Detroit City Council approves $34.5M subsidy to billionaire Pistons owner

Pistons banner on the site of the new Red Wings arena. Photo by Steve Neavling.

Ignoring a groundswell of opposition to corporate welfare to sports owners, the Detroit City Council on Tuesday approved a $34.5 million tax subsidy to billionaire Pistons owner Tom Gores to move the basketball team to the new Red Wings arena.

The 7-2 vote, which came without council discussion, was unusual since Gores has little choice but to move the team from Auburn Hills to Detroit since the Pistons already sold season tickets, spent tens of thousands of dollars on promotions and held a celebration for its final game at the Palace of Auburn Hills.

Motor City Muckraker revealed Tuesday that the city council violated state law by taking secret round-robin votes on whether to provide the subsidy. Behind closed doors, council members assured Mayor Duggan and Gores months ago that there were enough votes to approve the subsidy.

Brenda Jones and Raquel Castaneda-Lopez voted against the subsidy. 

John C. Mozena, vice president of marketing and communications for the fiscally conservative Mackinac Center for Public Policy, said subsidies to team owners “are an ineffective form of corporate welfare.”

“It will not improve the lives of Detroiters,” Mozena said, adding that sports subsidies “just shift where and when entertainment dollars are spent”

Earlier this month, seven of the nine council members approved $20 million in brownfield tax credits for Gores to build a practice facility for which he does not have to pay property taxes, even though Gores refused to guarantee a single job to Detroiters. 

During the public comment period, one resident said, “The city is ignoring the neighborhoods.”

In April 2015, the city council also approved $150 million in tax incentives for Mike Ilitch to build the Red Wings arena.

The DDA will continue capturing tax dollars that could be used to pay for city services until the bonds are paid off decades from now.

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Steve Neavling

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.