Henry Ford Health, the Detroit Pistons and Michigan State University officials say they’re offering Detroiters near a $3 billion New Center development the most generous community benefits deal the city has ever seen, but some residents argue the proposal falls short of the priorities raised by the community over weeks of negotiations.
The three entities have been working with a neighborhood advisory council on an agreement on developer-provided benefits that address affordable housing, health care access, career growth, education, business acceleration and recreation needs. Last week, the neighborhood group presented a list of 155 demands. A benefits proposal developers released Tuesday in response cut the number by nearly half and didn’t include several tentpole features of the neighborhood’s proposal.
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“We don’t want the perspective to be that we ignored anything, we didn’t take anything seriously,” said Denise Brooks-Williams, executive vice president and CEO for Care Delivery System Operations at Henry Ford Health. “Everything that we have seen has value and the issues that are trying to be resolved are real. However, we as the development team and mission-driven organizations are not able, perhaps, to respond to them. Please don’t take not responding to something as it being ignored.”
The “Future of Health” development plan includes a new Henry Ford Hospital campus, a joint research facility with MSU and three residential buildings financed by the Detroit Pistons. Developers plan to seek $273 million in state and local tax incentives, of which 80 percent would go toward a $322 million housing project led by the Pistons.
Several residents who spoke during the public comment portion of Tuesday’s community benefits meeting encouraged the neighborhood council to stand firm on increasing the number of “affordable” apartment units, providing rental assistance and funding home repair programs. Residents said they’re not opposed to the project, pointing to the positive benefit of more emergency hospital rooms, job opportunities for Detroiters in skilled trades and an expected economic boost for the New Center area.
“You don’t have any obligation to come out of this process with a deal,” resident Nate Phillips told the neighborhood council. “We’re not asking for charity, we’re being asked to invest (tax incentives) and we’re asking for a return on that investment. (The developers’ benefits package) is a bunch of stuff nobody asked for and nobody really cares about. The stuff people do care about was just conveniently thrown to the side.”
Richard Haddad, chief operating officer for the Pistons, said the value of benefits sought by the neighborhood advisory council totaled more than $2.5 billion. Developers estimate their benefits proposal covers $602 million.
“It was a significant ask,” Haddad said. “We put in a lot of work responding to that ask and delivering as much as we could. That got us to a place that we’re proposing to deliver a benefits package that is (worth) multiples more than any other package that’s come out of any (Detroit community benefits) process.”
BridgeDetroit asked Haddad after the meeting how much of the benefits package the Detroit Pistons would be responsible for, since the organization is receiving the bulk of tax breaks. Haddad referred questions to the organization’s communications team. BridgeDetroit did not receive a response to emailed questions about the Pistons benefits responsibilities.
Some residents questioned how the $602 million figure was calculated, echoing similar criticisms about the last major project to advance through the community benefits process.
Developers behind the $1.5 billion District Detroit project downtown said their $167 million benefits package was the largest at the time. Some residents said the number was inflated by including investments already planned before the neighborhood negotiations started.
Joanne Adams, vice chair of the neighborhood council, said the list of benefits from the developers included “next to nothing” to support renters. She said the $602 million figure is questionable, and should not include items that will be taxpayer-subsidized.
A significant portion of the value, roughly $400 million, comes from new research activity and additional health care services created by the hospital expansion. Some residents said that would happen independent of the negotiation process and artificially inflates the benefits value.
“Most of these things the developers were already planning on doing,” said Biahua Yu, a homeowner in the impact area.
The benefits package presented Tuesday includes a steeper discount on rent for a portion of “affordable” housing units. Rents will be reduced for 133 out of the 662 housing units (20 percent of the total).
The Pistons organization originally planned to make rent affordable for people earning $33,150 – half of the area median income for Southwest Michigan. Detroit’s median income is $36,453, according to the U.S. Census Bureau.
Two percent of the units, 13 total, will be affordable for people earning $19,890 under the benefits package presented Tuesday. Rent became slightly higher for 13 other units, with rates set to be affordable for people earning $46,410. Discounted rates for the other 107 units remain unchanged.
Developers agreed to ensure the affordable rates are set for 30 years and committed to accepting Section 8 vouchers.
The benefits deal establishes several financial investments. This includes a $15 million donation to the Ruth Ellis Center to address youth homelessness, a $30 million investment in green space on the south side of West Grand Boulevard near the hospital campus and $100 million in targeted spending toward disadvantaged and Detroit-based businesses.
It also includes other benefits that don’t have a dollar value attached. Henry Ford would create an additional primary care facility. MSU would create 50 free tuition scholarships for seniors graduating from University Prep High School and Northwestern High School. Henry Ford committed to ensuring 51 percent of construction workers involved in its development projects are Detroiters.
The development team is committing to a plan to reduce the impact of multiple phases of construction. This includes a website where residents can follow updates and send concerns, and plans to address dust control, vibration monitoring, truck routing and other impacts.
Henry Ford officials also pledged to come up with a redevelopment plan for the former Fairbanks Elementary School located east of the Lodge Freeway near the hospital. Neighbors said the building is crumbling due to neglect.
Other elements listed in the benefits package come from the city of Detroit, like Motor City Match grants and the General Services Department and Gilbert Family Foundation, which also raised eyebrows among critical residents.
Jeff Cowin, president of the Virginia Park Historic District Block Club, said the neighborhood group needs to keep fighting for home improvement funding and other benefits that didn’t make it into the development proposal.
“I think we all feel we’ve been low-balled,” Cowin said. “Go back with a much bigger counter than you came into this meeting thinking you were going to. We’re behind you.”