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Thursday, November 21, 2013

Diversification opportunity - Boeing

With a USD 100 bn in orders for this new plane, Governor Rick Snyder, Detroit, and Michigan should be pursuing this opportunity very hard. Glad (and a bit surprised) to see my Congressman on the ball for this one. Aerospace would be a great complement to our existing industry and help suppliers diversify from automotive cycles. Plus, Boeing was from Detroit, Michigan to begin with. To top it all, we are actually a right to work state at the moment. Amazing. Not sure if we can use the Dubai-Detroit sister city aspect on this one though, unfortuately.
Chances like this don't come around very often. Hopefully, local leaders will realize the opening and seize the opportunity.

Here is Free Press coverage of Congressman Bentivolio's pitch:

Monday, September 30, 2013

Motivations and biases - Detroit art appraisal

Nolan Finley wrote in the News over the weekend that he's had some conversations with Detroit officials leading him to believe that the DIA will certainly be "monetized". The target number he was throwing around is $500 million to somehow be extracted from the DIA's assets. He mentioned that if the auctioneers value the collection at $3-4 billion, the DIA is probably safe, but the higher the valuation, the more likely the DIA will be raided.

I agree with the last statement, though this brings into question the objectivity of the auction houses in their assessments. Unless they have signed an agreement indicating that they would not participate in any auctions of DIA art, they would seem to have an inherent incentive/motivation to inflate the value of any art they appraise, as it would increase the chances that some art would be "monetized" and that they could earn a commission on such "monetization." Certainly, the auctioneers cannot be seen as independent/objective appraisers of art without such a clause. 

Sunday, July 21, 2013

Detroit bankruptcy: We hope for better things. It will arise from the ashes.

Well, we've finally made it - bankruptcy. Detroit has essentially been bankrupt for years, but last week, EM Kevyn Orr finally made it official with Governor Snyder's blessing.

What caused it?

Too many factors to count, and well-known ones at that. Race riots. Declining tax base. White flight. Contracting auto industry. Urban sprawl. Corruption. Mismanagement. Regional antagonism. State turmoil and falling revenue sharing. Crime.

What does it mean?

Detroit stopped functioning properly years ago, so from that standpoint, bankruptcy changes nothing in the short term. However, now, we will have the chance to invest in improving services rather than servicing the debt.

On a positive note, the City will have some time to breathe, plan, consolidate, and re-invest. It is entering with a plan, which is also good. I was relatively pleased with Orr's preliminary plan, and if Detroit is able to emerge from Chapter 9 on that basis, it should result in a stronger City.

On a negative note, of course, Detroit's pensioners are at risk. This is very unfortunate, and I'm not sure what the best workaround would be. There are no good answers. Perhaps, to at least make sure each one of them gets one of Detroit's abandoned homes as a potential rental property or something. I'm less sympathetic to the bondholders. Those assets are often sound numerous times after initial issue, and if someone has bought them within the past 5-10 years, they probably bought the junk bonds at a steep discount anyways, factoring in a likely Detroit default. To say nothing of the fact that they probably insured their investment anyways.

Then there are the variables. Orr's initial plan does not include liquidation of Belle Isle or the DIA. However, in federal court, anything is possible. If Detroit has to sell its jewels to private hands in a fire sale, all of us lose, and Detroit would be a less desirable destination, and less likely to recover long term. At least, in Chapter 9, the City cannot be forced to sell anything. Perhaps there will be an opportunity for the State to step in as needed and "rescue" such jewels temporarily in exchange for a cash injection (see previous post).

It is a new day in Detroit. Things are not yet different, but for the first time in a long time, it seems like they can't get worse at City Hall, but only better. We hope for better things. It will arise from the ashes.

Monday, June 3, 2013

State solution to DIA threat?

