Less than a month ago, developers of the $1.5 billion District Detroit project and community representatives celebrated the signing of the largest community benefits deal in Detroit’s history.
The praise came quickly from one of the developers, Olympia Development of Michigan, which called the work “wonderful.”
And from the group of people negotiating on behalf of the neighborhood, “Nothing like this has been negotiated with projects of this magnitude in the history of this city,” Chair of the Neighborhood Advisory Council (NAC) Chris Jackson told BridgeDetroit.
Almost immediately, however, supporters of the agreement were drowned out by criticism and anger that the NAC didn’t get more from the billionaire developers.
City Council was scheduled to vote on approving the benefits agreement earlier this week but pushed the vote back after more than two hours of public comment. The vast majority of speakers were opposed to the agreement and to public subsidies for District Detroit.
“It was like, ‘Here’s 1,000 pages of documents. See you next week.’ We didn’t even have an orientation that would have allowed us to truly understand what a community benefits agreement is.”
Halima Cassells, member of the Neighborhood Advisory Council for the Fisher Body Plant development
At the meeting, Detroiters criticized the deal as another example of what’s wrong with the community benefits process in the city. They say the NAC didn’t get nearly as much as they could. The developers have asked for nearly $800 million in public funding.
“It’s not that the city doesn’t want good outcomes, but they want an efficient process, and they want a deal,” said Francis Grunow, a member of the Neighborhood Advisory Committee for Little Caesars Arena.
And the rush to get agreements signed creates an unfair playing field, Grunow said.
“There’s not enough time or training at the front end to prepare people for what are pretty complicated deals.”
What’s a good deal?
The community benefits process is mandatory for all developers of Detroit projects that will cost more than $75 million to develop and get more than $1 million in subsidies from the city. The process requires the city to facilitate a series of public meetings and create a nine-member NAC tasked with negotiating an agreement that both sides sign. The whole process usually takes eight weeks.
The District Detroit agreement had the developers, Related Cos. and Olympia Development, agree to spend $12 million on things like renovating the Cass Tech football field ($1 million), a retail tenant improvement fund for disadvantaged Detroit businesses ($1 million) and year-round “placemaking” along the Columbia Street plaza ($2.5 million).
The developers said they will also put $100 million of the project’s budget into hiring minority and Detroit-based contractors.
Linda Campbell with the racial and economic justice advocacy group Detroit People’s Platform called the District Detroit agreement a “very bad deal.”
“You’re going to bring higher-end luxury apartments into the neighborhood, and it’s going to displace folks in our community,” Campbell said. “So why wouldn’t you mitigate that?”
Campbell thinks the whole process was doomed from the beginning because those appointed to the NAC were aligned with business interests more than residents.
“You had political operatives, elected officials, developers, businesspeople,” Campbell said. “Those aren’t always aligned with the priorities of the community.”
The NAC chair was Chris Jackson, co-principal and managing partner of the development firm Queen Lillian, and other members included Wayne County Commissioner Jonathan Kinloch and Michael Essian II, vice president of American Community Developers. Several had served on previous NACs.
Kinloch objected to the idea that he or other members of the NAC were on the side of the developers.
“Folks seem to forget we’re residents here, too,” he said. “This document represents a culmination of ideas that came from residents, from a dialogue and conversation made in public.”
He also thought there was plenty in the agreement that supports low-income renters, including the rights of tenants in affordable units to renew their leases, acceptance of Section 8 voucher holders and a 50% discount on parking to tenants in affordable units.
Set up to fail
The District Detroit deal is not the first time the community benefits ordinance has been criticized in its short life. The rule has been contentious since it went on the books in 2016. Activists wanted more then, and still regularly decry the lack of direct representation on NACs, the way some developments are able to avoid triggering the ordinance in the first place, and the lack of strong enforcement if developers don’t deliver on their promises.
Halima Cassells was a member of the NAC for the proposed Fisher Body Plant development. Those negotiations went on last spring.
Cassells, a lifelong Detroiter who lives near Fisher Body, said the community was never properly set up to negotiate on an even footing with the developers.
“It was like, ‘Here’s 1,000 pages of documents. See you next week,’” Cassells said. “We didn’t even have an orientation that would have allowed us to truly understand what a community benefits agreement is.”
She said the city strongly encouraged the NAC to come to an agreement at the end of eight weeks, which wasn’t enough time.
“There’s a ton of pressure,” Cassels said. “The city kept saying, ‘We’ve got to get this done, we’ve got to get this done.’ Who said that? ‘Oh, the developer.’ But aren’t you supposed to work for us?”
She was deeply disappointed at the end of the process. The final signed agreement requires developers to give $500,000 to a community fund and reserve just three units of 433 for renters who make 50% of the area median income.
Richard Hosey, one of the project’s co-developers, did not respond to emails in time for publication.
For its part, Olympia Development also said there’s a reason the community benefits process should move quickly. Ed Saenz, Olympia’s director of communications, wrote by email that residents benefit when these agreements are signed in a timely manner.
“It is more about the impact to the City and the Community,” he said. “The sooner the projects get going the sooner the city realizes new revenue and the other benefits.”
A national perspective
John Goldstein has been organizing community groups to advocate for benefits for more than three decades. He lives in New Jersey and consults with groups around the country, though not in Detroit. Goldstein said all members of NACs, not just a few, should be directly voted on by residents.
“Politicians should not be picking representatives,” Goldstein said. “The community benefits model should disrupt the traditional development process, but that only happens if there’s direct negotiation between the community and developers.”
In Detroit, only two NAC members are voted on by residents. The other seven are nominated by the city’s Planning and Development Department and City Council.
He also said that developers should be asking residents about their priorities near the start of development planning, not at the end.
“It’s funny to me when a developer says they need to get an agreement done in six weeks,” he said. “By the time a project gets to the community benefits process, there’s already been one to three years of discussion. To me, it says the process has to start much, much earlier, before a developer has a fixed idea of what they’re going to do.”
Goldstein has documented 350 community benefits campaigns in 80 cities and said that none have been “perfect.” But he did point to an ordinance in Somerville, Massachusetts that requires developers of large-scale projects to negotiate with a neighborhood council chosen by residents and contribute to a fund that distributes dollars to neighborhood needs.
In 2021, Detroit City Council came close to revising the Community Benefits Ordinance by lowering the threshold to $50 million for projects to participate in a community benefits process, among other changes. It was voted down 5-3.
With six new councilmembers, advocates hope the process around the community benefits ordinance will be improved.
Any amendments to the ordinance are likely to come from the council’s newly created Equitable Development Task Force. Councilmember Gabriela Santiago-Romero co-chairs the task force. Her office’s communications manager, Thomas Rogers, said the task force is considering changes to the ordinance, but didn’t provide a timeline.
Campbell of Detroit People’s Platform wants any development large enough to trigger the ordinance to have to assess its impact on the environment, on housing affordability and disparate impacts on people of color.
Even without change, she thinks NAC members can better wield their authority. She wants them to push for more time and negotiate harder.
“Even with all its shortcomings, the NACs do have some power,” she said. “They just have to use it.”
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