, the politics behind these stadiums are horrible and that many team owners are a*. And that the economic return from these stadiums is minimal. Besides that, NHL arenas are less expensive than large stadiums for soccer or for the NFL – this Detroit Arena would be among the most expensive in the NHL. On the other hand, it´s not an easy preposition to build stadiums solely with private money.

  13. Stonetools says:

    Would it be better for Detroit if all the major league teams moved out?
    I don’t know, just asking.
    I suspect it would not be better.
    The problem era is that we cant take for granted that these teams will stay and find private financing. As experience has shown, they have options.

  14. Andre Kenji says:

    @Woody:

    I’ve always felt that the 2d greatest marketing success of all time (after De Beers) was sports ownership naming their franchises after cities/states.

    Yup. In Brazil, until the World Cup, it was very difficult for team owners to get public financing for stadiums because all the large soccer teams have rival teams in the same city where they are located.

    São Paulo has four large soccer teams. Michael Bloomberg can spend a lot of money in a stadium for the New York Yankees because the fans for it´s rival teams lives in cities that are located hundreds or even thousand of miles away.

  15. Tyrell says:

    No to taxpayers subsidizing sports owned by millionaires and played by millionaires. They make plenty of money off of the concessions to pay for new stadiums and arenas: $5 hot dogs and $4 soft drinks.
    I knew a guy several years ago that went through bankruptcy and a few months later was driving a new car and had a swimming pool put in. Figure that one out.

  16. rudderpedals says:

    @NickTamere:

    Stupid question, but why wouldn’t they build this as a dual-use stadium for hockey & basketball like MSG or Verizon Center? Why aren’t all stadiums for that matter?

    I have the same question so it obviously can’t be stupid. Do the Red Wings have a preference for hockey customization and exclusivity? If they do the answer probably lies in that direction.

  17. Yossarian says:

    @Andre Kenji: For example, like the fans of the New York Mets.

  18. superdestroyer says:

    Maybe the bond holders and the pensioners will end up opening the stadium. I wonder what the lawyers of the Red Wings think about getting themselves into the middle of the biggest municiple bankruptcy in the U.S.

  19. al-Ameda says:

    I am a big of all major sports however I do not support the use of public funds to support privately owned and operated sports franchises.

    Out here in the San Francisco Bay Area, for many years the Giants tried many times to get voter approval for a new publicly funded stadium, finally in the late 1990’s a new ownership group went to the voters with a proposal to build a PRIVATELY financed ballpark on the eastern waterfront of the city and to the surprise of no one, it was approved. The city paid for some infrastructure improvements in the area, but the $450M stadium was over primarily privately financed.

    What’s really interesting is that, until the Giants did it and opened their stadium in 2000, the last privately financed ballpark was Dodger Stadium in 1960. The other owners in MLB were not happy that the Giants did it with private funds because they thought it would establish a trend.

  20. Peter says:

    No to taxpayers subsidizing sports owned by millionaires and played by millionaires. They make plenty of money off of the concessions to pay for new stadiums and arenas: $5 hot dogs and $4 soft drinks.

    $5 hot dogs and $4 soft drinks at a sports arena? 1975 called, it wants its prices back.

  21. Peter says:

    What there should be is a federal law prohibiting the use of taxpayer funds for professional sports facilities. It has to be a federal law, as otherwise cities will try to attract teams from other cities by offering subsidized facilities.

  22. al-Ameda says:

    @Peter:

    What there should be is a federal law prohibiting the use of taxpayer funds for professional sports facilities. It has to be a federal law, as otherwise cities will try to attract teams from other cities by offering subsidized facilities.

    Seattle lost its NBA franchise because the people of Seattle did not want to finance a new arena. The owner, Clay Bennett of Oklahoma City, had a publicly financed arena in OK City ready to go, so he up and moved the team from Seattle (a great city with strong support) to OK City (a backwater) because OPKC was willing to pay for an arena.

  23. Andre Kenji says:

    @Yossarian: The Mets aren´t the Red Sox.

  24. What this world needs is more Abe Polins — owners who build their own.

  25. Franklin says:

    I basically agree with everything said here, but I might play devil’s advocate in this particular case, simply because of Mike Ilitch, the Red Wings owner, and his family. My understanding is that they are huge philanthropists, in addition to their constant investments trying to re-invigorate downtown Detroit (which have actually been partly successful – it’s certainly not the downtown area that sunk the city). So in other words, I feel like they’ve done their part. Back on the other hand, however, they’ve given a lot of money to political organizations …

  26. anjin-san says:

    Out here in the People’s Republic the Giants built the best MLB ballpark in the country and funded it privately.

