The map of Detroit redevelopment would look very different today had Gov. Rick Snyder’s proposal to eliminate brownfield and other tax credits become a reality several years ago.
Since 2000, the city has approved nearly 200 projects large and small using brownfield redevelopment tax-credit financing. Among them are some of the city’s jewels: the Westin Book Cadillac hotel, the Doubletree Fort Shelby hotel and the former Argonaut Building that now serves as the College for Creative Studies A. Alfred Taubman Center for Design Education.
Beyond those headline-grabbers, many small retail, residential and commercial projects have been built or are in the planning stages using tax-credit financing, said Dave Blaszkiewicz, president of InvestDetroit, a nonprofit loan fund that helps bankroll Detroit redevelopment.
“This effectively puts a stop to everything that we have on the drawing boards that’s not already committed to in writing by the state,” Blaszkiewicz said last week.
Meeting with the Free Press editorial board Friday, Snyder defended his proposals. “We need to cut back on these tax credits. They were being overused dramatically,” he said, estimating that tax credits in general will cost the state $2 billion through 2015 and $500 million in the 2013 budget alone.
“We need to turn the psychology around to say it’s about having a better tax rate, a better business climate,” he continued. “People need to look at how they do things, and I believe there are opportunities to still have good growth in Detroit.”
It’s possible that over time, developers and other deal-makers will come up with a new financing tool. Blaszkiewicz said he and other Detroit backers would work for that. But, for the moment, they were reporting shock and dismay over Snyder’s proposal.
“It’s really like cutting your leg off while you’re halfway up the hill,” said Fred Beal, a contractor and investor in the Broderick Tower renovation project in downtown Detroit.