In the past week or so, it has come out that Emergency Manager Kevyn Orr is looking at liquidating the (significant) city-owned elements of the DIA to help pay for some of Detroit's outstanding bills. Now, perhaps it is the right thing to consider as someone simply trying to balance the books. In any case, Mr. Orr perhaps believes he is fulfilling some kind of fiduciary duty. However, stripping the DIA would be a tremendous mistake and blow to Detroit's revitalization. We are trying to save the city, not accelerate its demise. The choice between preserving our culture vs. paying for retiree healthcare is a false one - we have to find a creative way to do both.

Of course, there is justified uproar about this possibility and threat to the DIA (and on one hand, it is encouraging to get more stakeholders interested and involved in finding good solutions for Detroit). The state legislature is reportedly considering a bill that would prevent the liquidation of DIA assets during a potential Detroit bankruptcy. It is a good signal, but I think it still leaves too much to chance (and the courts). The courts could overturn this law, or creditors could tie up the city/DIA for years in lawsuits.

Instead, I propose the State take possession/title of the DIA assets (and potentially, other City treasures we would like to protect for the public good like Belle Isle, etc.) in exchange for a capital infusion (there is no price tag and the number shouldn't really matter, but maybe $1, or $100 million, or $500 million, or $1 billion - the state has a bit of a surplus now, and if a capital injection could help fund a proper restructuring for the City that keeps it out of bankruptcy, so much the better). Critically, the deal should have an iron-clad clause whereby the City could redeem/reclaim the assets at some point in the future (e.g., in 10 years, or when the City meets some milestones) by repaying the State face value. Also, a clause promising to keep the assets in the city would help. This could help make such a deal palatable to City stakeholders (knowing they could reclaim the City "jewels" at some point; they could not do this if the "jewels" were liquidated in bankruptcy court) and hopefully, would accelerate a City-State agreement (unlike the dithering that cost Detroit the Belle Isle deal). If done early enough, I think this approach would properly shield the City assets from bankruptcy and the courts.

Benefits to City
>Cash infusion (and possible delay/prevention of bankruptcy)
>Protection of key assets for Detroit citizens
>Possible re-acquisition of key assets (buy-back option)

Benefits to State and other stakeholders
>Preservation of significant public assets
>Pathway to greater collaboration/investment in City
>Greater influence on key issues/assets in City

Friday, May 31, 2013

Math for Michigan: Efficiencies in airport transit

As a frequent business traveler, I often make trips to our airport, DTW. Sometimes, I drive. Sometimes, I take a cab. Sometimes, I am dropped off. The miles add up. If there was a shuttle or bus or train I could take instead, I probably would. Many Detroiters might say the same, and many are studying possible solutions (currently, Metro Cab's contractual monopoly does pose some challenges to transportation solutions, but not insurmountable ones).

Each year, DTW handles > 30 million passengers. Thereof, the airport originates ~17 million passengers. If an average travel party size is two people, that means each year, Michigan travelers are making ~8.5 million round trips to DTW.

If the average round trip is 50 miles, and the cost per mile is 55 cents (that is the rate I am reimbursed at, factoring in fuel, depreciation, insurance, etc.), then driving to and from the airport is costing Michiganians about $234 million per year, or $2.3 billion over a decade. The fuel alone (at 25 miles per gallon, and $4/gallon) results in $68 million in gas being burned by our citizens each year, or $680 million over a decade sent to Texas, Alberta, or Venezuela.

I'm not sure what an optimal network to connect Michiganians to the airport would look like, but in a 2006 study, SEMCOG estimated that transit from Ann Arbor to Detroit (passing through DTW) would cost $0.6-3.0 billion to setup and $25-110 million to operate annually (on the higher end for light rail, on the lower end for buses). If the new Regional Transit Authority can put together a network that serves even half of the local airport traffic (~4.2 million round trips), saving Michiganians collectively $1.15 billion over a decade, I'm pretty sure it would more than pay for itself over time (not even including reduced traffic, pollution, wasted time driving, ridership fees, etc.).

