Court rules Detroit can spend tax money on Red Wings arena, because they already pinky-swore

A federal judge has refused to impose an emergency injunction against Detroit using tax money to pay off construction debt for the new Red Wings and Pistons arena without a public vote, on the grounds of “OMG won’t anyone think of the city’s bond rating?!?”

In his opinion, federal Judge Mark Goldsmith said the plaintiffs ultimately failed to establish why an emergency injunction was needed.

“The loss of  anticipated commercial activity connected to the Detroit Piston’s downtown presence would be regrettable, but the loss of the city’s hard-won creditworthiness caused by defaulting on existing bond obligations would do catastrophic damage to the status quo,” Goldsmith said.

This is, needless to say, a dangerous precedent, since it would mean that cities could go ahead and sell bonds without being sure they’re legally allowed to pay them off, figuring that no one will stop them after the fact for fear of harming the city’s credit rating. (Which cities are already doing, of course.)

The plaintiffs can still continue with the court case, and have indicated that they will — as well as filing a state court action to stop the Detroit city council from approving funding for the Pistons’ practice facility, as it is expected to do today — but if the courts keep ruling, “Too late, the getaway car has already left and it would be too much of a mess to chase it down now,” it’s hard to see how court challenges will do any better down the road. There’s a long tradition of this kind of thing in Michigan — the Tigers‘ new stadium was funded in part by the governor funneling off state money without legislative approval and courts later ruling, “Enh, water under the bridge” — but that doesn’t make it any less disturbing when courts rule not on the basis of the law but on the basis of who will be most inconvenienced.


One comment on “Court rules Detroit can spend tax money on Red Wings arena, because they already pinky-swore

  1. And, on a related note, here’s a report, hot off the presses, from 24/7 Wall Street ranking Detroit as THE worst city to live in the nation.

    http://247wallst.com/special-report/2017/06/16/50-worst-cities-to-live-in/

    But I’m sure once LC Arena opens, as well as any related facilities for the Pistons moving back downtown, the rankings will reflect that and Detroit will be off the list in no time.

    The Detroit “comeback”, now in it’s 50th year, continues.

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