Last week, the New York Times published an important article on the Future of Health project. Unfortunately it is behind a firewall so many Detroiters don't have access. We have attempted to share pertinent points below.
Will Detroit’s Comeback Benefit Detroiters? (excerpts)
Jan. 2, 2024, 5:01 a.m. ET
Ms. Stockman, a Michigan-bred member of the editorial board, reported from Detroit.
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It’s been more than 10 years since Detroit filed for bankruptcy, and a wave of money has crashed on downtown Detroit. Section 8 apartments have become luxury condos. The greater downtown area now boasts an outdoor ice-skating rink bigger than the one at Rockefeller Center, a James Beard Award-winning patisserie and a state-of-the-art arena where some of the biggest stars in the world perform.
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As white people have flocked to the most desirable areas of the city, thousands of Black Detroiters have moved away, unable to afford to rent or buy. Worst of all, the megaprojects that are transforming Detroit are being subsidized by tax breaks and sweetheart land deals to billionaires. Many Detroiters feel their taxes are paying for the very forces that are pushing them out.
That anger fueled an activist campaign in 2016 that made Detroit the only major American city to pass a community benefits agreement ordinance that requires developers to negotiate a deal with the community for any project that receives significant tax breaks or public land transfers. In other cities, similar but voluntary agreements have been designed to provide something of value for residents who would otherwise be bystanders to big development deals: A guarantee of living wages in Los Angeles, retail spaces for local artisans in Nashville and priority hiring of disadvantaged groups in Birmingham, Ala. But in Detroit, which passed a watered-down version, it’s not clear whether this ordinance can give lifelong Detroiters a bigger stake in the city’s success.
I started out optimistic that the city would figure it out. If there’s any city that could do development without displacement, I reasoned, it should be Detroit, which has so many vacant houses. But I didn’t take into account the thorny questions about who Detroit’s comeback is for and what investors owe the people who have been here all this time.
‘Welcome to Detroit.’
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In August a neighbor told me about the latest megaproject to come to Detroit: a $3 billion medical complex created by Henry Ford Hospital, complete with a research lab the hospital will share with Michigan State University, and more than 600 units of housing that would be built by Tom Gores, the private-equity billionaire who owns the Detroit Pistons. Construction costs are expected to exceed the $2.6 billion annual budget of the city itself. And it was just a mile from our house.
Some of my neighbors welcomed the project. Others complained about being colonized. I grew hopeful that it would bring more security and jobs. But Cassandra Floyd, the executive director of the West Grand Boulevard Collaborative, a neighborhood group that was surveying hopes and fears about the project, worried that the benefits would flow to the already affluent, like the developments downtown.
A previous agreement with Henry Ford Hospital didn’t live up to expectations, Ms. Floyd said. It focused on jobs. A lot of people got hired. Then a lot lost their jobs. Cynicism set in. Once, she tried to get high school students to draw their dreams for the neighborhood. They refused. “Nobody’s going to do anything for us,” one told her.
“We have to do better this time,” she vowed.
The group decided to push for funds for home repair and rental assistance for longtime residents, among other requests in the community benefits agreement.
Asking for More
In October the community benefits process kicked off with a meeting at a local high school. Jerk chicken was served. From a distance, it looked like local democracy in action. Eighty-three area residents cast ballots for two community representatives who would sit on the committee that would negotiate a benefits package with developers. The West Grand Boulevard Collaborative scored a victory: Two candidates it endorsed won spots on the committee.
But democracy it was not. The other seven committee members were appointed by City Council members or the city planning department. The pressure to agree to whatever developers offered would be intense, warned Tonya Myers Phillips, a lawyer with the nonprofit Sugar Law Center who works closely with Ms. Floyd. Ms. Phillips said the city would do its best to limit the developer’s obligations and that developers would try to pass off existing programs or legal obligations as new benefits. She was right.
In the final package, uncompensated care for the uninsured makes up a lion’s share of public benefits that developers offered the city, even though the nonprofit hospital is already obligated to provide some of that. Representatives for the hospital and Michigan State University argued that they’re different from the for-profit developers. The project itself — the creation of a major medical complex in the city — will be enough of a huge benefit to the community, they said. That made sense. But what about Mr. Gores’s housing units? Did they really deserve the nearly $300 million in tax abatements developers were seeking? In community meetings, the tax break was presented as vital to the project’s success, ensuring a modest 4 percent return.
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Checks to Billionaires
By December, it had become clear that the new health care complex was not going to shower surrounding neighborhoods with funding. The developers offered some concessions but little to protect longtime residents from rising rents. Trading poor residents for richer ones seemed to be part of the point.
“That’s what’s so painful,” Ms. Phillips said. The committee had asked for tens of millions of dollars for rental assistance and home repair. Developers offered just $2.5 million — an amount that would be credited against any fines developers might incur for failing to hire enough Detroiters on the construction site, a requirement imposed by the city.
The committee had requested at least $3 million for grants to community groups. Developers agreed to just $300,000 to be distributed over 15 years. That comes to just $20,000 a year, to be divided among community groups in an area that’s home to thousands. It was a stunningly small amount, all the more so when you consider that Henry Ford Hospital employees a few years ago received $20,000 incentives to buy houses in the city. The message seemed clear: The powers that be bent over backward to bring new people in but not to help those already here.
Joanne Adams, a West Grand Boulevard Collaborative member who served on the negotiating committee, was so insulted by the developers’ offer that she spoke out against it, calling it “tokenism.” Others agreed. “We’re tired of giving our welfare checks to billionaires,” one woman said at a public meeting.
But the committee passed it. The City Council will probably pass it, too, when the vote comes up this month.
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Antoine Bryant, the city’s director of planning and development, told me that Detroit’s ordinance was a national model and that the Pistons’ “strong record of providing community benefits and investment in the city of Detroit” should be taken into account when evaluating the deal.
I didn’t want to let it go. I wrote to Mr. Gores, asking about the microgrants. Was that a typo? Was there a zero missing? He’s a billionaire. Couldn’t he give more? A spokesman replied that Mr. Gores was not involved in the details but defended the benefits package.
“We are not a team of real estate developers motivated by profit,” he told me in an email. “We are a group of partners who came together to improve our shared neighborhood in a way that positively impacts the community.”
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