Anyone should be able to land in Detroit and just hop on a shuttle or bus or train to downtown Detroit, Ann Arbor, or other places without a hassle or expensive taxi or rental car, like they can just about any other major city in the world. Jobs, economic development, efficiencies, connectivity...connecting Metro Detroit to the airport with reliable public transportation is a no-brainer.

Sunday, March 31, 2013

Detroit - "Olympics of Restructuring"

March 2013 has been a historic month for Detroit.

The Governor declared the City to be in a financial emergency, which of course, was news to no one. Earlier this week, his appointed Emergency Financial Manager, a Kevyn Orr who studied at UM before moving out of state, started on the job. Interestingly, one of his first comments was to note that Detroit is the "Olympics of Restructuring." No disagreement with that observation from this corner.

Emergency managers have a mixed track record, but it seems like Mr. Orr is off to a decent start. Mayor Bing is on board and seems heartened to finally have a "partner" to work with to get things done in the city. The City Council has been remarkably more accommodating than many might have expected. In his first week, Mr. Orr has also extended an olive branch of collaboration, which is encouraging. I hope the personal tax kerfuffle he endured this week also tempers his actions - Detroit has its crooks but it also has many well intentioned people...sometimes things just fall through the cracks. The EFM can cut just about anything or everything, but that doesn't mean the ax will be more effective than pruning shears in all cases. At the end of the day, you can only cut so much - growth and revenue are the most effective solutions to Detroit's problems.

Mr. Orr has a very difficult task ahead of him, and we can only wish him all the best. It is encouraging that the business community is continuing its investments and support despite the civic mess. Dan Gilbert's vision and investments (which I was fortunate enough to be able to tour this month) are quite remarkable and almost exactly what I would have recommended for downtown, and the private funding for new emergency vehicles is as heartening as it is necessary. That being said, I hope such largess doesn't come without too many strings attached (e.g., an implicit requirement that the new vehicles be dedicated to Downtown/Midtown would not be helpful).

Wednesday, February 20, 2013

Momentum vs. impending emergency financial manager or bankruptcy for Detroit

It seems like the momentum surrounding the City has never been better. The investment. The enthusiasm. The energy. The new Hudson-Webber "7.2 SQ MI" report shared by the Free Press shows the evidence of progress in Midtown and Downtown: (this is an incredibly fascinating report and highly recommended read for those monitoring developments in the D)

It also seems like the City itself has never been worse. With the release of the Detroit Financial Review Team's findings, our suspicions have been confirmed. The City needs an Emergency Financial Manager or to go through bankruptcy.

Some observations on their findings (
  • Detroit will be spending ~$700 m on retiree healthcare over the next five years...Vanguard bought the entire DMC for just $365 m in cash (plus assuming liabilities and promises of future investments)...couldn't Detroit have just bought a hospital for $100 m and offered its retirees free healthcare for much less than what it is paying per year right now?
  • Since 2006, Detroit's Revenues have exceeded Expenditures (though both have been declining) for a Current Surplus each year...what is resulting in deficits in the general fund are huge negatives in "Other Financing Sources"...I wonder if this is debt/interest payments?
DPS went through the Emergency Financial Manager route with Robert Bobb. He did a lot of good things, but I'm not sure he solved the underlying problems, and I certainly wouldn't call DPS a success story just yet. Rather, it sometimes seems like DPS is just being wound down almost, and schools are continually being closed. I'm not looking forward to a similar story with Detroit. An EFM in Detroit can't just look to fix Detroit finances by downsizing and cutting and cutting. That is important, but if Detroit is to have a future and not dissolve, the EFM also needs to work with Detroiters and look to growth and new opportunities.

Bankruptcy worked for GM and Chrysler. Detroit is probably a more complicated situation, but I wonder if this would be a better solution than an EFM. Or, as I have proposed before, someone can just buy the outstanding bonds (that should be going for pennies on the dollar) and just retire them...

