Those long-amorphous plans for a new Detroit Red Wings arena suddenly got a whole lot more morphous yesterday, as the Michigan state senate voted to approve the use of tax dollars by the Downtown Development Authority toward any arena plan. Namely, the one that Red Wings owner Mike Ilitch announced on Tuesday, which would cost $650 million and include a mixed-use retail/housing/office development, and would be built, er, somewhere and be paid for somehow.
Ilitch and his senate allies have been playing up the “no new taxes” aspect of the DDA scheme, but of course old taxes are tax money too. The DDA funds are basically a TIF — they come from redirected property taxes in downtown that would otherwise go to city schools. This was a matter of some consternation yesterday to Senate Minority Leader Gretchen Whitmer, who complained, “For the first time in nearly two decades, the property taxes in Detroit were finally going to the right place, the schools. Now they’re swooping in on school taxes to help pay for a hockey arena in Detroit.”
Actually, from what I can tell, the DDA has already been using the money — currently running about $12.8 million a year, or enough to pay off about $150 million worth of arena — to pay off prior school debt, but now that that’s almost retired, apparently Ilitch figures the cash would make a nice down payment on his arena dream. The senate action doesn’t necessarily mean he’ll get it — the state house still has to vote on it, and then the DDA needs to work out an actual arena deal — but it’s certainly a great first step. Or a lousy first step, depending on your perspective.