Welcome back. I’m still Malachi Barrett.

The City Council unanimously upheld the Office of Inspector General’s decision to suspend prominent demolition contractor Gayanga and its owner Brian McKinney, pending an investigation into the source of contaminated dirt spread across Detroit. 

Council members were tasked with deciding whether the OIG abused its discretion by temporarily suspending Gayanga and McKinney in September. It would have taken a two-thirds majority to overturn the suspension. The council agreed 9-0 that it was justified after hearing arguments in a two-hour special session.

The OIG alleged that Gayanga used contaminated dirt from a Northland Mall redevelopment in Southfield. Attorneys representing McKinney claim the contaminated backfill dirt was purchased from city-approved vendors. But Inspector General Kamau Marable said the city’s evidence tells a different story, suggesting “several sources and vendors” of backfill dirt.

Marable said limited details could be shared about the investigation into Gayanga, but it started when the OIG received credible information that contaminated backfill was being put into demolition sites, he said.

Environmental testing found contamination at 42 of 47 sites exceeded state pollution standards. Marable said 62% of the sites were found “unsafe for direct human contact.”

Gayanga has filled roughly 2,400 residential sites across Detroit. Marable said he “would have been negligent in my duty” to not issue a temporary suspension after contamination was found at most sites tested so far.

“There is real-world impact for these citizens,” Marable said. “We are fact finders. I don’t get paid by the suspension or debarment. I get paid to ensure honesty and integrity in city government and contracting by rooting out fraud, abuse, waste and corruption.”

Dozens of subcontractors who attended the packed Tuesday hearing claimed Gayanga collectively owes them millions of dollars for unpaid work and secured city contracts while lacking required bonds. Marable said complaints from subcontractors are likely to be included in the active investigation.

Tuesday’s hearing was a test for Mayor-elect Mary Sheffield, who briefly dated McKinney and authorized millions of dollars in contracts for Gayanga. She presided over the hearing and voted to uphold the suspension but did not offer commentary on the suspension or question witnesses.

In a phone interview with BridgeDetroit ahead of Tuesday’s hearing, McKinney argued “the city is trying to shift the responsibility.” 

“If you told me where to go and when you use this material, then it comes back elevated, then this is on (the city), not us,” he said.

Perkins Law Group Attorney Adam Clements represented McKinney and Gayanga at Tuesday’s hearing along with Attorneys Aaron Burrell and Myles Baker of Dickinson Wright.

Clements argued the suspension has unfairly smeared the character of McKinney and his company while costing him business with the city. He also claimed McKinney was treated differently than other contractors that have been suspended by the city. 

Crucially, Clements argued all of the backfill material came from city-approved public sources, including Iron Horse, a backfill contractor that was also suspended. Clements said Iron Horse was chosen because it had the city’s stamp of approval and Gayanga had no responsibility to test the dirt on its own.

“None of the public sources really have any fidelity or integrity,” McKinney said in an interview. “We’re not building the same amount of housing we’re demolishing. This inversion of the amount of dirt going out and dirt coming in isn’t sustainable. I think these public sources have always been compromised.”

Marable said the investigation suggests backfill didn’t come solely from Iron Horse and information included on Gayanga reports to the city are incorrect.

“It is self-reporting,” Marable explained. “There’s no independent source of that. It is the honor system, and sometimes we have seen that people take advantage of that honor system, and that’s part and parcel of our investigation.”

The suspension was issued on Sept. 11 and lasts 90 days, or until Marable makes a final determination on whether to debar Gayanga and McKinney from working for the city for a long-term period.

Council Member Angela Whitfield-Calloway said Gayanga, “a small business that we’re proud of,” should still be paid for any work it completed for the city to ensure employees and subcontractors are paid.

City attorneys with the Law Department said the suspension won’t affect payment for approved work, which has likely happened already. Subcontractors who filled a committee room set up for Tuesday’s hearing said they already risk losing their business while waiting for Gayanga to pay them.

One-by-one, they painted McKinney as untrustworthy. Sheila Dapremont, principal of 3D Wrecking, said Gayanga tore up her equipment and declined to pay for damages.

A representative of City Abatement Services said McKinney owes them $611,000. Detroit Environmental Solutions Owner David Gillespie said he’s owed $350,000.

Mike Chaudhary, president and CEO of DMC Consultants, said it was well-known that McKinney was awarded contracts without providing performance and payment bonds that guarantees the contractor will complete the work as required and pay subcontractors. 

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What page are we on? 

Today’s notebook covers the Nov. 18  formal session. Next week is the last of this term. 

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Dig into the agenda, read Detroit Documenter notes or watch the recording for more details.

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Pending pay raise for clerk, council, mayor  

One of the last acts of City Council this year will likely be a vote on whether to raise their own salaries and hike the wages of the  City Clerk and mayor.

The Elected Officials Compensation Commission met in October and November to discuss salary adjustments and review pay at peer cities.