  27. Ron Beasley says:

    Let’s be honest, major league sports teams are toys for the very rich. Here in the Portland Oregon area taxpayers have continued to refuse to build venues for pro sports teams so we don’t have an MLB or NFL team. The venue for the NBA team is owned by the owner of the team, Paul Allen, so he’s not likely to move the team. The improvements to the city owned venue that is the home of the MLS team was for the most part paid for by the owner of the team. The games are are almost always sold out and both are making money.

  28. Eric Florack says:

    @anjin-san: well, tell the rest of the story on that… they did so to avoid the strings attached to the usual play. and good for them….

    I am also opposed to sport franchises having stadiums built for them by government, for the record.

    I note the point also about the emergency manager being appointed by a Republican gov, and counter it with the point that GOP conservative. They need a foundational change of thinking in Detroit, not just a slight alteration. That is next to impossible in that political climate. The momentum has been going this way since the 50s, and simply getting someone of the opposite party running the place isn’t going to change it. they need someone operating from a conservative set of principles.

  29. C. Clavin says:

    “…they need someone operating from a conservative set of principles…”

    Exactly…raid the pension funds of people who earned them…and give the money away in the form of corporate welfare to people who don’t need it. That’s what passes for conservatism today. Eliminate Medicare…so the rich can have tax cuts…that’s the Ryan plan.
    There are no Conservatives today. Only Republican fundamentalists. The closest you will come to Conservatism is the Democrats.

  30. William Wilgus says:

    Nice spin, Doug—a superficial reading makes it seem that it’s Detroit’s tax money. BTW, it should be the Red Wing’s money.

  31. Marshall says:

    I understand why some people may typically be opposed to publicly-funded stadiums and arenas, but think about everything that this will do for the city of Detroit!

    Over 8,000 construction jobs and a 58 percent increase in permanent jobs in the new arena compared to Joe Louis. Outside investment will boom as the stadium moves to a more modern part of town, which will stimulate local businesses and therefore generate revenue for the city and her residents. This new arena will have a 1.8 BILLION dollar overall economic impact on Detroit!

    Take a step back and look at all the good that will come from this investment!

  32. al-Ameda says:

    @Eric Florack:

    @anjin-san: well, tell the rest of the story on that… they did so to avoid the strings attached to the usual play. and good for them….

    The “rest of the story” is that in at least 4 elections the Giants were turned down by the voters, and the new ownership group made a business decision to build it themselves so that they would all rights to all profits associated with all operations (tickets, parking, concessions, etc.) of the ball park.

    If the public had financed the ball park, the public would have been correct to expect that a share of the operating revenue would be diverted for debt service of the public financed bonds.

  33. C. Clavin says:

    “…Over 8,000 construction jobs and a 58 percent increase in permanent jobs in the new arena compared to Joe Louis. Outside investment will boom as the stadium moves to a more modern part of town, which will stimulate local businesses and therefore generate revenue for the city and her residents. This new arena will have a 1.8 BILLION dollar overall economic impact on Detroit!…”
    Yes…I’m sure that’s the propoganda going around. It is almost certainly overstated.
    I am in the building industry and 8,000 construction jobs doesn’t even pass the giggle test.
    And what is the damage done by raiding the pensions of people that earned them?

  34. Derek D. says:

    This is a great deal for Detroit:

    -More than 8,000 construction jobs
    -More than 3,000 full-time jobs
    -Thousands of spin-off and related jobs

    Not to mention the multi-billion dollar economic impact the project will have on the struggling city.

    This is a win-win for Detroit, the state of Michigan, and the citizens of Detroit.

  35. Mikey says:

    @C. Clavin: I think the 8,000 construction jobs wouldn’t be only for construction of the new arena but also for the additional construction the developer has pledged to pay for ($200 million, according to the article).

    I’m still skeptical, of course, but any work done in Detroit means tax payments the city isn’t getting right now. Anyone who works in Detroit is required to pay city income tax whether they live in the city or not.

    Unfortunately, once the construction is done, most of that will go away.

    The only way I see this really being a plus for Detroit is if whatever’s built actually succeeds in bringing people in from the suburbs. Right now that doesn’t happen a whole lot, and the lack of any decent public transportation means a lot of people simply drive to suburban venues with ample parking.

  36. Tyrell says:

    @Eric Florack: I would say with an entrepreneur, revolutionary,
    outside the box, risk taker thinking. But politics usually prevents that kind of thinking.

  37. Eric Florack says:

    @C. Clavin: Earned or extorted?

