Major Problems in Detriot

[mountainstar]

http://www.freep.com/apps/pbcs.dll/a.../70213071/1003

“If we do not get this signed and approved by next Wednesday, I’m not prepared to go forward,” Penske said.

"Under the proposed contract, the city would pay $1.5 million in road improvements on Belle Isle that would be paid for with state and city road funds"

Ouch, $1.5 million in taxpayer funds for no benefit to the city and no approval from the local council.

[climb]

A typical problem with every street race event in every series.

[Xpunk75]

The word here in detroit is it ain't happening. Personally I don't want to waste my tax dollars on road improvements for a IRL to be able to race at Bell Ile and I think thats going to be most of the opinions of the People living here in Detroit.

[paul-collins]

Despite the alarmist quotes pulled from the text, this is the way the article ends:

Despite the concerns, a majority of the council seemed in favor of approving the three-day event.

“It’ll get approved, but first we have these questions,” Councilwoman JoAnn Watson told Penske.

Sounds less threatened than is suggested by the thread title.

Of course, as an ALMS fan, I have a vested interest in this event going forward...

[jhansen]

Indeed Paul. Very interesting. But for some to say it has "no" benefit to the City of Detroit is a bit much. There should be some local impact. And that would continue on in the future if the even is a success.

[paul-collins]

Approved.

http://www.freep.com/apps/pbcs.dll/a...36/1140/BLOG07

With little fanfare and no discussion, the Detroit City Council today approved a contract to return Grand Prix racing to Belle Isle after a six-year absence.

The council voted unanimously to allow the race to proceed over the three-day Labor Day weekend.

The five-year contract calls for the city spending at least $1.5 million, but no more than $2.5 million, in capital improvements, such as street paving, on Belle Isle. In return, the city will receive $100,000 from the race, which will increase by $25,000 every year for the next five years.

It should be noted that, even as there was this wrangling over the contract, the road works had been approved yesterday by council anyway.

http://www.detnews.com/apps/pbcs.dll...DATE/702140442

[mountainstar]

I think we have to ask what the benefit is to the taxpayers with $1.5 to $2.5 million being spent by a bankrupt city? In effect a subsidy handed to a billionaire to run a street race with no measurable benefit.

[JohnSSC]

Hmm. Same scenario in re: San Jose with CC, and folks were touting the advantages and no problems with the city being near bankruptcy, yet still shelling out $$ to support the event. We even had posts providing the estimated financial impact/benefit to the city economy.

This being an IRL race, the same scenario generates comments admonishing Detroit for spending tax dollars in this way with no measurable benefit. They "in effect a subsidy handed to a billionaire to run a street race with no measurable benefit."

When the City of San Jose spent that much on improvements and then gave the promoter additional cash, that was a good deal! I also wonder just who the promoter was/is in San Jose. If indeed it was CC doing it's own promoting, aren't the Amigos, well errr, billionaires?

Please, humor me and explain how these scenarios are different!

[luke]

Originally Posted by JohnSSC

Hmm. Same scenario in re: San Jose with CC, and folks were touting the advantages and no problems with the city being near bankruptcy, yet still shelling out $$ to support the event. We even had posts providing the estimated financial impact/benefit to the city economy.

This being an IRL race, the same scenario generates comments admonishing Detroit for spending tax dollars in this way with no measurable benefit. They "in effect a subsidy handed to a billionaire to run a street race with no measurable benefit."

When the City of San Jose spent that much on improvements and then gave the promoter additional cash, that was a good deal! I also wonder just who the promoter was/is in San Jose. If indeed it was CC doing it's own promoting, aren't the Amigos, well errr, billionaires?

Please, humor me and explain how these scenarios are different!

When you were saying what a bad event San Jose is, I said St.Pete isn't the event its made out to be. You were soon to say this wasn't about St.Pete.
I'm soon to say this is not about San Jose but about Detroit. I have to agree with norm, you guys change things to how you want to suit you...

[JohnSSC]

We were speaking specifically about San Jose and the financial problems, not the quality of the race itself. St Pete was something you brought in out of left field.

Since the comments here about Detroit sponsoring/supporting a race under nearly the exact conditions as the San Jose race, the comparison then becomes germain.

So no, I am not changing anything to suit myself (or anyone else here!).

[Tim Northcutt]

Mod Hat On:

I would think that discussions of how much $$$ a city is kicking in to host a street race, regardless of the Series, would be germane to this discussion of Detroit, the vote taken this week, and the taxpayer $$$ that are involved in hosting such a race...whether it is in Detroit, San Jose, or wherever...because cities have had to pony up funds to become a host of a street race.

Please remember to comment on the post and not the person...

Now back to topic.

[luke]

I personally like Belle Ise street circuiut, a nice and exciting layout, be interesting to see how it goes as an IRL event..Lets see what happens...

[paul-collins]

Actually, I don't think that the Detroit and San Jose situations are similar at all.

Originally Posted by mountainstar

I think we have to ask what the benefit is to the taxpayers with $1.5 to $2.5 million being spent by a bankrupt city? In effect a subsidy handed to a billionaire to run a street race with no measurable benefit.

This is money already earmarked for road upgrades by the City:

The Detroit City Council on Wednesday agreed to move up about $1.5 million in Belle Isle road repairs to this summer to accommodate the Detroit Belle Isle Grand Prix scheduled to take place in September.

The cost to the city, therefore, is the foregone opportunity by spending the money this summer instead of next, so putting some other expenditures off from this year to next. Not necessarily trivial, but not a brand new expenditure, as it was already in their capital planning for 2008.