Data from the city’s Human Resources Department showed the mayor is earning more than the market average while the council is paid less and the clerk is significantly underpaid.

The commission recommended granting the mayor an immediate 5% salary increase, followed by another 5% increase in July 2026 and 3.5% increases in 2027 and 2028.

City Council members are up for an immediate 9% increase, followed by a 9% increase in 2026 and 3.5% increases in 2027 and 2028.

The commission recommended an immediate 19% salary increase for the City Clerk, plus a 19% increase scheduled in July 2026 and 3.5% increases in 2027 and 2028. The Clerk also receives $2,000 annually for serving on the Detroit Election Commission.

Clerk Janice Winfrey requested raising her salary from $106,233 to $150,000, a 29% pay increase. She argued clerks in other cities are being paid more despite having less responsibility, smaller staffs and fewer voters to oversee.

“The net effect of paying a competitive and fair wage for the full-time City Clerk position is that City will attract more qualified candidates seeking the position in the future, who are willing to stand in the gap to protect our unalienable constitutional right to vote,” Winfrey said in an Oct. 28 letter to the Elected Officials Compensation Commission.

Council Member Scott Benson advocated for raising salaries in an Oct. 22 letter, arguing the city’s leaders have stabilized Detroit’s finances and deserve a competitive wage.

“To ensure this momentum continues, the city must offer compensation packages that are competitive with similar positions in peer cities and equivalent executive roles in the public sector,” Benson wrote. “By approving a substantial and equitable increase for the mayor, City council and City Clerk, the Compensation Committee will be directly strengthening the long-term governance and financial health of our city.”

Benson referred decisions on the salary raises to the Planning and Economic Development Committee for further discussion. 

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Tactical preservation zoning approved   

The City Council unanimously adopted a zoning ordinance meant to expand redevelopment options for former public, civic and institutional buildings in residential districts. The vote came days after the council pumped the brakes on several zoning proposals that sought approval at the end of their term.

Council Member Gabriela Santiago-Romero asked to sponsor the “adaptive reuse and tactical preservation” ordinance, saying she supports measures to create more opportunity for redevelopment but doesn’t support a process that caused confusion about the multiple proposals.

Zoning changes approved on Tuesday allow for 50 new uses at former schools, libraries, churches, utility stations and other vacant institutional sites.

The uses are allowed on a conditional basis, which requires a special land use hearing at the Building, Safety Engineering and Environmental Department.  It also reduces parking and loading requirements by 50%. 

City planners said another ordinance meant to add housing density in residential areas isn’t being recommended for approval this year.

The “Let’s Build More Housing” proposal will be discussed in the new term starting in January. 

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Rivertown to vote on business improvement assessment  

Property owners along the Jefferson corridor will vote next year on whether to establish a fee that pays for security, trash cleanup and business marketing services.

The City Council authorized the creation of a Rivertown Business Improvement Zone pending the results of a Jan. 6 election by mail. Success requires approval from 60% of property owners within a district that largely includes properties along Jefferson Avenue from Rivard to East Grand Boulevard.

The tax deductible fee is calculated by adding 0.003 cents per $100,000 of assessed value and 0.058 cents per 8,000 square feet. Single-family residential properties won’t be charged.

Most property owners will pay under $3,000, said Jefferson East CEO Joshua Elling, while 43% will pay under $500 and 21% will pay $100 or less.

Elling said the Jefferson Corridor is growing and could benefit from additional security and mental health services, homeless outreach, wayfinding signs, and place-making investments.

Bedrock, Orleans Landing owner McCormack Salazar and Princeton Properties are expected to pay nearly half of the total assessment, based on their land holdings in the area. Other major contributors to the BIZ fund would include Pasadena Apartments, Aamir Farooqi, Dennis Kefallinos, Bob Maxey Ford and Jefferson Chevrolet.

Elling said he’s confident they have the votes needed. John Stroh, a longtime property owner in the area, said it’s a chance to equally distribute the cost of services everyone will benefit from.

Cassandra Neff is redeveloping a building into a business incubator on Jefferson that was vandalized soon after she bought it. She said a collective approach is needed to address problems.

Not all property owners are on board. Scott Turnbull, manager of Pasadena Apartments, said he would have no choice but to pass the fees on to tenants.

Brian Tellier, general manager of Jefferson Chevrolet, said the assessment is a “financial burden we cannot afford” when they already pay Detroit’s high property taxes, drainage fees, building inspections and business licenses.

Another Business Improvement Zone was created downtown and renewed recently by property owners. Gina Cavalier, executive director of the downtown BIZ, said funding private security is a key desire of stakeholders in Rivertown. 

The enhanced service is supported by Jefferson East, the Riverfront Conservancy, Rivertown Detroit Association and Downtown Detroit Partnership. The BIZ could also be rescinded by a future vote of property owners.

Editor’s note: An earlier version of this story misstated Gayanga’s position on Iron Horse as a sole source of contaminated backfill. Gayanga contends that the backfill was purchased from multiple city approved sources.