While billionaire Pistons owner Tom Gores was demanding tens of millions of dollars in tax incentives from Detroit last month to move his basketball team to downtown, the 52-year-old spent $100 million on a newly built mansion in Los Angeles.
It was tied with the Playboy Mansion for the priciest residential sale in Los Angeles County history, with 10 bedrooms, 20 bathrooms mansion, three swimming pools, a massage room, and a 5,300-square-foot master bedroom suite.
Although Gores has a net worth of $3.3 billion, according to Forbes, he wants $34.5 million in captured taxes to move the highly profitable Pistons into the new Red Wings arena. Gores also is demanding that he not pay property taxes for his team’s new practice facility, which would rob the city and schools of up about $450,000 a year.
The Piston’s current home, the Palace of Auburn Hills, costs Gores $760,000 a year in property taxes. He won’t pay any property taxes at the Red Wings arena because it’s on land owned by the Detroit Downtown Development Authority.
Mayor Mike Duggan’s administration negotiated the deal behind closed doors, and both the local media and Pistons are erroneously suggesting the deal is sealed. Olympia Entertainment, which operates the new Red Wings arena, has posted banners and enormous photos of the Pistons around the facility.
But the tax incentives still need approval from the DDA and Detroit City Council, and mandatory public hearings are scheduled for March.
New studies have found that sports facilities are a poor use of tax dollars. President Obama barred the use of tax-exempt bonds for sports stadiums this year, and the Treasury Department concluded the bonds have “shifted more of the costs and risks from the private owners to local residents and taxpayers in general.”
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Steve Neavling lives and works in Detroit as an investigative journalist. His stories have uncovered corruption, led to arrests and reforms and prompted FBI investigations.