If you still want to spend the 1.5M on the other programs that were slated, you could borrow. Conservatively, figure you could borrow at 6% to cover that, so 6% of $1.5 million is about $90k. That's your cost to the city.

Of the remaining costs:

About $7 million in upgrades for parking lots, concrete barriers and streetscapes are planned, moved up from summer 2008. Most of the repair funds will be paid through Grand Prix sponsorships brokered through the Downtown Detroit Partnership,

This would be similar to the upgrades that the DDP marshalled leading up to the Super Bowl - entirely underwritten by private funds.

For this, the City gets a refurbished Belle Isle, and an injection of $5M or so. Not a bad for a $90k investment.

[Dennis H.]

Originally Posted by Xpunk75

The word here in detroit is it ain't happening. Personally I don't want to waste my tax dollars on road improvements for a IRL to be able to race at Bell Ile and I think thats going to be most of the opinions of the People living here in Detroit.

Maybe you should talk to somebody besides your CART buddies.

[mountainstar]

Who covers the shortfall for that $7 million if enough corporate sponsorship cannot be raised? $7 million sounds like quite a bit to find for a new street race in a bankrupt city.

[Raglanparade]

They should do the full Belle Isle circuit that was made as a half real/half fantasy circuit for Grand Prix legends.

Now that would be something!

[Hazza]

Originally Posted by mountainstar

Who covers the shortfall for that $7 million if enough corporate sponsorship cannot be raised? $7 million sounds like quite a bit to find for a new street race in a bankrupt city.

A little bit of Homework goes a long way.

The Downtown Detroit Partnership (DDP) is a partnership of corporate and civic leaders including Board representation from Detroit 300, Detroit Economic Growth Corporation, Detroit Renaissance, Detroit Riverfront Conservancy and the Mayor’s Office. Together with these partners, DDP is undertaking initiatives in strategic and physical planning, research, marketing and—most significantly for 2006—support for the business community in its campaign to establish a Business Improvement District in downtown Detroit.

They happen to have backing from, among other things AT&T, Ford Motor Company, MGM Grand Casino and Visteon. And according to their Annual report in brief, they've managed to secure more than $7million dollars for numerous other projects, so finding the money for Belle Isle can't be that hard for these people, considering they exist for events like these, they'd be pretty poor at their job if they couldn't.

[paul-collins]

The concern expressed here for the taxpayers of Detroit is touching, though.

[JohnSSC]

If a private partnership has been put together to make this race happen, then that is a good thing!

[Snrub]

It's not a big deal for a city the size of Detroit to subsidize an event for a million or two. That said, has anyone here ever been to Detroit? They need every last penny available spent on their roads!

Having a race at Belle Island is useful for the city. If any city needs an image improvement and to give people a reason to come to it, it's Detroit.

On a side note I think that Detroit needs to flatten all of the bombed out areas and buildings, plant some grass and trees and put it up for sale. No one wants to be the last office or home next to the derelict buildings and crack addicts. I realize they don't have the money to do this, but there is a reason the city is nearly bankrupt.

[paul-collins]

It's been a few years since I've been to Detroit (10, I think) and I remember that bombed-out feel, Snrub. This was before the Lions got their new stadium, but Comerica Park was wonderful. I never thought I'd accept any replacement for Tiger Stadium...

I thought that the DDP was in part aimed at reclaiming some of those vacant buildings etc. I'd be interested to hear about the state of things downtown, compared to ten years ago.

[Tenoch]

I've been to Detroit several times in the past three years, to me the downtown looks just as appealing as lots of other cities. It's once you leave the downtown area that there's that bombed out feeling.
Over the years I have been to Comerica Park, Ford Field, and Joe Louis Arena as well as cobo hall for the auto show. From my experiences it seems that these facilities were excellent.
To me the problem with Detroit is not lack of top class sports venues, is the other aspects of the city. This race seems unnecessary, as Detroit has proven its ability to host large events.

[JohnSSC]

I can't comment on Detroit specifically, but Pittsburgh has similar problems. The difficulty with the vacant land/buildings is that the City does not own them. They cannot sell what they do not own. Further, Pittsburgh has many former industrial sites where all manner of nasty stuff was dumped. These sites need to be cleaned before they can be sold and/or developed. So even if you somehow took it by emminent domain (and it is funny how folks will come out of the woodwork fighting to retain "their" property even though they won't maintain it) you still have major expense involved in removing PCBs, etc.

Be nice if it were as simple as planting grass or razing vacant structures...

[Snrub]

It seems that a lot of US cities have the vacant old building problem. Emminent domain is not a good solution. I'm sure most of those land owners would take very little to sell their properties. The only value those buildings have is in the owner's ability to take a loss for tax purposes. A building that has been vacant for 30 years is a liability to anyone else because of the costs to tear them down.

I don't think the race is necessary to prove that the city can hold the event, but I think there is a tangible benefit in holding the event. I never went to the Belle Isle CC race, but it certainly looked like a nice place.

[JohnSSC]

Snrub, what you say makes sense, but the reality is much different. Pittsburgh has been struggling for years with this problem as it has prevented the types of development and even the one-off sorts of events like a street race from happening. Part of the problem is the whole issue with back taxes on properties. Most municipalities cannot just "forgive" them so whoever assumes the property assumes all of the liabilities including taxes. As you note, many find agressive use of emminent domain to be oppressive.

I have found it more than ironic that Detroit (the private sector, not the local government) let the Belle Isle race slip as one would think that a showcase of automotive engineering would be desirable. Hopefully the private group that has stepped in can make this a long-term rather than one-time race venue again.