  38. Eric Florack says:

    @Tyrell: True… at least what oasses for politics today.@al-Ameda:Correct, but one supposes the taxes collected on the increases in area revenue, even with the supposed breaks being given sports teams, would mean a healthy bit of change for the tax coffers.
    and yes, that is surely the argument for the usual play on this stuff.
    but I’d reject that on principle.
    and that, I think to be what is lacking in the politics of the day. Principle.

  39. al-Ameda says:

    @Eric Florack:

    Correct, but one supposes the taxes collected on the increases in area revenue, even with the supposed breaks being given sports teams, would mean a healthy bit of change for the tax coffers. and yes, that is surely the argument for the usual play on this stuff.
    but I’d reject that on principle. and that, I think to be what is lacking in the politics of the day. Principle.

    I understand your point Eric. I’ve worked in the urban/municipal bond finance field, and I can tell you if a city was proposing to finance a stadium at the proposed construction cost of $420M, a 20 year term on the bonds would probably cost $30M-$40M in annual debt service, depending on the market for those bonds. There is no way that the increased property tax value alone could pay for debt service on the bonds (in CA the annual property tax charge is 1% of the value of the improvements (new stadium), and even if the city received the full 1% (and most cities capture far less than the 1%), that would not be sufficient for annual debt service. Nor would the annual increase in sales tax revenue due to new businesses near the stadium result in enough to make that happen. All of that being the case – my question to city staff would be, “where is the money coming from, the General Fund?”

    Good business principles are what should govern decision-making by both the private-sector and the public sector.

  40. Eric Florack says:

    one supposes that there’s a slight problem with selling Detroit bonds of late.

    Oh, and I forget who it was but the claim that his is all rich republicans reading what is left of Detroit…. Oh, come ON.
    Look,the place has been run by Democrats since the 50s… people who spared no saliva in making enemies of rich and successful types, and anyone with a profit motive. Given this, why on earth is anyone shocked that the places financials are in the toilet?

  41. al-Ameda says:

    @Eric Florack:

    Oh, and I forget who it was but the claim that his is all rich republicans reading what is left of Detroit…. Oh, come ON.
    Look,the place has been run by Democrats since the 50s… people who spared no saliva in making enemies of rich and successful types, and anyone with a profit motive. Given this, why on earth is anyone shocked that the places financials are in the toilet?

    So, you don’t understand how bond finance works?

  42. C. Clavin says:

    “…Earned or extorted?…”

    Ah…the bigotry of a typical Republican.
    I got $20 that says Florack is a taker…part of the 47%.

  43. Eric Florack says:

    @al-Ameda: the comment I referred to was on a different

    @C. Clavin: why is it every time you disagree with something, you label it “hate”?

  44. C. Clavin says:

    @ Florack…
    Because it’s not just a simple disagreement.
    You assume all pensions are extortion and not earned.
    That’s due to your predjudice.
    You’re a pathetic bigoted sad old man.
    One only has to look at your website to understand that.
    I hope you are an atheist…because. If there is a hell…that’s your destiny, loser.

  45. C. Clavin says:

    What kind of sad man puts on his CV that he is a commenter at OTB?
    http://bitsblog.theconservativereader.com/about-bitsblog/
    What a friggin’ maroon.

  46. Eric Florack says:

    @C. Clavin:
    at what point did I suggest all pensions are unearned?
    Putting words in my mouth, then trying to slay me with them?
    Pathetic.

    as for your other comment, this used to be a rather select group with a few oddballs like anjin to keep the humor level up. times change, i suppose…

  47. Marshal Bazaine says:

    Michigan’s biggest city in bankruptcy, major cuts to city services, and a cityscape that already in many places resembles a bombed-out city of WWII Germany…. how insane is this? It simply defies common sense. The State of Michigan can fund a new stadium, but NOT bail out their “premier” city? And as for the alleged “economic benefits” to a city, I can tell you that it is always either very small, or simply a “wash” when it is all within the same city. Yeah, maybe Oklahoma City is getting some economic benefit by having a new NBA team playing there, but — and here’s the kicker — the Red Wings ALREADY play in Detroit! Duh.

    This new taj mahal is being touted by it’s proponents as being some sort of economic boon to Detroit, but is this even logical? “… the developer has committed to spending another $200 million to build retail, office, residential and hotel space as part of the project.” Okay, first question: isn’t the retail and hotel space near Joe Louis Arena going to suffer from loss of business when it stands vacant (and is eventually imploded)? And second question: Where the heck are all the people and businesses to fill ANY new “retail, office, residential and hotel space” anyways??? Detroit is in the midst of a 65% loss in population since 1950. There aren’t enough folks and businesses around right now to fill up the available office and retail space. Ditto the residences that Detroit currently has. Has anyone from Lansing ever driven around the streets of Detroit? Whole blocks have been razed of their residential housing, cause there was no one to live in them. Vacancy rates in Detroit area office buildings are at all-time highs. Hundreds of retail businesses have gone out of business in the last 10 years. And a new hockey stadium is gonna solve all this?

