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Add Cooperation, Compromise to Detroit Political Vocabulary

12 June 2002

Detroit's city government has offered up a good example of how quickly things can go from promising to sour. Only five and a half months ago the newly elected mayor was eager to get to work with the City Council. The youngest mayor in Detroit's history was known during his time as a state legislator as one who could bring people together to get things accomplished. It seemed a promising step in the right direction to have a 31-year-old, fresh-faced, energetic mayor who was ready to tackle the city's issues and start the process of re-establishing Detroit. It also appeared that he would be a coalition builder, and would be respectful of the vital role City Council has in city government. At that time, it looked as if Mayor Kilpatrick and the City Council were going to work together in the best interests of the residents of Detroit. It looked as if the city might see some rapid political progress and that compromising and cooperation might actually be added to the vocabulary of Detroit's local political scene. Now, however, a mere five and half months later, it looks as if the Mayor and City Council have arrived at an ugly impasse. If the two sides cannot come together soon, the entire administration -- both City Council and the Mayor's office -- may be viewed as a lost cause, and the City of Detroit will once again be the innocent victim of politics.

Not long after he took office, Mayor Kwame Kilpatrick vowed to address the looming casino issue in Detroit, citing that he wanted to "move on to other issues that Detroiters want." Within the first 75 days of his term, he broadly outlined some concepts for amendments to the Casino Development Agreements for the City Council to take into consideration. The new Mayor had negotiated with MGM Grand Detroit Casino, MotorCity Casino and Greektown Casino finalizing plans that would quickly bring permanent casinos to downtown Detroit. The deals would have required the casinos to each: construct a 400-room hotel; uphold the construction of features agreed to in their original Agreements such as restaurants, bars, retail, theaters, ballrooms and convention centers; and, forgive a $50 million debt the city owes each casino as a result of credit the casinos issued to buy the Riverfront property. Further, the casinos were required to: pay the city $34 million in two equal installments; transfer ownership of the 42.5 acres of land purchased for the proposed Riverfront site to Detroit; and, waive the 'most favored nations' tie-bar in the Agreements with the city that requires all three casinos to approve amendments to the others' Development Agreement. On March 27, 2002, after leaving a two-hour closed door meeting with Mayor Kilpatrick and city lawyers who outlined the Mayor's Casino Development Agreements, Council member Kay Everett called the meeting, "A historic day in the City of Detroit."

Shortly thereafter, however, City Council collectively decided that it needed time to study the actual amendments to the Agreements and closely scrutinize them. After waiting for the Mayor to supply more details and present the amendments to them, City Council rejected the proposed amendments, citing the desire for a loan fund for Detroit minority businesses among other things. The City Council told Mayor Kilpatrick to go back to the negotiating table. After Council approved an amendment that extended the permanent casino deadline by 30-days, Mayor Kilpatrick did as the Council asked and began the second round of negotiations with the three casinos. The Mayor's second-round negotiations with the casinos did sweeten the deal for Detroit and yielded an increase in City benefits. The casinos each agreed to pay an additional $10 million within nine months on top of the $34 million-over-two-years that each had already agreed to pay. Each casino also agreed to pay another $10 million to an existing community development loan program run by minority-owned First Independence Bank. The money would be used for loans and grants to start businesses in Detroit. Further, Mayor Kilpatrick convinced the casinos to contribute another $30 million that would be utilized in various ways throughout the City.

Despite these new concessions, the City Council once again rejected the amendments to the Agreements. This time, however, Mayor Kilpatrick responded that he would not re-negotiate the deals and pointed the finger back at the City Council. After the second set of amendments were rejected by the City Council, Mayor Kilpatrick noted what is at stake concerning the rejection of the casino deals. The list included $500 million the city would receive, 9,000 jobs, $2 billion in Riverfront investment and many opportunities for trade workers, construction and so on.

At the same time as these discussions have been taking place, there has also been a battle over the possibility of City Council members being elected by district, rather than at large. The State Legislature passed a Bill and the Governor signed into law a State Act placing the issue on the August 6th primary ballot. City Council members felt that the Mayor should have assisted their efforts to keep Lansing from meddling in Detroit's business. They were offended by the Mayor's endorsement of the districting concept, even though he claimed he was not in favor of passage of the Bill placing the issue on the ballot. Unfortunately, this political battle has created a great deal of mistrust between the legislative branch of City government (Council) and the executive branch (Mayor).

There is much to be accomplished in Detroit and much to look forward to, but until the Mayor and the City Council learn to communicate, cooperate and compromise, Detroit may not be afforded the opportunity to forge forward. Until then the real losers in the ongoing battle are the citizens of the City of Detroit.

The casino gaming industry holds terrific promise for Detroit's future, much of which will not be realized until the permanent facilities are built. Detroit has a real opportunity to shed its current national image and to reestablish itself in the national spotlight with the Super Bowl coming in 2006. To accomplish this, Detroit's public officials must show true leadership. True leadership requires honesty, trustworthiness, and a willingness to put aside petty political battles for a greater good. For starters, it requires communication. It also involves respecting differences of opinion and learning to be united for the cause of improving the City, even when leaders may be divided on other issues. Both sides need to talk and listen, and in the interests of the City, both sides need to lead, and follow. Only then will Detroit make the necessary progress to achieve its renewal.

David Waddell
David Waddell is an attorney for Regulatory Management Counselors, P.C. (RMC), which assists businesses in navigating the legislative, regulatory and licensing systems governing Michigan’s commercial and tribal casino industries. He is the co-author of The State of Michigan Gaming Law Legal Resource Book and one of the founders of The Michigan Gaming Newsletter.

David Waddell Websites:

www.michigangaming.com
David Waddell
David Waddell is an attorney for Regulatory Management Counselors, P.C. (RMC), which assists businesses in navigating the legislative, regulatory and licensing systems governing Michigan’s commercial and tribal casino industries. He is the co-author of The State of Michigan Gaming Law Legal Resource Book and one of the founders of The Michigan Gaming Newsletter.

David Waddell Websites:

www.michigangaming.com