Detroit council signs off on $20m in Pistons tax breaks, says worth it because it just is

The Detroit city council has approved $20 million in tax breaks for a Detroit Pistons practice facility, clearing the way for the team to move from suburban Auburn Hills to the new downtown Red Wings arena. Here’s how council president pro-tem George Cushingberry explained his reasoning:

“It seems to me that this deal is an $83 million deal and there is approximately $8 (million) to $10 million benefit to the residents of the city of Detroit, just in the first ten years of the tax abatement,” Cushingberry said. “So it’s certainly a benefit.”

(Yeah, no, I don’t get how $8-10 million in benefit would be worth $20 million in subsidies, either. Just go with it, it’s city councilmember math.)

The total cost of the Pistons share of subsidies would actually be $54.5 million, since there’s another $34.5 million in city bonding that still has to be approved by the council. The Detroit News has estimated that Detroit could earn that back via new “jock tax” revenues, which is maybe possible (jock taxes are notoriously hard to calculate because of accounting tricks players and performers can use to offset one state’s taxes against another’s), but in any case none of this would be happening without the more than $300 million that the state and city are giving to the Red Wings to build the arena. This is badly crying out for a better analysis than “the Pistons are spending $83 million on a practice facility, that’s a lot of zeroes!”, but it’s not looking like we’re going to get it.

Comments are closed.