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A Lesson in Community Activism: How the Detroit Community is Protecting its Past and its Future

 


 

Background

Detroit is home to the Michigan Fairgrounds, where the Michigan State Fair, one of the oldest state fairs in the country, was held since 1905.[1] However in 2009, amid economic hardship, the Michigan government eliminated funding for the fair, and it was discontinued at that location (a privately-funded version of the fair is held elsewhere).[2]

While there hasn’t been a state fair at the site since then, the fairgrounds have been a topic of controversy for some time. Without the state fair, the essentially vacant land has gone mostly unused (not counting 16-acres sold to a real estate development agency owned by Magic Johnson or the portion used as a COVID testing site).[3] While mostly empty, the storied land still houses a number of historic buildings, including the Michigan State Fair Riding Coliseum, the Dairy Cattle Building, and the Agricultural Building.[4]


The great abandoned Michigan State fair Coliseum

Key Stakeholders

In 2012 the State Fairgrounds Development Coalition (SFDC), a grassroots community organization, was formed with the hopes of transforming the former fairgrounds. According to the SFDC website, the group “bring[s] together diverse voices in Detroit, the tri-county region, and the State, in support of METAexpo - residents, neighborhood groups, non-profits, entrepreneurs, business associations, civic leaders, union members, urban farmers, and more.”[5]

The METAexpo envisions a modern transit and economic development at the fairgrounds. This includes creating new jobs, providing public transit to access jobs, preserving the cultural and historical heritage of the state fair, ensuring a sustainable development, and creating a walkable “Main Street” with local businesses and fair housing.[6]

 

The Amazon Deal

In August 2020, Detroit Mayor Mike Duggan announced that 142-acres of the fairgrounds were being sold to private developers, Sterling Group (based in Detroit) and Hillwood Enterprises LP (based in Houston), for $9 million. [7] Amazon agreed to lease 78 of those acres in order to build a $400 million, 3.8 million square-foot distribution center.[8] In a press release, Mayor Duggan said the plan would create 1,200 new jobs.[9] In October, the Detroit City Council approved the sale in a 6-2 vote. Under the terms of the agreement, the private developers are required to hire Detroit residents for 51% of construction work hours or they would be subject to fines.[10]

The developers would also pay $7 million to the City to construct a new transit center, replacing the existing one. Detroit would get $16 million total in proceeds from the sale. Of those proceeds, $1.2 million would be contributed to the Affordable Housing Development and Preservation Fund. The rest goes to the transit center and other costs incurred by the City, such as payments related to the purchase of the fairgrounds property from the state.[11]

What about the historic buildings? They will likely be demolished during the construction of Amazon’s warehouse. However, the City resolves to “allow a 3-month feasibility study of the Dairy Cattle Building and Hertel Coliseum enabling advocates, the City PDD and DBA to evaluate potential reuse or relocation of those buildings.”[12] However, it is questionable how seriously the developers would consider any proposals.

 

Community Benefits Ordinance

The project is said to be taking no tax breaks or public subsidies. This is one of the main points of contention between the City and the SFDC. The City claims that since there are no tax breaks associated with the project, it is not subject to the Community Benefits Ordinance (CBO).

The CBO is a law passed in 2016, which requires developers of certain projects in Detroit to “engage with the community to identify community benefits and address potential negative impacts of certain development projects.”[13] This includes establishing a Neighborhood Advisory Council to work with the developer to establish community benefits that would be a part of the final agreement approved by the Detroit City Council. The CBO applies when a development project is $75 million or more in value, receives $1 million or more in property tax abatement, or receives $1 million or more in value of city land sale or transfer.[14]

 

Community Pushback

The SFDC disagrees with the City’s determination that the CBO does not apply to this project. According to the group, while the developers are not taking tax breaks, they are taking “backdoor subsidies” of almost $3.6 million by deducting demolition and environmental costs from the purchase price.[15] The plan details show that the developers are in fact paying for the cost of any demolition, environmental remediation and construction of the facility.[16] The SDFC also argues that the City undervalued the land by $3 million and has pointed to complaints about Amazon generally, such as unsafe working conditions, particularly at the Amazon facility in Romulus.[17]

On October 21st, the SFDC filed a lawsuit to stop the sale of the fairgrounds for an Amazon distribution center.[18] The lawsuit claims that because the City sold the land for less than it’s worth, the sale is subject to the CBO, and the developers were obligated to negotiate benefits packages with the community.[19]  On October 28th, the Wayne County Circuit Court issued a temporary restraining order prohibiting the sale.[20] A hearing was scheduled for November 9th, in which the City of Detroit would have to show why a preliminary injunction should not be issued by the court.[21] Unfortunately, on November 3rd, the Court of Appeals reversed the restraining order and canceled the hearing.[22]

Lessons for Community Leaders

There are a number of reasons why this deal is cause for concern. The co-chairs of the SFDC, Karen and Frank Hammer, both learned of the Amazon deal only the day before Mayor Duggan announced it in a press release. The City did not reach out to the community to include them in any of the conversations with the private developers. [23] While troubling, this story is not unique – a big business, supported by politicians, coming in and claiming it knows what is best for the community, while not even involving community members in the process. This is in direct conflict with values of community integrity and self-determination. The community of Detroit, as represented by the SFDC, is saying this is not what is in their best interest. While it is both a frustrating and disheartening story, it is also one that shows the power of collective community action. This is what should be the main take-away.

This grassroots organization was able to get an injunction to stop the development that they saw as a threat to their home. Although the court ruling was reversed, this can still be a lesson and perhaps a glimmer of hope for other community leaders in similar positions, trying to protect their communities from big businesses not looking out for their interests. When community members come together to advocate for themselves, real change can be effected. The political and structural power dynamics at play are hard to fight, but the story does not have to end there. There is power in organizing a diverse set of community members, as the SFDC did, and advocating for their legal rights. While it remains to be seen what is to come of the deal, at the very least other community leaders can be inspired by what the SFDC has done to protect the Detroit community and feel motivated to construct a similar model in their own communities.

  By: Chloe Schwarz 


[2] See Footnote 1

[3] See Footnote 1

[10] See Footnote 7

[11] See Footnote 7

[14] See Footnote 13

[15] See Footnote 7

[16] See Footnote 12

[19] See Footnote 18

[21] See Footnote 20

[23] See Footnote 17

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