Detroit City FC Stadium Financing Unveiled to Neighborhood Advisory Council

The Detroit City Football Club has applied for $88 million in tax breaks as it pushes forward with plans to build a stadium, parking garage and housing on the site of a closed hospital in Southwest Detroit.

The three tax abatements are split between offsetting the cost of the housing and parking garage portion of the $150 million development, razing the hospital and rehabilitation of the brownfield upon which the project will be built on Michigan Avenue and 20th Street. If approved, the tax breaks will be in effect for up to 30 years.

Detroit Economic Growth Corporation officials said the project will net the city more than $14 million in personal and property taxes and an additional $745.7 million in visitor spending during that time. The club will pay property taxes on the stadium. DEGC officials understand that the tax breaks are a big request but realize the blighted hospital needs to come down and the city doesn’t have large amounts of space without environmental issues available for redevelopment.

“Auburn Hills has greenfields. Detroit has brownfields,” said DEGC Vice President of Real Estate and Development Services David Howell. “We are competing in some cases with cities for developments and jobs that don’t have the same issues.”

Club officials said they are accepting no direct funding. Howell confirmed this and said none of the tax breaks, if approved, will be awarded until the project is completed. In addition, the club had to show that it could generate at least $1.20 in revenue for every dollar of debt it incurs for the project. The club was able to show $1.27, Howell said

“We are not just handing out cash,” he said. “If this goes sideways …(club cofounder) Sean Mann and his partners are on the hook. Sean is not doing this to move away. He is investing in the city.”

The 15,000-seat stadium is expected to drive new development in the area and be a link between the city’s Corktown and Mexicantown areas. The stadium site is in an area with at least 5,000 residents who will be affected by increased traffic, visitors and need for parking on game days or if concerts are held at the stadium.

Mann and at least another cofounder live within walking distance of the project and also will feel the impact and the wrath of neighbors not happy about the disruptions. But Mann said the club is trying its best to be transparent about the plans.

“People will see me walking my dog,” he said. “We live in the community.” The project is expected to generate 1,000 construction jobs. Mann said the club will follow city regulations that stipulate that the majority of workers be people of color and residents of Detroit. He will hire about 100 fulltime workers at the stadium and the majority will be city residents.

If nothing was done in the area of the stadium, it would generate about $2 million for the city over 30 years. The hospital had contaminated water in the basement that needed to be cleared and cleaned before demolition could begin. The site was not ideal and officials said the stadium founders using private funding to pay for the project is a boon.

The tax breaks are being sought under a city ordinance that requires community input, a Neighborhood Advisory Council (NAC) and other requirements in order to apply for the abatements. Three meetings have been held and more are scheduled through October on Thursday evenings at the Mexicantown Mercado. The NAC will have the ability to speak directly with club officials about issues such as adequate or noise concerns. Those concerns will have to be addressed in order to obtain the tax relief.

There are nine NAC members and one nonvoting alternate. Two NAC members were elected by residents in the affected area near the stadium project, three were appointed by the Detroit City Council and four by the city’s planning department.

The next meeting is at 6 p.m. on Sept. 25 and will be a working meeting of the NAC. The NAC can be emailed at dcfcnac@gmail.com.