Monday, January 28, 2013

Athletic bridges – Pistons in the D and Red Wings in the 'burbs?

With the Ilitch family finally making its intentions about a new downtown hockey arena official, and with the NHL finally resolving its labor dispute, it seems like the Red Wings will remain in downtown Hockeytown for the foreseeable future, which is great. The new complex seems like it would be very impressive and promising, and would turn countless parcels that Mr. Ilitch currently holds into productive assets for the city on multiple levels.

On the other hand, with the Palace remaining a fine venue, it does not appear like the Pistons and their improving product will move downtown anytime soon, despite sagging crowd levels. Investing hundreds of millions of dollars into a brand new facility when the Palace remains in great shape does not make financial sense. While the City is a core market for the Pistons, I can't imagine marginal ticket sales from a move downtown would offset the investment required anytime soon. Perhaps Mr. Gores should invest in express buses to bring downtown fans to the Palace instead.

That being said, I think the new hockey facility represents an interesting opportunity for future Red Wings and Pistons collaboration. Why not have the Pistons pay ~10 games a year downtown at the new stadium, and have the Red Wings play a similar number of games at the Palace? Such an arrangement could help increase accessibility to each franchise and broaden the fan base. NHL and NBA franchises share arenas in other cities, and the IHL did use the Palace in the 1990s, so the concept is technically feasible. This way, at least until the Palace fully depreciates, the regions assets could be utilized in a creative way that builds new bridges and connections.

Monday, December 24, 2012

Detroit Olympics Update

Good news on Detroit's potential 2024 Olympic bid - the topic was the main focus of the program and discussion at the 2012 Southeast Michigan Summit, hosted by the Detroit City Council. Even better news - all the panelists and stakeholders present thought it was possible, and most thought it was a good idea to pursue! There is an incredible amount of work ahead of us, but at least the ball is rolling.

Speakers and Panelists at the Summit included: Councilman Charles Pugh; Ms. Susan Sherer (who led Detroit's efforts for the Super Bowl); Mr. Stefan Szymanski (Michigan professor of sports management); Mr. Dave Beachneau (Detroit Sport's Commission); Ms. Kathleen Lamako (SEMCOG); Mr. Marcell Todd (Detroit City Planning Commission); Mr. Bobby Smith (En Garde Detroit); and Dr. Syed Mohiuddin (Leadership Next, United Way).

At the end of the Summit, City Council President Charles Pugh even announced plans to add this to the Mackinaw Policy Conference agenda, and to put feelers out to other community stakeholders during the North American International Auto Show. Believe it or not, Detroit 2024 is now on the agenda!

Whether or not Detroit gets the Olympics, the investments and improvements needed for the Olympics are investments and improvements we need anyways. That being said, the Olympics would be a great way to celebrate a New Detroit in 12 years. Also, if the Olympics are a way to bring the world together, perhaps they will also pull Metro Detroit together in a way we haven't been in 40, 50 years. Our collective, united efforts will be needed to make a successful Olympics and a successful Detroit.

Here is a link to a presentation that has been reviewed with some key stakeholders and which was shared in part at the Summit:

Wednesday, December 12, 2012

A Historic Day - Will Right-to-Work Help or Hurt Michigan and its Workers?

History was made today in Lansing, as Governor Snyder signed into law several "right-to-work" bills that would make it optional for workers to contribute financially when they work under a union contract. After spending two years denying "right-to-work" was on his agenda, the Governor added it to his agenda and signed it into law in the space of a week during this lame-duck session.

