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Do They Care About Detroit's Future?

4 August 2004

Shortly after the voters of the State of Michigan approved the statewide referendum authorizing three casinos in the City of Detroit, state and City of Detroit leaders had the strong desire to (1) do things right and (2) not to repeat the mistakes made in New Orleans where a casino had recently gone bankrupt.

As a result, everyone involved in the process had a strong collective vision: A well-regulated casino gaming industry used as an economic revitalization tool to help spur further development in the City of Detroit. Surprising many, Detroit Mayor Dennis Archer came up with the concept of clustering all three casinos near the Detroit River and creating a riverfront rid of unsightly cement silos and filled by park land, entertainment facilities, retail shopping, office space and convention space all the way from the Belle Isle Bridge to Cobo Hall.

As too often occurs in the City of Detroit, the grand plans which would have made stunning progress in time for the Superbowl in 2006 got derailed by greed and lack of commitment. The individual property owners saw an opportunity to cash in, the leadership caved in to the voices of the critics, and the three casinos ended up spread throughout the City.

Along the way, the casinos have done all they promised, and more. They created jobs for people who had struggled to find work in the past. They created fun and exciting temporary facilities at astronomical costs to assure first-class facilities, and have been rewarded by the marketplace for doing so. They sank hundreds of millions of dollars into downtown investments, have contributed to enhancing the neighborhoods that they are in, and have created a ton of spin-off work for one of our most important industries – construction.

As I write this column, a new wave of greed further threatens the vision that the gaming and construction industries are working toward. This time the greed is not by any individual, but instead is a collective greed on the part of our state representatives who see an easy fix to the budget woes by increasing taxes on the Detroit casinos, and ultimately on those who wager. This greed threatens jobs, plain and simple, and in the long run, is a big threat to the economic revitalization of the City of Detroit. With increasing competition and savvy casino customers, the City will lose casino customers if the taxes are increased. More and more of these customers will go elsewhere, to Tribal casinos, Pennsylvania, Indiana, and Illinois facilities, and the blossoming, new life that has started in downtown Detroit will wither on the vine.

To me, the most amazing aspect of this ill-advised tax increase proposal is the widespread support it has among "Reagan Republicans." Ronald Reagan stood for and believed that diminished government and lower taxes would create economic revitalization. By supporting higher taxes these representatives are harming the only new industry that has provided replacement revenue for the revenue sharing from the state that was lost through legislative actions in the past.

Do they care about the City of Detroit? Do they truly believe, as Ronald Reagan did, that higher taxes are harmful to the economy? Their votes will tell.

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