Red Wings arena deal faces critics / $650M proposal is subject of public hearing today amid city bankruptcy

Source: Louis Aguilar, Detroit News, September 5, 2013

The proposed Detroit Red Wings arena and a surrounding 45-block entertainment district near downtown faces a Detroit City Council public hearing today, amid criticism that the city is spending hundreds of millions on a joint venture with a billionaire while slashing the pensions of its own retired workers in bankruptcy court…. The stadium proposal won’t be affected by the bankruptcy filing because the deal is being run by Detroit’s Downtown Development Authority, an entity that is separate from the City of Detroit. The stadium project also will use tax dollars from a budget and revenue stream that is separate from the city’s general revenue fund, which is part of the bankruptcy case, supporters contend….

…The city’s Downtown Development Authority plans to use $284.5 million in property taxes captured from within its 615-acre downtown district to support part of the bonds. The rest will be picked up by Olympia Development, the property development arm of Mike and Marian Ilitch’s $2 billion business empire that includes the Red Wings, Detroit Tigers and Little Caesars pizza chain. The special tax capture has been in place for more than two decades and legally can’t be used for anything other than economic development. Olympia will operate the arena under a 35-year concession agreement with the Downtown Development Authority. The hockey arena is slated to be finished by 2017 and replace city-owned Joe Louis Arena….