Unions and "right-to-work" both have pros and cons, and there is a lot to discuss and assess on that front. First, however, a thought on the process itself:

  • Lame duck Republicans railroading this highly partisan, highly controversial bill through the Legislature with minimal discussion and no public input is a sham and a disgrace to Michigan; even if "right-to-work" is right for Michigan, such a bill should have gone through the proper channels and processes (I think a referendum would have been best); at best, this is a terrible precedent
  • There may be economic merits to "right-to-work", but the political nature of the timing cannot be denied; Republicans are taking a shot at weakening Labor and Democrats, sensing weakness given the loss of Proposal 2 (I couldn't vote for Proposal 2 to put union rights in the Constitution, but I didn't vote against it for that reason, because I didn't want Republicans to take its defeat as a sign that "right-to-work" had support)
  • The unions may have overreached by pushing Proposal 2, but it was more of a defensive measure than an offensive one in my view; given all of the anti-union legislation in the Midwest, from Wisconsin to Ohio to Indiana, it was only a matter of time before the battle came to Michigan; Governor Snyder could have shown true courage and leadership and taken a post-partisan stand by saying he would veto "right-to-work" legislation, but he never said that, and in the end, his reassurances that it was "not on his agenda" were hollow, as he supported "right-to-work" the second it came up anyways)
  • Like those other states, I fear this act which disturbs the balance of power is just the beginning of a long war; I'm afraid it will create a toxic environment in Lansing (perhaps to rival DC) and cause gridlock and uncertainty at a time when Michigan has many more pressing issues (e.g., Detroit, regional transit, taxes, etc.); as this struggle unfolds, our policies in Michigan may become disjointed and incoherent over the next decade; as a businessman, the Governor should have realized that if there is one thing that delays investments in job-creation and that businesses hate, it is uncertainty...
Okay, aside from the political mess and effects, here are some thoughts on the practical impacts:
  • Nothing will really happen for a few years; legislation will tie it up (even Governor Snyder is expecting some legal challenges)
  • Companies will certainly view Michigan more favorably when undertaking site selection exercises for their business; whether a geography is "right-to-work" is often a consideration for such companies, no doubt about it
  • That being said, Toyota or Volkswagen aren't coming to Michigan anytime soon; there is already too much auto production capacity in North America, their footprints are already elsewhere, so there is no reason for them to come to Michigan; I don't expect any other gigantic factories opening up in Michigan anytime soon either
  • With or without "right-to-work", unions really need to reinvent themselves; unions have a bad reputation in many places, and certainly, the way the system is setup, there are many inefficiencies and much room for improvement; solidarity is great, but for instance, perhaps unions should take another look at better integrating worker-by-worker performance-based incentive systems as part of compensation; also, maybe seniority should not be the only factor when layoffs occur (maybe other options should be considered, like some kind of rotations or an average decrease in hours, rather than layoffs)
  • Sure, unions will still be able to collectively bargain, but "right-to-work" will let workers "freeload" and benefit from the union but not pay the union, weakening them financially
  • If unions disappeared tomorrow, compensation and benefits would also go down tomorrow
  • "Right-to-work" is basically a step on the way down in a race to the bottom; Companies will typically pay workers as little as they can get away with (most think like Wal-Mart, not Costco); Governor Snyder indicated his impetus to support "right-to-work" was Indiana's passage of such a law earlier this year (the UAW rightfully feared his intentions in their misguided support of Proposal 2)...if all states adopt "right-to-work", then all states are just competing to have lower and lower wages; perhaps a national "card-check" law would level the national playing field; either way, we should be figuring out how to compete with Mexico and China (and not by lowering wages to their levels), rather than a zero sum game of shifting jobs between Midwestern states (and often paying hundreds of millions in tax incentives to do so)
  • Perhaps this law will have the perverse effect of making it easier for Unions to organize labor places (after all, if someone doesn't lose any money in dues, and only gains with higher wages, why not vote to unionize?)

Tuesday, December 4, 2012

Dealing with Detroit's Debt

I've never seen the momentum, buzz, interest, investment, and other indicators around Detroit as good as they are now. It is too bad that the actual City itself has never been in worse shape.

