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Gilbert offers economic impact study for fail jail site; county not swayed

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Designed by ROSSETTI via Opportunity Detroit

In the next move of the chess match for the fail jail site, Dan Gilbert’s Rock Ventures released an economic impact study to show how their proposed entertainment/soccer complex would benefit the area. The county’s response was basically, “meh.”

The study looked at construction and permanent jobs created by both the building of the soccer stadium and the new criminal justice facility vs. just building the new jail at the Gratiot site.

In a statement, Rock Ventures says that,

“Conducted by the Center for Sport & Policy at the University of Michigan, commissioned by Rock Ventures and supported by the Downtown Detroit Partnership, the study estimated an economic impact of $2.39 billion from the construction of the combined project. By contrast, the total economic impact of completing the jail on the Gratiot Avenue site is estimated at $352 million, or over $2 billion less than the impact of Rock Ventures’ proposal.

In addition, the planned development on the Gratiot Site will generate long-term economic impact upon completion, including an estimated 2,106 permanent jobs within the commercial and entertainment complex. These jobs are estimated to generate $6.4 million in local and state income tax revenue every year, including $4.9 million in State of Michigan income taxes, and $1.5 million in City of Detroit income taxes.”

Rock Ventures is looking at a combined $1.88 billion investment in the two properties, including the $420 consolidated criminal justice center at Forest and the $1.46 billion commercial development at the Gratiot site.

ROSSETTI

The study also cites that if the county were to move forward with the jail site on Gratiot, there would be no property tax generated at the site. Moving forward, it could produce great tax revenue, “Specifically, the proposed commercial development on the Gratiot Avenue site may be eligible for tax abatements and a brownfield TIF to offset the costs of demolition, site preparation, public infrastructure and structured parking. Whereas the Gratiot Avenue site generates no property taxes today, once the abatements and TIF expire, the analysis projects property tax benefits of $46.7 million annually (in current dollars).”

Wayne County Executive Warren C. Evans released this statement in response:

“This study does nothing to sway my thinking. My standard for Rock’s proposal has been absolutely clear: Is Rock prepared to build the County a criminal justice complex in a timely fashion, with buildings that meet our needs, at a price Wayne County can afford? If they can’t meet that standard, everything else is irrelevant. This study moves us no closer to answering that fundamental question.

I represent Wayne County taxpayers who continue to pay $1.2 million a month on a stalled jail they were promised years ago. I also have a responsibility to the employees, inmates and visiting families who suffer through deplorable jail conditions that continue to decline, due in large part, to that fact the County never completed the Gratiot jail after spending more than $150 million. If the benefits of one project over another are so overwhelming, it’s on those who stand to gain from it to create an alternative option to Gratiot that best protects Wayne County taxpayers. And they need to do it with the urgency and focus that takes into account the impact this project has already had on our residents, just six months removed from a consent agreement necessitated by a deep fiscal crisis.”

To recap, after not doing anything with the partially-finished fail jail site for years, Wayne County held an assessment of the site last year. The site was structurally sound, so they issued an RFP to the only construction group interested in finishing it. Dan Gilbert’s Rock Ventures, who’s been eyeing the site particularly for a soccer stadium, swooped in and not only offered a big proposal for the site in February, but also offered to build a new criminal justice complex about a mile away. The county has been vetting the proposal since.

Dan Gilbert, Chairman of Rock Ventures, says, “The contrast between the impact of the two options before the county is striking: The county can finish the current Gratiot site jail, creating minimal economic impact, produce no increase in permanent jobs and generate zero future property tax or additional city and state income tax for the next several decades. Furthermore, this option does not solve Wayne County’s significant need for updated facilities outside of the jail itself.”

Fail Jail

Gratiot at St Antoine, Detroit, MI