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Hilfinger points out that Ilitch has also pledged $200 million toward the “ancillary development” that’s part of the entertainment complex — and some unspecified amount of (currently worthless) downtown property he’s been sitting on. When everything is added, Ilitch’s contribution will add up to 56 percent and taxpayer contribution 44 percent, Hilfinger says.
But there are at least two big problems with this claim.
One: This “ancillary development” won’t begin for several years. Should the downtown show few signs of revival after the arena goes up, it is hard to see how authorities could insist that Ilitch and other investors continue to sink money into it, even though Hilfinger says they’ll be contractually required to do so.
The bigger problem is that whatever Ilitch “contributes” — parking structures, retail, office space — he’ll own and exclusively profit from. It is a verbal gimmick to dub this a “contribution” — as if it were an act of charity. The deal, in other words, forces taxpayers to assume all the risk even as Ilitch gains monopoly rights to virtually all of the revenues.
Detroit is in bankruptcy because special interests — whether Big Labor or Big Business — have diverted its resources to service their — not general resident — needs. The new Red Wings arena suggests that bankruptcy has changed nothing.
A version of the column originally appeared in the Washington Examiner.