Detroit's financial woes haven't been real news for years, but it finally looks like it is time to pay the piper. Gridlock between the Mayor, the City Council, the City Attorney, and the State, as well as the elimination of the Emergency Financial Manager option, make bankruptcy an extremely likely outcome. As an extreme case, some folks are already suggesting to dissolve the City and merge it with Wayne County, or (even worse in my book) liquidate the DIA's (City-owned) priceless art collection.

We can hope that our elected officials and public servants sort this out, but I'm not optimistic. Unfortunately, there is not much ordinary citizens can really do at this point to stop the slow moving train wreck. However, there is one trick that it might be interesting for some of us to pursue.

On the way to Operation HOPE's Global Financial Dignity Summit last month in Atlanta, I read about one of the Occupy movement's new focus areas – debt. One tactic they are pursuing is to purchase outstanding loans of bankrupt folks (that typically trade for pennies on the dollar) and then forgiving them. I'm not sure what Detroit's bonds trade for, but I imagine they are deep in junk territory and severely discounted. Perhaps this could be a solution for Detroit as well. If the Detroit's citizens can buy and retire $1 billion (in face value) of debt/bonds for ~$50 million (I'm not sure what they are trading at, but even $500 million would be a deal, if offset by future tax credits), well that's a good deal in my book. Maybe the City could even reward Citizens who help it out through such a gift (e.g., by reducing property taxes for a certain period, or giving out lifetime free parking passes in the City)

Sunday, December 2, 2012

Governor Snyder last hope for regional transit?

Interesting piece in today's Free Press about the struggle to achieve (or re-achieve, as it were) a coordinated regional mass transit system:

I knew Detroit had a trains in the 1950s before our system was dismantled. I didn't realize the system connected Detroit with so many other cities.

"We had a very good transit system until then," said John Hertel, general manager of the Suburban Mobility Authority for Regional Transportation (SMART), which runs the suburban bus system. "We had a trolley system that went from Detroit to Port Huron, Flint, Ann Arbor and Toledo. And it was all gone by 1956."

Who knew?

I also didn't realize our trolley's went to Mexico City, where they are still in use.

"It's a crucial piece of the public transportation pie for metro Detroit, which has struggled to stitch together a cohesive transit system since 1956, when the last of Detroit's streetcars were decommissioned and sold to Mexico City, where they still are in use today."

Anyways, it seems like everyone is on board this time except the state House. Time to call your Representative and get them to play ball and pass the necessary bills. Federal support is available to help, so now is the time to for action on this.

I guess I wasn't following this issue too closely a decade ago, but apparently Governor Engler vetoed our last chance in 2002. Hopefully Governor Snyder takes this issue across the finish line. Too much is at stake. 

Friday, November 30, 2012

Ballot initiatives and rethinking gerrymandering in Michigan's constitution

Voters in Michigan sent back six proposed constitutional amendments this month. It is heartening to know that citizens are at least sometimes too smart for the money and advertising rampant in our political system. The people did decide.

The fact that so many random amendments were on the ballot has me considering that it might be time to push for something truly meaningful and game-changing as a constitutional amendment in this state.

In particular, I think it would be extremely beneficial for all Americans if Michigan leads the way in combating the ill-conceived, unjust practice of gerrymandering by adopting a constitutional amendment to place the responsibility of redrawing electoral districts in the hands of non-partisan technocrats. These demographers should be mandated to redistrict Michigan in a way that promotes moderate candidates from all parties, rather than having a handful of Red and Blue districts that will automatically elect whichever Republican or Democrat emerges from the primaries, even if they are foolish, insane, criminals, Santa Claus, or a devolved primate.

The fact of the matter is that Congress had an approval rating in the low teens, and a re-election rate close to 90%. Democracy in action and at its worst. Our system breeds uncompromising extremists on both sides, and we are paying the price as a country. The looming fiscal cliff is only the latest in a series of failings by our national leadership. Redrawing the electoral lines to promote more reasonable candidates should be a national priority, and Michigan can lead the way. I hope our unions, businesses, and other advocates consider this option – uncertainty, extremism, and a bi-polar government serve no one's interest, neither the right nor the left.