    Finally, how has massive taxpayer funding of Ford Field and Comerica Park helped Detroit into this new age of economic boon? Unlike some cities, Detroit has two relatively recent examples of new stadiums to go by. Far as I can see, no new business came INTO the Detroit metropolitan area (I use that term for those who might quibble that Pontiac and Detroit aren’t the same cities) as a result of either stadium. People who frequented businesses near the Silverdome and old Tiger Stadium now request places near Ford and Comerica. There just ain’t any new people coming from God-knows-where to give the area any big “economic boost”. As one poster mentioned, billionaire Mike Ilitch has plenty of dough to “buy” himself some state senators and representatives, and maybe even a governor.

    What the Michigan legislature should have done is this. Since Detroit has only two things in abundance now — vacant land and debt — they should have offered Ilitch enough vacant land somewhere to build his new stadium… and that’s all, folks! He could either privately fund it, move the team elsewhere (if he can find some other suckers in another state to fleece) or stay the heck where he is in Joe Louis Arena. End of discussion.

  48. Marshal Bazaine says:

    Michigan’s biggest city in bankruptcy, major cuts to city services, and a cityscape that already in many places resembles bombed-out Germany of WWII…. how insane is this? It simply defies common sense. The State of Michigan can fund a new stadium, but NOT bail out their “premier” city? And as for the alleged “economic benefits” to a city, I can tell you that it is always either very small, or simply a “wash” when it is all within the same city. Yeah, maybe Oklahoma City is getting some economic benefit by having a new NBA team playing there, and Seattle is suffering a corresponding loss, but — and here’s the kicker — the Red Wings ALREADY play in Detroit! Duh.

    This new taj mahal for Detroit’s sports maharaja Mike Ilitch is being touted by it’s proponents as being some sort of economic boon to Detroit, but is this even logical? “… the developer has committed to spending another $200 million to build retail, office, residential and hotel space as part of the project.” Okay, first question: isn’t the retail and hotel space near Joe Louis Arena going to suffer from loss of business when it stands vacant (and is eventually imploded)? And second question: Where the heck are all the people and businesses to fill ANY new “retail, office, residential and hotel space” anyways??? Detroit is in the midst of a 65% loss in population since 1950. There aren’t enough folks and businesses around right now to fill up the available office and retail space. Ditto the residences that Detroit currently has. Has anyone from Lansing ever driven around the streets of Detroit? Whole blocks have been razed of their residential housing, cause there was no one to live in them. Vacancy rates in Detroit area office buildings are at all-time highs, so that’s just what we need — more vacant office buildings. Hundreds of retail businesses have gone out of business in the last 10 years. And a new hockey stadium is gonna solve all this? Oh, and about those purported “8,000 construction” jobs? I’ve seen estimates of far less, but either way, they are ultimately temporary jobs. Once the construction is done, the workers will either remain in Detroit and go on unemployment, or move away to where the new construction is. This is another “DUH” moment!

    Finally, how has massive taxpayer funding of Ford Field and Comerica Park helped Detroit into this new age of economic boon? Unlike some cities, Detroit has TWO relatively recent examples of new stadiums to go by. I mean, if we’re to believe the stories of economic booms, then certainly Detroit should have enjoyed it with TWO major new stadiums. Instead Detroit is in bankruptcy. Far as I can see, no new business came INTO the Detroit metropolitan area (I use that term for those who might quibble that Pontiac and Detroit aren’t the same cities) as a result of either stadium. People who frequented businesses near the Silverdome and old Tiger Stadium now frequent places near Ford and Comerica. Big whoop. There just ain’t any new people coming from God-knows-where outside of the area to give Detroit any big “economic boost”. As one poster mentioned, billionaire Mike Ilitch has plenty of dough to “buy” himself some state senators and representatives, and maybe even a governor.

    What the Michigan legislature should have done is this: Since Detroit has only two things in abundance now — vacant land and debt — they should have offered Ilitch enough vacant land somewhere to build his new stadium… and that’s all, folks! He could either privately fund it, move the team elsewhere (if he can find some other suckers in another state to fleece) or stay the heck where he is in Joe Louis Arena. End of discussion.