Mar 21, 2023 - News

Sheffield floats LCA ticket charge proposal

Council President Mary Sheffield sits at the table with other council members during session.

Detroit City Council President Mary Sheffield during the lawmaking body's formal session. Photo courtesy of the city of Detroit, via Flickr

Council President Mary Sheffield wants the Ilitch family to agree to a 2% ticket surcharge from the city for events in their arena district.

Driving the news: The charge is among several additional commitments Sheffield brought up in committee last week as City Council debates approving city tax abatements for the Ilitches' and Stephen Ross' Related Co.'s $1.5 billion District Detroit development proposal.

The latest: City Council could vote as soon as today after a committee voted last week to move the requests to the full body without a recommendation to approve.

  • The items were moved with a "neutral" mindset, Council Member Fred Durhal III said, because of lingering unanswered questions.

Flashback: Sheffield also requested commitments on top of previously agreed-upon community benefits in July for a $60 million tax break for Dan Gilbert's Hudson's site. Council approved it after Gilbert's Bedrock agreed to those additional asks.

  • Sheffield also previously sought a ticket surcharge "or some type of direct revenue" for the city from Little Caesars Arena during the original deal around a decade ago, she said Thursday.

The other side: The Ilitch organization's Olympia Development declined to comment to Axios, but said it would likely address the surcharge at today's council session.

Reality check: Detroit would need a state law change to levy a new tax for entertainment venues, Eric Lupher of the Citizens Research Council of Michigan tells Axios.

  • Sheffield specified this would be a "voluntary agreement the developer would enter into," not a tax change. But it could only be enforced if authorized by city voters, per a city law department statement.
  • A similar precedent for a voluntary charge could be the local visitors' bureau's 2% assessment on hotels in the metro area, Lupher says.
  • It's unclear how the surcharge would be passed on to event attendees.

Of note: Other additional commitments Sheffield brought up include strengthening the language and impact around what's currently a developer "target" of spending $100 million with Detroit-based and "disadvantaged" businesses.

  • "If I'm going to support this project, I'd like to see stronger language regarding it," Sheffield said.
  • She also supports a monetary contribution to the city's affordable housing fund.

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