To be sure, Michigan might on average have fewer senior, powerful, tenured representation in Congress. However, the folks we do send to DC will be moderate deal-makers, willing to cross the aisle and compromise - in today's Washington, there is no one more powerful (think back to the passage of healthcare reform, where a handful of representatives in the middle had out-sized influence on the outcome).

Tuesday, October 9, 2012

Alarming outlook - half of Detroiters gone in five years?

Everyone knows Detroit has shrunk by more than half over the past 50 years, to less than 750 k inhabitants. Unfortunately, according to a recent poll from Glengariff Group, commissioned by the News (, 40% of inhabitants plan to leave the City within the next five years.

Other insights:
  • 57% of those planning to leave are families with kids
  • Crime and insecurity is the key factor driving the exodus ("there's an aura of fear that just pervades the whole neighborhood" is an observation that sums up the problem nicely) - 58% of respondents say crime is their biggest daily challenge (comparatively, the economy and unemployment is the top challenge for only 13% of respondents)
  • 53% of women feel unsafe (vs 43% of men)
  • 66% of residents believe the City is on the wrong track
  • Almost all city officials had extraordinarily low approval ratings
  • Carjackings are commonplace
Young people and professionals moving to Midtown or Corktown or downtown are great trends. However, if we cannot address the instability in the neighborhoods, the influx and momentum we are seeing will be lost against the ongoing mass exodus.

Sunday, September 30, 2012

Unique Detroit attributes for 2024 Olympic Games

Detroit has a lot of differentiating attributes that make it a unique and attractive candidate city for the 2024 Summer Olympics.


Stadiums: Detroit and its suburbs already have several world-class sports arenas, including Michigan Stadium, the largest stadium in North America, as well as newer or renowned facilities like Ford Field, Tiger Stadium, and the Palace

Logistics: Detroit has arguably one of the best airports in the world, with minimal delays and great global access; Also, the City has a brand new port terminal which could welcome cruise ships for temporary lodging capacity

Experienced Host: Metro Detroit has extensive experience hosting a number of high-profile, well-attended events, from the annual North American International Auto Show, which typically attracts ~ 1 m visitors, to recent sporting events like the Super Bowl, NHL Winter Classic, Final Four, and World Series; while not as large or extensive as the Olympics, each of these events has been deemed a success by organizers and the City, and there is reason to believe a Detroit Olympics would be similarly successful

Corporate Support: Detroit and its renaissance have long enjoyed the strong support of local businesses, especially including two of America's 10 largest companies (and spenders on advertising) – GM and Ford


Spirit: Detroiters are proud of their City and its impact on the world, through its innovation, its music, or its heroes and the City is often considered among the top cities for Sports in the US; the level of civic interest and engagement in Detroit has never been higher, so a Detroit Olympics would have the full support of all Detroiters and Michiganians, and given the value of hard work and effort in this City, participation and contributions will come from all sides to ensure a successful event

Awareness: Detroit's global name recognition and cultural influence is on par with almost any leading city in America or the world – Good or bad, people have heard of us, they know our problems, and they know what we do

Legacy: The Olympic legacy in Detroit is one that is unlikely to be matched by just about any other city in the running; in the grand scheme of things, the Olympics represent a notch on the belt on places like Tokyo or London or Los Angeles or Toronto – in Detroit, the Olympics would represent the crowning achievement of a renaissance decades in the making


Global Nature:
Detroit is one of the world's largest border cities, and Detroit-Windsor is possibly the most important border crossing in the world; a Detroit-Windsor Olympics would have the unique opportunity to engage the citizens of two nations, and indeed, perhaps it is the only conceivable Olympic host where an event could start in one country and end in another

Diversity: Detroit has a very diverse population, with a large and influential immigrant population from many countries in different parts of the world; if the City is able to work with these Immigrants to build ties with those countries by celebrating this diversity, it could help sway some IOC votes toward Detroit

Thursday, August 23, 2012

New City Lighting Plan?

