Detroit City Council postpones $60M tax break vote for Hudson's project again
Detroit City Council again postponed a vote that could have cleared the way for Dan Gilbert to capture $60 million in tax breaks for his Hudson's site project.
Council President Mary Sheffield requested holding off until next Tuesday to allow council members to digest details of the request and solidify in writing some of the commitments Gilbert may have expressed.
There were no objections from other council members to the postponement.
Officials were expected to vote on the tax break last week but postponed after heavy opposition from residents who said they wanted to see taxes used on schools, libraries and neighborhoods to develop communities. Others supporting the abatement said it would help Detroiters find jobs and benefit the city in the future.
More: In face of opposition, Detroit City Council delays $60M tax break vote for Hudson project
Gilbert's real estate firm, Bedrock, has said the abatement is a critical component of its debt financing for its Hudson's site project. Bedrock claims the project's costs have soared to $1.4 billion, up from $909 million five years ago.
The skyscraper would be Detroit's second-tallest tower after the Renaissance Center. Its two components include a 12-story midrise building with more than 500,000 square feet of office and events space, and a skinnier 49-story tower with a 225-room hotel and about 100 luxury condos or apartments on the upper floors.
More than half of the council members received thousands in campaign contributions from Gilbert's Rock Holdings PAC, the Free Press reported earlier. Some members who responded said campaign contributions do not influence votes.
More: Detroit officials who will decide Gilbert tax break got major campaign contributions
Bedrock says the requested abatement was anticipated back in 2017 when the project broke ground. But officials could not apply for the abatement until now due to several design changes during construction.
Known as the Commercial Rehabilitation Act, PA 210, the tax abatement is a common one for large Detroit developments. It would freeze property taxes that typically go to the city’s schools, libraries and Wayne County educational entities. Because the project is located downtown, taxes are instead captured by the Downtown Development Authority.
The authority generally uses its captured taxes to help finance economic development projects, such as construction of Little Caesars Arena. Once the structure is built and the requested abatement kicks in, the site would generate $2.6 million annually. After 10 years, when the tax freeze expires, the taxes would rise up to about $10 million a year.
"The proposed tax abatement doesn’t take any revenue from city services, schools or the library," Gilbert's top lobbyist Jared Fleisher previously told the Free Press. "It only takes money from the DDA and other downtown projects."
Free Press staffers JC Reindl and M.L. Elrick contributed to this report.
Dana Afana is the Detroit city hall reporter for the Free Press. Contact Dana: dafana@freepress.com or 313-635-3491. Follow her on Twitter: @DanaAfana.
This article originally appeared on Detroit Free Press: Detroit city council postpones $60M tax break vote again