The lighting issue has gotten quite a bit of attention from local Detroit media in recent weeks, mostly because the City announced a new plan/strategy for lighting.
Highlights so far include:
  • Four-phase, $160 m strategy to improve Detroit lighting system in neighborhoods, around schools, and along major roads by 2015
  • Immediate repair of 3300 lights on major thoroughfares for $614 k (or $186/light; I guess the to fix a streetlight, it costs 3x as much than it would for ACCESS to install a porchlight)
  • A new call center for reporting outages is dependent on the passage of three bills in Michigan legislature (1-to create public authority; 2-utility user tax for funding; 3-delayed city income tax reduction for funding)
From the Free Press article, an overview of the four phases:
Phase One: Stable neighborhoods, such as Sherwood Forrest, Green Acres, east and west Outer Drive and Grand Boulevard would see lighting improvements. The city would convert about 1,525 antiquated lights and remove the nearly 14,000 nonfunctioning alley fixtures that dot the city. This would occur between November and April 2013.
Phase Two: The city would focus on converting 10,000 obsolete series light fixtures to modern LED lights on major thoroughfares, such as Gratiot, Grand River, Woodward, Livernois, Downtown, Midtown, and Michigan and Jefferson avenues. The city also would remove outdated fixtures from certain neighborhoods. This would occur from April 2013 to April 2014.
Phase Three: The city would continue to convert lights, including 10,000 in selected neighborhoods and what the officials describe as semi major thoroughfares such as Junction and Pembroke. Antiquated light fixtures would continue to be removed from neighborhoods. This would occur from April 2014 to April 2015.
Phase 4: In the final phase, the city would complete the removal of obsolete lighting fixtures and the authority would assess the population in distressed areas of the city to determine lighting needs. This would occur from April 2015 to April 2016. 
Also, on August 14, Mayor Bing wrote an op-ed in the Free Press to encourage State support for his plan. It is great that the City has recognized and prioritized the problem (this Detroit4Detroit project would not exist if lighting had been on the City's radar in recent years.
This all seems pretty good, and it is really great that the City is making lighting and safety a priority like this. However, there are some limitations and concerns. Of course, it is still quite dependent on the Republican legislature to come to anything. Also, many people will remain in the dark until 2015, and if I read the Mayor's comments correctly, thousands of fixtures will be removed, but he didn't mention anything about replacing them. Another point to consider, as Stephen Henderson notes, this lighting plan may come at the cost of a reduction in other essential services, like the police force.

Tuesday, August 7, 2012

Rationale for Detroit 2024 Olympics

We still have a lot of work to do to fix Detroit in the coming decade, but there are many reasons the City, the US, and the IOC should consider having the 2024 Olympics in Detroit.

Why the Olympics?
  • Acceleration of necessary investments
  • Alignment of local and regional stakeholders
  • Fundamental re-branding and re-positioning of City in global perception (i.e., from failure to success once again)
Why 2024?
  • Likely return of Olympics to US
  • ~10-yr goal providing the impetus and timeline for Detroit to make necessary improvements local finances, governance, infrastructure, etc.
  • Sufficient lead time for Detroit's nascent recovery to take root and would mark a significant milestone or crowning achievement in the recovery
Why Detroit as US Olympic candidate city?
  • Most compelling potential legacy story
  • Very high global name recognition
  • Least disruption/ displacement
  • Highest potential infrastructure legacy (i.e., public transit)
  • Cost/investment sharing and other collaborative opportunities with Canada
Why Detroit as Olympics host city? 
  • Triumphant return to the US with great story and potential legacy after decades long absence
  • Strong local Olympic tradition, pool of Olympians and support base for participants
  • Corporate sponsorship by some of the largest US companies and spenders on advertising
  • Potential for sport to literally bring people of different nations together through joint events with Windsor